Vance Ginn Economics
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  • Home
  • About
  • CV
  • Media
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  • Show/Speeches
  • Publications
  • Teaching
    • ECON 2301-Princ of Macro
    • ECON 2302-Princ of Micro
    • ECON 3352-Energy Eco

Let People Prosper Newsletter #10: Fiscal Insanity

12/30/2020

 
Read my full newsletter with charts and subscribe here. 

Hello Friend!
As 2020 nears an end, I’d like to start this newsletter a bit different to share some personal things about me that you might not know. We will then get into the many things that have happened since the newsletter last week.
Here are the highlights of my life’s journey so far:
  • born on Nov.12, 1981 at Clear Lake Hospital in Texas and raised in the South Houston area;
  • battled severe asthma and allergies with multiple hospital visits for asthma and three rounds of allergy shot treatments over time;
  • watched my dad have seizures and learned from his optimism and intellect throughout his battle with epilepsy;
  • grew up in a single-mother, relatively lower-income household for most of my life after my parents divorced twice before I was 10;
  • learned strength and love from my mom who struggled while raising my sister and me and gained wisdom from my grandparents;
  • completed K-2 grades at a private school, 3-6 grades at public schools, and 7-12 grades at home school (graduated at 17 yrs old);
  • experienced life as a "rockstar" in the band Sindrome, which was a top rock band in Houston, and was a tumultuous period as a young adult (17-20 yrs old);
  • flipped at least 6 times as a front passenger in a 2002 Acura RSX after wrecking into the back of an SUV while racing at around 120 mph and then life-flighted to a hospital in Houston with a potential head injury but was released that night (20 yrs old);
  • turned closer to God and prayed for His guidance which directed me toward my calling of helping others through His lessons and the tools of economics;
  • enjoyed my time at Texas Tech University and learned much in courses, gained many great friends, and led several organizations;
  • the unexpected loss of my father from SUDEP when I was 29 yrs old;
  • graduated in 2013 with a Ph.D. in economics from TTU after neither parent graduated college (31 yrs old);
  • worked as a lecturer at institutions of higher education, as a chief economist at the White House, and now chief economist at TPPF, which is a top think tank in the nation; and
  • now at 39 yrs old, I’m blessed to have God’s grace, be married to an inspiring woman, have two amazing boys, have had an experience in Virginia but glad to be back in Texas, and continue living my dreams.
  • There’s no way that I could have planned this. The ups and downs. The uncertainty, faith, fear, and love. These events and many more make me the man I am today.
  • As 2020 comes to a close, I thank God for these blessings and the courage to overcome many obstacles along the way, including many of them this year.
  • I started praying about and choosing a word to act as a guide each year since 2018. My word for 2018 was “prosper,” 2019 was “flourish”, and 2020 is “thrive,” which was perfect.
  • My word for 2021 is “serve” because I know that there will be many challenges that come along but as long as I’m serving God and others then the rest will work for my good. What’s your word? (Leave in comments or email me)
  • Thank you for your friendship. I hope my testimony can help some know that anyone can reach their goals with God’s favor and one’s endurance. Here’s to a spectacular 2021!
OPEN TEXAS AND AMERICASummary:
  • As of December 29, there are 12 Trauma Service Areas (TSA) on the Governor’s list for elevated restrictions that include 56% of Texans. The 7-day moving average of new COVID-19 cases looks to have plateaued and are 20% above their summer highs while fatalities are 40% below then.
  • Available total hospital capacity statewide is near the average of 26% since June.
  • Austin area has the lowest rate of COVID-19 hospitalizations as a share of total hospital capacity or staffed inpatient beds while keeping a normal rate of available capacity of 26% since June.
  • These data put into question the increased restrictions across the state, mainly on what appears to be flawed forecasting models. Here’s an example.
 
