QUOTE OF THE DAY
Chicago Tribune: Lawmakers push to spend $900 million
State lawmakers are looking at spending more than $900 million to build roads, protect patients from bad doctors and investigate child abuse under legislation that started making its way through the General Assembly on Monday.
The state's financial situation remains poor, but the additional spending is viewed as a way to tweak the budget approved last May. A few million dollars would come from higher fees on doctors to cover the costs of the agency that disciplines wayward physicians, a program just recently beefed up following years of lax oversight. Another $53 million would cover the costs of child welfare programs and other state agency operations from money freed up largely because Gov. Pat Quinn closed some prisons and other state sites.
The bulk of the money — $713 million in road construction and capital projects — is available from a series of sources, including new infusions from the federal government and better-than-expected tax revenue going into the state's road fund.
The legislation cleared the House Executive Committee as part of a package Quinn and lawmakers want to approve quickly. A separate bill would officially schedule the governor's budget address on March 6, two weeks later than the time set by law.
The plan to raise the amount doctors pay to fund state oversight and discipline in their profession would increase fees charged every three years from $300 to $750 under legislation sponsored by House Majority Leader Barbara Flynn Currie, D-Chicago.
State funds to pay for routine matters of licensing, as well as the broader oversight and discipline of doctors, have run dry, causing the staff to drop from 26 to eight and creating a huge backlog of cases that Currie said is "continuing to grow." The last time the fee was raised was 1987, she said.
Reuters: Ohio Governor Kasich backs Medicaid expansion in proposed budget
Ohio's Republican governor on Monday endorsed the expansion of Medicaid under President Barack Obama's healthcare reform law, raising expectations that political opposition to the plan may be starting to thaw among GOP leaders in so-called Red states.
Gov. John Kasich, the fifth Republican state governor to support the Medicaid expansion, made his announcement as part of a press briefing on his $63.3 billion 2014-15 budget proposal. He emphasized that he is not a supporter of "Obamacare," but believes the Medicaid plan "makes sense for the state of Ohio."
"Ohio taxpayer dollars are coming back to Ohio to support a significant need we have," Kasich said. The state's Medicaid program for the poor would be extended to about 366,000 uninsured Ohioans.
But Kasich also said that state officials stood ready to repeal the expansion if the federal government were to alter the reimbursement plan.
Atlantic Cities: How Virtual Traffic Lights Could Cut Down on Congestion
Every new glimpse at the future of urban transport seems to be missing something pretty big. A car without, you know, human drivers. A trains of cars commuting on the highway with human drivers who aren't, you know, actually driving. The next peek ahead, according to computer scientist Ozan Tonguz of Carnegie Mellon University, gets rid of all the traffic lights.
At least the physical ones. Tonguz and colleagues are designing a road-efficiency system, based on emerging-vehicle-to-vehicle technology, called Virtual Traffic Lights. The idea is to shift traffic control from fixed street signals to the moving cars themselves. The result, says Tonguz, is an optimized traffic flow that should greatly reduce city congestion.
"To do this means that we can improve the life quality of New Yorkers, people in L.A., Boston, Atlanta, and other major cities tremendously," he says. "If you really want to take major stride in solving traffic congestion problems, for the life of me I don't know how else traffic congestion can be mitigated."
The basic world of Virtual Traffic Lights operates like this: as you approach an intersection, your car transmits data, such as location and speed, to other nearby cars. The virtual system processes this information for all the cars in the area, with the help of a lead car that changes every cycle, and determines your individual traffic signal. Instead of seeing a red or green light hanging in the intersection, you see it on your windshield and stop or go accordingly.
The first advantage to Virtual Traffic Lights is that every intersection with a car now automatically has a traffic light. That may not seem like much, but fewer intersections are equipped with signals than many people realize. In New York City, for instance, only about 24 percent of intersections have a four-way signal. As traffic lights become ubiquitous, road safety should dramatically improve.
The second benefit is a much better traffic flow. The algorithm that governs the virtual system can be written for total efficiency. If the system recognizes that no cars are coming from another direction, it can extend a green signal indefinitely. Likewise, at heavy intersections, it can give preference to the longest line of cars. Using similar technology to Google's driverless car, the system can also recognize the presence of pedestrians and bicyclists, and orchestrate traffic to suit their needs.
Pensions & Investments: DC plans snag a bigger piece of the Top 1000
For the first time, defined contribution plan assets make up more than 30% of the nation's 1,000 largest retirement funds' coffers and more than a quarter of the top 200 plans' assets, according to Pensions & Investments' annual survey.
Overall, total holdings of the top 1,000 retirement plans rose 12.3% for the year ended Sept. 30, to $7.534 trillion. The top 200 plans' combined assets jumped 12.1% to $5.566 trillion.
There were no double-digit gains a year earlier: for the year ended Sept. 30, 2011, the top 1,000 grew 2.3% and the top 200, 1.7%. Employer contributions to the top 200 DB plans were up 3.9%, to $98.2 billion, and benefits paid rose 2.1% to $215 billion.
For the most recent survey, 30.4% of all assets in the top 1,000 plans and 25.4% of the top 200 were in defined contribution plans. The percentage growth in defined benefit assets among plans in the top 1,000, at 11.3% to $5.242 trillion, was almost four percentage points below that of DC plans, which rose 14.7% to $2.292 trillion.
Similarly, the percentage increase in DC assets among the top 200 plans, up 14.4% to $1.415 trillion, was higher than the 11.3% boost in top 200 DB assets, to $4.152 trillion.
While no one is predicting DC assets will overtake DB assets anytime soon, the growth in DC — both in total and as a percentage of total U.S. retirement fund assets — has been a consistent long-term trend. According to P&I survey data, total DC assets for the top 1,000 funds have grown 276% in the 20 years ended Sept. 30, and 230% for the top 200, compared with 159% for DB plans in the top 1000 and 163% for the top 200.
