The Affordable Care Act is government paying for your private insurance when your employer doesn’t: If you or your family aren’t getting health insurance through your job, the government will pay to get you private insurance coverage, just as an employer would. You’ll have to contribute something—but the law guarantees, with specific numbers, that it will be no more than you can afford. It’ll be less than three percent of your paycheck if your family makes $33,000 a year, less than ten percent if you make as much as $88,000. Pre-existing conditions won’t matter. The government will still pay for your insurance, with the same affordable contribution from you.
The bill has lots more--things that make it even better. But that, it seems to me, is the basic idea.... Under ACA, it’s the government’s job to get you insurance, and to pay for almost all of it if you can’t afford it. Before, you were on your own.
Paul Krugman will be pleased, not distressed, by further widening of the U.S. term structure:
A Note On The Term Spread: [T]o a first approximation you can think of the long term rate as reflecting an average of expected future short-term rates. Short-term rates, in turn, tend to reflect the state of the economy: if the economy improves, the Fed will raise short-term rates.... If the economy improves, short rates will rise; but if it worsens, well, they’re already zero, so there’s nowhere to go but up. This implies that there has to be a positive term spread. Now, this spread could be fairly small if people expected the economy to remain in the dumps for a long time; see Japan. What the large spread now tells us is that the US economy is in the dumps now, but that investors see a reasonably good chance of a strong recovery in the not-too-distant future. That’s good news, not bad news....
[I]f investors were growing worried about US ability to honor its debts, they would be worrying about a breakout of inflation as well as or instead of default per se. But we can track that by comparing interest rates on ordinary bonds and inflation-protected bonds. What we see is that from 3/17 to 3/30 — the period that inspired all those recent scare stories — the nominal interest rate on 10-year bonds rose by 26 basis points; the real rate rose by 28 basis points. So expected inflation actually declined, marginally. This is not at all what you’d expect to see if markets were pricing in fears about the US ability to repay. It is, on the other hand, exactly what you’d expect to see if markets slightly upgraded their hopes of recovery.... [A]ll that huge spread is telling us is that we’re up against the zero lower bound, but that markets think we may not stay there.
Once again, the two rules:
Not that I don't understand why she doesn't--I don't read the WSJ editorial page either except under duress.
But isn't reading the WSJ editorial page part of her job?
Excessive Outrage on Retiree Subsidy Accounting: [T]he new health care plan changed the tax treatment of a subsidy for retiree prescription drug benefits, which caused those companies who had received the subsidy to announce a charge against their deferred tax assets. Conservatives gleefully pointed out that this was probably going to change peoples' drug benefits. Liberals leaped into the fray, arguing that all the law had done was 'closed a loophole", and accusing the companies of "double dipping". All this moralizing seems to me to be extremely overwrought. (To be fair, I haven't actually seen any of the conservative moralizing; only liberal blogs claiming it exists. Which is not to say that it doesn't, only that I don't read the frothier bits of the conservative blogosphere or media world where such moralizing might have been done...
I do like the description of the WSJ editorial page as one of the "frothier bits of the conservative blogosphere or media world" however: dead-on!
What is going on:
The Republican Bush administration's 2003 Medicare Part D established both a subsidy and a deduction for retiree health benefits:
Thus the government is (for a 35% bracket corporation) kicking in $63 and shareholders are kicking in $37 of every $100 spent on retiree health benefits.
The "normal" way to do this would be to have simply a subsidy:
And thus the "normal" way the $28 subsidy would mean that the government is kicking in $53.20 and shareholders are kicking in $46.80 of every $100 spent on retiree health benefits.
This tax treatment is, to my knowledge, unique--I have never seen it before: the HIRE Tax Credit, the Research & Experimentation credit, and everything else I can think of all allows businesses to deduct only the net cost of the credit on their tax forms.
And the 2010 PPACA brings the tax treatment of this subsidy back into line with normal procedure.
Why did the Bush administration and the Republicans in 2003 do it this way? It smells like some last-minute lobbyist-induced slipping of the provision into the bill. It makes it a 40% subsidy, but the bill's managers can truthfully tell congressmen they are trying to get to vote for the thing that it is not a 40% but a 28% subsidy--and hope that they don't ask whether there is anything hinky about the tax treatment. It looks to me like just one of the hinky things done by the Republican Party in what was the hinkyest vote taken in the U.S. Congress ever:
Medicare Prescription Drug, Improvement, and Modernization Act (Part D): Legislative History: The bill was introduced in the House of Representatives early on June 25, 2003 as H.R. 1, sponsored by Speaker Dennis Hastert. All that day and the next the bill was debated, and it was apparent that the bill would be very divisive. In the early morning of June 27, a floor vote was taken. After the initial electronic vote, the count stood at 214 yeas, 218 nays. Three Republican representatives then changed their votes. One opponent of the bill, Ernest J. Istook, Jr. (R-OK-5), changed his vote to "present" upon being told that C.W. Bill Young (R-FL-10), who was absent due to a death in the family, would have voted "aye" if he had been present. Next, Republicans Butch Otter (ID-1) and Jo Ann Emerson (MO-8) switched their vote to "aye" under pressure from the party leadership. The bill passed by one vote, 216-215. On June 26, the Senate passed its version of the bill, 76-21. The bills were unified in conference, and on November 21, the bill came back to the House for approval.
The bill came to a vote at 3 a.m. on November 22. After 45 minutes, the bill was losing, 219-215, with David Wu (D-OR-1) not voting. Speaker Dennis Hastert and Majority Leader Tom DeLay sought to convince some of dissenting Republicans to switch their votes, as they had in June. Istook, who had always been a wavering vote, consented quickly, producing a 218-216 tally. In a highly unusual move, the House leadership held the vote open for hours as they sought two more votes. Then-Representative Nick Smith (R-MI) claimed he was offered campaign funds for his son, who was running to replace him, in return for a change in his vote from "nay" to "yea." After controversy ensued, Smith clarified no explicit offer of campaign funds was made, but that that he was offered "substantial and aggressive campaign support" which he had assumed included financial support. About 5:50 a.m. the leadership convinced Otter and Trent Franks (AZ-2) to switch their votes...
Votes are supposed to be closed after fifteen minutes.
Good for the Democrats in undoing this.
From Paul Krugman:
If you are a Republican, you think a low-tax country is the right place to live, right? And now if you read Greg Mankiw he proves that North Korea is the lowest tax country.
South Korean police have been trying to keep Republican lobbyists from trying to cross the border minefields without success all morning. In other news, Coast Guard vessels with bullhorns have been trying to stop Republican entrepreneurs from embarking for Cuba from Key West in small rubber boats...
Greg Mankiw's Blog: Taxes per Person: Some pundits, reflecting on the looming U.S. budget deficits, claim that Americans are vastly undertaxed compared with other major nations. I was wondering, to what extent is that true? The most common metric for answering this question is taxes as a percentage of GDP. However, high tax rates tend to depress GDP. Looking at taxes as a percentage of GDP may mislead us into thinking we can increase tax revenue more than we actually can. For some purposes, a better statistic may be taxes per person, which we can compute using this piece of advanced mathematics:
Taxes/GDP x GDP/Person = Taxes/Person
Here are the results for some of the largest developed nations:
France: .461 x 33,744 = 15,556. Germany: .406 x 34,219 = 13,893. UK: .390 x 35,165 = 13,714> US: .282 x 46,443 = 13,097. Canada: .334 x 38,290 = 12,789. Italy: .426 x 29,290 = 12,478. Spain: .373 x 29,527 = 11,014. Japan: .274 x 32,817 = 8,992
The bottom line: The United States is indeed a low-tax country as judged by taxes as a percentage of GDP, but as judged by taxes per person, the United States is in the middle of the pack.
Macroeconomic Advisers emails:
Private nonfarm payroll employment declined by 23,000 from February to March on a seasonally adjusted basis, according to the ADP National Employment Report™. This is somewhat below consensus expectations for this figure of a 40,000 increase.
The term premium on U.S. Treasury debt is low because even though long-term nominal (and real) rates are low, short-term rates are even lower, for we are deep in recession with an enormous fight-to-safety still going on in financial markets populated by spooked investors.
Megan McArdle disagrees, but it is not clear why:
Why is the Term Risk on Long Term US Debt So High?: Perhaps people are worried about future inflation--but while the spread between inflation-indexed bond prices and regular treasuries is rising, it's still rather low. It's also possible that people are simply anticipating that eventually, a treasury bubble driven by the global "flight to quality" will dissipate, making it harder to unload longer-maturity debt. There's currency risk, too, especially since many of our creditors are foreigners. And of course, there's the dreaded default risk. If people stop thinking we're good for the money, they will demand higher interest rates, and tip us into crisis.
It's impossible to say which prevails, but it's not unreasonable to assume that there's at least some default risk pricing in. Our entitlement problem is about to open a gaping hole in the budget, and so far our solution is... to enact more entitlements. Unless our politicians start outlining some credible plans for getting our demography-driven disaster under control, bond markets would be perfectly rational to demand a discount that reflects a possible future fiscal crisis...
When investors start to fear an increasing chance of default because the government's finances don't make any sense and to price that default into bond yields, it looks like this--for Latvia:
That is not repeat NOT REPEAT NOT!! what we see in the U.S. Not at all. We have $3 trillion more of U.S. government debt held by the public than we did two years ago--and lower long-term interest rates.
The thesis that market economies would be worth having for their own sake, even if they were inefficient at production and distribution, is held by Tyler Cowen:
Who is a first-best economist?: I think of myself as a better-than-first-best economist. On average market solutions have positive Pareto-relevant externalities, if only through supplying experimentation and strengthening social norms in favor of commerce. That's true even for the market in thumbtacks, if you consider it as feeding into a broader social stream.... But I don't mean this as a plea for laissez-faire. Governments must produce public goods, maintain social order, and of course support markets. At the margin, those activities, such as imposing accountability under the law, are also largely underprovided.... An oversimplified version of my view is that anything good is underprovided at the margin. This follows from a belief in strong network and peer effects, and a belief in the relevance of basic sociology...
