The U.S. Census Bureau announced today that the national poverty rate fell from 15.0 percent in 2012 to 14.5 percent in 2013 - the first time the rate has fallen in eight years. The poverty rate for children under 18 also declined in 2013 for the first time since 2000 - from 21.8 percent in 2012 to 19.9 percent in 2013.

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WASHINGTON, D.C.—Many U.S.-based companies are in the process of reincorporating their headquarters to countries with lower corporate tax rates. This is commonly known as “inversions” or “expatriations” and takes place when a company merges or acquires a foreign company with the nearly exclusive purpose of paying lower corporate taxes.

Inflation-adjusted gross domestic product grew 1.9 percent in the United States during 2013, which is somewhat lower than long-term expectations for economic growth. Employment rose a relatively healthy 1.6 percent, but nearly 1.2 million fewer people have a job than before the recession. Most analysts expect better GDP growth during 2014 and anticipate employment will finally rise above the pre-recession peak sometime during the second half of 2014. Economic growth will improve because the short-term drag caused by sequestration and the debt ceiling debate has played through the economy, improvements in household balance sheets are allowing solid consumer spending increases, business investment is rising with better business equipment purchases and housing construction is healthier in many regions.

In December 2013, The Federal Aviation Administration selected six public entities and set a course that will lead to the development of unmanned aircraft systems and the economic,environmental, safety and security benefits that will accompany this research. Congress mandated the test sites to conduct research into the certification and operational requirements required to safely integrate unmanned aircraft systems into the national airspace over the next several years.

Fiscal conditions for states continued to moderately improve in the 2013 fiscal year. Revenue collections exceeded projections for the vast majority of states and spending from both state funds and federal funds experienced stronger growth in comparison to the 2012 fiscal year. Additionally, the number of states making midyear budget cuts remained low and states have continued to replenish their rainy day funds and reserves. In the 2014 fiscal year, states are expected to have continued positive revenue and spending growth. Revenue and spending growth rates, however, are expected to be slower than last year. States are cautiously optimistic that fiscal conditions will continue to slowly improve in the 2015 fiscal year and beyond, although challenges remain.

State fiscal and economic indicators continue to slowly improve as the effects of the Great Recession continue to linger. For more than a year and a half, state tax collections have consistently grown and states have invested in rainy day funds. On a per capita basis, state general expenditures declined slightly in 2012 over 2011 levels and education and public welfare remained the largest components of state spending in 2012—65.5 percent.

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Every legislature and governor relies on a revenue forecast to build a state budget, but as a recent study shows, the process itself can vary considerably around the country. Indiana and Iowa were among the U.S. states that employ all five of the Center on Budget and Policy Priorities’ “best practices” in revenue forecasting.
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With its cluster of farming, industry leaders such as DuPont Pioneer and John Deere, and a large land-grant university, central Iowa is already a hub of economic activity centered on agriculture and bioscience. But state, local, business and university leaders believe the region still has much untapped potential.

Their response: Join together on a new Cultivation Corridor initiative, which creates new partnerships among regional leaders in economic development, education and bioscience and aims to market central Iowa as the home of“science that feeds the world.”

If successful, the initiative will also help grow the entire Iowa economy by drawing new investments to the state and attracting and retaining talent and business.

Two cities in California—San Francisco and Berkeley—will be presenting voters with soda-tax initiatives in the upcoming November election. Soda and sugar-sweetened drinks such as sports drinks and energy drinks would be taxed, although infant formula, nutritional drinks, and diet drinks would not be taxed. Michael F. Jacobson, the executive director of the Center for Science in the Public Interest, said in an article in the New York Times that the soda industry has spent over $117 million since 2009 to combat soda taxes in the United States and is now paying attention to San Francisco and Berkeley.

Standard & Poor’s Ratings Services’ (S&P) recent report examined the effects of the widening income gap in the US and concluded that rising share of income to the wealthiest Americans has resulted in less tax revenue for the states. The implications of rising income inequality for the states vary.  

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