2011 - %3, October

Speaking of War Criminals

| Tue Oct. 4, 2011 4:42 PM EDT

Good news for Cote d'Ivoirians who would like to see any sort of incremental progress toward justice for alleged rapists, murderers, and civilian-attackers within their government. The judges of the International Criminal Court have approved an investigation into crimes committed during the past year's unrest. The judges have also given ICC chief prosecutor Luis Moreno-Ocampo a month to determine whether crimes also took place between 2002 and 2010, so they can decide whether to investigate that period as well. My guess as to the answer of that question: yes. Human Rights Watch has a whole library of research about an entire decade of war crimes perpetrated by the forces of both the former and current presidents.

Some cool things about this development: Cote d'Ivoire is not a member of the ICC, but it gave the court jurisdiction anyway, which says something about the spread of the institution's reach. Some of the crimes in Cote d'Ivoire happened very recently, which says something about the institution's potential justice-persuing speed. It's good that someone with prosecutorial power is investigating possible crimes. Plus, the ICC's investigation process, which basically involves dispatching a bunch of international research spies, is just cool on its own merits.

However, if this investigations results in the ICC issuing arrest warrants, it is going to catch more flack for only trying to arrest Africans. But it also will catch flack for not actually being able to arrest the Africans it has outstanding warrants for.

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Former FBI Interrogator: Cheney Owes Obama an Apology

| Tue Oct. 4, 2011 3:42 PM EDT

*After speaking at an event at the New America Foundation Tuesday, former FBI agent Ali Soufan weighed in on former Vice President Dick Cheney's call for President Barack Obama to apologize for its past criticism of Bush-era practices. Soufan thought it should be the other way around. "I think if Mr. Cheney wanted to apologize for not getting [Osama] bin Laden, for not getting the top leadership of al Qaeda, for the enhanced interrogation techniques that have caused more problems than anything else, the address is 1600 Pennsylvania Avenue," he said.

Chart of the Day: Perry's Plummet

| Tue Oct. 4, 2011 2:20 PM EDT

Here's the latest poll average from Real Clear Politics. Apparently, the more they see of Rick Perry, the less Republican voters like him.

Bernanke to GOP: Stop Sabotaging the Economy

| Tue Oct. 4, 2011 1:50 PM EDT

From Ben Bernanke, in testimony before Congress today:

The recovery is close to faltering.

It's good to see that someone is noticing. In Bernanke's prepared remarks, after noting tight credit, slow consumer spending, financial stress in Europe, and other problems likely to hurt the economy, he got to this:

Another factor likely to weigh on the U.S. recovery is the increasing drag being exerted by the government sector. Notably, state and local governments continue to tighten their belts by cutting spending and employment in the face of ongoing budgetary pressures, while the future course of federal fiscal policies remains quite uncertain....In setting tax and spending policies for now and the future, policymakers should consider at least four key objectives. One crucial objective is to achieve long-run fiscal sustainability....A second important objective is to avoid fiscal actions that could impede the ongoing economic recovery.

This isn't really new. But every time Bernanke says it, he edges slightly closer to calling GOP members of Congress idiots for obsessing about short-term austerity and spending cuts when they should be obsessing over how fast they can shovel money out the door. What's more, he's being as clear as he can that if Congress does this, the Fed's monetary policy won't get in the way.

But poor old conservative Ben Bernanke is now, in the view of most current Republicans, a dangerous radical lefty hellbent on debasing the currency and getting his Kenyan pal in the White House reelected. I wonder if he ever sees any humor in this?

A Brief History of Chris Christie Not Running for President

| Tue Oct. 4, 2011 12:40 PM EDT

Chris Christie is not running for president. Despite months of breathless speculation, the Republican New Jersey governor made it official on Tuesday with a press conference in Trenton. As he put it, "New Jersey, whether you like it or not, you're stuck with me." There were plenty of obstacles to a successful Christie candidacy—among other things, he's a conservative apostate on global warming, immigration, and the imminent takeover of American courts by Islamic extremists. He had no campaign organization, save for a few strategists who were holdovers from the hapless Rudy Giulliani campaign of 2008, and very little time to build one, what with the first primaries scheduled for January (if not earlier).

Christie's decision was ultimately the same one he's been trumpeting for more than a year: He's not ready. Too bad no one listened. Here's a quick recap of the will-he-or-won't-he speculation, 14 months in the making:

The High Price of Hidden Costs

| Tue Oct. 4, 2011 12:21 PM EDT

Austin Frakt read my defense of debit card fees on Friday and says today that it all makes perfect sense. But he's still annoyed by them. "That I feel this way is irrational, but I don’t care....The irrational, feeling part of me wants things to go back the way they were, even as the economist in me knows things are better now."

