In a series of sketches for Saturday Night Live, Billy Crystal played a fictionalized version of actor and director Fernando Lamas as host of the talk show “Fernando’s Hideaway.” Crystal’s character would often say that it is better to look good than to feel good.

This was on my mind as I reviewed recent evaluations of St. Louis’s guaranteed basic income pilot by Washington University’s Center for Social Development. The review’s claims will sound familiar to anyone who has followed these pilot programs around the country. Participants reported feeling more financially secure. They were better able to pay bills and cover everyday expenses like rent, utilities, and groceries.

In many ways, the findings are exactly what one would expect. St. Louis distributed $500 per month for 18 months to several hundred households using federal pandemic relief funds. If someone suddenly receives an additional $500 each month, it should not surprise anyone that paying bills becomes easier in the short run.

The St. Louis program is also not unique. Over the past several years, cities across the country have launched similar guaranteed income pilot programs. Their evaluations tend to report the same kinds of outcomes: reduced financial stress, improved food security, and higher levels of self-reported well-being.

But as economists Hilary Hoynes and Jesse Rothstein of the University of California, Berkeley note in a review of the universal basic income literature, the new wave of guaranteed-income pilots is “not well suited” to answer the most important questions about the policy. (My colleague David Stokes wrote about this same study in 2024.) The pilot program evaluations tend to measure short-run responses that economists have already examined for decades in earlier experiments.

These evaluations often measure something quite narrow—how recipients say they feel about their financial situation. But feeling good about one’s finances is not the same thing as actually being better off.

More comprehensive research on guaranteed income programs paints a more complicated picture. A recent randomized study published by the National Bureau of Economic Research examined the effects of unconditional cash transfers using a large experimental design. In that study, 1,000 individuals were randomly selected to receive $1,000 per month for three years, while a control group received only a nominal payment.

The researchers tracked employment, income, and time use using administrative data and detailed surveys. Their findings suggest that while the payments increased consumption and temporarily improved subjective well-being, participants also worked fewer hours and saw declines in income earned from work. The transfers reduced labor-force participation and led participants to shift some of their time away from paid work and toward leisure.

In other words, the transfers made recipients feel more financially secure—but they also changed work behavior in ways that reduced earned income.

This should not come as a surprise. Economists have been studying guaranteed income–style policies for decades. Earlier negative income tax experiments and other research on income transfers have consistently found that unconditional income tends to reduce work effort modestly. Those effects may be small, but they are real and have important implications for the long-term economic impact of such policies.

None of this is to say that guaranteed income programs provide no benefit to recipients, or that the research from Washington University is flawed. Reducing financial stress and helping families weather unexpected expenses is not nothing. But policymakers should be careful not to confuse the short-term financial relief detailed in the St. Louis pilot program evaluation with long-term economic improvement.

There are also broader societal concerns that pilot evaluations like this one cannot address. One of the Show-Me Institute’s objectives is to build a state where “all Missourians are free from dependence on government.” Large unconditional cash-transfer programs, such as the program tested in St. Louis, could expand long-term dependency on government support and weaken incentives for work and self-sufficiency. That risk remains a significant policy concern.

Feeling better about your finances is not the same thing as improving the underlying economics—regardless of what Billy Crystal might advise.

Local leaders must be careful not to confuse the two, lest we commit to an expensive program that does more harm than good.

The post Economically, Feeling Better Isn’t the Same as Being Better appeared first on Show-Me Institute.

Listen on Spotify

Listen on Apple Podcasts 

Listen on SoundCloud

The post How Kansas STAR Bonds Work for Stadium Projects appeared first on Show-Me Institute.

David Stokes, Elias Tsapelas, and Avery Frank join Zach Lawhorn to discuss: the cancellation of the St. Louis MetroLink Green Line and what bus rapid transit could mean for the city, major changes to the Supplemental Nutrition Assistance Program (SNAP) under the One Big Beautiful Bill, and Missouri’s worsening reading crisis and how other states have improved with reforms like third grade retention.

Listen on Spotify

Listen on Apple Podcasts 

Listen on SoundCloud

Timestamps

00:00 Cancellation of the Green Line Project
08:12 Changes to the SNAP Program
17:18 Reading Retention and Educational Reforms
26:10 Property Tax Reassessments in Platte County

Produced by Show-Me Opportunity

The post MetroLink Line Canceled, SNAP Reform, and Missouri’s Reading Crisis | Roundtable appeared first on Show-Me Institute.

At the center of the issue is what’s called the “Thrifty Food Plan,” which is the formula the USDA uses to set SNAP benefits every year. In short, the formula is designed to determine the cost of a basic but nutritious diet, given the USDA’s dietary guidelines. For decades, the Thrifty Food Plan was adjusted yearly to account for the increased costs families saw in their grocery bills. But in 2021, the formula was changed to boost benefits by around 21%, far exceeding inflation.

