Goodman Institute
The Goodman Institute is a public policy research think tank founded in 2015. The organization is virtual, in the sense of having no employees. Its goal is to find the best scholars in the academic and scholarly world in key public policy areas and form a partnership with them. Institute scholars have been working with members of Congress on a variety of issues, especially health reform and tax reform. It has also produced research on entitlement programs and on issues affecting seniors and the changing role of women in the economy. It is beginning a new blog on environmental issues.
The budget for 2019 is approximately $1 million.
The organization was founded by John Goodman, who is best known as a health economist. In 1983, Goodman founded the National Center for Policy Analysis (NCPA) and served as its president for 31 years. The NCPA closed in July 2017 and many of the scholars who were previously associated with it are now involved with the Goodman Institute. Under “Our Accomplishments,” the Goodman Institute’s website lists Health Savings Accounts, Roth IRAs, automatic enrollment in 401(k) plans and the ability of seniors to receive Social Security benefits without penalty if they keep on working. Many of these accomplishments were produced by Goodman and his colleagues while they were at the NCPA.
Tax Center
The Republican tax plan proposed by Speaker of the House Paul Ryan and House Ways and Means Committee Chairman Kevin Brady in 2017 was based on the ideas of two Goodman Institute scholars: Laurence Kotlikoff and Alan Auerbach. Kotlikoff is the William Fairfield Warren Professor at Boston University. Auerbach is the Robert D. Burch Professor of Economics and Law at Berkeley. In July 2017 Kotlikoff presented a Capitol Hill briefing on the plan, sponsored by Chairman Brady..[1] A version of the proposal became law later that year.
One of the most contentious issues in corporate tax reform is: who gains as a result of reform? The answer to that question is very dependent on who pays the corporate income tax – an issue that has historically been unclear to economists because of inadequacy of the tools needed to answer it. However, in a 2013 National Bureau of Economics Research (NBER) Working Paper, Kotlikoff and his colleagues found that the corporate tax is almost totally borne by workers, not shareholders.[2] In a New York Times editorial Kotlikoff argued that workers would be the biggest gainers if we abolished the corporate income tax altogether.[3] In a Wall Street Journal editorial, Kotlikoff argued that Democrats and liberals should support tax reform just as enthusiastically as Republicans.[5]
Backgrounders on the Goodman Institute website summarize the Kotlikoff/Auerbach approach to analyzing fiscal policy and their approach to measuring inequality[6]
Kotlikoff and his colleagues have estimated the effects of changes in U.S. corporate taxation on every major country in the world and extended the estimates until the end of the century. These esitmates use United Nations demographic data and International Monetary Fund fiscal data for 17 large countries or combinations of countries that span the entire global economic system. The model has more than 3 million equations. It provides the most convincing evidence to date that the burden of corporate income taxation is borne by labor, not capital.[7]
Overall, the economist estimate that the proposed tax reform will lead to a massive inflow of capital (roughly $11 trsillion) and this inflow will raise the income of the average U. S. household by $4,000 a year..[8] These numbers have been used by the White House to defend tax reform on numerous occsasions.
Another study by Laurence Kotlikoff and his colleagues is available as a Federal Reserve Bank of Atlanta Working Paper.[1] It concludes that the average household in America can expect a lifetime gain of $25,322 from the tax reform law, measured in current dollars. Further, 98 percent of all families gain from the new law.
What share of the tax cuts went to the rich and the poor? The richest 1 percent received 9.3 percent of the total tax cuts, but they were previously paying 30.2 percent of all the taxes. The top 20% received 52.2 percent of the tax cuts, but they were previously paying 80.1% of the taxes. The bottom 20% got 3.3 percent of the tax cuts. But previously they were not paying taxes at all. In fact, they were receiving a 9.0 percent “refund.” As a result, the new tax system is more progressive than the one it replaced.
These results appear in a Goodman Institute-supported study by Laurence Kotlikoff, Alan Auerbach and Darryl Koehler.[2] The economists bent over backwards to give the critics the benefit of the doubt by assuming that all the benefits of lower corporate taxes go to shareholders, and they concluded that the reform is progress. If we accept Kotlikoff’s [JS1] findings that the benefits mainly go to labor, then tax reform is even more progressive than the results reported here.
Health Center
At a Rose Garden ceremony on June 15, 2019, President Trump announced that beginning next January, employers will be able to help employees obtain their own health insurance with pre-tax dollars. As John Goodman explained in a post at Forbes,[1] his is a big step toward personal and portable health insurance.
