Venture Capitalist: The Middle Class (Not the Wealthy) Are the Engine of Economic Growth

On Friday, Marketplace had an interesting interview with a wealthy venture capitalist named Nick Hanauer who recently gave a TED talk on income inequality that generated some controversy because he made a strong case for raising taxes on wealthy earners. Give a listen to the full interview below.

Here's the takeaway:

Prosperity for people like me is a consequence of the number of customers I have, not the tax rate that I pay. If low taxes were the way that people like me created wealth, then we'd be starting our companies in the Congo or Somalia or Afghanistan, but we're not. We come to places where there are lots and lots of customers...

Third and State This Week: PA Jobs Report, Uncompensated Care Costs at Hospitals & Alcohol-Related Traffic Deaths

This week at Third and State, we blogged about Pennsylvania's April jobs numbers and state revenue report, a new report on uncompensated care costs at hospitals in the commonwealth, rates of alcohol-related traffic deaths in alcohol control states, and much more.

IN CASE YOU MISSED IT

  • On jobs and the economy, Mark Price blogged about Pennsylvania’s April jobs report and an effort to undermine the state’s unemployment insurance system.
  • On health care, Chris Lilienthal wrote about a new report from the Pennsylvania Health Care Cost Containment Council finding that uncompensated care costs at hospitals rose 11% in 2010-11, the same year the state ended the adultBasic program.
  • On the privatization of alcohol distribution, Mark Price shared a new Keystone Research Center analysis finding that states with tighter control over the sale and distribution of alcohol have lower alcohol-related traffic deaths than states that take a more hands off approach.
  • On state taxes, Michael Wood wrote about the April state revenue report, which marked the third straight month of collections exceeding monthly estimates.
  • And in Morning Must Reads this week, Mark Price highlighted news coverage of an effort to legalize predatory payday lending in Pennsylvania and what that has to do with motor vehicle fatalities among oil and gas workers; stories on Governor Tom Corbett’s question-and-answer session at a Greater Philadelphia Chamber of Commerce event; the Governor’s “Do as I say, not as I do” message to school districts; and the importance of training programs targeted to the needs of employers as the economy recovers.

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

Uncompensated Care Costs Rise at PA Hospitals

More than a year ago, the Corbett administration decided to end the state's adultBasic program, which provided affordable health insurance to about 40,000 low-income Pennsylvanians who were unable to obtain coverage from an employer or through other programs.

We worried at the time that many of those newly uninsured would delay treatments until a health condition snowballed into a more serious and costly problem, sending more people to the emergency rooms of our community hospitals.

Morning Must Reads: PA Job Numbers Out, The War On Unemployment Insurance, and Inequality

Happy Sunny Friday, people! Now for the not so good news. The job numbers for Pennsylvania came out Thursday, and the overall picture was somewhat disappointing. The unemployment rate edged down slightly to 7.4% and nonfarm payrolls declined by 600 jobs.

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. 

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