A few facts to know about Social Security

Even though Social Security is about one-fifth of the U.S. budget, it does not add to deficits because of the way it is funded.

Hear IPP’s David Osterberg discuss Social Security on “The Devine Intervention” radio show with Michael Devine, 1400-AM KVFD Fort Dodge.

There is much misunderstanding routinely presented about Social Security and its impact on federal deficits. Some portray it as a problem; in fact, Social Security not only does not add to deficits, but supports millions of Americans and, thus, the economy. Consider these points from the Center on Budget and Policy Priorities (CBPP) and the Economic Policy Institute (EPI):

Social Security keeps 21 million Americans out of poverty

Social Security benefits play a vital role in reducing poverty. Without Social Security, 21.4 million more Americans would be poor, according to the latest available Census data (for 2011). Although most of those whom Social Security keeps out of poverty are elderly, nearly a third are under age 65, including 1.1 million children.
157,000 fewer elderly poor (Figure 1)
—Without Social Security, 47.3 percent of elderly would be in poverty; with it, only 5.6 percent (Table 2)
Beneficiaries: 592,000 in Iowa, including 435,929 age 65 and older, 130,205 ages 18-64, and 25,866 under age 18. (Table 3)

Social Security is a fifth of the U.S. budget …

Social Security: Another 20 percent of the budget, or $731 billion, paid for Social Security, which provided retirement benefits averaging $1,229 per month to 35.6 million retired workers in December 2011. Social Security also provided benefits to 2.9 million spouses and children of retired workers, 6.3 million surviving children and spouses of deceased workers, and 10.6 million disabled workers and their eligible dependents in December 2011.

… but it is not driving the deficit …

Social Security can only spend what it receives in tax revenues and has accumulated in its trust fund from past surpluses and interest earnings. It cannot add to the deficit if the trust fund is exhausted because the law prohibits it from borrowing (if current revenues and savings in the trust fund are not sufficient to pay promised benefits, these have to be cut). Though modest changes will be needed to put Social Security in balance over the 75-year planning period, the projected shortfall is less than 1% of gross domestic product (GDP). …

… and it helps to finance the debt.

Money that the federal government borrows from the public or from Social Security is used to finance the ongoing operations of the government in the same way that money deposited in a bank is used to finance spending by consumers and businesses. In neither case does this represent a “raid” or misuse of the funds. The bank depositor will get his or her money back when needed, and so will the Social Security trust funds.
Thank you to CBPP and EPI for offering important resources to the public on these issues. See links above.

Posted by Mike Owen, Assistant Director

IPP to EPA: Hold DNR Accountable on Water Quality

There is no question that if EPA simply accepts the agency’s agreement to try to do better, water quality will not improve in this state.

Tonight (October 18) in Des Moines, Environmental Protection Agency Region 7 Administrator Karl Brooks will meet with Iowans to hear comments and concerns about a new work plan by the state Department of Environmental Resources to bring Iowa into compliance with the Clean Water Act.

Below is a letter outlining remarks prepared by IPP Executive Director David Osterberg for tonight’s meeting.

The meeting is at the State Historical Building, 600 East Locust Street, Des Moines, from 7 p.m. to 9 p.m.


Oct. 17, 2012

Stephen Pollard, Water Enforcement Branch
United States Environmental Protection Agency, Region 7
11201 Renner Blvd
Lenexa, KS 66219

RE: Public comments on Iowa DNR’s response to EPA’s Water Quality findings

Dear Mr. Pollard:

The Iowa Policy Project is a nonprofit research organization located in Iowa City. We wish to make the following comments about the response by the Iowa Department of Natural Resources to your report of inadequacies in the state NPDES program. We limit our remarks to the question of staffing and funding the agency.

  1. The DNR acknowledged that it has given less attention to water quality problems caused by animal feeding operations — see quote below:

“Since 2007, the DNR has had a significant reduction in its animal feeding operations staff. To better meet our responsibilities, the DNR needs both an increase in staffing and to reprioritize workloads.”

While the DNR did not explain to you the extent of the deep reduction in agency field staff they have answered elsewhere.

