NCPA - National Center for Policy Analysis
NCPA - National Center for Policy Analysis
Barry is a Senior Economist with the National Center for Policy Analysis, one of the most influential think tanks in America today.

The National Center for Policy Analysis (NCPA) is a nonprofit, nonpartisan public policy research organization, established in 1983. The NCPA's goal is to develop and promote private alternatives to government regulation and control, solving problems by relying on the strength of the competitive, entrepreneurial private sector. Topics include reforms in health care, taxes, Social Security, welfare, criminal justice, education and environmental regulation.

NCPA Motto - Making Ideas Change the World - reflects the belief that ideas have enormous power to change the course of human events. The NCPA seeks to unleash the power of ideas for positive change by identifying, encouraging, and aggressively marketing the best scholarly research.

Daily Policy Digest

Provided courtesy of: NCPA

Daily Policy Digest

The Federal Government Should Stay Away From School Choice
20 Apr 2015 07:00:58 CDT -

In a memo earlier this month, two Third Way analysts vigorously argued that Congress should not include a federal voucher program as a part of the Elementary and Secondary Education Act (ESEA) reauthorization. However, the five reasons they give to oppose federal vouchers range from flawed to erroneous.

Nevertheless, though the evidence suggests that school choice programs benefit students and are popular among voters, Congress should leave it to the states.

Here is how Third Way is wrong on school vouchers:

  • They claim there is "little convincing evidence that students who receive vouchers are better off for it." School choice is one of the most-researched education policies, and the best studies overwhelmingly find positive results for some or all categories of participants. Eleven of 12 random assignment studies found statistically significant positive outcomes for students who won a school voucher or scholarship lottery relative to students who entered the lottery but did not win.
  • Another claim is that it is "impossible to tell how voucher students or specific groups among them, like students with disabilities or students of color, are faring from school to school—let alone compared to their non-vouchered peers." The truth is, school choice makes schools directly accountable to parents who have the ability to vote with their feet if they school fails to meet their needs.
  • Third Way asserts that "letting the money follow the child" would "divert limited … resources away from districts needing financial assistance the most." However, the available evidence suggests that the positive impact of choice and competition outweighs any potentially negative impact from lower resources.

With its proven policy success and public support, it's understandable that a federal voucher program is politically tempting. Yet politicians should resist the temptation. School choice advocates are winning in state after state.

Source: Jason Bedrick, "Leave School Choice to the States," Townhall, April 16, 2015

For more on Education Issues:

Fannie and Freddie Are Back
20 Apr 2015 07:00:57 CDT -

After the housing collapse, and the bankruptcy of Fannie Mae and Freddie Mac, officials in Congress and the administration argued the two giants' massive role must be reduced in the housing market, with numerous hearings in Congress on how to wind down these two government-sponsored enterprises.

Banks, which aided and abetted the housing bubble, were hit with hundreds of billions of dollars in losses due to defaults and write-downs, and the U.S. economy suffered a severe downturn more than seven years ago.

But now Fannie and Freddie are back. Here is what they are doing:

  • They just debuted their new HomePath Ready Buyer Program, which lets first-time homebuyers get up to a 3 percent rebate of a home's purchase price if they buy a Fannie Mae property.
  • The new program could create $4,500 in savings on a $150,000 home for first-time buyers.
  • In addition to the 3 percent rebate, Fannie Mae will refund the cost of the homebuyer education course.  

All part of the Obama Administration's push to make homeownership affordable to a bigger group of borrowers. The government now wants to expand the opportunity for homeownership to credit-worthy borrowers who have enough income to afford a loan, but have not saved enough for a larger down payment.

But is this new effort good for taxpayers and the economy, or is this similar to programs that led to the subprime mortgage crisis and housing crash? Will taxpayers be on the hook for another mega-bailout, given that Fannie and Freddie combined were one of the biggest bailout cases of all, at $187.5 billion?