The basic logic is that if the bulk of your social interactions are win-win acts of voluntary mutually-beneficial exchange, you are likely to think that you live in a happy benevolent peaceful world and are less likely to go Mad Max on your fellows.
In his The Passions and the Interests and in his Rival Views of Market Society, Albert Hirschman names this the "doux commerce" thesis--and sees it as a "powerful moralizing agent which brings many nonmaterial improvements to society, even though a bit of hypocrisy may have to be accepted into the bargain." As Hirschman quotes Samuel Ricard:
Commerce attaches [people] one to another through mutual utility. Through commerce the moral and physical passions are superseded by interest.... Commerce has a special character which distinguishes it from all other professions. It affects the feelings of men so strongly that it makes him who was proud and haughty suddenly turn supple, bending and serviceable. Through commerce, man learns to deliberate, to be honest, to acquire manners, to be prudent and reserved in both talk and action. Sensing the necessity to be wise and honest in order to succeed, he flees vice, or at least his demeanor exhibits decency and seriousness so as not to arouse any adverse judgement on the part of present and future acquaintances; he would not dare make a spectacle of himself for fear of damaging his credit standing, and thus society may well avoid a scandal which it might otherwise have to deplore...
Hirschman, The Passions and the Interests:
There was much talk, from the late seventeenth century on, about the douceur of commerce... sweetness, softness, calm, and gentleness... the antonym of violence. The first mention of this qualification I have been able to find occurs in Jacques Savary's Le Parfait Negociant, the seventeenth-century textbook for businessmen.... The most influential exponent of the doctrine of the doux commerce was Montesquieu...
Adam Smith, Lectures on Jurisprudence:
A dealer is afraid of losing his character, and is scrupulous in observing every engagement. When a person makes perhaps 20 contracts in a day, he cannot gain so much by endeavouring to impose on his neighbours, as the very appearance of a cheat would make him lose. Where people seldom deal with one another, we find that they are somewhat disposed to cheat, because they can gain more by a smart trick than they can lose by the injury which it does their character...
But even Smith's self-interested and calculating market agents are sociable ones: they exchange, and perhaps they cheat--they don't kill, rape, burn, and steal. Which is odd, given that fifty years before Smith was born not far from his house there were lots of people who saw others not as potential partners in acts of mutually-beneficial commerce but instead as either (i) clan allies, (ii) clan enemies to be killed, or (iii) strangers to be robbed.
Romney Death Watch: Republicans believe that the Affordable Care Act is socialist tyranny. Romney's position is basically that socialist tyranny is okay as long as it's imposed on a state-by-state basis. I don't see this argument winning over the GOP base. This is why I've been skeptical for a while now about Romney's 2012 prospects. The Atlantic Monthly's Marc Ambinder takes issue.... Ambinder has this backwards. Right now, Romney looks fine -- he has money, name recognition, decent polling, and the like.... Republican leaders... trying to demonize the Affordable Care Act... have little incentive to point out that it's basically Romneycare plus cost controls. But in... 2012... lots of Republicans [will be] playing up the comparisons between Romneycare and Obamacare. Romney appears political viable right now because most Republican voters have not been exposed to the Romneycare-Obamacare comparison.... When the attacks come, Romney just has no convincing reply. Indeed, you're going to see more quotes like this, from the economist who helped devise the basis of both programs:
“Basically, it’s the same thing,’’ said Jonathan Gruber, an MIT economist who advised the Romney and Obama administrations on their health insurance programs. A national health overhaul would not have happened if Mitt Romney had not made “the decision in 2005 to go for it. He is in many ways the intellectual father of national health reform.’’
This is going to be the basis for a devastating attack, and I don't see how Romney answers it. I'd like to see Romney win the nomination, because he's intelligent, competent, and has some decent moral instincts buried somewhere beneath a thick coat of pandering demagoguery. I just don't see it happening.
Indeed, IMHO there was one and only one way that Romney had a chance to win the Republican nomination in 2012, an that was to start running in 2009 as the moderate in the hope (i) that everyone else would go after the wingnut vote and cancel each other out in the early primaries, and (ii) that once he is the front-runner the natural Republican tendency to give your primary vote to last time's runner-up dominates.
But that would have required that Romney stand up on his hind legs and be a man last October and say what he really believes--that RomneyCare is a pretty good health plan, that the problem with ObamaCare is that its funding is a bit too progressive, and that the Congressional Republicans are making a big mistake in not offering Obama 70-30 Senate passage with 20 Republicans on board in return for moving the bill to the right.
But Romney did not tack to the left and say what he believed back last October. So now I would be very surprised if he has any future at all in American politics. The press narrative of him as a soulless pandering zombie will in all likelihood be impossible to overcome is set--and justly so.
Was this part of the "Stupidest Man Alive" series or of the "Republican War on Science" series or of the "American Enterprise Institute Quality Research" series? Silly question! It was part of all three. It was when Kevin Hassett called for the USAF to attack France and Switzerland to stop CERN's Large Hadron Collider from going into action.
Business Week should still hide itself from the sun in shame:
American Enterprise Institute "Economist" of Mass Destruction Kevin Hassett Strikes Again (Republican War on Science Department): Atom Smasher Exposes Hole in Earth’s Defenses: The Large Hadron Collider... consumes about the same amount of energy as a large city... could provide evidence of the existence of the Higgs boson, a hypothesized particle that has become known as the God particle.... [T]he collider’s energy could induce a catastrophic event. A brilliant review of the risks associated with the experiment by University of North Dakota law professor Eric Johnson.... LHC’s high-energy collisions might create a microscopic black hole that would, perhaps over a few years, swallow the Earth.... Oxford University’s Toby Ord, a philosopher by training, adds... [i]t may be that the models that we use to make predictions about the possibility of catastrophe are themselves flawed.... Ord estimates that the odds of the LHC producing a disaster are between one in 1,000 and one in 1 million... the likely benefits from this experiment... [cannot]... justify accepting a cost that includes a real risk of the Earth’s destruction.... Right now... [if] the U.S. wanted to stop the LHC experiment, it would have no recourse short of military action...
This did indeed carry the Republican War on Science to previously unplumbed depths of human stupidity. Let me just say that, IIRC, Leon Lederman named the hypothesized Higgs boson the "God particle" as a joke, because its effects were everywhere yet nobody had ever seen it in the flesh--not because it was in any way powerful or dangerous or numinous or terrifying.
Worth revisiting because of Roger Ebert, who tweets:
Twitter / Roger Ebert: Headline: Large Hadron Col ...: Headline: Large Hadron Collider test carried out. Subhead: Earth [still] here.
And there is an LHC webcam!
Via Matthew Yglesias, Jennifer Rubin of Commentary blogs that Passover is not about social justice but about the right to build settlements on the West Bank:
Passover Mush: Obama... released a Passover message... typical Obama--off-key, hyper-political, and condescending. The core of the message is this: "The enduring story of the Exodus teaches us that, wherever we live, there is oppression to be fought and freedom to be won. In retelling this story from generation to generation, we are reminded of our ongoing responsibility to fight against all forms of suffering and discrimination, and we reaffirm the ties that bind us all..." No, he didn’t have the nerve to recite the emphatic exhortation “Next year in Jerusalem.” And frankly, it sounds like Eric Holder and his civil rights lawyers drafted it. Is Passover really about discrimination? Or is it about the deliverance of God’s Chosen People by God from bondage to the land of Israel?...
The ONE WHO WAS, AND IS, AND IS YET TO COME blogs... somewhat differently:
Deuteronomy 15:7: If there be among you a poor man of one of thy brethren within any of thy gates in thy land which the LORD thy God giveth thee, thou shalt not harden thine heart, nor shut thine hand from thy poor brother: But thou shalt open thine hand wide unto him, and shalt surely lend him sufficient for his need, in that which he wanteth. Beware that there be not a thought in thy wicked heart, saying, The seventh year, the year of release, is at hand; and thine eye be evil against thy poor brother, and thou givest him nought; and he cry unto the LORD against thee, and it be sin unto thee. Thou shalt surely give him, and thine heart shall not be grieved when thou givest unto him: because that for this thing the LORD thy God shall bless thee in all thy works, and in all that thou puttest thine hand unto. For the poor shall never cease out of the land: therefore I command thee, saying, Thou shalt open thine hand wide unto thy brother, to thy poor, and to thy needy, in thy land. And if thy brother, an Hebrew man, or an Hebrew woman, be sold unto thee, and serve thee six years; then in the seventh year thou shalt let him go free from thee. And when thou sendest him out free from thee, thou shalt not let him go away empty: Thou shalt furnish him liberally out of thy flock, and out of thy floor, and out of thy winepress: of that wherewith the LORD thy God hath blessed thee thou shalt give unto him. And thou shalt remember that thou wast a bondman in the land of Egypt, and the LORD thy God redeemed thee: therefore I command thee this thing to day...
Deuteronomy 24:6: No man shall take the nether or the upper millstone to pledge: for he taketh a man's life to pledge. If a man be found stealing any of his brethren of the children of Israel, and maketh merchandise of him, or selleth him; then that thief shall die; and thou shalt put evil away from among you. Take heed in the plague of leprosy, that thou observe diligently, and do according to all that the priests the Levites shall teach you: as I commanded them, so ye shall observe to do. Remember what the LORD thy God did unto Miriam by the way, after that ye were come forth out of Egypt. When thou dost lend thy brother any thing, thou shalt not go into his house to fetch his pledge. Thou shalt stand abroad, and the man to whom thou dost lend shall bring out the pledge abroad unto thee. And if the man be poor, thou shalt not sleep with his pledge: In any case thou shalt deliver him the pledge again when the sun goeth down, that he may sleep in his own raiment, and bless thee: and it shall be righteousness unto thee before the LORD thy God. Thou shalt not oppress an hired servant that is poor and needy, whether he be of thy brethren, or of thy strangers that are in thy land within thy gates: At his day thou shalt give him his hire, neither shall the sun go down upon it; for he is poor, and setteth his heart upon it: lest he cry against thee unto the LORD, and it be sin unto thee. The fathers shall not be put to death for the children, neither shall the children be put to death for the fathers: every man shall be put to death for his own sin. Thou shalt not pervert the judgment of the stranger, nor of the fatherless; nor take a widow's raiment to pledge: But thou shalt remember that thou wast a bondman in Egypt, and the LORD thy God redeemed thee thence: therefore I command thee to do this thing...
