There's been much talk of the "Californiafication" of Washington in recent days. Rich Yeselson summarizes the idea: "We are living through the Californiafication of America—a country in which the combination of a determined minority and a procedural supermajority legislative requirement makes it impossible to rationally address public policy challenges." Kevin wrote about this on Friday:

All I can say is this: for years I was basically uninterested in Sacramento politics because it was such a cesspool.  It made Washington DC look like a model of good government.  But no longer: Sacramento is still a cesspool, but DC is catching up fast.  If we keep it up much longer, the entire country may end up in the same mess we've made for ourselves here.  That would be decidedly not a good thing.

Actually, if you're a conservative, it might be a good thing. The Californiafication strategy makes it much easier to achieve otherwise-unpopular conservative policy goals like slashing health, education, and other popular government programs. (Remember, the largest parts of the federal budget—Social Security and Medicare—are also among the most popular. If you really wanted to drastically reduce the size of government and the tax burden, that's where you'd go.) The strategy goes a little like this: first, make it politically or structurally impossible to raise taxes (check). Next, allow liberals to enact their policy goals—but without raising taxes to pay for them. Then, when a recession hits, revenue on existing taxes will crater and the budget deficit will explode. Spending will have to be cut drastically since it's impossible to raise taxes—even more impossible now that there's a recession. Voila: you've reduced the size of government. This seems like a great way to get around the fact that a political agenda centered around the idea that government shouldn't try to solve people's problems isn't actually popular.

The Frakt Curve

You've heard of the Laffer Curve?  Today we get the Frakt Curve, courtesy of Austin Frakt, who suggests that trying to increase competition in the healthcare insurance market might reduce costs, but it might not.  It all depends on where we are on the curve:

[When insurer concentration is high] premiums are above the minimum possible level. Insurers are charging above the competitive premium level because they have excessive market power. In this region, higher premiums stem from higher insurer profits and/or lack of administrative efficiency....

[When insurer concentration is low] premiums are again above the minimum because insurers can’t negotiate down to the lowest possible price with providers. Providers have too much power relative to insurers and are charging prices above the competitive minimum. Insurers pass those high prices onto consumers through higher premiums. In this case, higher premiums stem from higher medical costs.

Austin's point is that to a large extent the healthcare battle is waged between insurers and providers.  Since the American healthcare system relies primarily on both private providers and private insurers (and this will be true even if a public option passes), we don't necessarily get the lowest costs when one side or the other is weakened, but when the two sides are fairly equally matched.  Thus, removing antitrust protection for insurers might lower costs or it might not.  It all depends on where we are on the curve right now.

Alternatively, we can try to move the entire curve downward.  Or we could ditch the whole thing and ask the Swedes to please design us a new healthcare system.  But in the absence of either of those things, where you are on the curve dictates whether and how much you need to rein in one half of the healthcare market vs. the other.

UPDATE: Michael Hiltzik makes the case for more insurance industry competition here.

Trita Parsi, NIAC, and AIPAC

Spencer Ackerman and Matt Yglesias have both weighed in on my post this morning about the attacks on Trita Parsi, the founder of the National Iranian American Council. Unlike Michael Goldfarb, Jeffrey Goldberg backed off the implications of his original comments (that Parsi does "legwork for the Iranian regime") when I emailed him. But Goldberg is still embracing a double standard, Spencer says:

Goldberg has a fairly low bar for people who write that, say, AIPAC does anything untoward or is an organization that represents anything nefariously deviant from the norm in ethnic American lobbies. He insists on, shall we say, a certain precision in discourse. Yet he has absolutely no problem saying that a guy who stood out in front in the U.S. in cheering on the anti-regime protesters is soft on the regime! “I assume, though I don’t know, that Parsi doesn’t take Iranian government money or Iranian government instruction, either.” Let’s employ a thought experiment. Say, I don’t know, Steven Walt or John Mearshimer wrote that about AIPAC. Would Goldberg consider that a judicious statement or a weasel-worded slander?

The Faster Times' Dan Luban made a similar point in his original post on the Parsi attacks:

It need hardly be said that these are the same commentators who would scream anti-Semitism if anyone were to level similar allegations against Jewish-American political figures. Yet it is undeniable that Goldfarb, Goldberg, and Kramer hold positions that are far closer to the Israeli government’s than Parsi’s position is to the Iranian government’s. Would it therefore be fair to label Goldfarb as “the Israeli government’s man in Washington,” or Goldberg as someone who “does a lot of leg-work for the Israeli government?”

Yglesias says the campaign against Parsi is "soon to be joined, according to my information, by a larger set of right-wing pundits and 'reporters.'" When I spoke to Parsi, he suggested that the allegations against him are based on charges that were made by Daioleslam Seid Hassan, a man Parsi sued for defamation last year. That case is ongoing, but it would definitely be easy for someone who was interested in attacking Parsi to reprint and draw more attention to Hassan's original charges. That's fine, but anyone who writes about those charges should make sure to note that Parsi disputes the allegations and is suing Hassan for defamation.