The Goodman Institute promoted this idea in many forums – in editorials,[4] in publications,[5] in legislation[6] and in advice to members of Congress. In the last several years, the only Republican plan to reform Obamacare that included personal and portable insurance was a bill sponsored by House Rules Committee chairman Pete Sessions and Sen. Bill Cassidy (with large input from John Goodman).[7] Health reform has been an enduring interest for Goodman and other health economists associated with the Goodman institute. In Characteristics of an Ideal Health Care System,[8] he identified ten ways in which government policies were creating the very problems many reformers want to solve. In “Designing Ideal Health Insurance,”[9] he showed how public policies were preventing the insurance market from meeting people’s needs. In the Journal of Legal Medicine, he argued for a do-no-harm approach– u
under which government policies that are causing problems would be repealed and replaced before any other reforms are considered.[9]
One of Goodman’s most important reform ideas is to replace all the ways government currently subsidizes health insurance through tax and spending programs with a universal, refundable tax credit – essentially giving every citizen a fixed number of dollars for health insurance. That idea was elaborated with Mark Pauly in Health Affairs[10] and it became the core health insurance plan endorsed by John McCain in his presidential run against Barack Obama in 2008.[11] The legislative vision of the McCain approach was introduced by Tom Coburn and Richard Burr in the Senate and Paul Ryan and Devon Nunes in the House of Representatives.
The idea also forms the core of a replacement plan for Obamacare. Beginning in 2015, Goodman helped House Rules Committee Chairman Pete Sessions (R-TX) and Sen. Bill Cassidy (R-LA) in 2015. The plan called for a universal tax credit for health insurance, personal and portable health insurance for employees and a flexible Roth HSA. In a post at the Health Affairs Blog, Sessions, Cassidy and Goodman argued that their plan is not only better than Obamacare, it would create universal coverage.[14]
In an article at the Health Affairs Blog, Goodman argued that there were six major problems in the Affordable Care Act that will not go away without major reform.[12] For example, the first problem is that people were being required to buy a health plan whose cost is expected to grow at twice the rate of growth of their income. These ideas were expanded into A Better Choice, a monograph published by the Independent Institute.[13]
Entitlement Reform Center
Thomas Saving (a former trustee of Social Security and Medicare) and Andrew Rettenmaier are two Texas A & M economists who have a long association with John Goodman. Together, the three economists devised a plan to reform Medicare with private accounts – a one-of-its-kind proposal to remove the long-term unfunded liability in the program.
More recently, Saving and Rettenmaier showed that 21-year-olds would be better off if they completely opted out of Social Security in return for paying a lifetime payroll tax of about 4.5% of their wages. Since the current payroll tax is 12.4%, that would leave young people with almost 8% of their wages to invest and save – more than enough to replace Social Security during their retirement years. Further, the remaining payroll tax would be enough to complete the nation’s obligations to those who remain in the system.[15]
The Saving-Rettenmaier proposal is an example of a win/win entitlement reform. Goodman expanded that idea in a presentation to the Mont Pelerin Society in September 2016 – arguing that there were literally thousands of win/win opportunities to reform federal policies. Further, Goodman proposed a trial-and-error method for discovering them.
The presentation was published by the Independent Institute as Better Than Government: A New Way of Managing Life's Risks.[1] The manuscript has since been expanded into a book that will be published by the Independent Institute in early 2020.
In 2018, the Goodman Institute published a Brief Analysis[2] showing that because of refundable benefits in the tax code it is impossible to be poor in America if you work full time – even if you earn the minimum wage and regardless of how many children you have.
Senior Citizen Issues
In an article in Forbes,[3] John Goodman argued that senior citizens are discriminated against by a number of public policies.
People on Social Security lose benefits if they earn even a modest amount of wage income. Medicare is paying doctors the way it did in the last century – long before the existence of email or iPhones. Seniors are the only people in our society who can’t have a Health Savings Account – from which to pay bills not covered by health insurance.
Seniors are also subject to double taxation of their savings (through the Social Security benefits tax) and the forced withdrawal of their tax-deferred savings. Millions of seniors lose out on Social Security and Medicare benefits they have worked and paid for because they can’t navigate the complexity of programs that are supposed to have been created for their benefit.
Women’s Issues
In a Brief Analysis,[4] Goodman Institute board member and former member of Congress Nan Hayworth says that the single most important economic and sociological change in our society in modern times has been the entry of women into the labor market. Today, three of every four women of working age are employed – more than double the share a half-century ago.
These changes have had a major impact on family life. Fewer than one out of every four households is "traditional,” with one wage-earner and a stay-at-home spouse. Dual-earner families — with both spouses in the labor market — now constitute about half of all married couples.
Yet Hayworth says our public policy institutions have not kept pace with these remarkable changes. Tax law, labor law and a host of other institutions are still designed from top-to-bottom on the assumption that husbands will be full-time workers, while wives will mainly stay at home. Almost every federal institution is in need of reform, she says.
