President-elect Donald Trump’s promise to carry out the largest mass deportation effort in U.S. history would wreak havoc on Social Security. Undocumented workers paid an estimated $25.7 billion in Social Security taxes in 2022, despite not being eligible for the popular program, according to a recent analysis from the Institute on Taxation and Economic Policy. The Washington Post’s Tara Siegel Bernard explains:
(I)f the White House does follow through (with mass deportations), economists project a broad drag on the economy — and it could cost Social Security roughly $20 billion in cash flow annually, according to actuaries at the Social Security Administration, which sends benefits to 68 million Americans each month, totaling $1.5 trillion last year. Social Security has faced a financing shortfall for years, partly because of demographic shifts. Falling birthrates mean fewer people are paying into the program, thousands of baby boomers are retiring daily, and retirees are collecting benefits for longer periods.
Louisiana teacher workforce grows
Louisiana’s teacher shortage improved for the second straight year, as fewer teachers left the classroom and more prospective educators completed certification programs. That’s according to new data from the Louisiana Department of Education. The Times-Picayune | Baton Rouge Advocate’s Elyse Carmosino breaks down the numbers:
The share of educators exiting traditional school systems decreased by two percentage points in the 2023-24 school year, dropping from 15% the prior year to 13%, according to data in a report released by the Louisiana Department of Education on Thursday. The figures exclude teachers in charter schools. During the 2022-23 academic year, the most recent available, the number of individuals completing state-approved teacher preparation programs increased for the first time in more than a decade. That year, 1,776 teachers finished a program — a 13% increase over the year before.
Why poor American kids become poor adults
Every child, regardless of their ZIP code or parent’s income level, deserves a path to economic mobility. But American children who are born into poverty are more likely to live in poverty as adults than their counterparts in Denmark, Germany, the United Kingdom and Australia. Zachary Parolin, associate professor at Bocconi University, writing in a guest column for the Atlantic, explains how these countries do a better job of providing public benefits that reduce poverty’s lingering consequences:
Imagine a resident of the U.S. and a resident of Denmark who each grew up spending, say, half of their childhood in poverty. Our study finds that both children will be less likely to pursue higher education or work full-time in adulthood compared with children who didn’t grow up poor. But the Dane is more likely to receive unemployment benefits, means-tested income support, or a child allowance and is therefore far less likely to live in poverty as an adult. This tax-and-transfer insurance effect—or the role of the state in reducing adult disadvantages that stem from childhood poverty—matters more than other oft-studied characteristics, such as parental education or marital status, in shaping the U.S. disadvantage compared with peer nations.
Growth in Medicare Advantage raises concerns
Medicare Advantage is a highly lucrative market for insurers that now enroll half of all Medicare beneficiaries. While the private health plans have been in the crosshairs of the Biden administration for misleading marketing and billing practices, it’s unclear if President-elect Trump will continue the heightened scrutiny. A new report from the Center on Budget and Policy Priorities explains why the growth in Medicare Advantage plans should raise concerns:
Congress’s Medicare Payment Advisory Commission (MedPAC) estimates that MA payments in 2024 were 22 percent above traditional Medicare — a difference that amounts to $83 billion in annual spending.[1] Much of these overpayments benefit the MA plans rather than their enrollees. MA plans receive a fixed payment for each member, regardless of services delivered. That gives plans a financial incentive to restrict care once people are enrolled, sometimes resulting in service delays or denials. MA enrollees may also face inadequate provider networks, which limits access to timely, needed care and imposes burdensome travel.
Number of the Day
$8.9 billion – Amount of tax revenue the United States would lose annually for every 1 million undocumented workers that are sent out of the country. (Source: Institute on Taxation and Economic Policy)