The precise way the formula was adjusted is complicated and goes beyond the scope of this post, but suffice it to say that both the foods included in the calculation and their cost were changed to increase national SNAP expenditures by roughly $200 billion over ten years, all without an act of Congress. Historically, major changes to the Thrifty Food Plan beyond inflationary cost increases have been the result of legislation. Such a significant change without explicit approval led many to call for its immediate reversal, arguing the move violated federal law and years of precedent.

After several years of higher SNAP spending, the OBBB finally addresses the issue created in 2021. The law now ties Thrifty Food Plan increases to inflation and specifies how often the foods included in the calculation can be re-evaluated. While this may not seem like some groundbreaking change, it’s an important step to protect against future bureaucratic attempts to expand welfare benefits without congressional approval, and could ultimately save Missouri taxpayers money.

As I wrote recently, in an effort to improve SNAP’s program integrity, the OBBB will soon start putting states on the hook for a portion of benefit costs if they can’t get their payment error rates under control. Keep in mind that until the OBBB is fully implemented, the federal government covers 100% of all SNAP benefits. Meanwhile, states have overpaid recipients nearly 10% of the time. By changing the incentives, states now have a reason to lower their error rates, which should reduce wasteful spending. The Thrifty Food Plan change will also help states (maybe including Missouri) that become responsible for a portion of benefit costs (because their payment error rates are too high) from being subject to unanticipated large program cost increases in future years.

The Thrifty Food Plan changes will help rein in the administrative state and encourage states to be better stewards of taxpayer money. Missouri’s policymakers and taxpayers should welcome the return of thrift to SNAP.

The post More SNAP Changes: Restoring Thrift appeared first on Show-Me Institute.

For Missouri, perhaps the biggest change will be the cost of SNAP going up. Unlike Medicaid, the federal government has historically paid for 100% of the SNAP benefit, with states only on the hook for 50% of its administrative costs. The OBBB increases the share of administrative costs borne by states to 75%, and has the potential to start charging states for some program benefit costs as well.

There’s a noticeable focus in the OBBB on improving program integrity in America’s welfare programs. With Medicaid, the focus was on checking program recipients’ eligibility more frequently. For SNAP, the focus is on reducing state payment error rates. Last year, the national rate of overpayment for SNAP (awarding benefits to people who don’t qualify or offering more benefits than the recipient was eligible for) approached 10%, with Missouri not much behind at 8.16%. Perhaps the most surprising thing about the payment errors is that they’re almost entirely overpayments. The error rate for underpayments barely exceeds 1%.

To be clear, there could be myriad reasons for the errors, but it shouldn’t be controversial to say that the government needs to do better. One possible explanation is that states tend toward overpayments because they aren’t responsible for the cost. The OBBB tries to address this misaligned incentive by requiring states to get their error rates below 6% by 2028; states that fail to meet this goal will need to start paying for a portion of the cost, with the share scaling by how far away the state is from the 6% goal.

All told, the SNAP changes contained in the OBBB could have a greater impact on Missouri’s budget than the changes to Medicaid. According to the Tax Foundation, these new costs could reach up to $400 million per year for Missouri if the state isn’t able to sufficiently reduce its payment error rate. It’s important to remember that the only guaranteed increase in cost for states is the higher share required for administrative services. If Missouri can find efficiencies in how it administers the program, the state’s cost might not need to go up much at all.

In the coming weeks, I’ll explain more about the OBBB’s changes to SNAP (no, these aren’t all of them), but these are the two that could have the largest impact on Missouri’s budget. Now that the federal government has finally gotten around to tackling the many broken incentives in America’s welfare system, it’s time for Missouri to step up and follow through on enacting comprehensive reform.

The post SNAP Back to Reality appeared first on Show-Me Institute.

Susan Pendergrass is joined again by Elias Tsapelas, director of state budget and fiscal policy at the Show-Me Institute, for Part II of their conversation on the sweeping federal legislation known as the “One Big Beautiful Bill.” They unpack what the bill means for Missouri taxpayers, including changes to the standard deduction, tips and overtime, education savings accounts, and higher education policy. They also dig into the bill’s broader fiscal impact, from the growing federal deficit to the implementation challenges facing state governments.

Listen on Spotify

Listen on Apple Podcasts 

Listen on SoundCloud

Timestamps

00:00 Exploring the One Big Beautiful Bill
04:58 Tax Implications for Missourians
10:20 New Savings Accounts for Children
12:07 Changes in Higher Education
18:09 Federal Deficit and Debt Concerns

Listen to Part I Here

Episode Transcript: One Big Beautiful Bill Breakdown, Part II with Elias Tsapelas 

(Download Here)

Susan Pendergrass (00:00)
So I guess it turns out that the One Big Beautiful Bill was too big for us to talk about in one podcast. Elias, thanks for coming back. I realized after we stopped recording that there’s so much in there we didn’t even discuss. We barely even really got into it. So let’s talk about more of the One Big Beautiful Bill because it’s huge—hundreds, at least hundreds of pages long. And I can’t believe the people who voted on it read it through carefully. Now, as you’re going through it and learning things, I’d love for you to explain some of it to me.