What could ExxonMobil CEO Rex Tillerson be discussing with the White House?

Tillerson, the head of the wold's largest oil company, has made three visits to the White House this year, according to the vistor logs released on Friday evening. Tillerson was the only energy company CEO listed on the logs, though the logs only include names specifically requested.

Tillerson met with both Larry Summers, the director of Obama's National Economic Council, and Carol Browner, director of the White House Office of Energy and Climate Change Policy. This is the same Rex Tillerson who has questioned climate science, but also advocated for a tax on carbon rather than a cap-and-trade plan. Oh, and Exxon continues to fund climate change denial despite pledging to stop.

Notably, the list doesn't seem to include any coal industry executives, a topic that drew attention earlier this year when Citizens for Responsibility and Ethics in Washington filed a Freedom of Information Act request for the records of visits from the CEOs of 16 major coal companies and lobby groups. It appears that none of those CEOs have been hanging out at the White House after all.

Other interesting visitors with an interest in climate and energy policy: General Electric CEO Jeff Immelt, who visited five times; Al Gore, who visited four times, and Newt Gingrich, who visited once.

UPDATE: Sebastian Jones also searched the logs and notes that that Chevron CEO David J. O'Reilly appears to have dropped by for five meetings with high-ranking administration officials.

Meet the Crooks Behind Your New Knee

You've read about all the jostling behind the scenes in Washington's quest to reform health-care: Big Pharma cutting a $80 billion backdoor deal with the White House, health insurers fighting tooth and nail against a public option, all affected parties and industries positioning themselves to reap the benefits of an overhaul of our $2.5 trillion health-care system. But there's another industry, one you've likely heard less about in the debate, that also stands to win or lose from reform: medical device makers.

The companies bringing you artificial hips, stents, defibrillators, and much more, medical device makers have not cut a deal with the White House or Democratic lawmakers, and face new taxes costing $20 billion or more if the legislation now circulating in Congress becomes law. But as writer Peter Stone points out in his story "Take Two Kickbacks" in Mother Jones' November/December issue, a lot more than tougher taxes is in order to reform the fraud-ridden, flawed medical device industry.

Stone's story highlights the prevalence of doctors receiving lucrative kickbacks in exchange for using and promoting a company’s medical products. This kind of illegal plying is so widespread, Stone reports, that between June 2006 and July 2009, device makers paid $535 million to the federal government for illegal marketing activities. One example: In 2006, Stone writes, device maker Medtronic "agreed to pay the feds $40 million to settle allegations that from 1998 through 2003 it had set up sham consulting and royalty agreements, trips to strip clubs in Tennessee, and other incentives to entice surgeons to use its spinal products." Though the consequences of these kinds of deals can be fatal, they're hardly novel in an industry plagued by graft and fraud. 

If Stone’s story shows us anything, it's that, like health insurers and drug makers, the medical device industry is long, long overdue for reform, too.

This Is the TARP That Never Ends...

It was a tall order last fall when then-Treasury Secretary Hank Paulson Jr. asked Congress for $700 billion and nearly unilateral power over how to spend it. With the nation on the precipice of economic Armageddon, Paulson's request was granted. But now, as financial reform legislation makes its way through Congress, some lawmakers are worried that Paulson's replacment, Timothy Geithner, may be attempting another Paulson-like power play.

Currently circulating on Capitol Hill is a draft of the House financial services committee's "Financial Stability Improvement Act," a wide-ranging effort to rein in too-big-to-fail institutions and bolster oversight of the financial-services industry. The legislation, spearheaded by Rep. Barney Frank (D-Mass.), the committee's chairman, and Secretary Geithner, who helped to craft the bill, would also create an oversight council staffed by government financial regulators, and would abolish the Office of Thrift Supervision, an agency faulted for its flimsy regulation before the crisis. (The Wall Street Journal has a good run-down of the legislation here.)

The legislation is meeting stiff oppostion, though, from members of both parties. What has lawmakers like Rep. Brad Sherman (D-Calif.) and Rep. Spencer Bachus (R-Alab.) riled up is a provision in the bill they say gives the White House and Treasury unchecked authority to spend taxpayer money, without Congressional approval, to bail out any too-big-to-fail bank that's poised to topple the economy. Sherman calls the provision "TARP on steroids," writing in The Hill:

Geithner's proposal reminds me of the Troubled Asset Relief Program (TARP), the $700 billion Wall Street bailout adopted last year, but the TARP was limited to two years, and to a maximum of $700 billion. Section 1204 is unlimited in dollar amount and is a permanent grant of power to the executive branch. TARP contained some limits on executive compensation and an array of special oversight authorities. Section 1204 contains absolutely no limits on executive compensation and no special oversight.