References
1. The Better Way Tax Plan, Goodman Institute Brief Analysis 120, August 8, 2017
2. Hans Fehr, Sabine Jokisch, Ashwin Kambhampati, Laurence J. Kotlikoff, Simulating the Elimination of the U.S. Corporate Income Tax, NBER Working Paper No. 19757.
3. Hans Fehr, Sabine Jokisch, Ashwin Kambhampati, Laurence J. Kotlikoff, Simulating the Elimination of the U.S. Corporate Income Tax, NBER Working Paper No. 19757.
4. Alan Auerbach, Laurence Kotlikoff and Darryl Koehler, Assessing the Republicans’ “Better Way” Tax Reform, June 21, 2017.
5. Laurence Kotlikoff, On Tax Reform, Ryan Knows Better, Wall Street Journal, May 11, 2017.
6. We’ve Been Measuring Inequality Wrong – Here’s the Real Story. Goodman Institute Brief Analysis 101, March 14, 2016.
7. Seth G. Benzell, Laurence J. Kotlikoff, Guillermo LaGarda, Simulating Business Cash Flow Taxation: An Illustration Based on the "Better Way" Corporate Tax Reform, NBER Working Paper No. 23675, August, 2017.
8. A New and Better Way to Analyze Tax and spending Policies. Goodman Institute Brief Analysis 118, January 13, 2017.
9. John C. Goodman, “Applying the ‘Do No Harm’ Principle to Health Policy,” Journal of Legal Medicine, Vol 28, No 1, Jan-Mar, 2007.
10. Mark V. Pauly and John C. Goodman, Tax Credits for Health Insurance and Medical Savings Accounts, Health Affairs, spring, 1995.
11. John C. Goodman, “McCain is the Real Radical on Health Reform,” Wall Street Journal, July 30, 2008.
12. John C. Goodman, Six Problems with the ACA That Aren’t Going Away, Health Affairs Blog, June 25, 2015.
13. John C. Goodman, A Better Choice: Healthcare Solutions for America (Oakland, Ca: Independent Institute, 2015).
14. Pete Session, Bill Cassidy and John Goodman, How We Can Repeal the ACA and Still Insure the Uninsured, Health Affairs Blog, January 18, 2017.
15. Thomas R. Saving, Can Privatizing Social Security be a Win/Win for All Generations? Goodman Institute Brief Analysis 108, March 1, 2016.
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[1] John C. Goodman, Better Than Government: A New Way of Managing Life’s Risks, Independent Institute, October 6, 2016.
[2] Peter J. Ferrara, Reforming Welfare, Goodman Institute for Public Policy Research Brief Analysis 124, April 18, 2018.
[3] John C. Goodman, “Agenda for Seniors,” Forbes, April 16, 22019.
[4] Nan Hayworth, “Modern Families; Outdated Laws,” Goodman Institute for Public Policy Research Brief Analysis 125, May 23, 2018,
[1] David Altig, Alan Auerbach, Patrick Higgins, Darryl Koehler, Laurence Kotlikoff, Ellyn Terry, and Victor Ye, Did the 2017 Tax Reform Discriminate against Blue State Voters? Federal Reserve Bank of Atlanta Working Paper 2019-7, April 2019.
[2] Alan Auerbach, Laurence Kotlioff and Darryl Koehler, US Inequality and Fiscal Progressivity – An Intergenerational Accounting. June 5 2019.
[3] John C. Goodman, Donald Trump Takes a Big Step Toward Personal and Portable Health Insurance. Forbes, June 18, 2019.
[4] John C. Goodman, Portable Health Insurance: An Idea Whose Time Has Come. Forbes, February 22, 2016.
[5] Portable Health Insurance: An Idea Whose Time Has Come. Goodman Institute for Public Policy Research, Brief Analysis 105, April 6, 2016
[6] The World’s Greatest Health Plan, Goodman Institute for Public Policy Research.
[7] Pete Sessions, Bill Cassidy and John Goodman, How We Can Repeal the ACA and Insure the Uninsured at the Same Time. Health Affairs Blog, January 18, 2017.
[8] John C. Goodman, Characteristics of an Ideal Health Care System, National Center for Policy Analysis, NCPA Policy Report 242, April 2001.
[9] John C. Goodman, “Designing Ideal Health Insurance,” Psychology Today, September 24, 2012.
References[edit]
- ↑ Goodman, John C. "Donald Trump Takes A Big Step Toward Personal And Portable Health Insurance". Forbes. Retrieved 2019-06-24.
This article "Goodman Institute" is from Wikipedia. The list of its authors can be seen in its historical and/or the page Edithistory:Goodman Institute. Articles copied from Draft Namespace on Wikipedia could be seen on the Draft Namespace of Wikipedia and not main one.
