A paratrooper with the 82nd Airborne Division’s “Devil Brigade” aims his M240-B crew-served machine gun.

The Economist's Roger McShane is unimpressed with all the doom-mongering over proposed cuts to the Pentagon budget:

So by how much will the defence budget decline over the next decade? That could be seen as a trick question, because in nominal terms it will grow. Prior to the supercommittee's failure, the defence budget was slated to increase some 23% between 2012 and 2021. Now, according to Veronique de Rugy, the Pentagon will have to make do with a 16% boost…Or to put it another way, as Lawrence Korb does, the "sequestration will return defense spending in real terms to its FY 2007 level, the next to last year of the Bush administration, when no one was complaining about devastating levels of spending."

…But these numbers have not quieted the critics. And perhaps the most ardent among them has been [Defense Secretary Leon] Panetta. My colleague cites a statement from the secretary, in which he lists the tragic results of a 16% increase: "We would be left with our smallest ground force since 1940, the fewest ships since 1915 and the smallest Air Force in its history." Here's another fact: America already has the fewest ships since 1916, despite a 70% increase in defence spending between 2001 and 2010.

We could, of course, have thousands of ships and tens of thousands of warplanes if we wanted. But that would mean buying lots of PT boats and swarms of F-4s instead of a dozen Nimitz- and Ford-class supercarrier groups and a few hundred F-35s. We don't have a small number of ships and planes because we're too cheap to buy more, we have them because that's what the Pentagon wants. Modern war makes a small number of superadvanced weapons systems more effective than a bunch of cheap cannon fodder.

Defense hawks like to insist that we should judge the Pentagon budget as a percentage of GDP. The Bill Kristol contingent, for example, claims that we should never allow defense spending to fall below 4 percent of GDP. But is this a sensible way of looking at things? For some programs it is. Social Security and Medicare, for example, are both inherently tied to population growth and living standards, so as those go up so will outlays. But in other areas this doesn't make so much sense. Do we need more embassies overseas just because our GDP has grown? Not really. There will be some increase in wages that's tied to economic growth, but that's about it.

National defense falls into this category. The United States is no harder or easier to defend when our economy grows, so it's foolish to pretend that defense spending as a percentage of GDP should remain constant. It should go up when we're at war, or when external threats are high for some reason, and it should go down in other times.

This is one of those other times. Despite the best efforts of defense hawks to jangle nerves over China, the plain fact is that China remains a minuscule military threat and probably will remain so for the foreseeable future. We aren't going to start a land war in Asia, after all. Spending on cybersecurity will increase in the future, but it's still a nit in the grand scheme of Pentagon spending. On other fronts, Al Qaeda is all but dead, and our wars in Iraq and Afghanistan are winding down. We'll continue to keep troops in the Middle East and (for better or worse) we'll continue with our drone wars in Pakistan, Yemen, and elsewhere. But those are pretty cheap. As scary as terrorism might be, the fact is that it's primarily an intelligence expense. On a pure military basis, it's simply not a big-ticket threat.

So can we afford to reduce defense spending to 2007 levels? Of course we can. The world is not more dangerous today than it was in 2007, and there's no a priori reason it should cost more to defend the security of the United States today than it did in 2007. We might spend that money differently, of course. Perhaps the Pentagon will decide it would rather have a thousand more drones instead of a single additional supercarrier group. That might well make sense since the mission of supercarrier groups is becoming fuzzier all the time in an era of primarily asymmetric warfare.

The supercommittee sequestration will require the Pentagon to find additional cuts of about $50 billion per year in its budget. To pretend that this would make us virtually defenseless is to insult our collective intelligence. We can make that cut and still have the most powerful military on the planet by a factor of five or six. If that doesn't make you feel safe, nothing will.

Newt Gingrich in November 2011, asked what he told Freddie Mac when he was consulting for them in 2006-07:

My advice as a historian, when they walked in and said to me, "We are now making loans to people who have no credit history and have no record of paying back anything, but that's what the government wants us to do," as I said to them at the time, this is a bubble. This is insane. This is impossible.

Newt Gingrich in April 2007, during an in-house interview promoting the virtues of Freddie Mac, uncovered today by Morgen Richmond of the blog Verum Serum:

I think it is telling that there is strong bipartisan support for maintaining the GSE model in housing. There is not much support for the idea of removing the GSE charters from Freddie Mac and Fannie Mae. And I think it’s clear why. The housing GSEs have made an important contribution to homeownership and the housing finance system.

....Millions of people have entered the middle class through building wealth in their homes, and there is a lot of evidence that homeownership contributes to stable families and communities. These are results I think conservatives should embrace and want to extend as widely as possible. So while we need to improve the regulation of the GSEs, I would be very cautious about fundamentally changing their role or the model itself.