CNBC: Housing Market Already Shows Signs of a New Bubble
When housing began to simmer back in 2002, prices were rising around seven percent a year, then eight percent in 2004 and a stunning 12 percent in 2005.
At the time, words like "bubble," and "unsustainable," were uttered with every monthly reading. No one had seen home prices soar like that since the mid 1970's.
Historically, prices nationally rise about three to four percent a year. The market was clearly too hot, and by 2007 it had reversed dramatically, with prices falling nationally for the first time in history.
Fast forward to today and the housing recovery.
Barely a year in, home prices rose over eight percent annually in December, according to a new report from CoreLogic. While still down double digits from their 2006 peak, prices are suddenly soaring again and raising some serious red flags.
CNN Money: Texas to California businesses: Move here!
Texas Governor Rick Perry has three words of advice for California businesses: Move to Texas.
Perry has launched a high-profile battle for California companies, running radio ads in California touting the Lone Star State's low taxes and favorable business climate. The ads will be heard in San Francisco, Sacramento, Los Angeles, San Diego and the Inland Empire area east of Los Angeles.
"Building a business is tough, but I hear building a business in California is next to impossible. This is Texas Gov. Rick Perry, and I have a message for California businesses: Come check out Texas," starts the 30-second spot.
Perry notes that his state has won the Best State for Business title from Chief Executive magazine for eight years running. He noted that the cost of doing business in California is 6.3% above the national average and Texas' is 4.6% below it.
This is not the first time Texas has looked to raid California for businesses. The governor has made several scouting trips and has written letters to California companies in the past. And, according to the governor's office, nearly three dozen California companies have relocated or expanded in Texas during California Gov. Jerry Brown's term.
Texas isn't the only one knocking on California companies' doors. Several states have courted Golden State businesses in recent years, particularly during California's budget turmoil.
California officials, however, aren't that concerned. Business relocations account for only .03% of annual job losses and the state is doing well economically, according to the Governor's Office of Business and Economic Development.
Watchdog: Bill would halt taxpayer-funded union activism
Try asking your boss if you can help organize a political protest and shout down opposing viewpoints during company time and at company expense. If you’re like most Americans, chances are good that’d be the second-to-the-last conversation you’d have with a company official — right before the one that leads to cleaning out your desk.
But unionized government workers are not like most Americans.
That’s why Brigitte Nieland, vice president of the Education and Workforce Development Council for the Louisiana Association of Business and Industry, is keen on congressional legislation introduced in early January that would put an end to “official time” – a controversial practice that allows federal employees to conduct union business during working hours unrelated to their work responsibilities.
Critics charge that official time amounts to a substantial government subsidy for union activity, paid for by taxpayers—at a time when the federal government continues to run up massive deficits. Official time was first codified into law under President Jimmy Carter in 1978. House Republicans are gathering support for legislation that would prohibit federal employees from conducting union business when they are working on taxpayer time.
CNBC: Did 2013 Tax Hikes Slow Charitable Giving in 2012?
Last year, many of the wealthy said they would give less to charity if taxes went up.
Turns out, they weren't kidding.
According to data from Blackbaud, which tracks monthly numbers for more than 3,100 non-profits, total giving in the United States grew by a scant two percent in 2012 compared with 2011. That growth rate is less than half that of 2011, and marks the slowest growth since the depths of the financial crisis in 2009.
While Blackbaud doesn't calculate total dollar giving, its results have closely tracked giving totals from GivingUSA. Based on those numbers, Blackbaud expects charitable giving to amount to $304 billion in 2012.
Washington Times: Seven million will lose insurance under Obama health law
President Obama's health care law will push 7 million people out of their job-based insurance coverage — nearly twice the previous estimate, according to the latest estimates from the Congressional Budget Office released Tuesday.
CBO said that this year's tax cuts have changed the incentives for businesses and made it less attractive to pay for insurance, meaning fewer will decide to do so. Instead, they'll choose to pay a penalty to the government, totaling $13 billion in higher fees over the next decade.
But the non-partisan agency also expects fewer people to have to pay individual penalties to the IRS than it earlier projects, because of a better method for calculating incomes that found more people will be exempt.
Overall, the new health provisions are expected to cost the government $1.165 trillion over the next decade — the same as last year's projection.
With other spending cuts and tax increases called for in the health law, though, CBO still says Mr. Obama's signature achievement will reduce budget deficits in the short term.
During the health care debate Mr. Obama had said individuals would be able to keep their plans.
Daily Beast: Welcome to Botswana
Last week Standard & Poor’s downgraded Illinois’s credit rating to A-. Only California bears so low a rating, but S&P rates California’s future outlook as positive and Illinois’s as negative. The Moody’s (slightly different) rating system assesses Illinois at the same risk level it gives the African nation of Botswana.
It’s not easy to sum up all the aspects of the financial disaster that is Illinois: the fiasco has too many pieces, contributed by too many different politicians.
The state can’t pay its bills in the here and now: it started the 2013 fiscal year with almost $8 billion in unpaid bills, equal to almost one quarter of the state’s budget.
Illinois depends on federal aid to stagger through the year. In 2011 federal transfers accounted for more than one third of the state’s revenue. Now assistance from Washington is dwindling.
The costs of retirement benefits to Illinois’s retirees are rising faster than state revenue—meaning that even as the Illinois economy recovers from the recession, the state’s income is falling further and further behind its commitments.
Indeed, Illinois faces the worst pension shortfall of any state. The cost of pensions and health benefits to retired state employees has doubled over the past decade, to 15 percent of state spending. As the costs of benefits rise, the state is cutting budgets for schools, Medicaid, and corrections.
CARTOON OF THE DAY