Right. Even though we won't admit it, most of us are far more likely to accept hidden costs than transparent costs. After all, they're hidden! We don't really know about them. Austin says there's a lesson here for healthcare:

Many policy experts and economists think it’d be far better if people knew the cost of health care, if they were aware what their full, employer-sponsored premiums cost, etc. I agree. Transparency is the right way to go.

But make no mistake, people will be annoyed. No, that’s not right. A $5/month debit card use fee is annoying. Suddenly learning that your income is lower than it would otherwise be by $10,000 because of your “employer-paid” premium is not annoying. It is enraging.

What will Americans do when they finally recognize the full cost of health care?....I think many people will be furious at how much of their paychecks are, effectively, being piped into the pockets of health insurers, health care providers, drug manufacturers, health IT gizmo creators, massive radiology machine developers, other device makers, and government programs. Some will think the return is worth the price. Many will not, particularly those who think insurers are wringing them dry.

Once you start thinking about it, you'll be surprised at just how addicted we all are to hidden costs. There are all the hidden bank fees, of course, which become enraging when they turn into transparent fees and we realize just how high they actually are. There's the hidden cost of healthcare that Austin points to — hidden because, in the American system, employers pay for most of it and most of us never really realize just how much we're really paying.

There are hidden taxes, too. If we want to reduce greenhouse gases, the single best way to do it is via a carbon tax. But that's transparent and produces a gigantic political battle. So instead we end up with direct EPA regulation, something that every economist in the world agrees is less efficient, less effective, and ultimately more costly than a tax. But the cost is hidden, so we all put up with it.

Ditto for tax expenditures, all those subsidies that we give people via breaks on their taxes. They don't seem like government spending, but they are — and they're less efficient than simply flattening the tax code and then making the subsidies directly.

Or there's Matt Yglesias's favorite hobbyhorse, zoning and construction regulations that hide the actual cost of keeping neighborhoods the way current residents like them. Or the hidden cost of supermarket "loyalty" programs, which fool us into providing retailers with valuable information in return for the mere illusion of lower prices.

We hairless apes have a seemingly infinite capacity to enjoy being fooled. But it's worth reminding ourselves every once in a while just how the high the cost really is for preferring inefficient hidden costs to the more efficient transparent kind.

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Our Persecuted CEOs

| Tue Oct. 4, 2011 11:30 AM EDT

Ezra Klein is in Cleveland at a conference filled with corporate CEOs. He reports back:

Business types really hate Barack Obama. Everybody sort of knows that, but it’s hard to get a sense of it if you’re not in the room listening to them laugh bitterly at questions like, “Does Obama understand the damage regulations are doing to business?”

....These folks really, really feel persecuted and unappreciated. The common response to this, of course, is that corporate profits have hit record levels in recent years and the top 1 percent has never been richer. But if you need more evidence that money doesn’t buy happiness, you should sit with some CEOs for an hour.

The fact that lots of blue-collar workers gave up on Democrats long ago and now vote mostly on cultural issues has been the subject of dozens of books and magazine articles. It's even easy to understand: In FDR's day, Democrats really did do a lot for these kinds of workers. Today, Democrats don't really do that much at all for them. So why shouldn't they just forget about economic issues and vote for the pro-gun guy?

Corporate CEOs are a different story. For decades, Republicans were the pro-business party and it made sense for business executives to vote for them. But what about now? Republicans are formally dedicated to blocking anything that might even remotely have a chance of improving the economy and thereby improve business prospects as well. And yet, CEOs show no sign of wavering loyalties. Just the opposite: they've largely bought the austerity/regulation/deficit fable hook, line, and sinker even though it makes not the slightest sense.

There's nothing really new about that, I guess, but it's still sort of freshly gobsmacking every time I see it in action. These are, supposedly, some of the smartest folks in the country. But they don't have a clue. You can't even say they're slaves of some particular defunct economist, as Keynes suggested. They're just slaves of folk economics at its folksiest and most vacuous — and most damaging. And they have every intention of taking the rest of us down with them.

Chart of the Day: Regulations, Still Not Job-Killing

| Tue Oct. 4, 2011 10:55 AM EDT

By now, it's straight-up GOP dogma: President Obama's government regulation jihad kills jobs. Prominent Republicans—including Majority Leader Eric Cantor (R-Virg.), Speaker John Boehner (R-Ohio), and not-a-class warrior Rep. Paul Ryan (R-Wisc.)—rail incessantly against the climate of "uncertainty" these rules on environmental and worker safety create for businesses, insisting that regulations prevent companies from investing in new hires.

Former Reagan and George H.W. Bush budget official Bruce Bartlett digs through data from the Bureau on Labor Statistics to prove none of that is actually true: Not only does the overall percentage of layoffs due to regulations barely register in the data. The number of layoffs attributed to government regulations has decreased since President Obama took office.