Hmmm. He seemed much more....upbeat....back when he was getting paid $1.6 million for his historical advice, didn't he? I guess the "insane" part must have been delivered only in private. Richmond comments:

Either he knew Freddie Mac’s lending practices were contributing to an unsustainable housing bubble headed for collapse, as he now claims, and yet accepted money to publicly defend them anyway. On their web site. Or he is now stretching the truth about his assessment of Freddie Mac’s problems at the time, and the advice he privately gave to their management.

Roger that. Newt's defense is (surprise!) that he's changed his mind since 2007. I'll bet you didn't see that one coming.

Max Boot has a piece in the LA Times today arguing that we should take a much tougher stand against Iran than we have so far:

In retrospect, weakness in the face of aggression is almost impossible to understand — or forgive. Why did the West do so little while the Nazis gathered strength in the 1930s? While the Soviet Union enslaved half of Europe and fomented revolution in China in the late 1940s? And, again, while Al Qaeda gathered strength in the 1990s? Those questions will forever haunt the reputations of the responsible statesmen, from Neville Chamberlain to Bill Clinton.

....Western policymakers have implicitly made the same assumption today that their predecessors made in the 1930s, 1940s and 1990s: that an immediate war, even one fought on favorable terms, is to be feared more than a looming cataclysm that is likely to occur at some indefinite point in the not-too-distant future. That was the right decision to make with Stalin's Russia; it was tragically wrongheaded with Hitler's Germany and the Taliban/Al Qaeda.

I was glad that I ended up reading the whole piece, because when Boot mentioned Stalin's takeover of Eastern Europe I thought maybe he'd lost his mind. But no: in the very last paragraph, he admits that not starting up a new war with the Soviet Union after Hitler's fall was the right thing to do. It was a terrible thing to do, but still the right thing.

But without that, Boot is left with only two examples: Neville Chamberlain, poster boy of the hawkish right for over 70 years now, and Bill Clinton. And Clinton isn't even a very good example: al-Qaeda didn't truly start to seem dangerous until 1998, and Clinton actually kept a fair amount of attention focused on them. It wasn't enough — primarily because the CIA and the Pentagon, like the American right, refused to take non-state terrorism seriously at the time — but it wasn't an example of appeasement. So at best, let's call it one and a half examples.

But here's what's interesting: when hawkish right-wing types make this argument, they always haul out poor old Neville Chamberlain. Boot throws in Bill Clinton, probably more for partisan reasons than because he truly believes Clinton was soft on al-Qaeda. But that's not exactly a complete history of softness toward potential enemies. When China turned communist in 1949, we let it happen. That was a good decision. When Vietnam did the same we eventually sent half a million troops over, and that turned out to be a bad decision. France took an aggressive stand in Algeria, and the Soviet Union did likewise in Afghanistan, and those were also pretty bad decisions in retrospect.

Sometimes aggressive action is a good idea. Sometimes containment is a good idea. Sometimes international pressure is a good idea. And sometimes just sitting back and letting events unfold for a while is a good idea. If you want to make the case for flattening Iran, you need to actually make the case for why it's worth it. We've gotten — or should have gotten — way past the point where you can just yell "Neville Chamberlain!" and expect anyone to take you seriously.

Zillionaire venture capitalist Nick Hanauer says his marginal propensity to consume is lower than mine:

Since 1980, the share of the nation’s income for fat cats like me in the top 0.1 percent has increased a shocking 400 percent, while the share for the bottom 50 percent of Americans has declined 33 percent. At the same time, effective tax rates on the superwealthy fell to 16.6 percent in 2007....In my case, that means that this year, I paid an 11 percent rate on an eight-figure income. 

One reason this policy is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the average American, but we don’t buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, I go out to eat with friends and family only occasionally.

....I can’t buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can’t buy any new clothes or enjoy any meals out. Or to make up for the decreasing consumption of the tens of millions of middle-class families that are barely squeaking by, buried by spiraling costs and trapped by stagnant or declining wages.

If the average American family still got the same share of income they earned in 1980, they would have an astounding $13,000 more in their pockets a year. It’s worth pausing to consider what our economy would be like today if middle-class consumers had that additional income to spend.

The rest is worth a read. We need entrepreneurs, but we need a thriving middle class even more. Washington DC's centrist punditocracy needs to have this pounded into their skulls.

(Via Jared Bernstein.)

Ask For More!

E.J. Graff asked all the men to leave the room before she linked to this reddit piece below, but I didn't. It's from an HR person at a tech company explaining why women routinely get lower salary offers than men:

The reason they don't keep up, from where I sit, is simple. Often, a woman will enter the salary negotiation phase and I'll tell them a number will be sent to them in a couple days. Usually we start around $45k for an entry level position. 50% to 60% of the women I interview simply take this offer. It's insane, I already know I can get authorization for more if you simply refuse. Inversely, almost 90% of the men I interview immediately ask for more upon getting the offer.