Starting with—how does the no tax on tips and overtime work? I’ve heard a lot about this. I know it was a campaign promise. So is it true that if you’re waiting tables now and you get a few hundred bucks a night in tips, you don’t have to pay tax on it now?

Elias Tsapelas (00:51)
In theory, yes. Now, it’s not clear if it’s going to be something that impacts Missouri tax liability. It sort of impacts the federal tax code a little differently than the increased standard deduction and some of the other changes. So it might change some federal tax liability, but unless Missouri’s legislature changes some stuff, it’s not going to immediately impact Missouri taxes.

Susan Pendergrass (01:16)
But why—do you have to itemize to do it?

Elias Tsapelas (01:19)
No. Basically, Missouri has rolling conformity with the federal government. Missouri takes its gross income from the federal government, and the tax on tips and overtime piece isn’t going to impact the gross income calculation. So it may or may not become an issue in Missouri.

There’s also a big open question here about how much income tip workers are actually claiming, and how much that will change if you say it’s not taxed—because if they weren’t declaring it before, we don’t really know what the change will be.

Susan Pendergrass (02:05)
Yeah, so if you walk home with a wad of cash, you’re not necessarily going to add it up and write it down and claim it.

Elias Tsapelas (02:09)
It still might not be worth declaring all of it. But if Missouri brings it into the state income tax code, it could cost quite a bit of money. There are quite a few tax provisions here—especially on corporate tax—where we really don’t know how much it’s going to cost, but it’s probably going to be significant. There’s full expensing, depreciation, all kinds of things that are going to change both federal and Missouri tax liability. And then there was the standard deduction change we mentioned last time.

Susan Pendergrass (02:47)
Okay. So one thing that does impact Missourians is our tax credit scholarship program, where you can donate to a scholarship-granting organization like the Archdiocese of St. Louis, and they give out scholarships. Right now, you can get a Missouri state income tax credit for that—up to half of how much you owe the state. And now there’s a new program where you can take a federal credit of up to $1,700 for donating to these organizations.

You can’t get credits for both on the same donation, but you could donate up to half your tax liability and get the Missouri credit, and then separately donate $1,700 and get the federal credit. I know there’s a lot of rulemaking still to come, and I also know this program doesn’t start until January 2027. So it won’t affect people’s returns until April 2028. But—how do you think that’s going to work? Do you have any idea based on what you’ve read?

Elias Tsapelas (03:54)
Well, Missouri has to opt in first, right? I think the first step is getting the rules out and seeing which states opt in. I would assume Missouri will. The hope is that this becomes something more people understand and take advantage of.

In Missouri, even though we have tons of tax credits that people do use, it takes a while to build it into tax preparation tools like TurboTax. So you kind of have to know what’s going on. Maybe once the federal piece is in place—and there are also changes to the child tax credit—that’ll help.

Susan Pendergrass (04:24)
Spread the word. How’s that changing?

Elias Tsapelas (04:51)
Some of the temporary provisions from the 2017 bill are now made permanent. One of the things the One Big Beautiful Bill does is take temporary changes and make them permanent. We’ll see in a few years how many of these stay.

Susan Pendergrass (05:10)
So the child tax credit is now permanent?

Elias Tsapelas (05:13)
Yes. The changes made in 2017 are now permanent. It’s higher now, and there’s more of it that’s refundable. There’s still an income threshold to get the maximum amount. I think there are going to be a lot of tax credit changes. The bill also got rid of a lot of renewable tax credits. So there are a lot of changes to tax policy for both businesses and individuals. I think people will need to start thinking about their Missouri taxes a little differently, at least for the next few years.

Susan Pendergrass (05:59)
Another piece is the savings accounts for children—kind of like IRAs for kids. I’ve read that anyone born after January 1, 2024, or maybe anyone currently under age 18, is eligible. The IRS has to open the accounts, and you need a Social Security number. For kids born between January 1, 2024, and 2026, the government deposits the first $1,000.

Elias Tsapelas (06:52)
Yeah. What I was trying to figure out is how these differ from 529 plans. I think these will be harder to withdraw from. They do come with tax benefits for employers and others contributing, but taxes will have to be paid when the money comes out.