From a DNR 2011 report on manure on frozen and snow covered ground:

“The scope and complexity of confinement program work increased disproportionately beginning with legislation in the late ’90s. With this, public awareness of environmental issues also grew, resulting in a significant increase in local demand for education, compliance assistance and compliance assurance. To address these needs, animal feeding operations field staffing gradually increased to a high of 23 by SFY 2004. In SFY 2008, four staff people were shifted into a newly established open feedlots program. Then in the fall of 2009, as General Fund expenditures declined, confinement staffing was reduced again. This reduced staff numbers from 19 to 11.5. Further reductions leave the total of field staff for confinement work at 8.75 full time equivalents. This reduction means that the DNR will not be able to maintain an adequate level of compliance and enforcement activity in confinements.”

Thus the 2011 DNR report demonstrates that the envisioned 13 staff-person increase would only bring numbers back to approximately the 2004 staffing levels — before the addition of many more confinement operations.

  1. Underfunding of water quality programs is not limited to animal agriculture. An IPP report from March 2012 demonstrated an overall decrease in water quality funding of $5 million over the decade. Drops in the Bucket: The Erosion of Iowa Water Quality Funding found that this water-quality funding decline came despite greater needs for water protection and public willingness to fund it.
  1. Given this underfunding by the Iowa Legislature, there appears to be no basis for the agency’s belief that it will get approval for 13 more staff members. First, the request must be made in the Governor’s proposed budget that will be drawn up in January of next year. Second, the Legislature must agree to this increase without endangering other water quality programs.
  1. EPA should help the agency in bargaining with a legislature that has shown itself to be less concerned with water quality protection than tax cuts. EPA should tell the DNR that if it fails to get a proposed increase in staff in the Governor’s budget and also to have the request authorized by the General Assembly, there will be consequences. These must be severe consequences commensurate with the funding being sought — that is, EPA should establish a minimum number of staff additions that will be required. Absent that it should state that it will withdraw the authorized NPDES program from DNR. There is no question that if EPA simply accepts the agency’s agreement to try to do better, water quality will not improve in this state.

Thank you for your attention to improving the quality of water in our state.


David Osterberg, Executive Director, The Iowa Policy Project

Policy and pollution: We have options

“It’s not like we don’t have options. We do. Public policy can make a difference in protecting the environment.”

Iowa’s deteriorating water quality is a lingering problem that never seems to make it to the front burner of political campaigns or elected leaders’ agendas in the State Capitol. The Des Moines Register’s editorial today asks — and answers — the fundamental questions:

Why is our water so dirty? The state’s agricultural businesses, including 7,000 animal feeding operations, is a significant reason. Why do they do so much damage to the environment? Elected officials let them.

David Osterberg
David Osterberg

It’s not like we don’t have options. We do. Public policy can make a difference in protecting the environment, through tough and effective regulations that recognize the air and water belong to all of us, and by helping folks do a better job with targeted incentives.

Unfortunately, as the Register suggests, elected officials in Iowa have passed up opportunities in both the regulatory and incentive arenas to enhance Iowa’s water quality. The Iowa Policy Project through the years has noted many of the issues and presented constructive policy options. Here is a selection of those reports:

IPP also showed this year how environmental protection funding has waned in Iowa — even when voters specifically told lawmakers with a referendum in 2010 that environmental protection is an area where they want to see funding directed. As we found:

While legislators and other elected officials will always proclaim their commitment to clean water, they have not over the past decade demonstrated that commitment through the state budget. In fact, once inflation is taken into account, funding for many programs the state relies upon to monitor, protect and improve waterways has dropped by 25 percent or more. …

Over time, this slow erosion in the purchasing power of these programs is likely to contribute to deteriorating Iowa water quality, if it has not already done so. When funding is scaled to FY13 appropriations, the slow decline in spending on water programs becomes more evident.

Posted by David Osterberg, Executive Director

Tax-cutters’ unbalanced focus undermines self-government

What we have in Des Moines is a leadership problem and a governing problem.

David Osterberg
David Osterberg

Cut taxes, starve schools. Cut taxes, starve environmental protection. Cut taxes, … well, I think you’re getting the idea.

“The-tax-cuts-are-my-only-priority” legislators now have enough power to keep eroding our ability to meet our needs.