The next major mistake happens with how they ask for more. In general, the women I have negotiated with will say 45k is not enough and they need more, but not give a number. I will then usually give a nominal bump to 48k or 50k. Company policy wont let me bump more than 5k over the initial offer unless they specifically request more. On the other hand, men more frequently will come back with a number along the lines of 65k to 75k, and I will be forced to negotiate down from there. After this phase, almost all women will take the offer or move on to somewhere else, not knowing they could have gotten more if they asked.

At the end, most of the women I hire make between 45k and 50k, whereas the men make between 60k and 70k. Even more crazy, they ask for raises far less often, so the disparity only grows.

I apologize for sticking around, but there's a reason. I've run into this before myself, and have always told women "Just ask! The worst that can happen is that they say no." But that's not actually the case. Here's a bit of research on the subject:

Their study...found that women's reluctance [to negotiate] was based on an entirely reasonable and accurate view of how they were likely to be treated if they did...."What we found across all the studies is men were always less willing to work with a woman who had attempted to negotiate than with a woman who did not," Bowles said. "They always preferred to work with a woman who stayed mum. But it made no difference to the men whether a guy had chosen to negotiate or not."

So listen up, boys: there's a reason women don't negotiate as hard as men. Several of them, in fact. But one of these reasons is that men treat them shabbily when they do. So knock it off. Tell the women you love to negotiate the same as you would, and when they do, don't hold it against them. OK?

I'm so late to this story that I might as well be blogging about the evils of the tin trust or something, but there's an aspect of the whole Emma Sullivan story that I don't get. Emma Sullivan, of course, is the Kansas teenager who went on a field trip to the state capitol, listened to some remarks from Governor Sam Brownback, and tweeted:

Just made mean comments at gov. brownback and told him he sucked, in person #heblowsalot.

The governor's staff went ballistic, Sullivan's school principal demanded she apologize, the governor and the principal eventually backed down, Sullivan became an internet hero for a few minutes, and Ruth Marcus was appalled. "If you were my daughter," she wrote in the Washington Post, "you’d be writing that letter apologizing to Kansas Gov. Sam Brownback for the smartalecky, potty-mouthed tweet you wrote after meeting with him on a school field trip."

But forget all that for a moment. Forget the overreaction from the authorities, Sullivan's unlikely stardom, or Marcus's fainting couch performance. What I'm curious about is this: does anybody seriously have a problem with a teenager saying that somebody sucks? Or blows? That doesn't even qualify as crude language these days, let alone foul language, does it? It's just everyday teenager language. Am I mistaken to think that you could say something sucks in a high school classroom and not even get a titter, let alone a smackdown from most teachers? What am I missing here?

Republicans have been making hay for months over the NLRB's decision to consider a complaint from one of Boeing's unions about their decision to build the 787 Dreamliner in a shiny, new, non-union plant in South Carolina. The union believed this decision was made in retaliation for past strikes — something that would be illegal — and they believed this because Boeing CEO Jim Albaugh practically bragged about it in public interviews. Nonetheless, Republicans were apoplectic over the union's decision to challenge a move they believed was made illegally, and they were doubly apoplectic over the gall of the NLRB in allowing the challenge to go forward. Apparently they should have simply been told to pound sand instead of being given a hearing on the merits of the case. GOP leaders in the House introduced a bill in September to strip the NLRB of its authority in cases like this, and a few weeks later Rick Perry thundered that the NLRB had "undermined our free-market system." (In front of a South Carolina audience, of course.)

Yesterday, though, Boeing took away the GOP's lollipop:

The deal announced Wednesday between Chicago-based Boeing and the International Association of Machinists & Aerospace Workers, if ratified by union members, would help pave the way for a planned jump in production by the aerospace giant. It would alleviate the threat of strikes that could derail ambitious sales plans for a retooled version of Boeing's best-selling 737 aircraft, its new 787 Dreamliner and other jets.

Under the deal, Boeing said it will build the 737 Max, the retooled version, at a union plant in Renton, Wash. Boeing previously had said that work could go to another state, sparking anger from labor leaders and intense lobbying by politicians in Washington and elsewhere. In exchange, union leaders said that if their members approve the new deal, they will drop their opposition to Boeing's use of a new, nonunion plant in South Carolina to assemble some Dreamliners.

Hey, collective bargaining! I guess it works after all.

The Kaiser Family Foundation does regular polling about the public's view of healthcare reform, and the results are always interesting. This month's results, however, are even more interesting than usual. I might write a longer post about some of this later, but for now I just want to briefly highlight a few of the questions that most caught my interest. The full poll results are here. My top five most interesting results are below.

