Urban Institute experts weigh in on current social and economic policy issues.The Folly of the Debt Ceiling Posted: October 24, 2013
The United States is starting down the road of third-world budgeting practices in a fiscal mess of its own making, warned Institute fellow Rudolph Penner in this commentary for CNNMoney.com before the debt-ceiling debacle.
Private Equity Is a Business: Sun Capital and Beyond Posted: September 24, 2013
Private equity has grown exponentially: it now controls and operates a large number of the companies in our economy. But private equity is just that: private. Its operations are confidential and difficult to parse. This article attempts to demystify the business of private equity. It also describes the unanimous decision by the 1st Circuit that a private equity fund is a trade or business for purposes of ERISA. Finally, the article discusses the tax implications of "trade or business" status for private equity funds and recommends further guidance from Treasury.
Employer Penalties Do Not Drive Coverage
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On July 2nd, the Obama administration announced a 1-year delay in the implementation of employer penalties associated with large employers (50 or more workers) who do not offer affordable coverage to their full-time workers (30 or more hours per week). Our prior analyses show these penalties are not the driving force behind the ACA's coverage expansions. Nor are the penalties a significant source of federal revenue. Contrary to some initial reactions, the employer responsibility requirement is not a critical factor in meeting the goals of the law.
Taxing Private Equity Funds and Their Partners: A Debate on Current Law Posted: June 25, 2013
The following is the text of a debate that occurred between Rosenthal and Needham at the May meeting of the American Bar Association Section of Taxation in Washington regarding the proper tax treatment of private equity funds and their partners under current law. The introduction should be attributed solely to Rosenthal. The views expressed by Rosenthal are his own and do not necessarily reflect the views of the Tax Policy Center, the Urban Institute, or the Brookings Institution. The text of the debate has been edited for purposes of clarity and print.
Finding Just the Right Tax Rate Posted: May 22, 2013
In a contribution to the New York Times' Room for Debate, Kim Rueben argues if the tax rate for marijuana is too high, people will continue to buy weed from the guy on the street. However, setting the tax rate too low leaves revenue on the table and use might boom.
Apprenticeships Could Help U.S. Workers Gain a Competitive Edge
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In this Washington Post commentary, Robert Lerman and Stuart Eizenstat argue that the U.S. manufacturing sector is poised for a comeback, but faces serious workforce challenges. To avoid squandering the opportunity to sustain a manufacturing resurgence, the U.S. must match the quality and quantity of skills training achieved in many other countries. One way to do this is a 21st-century apprenticeship program. By training youth and adults through a combined work-based learning and classroom instruction program leading to a recognized and valued occupational credential, apprenticeships can increase employment, while insuring a close match between the skills learned and the skills required.
Poverty in America: How We Can Help Families Posted: May 08, 2013
In this commentary for BlogHer.com, Urban Institute fellow Olivia Golden discusses a two-generation policy agenda that can help promote young children's development and low-wage workers' economic stability, which should start with a national focus on the first year of life.
Taxing Private Equity Funds as Corporate 'Developers' Posted: January 21, 2013
Private equity funds manage vast amounts of money: $2.5 trillion in 2010, much more than the $100 billion in 1994. They earn immense profits, largely from selling the stock of acquired and improved companies. This article focuses on the character of the funds' profits. It recommends that the IRS write new regulations to treat the funds' profits as ordinary income in light of the law, Congress's original intent, and tax policy.
Is the Trillion-Dollar Platinum Coin Clever or Insane? Posted: January 09, 2013
In a contribution to CNNMoney, Donald Marron argues that minting a $1 trillion platinum coin if Congress refuses to raise the debt ceiling sounds crazy. But it might actually work if done in smaller denominations.
One Policy Change, Please: Remove the Fiscal Cliff Scenario Posted: December 17, 2012
The president must call congressional leaders and top members of the major taxing and spending committees to a summit that agrees to enough deficit reduction to stabilize the debt-to-GDP ratio by 2024, Rudolph Penner declares in a commentary in The International Economy journal.