As I pointed out Sunday in a guest opinion in The Gazette in Cedar Rapids, this drive to underfund education is the root of recent decisions to close Polk Elementary School in Cedar Rapids and the Price Lab School at the University of Northern Iowa.

What we have in Des Moines is a leadership problem and a governing problem. Leaders find a way of matching revenues to our needs. The rejection of this kind of responsibility by a large enough number of our elected officials is the problem.

And the facts — as we have demonstrated in Iowa Policy Project reports — are clear. Most recently, we showed Iowa’s decline in support for the regents’ universities over the last 10 years. For the University of Iowa alone, it meant 40 percent less in actual spending power than the state provided in 2000, and a shift of costs to tuition-paying students and their parents.

A week before, we showed similar results with water-quality funding.

Even now, there is no greater cry than to cut commercial property taxes — even when most of the cuts would go to firms like WalMart and McDonald’s. It doesn’t matter. It’s a tax cut, period.

Ironically, even those who some elected officials are attempting to appeal to need the services they are cutting. Rockwell Collins needs trained engineers, and can better retain employees when rivers are clean and people have places to recreate.

Voters who want their kids educated and their rivers clean need to recognize that it doesn’t happen without state funding. More tax cuts don’t get us there.

Posted by David Osterberg, Executive Director

Iowa JobWatch: Jobless Rate Dips — Payroll Jobs Improve

The state still remains almost 41,000 jobs behind where it was at the start of the last recession in December 2007. Still, things are looking better.

David Osterberg
David Osterberg

Unemployment Rate 5.4 Percent in January; Job Growth Still Slow in State

IOWA CITY, Iowa (March 13, 2012) — Analysts at the nonpartisan Iowa Policy Project noted the unemployment rate dipped to 5.4 percent in January, down from 5.6 percent in December, as payroll jobs also improved by 3,700. IPP, which tracks employment trends in Iowa, released this statement from Executive Director David Osterberg:

Employment over the last year in Iowa is showing good signs, though growth remains very slow. Payroll data showed a net gain of over 9,000 jobs during the year, with about 40 percent of those jobs added in January.

Especially good news was the fact that the state gained nearly 12,000 manufacturing jobs from January 2011 to January 2012. These jobs generally are higher paid and often have benefits. However, the state also lost 4,000 government jobs and 3,200 professional and business services jobs, also generally better paid than jobs in some sectors.

Now that the economy seems to be picking up with the unemployment rate dropping to 5.4 percent, it is time to question the quality of the jobs we are getting back. And it is time to stop shedding jobs in the public sector. That is one area that the governor and legislature have some control over.

The state still remains almost 41,000 jobs behind where it was at the start of the last recession in December 2007. Still, things are looking better.

Key Numbers

— Nonfarm jobs were up in January by 3,700, to 1,484,300, from the revised December estimate.
— Nonfarm jobs are 43,900 behind the May 2008 peak of 1,528,200, and 40,900 behind the level at the start of the last recession in December 2007.                           
— The unemployment rate was 5.4 percent in January, down from 5.6 percent in December and down from 6.1 percent a year earlier.
— The labor force, those working or looking for work, was virtually unchanged (up 100), but slightly down (1,900) over the year.
— Initial unemployment claims were down — by 37 percent, to 19,846 — for the month, and down 6.3 percent over the year.                                    

Key Trends

— Iowa averaged a monthly increase of only 800 jobs, in the last 12 months.
— Nonfarm jobs are above year-ago level for the 16th month in row.
— Manufacturing is the top-gaining job sector over the past 12 months, up 11,800, followed by construction at 3,100 and trade, transportation and utilities at 2,900. Manufacturing led gains for the month at 3,500, with leisure and hospitality up 3,200 and “other” services up 1,600.
— Government jobs declined by 4,000 over the year, and professional and business services fell by 3,200. For the month, education and health services led declines at 2,500, and professional and business services dropped 1,200.

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Will Iowa ever put taxpayers’ dollars where their voices are?

The only thing that is self-evident is that Iowa lawmakers are not putting taxpayers’ money where their voices are: toward more and better water-quality initiatives.

Mike Owen
Mike Owen

The Des Moines Register editorial staff has produced some excellent perspectives about budgets in recent days, about budget cutting run amok, and budget cuts affecting the courts and human services (including accountability and oversight). Noted The Register:

It’s unlikely you will hear a politician say state government is too small. But at some point, it is.

