State and Local

State and Local

Research

Jason Sorens | Feb 09, 2016
When local governments in the United States and other developed nations become more dependent on the central government’s grants, they tend to become less efficient, spending more and taxing more for the same level of services. Voters can also find it difficult to understand which level of government is responsible for which policy.
Edward J. Timmons | Jan 26, 2016
Increasing licensing requirements for healthcare professionals is often promoted as a measure to improve the quality of care, but its main effect may be to raise costs for patients.
Stephen Miller, Zachary Gochenour | Jan 19, 2016
A new study written for the Mercatus Center at George Mason University analyzes North Carolina’s performance on key issues, the way in which the state government manages itself, and opportunities for improvement. North Carolina has recently implemented proactive reforms to its tax system, indicating that state lawmakers are capable of executing the other positive policy changes outlined in this study.
Mark J. Warshawsky, Ross Marchand | Jan 07, 2016
A new study for the Mercatus Center at George Mason University examines both the overall financial condition of state and local pension plans and the legal impediments to pension reform. It argues that reform proposals that assume the federal government will bail out state and local pen- sions are politically and economically unworkable and unfair. Instead, it presents a two-pronged reform proposal: (1) require state and local authorities to disclose the financial condition of their pension plans to beneficiaries in plain language and using standardized conservative accounting assumptions, and (2) allow state and local governments to offer beneficiaries a choice between accepting the uncertain and risky future benefits originally promised or receiving a discounted lump-sum benefit right away.
Erick M. Elder | Jan 06, 2016
Rainy day funds are one tool that most US states use to help mitigate the fiscal stress caused by economic slowdowns that reduce state government revenue. Past research I did with Gary Wagner uses a switching regression to estimate parameters in order to form a distribution of potential budget shortfalls for each state. This paper updates those results to include post–Great Recession data. A comparison of this distribution to the actual amount of savings that states have accumulated allows an assessment of how prepared each state is for an economic downturn and the resulting decline in tax revenues. What ability do states have to weather economic downturns without raising taxes or reducing spending? States are ranked based on their current ability to weather future economic downturns.
Susan P. Convery, Andrew J. Imdieke | Nov 05, 2015
A new study for the Mercatus Center at George Mason University examines how government financial statements that follow generally accepted accounting principles provide useful information to decision makers. Local government decision makers should learn how to use this information to design stronger governments that avoid fiscal distress.

Testimony & Comments

Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | Jun 12, 2015
There is little evidence to support the claim that certificates of need are an effective cost-control measure; and Stratmann and Russ have found that these programs have no effect on the level of charity care provided to the poor. While controlling health care costs and increasing care for the poor may be laudable public policy goals, the evidence strongly suggests that CON regulations are not an effective mechanism for achieving them. Instead, these programs simply decrease the supply and availability of health care services by limiting entry and competition.
Eileen Norcross | Jun 11, 2015
In this brief comment, I will focus on the correct framework to use in selecting the appropriate interest rate when valuing public pension sector liabilities. A framework based on economic principles will accurately measure the market value of these liabilities and is superior to the actuarial approach.
James Broughel | Sep 02, 2014
This year’s report makes several important improvements over reports from previous years. However, there are still a number of ways in which this report can be made more useful if it is to be a meaningful representation to Congress and the American public of the effects of the regulatory system in the United States.
Matthew Mitchell | Oct 04, 2011
Matthew Mitchell testified before the House Committee on the Judiciary about state governments' experiences with Balanced Budget Amendments.
Russell Roberts | Feb 16, 2011
Russell Roberts testified before the House Committee on Government Oversight and Reform on the second anniversary of the stimulus.
Eileen Norcross | Feb 09, 2011
Eileen Norcross testified before the U.S. House Committee on Oversight and Government Reform on the looming municipal debt crisis.