Deuteronomy 24:19: When thou cuttest down thine harvest in thy field, and hast forgot a sheaf in the field, thou shalt not go again to fetch it: it shall be for the stranger, for the fatherless, and for the widow: that the LORD thy God may bless thee in all the work of thine hands. When thou beatest thine olive tree, thou shalt not go over the boughs again: it shall be for the stranger, for the fatherless, and for the widow. When thou gatherest the grapes of thy vineyard, thou shalt not glean it afterward: it shall be for the stranger, for the fatherless, and for the widow. And thou shalt remember that thou wast a bondman in the land of Egypt: therefore I command thee to do this thing...
Second Congress, Session I:
- Be it enacted by the Senate and House of Representatives of the United States of America, in Congress assembled, That each and every free able-bodied white male citizen of the respective States, resident therein, who is or shall be of age of eighteen years, and under the age of forty-five years (except as is herein after excepted) shall severally and respectively be enrolled in the militia.... That every citizen, so enrolled and notified, shall, within six months thereafter, provide himself with a good musket or firelock, a sufficient bayonet and belt, two spare flints, and a knapsack, a pouch, with a box therein, to contain not less than twenty four cartridges, suited to the bore of his musket or firelock, each cartridge to contain a proper quantity of powder and ball; or with a good rifle, knapsack, shot-pouch, and powder-horn, twenty balls suited to the bore of his rifle, and a quarter of a pound of powder; and shall appear so armed, accoutred and provided, when called out to exercise or into service...
Randy Barnett, Carmack Waterhouse "Professor" of Legal Theory:
Is the Health Care Law Unconstitutional?: Exceeding Congress’s Authority: The smart money is always on the Supreme Court upholding an act of Congress. And the smart money is right until the day it is wrong — as when constitutional law professors confidently predicted the court would uphold the Gun Free School Zones Act in 1995 and the Violence Against Women Act in 2000. The professoriate was shocked when both laws were held unconstitutional because they exceeded Congress’s power under the Commerce Clause.... The individual mandate goes far beyond these previous acts. Congress has never before mandated that a citizen enter into an economic transaction with a private company, so there can be no judicial precedent for such a law. Telling someone how they must do something is one thing; commanding that they must do something is entirely different. Imagine if Congress ordered the majority of American households without a firearm to buy a handgun from a private company, and punished their failure to do so with an escalating monetary fine, which it labeled a “tax.” Would the supporters of the health insurance mandate feel the same about the constitutionality of such a measure?.... Does the text of the Constitution authorize this exercise of power? No, it doesn’t. Has the Court ever before upheld this claim of power? No, it hasn’t. Can the challengers get this mandate invalidated? Yes, they can.
Monday, March 29, 2010
SUSIE GHARIB: With historic health care reforms now the law, tonight's commentator says the long debate was pure politics. He's Brad Delong, professor of economics at the University of California Berkeley.
BRAD DELONG, ECONOMICS PROF., UNIV. OF CALIFORNIA BERKELEY: Last week, President Obama signed health care reform -- the patient protection and affordable care act -- the biggest change in how our health care financing system works since the establishment of Medicare and Medicaid in the 1960s. When the provisions of this new law are fully phased in, individuals and small businesses will no longer have to bargain with HMOs and health insurance companies from positions of weakness relative to big firms and their employees. Everybody will be able to use the equivalent of a big firm's benefit department to do their bargaining for them. People who switch jobs will no longer have to worry they won't be able to get or afford coverage in their new job. And people will no longer have to worry about being dropped by their insurance companies either because they are sick and so expensive to cover or because somebody made a mistake on a form 10 years ago. Why then, is there so much political excitement and division? Aren't these things pretty much everyone can agree on? The answer is yes, they are things pretty much everyone can agree on. In fact one of Republican presidential hopeful Tim Pawlenty's strategists told the "Atlantic Monthly's" Marc Ambinder last week that Obamacare is Romneycare, that Obamacare is in its essence the plan Republican Mitt Romney proposed back in 2004 and persuaded the Massachusetts state legislature to pass in 2006. Why then, is everybody so excited and divided? Because the people making the excitement and division are politicians -- and politicians hope that there are votes in the issue for them somewhere. I'm Brad Delong.
A question Sydelle Moore asks me this morning.
Quite possibly yes--although it does depend on what "possible" means. In my view, Steele is likely to be a better leader for the Republican National Committee than anybody else who might win the job.
To understand the Republican Party today, you have to recognize that right now it is bespelled by three curses:
The curse of Ronald Reagan: it believes that over the long haul somehow America can tax like Calvin Coolidge and spend like Lyndon Johnson and everything will come out fine because it is morning in America.
The curse of Richard Nixon: it believes that the purpose of politics is to win high-paid jobs with no heavy lifting involved and to humiliate your political adversaries, rather than to make a better country and a better world, and so anything goes.
The curse of Barry Goldwater: it believes that the big threat to liberty comes from government attempts to enhance equality of opportunity, and so the Republican Party must abandon its historic commitment to equality of opportunity.
The Republican Party may never again have a legitimate place in American civil life. But if it does, it will only be because brave men and women working within it lift these three curses.
Given his career and his life experience, Michael Steele is more likely to be a positive curse-lifting force than anybody else I can think of who might win his job.
Ah. I see that George Mason's History News Network http://hnn.us/ is eager to climb into bed with Lew Rockwell http://hnn.us/blogs/entries/124678.html--somebody who has no place in American academic or political discourse:
Here is Ron Paul acolyte John Robbins to explain why:
Open Letter To Lew Rockwell: You have now had three opportunities –1996, 2001, and 2008 — to prove that you are a friend of Ron Paul and freedom, and you have failed to do so each time. This week, for the third time, the puerile, racist, and completely un-Pauline comments that all informed people say you have caused to appear in Ron’s newsletters over the course of several years have become an issue in his campaign. This time the stakes are even higher than before. He is seeking nationwide office, the Republican nomination for President, and his campaign is attracting millions of supporters, not tens of thousands. Three times you have failed to come forward and admit responsibility for and complicity in the scandals. You have allowed Ron to twist slowly in the wind. Because of your silence, Ron has been forced to issue repeated statements of denial, to answer repeated questions in multiple interviews, and to be embarrassed on national television. Your callous disregard for both Ron and his millions of supporters is unconscionable.
If you were Dr. Paul’s friend, or a friend of freedom, as you pretend to be, by now you would have stepped forward, assumed responsibility for those asinine and harmful comments, resigned from any connection to Ron or his campaign, and relieved Ron of the burden of having to repeatedly deny the charges of racism. But you have not done so, and so the scandal continues to detract from Ron’s message. You know as well as I do that Ron does not have a racist bone in his body, yet those racist remarks went out under his name, not yours. Pretty clever. But now it’s time to man up, Lew. Admit your role, and exonerate Ron. You should have done it years ago.
John Robbins, Ph.D. Chief of Staff, Dr. Ron Paul, 1981-1985
Seriously: Just as William F. Buckley decided that it would be a bad mistake for National Review to stay in bed with the John Birch Society or the Ku Klux Klan, Dan Cohen of HNN is making a really bad mistake by allowing C.J. Maloney to post at all, and thus by failing to exercise any quality control here...
One Little Bar Tab Should Put Michael Steele at Risk: “Take us to the hottest nightclub in town.” Those were the instructions given to Orange County’s Erik Brown by RNC staffers and in L.A., that’s one heavy-duty request. On Grammy weekend, it’s an even taller order, one which led to the now-infamous night at Voyeur in February, 2009 which was first reported on by the Daily Caller yesterday. After a follow-up Red County post reported exclusively on some of the details missing from that original DC piece, for the rest of the day I found myself in contact with a number of that night’s key attendees, some of whom I know personally. After speaking with multiple sources I understand how the whole night went down but for the sake of putting the focus back where it belongs—the RNC—in my opinion there is only one moment from that night that matters.
Those charges ended up on Brown’s card for just one reason: because the RNC staffer’s credit card was declined at the end of the night.
Think about that for a second: you now know Brown’s name, and his business has been literally decimated (more on that in a minute), because he happened to be nearby when the bill came due. “Please help me out and I’ll be sure you are reimbursed right away by the RNC,” was the request--one most others in Brown’s spot would have answered--and there exists a follow-up email chain to prove it. And it’s a good thing for him that there is such an email exchange because if not, the RNC might still be demanding that it be reimbursed for those charges, as it thundered in its first reply yesterday morning.
Now think about that one for even more than a second, because it represents the type of thing people hate about politicians in general: CYA and throw underlings to the wolves to protect the boss at all costs. In this case, the first “underling” to be thrown under the bus was going to be an activist and donor, one who had merely gone to the trouble not only of contributing substantially to Republican causes himself, but of recruiting numerous other potential members of the RNC’s “Young Eagles” donor wing. But what’s one little donor thrown to the wolves when you’re protecting the Chairman of the RNC, right? If you’ll notice, though, as the RNC realized it was pinned down by facts, the committee’s narrative evolved throughout the day: first, it was demanding to be reimbursed. Later, it had a “commitment that the money would be returned,” with the returnee unspecified. Only very late in the day—after 9pm EDT—did the RNC finally issue an updated statement which finally gave some color to what I’ve written about above. It included the following:
It is unfortunate that a loyal GOP donor who has recruited other donors became involved in this incident while merely trying to help what turned out to be the improper request of a staffer who is no longer with the committee.