Susan Pendergrass (07:25)
Yes—capital gains. With 529s, the money goes in pre-tax and comes out tax-free if used for education. These accounts are less flexible. You can take money out for education, a house, or a business, but otherwise there’s an early withdrawal penalty plus capital gains. It feels gimmicky, since the government only deposits $1,000 until 2028 when the program expires.

But for many low-income kids, this could be their only savings. It’s meant to help those who wouldn’t have a 529. They were originally going to be called “Invest in America Accounts,” but they’re now called “Trump Accounts.”

Elias Tsapelas (08:50)
I’m curious to see if the $1,000 is the only money ever deposited into these accounts for most people. It may not be worth putting in more, but even with tax obligations, it’s still free money.

Susan Pendergrass (09:27)
Right. You turn 18 and have $10,000—it’s not nothing. But some worry that a future Democratic president with control of Congress could expand the program—like depositing $500 annually for anyone under 18. It starts to look like a form of universal basic income. But I suspect it’ll go away—it feels gimmicky.

Elias Tsapelas (10:16)
I’m curious if the government will make it easier to use for college or similar expenses. There are a lot of higher education changes in the bill too. As someone with student loans, I’m getting emails every day about them.

Susan Pendergrass (10:33)
Yeah. So tell me—what are the changes to higher ed?

Elias Tsapelas (10:43)
Well…

Susan Pendergrass (10:46)
I’ve heard it might hurt community colleges, but I don’t know why. Do you?

Elias Tsapelas (10:49)
There are new caps on loan amounts and some income-based repayment plans are being eliminated. For example, the SAVE repayment plan created by the Biden administration has been tied up in court. Interest collection is resuming, but payments aren’t due yet. Borrowers need to switch plans, but the old ones are gone. The new plan tries to prevent negative amortization, but it’s still unclear how well that will work.

Grad students will be able to borrow less. The government wants loans repaid more quickly. After five years of paused payments, there’s a huge administrative burden now to unwind all of this.

Susan Pendergrass (12:11)
I know—since the pandemic.

Elias Tsapelas (12:17)
Exactly. There’s going to be a big process for certifying income and re-establishing payments. Colleges are nervous—lower borrowing limits could change students’ decisions. And I don’t know if the federal government is prepared to roll all of this out smoothly. I still need to re-set my auto-withdrawal.

Susan Pendergrass (12:56)
Yeah. It feels like we have to wait six months or a year to see what actually happens. Even the work requirements for SNAP and Medicaid were pushed out beyond the midterms. So while people are celebrating or panicking, a lot of this is still TBD.

Elias Tsapelas (13:26)
Yeah. And when people talk about “cuts,” especially to Medicaid, they’re mostly referring to ten-year projections. But a lot of the actual cuts are back-loaded. The benefits hit first—then the cuts. And some of those cuts may never happen. There’s also a big expansion of health savings accounts. People with bronze marketplace plans or direct primary care arrangements could use them, but rules still need to be written.

Susan Pendergrass (14:38)
I read there might be fewer subsidies, maybe higher premiums?

Elias Tsapelas (14:44)
Depends. There’s going to be a bill later this year to debate extending the enhanced COVID-era subsidies. But those subsidies created a kind of shadow market—shady dealers signing people up for plans they didn’t even know they had. About 2 million people were enrolled in multiple subsidized marketplace plans last year. So now there’s a push to reintroduce some “skin in the game.” But we’ll see what ends up mattering or going into effect.

Susan Pendergrass (16:04)
And our senator is already trying to undo parts of the bill he voted for.

Elias Tsapelas (16:08)
Yeah, especially the provider tax piece. That would help rein in spending, but the cuts don’t go into effect for several years—giving time for backtracking. If none of the pay-fors happen and only the expensive parts do, this bill just becomes even more costly.

Susan Pendergrass (17:08)
What does this bill, even optimistically, do to the federal deficit?

Elias Tsapelas (17:15)
I still need to see estimates, but we’re looking at adding at least $4 trillion to the deficit. Possibly more, depending on what’s made permanent.

Susan Pendergrass (17:53)
I thought Republicans cared about balanced budgets. This feels irresponsible. What do you think?

Elias Tsapelas (18:08)
It’s a lot easier to say you’re for fiscal responsibility than to actually do it. With Medicaid, people say cut waste—but cutting funding means cutting payments to hospitals, doctors, and nurses. And those tax cuts were always going to be extended. Every person taking the standard deduction is getting a bigger deduction. That costs money.

The real long-term budget problems are in Medicare, Medicaid, and Social Security—none of which were addressed. So someone will have to get back to those eventually.

Susan Pendergrass (19:48)
Yeah. Social Security’s trust fund is going to run dry soon—maybe within 10 years. The numbers are so big, it starts to feel imaginary. People can’t wrap their heads around what it would take to have a balanced budget. Both parties just keep giving stuff away, so you’d be foolish to sit on the sidelines.

