Evidence-based policy offers big returns, why risk adjustment is crucial for health insurers, and regulatory agencies face uncertainty.
            
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January 31, 2017

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Republican U.S. presidential nominee Donald Trump looks out at Lake Michigan during a visit to the Milwaukee County War Memorial Center in Milwaukee, Wisconsin August 16, 2016. REUTERS/Eric Thayer     TPX IMAGES OF THE DAY      - RTX2LC44

Regulation

Congress could eliminate courts' deference to regulatory agencies, but would it matter? New research from Connor Raso for the Series on Regulatory Process and Perspective, looks at the possible outcomes for oversight of regulatory agencies if Congress passes a law overturning the most cited administrative law case, Chevron v. NRDC.

Social Policy

Should government control what low-income people eat? Following the release of a Department of Agriculture study revealing that soft drinks are the number one commodity purchased by Supplemental Nutrition Assistance Program (SNAP) recipients, Diane Schanzenbach argues that efforts to restrict the consumption of unhealthy foods are best served by taxing them, not by imposing restrictions on what recipients can buy.

Health Care

Why risk adjustment is a crucial component of individual market reform. Writing for a new series on health policy solutions from the Schaeffer Initiative, Erin Trish says including risk adjustment in any ACA replacement plan will combat disincentives to provide coverage for sicker patients. However, some standardization of health plan offerings will be needed for the system to function effectively.

Fiscal Policy

How will the Fed’s interest rate policy respond to fiscal stimulus? With economic markets expecting a wave of fiscal stimulus in the form of tax cuts and increased government spending, the Hutchins Center Explains series assesses scenarios where the Federal Reserve might raise interest rates faster than it otherwise would.

Possible links between the EITC and a carbon tax. New research by Adele Morris and Aparna Mathur finds that the revenue from a carbon tax could be enough to expand the Earned Income Tax Credit to childless workers with little harm to low income households, and can create net benefits for the lowest income deciles while improving incentives to work and providing environmental benefits.

Upcoming Events

Identifying a fiscally responsible approach to funding infrastructure
Tuesday, February 7, 2017, 8:30 AM - 10:00 AM EST

Fintech: How can government promote the good and protect against the bad (webcast available)
Wednesday, February 8, 2017, 9:00 AM - 11:00 AM EST

What worked and what didn’t in Obamacare insurance markets? (webcast available)
Thursday, February 9, 2017, 9:00 AM - 12:00 PM EST

Pursuing regulatory excellence: Brexit, Trump, and beyond
Thursday, February 16, 2017, 9:00 AM - 10:30 AM EST

This Week's Economic News

What would a 20 percent tax on imports from Mexico mean for consumers? After Donald Trump suggested a tariff on Mexican goods as a possible source of funding for the construction of a U.S.-Mexico border wall, William Gale told USA Today that “the irony of putting a tariff on Mexican goods is that, to the extent it raises consumer prices in the U.S., consumers will be paying for the wall, not Mexican producers.” Appearing in a Reuters video, Gary Burtless claimed that the “total economy will grow a little more slowly [and your average consumer will] pay higher prices for things like fruits and vegetables, inexpensive motel stays, or other things produced by industries where illegal immigrants are an important source of labor."

A reading of the GOP’s top economic priorities. Appearing on Bloomberg Daybreak, Alice Rivlin discussed what the size of the U.S. deficit could mean for GOP fiscal policy wish lists, and a potential bipartisan solution for the Obamacare repeal and replace efforts.

Las Vegas wants to lure the Oakland Raiders with a $1.9 billion stadium. In an Economist article about the costly stadium Las Vegas seeks to build in hopes of enticing the Oakland Raiders to relocate, Ted Gayer's criticism of the Tax Reform Act of 1986 is cited. Gayer's research finds that "the federal government has subsidized newly constructed or majorly renovated professional sports stadiums to the tune of $3.2 billion federal taxpayer dollars since 2000."

Treaties and 'Trumpnomics.' David Wessel appeared on Bloomberg Markets to discuss the Trump administration’s executive action withdrawing from the Trans-Pacific Partnership, tax reform efforts, and future appointments to the Federal Reserve.

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