Taxpayer's Tab: Good Luck to Our Summer Interns!

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Good Luck to Our Summer Interns!

2014 Friedman Legacy Tax Poll ResultsThis week, National Taxpayers Union Foundation says goodbye to our 11 summer interns. What did they accomplish this summer?

Communications: Two Foundation interns worked hard to develop their writing skills and find ways to better communicate the findings of the BillTally project. They wrote blog posts and special media messages while tracking how the media reports our research. Thanks to Jihun and Sam, NTUF was able to reach even more taxpayers across the country with how local Representatives proposed to change spending.

Research: Many interns worked throughout the last two months on NTUF's BillTally project in much the same way our full-time researchers do. Nine interns learned how to read through oftentimes complex proposals that could change federal spending by many billions of dollars. Some of our Associate Policy Analysts called Capitol Hill offices or agency budget divisions in order to score the bills introduced by Members of the House and Senate. Thanks to the efforts of Alex, Catherine, Daniel, Gordon, Ian, John, Kelly, Paul, and Steve, NTUF was able to score thousands of measures and greatly improve our fiscal transparency efforts.

What can you do to help NTUF? We are always in need of interns to help score the thousands of bills that Congress introduces each year. Help us by referring current students and recent graduates to our Opportunities page. You can also make a tax-deductible contribution to NTUF. It takes a lot of resources to host our interns, but with your help, they'll have the tools they need to help us produce accurate, timely research and keep our members informed on how Congress is spending their tax dollars.


Most Expensive Bill of the Week

The Bill: H.R. 4904, the Vegetables Are Really Important Eating Tools for You (VARIETY) Act of 2014

Cost Per Year: $824 million ($4.1 billion over five years)

Congressman Matt Cartwright (D-PA)As we noted in last week’s edition of The Taxpayer’s Tab, the prevalence of obesity -- especially among children and low income households -- is a contributing factor to rising health care costs. Data have shown that low income populations tend to consume more so-called “junk food,” choosing cheaper, ready-made food over more expensive but healthier options like fresh fruits and vegetables. Many lawmakers would like to change that and have proposed ways to encourage healthy diet and lifestyle habits through public programs and funding.

The Supplemental Nutrition Assistance Program (SNAP) is one such program designed to provide financial assistance to low income households for eligible grocery items. Originally known as the food stamp program, SNAP was renamed in 2008 to emphasize a focus on healthy eating. In 2013, the program assisted over 47 million people and received $82.5 billion in federal funding; 92 percent of that amount was used to provide benefits, while the rest was used to cover administrative costs (which are split between the federal government and states). The average SNAP benefits recipient received $133 per month, or about $4.45 per day, though each household is eligible for differing amounts depending on its size and income.

Many critics of the program’s funding and benefit levels have participated in so-called “SNAP challenges,” in which they try for a week or more to eat all of their meals on a budget of $4.50 per day. The challenges are designed to give participants a sense of how difficult it can be to shop for quality food on a limited budget, even though the program is designed to supplement rather than fully cover recipients’ food purchases.

Some legislators on Capitol Hill have suggested that an experimental program that was tested in Hampden County, Massachusetts could help SNAP recipients buy higher quality food. Congressman Matt Cartwright (D-PA) and Congresswoman Rosa DeLauro (D-CT) introduced the Vegetables Are Really Important Eating Tools for You (VARIETY) Act to extend the Healthy Incentives Pilot (HIP) to all SNAP recipients. Under HIP, SNAP recipients in the County earned refunds equal to 30 cents out of every dollar they spent on certain fruits and vegetables. In the time that HIP operated (November 2011 to December 2012), administrators observed a 25 percent increase in fruit and vegetable consumption among participating households. The average HIP household received an extra $3.64 each month based on their purchase of specified fruits and vegetables.

Rep. Cartwright said that the Act “aims to broaden the benefits of HIP to all SNAP participants by empowering low-income citizens to purchase more healthy foods for themselves and their families.” While the HIP program was successful in boosting fruit and vegetable consumption among those who were observed, accompanying studies did not confirm whether participants’ health statuses actually improved as a result.

According to information from the sponsors, expanding HIP to the entire SNAP program would require about $824 million in additional spending per year. capitol_dome_tinytaxtabhaticonalpha.png

The Bottom Line: The VARIETY Act would refund 30 cents of every SNAP dollar that program participants use to buy fresh fruits and vegetables. It would cost over $4.1 billion over five years.


Least Expensive Bill of the Week

The Bill: H.R. 5090, a bill to prohibit funds for the National Endowment for the Arts

Savings Per Year: $146 million (one-year savings)

Congressman Matt Salmon (R-AZ)Founded by Congress in 1965, the National Endowment for the Arts (NEA) is an independent government agency that partners with state and local governments, as well as philanthropic groups, in order to “[fund] and promote artistic excellence, creativity, and innovation for the benefit of individuals and communities.” It does so largely by offering grants to artists and creative communities in order to their work. The NEA funds projects ranging from modern dance performances to literary composition and preservation efforts. A recent search through the NEA website, for example, shows awards including a $10,000 grant to a Puerto Rican dance troupe in 2013, and another in that same amount to support the Arctic Chamber Orchestra’s 2002 tour throughout rural Alaska.