Jeb Hensarling, chairman of the House Financial Services Committee, has said that the Administration's new push is "an invitation by government for industry to return to slipshod and dangerous practices that caused the mortgage meltdown in the first place and wrecked our economy" and that they "must be rejected."

Source: Elizabeth Macdonald, "Fannie and Freddie Restart Risky 'Affordable Housing' Programs", Fox Business, April 17, 2015. 

For more on Economic Issues:

Borrowing Rates Could Soon Be on the Rise
20 Apr 2015 07:00:56 CDT -

The moment U.S. Central Bank chief Janet Yellen makes the decision to increase borrowing rates will be a massive economic event. The prospect that higher interest rates in the world's largest economy could come this year has already sent the dollar surging against the pound and euro. It has also fuelled fears of a meltdown in countries that have borrowed heavily in the U.S. currency.

Borrowing is inherently risky, all the more so when the interest rate can change at short notice. Higher costs for those that have borrowed in dollars could cripple companies in Brazil and Turkey that were enticed by cheap credit to fund a new factory or office building, or just to pay the wages.

But while it is almost certain Turkey, Brazil, Russia and many others that have seen their businesses and governments borrow heavily in dollars to maintain their spending will suffer higher borrowing costs courtesy of Yellen, it seems unlikely funds in Europe now would opt to send billions of euros to banks in developing world economies such as Turkey, even when the returns are higher. That is because Turkey would be a risk too far when there are safe havens such as the United States starting to offer a return on totally safe investments like Treasury bonds.

Maybe Yellen will look at U.S. unemployment and consumer spending data at the Fed's meetings this month and in mid-June, and decide America remains too weak to withstand a rate rise. If she does, plenty of countries will cheer. Yet all the signals point towards a rise, with potential turmoil ahead.

Source: Phillip Inman, "Markets Face New Threat As US Federal Reserve Ponders Interest Rate Rise," The Guardian, April 18, 2015. 

For more on Economic Issues:

Obama Looks to Paris to Leave His Climate Change Legacy
20 Apr 2015 07:00:55 CDT -

In his State-of-the-Union address, president Obama again confirmed that "saving the climate" remains one of his top priorities. Yet an official December 2014 confab in Lima, Peru did not really conclude anything — certainly no binding Protocol to limit emissions of carbon dioxide (CO2) — but it "kicked the can down the road" to the next international gabfest in Paris, scheduled for 2015. 

It is not at all difficult to predict what will happen in Paris; in fact, it is a "no-brainer." There will be an agreement of sorts, but it will be essentially meaningless. Yet it will be hailed as a "breakthrough" by the White House and thus form an important part of the "Obama Legacy." Meanwhile, there has been no significant warming for the past 18 years.


  • The climate continues to plateau; no significant warming has occurred in nearly 20 years—in spite of a greater than 10 percent increase in CO2.
  • Scientists, both alarmists and skeptics, are still trying to explain this "pause" — as it is sometimes called. The word Pause denotes an expectation that the climate will again warm — although no one has any acceptable hypothesis as to when the warming might resume, if ever.

The world is looking forward to the 21st annual COP (conference of the parties to the global climate treaty), which will be held in December of 2015. It is hoped by many that Paris will end up with a climate protocol that will continue and even surpass the Kyoto Protocol of 1997, which expired in 2012 and achieved practically nothing except to waste hundreds of billions that might have been better spent addressing genuine world problems—without accomplishing its main goal of reducing global emissions of the much-maligned greenhouse gas CO2.

Source: S. Fred Singer, "Obama Expected to Bind US to CO2 Reduction at Paris Climate Meeting This Year," Independent Institute, April 17, 2015. 

For more on Environment Issues:

Obama's Education Budget Could Hit Taxpayers Hard
17 Apr 2015 07:00:54 CDT -

President Obama's budget grows federal intervention in nearly every aspect of education, from preschool (including spending on programs for "expectant mothers") through "free" community college.