Erik Brown must be thinking, ‘Gee, thanks.’ So, too, must the staffer who ended up getting axed last night after RNC brass figured out Brown’s head couldn’t be cut off (a fact they had to be convinced of, reportedly, partly with that email string I referenced earlier). Now, I have no problem with that staffer firing; by all accounts, she was a nice enough person (I’m not including her name here so as not to further damage her new job hunt) but if a house cleaning is in order at the RNC, fine. Question is: how high up should that housecleaning reach? Obviously, a free-spending culture under Michael Steele has been the norm, as this staffer had no qualms about running this ridiculous charge through the committee. But get beyond the excitement of this nightclub story and re-read those articles, taking a close look at the dollars being spent by the RNC; on the surface, those charges seem simply stunning. At a minimum, they call for deep scrutiny....
For Erik Brown, he has his own troubles now. I mentioned earlier this upheaval he’s already feeling in his business; indeed, he’s been on the receiving end of releases like these from campaigns who used to make use of his company's printing services:
This is a quick note to let you know that (campaign’s name redacted) has severed all ties with Erik Brown's Dynamic Marketing, Inc (DMI). This is relevant news in light of recent revelations in the media. The history of the campaign's engagement with DMI is brief and straightforward: we had them print some campaign letterhead, trifold signs, and stickers. That engagement ended some weeks ago when we contracted with a different printer, and will not resume. This is a non-story in itself, but as (redacted) is being noted in some media outlets as a Brown client, it's important to provide proper context for the relationship, and to publicly state that there is no present relationship with DMI....
But let me be clear here: I’m not suggesting readers shed a tear for Brown. Some folks will conclude that anyone who was there that night is automatically damned straight to Hell--fine. Most others won’t be too upset to learn that not only has he been getting bombarded with media calls, but Erik Brown is already receiving hate mail from unknowns, people torching him with in-depth messages about what a depraved and awful person he is. Those most charitable might think, ‘man, what an awful break,’ which it also was, undoubtedly. But still, the situation is partly of his own making; he attended, partied, and now has work to do cleaning up the mess. But should Brown suffer the worst fallout from all of this? Should his business be put literally in jeopardy over this nightclub outing--an evening, by the way, which counted two RNC national committeemen in attendance at Voyeur--while Michael Steele skates yet again? Until now, I’ve had virtually no opinion on the ongoing internal GOP debate over Steele’s leadership of the RNC, but I’ve gone from 0-60 on that one...
Young Eagles Director Fired Over Voyeur Scandal; Erik Brown’s Name Is Cleared: Reid Wilson breaks the news:
Allison Meyers, director of the RNC’s “Young Eagles” program, was terminated yesterday after reports that the RNC reimbursed a donor for a nearly $2K expense at the Voyeur nightclub in West Hollywood. A CA GOP consultant, Erik Brown, was reimbursed for the expense after a Young Eagles event in Beverly Hills. A CA blog reported that an RNC staffer’s credit card was declined at the club, so Brown grudgingly put the expense on his own card.
That’s 180 degrees away from what many people thought yesterday — that Brown had acted overzealously, that the reimbursement was for a night he planned, and that the RNC had slipped up in cutting the check. Now Brown, whose reputation was dragged through the mud for a day, looks like the victim of a media frenzy. Today, Republicans are making sure that everyone knows Brown was caught up in something he did not plan — his mistake was asking for the reimbursement, apparently convinced that it would be fine with the RNC, since it was Meyers’ idea. That’s still going to deliver a hit to Brown’s reputation. What happens next at the RNC? The Young Eagles are, naturally, a bit more on-the-edge when it comes to fundraising events — they’re the group planning the upcoming event on Xe’s property — but I am told that the RNC will introduce some new ground rules about what can and cannot bought and rented with an RNC credit card, or under the RNC’s auspices.
George Stigler wrote somewhere that the purpose of economic growth is to make us not think of necessities, to turn what were once extravagant luxuries into necessities, and to allow us to invent new luxuries to aspire to.
Watching the Black Eyed Peas has now made me bitterly regret that I am so poor that I will never ride an elephant across one of the moons of Jupiter. Am I made poorer thereby?
I bow before my master:
Grasping Reality With Our Gelatinous Meatsacks: Will Wilkinson is a little snarky about it, but basically right: Freddie DeBoer’s post on naturalism and the skeptical conclusions that follow from it is fuzzy philosophy. (The Sam Harris TED talk he’s riffing on is worse, but that’s another story.) Regular readers will recognize this as one of my minor obsessions, an instance of theorizing “in the shadow of God.” I’ve applied the phrase in the past to describe worries that a naturalistic worldview—lacking space for deities or radically autonomous immaterial selves—creates all sorts of dire problems for morality or meaning. In most cases, I argue, the apparent problem actually stems from some hand-me-down conceptual furniture left over from the theological worldview. And usually the way to untangle the knot is to make a Euthyphro move. That is, you might worry that morality is in trouble without God until you grok that morality with God isn’t in any better shape: The deity turns out to be a black box that rather looks like it might do some heavy lifting on a tough philosophical problem, but on closer inspection it turns out not to make any difference...
Paul Krugman writes:
Don’t Be Narrow-Minded: I see that Greg Mankiw seems to favor narrow banking: require banks to hold all their deposits in liquid, short-term assets, thus obviating the risk of financial crises.... I’d argue that this is all wrong, on two levels: if it were possible, it would do away with the main purpose of banks, and anyway, it’s not possible....
I think of the whole bank regulation issue in terms of Diamond-Dybvig, which sees banks as institutions that allow individuals ready access to their money, while at the same time allowing most of that money to be invested in illiquid assets. That’s a productive activity, because it allows the economy to have its cake and eat it too, providing liquidity without foregoing long-term, illiquid investments. If you were to enforce narrow banking, you would be denying the economy one of the main ways we manage to reconcile the need to be ready for short-term contingencies with the payoff to making long-term commitments...
Let me focus on Krugman's first objection to narrow banking. It helps, I think, to ask the economist's question: What is the market failure? What is the market failure that would justify narrow banking--which means using the fist of Leviathan to shut down the maturity-transformation industry? Why not let those who promise that they can turn long-term illiquid risky sow's-ear investments into short-term safe liquid silk purses carry out their trade?
The answer, I think, is that two things are going on, both rooted in saver psychology. The first is herding in financial markets, which means that savers' and financiers' demand for safe, liquid, short-term assets fluctuates wildly and unpredictably. The second is that there is a strong demand for safe assets which is a demand for safe assets--and that means that the price of safe assets with respect to consumption goods cannot fluctuate, for if it did fluctuate then they would not be safe assets, would they?
Back before the industrial revolution this was not a problem, for the capital stock of the economy was overwhelmingly composed of consumption goods of one sort or another. If Antonio, Renaisssance-era merchant of Venice, faces a sudden shift in his investors' portfolio preferences as they want more safety and liquidity, with a sigh he unloads the silks of China, the spices of Indonesia, and the perfumes of Arabia from his ships and distributes them to his investors. But once you get canals, railroads, and cotton mills on a large scale you cannot do that anymore--you cannot deleverage the economy as a whole rapidly by consuming your existing capital. That is why it is no accident that the modern market-driven financial crisis and the industrial business cycle start in 1825, as the British Industrial Revolution enters its heyday.
So once the Industrial Revolution has come we have a problem. We can solve this problem through narrow banking--through shutting down the maturity-transformation market by saying, "sorry, we simply cannot create safe assets to meet your demand." Or we can solve this problem by having the government--that is, taxpayers in general--act as lender-of-last-resort, that is provide insurance against their own unstable psychology to savers and financiers. The second--if it can be done--seems to me to be better: it offers higher utility, for it responds to a market failure not by shutting down a market and throwing all the utility it generates away but rather by using the government to repair the consequences of the market failure.
Or, to quote from chapter 17 of John Maynard Keynes's General Theory of Employment, Interest and Money:
Unemployment develops, that is to say, because people want the moon;--men cannot be employed when the object of desire (i.e. money) is something which cannot be produced and the demand for which cannot be readily choked off. There is no remedy but to persuade the public that green cheese is practically the same thing and to have a green cheese factory (i.e. a central bank) under public control.
I do hope, someday, to have an important and valid insight that is original--that was not anticipated by Smith, Ricardo, Keynes, or Akerlof. But even I can see that my chances are not good...
David Wessel reports that Greg Mankiw has declared himself in favor of narrow banking:
MHow Much Leverage Do Banks Need to Be Useful?: The conversation between Alan Greenspan and some of then nation’s most prominent economists at the Brookings Panel on Economic Activity on Friday was deemed “not for attribution” by the organizers. But Greg Mankiw, the Harvard economist, has posted his response to Greenspan on his web site. You can read it here. He largely agrees with Greenspan, but differs on one key point:
The issue concerns the importance of leverage to the viability of a financial intermediary.... Alan proposes raising capital requirements and reducing leverage, but he suggests that there are limits to how much we can do so. If we reduce leverage too much, he argues, financial intermediaries will be not be sufficiently profitable to remain viable. He offers some back-of-the-envelope calculations that purport to show how much leverage the financial system needs to stay afloat. I think it is possible to imagine a bank with almost no leverage at all. Suppose we were to require banks to hold 100 percent reserves against demand deposits. And suppose that all bank loans had to be financed 100 percent with bank capital. A bank would, in essence, be a marriage of a super-safe money market mutual fund with an unlevered finance company. (This system is, I believe, similar to what is sometimes called “narrow banking.”) It seems to me that a banking system operating under such strict regulations could well perform the crucial economic function of financial intermediation. No leverage would be required. One thing such a system would do is forgo the “maturity transformation” function of the current financial system. That is, many banks and other intermediaries now borrow short and lend long. The issue I am wrestling with is whether this maturity transformation is a crucial feature of a successful financial system. The resulting maturity mismatch seems to be a central element of banking panics and financial crises. The open question in my mind is what value it has and whether the benefits of our current highly leveraged financial system exceed the all-too-obvious costs.