Elias Tsapelas (20:24)
Yeah—it’s just different groups they’re giving to. This bill was very expensive. And I think future efforts will make it even more so by eliminating what little cost savings exist.

Susan Pendergrass (21:03)
The SALT deduction, for example—capped at $10,000 in 2017, now up to $40,000. That’s a $30,000 swing. For Californians, that’s huge.

Elias Tsapelas (21:27)
Yeah, and the benefit mostly goes to higher-income people. Even in Missouri, some homeowners might benefit—but it mostly helps the coasts. And it gives high-tax states more room to raise taxes, since the federal deduction cushions the blow.

Susan Pendergrass (22:19)
Exactly. Crazy stuff. Well, I think we’ve covered a lot. I won’t make you come back again, but there’s so much detail—it’s not really what either side thinks it is.

Elias Tsapelas (22:45)
I agree. Especially with Medicaid and SNAP. And states will carry a big burden implementing this. Some will do it well, some will fight every piece. There’s going to be a lot of news as this all rolls out.

Susan Pendergrass (23:46)
Totally. Not directly related, but recently I’ve met people surprised by the real ID requirement. It’s been around for 10–15 years, and Missouri resisted it. Some states just don’t want to jump into federal programs.

Elias Tsapelas (24:04)
Yeah—I’ve seen signs about it at TSA forever. Always “effective in 3 months,” then postponed. But it finally happened.

Susan Pendergrass (24:11)
Right. And this summer, people are finally getting real IDs. Missouri was one of the last to implement it. So I don’t expect the state to jump on many of these changes either. But there’s still plenty of time to talk about it all again.

Elias Tsapelas (24:28)
Yes.

Produced by Show-Me Opportunity

The post One Big Beautiful Bill Breakdown, Part II with Elias Tsapelas appeared first on Show-Me Institute.

Susan Pendergrass is joined by Elias Tsapelas, director of state budget and fiscal policy at the Show-Me Institute, to break down the sweeping new federal legislation known as the “One Big Beautiful Bill.” They discuss what it really means for Medicaid recipients, food stamp programs, state budgets, and Missouri taxpayers.

Listen on Spotify

Listen on Apple Podcasts 

Listen on SoundCloud

Timestamps

00:00 Understanding the One Big Beautiful Bill Act
06:44 Medicaid: Changes and Implications
11:23 SNAP Benefits: New Regulations and Effects
14:18 Tax Implications for Missourians
19:09 Future of Medicaid and State Budgets

Episode Transcript: Understanding the One Big Beautiful Bill with Elias Tsapelas (Download Here) 

Susan Pendergrass (00:00)
Okay, here we go. You ready? Elias Tsapelas, we are going to talk about IT—the big IT—the One Big Beautiful Bill Act. I don’t feel like I understand it. I suspect there’s a lot of people reading the news that don’t understand it, but you seem to understand a lot of it. So thanks for coming to talk to us about it today.

Elias Tsapelas (00:19)
No problem. I think there’s a lot of misconceptions, especially about what’s happening with the welfare programs in the bill. So I’m happy to dive into those.

Susan Pendergrass (00:27)
Yes, yeah. I’ve definitely seen claims that this is going to basically strip health care from millions and millions of people and that kids will be hungry. And I don’t want to minimize that. But we had Brian Blase on the podcast, and I thought I had an understanding of it that didn’t exactly line up with that narrative. So let’s just start there. People are saying that tens of millions of people are going to lose health insurance under the One Big Beautiful Bill Act. Explain that to me.

Elias Tsapelas (01:01)
Well, the first thing people need to understand about Medicaid is that it’s gotten tremendously more expensive in recent years. The Biden administration made a lot of changes during COVID—changes to how the program works and its future trajectory. Even after the One Big Beautiful Bill goes into effect, we’re basically just putting the program’s costs back on the trajectory it was on in 2021. This isn’t going back to the Stone Age—it’s more like going back five years.

A lot of this stems from efforts to eliminate waste, fraud, and abuse. And while there’s certainly some of that, what many people don’t realize is that most states, including Missouri, now contract with private health plans to cover people on Medicaid—particularly the Medicaid expansion population, which consists of healthy adults.

Susan Pendergrass (02:11)
Okay, so let’s just pretend we know nothing. Medicaid is a program that covers health insurance costs for low-income and disabled individuals?

Elias Tsapelas (02:24)
Yes. About 50% of kids in Missouri are on Medicaid. The program covers around two-thirds of all nursing home costs and over a third of all births in the state.

Susan Pendergrass (02:34)
So low-income pregnant women can get Medicaid coverage, and their children can as well. Who exactly is in the “expansion population”?

Elias Tsapelas (02:47)
Good question. And just to clarify—yes, Medicaid also covers a lot of very disabled individuals who private health insurance wouldn’t. But the expansion population refers to healthy adults making up to 138% of the federal poverty limit. These are not permanently disabled people. They’re generally able to work.

