The Dreaded Omitted Variable Bias Red Card

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Most people would expect that states like Pennsylvania that more tightly control alcohol sales would have fewer of the social problems associated with excessive drinking, including alcohol-related motor vehicle fatalities.

So you can imagine our surprise when analysis by economists John Pulito and Antony Davies reached the very opposite conclusion. Their work was published by self-avowed “free market” think tanks, including Pennsylvania’s Commonwealth Foundation and the Mercatus Center at George Mason University.

The Pulito-Davies findings are at odds with those of a panel of public health experts who recently studied the effects of privatization of retail alcohol distribution. Based on a systematic review of the available research, the panel found that privatization contributes to increases in alcohol consumption, creating a greater risk of alcohol abuse and its associated social costs.

Morning Must Reads: Governor to School Districts: Do As I Say Not As I Do

The Associated Press reports this morning that Governor Corbett believes reductions in access to kindergarten and music or arts programs could be avoided if more school districts would spend down their reserves. This is the same Governor Corbett who left nearly half a billion in revenue unspent in last year's budget and the same Governor arguing that the new budget should again leave unspent hundreds of millions in better-than-expected state tax revenues.

April Tax Collections Improve Revenue Outlook

In case you missed it last week, we published our monthly analysis of revenue collections at the Pennsylvania Budget and Policy Center's web site. Good news on the revenue front continued in April, with collections surging past monthly estimates (as they did in March), putting the state on much better fiscal footing going into 2012-13.

Morning Must Reads: The Pennsylvania Hunger Games Diet: Cash for Corporations, Cuts for Kids

On Tuesday Marty Moss-Coane, the host of WHYY's Radio Times, moderated a question-and-answer session with Governor Tom Corbett at an event sponsored by the Greater Philadelphia Chamber of Commerce. The Governor ran wild with analogies.

Morning Must Reads: Policy Matters in Payday lending and Fracking

Unless you have been away for two weeks, you will note I have been posting a lot about House Bill 2191, which if enacted would legalize predatory payday lending in Pennsylvania.

If you listen to only the policymakers pushing this legislation, you would conclude this bill is a common-sense reform aimed at boosting consumer protection. The reality is quite different since the bill opens the door to a kind of predatory lending that exploits working families and destroys jobs

Morning Must Reads: Training and Education? Let Them Go To The Pittsburgh Opera

When workers lose their jobs in a recession, they have time that could be spent in training programs targeted to the needs of employers. Of course, there is a hitch: during a recession, employers are not hiring, so at the very time there are lots of people available to train, employers don't need new workers. As the economy improves (like it is now), it opens the door to training tied to the needs of businesses that are hiring. 

Third and State This Week: PA Senate Approves Budget, Payday Lending Advances & a Harrisburg Rally

This week at Third and State, we blogged about the Pennsylvania Senate's passage of a budget, movement on a bill to legalize predatory payday lending in the state, a big rally at the state Capitol, analysis of the April jobs report, and much more.

IN CASE YOU MISSED IT

  • On the state budget, Sharon Ward wrote about the Senate's passage of a state budget bill this week that improves upon the Governor's budget but still makes deep cuts to education and health services. Earlier in the week, she had a blog post on the Senate budget when details first emerged. Chris Lilienthal highlighted a Monday rally at the Capitol that brought 700 Pennsylvanians to Harrisburg to call on lawmakers and the Governor to save the General Assistance program and restore cuts proposed to county services for children, the homeless and people with disabilities. Plus, Mark Price blogged about concerns that the state will not spend all the tax revenue it collects, creating a further drag on the economy.
  • On banking, Mark Price blogged about committee approval of a state House bill that would legalize predatory payday lending in Pennsylvania and what that would mean for the state's consumers and economy.
  • On jobs and the economy, Mark Price shared analysis of April's U.S. jobs report.
  • Finally, Mark Price had a roundup of news on the economic impact of state and federal budget cuts, the prospect of higher interest rates on student loans and the geography of manufacturing. 

More blog posts next week. Keep us bookmarked and join the conversation!

Morning Must Reads: Budget Outlook Improves, Governor's Understanding of Economics Not So Much

The headline on an editorial by The Daily Review of Towanda says all you need to know about payday lending.

Predatory Payday Lending Bill Flies Out of Cramped House Consumer Affairs Hearing

Room 148 of the State Capitol might as well double as a Capitol broom closet. That's where the House Consumer Affairs Committee this morning rushed out amendments to House Bill 2191, which legalizes predatory payday lending in Pennsylvania.

The amendments to HB 2191 were misleadingly pitched as adding more consumer protections to the bill. Even the Navy Marine Corps Relief Society took a look at these amendments and said they do "nothing to mitigate the already harmful aspects of HB 2191," and that one amendment "actually worsens the problem it claims to solve."

PA Senate Approves Budget, But Deep Cuts Remain

The Pennsylvania Senate approved a $27.6 billion budget plan today by a vote of 39-8. The plan improves upon the budget proposed by Governor Tom Corbett, but deep cuts to education and health services remain.

On Tuesday, the Senate Appropriations Committee, in a rare display of bipartisanship, adopted two Democratic amendments and unanimously approved the spending plan.

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