Overall favorability toward Obamacare has gone down only slightly since last year. But look at the partisan breakdown: Republicans and Independents have stayed rock steady the entire time. The decline has been almost entirely due to waning favorability among Democrats.

Among those who don't like Obamacare, nearly half admit that their dislike has nothing much to do with the law itself. They're just mad at Obama and/or Washington DC.

Only 37% of the public feels favorably toward Obamacare, but 50% want to keep or expand it. It turns out that many of the unfavorable/don't know opinions aren't from people who dislike healthcare reform, they're from people who don't think Obamacare went far enough.

Virtually every specific aspect of Obamacare is viewed favorably by over half the public. The only exception is the individual mandate. Even Republicans, it turns out, like most of the specific provisions of the law.

A fifth of the public says Obamacare has affected them negatively. But nearly all of this is because people have been convinced that Obamacare has caused their premiums to go up and their benefits to go down. Needless to say, this is nothing more than a fantasy fueled by Fox News.

Saudi Arabia has long said that it has loads of untapped reserves and would, within a few years, be on track to increase oil production from 10 million barrels per day to as much as 15 million barrels of oil per day. But Saudi production has stayed stubbornly at 10 million barrels. Last week, the CEO of Saudi Aramco said that global production from tar sands and shale oil now looked so promising that there was no need for more oil from the Kingdom:

"Rather than supply scarcity, oil supplies remain at comfortable levels, even given rising demand from fast-growing nations like China and India....All that makes spending on aggressive energy programmes unlikely," he said, adding that abundant affordable hydrocarbon supplies challenged investment in renewable technologies. As a result, Saudi Aramco had no plans to increase its oil production capacity to 15 million barrels per day, Falih said.

Should you believe this? No, you shouldn't. Chris Nelder has a nice piece today at SmartPlanet called "Why energy journalism is so bad," and at the end he provides six pieces of advice for reading press reports about oil and energy more broadly. Here's one of them:

2. Discount the sources. If the cited authority represents the oil and gas industry, you should view their forecasts as propaganda, not truth. Particularly when the authority is from an OPEC producer. OPEC (like the IEA) is a fundamentally political organization, and everything they say in public has a political calculus behind it. For example, I read the unconventional oil optimism expressed by the Saudi official cited at the top of this piece as their way of jawboning down peak oil fears, and throwing analysts off the scent of a trail which leads to serious questions about whether Aramco can increase spare production capacity, and whether the world’s most productive oil field, Ghawar, has indeed gone into decline.

Saudi Arabia has been making excuses for years for their inability to produce more than 10 million barrels of oil per day. This is the latest, and seemingly, the most definitive. They're publicly stating — for the first time, I think — that they aren't going to keep up the pretense anymore. Their exploration and drilling program is over, and 10 million barrels is as good as it's ever going to get.

The rest of Nelder's piece is worth reading if you want to understand a bit more about how energy journalism is put together. There really is reason to think that shale oil and fracking (as well as tar sands) will boost production of fossil fuels over the next decade or two. But you should be very, very skeptical of the happy talk about massive new finds and how this means energy independence at last. This stuff is promising, but every field isn't going to pan out at the most optimistic end of the forecasts, just like conventional oil fields don't all pan out at the most optimistic end of the forecasts. Caveat emptor.

From Corey O'Brien, a Democratic commissioner in Lackawanna County, Pennsylvania, expressing frustration with President Obama:

Enough with the soft approach. He's got to say, "I'm in charge, and I'm going to get it done with or without Congress." People are furious. Everybody here is petrified they are going to lose their jobs tomorrow, and I mean everybody.

Republicans have to be chortling at this. It's exactly the response they've been hoping for as we head into election season. Greg Sargent spells it out:

Mr. O’Brien appears to be suggesting that this is a widespread sentiment among Pennsylvanians, and it’s worth entertaining the possiblity that this is right. In a climate of extreme fear and anger over the economy, people may not care why Obama can’t get his policies through....If the guy in charge can’t deliver it, the risk is that people may conclude he’s well intentioned, but too weak or ineffective to get it done. How Obama handles this problem is going to be a key dynamic to watch, particularly today in this key bellwether region.

When it comes to domestic policy, there's virtually nothing the president can do without congressional approval. The American public, however, rather famously seems not to understand this, and Republicans know it perfectly well. With no real knowledge of how public policy works, and without a press willing to make it clear, congressional obstruction is essentially invisible and cost-free. So Republicans have spent the past two years doing everything in their power to make sure the economy doesn't recover, and now they're planning to ride that bad economy to victory in November.

Pretty great strategy, isn't it?