Daniel Davies reminds us that Walter Bagehot wrote what is still nearly the last word on small banking proposals 137 years ago:
I know it will be said that in this work I have pointed out a deep malady, and only suggested a superficial remedy. I have tediously insisted that the natural system of banking is that of many banks keeping their own cash reserve, with the penalty of failure before them if they neglect it. I have shown that our system is that of a single bank keeping the whole reserve under no effectual penalty of failure. And yet I propose to retain that system, and only attempt to mend and palliate it. I can only reply that I propose to retain this system because I am quite sure that it is of no manner of use proposing to alter it. A system of credit which has slowly grown up as years went on, which has suited itself to the course of business, which has forced itself on the habits of men, will not be altered because theorists disapprove of it, or because books are written against it. You might as well, or better, try to alter the English monarchy and substitute a republic, as to alter the present constitution of the English money market, founded on the Bank of England, and substitute for it a system in which each bank shall keep its own reserve. There is no force to be found adequate to so vast a reconstruction, and so vast a destructions and therefore it is useless proposing them.
IMHO, the answers to Greg Mankiw's explicit and implicit questions appear to be:
The major complaint Bagehot would have over the past two years is that the U.S. government has lent but it has not lent at a penalty rate--that it should have, as a price for its aid, have taken such large equity stakes in America's banks to make its interventions big and obvious money-makers for the Treasury, and the necessity of private banks' resorting to borrowing from the lender of last resort big and obvious money-losers for bank executives and shareholders.
Why oh why can't we have a better press corps?
Menzie Chinn reads Robert Samuelson so we do not have to. Thank you, Menzie:
Econbrowser: Robert Samuelson on Economics: And on unavoidable spending, and debt crises, and on budget accounting... From the Washington Post: comes this headline:
With health bill, Obama has sown the seeds of a budget crisis
Here's a choice excerpt:
Should the United States someday suffer a budget crisis, it will be hard not to conclude that Obama and his allies sowed the seeds, because they ignored conspicuous warnings. A further irony will not escape historians. For two years, Obama and members of Congress have angrily blamed the shortsightedness and selfishness of bankers and rating agencies for causing the recent financial crisis. The president and his supporters, historians will note, were equally shortsighted and self-centered -- though their quest was for political glory, not financial gain.
Kinda wierd -- I thought that Obama was inaugurated in January 20, 2009, which is somewhat less than two years ago.... I thought it interesting that Mr. Samuelson neglected to mention how much of the upward jump in the debt-to-GDP ratio occurred before January 2009.... Here is where Mr. Samuelson dismisses the entire budgeting process in Washington:
But the CBO estimate is misleading, because it must embody the law's many unrealistic assumptions and gimmicks. Benefits are phased in "so that the first 10 years of [higher] revenue would be used to pay for only six years of spending" increases, a former CBO director, Douglas Holtz-Eakin, wrote in the New York Times on March 20. Holtz-Eakin also noted the $70 billion of premiums for a new program of long-term care that reduce present deficits but will be paid out in benefits later. Then there's the "doc fix" -- higher Medicare reimbursements under separate legislation that would cost about $200 billion over a decade...
I also like how Mr. Samuelson conveniently lumps certain spending as avoidable, and some unavoidable. I find in particular this passage from a 2006 WaPo article highly amusing (to say the least): "Some of Bush's spending increases (defense, homeland security) were unavoidable."... [A] simple question. Why do we ascribe any credibility to a person with an undergraduate degree in political science (what is called Government at Harvard) in the area of economics (let alone accounting)?
The fact is that the health care reform bill is a very larage lung-run deficit reducer unless none of the changes in Medicare reimbursement stick. And they will stick--unless, that is, Roberts and Scalia decide somehow to make sure that they don't.
He does not want to calm down:
When nearly 10% of the people are unemployed and government is looking the other way hoping it will somehow fix itself, I have no intention of calming down no matter how rosy the long view might be. It's nice that all these wonderful things are happening, and I also hope they will continue, or even accelerate, but that doesn't change the immediate needs one bit. Calm down while people are struggling to make ends meet? I don't think so...
The legwork is not mine, but Financial Disclosure Forms are wonderful things. Give to the Republican National Commitee, and you may well wind up funding someone's night out at Voyeur West Hollywood:
Schedule B for Line #21B: ITEMIZED DISBURSEMENTS Line #: 21B. Committee: REPUBLICAN NATIONAL COMMITTEE:
Steele's RNC seems to have reimbursed the strip club expenditure twice--cut one check to the strip club to pay the bill, and a second check to Erik Brown to reimburse him for paying the bill. Sloppy accounting errors that lead to double reimbursements are bad. Having people working for you who take advantage of double reimbursements are bad as well...
Was RNC Chair Michael Steele in town? Put it this way. He swung through LA in late January and the reimbursement check was apparently cut on February 4. It would be very odd if the RNC's big January event and afterparty was held when he was not in town.
Who is Erik Brown?
Perhaps: Political Director of Orange County Young Republicans:
Profile: Erik Brown is Chief Executive Officer of DMI, Dynamic Marketing Inc. a direct marketing/media production company with offices in California and Washington DC...
UPDATE: Via Wonkette, Rebecca Schoenkopf says that she believes that Erik Brown is the fall guy in this one...
The Plum Line: Some interesting numbers on “repeal” from CNN just landed in the old in-box:
Thinking about the health care bill that Congress passed this week, which of the following statements best describes your view of what Congress should do in the future?
Congress should make additional changes to increase the government’s involvement in the nation’s health care system: 27%
Congress should leave the bill as it is: 23%
Congress should repeal most of the major provisions in that bill and replace them with a completely different set of proposals: 47%
No opinion: 3%
For Dems, there’s no denying that the repeal number of 47%, nearly half, is uncomfortably high. That said, a total of 50% don’t want repeal, and more than one-fourth, 27%, want more reform.... No matter how realistic repeal is in the real world, these numbers suggest that the battle over the promise of repeal will continue to occupy a central place in the 2010 midterms, and could be every bit as polarizing as the previous 12 months. No rest for the weary...
Where CNN fell down on the job is in not specifying what the "completely different set of proposals" would be. As far as I know, the Republican Party is still at:
Republicans’ plan for common-sense health care reform our nation can afford without a government takeover of our nation’s health care system that kills jobs, raises taxes on small businesses, or cuts Medicare for seniors:
- Number one: let families and businesses buy health insurance across state lines.
- Number two: allow individuals, small businesses, and trade associations to pool together and acquire health insurance at lower prices, the same way large corporations and labor unions do.
- Number three: give states the tools to create their own innovative reforms that lower health care costs.
- Number four: end junk lawsuits that contribute to higher health care costs by increasing the number of tests and procedures that physicians sometimes order not because they think it's good medicine, but because they are afraid of being sued.
I suspect that CNN's numbers would have been quite different had their question been: "Congress should repeal most of the major provisions in that bill and restore insurers' power to deny coverage based on pre-existing conditions..." Yet once you set as a goal eliminating coverage denials, the next resting point is RomneyCare--or something very close to it.
Wow. Just wow:
Apology: In 1994, Philip Bowring, a contributor to the International Herald Tribune’s op-ed page, agreed as part of an undertaking with the leaders of the government of Singapore that he would not say or imply that Prime Minister Lee Hsien Loong had attained his position through nepotism practiced by his father Lee Kuan Yew. In a February 15, 2010, article, Mr. Bowring nonetheless included these two men in a list of Asian political dynasties, which may have been understood by readers to infer that the younger Mr. Lee did not achieve his position through merit. We wish to state clearly that this inference was not intended. We apologize to Prime Minister Lee Hsien Loong, Minister Mentor Lee Kuan Yew and former Prime Minister Goh Chok Tong for any distress or embarrassment caused by any breach of the undertaking and the article.
Eschaton: Heckuva Job: Voters in California played their role, of course, but another thing we can thank our awesome news media for is the governator.
More Californians disapprove of the job performance of Gov. Arnold Schwarzenegger than any governor in modern state history including Gray Davis, who was ousted by Schwarzenegger in a popular uprising, according to a Field Poll released today. Seventy-one percent of California voters surveyed said they disapprove of Schwarzenegger's handling of the job, while 23 percent approve. The low ratings are shared across all demographics including party affiliation, region of the state, age and race or ethnicity.
Paul J. O'Rourke reads us the news:
News: President Signs Health Care Insurance Mandate: A Lesson in American History, Healthcare and the Constitution for 14 State Attorneys General: Let’s begin today’s history lesson with the following news:
(CNN) -- Officials from 14 states have gone to court to block the historic overhaul of the U.S. health care system that President Obama signed into law Tuesday, arguing the law's requirement that individuals buy health insurance violates the Constitution. Thirteen of those officials filed suit in a federal court in Pensacola, Florida, minutes after Obama signed the Patient Protection and Affordable Care Act. The complaint calls the act an "unprecedented encroachment on the sovereignty of the states" and asks a judge to block its enforcement. "The Constitution nowhere authorizes the United States to mandate, either directly or under threat of penalty, that all citizens and legal residents have qualifying health care coverage," the lawsuit states.
The history lesson
In July, 1798, Congress passed, and President John Adams signed into law “An Act for the Relief of Sick and Disabled Seamen,” authorizing the creation of a marine hospital service, and mandating privately employed sailors to purchase healthcare insurance. This legislation also created America’s first payroll tax, as a ship’s owner was required to deduct 20 cents from each sailor’s monthly pay and forward those receipts to the service, which in turn provided injured sailors hospital care. Failure to pay or account properly was discouraged by requiring a law violating owner or ship's captain to pay a 100 dollar fine.... Perhaps these somewhat incompetent attorneys general might wish to amend their lawsuits to conform to the 1798 precedent, and demand that the mandate and fines be linked to implementing a federal single payer healthcare insurance plan. The other option is to name Presidents John Adams, Thomas Jefferson, James Madison et al. in the lawsuits. However, it might be difficult to convince a judge, or the public, that those men didn't know the limits of the Constitution.... I’m providing a copy of the 5th Congress’ 1798 legislation.