  • The 7-day average of new confirmed cases in Texas looks to have plateaued since Dec. 7 at about 12K on Dec. 29, with the highest new daily of 26,990 on Dec. 29—likely from more people congregating over Christmas. The 7-day average of new fatalities in Texas on Dec. 16 (latest data available) was 160—possibly already peaked although more recorded death certificates will be reported.
  • 7-day averages of cases remain well above the highs over the summer (12K v 10K) while fatalities remain well below their highs then (250 vs. 150), meaning the case-fatality rate has so far been substantially lower now than during the highs over the summer.
  • There remains a relatively high rate of available hospital capacity (I’ve updated this to total hospital capacity from my previous reports to match the Governor’s metric and increased capacity opportunities not represented by staffed inpatient beds) across most of the state’s TSAs with every TSA having at least 16% available—30% available statewide.
  • Testing remains on average around 100K per day and the positivity rate remains elevated (17% for new molecular tests and 11% for new antigen tests) but well below the high rates during the summer (25% for new molecular tests and 20% for new antigen tests) though with substantially fewer tests (about 40K during July).
  • While debatable, improvements could be from better therapeutics, younger and healthier population infected, better utilization of hospital resources, and Governor Abbott’s more targeted, timely, and temporary policy approach of examining hospitalizations per TSA and sending resources where needed most.
Texas Governor Abbott Metric Overview:
  • Per GA’s metric of COVID-19 hospitalizations as a share of total hospital capacity for seven consecutive days, TSAs below 15% can have most businesses expand to 75% capacity, keep state mask mandate, and bars (and others) open to 50% capacity with the approval of the county’s judge.
  • 12 of 22 TSAs are reported on the list of further restrictions: A (Amarillo), B (Lubbock), D (Abilene), E (Dallas/Ft. Worth), G (Longview/Tyler), H (Lufkin), I (El Paso), M (Waco), N (Bryan/College Station), P (San Antonio), R (Galveston), and TSA T (Laredo).
  • 56% of Texans are at 50% capacity + other restrictions while 44% of Texans are at 75% capacity + other restrictions.
  • This CV19-to-capacity metric has been rising recently statewide since mid-Oct. to 17.4%, which is near July’s 17.0% average.
Hospital Overview Statewide:
  • COVID-19 hospitalizations up 14.3% (to 11,775 hospitalizations) from 7 days ago and up 24.3% from 14 days ago, the level is above July’s 9,713 average
  • Available beds as a share of total hospital capacity up to 30.5%, well above the averages of 23.7% in July and of 26% since June
  • Hospital capacity up 2.4% (to 67,495 beds) from 7 days ago and up 4.8% from 14 days ago, the level is well above July’s 56,871 average

TEXAS ECONOMIC AND FISCAL SITUATION
Texas’ Legislative Session Starts Jan. 12: More to come on this soon! I’m looking forward to TPPF’s Policy Orientation on Jan. 13-15 that will be live-streamed, so I’ll be sure to add info about it later.

Read the entire newsletter here: ​https://vanceginn.substack.com/p/fiscal-insanity-dc-disappoints-again

Let People Prosper Newsletter #9: Coronavirus or Bust

12/26/2020

 
​Hello Friend!
​
I hope you had a blessed Christmas. My family did as we celebrated Jesus’ birth and his eventual death on the cross for our sins. That salvation came at a great cost, yet another example of how nothing is free. We’re now relaxing after a great day playing outside with our boys and hanging out with friends. Those moments are priceless.

What’s not priceless is the latest $908 billion COVID aid bill along with the omnibus that’s combined to be over $2 trillion and appropriately called the “coronabus” given how much pork is in this package. I’ve been calling it “CARES 3.0” because there was the original bill and another bill that added funding to the programs created in the original bill, so this is really the third bill that’s funding many of the same things.