Disconcerting, indeed. The economy reached the point of near collapse, in large part, due to a gross absence of oversight. And the TARP as well has been marred by a lack of transparency and oversight: As bailout watchdogs have consistently pointed out, we still know very little about how TARP money was spent by institutions that received billions in bailout cash. With that in mind, do we want financial regulation that institutionalizes this opacity?

Health Care Reform: What Would LBJ Do?

As the Democratic leadership keeps rolling over to one health care industry demand after another, I'm reminded of a post that I wrote on my Unsilent Generation blog nearly a year ago, as Obama prepared to take office after promising to reform the American health care system. It's about President Lyndon B. Johnson's successful effort, back in 1965, to create the Medicare and Medicaid programs–-the only single-payer health care this nation has ever known. Like a lot of LBJ's War on Poverty programs, they were far from perfect. But compared with what today's Democrats are offering, they were something close to radical, and represented a triumph of political will on Johnson's part. 

I suspect that if if LBJ were alive today, he might have been able to get a decent reform bill through Congress, without all of the concessions to corporate interests that have rendered the Democrats' current legislation—including the public option—so weak that it is getting close to meaningless.

When it came to getting bills through Congress, LBJ—both as Senate Democratic leader and as president—had skills that make Nancy Pelosi, Harry Reid, and Rahm Emanuel, along with President Obama, look like rank amateurs. But more than this, he had the level of commitment—and the spine—required to stand up to opposing interests when it came to a basic need like health care.

I'm going to run most of that December 2008 post here, since its relevance has only increased with each passing month.

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Neocon Smear on "Iran's Man in DC?"

Did Michael Goldfarb, a former John McCain staffer and now an editor of the neoconservative Weekly Standard, defame Trita Parsi, the founder and president of the National Iranian American Council, by suggesting that Parsi is working for the Iranian government?

Last week, Goldfarb described Parsi as "the Iranian regime’s man in Washington." Goldfarb didn't present any evidence to support this. He stated it as fact and moved on. When I emailed Goldfarb asking if he meant to say literally that Parsi is working for the Iranian government, he doubled down, replying, "If it walks like an ayatollah and quacks like an ayatollah.... Maybe you should do your due dilligence [sic] on Trita Parsi."

As Daniel Luban points out in an interesting post at The Faster Times, Goldfarb may have crossed a line here:

[The comment seems to accuse] Parsi not merely of holding substantively wrong political beliefs but of actively working for Iranian and against American interests.

Parsi, whose group advocates negotiating with Iran, says he believes Goldfarb was indeed accusing him of toiling for the Iranian government. He insists that is "nonsense" and "clearly a political campaign" against NIAC. "Anyone who has followed NIAC knows how critical we have been of the Iranian government," Parsi says. After our conversation, a spokesman for NIAC sent me 15 statements and op-eds issued by the group this year that criticized the Iranian regime.

Goldfarb wasn't alone in criticizing Parsi. Last Wednesday, the Atlantic's Jeffrey Goldberg*  wrote that Parsi "does a lot of leg-work for the Iranian regime." Like Goldfarb, Goldberg did not cite any evidence. But when I emailed him about his comment, he backed away from implying Parsi was in league with Tehran:

No, I'm not saying he literally works for the Iranian regime. I think you're right, the term "leg-work" definitely could imply something I wasn't meaning to imply. If that's the way fair-minded people are reading it, then it's my mistake. What I meant to suggest is that his organization functions as Iran's AIPAC in Washington (though it's not as effective, of course). AIPAC, obviously, does a great amount of leg-work—meaning, in my understanding, a great deal of lobbying and advocacy—to advance its primary cause, a militarily and politically powerful Israel closely allied with the United States. But it doesn't take Israeli money, or, as best as I can tell, Israeli instruction. I assume, though I don't know, that Parsi doesn't take Iranian government money or Iranian government instruction, either. I think he does argue quite vociferously against sanctions, and he does tend to present, at least in my reading, a fairly benevolent understanding of Iran's rulers and their motivations, and a fairly harsh reading of the Israeli government's motivations. 

Goldfarb and Goldberg's remarks could potentially have legal consequences.

After another writer made similar allegations on a website, iranianlobby.com, in 2007, Parsi and NIAC sued for defamation. (The case is ongoing.) Parsi notes that his organization has not yet decided whether to pursue legal action against Goldfarb and Goldberg.

There's no credible, publicly available evidence that Parsi is paid by or takes instructions from the Iranian government. If Goldfarb is charging that Parsi really is an operative for the ayatollahs, he ought to back up the claim—lawsuit or not.

*Clarification: I don't think Goldberg's a neocon, and I hope this post doesn't imply that he is.

US Army 1st Lt. Russell Dasher teaches a boy how to "fist bump" as Army Staff Sgt. Donald Ottaway looks on at the Andar district bazaar in Afghanistan's Ghazni province, Oct. 20, 2009. (US Air Force photo by Master Sgt. Sarah Webb.)

Need To Read: November 2, 2009

Today's must-reads:

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