According to Americans for the Arts, 60 percent of nonprofit arts organizations’ revenues come from earned income (such as ticket sales, sponsorships, and fundraising events). Another 31 percent comes from private donations, including corporate gifts as well as support from individuals and artistic foundations. The remaining nine percent comes from federal, state, and local governments. NEA funding has varied over the years, from a low of $2.9 million in 1966 (the agency’s first year in operation), to a high of $176 million in 1992. In 2013 and 2014, the NEA received about $146 million in appropriations from Congress.

The NEA has its share of critics who point out that government funding of the arts is a relatively new phenomenon that does not clearly boost artistic output. This prompted the Reagan Administration to consider abolishing the Endowment altogether in the early 1980s, and there were more attempts to do so during both the 104th and 105th Congress. There is also the issue of whether involuntary contributions to creative projects leads to higher quality art. In some instances, backlashes have resulted when the project in question explores controversial subjects.

In that spirit, and as part of his “Shrinking Our Spending” (SOS) initiative, Congressman Matt Salmon (R-AZ) has introduced a bill that would prevent any and all funding for the NEA. According to a press release from his office, H.R. 5090 was introduced because even though “[t]here is no question that artistic expression should not be sanctioned or censored by government ... [the] government should not compel taxpayers to subsidize works they find objectionable.” NTUF scored the bill as a $146 million savings, based on NEA budget data. capitol_dome_tinytaxtabhaticonalpha.png

The Bottom Line: H.R. 5090 would prohibit funding of the National Endowment for the Arts, which is expected to receive $146 million in funding in 2014.


The Wildcard

The Bill: S. 2719, the Manufacturing Universities Act of 2014

Cost Per Year: $125 million ($500 million over four years)

Senator Chris Coons (D-DE)Manufacturing jobs have, historically, played a major role in U.S. economic growth. As recently as the 1970’s, nearly one in every four American workers held some sort of manufacturing job. That percentage has steadily declined since then, and plunged dramatically during the recent recession: in January of 2004, the manufacturing sector employed about 14.3 million Americans; by January of 2010, that number had plummeted to 11.5 million, a decrease of almost 20 percent. Although the manufacturing sector has been recovering to some extent, today there are only about 12 million jobs in the industry, leading many economists to wonder whether it will ever represent as much of the American labor force as it once did -- technological advances (see “Humans Need Not Apply”) and globalization are increasingly leading companies to outsource labor from other countries rather than invest in domestic workers, which is relatively more expensive.

In response to these trends, federal policymakers have been trying to encourage more hiring within the manufacturing sector. In 2009, as the recession reached its zenith, President Obama proposed his American Recovery and Reinvestment Act (ARRA), or the so-called “stimulus” bill. ARRA offered nearly $1 trillion in economic stimulus measures, and prior to the bill’s passage, officials from the Administration estimated it could result in 408,000 new manufacturing jobs in the fourth quarter of 2010 alone (in reality, over 968,000 were lost).

Earlier this year, the President introduced another measure designed to spur manufacturing job growth known as “manufacturing innovation institutes.” The program would authorize federal funding to support dozens of public and private universities and laboratories “to boost advanced manufacturing, strengthen our capabilities for defense, and attract the types of high-quality jobs that a growing middle class requires.” The White House announced that it was supporting innovation institutes in Chicago and Detroit with a total of $140 million in federal funding via the Department of Defense.

Congress has also considered how it can boost manufacturing employment, and Senator Chris Coons (D-DE) has introduced the Manufacturing Universities Act in hopes of doing just that. S. 2719 would authorize the federal government to provide $5,000,000 in grants per year to 25 American universities that it designates as “manufacturing universities.” These institutions would be required to use the funding to promote science and engineering programs of study that “emphasize manufacturing skills, incentivize partnerships with local manufacturers, increase internship and cooperative education opportunities for students, and help more recent graduates launch new manufacturing businesses.” The program would be administered by the National Institute of Standards and Technology, in cooperation with the Departments of Defense and Energy.

On the bill’s introduction, Senator Coons said “[t]he entire lifecycle of innovation, skills, and creativity in manufacturing has to include universities. ... Universities have a central role to play in continuing the cycle of innovation that is essential if American manufacturing is to continue its current recovery.” The legislation would authorize $125 million per year for each of the next four years. capitol_dome_tinytaxtabhaticonalpha.png

The Bottom Line: The Manufacturing Universities Act of 2014 would authorize $500 million to help colleges design engineering programs oriented towards manufacturing industries.