Category: Folbre

Nancy Folbre, economics, writes in the Economix blog in the New York Times about sagging job and income growth in the middle class in recent decades. She says this trend threatens to derail reaching the American dream for many families. (New York Times, 6/14/10)

June 14, 2010
The Sagging of the Middle Class
By NANCY FOLBRE

The fact that middle-wage jobs, rather than low-wage jobs, are declining suggests it is not the overall level of skill but the specific type of skill that matters. In fact, skill itself may be less important than other characteristics of a task, such as how easily it can be automated or outsourced at some point in the future.

Alan Blinder of Princeton observesthat some jobs are simply more outsourceable than others because they don’t require physical proximity or person-specific skills. The combination of rapid technological change and increased global trade in services has effectively devalued skills that many individuals spent considerable time and effort to acquire.

Consider, for instance, the possible extinction of travel agents and the gloomy job prospects facing journalists. The expansion of online education sites replete with videotaped lectures by superstar professors will almost certainly reduce demand for a skill I labored to develop for many years — lecturing to large classes of economics majors.

Nancy Folbre’s book, Saving State U:  Fixing Public Higher Education, was reviewed by the Inside Beat.   The book, which makes a case for strengthening public support for higher education, received a favorable review.  “Folbre’s writing, in both style and context, doesn’t pull any punches, which is really refreshing, especially in a debate such as this. Using hard data about tuitions and other incurred costs, she stresses the need for government funding in state universities. Her accessible style and clear-cut ideas help to take a complex issue that affects thousands across the nation and break it down into logical, effective arguments.”

In a recent NY Times Economix blog, Nancy Folbre, UMass Amherst economics professor, calculates tax payback year.  This calculation is “the number of years beyond age 21 that it takes average taxpayers to fully repay the government (and their fellow taxpayers) for the public funds expended on them in their first 21 years.”  She argues that although some dislike paying taxes, it is important to understand that the government pays for us.  Paying taxes after the age of 21 is, in a sense, paying back the money that the government invested in us while we were young.  The benefits we receive from the government, for much of our lifecycle, far exceed the taxes we pay.

April 5, 2010
Tax Payback Year
By:  Nancy Folbre

It takes more than 17 years for average taxpayers simply to repay what older taxpayers invested in them.

You don’t have to take my word for it. If you’re willing to do some fairly detailed research and plug it into a spreadsheet, you can look back and estimate what the government has spent, to date, on you.

Then you can look forward and estimate what you expect to get from the government in health insurance, retirement and other benefits.

Then you can estimate your net taxes in each year — the difference between what you pay and what you get — and see how it varies over time.

Whether or not you like what you see, it will look very different than a picture based on taxes alone.

The Tax Foundation complains that Americans will pay more in taxes in 2010 than they will spend on food, clothing and shelter combined.

But young Americans and old Americans, in particular, will get more in benefits than they pay in taxes.

Let’s remember that we were all once young and hope eventually to grow old.

In a March blog entry, Nancy Folbre, UMass Amherst economics professor and NY Times Economix blog contributor, analyzes taxes paid and benefits received between parents and non-parents.  Overall, non-parents pay more in net taxes than parents, until you calculate the future tax contributions on their children.

March 29, 2010
The Present Value of Producing Future Taxpayers
By NANCY FOLBRE

Let’s put this in more personal terms.

Prof. Douglas Wolf of Syracuse University, the first author of this paper, is a parent. I am not. Over my lifetime I am likely to pay more in taxes relative to the benefits I receive than he does.

But since he has devoted substantial resources to raising children, he has indirectly generated the net taxes they will pay in the future.

He has doubtless derived considerable satisfaction from his commitment to his children, which was not influenced by his calculation of possible “fiscal externalities” or benefits to other taxpayers.

But his commitment benefits me, because his children — whom I’ve never met — will help pay for the public transfers and services I anticipate receiving in my old age.