And that’s part of the problem, as it comes with a huge cost and President Trump is correct to hint at vetoing it. However, the President’s reasoning seems to be to increase the amount in checks to individuals from $600 to $2,000, which would push incomes well above where they were before the pandemic and provide income to many individuals who weren’t influenced much if at all from the shutdown. This is likely the case for you and me, as we are able to work from home or have savings to live on for a while to deal with this situation. I get the point of advocating for more in a check to individuals as it appeals to struggling Americans and balances some of the atrocities in this monstrosity of a bill, but that doesn’t make it good policy.

This notes the importance of work flexibility along with saving for a rainy day but also notes the huge cost to those who aren’t in this boat. Unfortunately, too many have and will continue to fall through the cracks of our economic lifeline that should ultimately be improved by moving toward more capitalism and away from socialism. While civil society should be first to help those in need, governments will play a role though hopefully a more limited one as it assists those who can’t be helped otherwise (last resort). This would help improve our bloated, ineffective safety net system that often just expands bureaucracy and helps too many of those the programs were not intended.

Thanks again for reading! I’m truly grateful for you continuing to read this newsletter. As 2020 comes to a close, we have much to accomplish to find opportunities to let people prosper.

If you haven’t signed up for my newsletter yet, please register here at no charge. And follow me on Twitter: @vanceginn.
Have a Happy New Year if I don’t write another newsletter before then, which I may given how things go in D.C. Until then, many blessings to you and yours.
Vance Ginn, Ph.D. | www.vanceginn.com | #LetPeopleProsper

Schooling options are essential during COVID

12/19/2020

 
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​Are your kids getting the education they need—either in person, or remotely? It might depend on where you live; it should instead be up to you.

Schools shut down last spring. Some reopened in the fall, some did not. Others, like those in New York City, are closing again. Some schools are trying to mix in-person and virtual instruction.

This confusion should be alleviated as much as possible by allowing parents to decide which schooling is best for their kids.

Based on the evidence, it seems that schools can safely keep in-person instruction as they aren’t super-spreaders, and that many students benefit from this kind of instruction. A recent national poll found that more than 50% of parents are comfortable with returning to school. The same poll found that half of parents with a choice selected remote education for their children.

Ultimately, decisions about schooling should happen closest to students, starting with their parents. The COVID-19 shutdowns have shown us the need for school choice—letting parents decide what schooling works best for their children.

Families with means already have more choices, of course. Some have chosen to put their kids in private schools or home school. But other families can’t afford this and must try to make their public school work—while also trying to make ends meet.

For example, virtual instruction usually requires an adult’s care to ensure that a child is able to access instruction and learn. This puts extra pressure on working families—they might have to miss work or pay someone else for childcare.

We know that normal school breaks can lead to widened educational disparities. Continued school shutdowns could also lead to widening racial wealth disparities in America. A McKinsey study reported that the educational level of the average Black or Hispanic student is two years behind the average white student, based on many factors—including place of residence and wealth disparity.

That study also indicates that if in-person instruction doesn’t occur until January 2021 and students receive remote instruction at reduced learning rates (or even no instruction at all), “white students would earn $1,348 a year less (1.6% reduction) over a 40-year working life, [but] the figure is $2,186 a year (3.3% reduction) for Black students and $1,809 (3.0% reduction) for Hispanic ones.”

Continuity in students’ educational experiences are also at the forefront of parents’ concerns.

A recent survey of 600 full-time, public school teachers across the nation showed that 67% of teachers agreed that completion rates of assignments were worse during distance learning than in-person instruction.

The concern is especially high with low-income earners. The Texas Education Agency, for instance, reported a 55.6% drop this spring in progress for online math coursework for low-income families.

Still, for many families, the threat from COVID-19 is more concerning than the potential drawbacks of remote instruction, particularly for students or family members who are immunocompromised. And there are at least some families who have thrived in a remote education setting.

In the end, parents know their situations and concerns best. The choice should be theirs. In-person schooling, remote learning, or some other model should be their call.