Before 2021, someone like me—unmarried and childless—couldn’t qualify for Medicaid in Missouri, even if I lost my job. Medicaid expansion changed that, and with it came a lot of problematic incentives. One issue is that states are paying health plans monthly for enrollees, but there isn’t always a process to verify whether those people are still eligible.

Susan Pendergrass (04:53)
Let me just stop you there. So the state is paying monthly premiums for people who might not even know they’re on Medicaid? And they might have a job now and no longer qualify, but the state hasn’t gone back to check?

Elias Tsapelas (05:40)
Exactly. Ideally, people would notify the government when they get a job, but most don’t, and the IT systems don’t really catch that. Previously, states just paid the bills as they came in. If someone didn’t go to the doctor, there was no cost. Now we’re paying premiums whether they use care or not, which adds up quickly.

Susan Pendergrass (06:40)
So what’s in the One Big Beautiful Bill? Are states required to recertify people?

Elias Tsapelas (06:45)
Yes. One big provision is that states must check eligibility at least twice per year. The Congressional Budget Office projects significant enrollment losses just from checking more often. That’s raised concerns about red tape, but the goal is to ensure people who are no longer eligible aren’t still receiving coverage.

Susan Pendergrass (07:13)
Can Missouri do that? Do we have the systems in place?

Elias Tsapelas (07:20)
I’d like to think so, but I’m not sure. During COVID, states weren’t allowed to check eligibility at all for over three years. Missouri spent an entire year catching up when that ended. Right now, about 1.2 million people are on Medicaid in Missouri, including 350,000 in the expansion group. So yes, it would mean more IT strain.

Another major part of the bill is requiring “community engagement” or work requirements for the able-bodied expansion group.

Susan Pendergrass (08:24)
So that’s people under 65 who aren’t disabled? How do they know who’s supposed to work?

Elias Tsapelas (08:32)
There are carve-outs—new moms, parents with kids under 14, people over 65, etc. The idea is to target people who could be in the workforce. There are also alternative ways to meet the requirements, like volunteering. And it’s worth noting: the SNAP program (food stamps) has had work requirements since the 1990s.

Susan Pendergrass (10:25)
Then why are people saying this will “kick people off”?

Elias Tsapelas (10:33)
Because people will have to meet work or volunteer requirements, and the state will recertify them more often. The question is: how many people will get caught in red tape? That depends on how well states implement the changes. Most of the bill’s provisions are phased in over time to allow states to adapt.

Susan Pendergrass (11:34)
Let’s talk about SNAP benefits. People are saying this will take food away from families. What’s actually changing?

Elias Tsapelas (11:46)
The federal government will now penalize states with high error rates in SNAP administration. Missouri’s overpayment error rate is about 10%, and some states are worse—Alaska’s is nearly 25%. Under the bill, if your error rate is over 6% for two years, the state will have to start covering some of the cost. So Missouri may have to pay a portion of benefits if it doesn’t improve.

Susan Pendergrass (14:06)
How does the bill impact taxes for Missourians?

Elias Tsapelas (14:14)
The standard deduction is going up—by $750 for single filers and up to $6,000 more for seniors. There’s also a new deduction for car loan interest and temporary exemptions for taxes on tips and overtime. Since Missouri’s tax code follows the federal code, that could mean less state revenue, too.

Susan Pendergrass (15:41)
So what will this cost Missouri?

Elias Tsapelas (15:46)
It depends. If we reduce our SNAP error rate, the cost isn’t too bad. But a bigger issue is the provider tax cap dropping from 6% to 3.5% over a few years. Missouri is at 4.2% now, so we’ll need to lower it. That tax generates about $1.5 billion per year for hospitals.

Susan Pendergrass (17:09)
How does the rural hospital fund come into play?

Elias Tsapelas (17:24)
The bill creates a $50 billion Rural Hospital Fund to be distributed over five years. States will get a portion based on how rural they are. The hope is this fund offsets the provider tax losses—at least through 2030. But after that, the fund ends. So there’s concern about what happens long-term.

Susan Pendergrass (19:18)
Senator Josh Hawley mentioned he supports the bill but hopes to fix the provider tax issue in five years.

Elias Tsapelas (19:29)
That seems to be the thinking—pass it now and revisit the unpopular parts later. A lot of the tax and spending changes are temporary, which is partly how they got the bill to comply with budget rules.

Susan Pendergrass (20:30)
This reflects what voters asked for—smaller government and more state responsibility. It reminds me of the Department of Education cuts. Missouri will have to decide which programs to keep and how to fund them. But I was surprised the expansion of the MOScholars tax credit program made it in.

