Copyright (c) 2009 All rights reserved. http://works.bepress.com/jason_bordoff Recent documents in Jason Bordoff en-us Sun, 20 Sep 2009 23:30:22 PDT 3600 http://works.bepress.com/jason_bordoff/25 http://works.bepress.com/jason_bordoff/25 Sat, 19 Sep 2009 15:21:58 PDT Jason Bordoff Globalization Energy and Environment http://works.bepress.com/jason_bordoff/24 http://works.bepress.com/jason_bordoff/24 Sat, 21 Feb 2009 11:58:07 PST In these tough economic times, consumers are looking everywhere for places to pinch pennies.To save on gasoline, for example, drivers reduced miles traveled by 4 percent in 2008 compared to a year earlier. But drivers could have saved even more: they still had to pay the same amount for auto insurance, even though the likelihood of being involved in an accident decreased as they drove fewer miles. A bill just introduced in the Washington State Senate would fix that disparity by encouraging firms to price auto insurance based on miles driven rather than in a lump sum amount per year. The idea is called "pay-as-you-drive" auto insurance. Jason Bordoff Energy and Environment Insurance http://works.bepress.com/jason_bordoff/23 http://works.bepress.com/jason_bordoff/23 Sat, 21 Feb 2009 11:52:51 PST The United States is in the midst of the most serious economic downturn since the Great Depression. Policymakers are understandably preoccupied with applying the right mix of fiscal and monetary policy responses to stanch and eventually reverse the decline. At the same time, policymakers need to build a foundation for sustainable, long-term prosperity that can drive our economy once we move beyond the present crisis. Going forward, the economy will no longer have the technology boom of the 1990s or the housing bubble of the 2000s to sustain its growth. And it is unlikely that debt-driven consumer spending or Wall Street will provide the same boost as in the past. If we are going to provide opportunities for all Americans going forward, we need to make the right investments today to rebuild American competitiveness by investing in our people, infrastructure, ideas, and green transformation.This paper addresses this central challenge for the United States. We begin by discussing the economic downturn and financial turmoil facing the country and how policymakers should respond to both boost our economy in the short-run and also build the foundations for long-term competitiveness. Second, the competitiveness agenda is motivated by, and must therefore be responsive to, at least three changes in the fabric of the global economy: the increase in global integration; the attendant shift in economic power to rising powers such as Brazil, China and India; and the realization of the existential threat that climate change poses. Finally, we lay out the fundamentals of a competitiveness agenda through descriptions of specific policy proposals by leading experts on how to invest more robustly in infrastructure, people, ideas and green transformation. Jason Bordoff Globalization http://works.bepress.com/jason_bordoff/22 http://works.bepress.com/jason_bordoff/22 Wed, 14 Jan 2009 09:46:57 PST While oil prices have decreased they won't remain that way due to demand and tight supplies. Jason Bordoff argues that faced with this reality, policymakers need to take measures now, while prices are low, to encourage both conservation and development of alternative energy sources. Jason Bordoff Energy and Environment http://works.bepress.com/jason_bordoff/21 http://works.bepress.com/jason_bordoff/21 Wed, 14 Jan 2009 09:43:27 PST The incoming administration needs to act quickly to stimulate our ailing economy. Jason Bordoff suggests that one way to stimulate the economy and prevent the collapse of the auto industry, tackle climate change and promote oil independence, is to offer "cash for clunkers"--drivers would be given vouchers toward the purchase of newer, more fuel-efficient vehicles, with the old vehicles scrapped to get them off the road. Jason Bordoff Energy and Environment http://works.bepress.com/jason_bordoff/20 http://works.bepress.com/jason_bordoff/20 Tue, 04 Nov 2008 18:58:33 PST Any unilateral effort by the United States to reduce greenhouse gas emissions by putting a price on carbon raises concerns that it may harm the "competitiveness" of U.S. firms or undermine the measure's environmental objective by causing carbon "leakage." One oft-proposed response is to level the carbon playing field by imposing a border adjustment on carbon-intensive imports from countries without comparably effective climate policies. This paper explores the economic and legal implications of border adjustments and argues that their potential harms outweigh whatever small benefits they might provide. As a less harmful alternative, this paper argues for compensating adversely affected firms through the free allocation of allowances based on an ex post showing of harm and assisting workers displaced by a carbon price through such policies as wage insurance, retraining, and job search assistance. Jason Bordoff Globalization Energy and Environment http://works.bepress.com/jason_bordoff/19 http://works.bepress.com/jason_bordoff/19 Wed, 13 Aug 2008 08:12:35 PDT Jason Bordoff Energy and Environment Insurance http://works.bepress.com/jason_bordoff/18 http://works.bepress.com/jason_bordoff/18 Wed, 13 Aug 2008 08:10:20 PDT The current lump-sum pricing of auto insurance is inefficient and inequitable. Drivers who are similar in other respects--age, gender, location, driving safety record--pay nearly the same premiums if they drive five thousand or fifty thousand miles a year. Just as an all-you-can-eat restaurant encourages more eat­ing, all-you-can-drive insurance pricing encourages more driving. That means more accidents, congestion, carbon emissions, local pollution, and dependence on oil. This pricing system is inequitable because low-mileage drivers subsidize insurance costs for high-mileage drivers, and low-income people drive fewer miles on average.A better approach is simple and obvious: pay-as-you-drive (PAYD) auto insurance. With PAYD, insurance premiums would be priced per mile driven. All other risk factors will still be taken into account, so a high-risk driver would pay a greater per-mile premium than a low-risk driver. With insurance costs that vary with miles driven, people would be able to save money by reducing their driving, and this incentive would lead to fewer driving-related harms. PAYD would also be more equitable because it would eliminate