Spending and Budget Initiative

Spending and Budget Initiative

The Spending and Budget Initiative draws on a team of university economists and policy practitioners with diverse expertise in government spending and budget reform, assembled to provide policy makers an honest understanding of budgets, spending, deficits, and debt and how these issues relate to economic growth and progress. Mercatus scholars work alongside policy makers to identify fiscally responsible policies and actionable options for budget reform.

Research

Mark J. Warshawsky, Ross Marchand | Apr 29, 2015
We explain that the medical-vocational grid guidelines that are used to determine whether someone is disabled are an important part of the explanation for increased disability awards. The grid applies much looser standards for applicants as young as 45 and 50. We propose that age be eliminated as a deciding criterion, as well as language ability and education level. We also note that the guideline’s list of impairments is outdated and needs to reflect a modern workforce that has access to remedying medical technologies.
Mark J. Warshawsky | Apr 16, 2015
A new study for the Mercatus Center at George Mason University is the first to rigorously assess the details of the proposed regulation using empirical methodology widely accepted in the financial industry and comparing the proposed illustration to the Social Security statement. The regulation would require all defined contribution plans to inform their participants of the life annuity income equivalents of the current and projected balances in their individual accounts. The study examines several changes the Department of Labor can make to improve its proposal.
James C. Capretta | Mar 25, 2015
Reforming the congressional budget process is no substitute for actual policy changes that can correct the government’s fiscal problems. Yet according to a new study published by the Mercatus Center at George Mason University, the right kinds of process reforms can open up new potential for agreement between Congress and the president and can focus attention on long-term spending commitments.
Charles Blahous, Jason J. Fichtner, Mark J. Warshawsky | Mar 19, 2015
Social Security’s trustees have long warned Congress to address the troubled finances of the Disability Insurance (DI) program. Given the DI trust fund’s projected exhaustion date of 2016, legislation will be required during this Congress to prevent large, sudden benefit cuts.
Jason J. Fichtner, Jason S. Seligman | Mar 05, 2015
This paper focuses on disability insurance but makes the case for considering reforms in tandem—that is, (1) developing disability program reforms that accommodate plausible retirement program reforms while properly aligning incentives to support work and savings and (2) providing a financially secure, vital safety net for disabled Americans.
Jason J. Fichtner, Adam Michel | Jan 29, 2015
The tax code is often manipulated by arbitrarily shortening depreciation timelines through accelerated depreciation or bonus expensing. As a solution to the current inequity and inefficiency of depreciation policies, this paper advocates full expensing. Expensing incentivizes investment by allowing businesses to write off all expenditures in the year they occur, resulting in a zero effective tax rate on equity-financed capital.

Testimony & Comments

Veronique de Rugy | Mar 24, 2015
Policymakers who are interested in supporting the entrepreneurs and companies that will deliver the next generation of energy supplies and products should focus their attention on correcting the federal government’s hostile tax climate and dispense with the futile hopes of outsmarting the marketplace.
Neil Meredith | Dec 22, 2014
This comment considers the potential impact of the Office of Personnel Management’s (OPM) proposed rule change to the Multi-State Plan Program (MSP) for the affordable insurance exchanges created through the Patient Protection and Affordable Care Act of 2010. The purpose of the proposed rule is to further explain OPM’s direction in meeting the statutory requirements of the MSP program concerning health issuers that establish an MSP option with OPM.
Antony Davies | Jul 28, 2014
There are two important unintended consequences of raising the federal contractor minimum wage: first, it can adversely affect the most vulnerable workers; and second, the rule as currently stated could be enforced in a manner so that its impact would extend to far more businesses than originally intended.
David M. Primo | Jul 24, 2014
Constitutional rules, unlike statutory or internal rules, are difficult to change. If written to cover the entire budget, avoid loopholes, and make waivers difficult to obtain, Constitutional rules can provide the enforcement mechanism that will help ensure that specific reforms to entitlements, defense, and other spending areas will not be undone by future Congresses.
Veronique de Rugy | Jun 25, 2014
The Bank has long outlived its purpose and cannot manage to meet the standards of the new missions that have been developed to validate its existence. For policymakers who have the facts, the choice is clear: the Export-Import Bank must go.
Jason J. Fichtner | May 21, 2014
Social Security faces real financial challenges. Dismissing the real and current fiscal challenges facing the Social Security system and kicking the “reform can” further down the road will only increase the severity of the burden associated with reforms when they inevitably must take place.

Research Summaries & Toolkits

Charts

Veronique de Rugy | Apr 20, 2015
In spite of their complaints about federal overreach, state policymakers are addicted to handouts from Washington because it allows them to spend “free” money instead of asking their constituents to come up with funds via higher taxes. Unfortunately, federal money is not “free,” and the consequence of the federal government’s funding what are properly state and local responsibilities is excessive growth of government at all levels.

Experts

Videos

Veronique de Rugy | February 02, 2015
Veronique de Rugy Discusses President Obama's Budget on CNBC Asia…

Podcasts

Jason J. Fichtner | April 10, 2015
Numerous opportunities for tax reform have been proposed in recent years including consumption-based taxes and an overhaul of the existing system. Jason Fichtner discusses the strengths and weaknesses of various reform initiatives on C-SPAN Radio.

Recent Events

| March 14, 2013
Please join us for a casual reception where you can take a break from March Madness and meet some of our scholars who can provide the kind of practical information you need to be most effective in your work.

Books

Joseph Antos, Charles Blahous, James C. Capretta, Robert Graboyes, Jason J. Fichtner, June O’Neill , Nina Owcharenko , Thomas P. Miller, | Apr 08, 2014
Top experts explain everything you wanted to know about Medicaid—from federal-state financing to potential reforms.
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