Elias Tsapelas (22:35)
Yes, Medicaid will continue to dominate the state budget if we don’t address it. Every year it’s, “How much more is Medicaid going to cost?” Then we build the rest of the budget around that. This bill will force Missouri lawmakers to reevaluate some of those assumptions and perhaps reconsider whether managed care is working.

Susan Pendergrass (25:02)
That’s going to be interesting to watch. Thanks for breaking it down, Elias. This bill is being talked about a lot, but I think a lot of people are still unsure what it really does.

Elias Tsapelas (25:16)
No problem. I think we’re all looking forward to seeing what happens next.

Produced by Show-Me Opportunity

The post Understanding the One Big Beautiful Bill with Elias Tsapelas appeared first on Show-Me Institute.

On June 10, 2025, Patrick Tuohey, senior fellow at the Show-Me Institute, testified before the Missouri House Economic Development Committee during a special session focused on proposed stadium subsidies for the Kansas City Chiefs and Royals. In his testimony, Tuohey argued that the proposed funding package is based on a false sense of urgency, fueled by non-competitive offers from Kansas and a misleading June 30 deadline. He questioned the economic value of the proposed subsidies, highlighted concerns about taxpayer risk, and warned against allowing professional sports teams to play local governments against each other.

Read his submitted testimony here: https://bit.ly/4kXtdII

See the recording of the full hearing here: https://house.mo.gov/MediaCenter.aspx

The post Testimony of Patrick Tuohey Before the Missouri House Economic Development Committee June 10, 2025 appeared first on Show-Me Institute.

On June 10, 2025, David Stokes, director of municipal policy at the Show-Me Institute, testified before the Missouri House Economic Development Committee to express concerns about the property tax provisions included in a special session bill.

Stokes warned that the proposed property tax caps, added on the Senate floor without a public hearing, are constitutionally questionable, economically harmful, and likely to trigger long-term unintended consequences. He argued that freezing or severely limiting property taxes in certain counties will increase pressure on other revenue sources, such as sales taxes and state income taxes, and lead to greater use of tax districts like TDDs and CIDs. He also raised concerns about fairness and uniformity, noting that identical homes could be taxed at dramatically different rates simply based on how long someone has lived there.

Read his submitted testimony here: https://bit.ly/4kXtdII
See the recording of the full hearing here: https://house.mo.gov/MediaCenter.aspx

The post Testimony of David Stokes Before the Missouri House Economic Development Committee June 10, 2025 appeared first on Show-Me Institute.

Click here to read testimony on the Show-Me Sports Investment Act.

Click here to read testimony on Senate Bill 3 and property tax adjustments.

Watch Patrick Tuohey’s Testimony

Watch David Stokes’ Testimony

The post Testimony: The Show-Me Sports Investment Act and Senate Bill 3 on Property Tax Adjustments appeared first on Show-Me Institute.

In this episode, Susan Pendergrass speaks with Patrick Tuohey, senior fellow at the Show-Me Institute, about Missouri’s upcoming special legislative session, slated to begin on June 2, and the debate over taxpayer subsidies for stadiums. They discuss why stadium subsidies often fail to deliver promised economic benefits, how billionaire sports team owners leverage public funds for private gain, and the potential impact of a $50 million annual giveaway to the Kansas City Chiefs and Royals. Tuohey explains the flawed logic behind the argument that Missouri must compete with Kansas in a “race to the bottom” and argues that the state should instead focus on core services like public safety, education, and infrastructure. They also cover the broader implications of using taxpayer dollars to benefit wealthy team owners, the political dynamics driving these proposals, and what citizens and lawmakers should consider as the special session begins.

Listen on Spotify

Listen on Apple Podcasts 

Listen on SoundCloud

Download a Transcript of the Episode

Timestamps: 

00:00 Introduction to the Special Session
01:59 Stadium Subsidies: The Chiefs and Royals
05:35 Economic Impact of Stadium Subsidies
09:43 Political Dynamics of the Special Session
12:34 Public Sentiment and Legislative Challenges
16:29 Conclusion and Future Implications

Produced by Show-Me Opportunity

The post Missouri’s Special Session and Giveaways to Billionaires with Patrick Tuohey appeared first on Show-Me Institute.

The post Social Security, Tax Cuts, and the Future of Retirement with Andrew Biggs appeared first on Show-Me Institute.

In December 2024, in Springfield, Missouri, the Show-Me Institute and Show-Me Opportunity hosted an event featuring Dr. Aaron Hedlund, Chief Economist at the Show-Me Institute, and Elijah Haahr, former Missouri Speaker of the House and host of The Elijah Haahr Show on KWTO.

The discussion focused on the 2025 economic outlook for Missouri and the U.S., exploring issues such as unsustainable government spending, the growing national debt, and the Federal Reserve’s role in shaping inflation, housing, and labor markets.

