Overview
Title
To amend the Congressional Budget and Impoundment Control Act of 1974 by requiring a distribution analysis of a bill or resolution under certain circumstances, and for other purposes.
ELI5 AI
H.R. 10289 is about making sure that when the government wants to change how it spends money, it checks how the changes will affect different groups of people, like those with different incomes, races, and genders, to help make things fair.
Summary AI
H.R. 10289, also known as the “Fiscal Analysis by Income and Race Scoring Act”, aims to amend the Congressional Budget and Impoundment Control Act of 1974. It mandates that when a bill has a significant budget impact, an analysis must be conducted to show how the bill will affect different income and racial groups in terms of income changes. The bill also requires a report to explore methods for analyzing how legislation impacts different genders, ensuring lawmakers have detailed information on how proposed laws affect economic inequality.
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AnalysisAI
General Summary of the Bill
The legislation in question, titled the "Fiscal Analysis by Income and Race Scoring Act" or the "FAIR Act," seeks to amend the Congressional Budget and Impoundment Control Act of 1974. It specifically aims to introduce requirements for examining the economic impact of significant bills on different income and racial groups within the United States. The bill mandates that the Congressional Budget Office (CBO) include a detailed distribution analysis for any bill with substantial budgetary implications, defined as a gross budgetary effect of at least 0.1 percent of the U.S. GDP. Additionally, the Joint Committee on Taxation is required to provide distribution analysis in conjunction with revenue estimates. The bill also calls for a report on how major legislation affects individuals based on gender.
Summary of Significant Issues
Several issues arise from the provisions within this bill. First, the requirement for detailed economic analyses—by income, race, and eventually gender—poses challenges in terms of complexity and resources. Conducting these comprehensive assessments requires substantial expertise and could prove costly and time-consuming. Furthermore, the bill sets a somewhat vague threshold for when such analyses are necessary, potentially leading to ambiguities in deciding which bills qualify for these evaluations.
Additionally, while the intention is to provide insight into the socioeconomic impacts of legislation, there is a lack of clarity surrounding the methodologies to be employed and the entities responsible for these analyses. This lack of specificity could result in inconsistent approaches and accountability issues. Moreover, terms critical to understanding the socioeconomic disparities, like "median net worth" and "median usual weekly earnings," are not elucidated in the bill, potentially confusing those not familiar with economic jargon.
Impact on the Public Broadly
The FAIR Act could have a broad impact on the public by striving to inform Congressional decisions with a clearer understanding of how proposed legislation affects various demographic groups economically. By highlighting disparities and potential unintended effects of bills, it aims to foster more equitable and informed policymaking. However, the execution of these analyses must be accurate and reliable to genuinely benefit decision-making and public understanding.
Impact on Specific Stakeholders
Positively:
Minority and Low-Income Communities: These groups could benefit from the insights generated by the required analyses, as the data might lead to policies designed to reduce economic disparities and improve socioeconomic outcomes.
Researchers and Economists: The demand for detailed distribution analyses could boost opportunities for professionals in economic research and data analysis fields, potentially leading to advancements in methodologies.
Negatively:
Government Agencies: Entities like the CBO could face increased burdens due to the need for additional resources and expertise to fulfill the requirements of conducting these analyses, which may strain their capacities.
Legislators: The legislative process might slow down as lawmakers await the complex analyses, especially for bills with significant economic implications, possibly delaying responses to urgent issues.
Overall, while the bill aims to ensure more equitable and informed legislative decisions, its practical implementation presents several challenges that need addressing to achieve its intended goals effectively.
Financial Assessment
The bill, H.R. 10289, titled the “Fiscal Analysis by Income and Race Scoring Act”, primarily revolves around the economic impacts of proposed legislation. Below is an analysis of the financial references and considerations within the bill, especially in the context of identified issues.
Financial References and Implications
Analysis Threshold and Economic Impact
The bill introduces a crucial financial reference in Section 3, which stipulates that any proposed bill or resolution with a gross budgetary effect of at least 0.1 percent of the United States' gross domestic product (GDP) in any fiscal year should undergo a distribution analysis by income and race. This includes evaluating how legislative changes would shift after-tax-and-transfer incomes across different demographics.
- The selection of 0.1 percent of GDP as a threshold raises questions about the clarity and precision needed for implementation. The lack of specific details might lead to varied interpretations and potentially exclude significant bills that could impact economic inequality but fall below this arbitrary cutoff. The ambiguity around this threshold is one of the issues identified, which could result in important bills not being rigorously analyzed for their financial impacts on different income and racial groups.
Challenges in Execution
Conducting a "distribution analysis by income and race" is inherently complex and resource-intensive. It demands accurate data collection and comprehensive methodologies to ensure reliability in outcomes. The bill does not specify which entity will be responsible for these analyses, leading to potential accountability and execution challenges. This also pertains to overall feasibility and cost concerns, as highlighted in the issues.
Additionally, the requirement to assess the economic impacts across racial and income lines may necessitate significant funding and innovative methodologies, which might not yet be fully developed or standardized. The bill’s lack of details on the financial resources needed to conduct thorough analyses further complicates its implementation.
Methodologies for Gender Analysis
Section 4 mandates a report to explore methods for analyzing the impact of major legislation on different genders. Though this section is forward-thinking, it lacks clarity on the methodologies or budget provisions for conducting such a complex financial analysis. The absence of specific financial allocations or a detailed framework could lead to inconsistencies in the analytical methods employed, which might jeopardize the credibility of the insights generated.
