Tyler Cowen writes today about the monetary views of Scott Sumner:

The Fed has already taken some unconventional monetary measures to stimulate the economy, but they haven’t been entirely effective. Professor Sumner says the central bank needs to take a different approach: it should make a credible commitment to spurring and maintaining a higher level of inflation, promising to use newly created money to buy many kinds of financial assets if necessary. And it should even pay negative interest on bank reserves, as the Swedish central bank has started to do. In essence, negative interest rates are a penalty placed on banks that sit on their money instead of lending it.

Much to the chagrin of Professor Sumner, the Fed has been practicing the opposite policy recently, by paying positive interest on bank reserves — essentially, inducing banks to hoard money.

Of all the things the Fed has done to fight the recent financial meltdown, this is the one I've never quite understood: paying interest on bank reserves.  As a general policy it might be a good idea (Steve Randy Waldman wrote a decent primer about it here), but as Sumner points out, in the middle of a financial crisis it gives banks an incentive to hoard money at the Fed instead of loaning it out.  That's the opposite of what we want.

On the other hand, minimum bank reserves are still mandatory in the U.S., so I guess I also don't understand the point of negative interest.  Banks are required to keep those reserves at the Fed, so they couldn't withdraw them even if they wanted to.  Essentially, a negative interest rate would just be a tax on banks.

So, as usual, I'm confused.  This doesn't really seem to make sense either way.

I can't decide whether the ongoing Birther resurgance is a) the usual wingnuts doing their usual wingnut thing, or b) a brilliant GOP tactical ploy to divert attention from health care reform. You? While you mull it over, 3 questions for your Monday mix:

1) Will health care reform actually happen?

2) Carbon footprint, sure. But what's your water footprint?

3) Why is HBO's 40-year-old co-creator of Hung claiming there are no talented and attractive actresses over 35?

Laura McClure hosts podcasts, writes the MoJo Mix, and is the new media editor at Mother Jones. Read her investigative feature on lifehacking gurus in the latest issue of Mother Jones.

I can't decide whether the ongoing Birther resurgance is a) the usual wingnuts doing their usual wingnut thing, or b) a brilliant GOP tactical ploy to divert attention from health care reform. You? While you mull it over, 3 more questions for your Monday mix:

1) Will health care reform actually happen?

2) Carbon footprint, sure. But what's your water footprint?

3) Why is HBO's 40-year-old co-creator of Hung claiming there are no talented and attractive actresses over 35?

Laura McClure hosts podcasts, writes the MoJo Mix, and is the new media editor at Mother Jones. Read her investigative feature on lifehacking gurus in the latest issue of Mother Jones.

Sen. Tom Harkin (D-Iowa), one of the most labor-friendly senators, is headed to the White House for a closed-door meeting with the President this afternoon. It's one of a series of meetings on health care, Harkin's office says. Noticeably not on the agenda is the Employee Free Choice Act, which would make it easier for unions to organize.

The big fault line in the healthcare debate right now is over the "public option" — a proposal that people should have the option of getting healthcare coverage from either a private insurance carrier or from a government program.  Conservatives are worried that this would put too much pressure on private insurers, but Michael Hiltzik asks the obvious question: who cares?

The firms take billions of dollars out of the U.S. healthcare wallet as profits, while imposing enormous administrative costs on doctors, hospitals, employers and patients. They've introduced complexity into the system at every level. Your doctor has to fight them to get approval for the treatment he or she thinks is best for you. Your hospital has to fight them for approval for every day you're laid up. Then they have to fight them to get their bills paid, and you do too.

....Why do we tolerate this? The industry loves to promote surveys indicating that most Americans are "satisfied" with their current health insurance — 37% are "very satisfied" and 17% "extremely satisfied," according to one such study.

Yet these figures are misleading. Most people are satisfied with their current insurance because most people never have a complex encounter with the health insurance bureaucracy. Medical care generally follows the so-called 80-20 statistical pattern — 20% of patients consume 80% of care. If your typical encounter is an annual checkup or treatment of the kids' sniffles, or even a serious but routine condition such as a heart attack, your experience is probably satisfactory.

But it's on the margins where the challenges exist. Anyone whose condition is even slightly out of the ordinary knows the sinking feeling of entering health insurance hell — pre-authorizations, denials, appeals, and days, weeks, even months wasted waiting for resolution.

Sounds great to me!  Why would anyone want to change this system?

Health insurance is a weird industry.  Healthcare itself is provided by doctors, nurses, hospitals, pharmaceutical companies, hospices, and device makers.  Insurance companies do none of this.  They don't do research, they don't perform surgeries, they don't change bedpans, and they don't make diagnoses.  They're just middlemen.  All they do is pay the bills after marking them up 30%.  They don't do anything at all to make healthcare better or more efficient.

But for some reason we're supposed to care about whether they continue to exist or not.  Why?  I care about the quality of my doctors, my nurses, the hospital I go to, and the drugs I take.  I don't really care who takes on the administrative task of paying the bills — except that I wish they were handled a lot more efficiently and with a lot less hassle than private insurers typically do.  Frankly, a world without private healthcare insurers sounds pretty good to me.

And as long as we're reading the LA Times, they've got a nice piece by Michael Rachlis, a doctor in Toronto, about the Canadian healthcare system.  Guess what?  It's pretty good!  It's not the system I'd choose — in particular, I think public funding should provide a basic level of healthcare but patients should always have the right to pay more for better care if they want to — but it works as well or better than ours for a fraction of the cost.  Read the whole thing for more.