This episode is a recording of that event.

Listen on Spotify

Listen on Apple Podcasts 

Listen on SoundCloud

Produced by Show-Me Opportunity

The post 2025 Economic Trends for the U.S. and Missouri with Aaron Hedlund and Elijah Haahr appeared first on Show-Me Institute.

In a UBI program, lower-income people are guaranteed an amount of money from the government. (In theory, that “guaranteed income” would apply to everyone, but so far most programs around the country have just been enacted for lower-income people.) UBI programs are different from the myriad other welfare programs in that there are generally no rules on how the money is spent and the requirements for admission into the program are easier. Compare this to food stamps and Section 8 housing vouchers, which obviously can only be spent on food and rent, respectively, and the general complexity of many other welfare programs.

Two studies have been released recently that actually tried to properly account for the success or failure of UBI programs in Denver, Texas, and Illinois. The results aren’t pretty. In Denver, the UBI program was focused on finding housing for the homeless. However, there was almost no difference in results between the groups that received significant sums of money and the control group that only received $50 per month. The control group did just as well at finding housing as the other two groups over the course of a year. While supporters of the program are trying to paint it as a success, the fact is that many homeless people eventually find housing, and the UBI payments made no difference in the results.

In Texas and Illinois, a UBI program gave some people $1,000 a month and a control group $50 per month. After the period of the program, the control group—who received less money—had a higher employment rate and were in better financial position:

The study, which began during the COVID-19 pandemic when unemployment was high, found that employment rates fell in the second and third years among recipients compared with the control group. On average, incomes rose significantly for all groups, though slightly higher for the control group. Incomes for recipients of the $1,000 rose from just under $30,000 to $45,710, while incomes for the control group started at a similar level but grew higher, to $50,970.

People responded to receiving free money by working less, which is exactly what you might expect. It’s also exactly the wrong way to help address poverty. The pilot program in St. Louis should be ended. The Missouri Constitution prohibits gifts to private individuals, and that is exactly what a UBI program is. But this would be a bad idea even aside from the legal issues. UBI programs just don’t work.

The post Universal Basic Income Programs Are Guaranteed Failures appeared first on Show-Me Institute.

James V. Shuls speaks with Russell S. Sobel, Professor of Economics and Entrepreneurship at the Baker School of Business at The Citadel, about his latest paper, “Why Markets Matter for Human Progress & Prosperity.” They discuss how free markets drive innovation, prosperity, and human flourishing, the historical context of market-based economies, the pitfalls of government intervention, the long-term benefits of entrepreneurship and competition, and more.

Read the full paper here.

Listen on Apple Podcasts 

Listen on SoundCloud

Produced by Show-Me Opportunity

The post Why Markets Matter for Human Progress with Russell Sobel appeared first on Show-Me Institute.

The post How Fast Should Government Grow with Elias Tsapelas appeared first on Show-Me Institute.

In this episode, Susan Pendergrass speaks with Ryan Bourne, the R. Evan Scharf Chair for the Public Understanding of Economics at the Cato Institute and editor of the book The War on Prices: How Popular Misconceptions about Inflation, Prices, and Value Create Bad Policy. They discuss the effects of price controls, recent interventions in the economy, how to remind people about free market principals, and more.

Ryan Bourne occupies the R. Evan Scharf Chair for the Public Understanding of Economics at Cato and is the author of the recent books Economics In One Virus, and The War on Prices. He has written on numerous economic issues, including fiscal policy, inequality, minimum wages, infrastructure spending, the cost of living and rent control.

Listen on Apple Podcasts 

Listen on SoundCloud

Produced by Show-Me Opportunity

The post The War on Prices with Ryan Bourne appeared first on Show-Me Institute.

– The stadium tax debate in Kansas City
– The MetroLink expansion plan advances in St. Louis
– How to make it easier to access virtual health care in Missouri, and more

Listen on Apple Podcasts 

Listen on SoundCloud

Produced by Show-Me Opportunity

The post KC Stadium Debate, MetroLink Expansion, and MO Loses the Top Spot appeared first on Show-Me Institute.

– Key takeaways from Governor Parson’s State of the State address
– Does Missouri have a budget surplus?
– A “source of income” ordinance passes in KC
– What’s moving in Jefferson City, and more

Listen on Apple Podcasts 

Listen on SoundCloud

LINKS:
Patrick Tuohey’s blog: showmeinstitute.org/blog/budget-and…budget-surplus/

David Stokes Testimony on Source of Income Rules: showmeinstitute.org/publication/mun…es-for-rentals/

Produced by Show-Me Opportunity

The post State of the State, Source of Income, and Triumphant Returns appeared first on Show-Me Institute.

The post Beyond Reagan and Thatcher: The Future of Supply Side Economics appeared first on Show-Me Institute.