the cross-subsidization of insurance costs from low-mileage to high-mileage drivers. Given these potential benefits, there has been increased interest in California recently in encouraging PAYD insurance. This paper is intended to help policymakers and the general public understand and evaluate the potential impact of PAYD in California. It is based on a recently-released study of PAYD in the United States, "Pay-As-You-Drive Auto Insurance: A Simple Way to Reduce Driving Related Harms and Increase Equity," published by the Hamilton Project at the Brookings Institution. In California, we find that:PAYD would result in an 8 percent driving reduction from light-duty vehicles. Estimated gross annual social benefits from an 8 percent driving reduction total $10.8 billion based on current driving levels, and $21.1 billion based on 2020 projections. The California state government would save $54 million annually based on 2006 data and $60 million annually based on 2020 projections. PAYD would generate 7 to 9 percent of the total CO2 reductions needed to meet California's emissions targets for 2020. Nearly two-thirds (64 percent) of households in California would have lower premiums under PAYD. The average savings for that group would be $276 per vehicle per year (in 2007 dollars). Low-income drivers would benefit especially. Every household income group making less than $47,500 (in 2001) saves on average. Even in higher income groups, a majority of households are better off. For every ethnicity, a majority of California households would save money with PAYD, contrary to the claims of some groups that PAYD would disproportionately impact certain ethnic groups. Because geography is a key risk-factor, a roughly equal proportion of rural (62.4 percent) and urban (64.2 percent) California households save money with PAYD.In short, PAYD represents a win-win policy. What is good for drivers, in this case, is also good for society. Jason Bordoff Energy and Environment Insurance http://works.bepress.com/jason_bordoff/17 http://works.bepress.com/jason_bordoff/17 Wed, 13 Aug 2008 07:59:49 PDT Part I of this Essay reviews the traditional case for progressivity in the tax code, putting it in the context of the recent trend toward increasing income inequality. This Part also rejects the view that modestly more progressive rates will seriously harm economic performance by blunting incentives to work, save, and invest. Part II suggests a broader motivation that goes beyond concerns about inequality per se, instead appealing to the widely accepted notion that economic policies should be favored when they make everyone better off. A combination of progressive tax reform and proglobalization policies can move us closer to this ideal. This is not just a theoretical argument. Evidence shows that globalization policies like free trade lead to stronger economic growth and higher standards of living, but there are worrisome signs of an increasing protectionist backlash. We argue that this backlash stems in part from real economic dislocations caused by trade, but far more from the government's failure to ensure that the fruits of strong economic growth are broadly shared. Falling or stagnant incomes, likely due largely to factors other than trade, have led to this protectionist drift. A disproportionate share of blame is attributed to trade in part because of its highly visible manifestations. A firm's decision to outsource jobs to China or India is easier to see than the rising returns to skill from technological change, which most economists agree is a key cause of wage stagnation and rising inequality.14 Those who seek enhanced economic security for American families and those who seek greater globalization should come together in support of progressive tax policy to achieve more broadly shared prosperity. Part III compares the relative merits of alternative proposals to secure more broad-based economic growth and explains why progressive income tax reform is a more promising approach. Part IV then offers a set of specific recommendations to effect progressive income tax reform. Part V concludes. Jason Bordoff Economic Security Globalization Tax Policy http://works.bepress.com/jason_bordoff/16 http://works.bepress.com/jason_bordoff/16 Wed, 11 Jun 2008 13:01:43 PDT Any unilateral effort by the United States to reduce greenhouse gas emissions by putting a price on carbon, such as a cap-and-trade system, raises concerns that it may harm the "competitiveness" of U.S. firms or undermine the measure's environmental objective by causing carbon "leakage." One oft-proposed response is to level the carbon playing field by imposing a border adjustment, such as a requirement to purchase emission allowances, on carbon-intensive imports from countries without a comparably effective climate policy. This paper weighs the expected benefits of border adjustments against their potential harms. It notes that a border adjustment on carbon-intensive imports from certain countries, such as that proposed in the Lieberman-Warner Climate Security Act, would do little to reduce the small amount of carbon leakage, though it would protect a few specific carbon-intensive domestic industries. At the same time, there is a risk that border adjustments would be abused for purely protectionist reasons, lead to retaliatory tit-for-tat trade wars, or be ruled WTO noncompliant. The paper focuses on this last concern about the consistency of border measures with international trade law and particularly on how that analysis should be informed by the economics of a cap-and-trade system. While the outcome of any complex legal question is difficult to predict, the paper identifies several ways in which a border adjustment on carbon-intensive imports from countries without comparably effective climate policies may be inconsistent with WTO law. As an alternative, some have proposed the use of free allocation of allowances to compensate adversely affected industries. The paper finds such measures, depending on how they are designed, may be more likely to be WTO compliant, though only to the extent that they are mostly ineffective in protecting employment and output in adversely affected industries. The paper concludes that the expected costs from both border adjustments and free allocation likely outweigh the benefits, and suggests alternative mechanisms to address climate change while mitigating leakage and adverse impacts on workers in carbon-intensive sectors. Jason Bordoff Energy and Environment