Research Summaries & Toolkits

Speeches & Presentations

Expert Commentary

Feb 09, 2016

Government programs rarely achieve their goal so there is good reason to be skeptical of this one, especially since it fails to address the root cause of the problem. A better, more effective solution for helping teenagers gain valuable job skills would be to set the minimum wage at the proper level of $0 and let the labour market work.
Jan 28, 2016

Whether your state is relatively prepared or unprepared for the next economic downturn, the good news for taxpayers and for people who rely on government services is that smart policymakers will learn from the past.
Jan 20, 2016

It's been almost 30 years since the last major federal tax system overhaul, and the chances of real reform in the next year look grim. But as usual, there's some hope in the states, and reformers may want to direct their efforts there.
Jan 10, 2016

Poor decisions by state and local officials, and the politically charged collective-bargaining environment they work within, are to blame for the crisis. It's up to these policymakers to work with pension-plan beneficiaries and their representatives to solve it. The following plan would alleviate some of the financial pressure on public pension plans and satisfy retirees who are willing to opt-in - and it is politically viable.
By Marc Joffe |
Jan 07, 2016

Puerto Rico's debt crisis — the subject of House hearings later this month — represents a failure of the island's unique commonwealth governing model. It's not a country, not a state, and not a territory. Instead, Puerto Rico is a combination of all three: a largely self-governing island with heavy economic and political dependence on a great power.
Jan 04, 2016

Most Ohioans would probably agree that their state’s finances are managed relatively well. According to Mercatus Center at George Mason University research, which ranks states’ fiscal health, they’re right. Ohio ranks seventh nationwide, and several of the states placed higher have the advantage of massive oil and gas revenue.

Charts

According to recent research, expanding state Medicaid spending is “crowding out” spending on other major state programs, most notably education and transportation infrastructure. This growth in state Medicaid spending, however, does not seem to be increasing state debt burdens.

Experts

Matthew Mitchell is a senior research fellow at the Mercatus Center at George Mason University, where he is the director of the Project for the Study of American Capitalism. He is also an adjunct professor of economics at Mason. In his writing and research, he specializes in economic freedom and economic growth, public-choice economics, and the economics of government favoritism toward particular businesses.
Eileen Norcross is a senior research fellow at the Mercatus Center at George Mason University. As director for the Mercatus Center’s State and Local Policy Project, she focuses on questions of public finance and how economic institutions support or hamper economic resiliency and civil society. She specializes in fiscal federalism and institutions, state and local governments and finance, pensions, public administration, and economic development.
The Honorable Maurice McTigue, QSO, is vice president for outreach at the Mercatus Center at George Mason University. He is director of the Mercatus Center’s Government Accountability Project and a member of its Spending and Budget Initiative and State and Local Policy Project.
Adam Millsap is a research fellow for the State and Local Policy Project at the Mercatus Center at George Mason University. Adam was also a Mercatus Center Adam Smith Fellow.
Mark J. Warshawsky is a Senior Research Fellow at the Mercatus Center of George Mason University. His research interests include employer-sponsored retirement programs, social security, financial planning, health and long-term care financing, corporate and public finance, and macroeconomics.

Podcasts

Eileen Norcross | October 08, 2015
Eileen Norcross discusses a recent op-ed on the need for transparency surrounding property tax increases in Virginia with Mike Schickman on WSVA.

Recent Events

Join us for a lunchtime discussion as Eileen Norcross explains what policy changes would help Arizona improve its fiscal health.

Books

Michael S. Greve | May 22, 2015
This essay examines the sources and the scope of federalism’s failures. It provides a trenchant, constitutionally grounded analysis with profound implications for a range of current policy debates. Federalism’s restoration requires not merely rebalancing the federal-state relationship through decentralization. Rather, we must restore the structure of federalism to competitive federalism—which encourages states to compete to enhance freedom and economic growth—in response to the rise of cartel federalism, which squashes competition between the states and makes states dependent on the federal government.

Media Clippings

Eileen Norcross | Feb 02, 2014
Eileen Norcross cited at The New York Times.
Sarah Arnett | Jan 17, 2014
The Mercatus Center cited at Philly.com.
Sarah Arnett | Jan 16, 2014
The Mercatus Center cited at Investor's Business Daily.
| Jan 16, 2014
Mercatus cited at Union Leader.
Adam Thierer | Oct 08, 2013
Adam Thierer cited at Politico.
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