The burden shouldn’t lie on parents to be flexible (and accepting of whatever school officials tell them they’ll receive); it’s the school districts that must be flexible—and accountable.

Child development doesn’t stop for COVID-19, or any other disruption. We owe American families the flexibility they need to keep their kids on track. And that should start with more choices for parents rather than top-down mandates by governments.

https://www.texaspolicy.com/schooling-options-are-essential-during-covid/

Let People Prosper Newsletter #8: TPPF's Responsible Recovery Agenda

12/18/2020

 
Read the full newsletter with figures and subscribe here. 

​Hello Friend!
Can you believe that Christmas and New Year’s are right around the corner? It’s hard for me to believe.
We put up our Christmas tree early this year to get into the spirit of celebrating Jesus’ birth and the salvation and grace provided to us through a huge price (Nothing is Free), and this spirit has helped drown some of the negativity going on in the media regarding COVID, the election, and more. I have a lot of what I consider uplifting points to share with you below.
It’s important to remember that we live in the most prosperous, most remarkable, and most opportunistic country in the history of man. Sure, there’s much we need to do to improve it because too many have fallen through the cracks, but we have much to be positive about even as the media and many politicians tell us otherwise.
So, get your optimistic cap on and maybe grab your favorite drink so you can imagine me telling you the following story. Enjoy!

Have a blessed weekend and a Merry Christmas and Happy New Year in case I don’t see you or write another newsletter before then. I’m truly thankful for you and for your interest in reading this newsletter. My only request is that you share this newsletter with at least one of your friends and ask them to register. That would be a great gift!
Vance Ginn, Ph.D. | www.vanceginn.com | #LetPeopleProsper

Ending Medicaid’s Enhanced Maintenance-of-Effort Provisions

12/15/2020

 
In March 2020, during the early part of the COVID-19 pandemic, the U.S. Congress passed the Families First Coronavirus Response Act and then the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The “maintenance of effort” (MOE) provisions authorized in the Families First Act and then enhanced by the CARES Act were to provide a 6.2 percentage point increase in the normal share of Medicaid payments provided to states through the Federal Medical Assistance Percentage (FMAP).

These provisions require that those eligible for Medicaid must be kept on the program up to 90 days after the declaration of a public health emergency for COVID-19 ends whether they age out of an eligibility group, have an increase in income, or other reasons noted by the Kaiser Family Foundation (more info at Medicaid.gov). The Health and Human Services declaration, which is set to expire on January 20, 2021, should not be renewed by the secretary as this enhanced MOE could represent an increased cost to taxpayers to fund more people on Medicaid along with an increased dependence on the program for people not meant to be on it.

https://www.texaspolicy.com/ending-medicaids-enhanced-maintenance-of-effort-provisions/

Ginn Economic Brief on Texas' Economic & Fiscal Situations: Dec 2020

12/15/2020

 
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The Texas economy has continued to recover since the steep downturn due to the COVID-19 pandemic and shutdowns by state and local governments in March. The partial reopening of most non-essential businesses has been a key part of that recovery, but the rise in COVID-19 hospitalizations has contributed to increased capacity restrictions that have slowed economic activity.

https://www.texaspolicy.com/texaseconomy/

Ginn Economic Brief on US Economic & Fiscal Situations: December 2020

12/14/2020

 
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Many Americans are recovering after the economic collapse that began in March due to the COVID-19 pandemic and shutdowns by state and local governments.

While the strength of that recovery has weakened, a sound policy approach will help support a safe, expedited, and less debt-riddled rebound so Americans have more opportunities to prosper.

https://www.texaspolicy.com/the-ginn-economic-brief/

TPPF Releases Responsible Recovery Agenda

12/10/2020

 
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​Today, the Texas Public Policy Foundation released five papers that together form a responsible strategy for the state’s immediate and long-term economic growth.

“These five approaches make for good economic policy anytime,” said TPPF Chief Economist Vance Ginn, Ph.D. “But they are especially important as the state recovers from government-imposed shutdowns. Together, these strategies will help return Texas to the prosperity we saw before COVID-19 and help get us there fast.”