Findings Section and Economic Data
While the bill provides extensive data on wealth and income disparities, understanding such detailed economic terminologies could be challenging without clear explanations or definitions. For instance, terms like "median net worth" and "median usual weekly earnings" need specific definitions to help laypersons or lawmakers without an economics background accurately interpret this data. Despite not directly relating to financial appropriations, these references are crucial for framing the fiscal impact discussions the bill seeks to enhance.
Conclusion
The financial considerations in H.R. 10289 aim to provide lawmakers with deeper insights into how legislation might affect economic disparities across different demographic groups. However, the challenges in accurately implementing such analyses, given the resource demands and ambiguous thresholds, question the feasibility and effectiveness of such financial evaluations. Without additional clarity and funding provisions, the ability to execute these analyses might be significantly hindered, potentially impacting the bill's intended purpose of enhancing socio-economic understanding in legislative processes.
Issues
The requirement for a 'distribution analysis by income and race' in Section 3 could be challenging to implement accurately due to its complexity and resource-intensive nature, raising potential concerns about feasibility, costs, and accuracy of data and outcomes.
The threshold set for analysis involving a 'gross budgetary effect of at least 0.1 percent of the gross domestic product' is vaguely defined in Section 3, potentially causing ambiguity in its implementation and possibly excluding significant bills from analysis due to narrow interpretation.
Section 4 lacks clarity on specific methodologies, criteria, and budget for conducting a distribution analysis by gender, which might result in inconsistent methods and financial ambiguities, potentially impacting the credibility and effectiveness of the report.
There is no provision in the bill outlining which department or entity is responsible for conducting the distribution analyses required in Section 3, leading to potential issues with accountability and execution of the amendment.
The absence of detailed definitions and explanations in Section 2 regarding terms like 'median net worth' and 'median usual weekly earnings' might result in misunderstandings, especially among those unfamiliar with economic terminologies.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of the bill states the short title, which may be referred to as either the “Fiscal Analysis by Income and Race Scoring Act” or the “FAIR Act”.
2. Findings Read Opens in new tab
Summary AI
Congress has found that wealth inequality is increasing in the United States, with significant disparities between racial groups. Despite some growth, Black, Hispanic, and female-led households continue to have considerably less wealth and income compared to their White and male counterparts. Congress acknowledges the need for effective policies to address these growing inequities and requires reliable data to understand the economic impact of its legislation.
Money References
- (2) In 1968, and with the amounts adjusted for inflation, the median middle-class Black household had $6,674 in wealth, while the median middle-class White household had $70,786 in wealth, and in 2016, the median middle-class Black household had $13,024 in wealth compared to $149,703 for the median White household.
- (4) As of 2019, White families have the highest level of both median and mean family wealth at $188,200 and $983,400, respectively.
- Black families’ median and mean wealth is less than 15 percent that of White families, at $24,100 and $142,500, respectively.
- Hispanic families’ median and mean wealth is $36,100 and $165,500, respectively.
- (5) In 2023, the median annual income for households led by Asian-Americans was $112,200, compared with $89,050 for non-Hispanic White-led households, $56,490 for Black-led households, and $65,540 for Hispanic-led households.
- (7) As of the second quarter of 2024, women earned roughly 81 cents for every dollar paid to men, as measured by median usual weekly earnings for full time wage and salary workers, and for every dollar paid to White men, Black women earned roughly 71 cents, and Hispanic women earned roughly 65 cents. (8) Different groups within the Asian American and Pacific Islander community have unique experiences with economic discrimination.
- For example, between 2015 and 2019, Hmong women earned 60 cents for every dollar paid to White men.
- As of 2022, the median net worth for female-led households was $58,080, whereas male-led households had a median net worth of $82,200, and a study from 2013 showed that single Black women and single Hispanic women had a median wealth averaging less than a penny for every dollar of wealth owned by single White non-Hispanic men.
3. Distribution analysis by income and race Read Opens in new tab
Summary AI
The section of the bill amends the Congressional Budget and Impoundment Control Act to require the Congressional Budget Office to perform and include in certain reports a distribution analysis by income and race for bills with significant budget impacts. It also updates how the Joint Committee on Taxation should include distribution analyses alongside revenue estimates.
Money References
- (a) CBO estimates.—Section 402 of the Congressional Budget and Impoundment Control Act of 1974 (2 U.S.C. 653) is amended— (1) in paragraph (2), by striking “and” at the end; (2) in paragraph (3), by striking the period at the end and inserting “; and”; (3) by inserting after paragraph (3), and before the flush text, the following: “(4) for a bill or joint resolution that has a gross budgetary effect of at least 0.1 percent of the gross domestic product of the United States in any fiscal year within the budget window— “(A) a distribution analysis by income showing the transfers that would result in dollars and as a percent change in after-tax-and-transfer income for as many years in the budget as is necessary to illustrate the anticipated effects; and “(B) a distribution analysis by race showing the transfers that would result in dollars and as a percent change in after-tax-and-transfer income for as many years in the budget as is necessary to illustrate the anticipated effects.”; and (4) in the flush text following paragraph (4), as added by paragraph (3) of this subsection, by striking “and description” and inserting “description, and analyses”.
4. Report on distribution analysis by gender Read Opens in new tab
Summary AI
The section requires the Director of the Congressional Budget Office to create and submit a report within a year, detailing methods for analyzing how major legislation affects people differently based on gender. This report should also highlight the pros and cons of various approaches and be sent to specific committees in the Senate and House.