Econofact

The Issue: Recent proposals for a wealth tax at both the federal and state levels have been driven in part by concern about the rapid increase in U.S. income and wealth inequality and the apparent ease with which the wealthy are able to avoid income and estate taxes. Wealth taxes have also been seen as a convenient instrument for raising tax revenues and supporting under-funded social programs. However, these proposals have drawn criticism, including from those who argue that there are other, mo

The Issue: Artificial Intelligence systems can create a variety of technical, legal and financial risks for the people and companies that use, develop, and maintain them. Lawsuits involving AI raise complicated questions about who is responsible for these AI systems and who should pay for any resulting liability, as well as what role insurers should have in settling these costs. The Facts: AI has contributed to a wide range of real-world problems, from fines to law firms for citing in court no

The Issue: As the war in Iran continues, the costs and risks to the global economy are mounting. Central to these risks are constraints on the safe flow of oil by tankers through the narrow Strait of Hormuz. In good times, about one-fifth of world oil supply travels the Strait. Iran has allowed some ship-borne cargoes destined for China, India and a few other nations but the United States is now instituting its own blockade of these ships. At the war’s peak of disruption (so far), about 8 percen

The Issue: A decreasing proportion of younger people increases the share of elderly dependents relative to the working-age population, lowering the government’s tax revenues and raising spending obligations. The U.S. federal government debt has reached levels not seen since the aftermath of World War II, and is projected to continue rising over the next three decades on an unsustainable path. How have past fertility trends contributed to the government’s spending and revenue and high federal deb

The Issue: The June 24, 2022 Supreme Court Dobbs decision fundamentally changed the landscape for abortion access across the United States when it overturned Roe v. Wade and ended nearly fifty years of federal protections for abortion. Thirteen states enacted near complete abortion prohibitions in the immediate aftermath or shortly after the Dobbs ruling, while other states maintained or strengthened access to abortion. To the extent that people consider abortion policy as an important character

The Issue: Amid the spike in oil prices and the impact on international supply chains sparked by the Iran War, the Trump Administration announced a 60-day waiver of the Jones Act to “mitigate the short-term disruptions to the oil market” and “allow vital resources like oil, natural gas, fertilizer, and coal to flow freely to U.S. ports.” The Jones Act is a century-old law that prevents foreign-built, -owned or -operated vessels from shipping between ports in the United States, limiting competiti

The Issue: The rate of child poverty in the United States precipitously dropped in 2021 only to rise in more recent years. Federal tax credit policies — and especially the expansion of the federal Child Tax Credit (CTC) — were thought to have played a role in the reduction of child poverty at the time. What lessons did we learn from the 2021 expansion of the Child Tax Credit? Which provisions were the most effective in reducing child poverty, how much do they cost, and what are the tradeoffs? Th

The Issue: In spite of numerous reform efforts since the postwar period, general government tax revenue in the United States has remained largely unchanged as a share of GDP. Moreover,  there remains considerable dissatisfaction with U.S. taxes, which voters view as too high, unfair, and overly complex. This memo provides perspectives on these issues by comparing the U.S. tax system to other OECD countries. The Facts: Only about two thirds of total tax revenues in the United States are collect

The Issue: Many elderly people need long-term help with daily activities such as getting dressed, using the bathroom, eating, and getting in and out of bed, as well as with other instrumental activities such as cooking, taking medications, and grocery shopping. This eldercare can put a heavy time and psychological burden on close family and friends, while those with severe needs typically face a heavy financial burden to pay for care services, whether provided at home or in an institutional sett

The Issue: Brexit, the United Kingdom’s decision to withdraw from the European Union, is a rare contemporary example of a major developed economy raising trade barriers and more generally pulling back from international economic integration. New research aims to assess Brexit’s actual impact on the United Kingdom’s economy, which involves the challenging task of comparing the country’s economic indicators to what they would have been if the United Kingdom had remained in the European Union. This

The Issue: China finished 2025 with a world record trade surplus of $1.19 trillion. This surplus reflects China’s remarkable dominance as an exporter of manufactured goods. But it is also a result of weak spending by Chinese households, which limits China’s appetite for imports from the rest of the world and increases the Chinese economy’s dependence on foreign buyers for its domestic production. Shifting the economy to a more balanced pattern of growth will require a major redirection of policy

The Issue: Recent years have witnessed an extraordinary boom in Artificial Intelligence (AI) based on a widespread perception that AI is a truly transformative technology that will drive economic growth for many years. But there are also many skeptical voices that warn that this boom is greatly overdone, that the economic gains will be slow to come, and that AI is an inflating bubble that could burst with dangerous consequences for the U.S. economy. Previous cycles of dramatic investment in tech

The Issue: Policies that increase the returns to working, such as the minimum wage and the earned income tax credit, can increase household economic security among the working poor, potentially reducing child food insecurity. New research is finding evidence that links these policies to reduced food insecurity among households with children and provides additional policy options at the state level for reducing childhood food insecurity. The Facts: Household food insecurity has been linked to a

The Issue: Tariffs on imported goods have risen steeply since President Trump’s second inauguration, to the highest level since 1935. New research and constantly updated data of online pricing trends at five major U.S. retailers provides a window into how goods prices are changing in real time. The emerging evidence from this data shows that goods prices have indeed been increasing in response to tariffs, although the magnitude of price increases to date remains modest relative to the announced

The Issue: Children need food to grow and show up to school ready to learn. Yet in 2023 — the latest data available — almost one in six children in the United States lived in households that experienced food insecurity. A patchwork of public and non-profit programs provides nutrition assistance to a large number of children and helps buffer them from food insecurity. The programs play a vital role in reducing the most severe forms of food insecurity and hunger for children in the United States a

The Issue: College sports is undergoing an era of rapid and profound transformation with a number of major changes taking place concurrently. These changes threaten to drive an even bigger wedge than what currently exists between the educational mission of colleges and universities and their promotion of sport teams that garner attention and donations but do little to help the greater academic mission. The Facts: A settlement agreement approved in U.S. District Court in June of 2025 allows col