You could certainly make the same case about environmental quality programs, particularly in water quality, as we showed in a report last week. In Drops in the Bucket: The Erosion of Iowa Water Quality Funding, IPP’s Will Hoyer, Brian McDonough and David Osterberg noted:

In a state with almost 90 percent of its land worked for agriculture, it should be of stark concern to Iowa policy makers that the water running through both our agricultural lands and urban landscapes contains excess nutrients, toxic chemicals, and sediments. These pollutants end up in Iowa’s rivers and streams. The impacts upon public health, fishing and other recreational activities, and cleanup and water treatment costs show up not just in Iowa, but all the way to the Gulf of Mexico. There, the nutrients from cornbelt farm fields are creating the area of hypoxic (low oxygen) conditions known as the “Dead Zone,” where sea life cannot live. …
Iowa voters demonstrated strongly that they favor additional efforts to protect Iowa waterways when 63 percent voted in 2010 to approve the Water and Land Legacy amendment, so one might expect the state to increase its commitment to protecting its water. While funding by itself is not an indicator of performance, it is a necessary ingredient in the fight to protect and improve Iowa’s water resources. This report looks at funding for several key state water programs over the last decade and finds that, from a fiscal perspective, the state’s commitment to water protection programs is woefully lacking. (emphasis added)

Among the IPP analysts’ findings is that for most of the period from FY2002-12, inflation-adjusted totals for 10 critical water programs hovered at just over $20 million, and that there were significant drops from those funding levels in FY03 and FY11, with little rebound from the latter in FY12. See the figure below (Figure 3 in our report).

Recent Drop in Water Quality Funding in Critical Programs
Figures in thousands

At the same time of these funding trends, we have learned that more and more waters in Iowa were impaired. One might expect greater awareness to produce greater attention to remediation, but clearly we are not seeing it. In fact, the Legislature would have to restore $5 million in state water-quality funding just to move to what it had been during the previous decade — as if those earlier levels were enough, something that is not self-evident.

The only thing that is self-evident is that Iowa lawmakers are not putting taxpayers’ money where their voices are: toward more and better water-quality initiatives.

Posted by Mike Owen, Assistant Director

Drops in the bucket: an erosion of water quality funding

At what point do we say, “Enough is enough,” and start making the investment in our natural resources?

Will Hoyer
Will Hoyer

Lawmakers in Des Moines working on the state budget should remember that 63 percent of Iowans approved of a constitutional amendment creating a new fund for natural resources and water quality in the state.  And now there is new evidence that that funding is needed.

In our March 1st report, Drops in the Bucket: The Erosion of Iowa Water Quality Funding, we show that overall water quality funding in the state has dwindled over the past decade and it would take at least $5 million in next year’s budget just to get us back to an average funding level for the past decade.  This begs the question of whether those average levels were adequate or not.

The 10 water quality programs we looked at most saw significant declines of around 30 percent when adjusted for inflation.  These programs provide a good snapshot of overall water quality funding in the state.

Table 3 from IPP report
When adjusted for inflation most of these programs saw significant decreases; the average inflation-adjusted decrease for these seven budget items is over 30 percent.

Numbers can sometimes be deceiving and in some cases look better than they really are.  The water monitoring program of the DNR, for instance, has maintained nominal funding of about $2.9 million for nine straight years. Because of shifting money within the department, however, the monitoring program is not able to monitor things like groundwater quality, or test for pesticides and pharmaceuticals like it used to.

Money is not the only factor in improving Iowa water quality, but it is a necessary part of any effort.  Iowa’s water quality can be improved.  For evidence, just look at trout streams in northeast Iowa, which have made dramatic improvements since the mid-1980s, with six or seven times more streams having naturally reproducing trout now.

Improvements like that won’t  happen without funding and the state’s current investment in water quality is not going to be adequate to make a significant improvement across the state. If these trends continue where will be in another 10 years?  At what point do we say, “Enough is enough,” and start making the investment in our natural resources?

Posted by Will Hoyer, Research Associate


Read new IPP report by Will Hoyer, Brian McDonough and David Osterberg

See Radio Iowa and Cedar Rapids Gazette stories about the report