Our Economic Weaknesses Revealed by COVID-19 and What We Can Do - - PowerPoint PPT Presentation

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Our Economic Weaknesses Revealed by COVID-19 and What We Can Do - - PowerPoint PPT Presentation

Aug 30, 2023 153 likes •418 views

Our Economic Weaknesses Revealed by COVID-19 and What We Can Do about It ECONOMIC OPPORTUNITY INSTITUTE MAY 22, 2020 OPPORTUNITYINSTITUTE.ORG US least prepared of any wealthy country Unlike peer nations, U.S. lacks: Universal health

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Our Economic Weaknesses Revealed by COVID-19 – and What We Can Do about It

ECONOMIC OPPORTUNITY INSTITUTE MAY 22, 2020

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US least prepared of any wealthy country

Unlike peer nations, U.S. lacks:

  • Universal health coverage
  • Universal paid leave standards
  • Strong public support for child care
  • Strong regulatory and social safety net

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Crisis exacerbated by policy choices

Policymakers have perpetuated:

  • Growing income inequality
  • Tax breaks for wealthy + disinvestment in people and infrastructure
  • Distrust of government
  • Institutional racism and anti-immigrant policies

OPPORTUNITYINSTITUTE.ORG

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WA advocates have won strong workplace standards

  • Strong minimum wage
  • Paid sick & safe leave
  • Paid Family & Medical Leave
  • Overtime protections

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But rising income inequality leaves many behind

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46% 272% 53% 46% 34% 13%

1945 to 1973 1973 to 2007 2007 to 2015

Share of Income growth to Top 1%, WA

Top 1% Bottom 99%

Source: EPI, The New Guilded Age, 2018

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Racial inequity evident in wealth gap

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Source: US Census Bureau, Survey of Income and Program Participation, 2014 Panel, Update Nov 2017

$132,483 $9,211 $112,250 $12,458

White Black Asian Latinx

Median net worth of households, US 2014

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Single moms and young kids at high risk of poverty

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12.1% 11.1% 6.3% 7.8% 40.2% 43.9%

Washington King

WA families in poverty, 2018

All families Married couples, child under 5 Single mom, child under 5

Source: US Census Bureau, American Community Survey 2018

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Washington has most regressive tax system of any US state

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18% 11% 3% bottom20% middle 20% top 1%

Share of income to state & local taxes in Washington

Source: Institute on Taxation and Economic Policy, 2018

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Biggest source of state revenue is most regressive, on shrinking part of economy

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5.5% 3.6%

0% 1% 2% 3% 4% 5% 6% 1979 1983 1987 1991 1995 1999 2003 2007 2011 2015

Taxable retail sales as % of state personal income

Source: Washington Economic and Revenue Forecast Council data

Sales 51%

B&O 19% Other buisness 6% Property 14% Sin 4% Other 6%

State General Fund Revenue

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State budget is declining relative to income

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Source: EOI analysis of OFM and BEA data. 2020-21 based on House budget

6.6% 5.8% 5.2%

0% 1% 2% 3% 4% 5% 6% 7%

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

WA General Fund as Share of State Personal Income

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Between 2008 and 2011:

64,000 people lost health coverage through the Basic Health Plan, 155,000 on wait list; 180,000 lost dental, vision, podiatry, and other services through Medicaid; 120,000 faced drastically reduced preventive mental health services; 50,000 low-income seniors lost assistance covering prescription drugs; 40,000 seniors and people with disabilities had cuts in the home health; 46,000 women lost family planning services, $23 million cut Maternity Support; 45% reduction in per capita funding for alcohol and substance abuse disorder treatment by 2017, after continuing declines

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Across the board state cuts:

  • 23,000 families lost TANF in 2011
  • 20,000 who couldn’t work due to disability lost income support
  • UW tuition increase 75% 2007-2012
  • 145,000 eligible students denied State Need Grants 2009-2013
  • K-12 class sizes increased
  • Prisons to parks cut
  • Thousands of school employees and other public servants lost jobs; those

remaining lost take home pay

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COVID Pandemic: Unemployment is unprecedented

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6,548 14,154 128,962 170,063 143,241 82,435 137,605 100,762 109,425 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000

7-Mar 14-Mar 21-Mar 28-Mar 4-Apr 11-Apr 18-Apr 25-Apr 2-May

in week starting

New WA UI claims

Source: Washington Employment Security Dept.