The Five-Step Strategy is:
  1. Pass a Conservative Texas Budget
  2. Reduce Government Spending
  3. Reduce Regulatory Burdens
  4. Reject Increased Taxes
  5. Use the Rainy Day Fund Responsibly

“During the shutdown, the state suspended some rules and regulations, proving they weren’t essential for health and safety in the first place,” said Rod Bordelon, TPPF’s Policy Director for the Remember the Taxpayer Campaign. “Instead of waiting for the crisis to end to re-evaluate these regulations, we should repeal them now and review others in an ongoing basis so that Texans aren’t held back by unnecessary restrictions.”

The Responsible Recovery Agenda also stresses that budget writers should avoid seeking additional state revenue through increased fees and taxes.

“Raising taxes is a costly endeavor — even more so in a recession because it distorts behavior at a time when the economy is weak, delaying recovery and leading to even greater economic stress,” said Benjamin Priday, Ph.D., Economist at TPPF. “Legislators should close budget gaps first by strategically employing the Rainy Day Fund and by trying to find ways to reduce spending.

The Responsible Recovery Agenda is a comprehensive approach to addressing the budget challenges Texas faces in the wake of COVID-19 shutdowns while also preserving the success of the Texas Model, which has strengthened the state’s economy.

​For a historical look at the budget and other ways to improve the budget process, the Foundation also released The Real Texas Budget report.

Texas’s Rainy Day Fund: How to Use It Responsibly

12/10/2020

 
​Texas’s Economic Stabilization Fund (or “rainy day fund”) is a valuable tool for covering unexpected shortfalls in tax receipts, like those during the COVID-19 pandemic, but it should be used sparingly, and budget reductions should be prioritized instead.

Key points:
  • Texas ranks high in economic growth and must maintain a balanced budget, but the current economic situation could strain Texas taxpayers’ ability to pay for the state budget.
  • Texas must exercise fiscal restraint and find responsible budget reductions before it taps into the state’s rainy day fund.
  • Texas state leaders have appropriately begun the process of finding savings in the budget, but additional savings are likely needed and should be realized before using taxpayer money in the rainy day fund.

https://www.texaspolicy.com/texass-rainy-day-fund-how-to-use-it-responsibly/

Prioritizing Texas Budget Reductions Amid Deficits Due to the COVID-19-Induced Recession

12/10/2020

 
The COVID-19-induced recession in Texas has strained the ability of many Texans to pay taxes to fund the state’s budget. The Legislature should consider prioritizing budget reductions to cover any potential budget shortfall.

Key points:
  • Texas usually ranks high in economic prosperity and must maintain a balanced budget, but the COVID-19-induced recession has put pressure on taxpayers to fund the tax receipts needed to cover the state’s budget.
  • Texas must prioritize fiscal restraint by finding responsible budget reductions to deal with any potential budget shortfall.
  • Statewide elected officials have appropriately begun the process of prioritizing budget cuts by directing some state agencies to identify 5% reductions in their existing 2020-2021 budgets, but additional cuts may be necessary.
  • As with past shortfalls, the Legislature should work with state agencies and adopt zero-based budgeting to prioritize program spending and identify responsible spending cuts while maintaining necessary services.

https://www.texaspolicy.com/prioritizing-texas-budget-reductions-amid-deficits-due-to-the-covid-19-induced-recession/

2020 Real Texas Budget: The State of Texas’s Spending

12/10/2020

 
The Real Texas Budget provides an overview of government spending from 2004-05 to 2018-19. It demonstrates the need for reforms to restrain the growth of government spending and increase budget transparency.