CHAP. LXXVII – An Act for the Relief of Sick and Disabled Seamen Section 1. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled - That from and after the first day of September next, the master or owner of every ship or vessel of the United States, arriving from a foreign port into any port of the United States, shall, before such ship or vessel shall be admitted to an entry, render to the collector a true account of the number of seamen, that shall have been employed on board such vessel since she was last entered at any port in the United States,-and shall pay to the said collector, at the rate of twenty cents per month for every seaman so employed; which sum he is hereby authorized to retain out of the wages of such seamen...
RT @fivethirtyeight: No more enthusiasm gap! 76% of Dem registered voters enthusiastic to vote in November, as are 75% of GOPers.
The Frum Firing Fiasco: AEI has embarrassed itself. Although allegedly a “think tank” with “scholars” AEI in fact a haven for highly partisan political actors, many of who have been disgraced by their time in government. Current “scholars” at the think tank include Lynne Cheney (who has written some cheesy novels), Newt Gingrich (another writer of schlock fiction), John R. Bolton, Charles Murray, Richard Perle (also a terrible novelist), Michael Rubin, Paul Wolfowitz and John (“torture memos” ) Yoo. These are not, to be as polite as humanly possible, figures that command respect for their scholarly achievements.
There are a few worthwhile people at AEI: Norman J. Ornstein always merits attention if you want to know about the ins-and-outs of congressional politics and Roger Scruton (when he’s not working as a shill for the tobacco industry) has written some fine essays on aesthetics. On domestic policy at least, Frum stood out from the partisan hacks who dominate AEI by trying to grapple with actual policy issues in an innovative way (however wrong-headed his solutions might be).... At his best Frum is the type of figure that John Stuart Mill was always on the look out for, a conservative who is intellectually challenging enough to make liberalism stronger. Following Millsian principals, I myself always want to read smart conservatives, who in recent years have been few and far between. Aside from Frum, only a handful of names come to mind: Christopher Caldwell, Andrew Coyne, Scott McConnell, Gertrude Himmelfarb, John Lukacs, Andrew Bacevich, and Joseph Epstein. Frum was an ornament to the AEI and his firing disgraces them...
Maybe we should all ask Alan Krueger and Ceci Rouse for some updated paper on the magnitude of this:
I was surprised that arguments about the impact of health care reform on labor mobility got so little attention during the debate over the legislation. It's an important benefit to include in the evaluation of health care reform (I made this argument several times, and there were many others who made this point as well, but it never seemed to resonate)....
One of the things that Republicans say they care about the most -- economic growth through the innovation that comes from small businesses -- will be helped substantially by the health care reform legislation Republicans did everything they could do to stop.... It's difficult to put a dollar value on mobility, but having observed people stuck in jobs they hate -- really hate -- just to keep health insurance, I'd guess it's worth a lot....
When you hear about the net cost of health care reform in terms of what it will do to the deficit and the accumulated government debt, those are just the costs and revenues that the government must bear, it does not net out all the implicit and explicit benefits to the private sector that come from the legislation (implicit and explicit costs to the private sector should also be added in, but I'd argue that the benefits to the private sector very clearly exceed the costs). When the benefits accruing to individuals and small businesses are included, the gains from reform are evident.
@hblodget's business model: Take a story about M&A fees associated with AIG. Illustrate with 2 hot babes kissing. http://bit.ly/dexECw
(Lost the link to this): What’s in the Bill:
The health-care bill covers 32 million uninsured—1 million more people than the Senate version of the bill would have, but 4 million fewer than the House’s original bill. While reform will cost $940 billion over the next 10 years, the Congressional Budget Office reports that it will reduce the deficit by $130 billion over the next decade, and by $1.2 trillion in the decade after that.
The bill will take effect in stages, and some of the most popular measures take effect within the first six months of its passage. Within six months, insurers will no longer be allowed to refuse coverage to kids because of pre-existing conditions. Nor will they be allowed to dump customers because they got sick. And they will be prohibited from capping how much coverage one person can get in a lifetime. Another provision that will become active within six months: Young people can continue to be covered under their parents’ health insurance until they’re 26.
By 2014, insurers will not be allowed to refuse coverage to anyone of any age because of pre-existing conditions. The year 2014 will also see the opening of state insurance exchanges, in which people can "comparison-shop" to buy health coverage. These plans would have to meet a minimum standard of benefits and would face new, stricter limitations on how much they could vary their premiums based on age. For instance, premiums for the elderly could cost no more than three times the price of plans for young people.
Compared to the Senate bill, the subsidies for buying insurance are bigger for families making between 2.5 and four times the federal poverty level. Aid will be offered on a sliding scale—families making less would pay less. A family of four making $44,000 would have insurance premiums limited to about 6 percent of the household’s income.
House Speaker Nancy Pelosi says the “Cadillac” tax becomes the “platinum Rolls-Royce” tax under the new plan. This excise tax on premium insurance policies—the cushy policies that cover much more care than average ones—has been tailored to affect fewer people and will go into effect later. Now, plans valued at $10,200 for individuals and $27,500 for families will be taxed starting in 2018. Those numbers will be indexed to the rate of inflation, meaning, the point where these plans begin to be taxed will inch upward as the same amount of money, because of inflation, gradually buys less stuff.
The bill imposes new taxes on wealthier people. Individuals making more than $200,000, and families making more than $250,000, will have to give up more of their paycheck to the Hospital Insurance payroll tax. Instead of paying 1.45 percent like most workers, they’ll pay 2.35 percent. And a new 3.8 percent tax will be added to income from interest, dividends, annuities, royalties, and rents.
The bill also imposes penalties on people who opt not to have health insurance. If you don’t buy insurance, starting in 2014 you will have to pay an annual fine of $95 or 1 percent of your income, whichever is greater. By 2016, that fine will rise to $695 or 2.5 percent of your income. For an insurance-free family, the fee is $2,085 or 2.5 percent of household income.
Employers who don’t offer their employees insurance will also pay a penalty: $2,000 per employee. Tax credits will help small businesses offer coverage (and those with less than 100 employers can join insurance exchanges), and businesses with less than 50 workers are exempt. Employers will have to say how much a worker’s health plan costs on their W-2 tax form.
Several measures intended to create incentives to lower Medicare costs are part of the bill. The Centers for Medicare and Medicaid Services will monitor hospital readmission rates and create cash incentives to encourage hospitals to lower return visits that are preventable. Doctors will be encouraged to form groups that work on improving quality of care, and a pilot program will bundle Medicare payments to urge hospitals to coordinate better. Five years from now, the method for paying doctors will begin rewarding those who provide the best care, rather than the most.
The bill fills the Medicare prescription-drug benefit’s “doughnut hole.” People who fell within it because their drugs cost more than $2,700 but less than $6,154 will get a $250 rebate in 2010. Next year, they’ll get a 50 percent discount on brand-name prescriptions. The hole will be completely closed within 10 years.
For the next four years, a temporary reinsurance program will cover people who retired early (ages 55 and up) but who aren’t eligible for Medicare yet (under 64).
Next year, primary-care doctors and surgeons will get a 10 percent bonus from Medicare. As part of a push toward more preventative care, Medicare beneficiaries will get a free yearly consultation that will craft a plan to help keep them from getting sick. Preventative care will be very cheap under new plans.
President Obama voiced his opposition to the inclusion of any special deals in the bill made for specific states in order to win the votes of particular lawmakers. Though many such deals were eliminated from the bill (see below), a few remain. A public hospital in Connecticut will get $100 million. In 2012 and 2013, hospitals in Tennessee that treat the poor will get $900 million (a move that Democrats say simply brings the state-funding levels to those of other states). Many residents of the small town of Libby, Montana—some of whom have been made sick by asbestos thanks to a mine now closed there—will qualify for Medicaid benefits. Louisiana will pocket an extra $300 million in Medicaid aid.
The bill also features new education funding, including aid for colleges that serve lots of minorities. Additionally, only the government will disburse federal student loans, instead of using banks as middleman.
Finally, the bill contains a few unexpected odds and ends—for instance, tanning beds that use ultraviolet lamps will be taxed 10 percent starting July 1.
What’s Not In the Bill:
The public option that many Democrats originally insisted was essential to health-care reform did not make the cut. That measure would have allowed people to choose a government-backed insurance plan instead of a private insurance policy. The House would have preferred a national insurance exchange instead of the state-based exchanges in this bill, arguing that a national exchange would have led to even lower insurance rates, since more insurers would be competing for more customers.
The deal Senate Majority Leader Harry Reid cut with Sen. Ben Nelson (D-NE) to win his vote last December became a symbol of ugly deal-making in Washington. Reid promised Nelson that all new Medicaid enrollees in Nebraska would be paid for by the federal government—forever. That favor, derisively known as the "Cornhusker Kickback," was eliminated from the bill.
Also cut: a provision that would have allowed 800,000 Floridians to hold on to enhanced Medicare benefits that old folks in other states are losing.
Why Jane Mayer deserves a prize: The New Yorker corrects the Thiessen account on torture and interrogation: Jane Mayer deserves some sort of special prize for all her writings -- a book and articles -- on the U.S. government's shameful and counterproductive use since 9/11 of torture in interrogations. I mention this because of her terrific review in the new issue of the New Yorker of a book by Marc Thiessen, a former speechwriter for Donald Rumsfeld and President Bush, who makes all sorts of wild claims about how well torture worked in protecting the country. Here's a taste of the masterful job Mayer does of exposing the Thiessen book:
Yet Thiessen is better at conveying fear than at relaying the facts. His account of the foiled Heathrow plot, for example, is "completely and utterly wrong," according to Peter Clarke, who was the head of Scotland Yard's anti-terrorism branch in 2006. "The deduction that what was being planned was an attack against airliners was entirely based upon intelligence gathered in the U.K.," Clarke said, adding that Thiessen's "version of events is simply not recognized by those who were intimately involved in the airlines investigation in 2006." Nor did Scotland Yard need to be told about the perils of terrorists using liquid explosives. The bombers who attacked London's public-transportation system in 2005, Clarke pointed out, "used exactly the same materials."