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COVID job losses felt unevenly

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20,000 40,000 60,000 80,000 100,000 120,000 Accommodation & food service Construction Health care Retail Manufacturing Arts & rec Prof'l & tech Information

1st-time UI claims, Mar1-Apr 18

Source: WA Employment Security Dept.

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Sampling of occupations applying for UI

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4,000 8,000 12,000 16,000 Dental hygenists & assistants Hairdressers & stylists Childcare workers & preschool teachers Taxi drivers & chauffeurs

Source: WA Employment Security Dept.

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Lost job = lost health coverage

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Source: https://www.ofm.wa.gov/sites/default/files/public/dataresearch/healthcare/healthcoverage/COVID-19_impact_on_uninsured.pdf

467,734 502,324 521,764 892,247

6.2% 6.6% 6.7% 11.5%

0% 2% 4% 6% 8% 10% 12% 14% 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1,000,000 2018 2019 2020 pre-COVID-19 2-May-20

Uninsured in Washington

number percentage

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Newly unemployed lost their insurance

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10.2% 51.8% 54.2% 10.7% pre-COVID 2-May

uninsured Employment-Based Insurance

Source: WA Office of Financial Management

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Washington paid leave minimums

PAID SICK & SAFE LEAVE

  • At least 1 hr for every 40 hrs

worked

  • Full pay via paycheck
  • Enforced by Dept. Labor &

Industries, Seattle, Tacoma

  • C.b.a. or employer policy may

provide additional PAID FAMILY & MEDICAL LEAVE

  • 12 to 18 weeks
  • Eligibility: 820 hours work in

past yr

  • Social insurance program
  • 90% to 60% pay
  • Apply at paidleave.wa.gov

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What about undocumented immigrants?

  • Undocumented people have been

left out of federal relief packages – but they are more likely to lack health insurance

  • Testing and treatment for COVID-19

will not count against you in public charge test

  • ICE won’t make arrests at health

facilities

  • Advocates are pressing for a

Washington Worker Relief Fund

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Washington can raise progressive revenue

2017-2019 Fiscal Year Average % Reduction in Taxes* Revenue Decrease/Increase B&O 8,751,681,000 $ 4,375,840,500 $ 25% 1,093,960,125 $ Sales 21,488,340,000 $ 10,744,170,000 $ 25% 2,686,042,500 $ Property 5,108,989,000 $ 2,554,494,500 $ 25% 638,623,625 $ Total Decrease in Revenue 4,418,626,250 $

New Taxes

Tax Revenue Millionaire Tax 4,203,964,350 $ CEO Tax 853,356,867 $ Estate Tax 16,855,785 $ Inheritance Tax 517,280,967 $ Billionaire Tax 4,415,000,000 $ 10,006,457,969 $ 5,587,831,719 $ 2,000,000,000 $ 3,587,831,719 $ Net Revenue with universal B&O decrease Anticipated Drop in Annual Revenue Net Revenue with universal B&O decrease after Drop in Revenue

Tax Reductions

1% Intangible Property Tax on Property in Excess of $1 billion Total revenue from new taxes Income Tax above $1,000,000 SB 6017 - Executive Compensation Tax, amended to start at $137,700 SB 6581, amended to include % of charitable contributions Description

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We can make a new world from the ashes of COVID 19:

  • Expand grants for child care and small

business recovery

  • Guarantee universal health coverage and affordable access to care
  • Include immigrant workers and families
  • Push for strong state stimulus – NO to austerity
  • Rebuild economy to promote equity, worker power, small businesses and

resiliency