​Key points:
  • Over the last 16 years, Texas state spending has increased faster than the pace of population growth plus inflation, at the excessive cost of $33.1 billion to taxpayers, or almost $2,300 for a family of four annually, on average
  • The Real Texas Budget demonstrates the need for government spending restraint and an improved budget process.
  • Legislators should pass a Conservative Texas Budget in 2021, holding any growth in initial appropriations of all funds to less than population growth plus inflation of 5% to $246.8 billion, excluding explicitly related COVID-19 funds.

https://www.texaspolicy.com/2020-real-texas-budget-the-state-of-texass-spending/

Let People Prosper Newsletter #7: Institutions Matter

12/5/2020

 
Read full newsletter with figures and subscribe here. 

​Hello Friend!
I hope you had a blessed Thanksgiving however you chose to celebrate it. I had a nice time with my family from Houston at our place in Round Rock and then a nice time with my in-laws in Port Aransas, which is on the beach near Corpus Christi, Texas. The picture below is of my youngest son playing in the water.
It’s been an interesting time that’s normally spent with family. But many have decided not to do so, which is a decision that should be left to individuals instead of politicians trying to tell people how to act.
One thing that I’ve been concerned about is missing time with my family and friends and never seeing them again—for many reasons. The COVID-19 situation is serious and one that should be taken seriously, as noted in my previous newsletter, but it is also a situation where I have taken time to grow closer to God, family, and friends when so much else seems to be uncertain. This has given me calm during this storm as I know that these relationships are what matter over time while the novel coronavirus is just a blip in the long run scheme of things.
Of course, the repercussions of authoritarian forms of government interventions may last much longer, which is something that we must continue to push back on when necessary.
To be frank, I think we should open Texas and all states, as the shutdowns were a mistake, and instead do what should have been done in the beginning and have the government play an informational role to provide guidance on best practices while targeting resources to vulnerable populations and areas as I outlined in a recent commentary at the Austin American-Statesman. I say this with a great deal of humility as there are many factors that go into making these decisions and I understand that I could be wrong. But I also believe strongly in the power of liberty and allowing individuals, families, and entrepreneurs in an inclusive institutional framework (like the Texas Model) to find the best path to dealing with these sorts of crises rather than the government.
Thanks again for reading! I hope this newsletter is marginally beneficial to you and will hopefully help us to find opportunities to let people prosper.
Vance Ginn, Ph.D. | www.vanceginn.com | #LetPeopleProsper

TPPF Statement on the Passing of Esteemed Economist Walter Williams

12/2/2020

 
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We at the Texas Public Policy Foundation are saddened to learn of the passing of economist Walter E. Williams.

“Walter Williams’s journey from the projects of Philadelphia to a professorship in economics at George Mason University—and becoming one of the most recognized and respected conservative voices of our time—was remarkable,” said TPPF Executive Director Kevin Roberts. “His great gift was communicating complex economic principles in everyday language. Always a cheerful combatant—yet one who would ‘Suffer No Fools,’ as the title of a documentary about him pointed out—Walter was an effective advocate for freedom.”

“There are few people who so eloquently explained how people can prosper—given scarce resources and limited government involvement—than the free market economist Walter Williams,” said TPPF Chief Economist Vance Ginn. “It was a pleasure to read and learn from his many academic publications, commentaries, and books over the years. While it’s a day to mourn his loss, let’s also celebrate his many gifts to us and continue to build on them, so that every person has the best chance to thrive in life—like he did.”

https://www.texaspolicy.com/press/tppf-statement-on-the-passing-of-esteemed-economist-walter-williams

    Vance Ginn, Ph.D.
    Chief Economist
    ​TPPF
    ​#LetPeopleProsper

    Vance Ginn, Ph.D., is founder and president of Ginn Economic Consulting, LLC. He is chief economist at Pelican Institute for Public Policy and senior fellow at Young Americans for Liberty and other institutions. He previously served as the associate director for economic policy of the White House’s Office of Management and Budget, 2019-20.

    Follow him on Twitter: @vanceginn

    View my profile on LinkedIn

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