Nothing beats an on-the record response from those involved. The line I am getting from Theissen's defenders is that, Well, he criticized her, too, in his book. Let's see: One person is a reporter who worked alongside me the Wall Street Journal. The other was a flack for Jesse Helms and Rumsfeld. Who am I more likely to trust? It puzzles me that my old newspaper, The Washington Post, would hire Theissen to write for its op-ed page. How many former Bush speechwriters does one newspaper need?
Hoisted from Comments: RomneyCare Final Passage Aftermath Watch: No, the Republican Party Is Not Returning to Sanity Any Time Soon...: Robert Waldmann said...
I'd score round one of Luce vs DeLong as tied. I want round 2. It is honorable of you to open with an apology. You did quote him removing very necessary context. Importantly, he predicted the Republicans would be sane at some time in the future -- no Friedman units. Looking back Ford and (am I really typing this) Nixon seem pretty sane (sane people can be evil).
However, on quoting Gergen I think you are totally right and he is totally wrong. He says that Gergen is a prominent figure who advised 4 presidents. That does't mean that it is OK to quote Gergen's false claims without noting that they are false. The truth exists totally aside from the will of the powerful (not to mention Gergen isn't even powerful at the moment). You claim that Luce quoted a false claim without noting that it is false. He defends himself noting that the author of the falsehood is prominent. This actually happened. I think deep down Luce considers your reaction to Gergen to be unreasonable as would Gergen if he read this blog. In their view Gergen is not actually asserting that any Democrats claim that HCR solved all of our health care problems. He is just being ballanced (tm). Such false assertions are so common that they aren't even noticed. In fact, I'm sure Gergen had no sense he was being dishonest. He was saying the Republicans are being unreasonable. He added ballance without actually feeling that he was making an assertion about Democrats and without asking himself whether that assertion is arguably true of plainly totally utterly false.
By the way, one problem we have with health care is that there are some diseases that doctors can't cure oh and some morbidity which they can't prevent. Our problems with health care will be solved when we are immortal and remain youthful vigorous and healthy. Any seriousness at all would have made Gergen assert that some Democrats claim we have solved all of our problems with health care financing or health insurance or sometime. His statement about Democrats was not a real statement at all. It wasn't even a lie.
A note on editing. In the first draft of this comment I called Gergen's statement a lie. Then I found myself typing "Gergen had no sense he was being dishonest." I tried to remove the words "lie" and "liar" which assert that Gergen's statement has some relationship with an actual belief about actual reality. I don't really think that. I think he made a statement without any sense he was making a statement -- not even the sense of lying.
Inspired by Isaac Asimov, Second Foundation: dialogue:
"Had you remained on Kalgan we could not have touched you, surrounded as you would have been by your minions, your machines, and your mental powers."
"My mental powers are yet with me. And my minions and my machines are not far off."
UPDATE: Ed Luce protests at my use of him as a straw man. He is correct to do so. I owe him an apology, and I hereby apologize.
The Daily Dish: "The other day I went to look at their platform for the Democratic Party for our nation. I couldn't understand any of it. I don't speak any French," - Gov. Tim Pawlenty in New Hampshire Friday.
America: The recovery position: The Republicans will probably regain their balance...
Only if they get shellacked in the November 2010 election. Otherwise, given who will turn out in Iowa and New Hampshire in the winter of 2012, we face a long future of total Republican insanity. I have been told that the Republicans will soon regain their balance at least once very single Friedman unit since the winter of 1980, when George H.W. Bush denounced Ronald Reagan's enthrallment to "voodoo economics." Hasn't happened yet. George H.W. Bush's budget director Richard Darman may ahve said that "at some point partisan posturing must yield to the responsibility to govern"--but nobody in his political party has ever listened to him.
Somewhat more annoying is that Ed Luce gives airtime to David Gergen:
People will wake up one morning and realise that the healthcare bill hasn’t brought socialism to America. And Democrats will wake up to realise we have not magically solved all our healthcare problems. People should calm down a little. There has been a tendency to exaggerate recently.
Can Gergen point to a single Democrat who thinks that RomneyCare "has magically solved all our healthcare problems"? I don't know one, or know of one. The most that people are saying is that we have moved from having by far the worst health care financing system in the OECD to a health care financing system that is merely bad by the standards of the OECD...
UPDATE: Ed Luce protests. He has a very good point. I agree that his belief that the Republican ship will right itself is only one aspect (and not a major aspect) of his--quite good--column. But it is an aspect. And it is that belief that the Republican ship will right itself that I have been hearing ever since 1980:
and that I want to dispute.
I don't see the Republicans regaining their balance until the summer of 2012 at the earliest, when whoever wins the presidential nomination in the spring of 2012 tries to figure out how to win the presidency. That's the point of the quote that Andrew Sullivan highlighted from Pawlenty, who counts as the most reasonable Republican governor right now (save possibly for California's). Pawlenty--and everyone else--will be focused on the 2012 winter-spring Republican primary electorate for the next two-plus years. Until the summer of 2012 they will be talking to their base and to their base only--either to turn it out for November 2010 or to win its approval in winter-spring 2012.
Ed Luce emails:
Brad, you quote as selectively and out of context as any journalist. People reading your blog would be surprised to read the sentence in my piece that appears after the one you quoted: "But the apoplexy of recent days suggests they [Republicans] could take time to graduate from the anger and denial stages of loss." They would probably also be surprised to read the preceding part, which mocks Republicans' grasp of history and Hitler, refers to Boehner's Armageddon comment and the "anti-Christ" poll. The word "balance" in the sentence you do quote is clearly used in a different context to how you present it in your blog. Likewise, your readers probably wouldn't expect the piece to include sentences such as the following (and which helps frame it), "As Republians have been doing their best to demonstrate all week, Washington is not a very bipartisan town nowadays." A full reading renders your choice of headline - and therefore your reading of the piece - pretty eccentric... Finally, why is it such a sin to quote David Gergen? David has advised four presidents usually has a shrewd and very interesting perspective to share. Whether you agree with him or not is secondary to the question of whether he is worth hearing, which I certainly think he is. As indeed are you - and I always read your blog with interest. But I can't let you stand uncorrected on your selective misreading of my piece. Best wishes, Ed.
Here's the full context:
So what happens next? Three consequences are apparent. First, Mr Obama seems to be getting better at governing....
Second, success at home helps abroad....
The third consequence, and in some respects cause, of Mr Obama’s healthcare victory is the at least temporary capture of the Republican party by its radical wing. At a dinner in Washington this week, Newt Gingrich, the former Speaker and likely 2012 presidential candidate, described Mr Obama’s bill as the biggest threat to the “American way of life since the 1850s” when the country was heading for civil war.
Others, perhaps only sketchily aware of Adolf Hitler’s career, which is not remembered for efforts to extend healthcare to the uninsured, continue to toss around words such as “Gestapo” and “fascist”. John Boehner, the House Republican leader, saw the passage of what by normal standards should be seen as a centrist bill as “Armageddon”. Meanwhile, according to a Harris poll this week, 24 per cent of Republicans think Mr Obama “may be the anti-Christ”.
The Republicans will probably regain their balance. But the apoplexy of recent days suggests they could take time to graduate from the anger and denial stages of loss. It also suggests they will continue trying to block most of Mr Obama’s initiatives. As one of his advisers says: “With enemies like these, who needs friends?”...
My point is that I don't think the Republicans will regain their balance--not in the next Friedman Unit, and not in the next four Friedman units--unless, of course, they get shellacked in November 2010. I think Matthew Yglesias puts his finger on it:
Matthew Yglesias: Remembering the Goldwater Campaign: I think that to understand what’s wrong with the conservative movement today, you need to think about Barry Goldwater’s 1964 Presidential campaign. In ‘64, the GOP establishment felt that Goldwater was too radical. They said that nominating a hard-rightist like Goldwater would be counterproductive. But conservative activists worked hard, and they did it. Goldwater got the nod. And, just as the establishment predicted, Goldwater got crushed. And just as the established predicted, it proved to be counterproductive. The 1964 landslide led directly to Medicare, Medicaid, Title I education spending, and the “war on poverty.” In the 45 years since that fateful campaign, the conservative movement managed to gain total control over the Republican Party.... But it’s only very partially rolled back one aspect of the Johnson administration’s domestic policy. Which is just to say that the conservative movement from 1964-2009 was a giant failure.... But the orthodox conservative tradition of ‘64 is that it was a great success that laid the groundwork for the triumphs to come.... Which is to say that it... can’t think rigorously about its own goals. 2009-2010 has already seen the greatest flowering of progressive policy since 1965-66. No matter how well Republicans do in the 2010 midterms, the right will never fully roll back what the 111th Congress has done. And yet... if they win seats in 2010, conservatives will consider their behavior during 2009-10 to have been very successful...
As to why it's a sin to quote David Gergen, it's because David Gergen misrepresents the position of Democrats on the meaning of the passage of RomneyCare. Nobody is saying that it solved all of our health-care problems. Right-wing Democrats are saying it's a step, and as much as government can do, but not a complete step. Left-wing Democrats are clear that it is an inadequate step and wondering whether it is a forward step at all--or just a bill whose major long-run impact will be to enrich pharmaceutical companies and doctors while imposing a regressive health-care tax on America's working class. And the professionals--well, let me turn the mike over to Henry Aaron and Robert Reischauer:
Making the legislation a success requires not only that it survive but also that it be effectively implemented.... The legislation tasks federal or state officials with writing regulations, making appointments, and giving precise meaning to many terms. Many of these actions will provoke controversy. Performing them will take staff, money, and time. Given the current federal deficit and beleaguered state treasuries, needed staff and funding will be hard to come by. Even with adequate resources, implementing health care reform will be complex and difficult. Much of this challenge is inherent in the complicated and diverse ways in which health care is delivered and paid for in the United States. Part of the challenge arises from the likelihood that as implementation proceeds, unforeseen challenges will emerge.