Barlett also draws on reams of anecdotal evidence that points at the chief cause of layoffs over the past three years—shrinking demand:

During June and July, Small Business Majority asked 1,257 small-business owners to name the two biggest problems they face. Only 13 percent listed government regulation as one of them. Almost half said their biggest problem was uncertainty about the future course of the economy—another way of saying a lack of customers and sales.

The Wall Street Journal’s July survey of business economists found, "The main reason U.S. companies are reluctant to step up hiring is scant demand, rather than uncertainty over government policies, according to a majority of economists."

In August, McClatchy Newspapers canvassed small businesses, asking them if regulation was a big problem. It could find no evidence that this was the case.

"None of the business owners complained about regulation in their particular industries, and most seemed to welcome it," McClatchy reported. "Some pointed to the lack of regulation in mortgage lending as a principal cause of the financial crisis that brought about the Great Recession of 2007-9 and its grim aftermath."

The latest monthly survey of its members by the National Federation of Independent Business shows that poor sales are far and away their biggest problem. While concerns about regulation have risen during the Obama administration, they are about the same now as they were during Ronald Reagan’s administration, according to an analysis of the federation’s data by the Economic Policy Institute....

Unemployment is much higher in those industries that one would expect to suffer most from a lack of aggregate demand: construction, leisure and hospitality, business services, wholesale and retail trade, and durable goods.

Just to be clear, then: There is no substantial evidence to support the assertion that government regulations are holding back the economy. As Kevin Drum wrote recently, "[b]usiness owners may not like new rules (who does?), but their real problem is a lack of customers. That's something we could go a long way toward fixing if we really wanted to."

Contrite Cain Now Says Perry Sign "Doesn't Matter"

| Tue Oct. 4, 2011 10:40 AM EDT
Herman Cain.

Just two days after arguing that Texas Gov. Rick Perry's leasing of a piece of land once referred to as "Niggerhead" showed a "lack of sensitivity," GOP presidential candidate Herman Cain is now saying that the issue "doesn't bother me at all."

"I really don't care about that word. They painted over it," he said, referring to a sign painted on a rock at the property the Texas Governor once leased. The Washington Post first reported Sunday that the slur appeared on the hunting grounds' gated entrance.

Cain added that he was "not playing the race card. I am not attacking Gov. Perry." What changed in the last 24 hours? Well for one thing, the conservative media made it profoundly clear to Cain that he had stepped out of line by the mere suggestion that a white Republican had acted inappropriately on an issue of race. In addition to conservative bloggers slamming Cain for "playing the race card," (accusations notably absent as Cain issued broad generalizations about black voters being "brainwashed" ) Rush Limbaugh issued a condemnation—more than sorrow than in anger of course. "I'm gonna tell you, this is really disappointing to me. Herman Cain. I liked Herman Cain—like Herman Cain," Limbaugh said. "There is certainly no substance to it, and there was no reason for Herman Cain to try to piggyback this." Doesn't Cain understand that his job is to protect white Republicans from accusations of racism, not amplify them?

Time to Take #OccupyWallStreet Seriously?

| Tue Oct. 4, 2011 10:22 AM EDT

Ezra Klein says it's not the protests themselves that have caused him to take Occupy Wall Street seriously. It's a Tumblr called, “We Are The 99 Percent,” full of personal stories of people who have, seemingly, done everything right but are still struggling with debt, unemployment, and a stagnant future:

This is why I’m taking Occupy Wall Street — or, perhaps more specifically, the ‘We Are The 99 Percent’ movement — seriously. There are a lot of people who are getting an unusually raw deal right now. There is a small group of people who are getting an unusually good deal right now. That doesn’t sound to me like a stable equilibrium.

The organizers of Occupy Wall Street are fighting to upend the system. But what gives their movement the potential for power and potency is the masses who just want the system to work the way they were promised it would work. It’s not that 99 percent of Americans are really struggling. It’s not that 99 percent of Americans want a revolution. It’s that 99 percent of Americans sense that the fundamental bargain of our economy — work hard, play by the rules, get ahead — has been broken, and they want to see it restored.

I haven't followed OWS super closely, but I started taking it seriously when the right-wing media started sounding a little scared. That was sometime last week after several unions joined the movement, and while I can't point to anything specific, it felt as though the tone at Fox and its allies changed a bit from lighthearted mockery to something a little more serious, as if OWS was a real threat that needed to be put in its place.

Anyway, we'll see. To be truly effective, OWS will have to get a lot bigger and lot more persistent. It's still not clear if this is something that can grow to a million+ people and stay active for multiple years. Because that's what it will take. For more, Lauren Ellis and Tasneem Raja have a roundup of OWS activities, coverage, and an interactive map of ongoing and planned protests.