Some web weirdness/wonderfulness to perk up your Monday. Check out these paintings of an unabashedly nude Obama riding a unicorn, getting a massage from said unicorn (left), and confronting a fetal-looking Rush Limbaugh. Along Obama's naked travels, he meets a glum-looking Dr. House, Stalin, and Sarah Palin.

Dusting off my art history major, I would say that some of artist Dan Lacey's artistic inspirations are Frida Kahlo, Diego Rivera, and early 20th century Russian Art with a dash of Chagal. Though given the high unicorn density, I'm sure Lacey has many other, ahem, non-traditional influences. Enjoy!

h/t to former MoJo fellow Daniel Luzer

Ezra Klein says "I'm not sure I'd term calls for procedural reform 'radical,' much less 'revolutionary.'" Here's what I said when Matt Yglesias said something similar:

Just because a reform is possible or even theoretically easy (i.e., doing away with the filibuster or carving out a federal district and making the rest of DC a state) doesn't mean it has any realistic chance of being enacted. So that puts pragmatists like Yglesias and Ezra Klein back in the same spot. If what the country needs is unlikely to happen without political reform, and political reform is very unlikely to happen, what is a pragmatist to do?

This conversation has drifted somewhat far afield from its original topic, which was Democracy in America's claim that Yglesias and Klein are not the "fundamentally moderate, process-oriented wonks" the conventional wisdom says they are. I took that claim to mean that such people would be incrementalist third way types who think that change can be accomplished by working within the system and the existing process. But that's not what the young progressive blogosphere is calling for. Instead, Klein and Yglesias are advocating for fairly dramatic changes to the way American politics works in practice. Right now, their message is largely that the system doesn't work, and Barack Obama can't get anything done because the system is flawed. Wouldn't making that system work be a pretty big change? Maybe we're just getting caught up in semantics here. But changing the way the President is elected, or changing the way powerful Senate committee chairs are picked, or making DC a state—as opposed to working within the system we have—all seem like pretty radical changes to me.

The New York Times reports that the communicator-in-chief plans to take his show on the road:

In coming weeks, senior administration officials said, the White House will begin a public-relations campaign in Israel and Arab countries to better explain Mr. Obama’s plans for a comprehensive peace agreement involving Israel, the Palestinians and the Arab world.

The campaign, which will include interviews with Mr. Obama on Israeli and Arab television, amounts to a reframing of a policy that people inside and outside the administration say has become overly defined by the American pressure on Israel to halt settlement construction on the West Bank.

If Obama's pressure on Israel to halt new construction in West Bank settlements was Phase 1 of his Mideast game plan, Marc Lynch says we're now moving on to Phase 2:

This, I suspect, is something very different: a strategic communications campaign designed to build support for a push towards a two-state solution among key Israeli, Palestinian, and Arab constituencies.  Reassurance, yes, but within the context of explaining the  American view of the urgency of the moment for a push towards peace — and of building support for, and even a demand for, such a push towards peace among those publics.  There are many tools which could be deployed in such a campaign — not just the television interviews mentioned in the article, but the whole portfolio of campaign outreach tools, including new media, which could be deployed in support of such a strategic objective.

Along with practically everyone else on the planet, I've been extremely non-optimistic for the past decade about the chances for some kind of Israeli-Palestinian accord.  And Obama or no Obama, I can't say that anything recently has changed my mind.  It still seems politically impossible for Israel to take any serious action on the settlements, just as it seems unrealistic to expect that Fatah and Hamas can come to any kind of agreement that allows them to effectively represent Palestinian interests.  There are distinct limits to what Obama's oratory can do, and this seems like one of them.  But I'm glad he's at least trying.

Follow the Money

Clean-energy companies have increased their K Street spending by 5x over the past couple of years.  But Bloomberg reports it's still a drop in the ocean:

Exxon Mobil Corp., the biggest U.S. oil producer, spent more on Washington lobbying during the first half of the year than all clean-energy companies combined, researcher New Energy Finance Ltd. said.

Exxon Mobil, based in Irving, Texas, spent $14.9 million lobbying in the six months, 23 percent more than the $12.1 million laid out by companies that make solar panels or wind turbines to generate electricity, London-based New Energy Finance said today in a note to clients.

The entire oil and gas industry spent $82.2 million in the first half of the year.  If you're ever wondering why the Waxman-Markey climate bill kept getting watered down so much, now you know.

Business Week has an interesting piece this week about the stigma of lobbying in the age of Obama, and how it's driving lobbyists to rethink how they do business. True to form, some of the industry's heavy-hitters have found a loophole: they've stopped calling themselves lobbyists. Obama pal Tom Daschle is now a "strategist" and "special policy adviser" on health care and finance at Alston & Bird; GOP lobbyist kingpin Ed Gillespie styles his services as "strategic planning," "message development," and "crisis management." The new jargon, of course, means that they don't have to register or disclose information about their lobbying activities. Sorry, I mean their strategizing activities.

The new terminology is convenient in another way, too: It allows Daschle to play the role of an independent expert on health care rather than someone with a direct financial stake in the legislative battle. For instance, Newsweek recently interviewed him about the issue, describing him only as Obama's failed nominee for health care czar who is now "watching from the sidelines." For his part, Daschle coyly noted that he felt "very fortunate to be able to play the role of what I would call a resource to members of Congress and to the White House and to others who are interested in public policy relating to health care."