The budget increases spending on programs operated by the U.S. Department of Education by more than 5 percent, from $67.1 billion (2015 enacted level) to $70.7 billion — a $3.6 billion increase. Two of the most significant expansions of federal intervention in education come in the form of "free" preschool and childcare, provided by Washington, and "free" community college, also footed by federal taxpayers.

Here is Obama's preschool budget request:

  • $750 million in Preschool Development Grants (up from $500 million currently).
  • $907 million for early intervention preschool (up $115 million from last year).
  • A new $15 million in funding dedicated to autism programs; and increased spending on the Child Care Development Block Grant program to the tune of $266 million.

The budget also includes the Administration's "Expanding Access to Quality Child Care for Working Families" proposal, which aims to spend $82 billion in mandatory funding over 10 years to provide child care to all low-income and moderate-income families with children ages three or younger.

The federal government currently operates 45 early learning and childcare programs. Taxpayers spend more than $20 billion annually to finance them. And in all, between two-thirds and three-quarters of four-year-old children are already enrolled in some form of preschool or care program. Efforts to grow government preschool would be duplicative of existing options, and, instead of assisting families with unmet needs, would create an unnecessary preschool subsidy for middle-income and upper-income families.

Source: Romina Boccia and Michael Sargent, "$4 Trillion and Counting: President Obama's 2016 Budget Presents a Vision of Government Largess," Heritage Foundation, March 26, 2015. 

For more on Education Issues:

Identity Theft Is Taking A Toll On Tax Refunds
17 Apr 2015 07:00:53 CDT -

The first tax deadline has now passed, and many individuals still needing extra time will file extensions.  But some who have electronically filed their returns are surprised to receive notice that a tax return for them has already been submitted — by somebody who is not the taxpayer.

This tax-related identity theft is a real and growing problem for the Internal Revenue Service (IRS) and for hundreds of thousands of taxpayers. Tax-related identity theft occurs when someone steals a person's Social Security number and uses it to file a tax return claiming a false refund.  These phony electronic filings, reporting false wage and tax withholding information, are typically made early in the year, before employers are required to provide data to the IRS (due in March) from which the IRS could reconcile the reported numbers and identify the false claims.

Taxpayers are unlikely to find out they have become victims of tax-related identity theft until they attempt to file a tax return, and learn that one has already been filed using their Social security number. Resolving the problem with the IRS and receiving the refund a tax payer is legally entitled to, can take the better part of a year.  The IRS says it assisted over 800,000 suspected victims of tax-related identity theft last year alone. According to the latest available data, the IRS lost an estimated $5.8 billion to fraudulent refunds in 2013, and stopped another $24.2 billion in false return refunds from being paid.

Source: Jeff Lerner, "Tax-Related Identity Theft — A Real and Growing Problem," National Center for Policy Analysis, April 15, 2015. 

For more on Tax and Spending Issues:

Health Policy Digest

Provided courtesy of: NCPA

Consumer Driven Health Care

Health Care Reform Tax Will Hurt Franchisees
04 Oct 2011 12:43:58 GMT - When the employer mandates go into effect in 2014, many franchised businesses will be motivated to reduce the number of locations and move workers from full-time to part-time status...


Saving Jobs from Health Reform's Harmful Regulations
04 Oct 2011 12:43:58 GMT - If the rate of health care cost growth had not exceeded general inflation, a typical family would have had $545 more per month in spendable income instead of $95 -- a difference of $5,400 per year...


Does Health Insurance and Seeing the Doctor Keep You Out of the Hospital?
04 Oct 2011 12:43:58 GMT - Gaining health insurance and using more primary care services leads to more hospitalizations as a result of physicians' discretionary decisions regarding aggressive and intensive treatment...


The Case for Competition in Medicare
04 Oct 2011 12:43:58 GMT - A well-functioning marketplace would set in motion the forces needed to transform American medical care into a model of efficient patient-centered care...


Potential Effect of Health Care Reform on Emergency Department Utilization Not Clear
04 Oct 2011 12:43:58 GMT - In 2010, 71 percent of emergency physicians said that they expected emergency department visits to increase due to the implementation of the Affordable Care Act...


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