To get some flavor of what lies ahead, consider the following. The law provides for income-based credits payable by the federal Internal Revenue Service (IRS) to insurers on behalf of households that apply for coverage through state-managed health insurance exchanges. IRS filing units (whether individuals, couples, or families) are not always the same as the units covered by a health insurance policy. Eligibility for health insurance subsidies should be based on current income, but the IRS has income information only for past years. Mechanisms for exchanging income information between the IRS and the state insurance exchanges will need to be developed, as will ways of handling subsidies when definitions of a family unit vary and when family composition or income changes....
Other issues arise because the legislation asks state officials, some of whom oppose the reform, to play a large part in its implementation. The bill calls on each state to set up its own health insurance exchange and permits the exchanges to operate under widely varying rules.... Averting insurance-company competition that is based on risk selection will require aggressive state oversight, which some states may be unwilling or unable to provide. These responsibilities will be terra incognita for many state administrators. Even when goodwill prevails, administrators will find implementation very difficult. However, the experience of the Commonwealth Connector... offers encouragement....
Furthermore, parts of the reform are bound not to work as expected. For example... Medicaid rolls in some states will expand by 50% or more. It is unclear whether these states will be able to find enough providers who are willing to accept the anticipated payment rates to serve this expanded population, even as the demand from better-paying patients for services is growing. If they don’t, will they raise provider payment rates, curtail Medicaid benefits (as states are legally authorized to do), or simply let patients fail to find doctors who are willing to provide them with care? To further complicate matters, some families may be able to buy insurance in several distinct ways, depending on their income, family composition, and state policy. Different family members may be eligible under Medicaid, under the Children’s Health Insurance Program (CHIP), through the exchanges with subsidies, through the exchanges without subsidies, or through a yet-to-becreated state basic health insurance plan. If employers offer plans that meet federal standards and cost households no more than stipulated fractions of the worker’s income, employees will not be eligible for insurance through exchanges, but if employment based insurance does not meet federal standards or is too costly, employees will have the option of buying insurance through the exchanges — with or without subsidies, depending on income. Small changes in income can push some, but not all, family members from one form of coverage to another.... These and myriad other implementation difficulties will fuel continued political controversy.
Passage of health care reform legislation is a cause for celebration. But supporters must not relax.They should prepare to meet the serious challenges that remain.... Far from having ended, the war to make health care reform an enduring success has just begun. Winning that war will require administrative determination and imagination and as much political resolve as was needed to pass the legislation.
No Democrats of my acquaintance or knowledge believe what David Gurgen imputes to them--that "we have magically solved all our healthcare problems." Indeed, the sentence I have heard most often about health care in the past week has been: "Gee. Nancy-Ann Min DeParle's next fifteen months in the White House are going to be a tougher job than her last fifteen months."
A Thin Line Between Hate And Love: Compare and contrast:
WSJ editorial, March 19:
This is what happens when a willful President and his party try to govern America from the ideological left, imposing a reckless expansion of the entitlement state that most Americans, and even dozens of Democrats in Congress, clearly despise.
Gallup, March 22:
Good/bad thing: 49-40. Dems: 79-9. Inds: 46-45. Reps: 14-76...
Actually, it’s not clear whether public opinion has changed all that much: a substantial fraction of those who disapproved of the reform did so because it didn’t go far enough. Anyway, true to form, one of the key talking points of reform’s opponents — that passing reform was an outrage because it denied the clear will of the people — turns out to be completely bogus.
Among Republicans, repeal is in, and the individual mandate is out. But once upon a time there was a health care bill that some Republicans found mighty attractive -- a bill that contained an individual mandate at its core. I'm referring to the Wyden-Bennett alternative, which would have covered about 94% of Americans. It would have required individuals to buy insurance, and it would have helped them do so by giving them a tax credit. That money would have come from taxing health benefits provided by employers. Wyden-Bennett... dropped like safe on the head of one of its authors, Robert Bennett. But at least two other Republicans in states whose attorneys general say that an individual mandate is unconstitutional went on the record as supporting... Wyden-Bennett version.... Sen. Lindsey Graham of South Carolina and Sen. Mike Crapo of Idaho. Other Republican cosponsors included Sen. Judd Gregg of New Hampshire and Sen. Lamar Alexander of Tennessee.... Mitt Romney was a fan of the Wyden-Bennett approach, speaking of it favorably and noting in June of 2009 that many Republicans liked what they saw in it.
Think Progress: Summers Takes On Boehner: ‘Punk Staffers’ Aren’t The Problem, Bank Lobbyists Are: Yesterday, speaking at the American Bankers Association governmental relations summit, House Minority Leader John Boehner (R-OH) told the gathered bankers to fight Congressional financial reform efforts. “Don’t let those little punk staffers take advantage of you and stand up for yourselves,” Boehner said. Today, White House National Economic Council Director Larry Summers fired back at Boehner, saying that bankers certainly do not need any help in their effort to blunt regulatory reform:
“I do not think that those who want to address these issues are ‘little punk staffers’ who need to be stood up to,” Summers said in a speech at the National Press Club.... “At a moment when there are four lobbyists per member of the House and Senate working on this issue, we in the Administration do not believe that the prominent issue is allowing bankers to stand up for themselves.”...
Boehner’s remarks are simply part of a long-running effort by Republicans to ingratiate themselves with the financial industry.... [J]ust today, as Sen. Richard Shelby (R-AL) told the ABA summit that “if there were 59 Senate Republicans, ‘you wouldn’t have to worry’ about a new consumer agency.” But as Summers noted, it’s not as if the financial services industry and its allies need any help.... All told, the financial services industry spent $500 million on lobbying in 2009...
Think Progress: Hatch: I Supported The Unconstitutional Individual Mandate In 1993 To Derail HillaryCare: Yesterday, Sen. Chuck Grassley (R-IA) admitted that he supported the individual mandate before he realized it was unconstitutional and now, Sen. Orrin Hatch (R-UT) has conceded that he too endorsed a policy that would have allowed the government “to tell you what you have to buy, even if you don’t want to buy it.” In 1993, Hatch, along with 20 other GOP senators — including Grassley, Bennett, and Bond — introduced a health care plan that would have required everyone to buy coverage, capped awards for medical malpractice lawsuits, established minimum benefit packages and invested in comparative effectiveness research. It was, in other words, a plan to “erode liberty.”
Last night, and then again this afternoon, Hatch was pressed on his past support for the 1993 proposal. What’s changed, CNN’s Campbell Brown and MSNBC’s Andrea Mitchell both wanted to know. Like Grassley, Hatch couldn’t come up with a very good answer. In 1993, Republicans hastily proposed the unconstitutional measure to fend off HillaryCare; nobody even understood the implications of the alternative policy, Hatch explained:
HATCH: Well, it really wasn’t. We were fighting Hillarycare at that time. And I don’t think anyone centered on it, I certainly didn’t. That was 17 years ago. But since then, and with the advent of this particular bill, really seeing how much they’re depending on an unconstitutional approach to it, yea, naturally I got into it, got into it on this issue.
Daily Kos: Spock with a Beard: The Sequel: For some years now, I’ve been morbidly fascinated by the political dark arts -- especially the very dark art of disinformation: the systematic creation and dissemination of false narratives designed to discredit your opponents and/or drive undecided audiences away from their cause. The difference between disinformation and just plain lying is in the scope of the enterprise: A lie is intended to conceal a specific truth (e.g. "I did not have sex with that woman"). Disinformation, on the other hand, is aimed at constructing an entire alternative reality -- one in which the truth can find no foothold because it conflicts just not with a specific falsehood, but with the entire fabric of the false reality that has been created. It puts the "big" in big lie, in other words.
These basic disinformation techniques were first pioneered by the totalitarian movements of the 1930s, such as the [GODWIN REDACTION] and the Soviet KGB, but they’ve been brought to their full fruition by the modern advertising, public relations and political consulting industries. Proving once again that what communism can do, capitalism can do better. One of the things that’s always impressed me about the modern conservative movement -- going back to when Newt Gringrich drew up his list of buzz words to be relentlessly associated with liberals ("corrupt," "degenerate," "depraved," etc.) -- has been the movement’s enthusiastic embrace of propaganda techniques developed by the same political regimes it claims to oppose with its life’s breath.
I guess they’re trying to proving that what totalitarians can do, modern conservatives can also do better. Karl Rove’s White House was, in many ways, the Olympian ideal of a disinformation operation -- a propaganda achievement that will probably never be topped, at least in American politics (God willing). But it looks as if the House Republicans are giving it the old college try. Thus the rather amazing press conference Minority Whip Eric Cantor held earlier today, in which the Virginia Republican in effect accused the Democrats of inciting violence against all those innocent teabaggers out there who are simply expressing their sacred constitutional right to spit on black people and fax pictures of hangman’s nooses to their elected representatives.... The specific disinformation technique in play is one I call "mirror image" (or, when I’m in a Star Trek mood, "Spock with a beard"). It consists of charging the opposing side (i.e. the enemies of the people) with doing exactly what you yourself have been accused of doing, typically with a hell of a lot more justification....
Will the ploy work this time? I don’t think so, or if so, only to a limited degree. The material may have been brilliant, but the performance sucked –- even Cantor couldn’t make himself sound like he actually believed it. Sure, Fox News is ready (as always) to take the baton and run with it, but I think the mainstream corporate media deadheads, brain dead as they may be, have finally picked up on the scam.
On the other hand, the headline from that Atlantic blogpost I linked to earlier suggests I may be the one who's brain dead here:
[Chris Good] Cantor Accuses Democrats of Using Threats, Violence to Score Points
Perhaps that was written strictly tongue in cheek, but I doubt it...