Kevin Drum - December 2010

Quote of the Day: Skinning the Duck

| Wed Dec. 22, 2010 1:56 AM EST

From Sen. Lindsey Graham (R–SC), on the Democratic victories of the lame duck session:

When it's all going to be said and done, Harry Reid has eaten our lunch.

Munch, munch.

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Healthcare Reform and the Public

| Tue Dec. 21, 2010 9:13 PM EST

I guess I shouldn't care too much about stuff like this, but it bugs me when I get egregiously misquoted. Here is Tevi Troy in the Wall Street Journal today writing about the political disaster of healthcare reform:

Obama told wavering Democrats [that HCR] would suddenly become acceptable or even popular with the American people once it was passed. As Mother Jones's Kevin Drum put it in March, "once people get a taste of universal healthcare, they like what they see and they don't stop until the job is finished."....Alas for Obama and Drum [], it turned out that the more people tasted it, the less they liked it.

And here's what I actually wrote, in response to a question from Charles Pierce about why I thought passage of PPACA would lead to bigger and better reform down the road:

What's the argument for longer term progress? This isn't quite as black and white, but the historical evidence is pretty clear. Look at virtually every other advanced economy in the world. They started off with small programs and grew them over time. Germany spent over a century getting to universal healthcare. France started after World War II and didn't finish until 1999. In Canada, national healthcare started in Saskatchewan in 1946, spread to the other provinces over the next couple of decades, and became Medicare in 1984. The trend here is pretty obvious: once people get a taste of universal healthcare, they like what they see and they don't stop until the job is finished.

Obviously I was talking about long-term public acceptance of national healthcare after it starts getting implemented, not public reaction during a midterm election six months after passage. I might, of course, turn out to be wrong about even that, but I said what I said, not what Troy pretended I said.

But hey — there's more to this than just personal pique. There are also facts, which Troy cherry picks with abandon. I don't know whether healthcare reform was really responsible for one-third of the 63-seat loss that Democrats suffered in November, as Troy says, but I do know in general terms how public opinion toward healthcare reform has trended during the year. Kaiser has been sampling it monthly and you can see the results on the right. In April, right after PPACA passed, it was viewed favorably by a 45%-40% margin. In November, that had changed to 42%-40%. And, as we all know, attitudes toward most of the specific provisions of PPACA remain even more strongly favorable. That's not really evidence of a massive turnaround in public opinon.

Other surveys show other things, but in general healthcare reform polls favorably among Democrats and slightly favorably among independents; more favorably among the working age population than the elderly (probably due to the tsunami of Medicare demagoguing during the campaign); and modest majorities favor giving the bill a chance rather than repealing it. And, as always, the individual mandate polls badly.

In other words, the jury is still out on the political impact of healthcare reform. I'd say Democrats made a mistake by delaying implementation of most of it until 2014, and I'd also say (obviously) that Republicans are going to take a stab at repealing/defunding parts of it next year. There's no telling how that's going to play out. In the long term, though, if PPACA survives I'll stick to my prediction: once it's real and people start benefiting from it, it will become popular and the public will want it expanded. I'll check back in 2020 to see how my crystal ball panned out.

Good Teachers Wanted, Apply Within

| Tue Dec. 21, 2010 6:07 PM EST

Stanford’s Eric Hanushek reports on research he's done into teacher effectiveness:

A teacher one standard deviation above the mean effectiveness annually generates marginal gains of over $400,000 in present value of student future earnings with a class size of 20 and proportionately higher with larger class sizes.

These aren't just superstars that Hanushek is talking about, either. About 16% of teachers are one standard deviation above the mean, so these are good teachers but not necessarily sensational ones. Karl Smith is impressed:

Social value isn’t a feel good concept. Hanushek limits himself to future earnings of the students. The other big drivers are always crime reduction and public assistance reduction. So we are saying better teachers lead to higher wages, lower crime and less welfare. This is a far cry from trying to put numbers on soft factors like civic engagement.

And Reihan Salam wants more:

I do wish that someone would connect the dots and make the obvious yet important point that Rick Hess has been making for ages: shrinking class sizes over the last forty years has diluted the teacher talent pool. Had we stayed at the teacher-student ratios of the 1970s, we’d have 2.2 million public school teachers rather than 3.2 million. Know what else happened over the last 40 years? Labor market discrimination against women and African Americans declined, giving talented female and African American workers who had once gravitated to the teaching profession other options. Allowing effective teachers to take on larger classes in exchange for more pay could have a powerful positive effect. With the same compensation bill, we could pay far higher salaries.

It makes sense that we'd be paying teachers more if there were fewer of them, though I'm not sure that's how things would actually play out in the real world. However, given the lack of evidence that lower class sizes improve educational outcomes, it seems worth a try.

Still, this leaves us with the biggest question unanswered. I think lots of people are sympathetic to the idea that good teachers make a big difference, but how do we decide who the good teachers are? Or who the best teaching recruits are? Value-added results from standardized testing regimes seem to be about the best we have at the moment, and those are pretty questionable. But for a wide variety of reasons both good and bad, there's no way that we'll ever end up dedicating large sums of money to a massive social experiment in teacher selection and retention unless we're pretty sure we have this question licked.

Obviously there are plenty of other problems bedeviling education too: concentrated poverty, disaffected parents, pedagogical conflicts, etc. etc. But teacher quality comes up repeatedly, and the problem of how to actually judge teacher quality in the real world always comes up right along with it. I'm not sure what the answer is. Lots of experimentation, I suppose.

The Really Big Country Problem

| Tue Dec. 21, 2010 3:34 PM EST

Brad Plumer has a useful piece today about  Sen. Tom Coburn's "Wastebook 2010," which allegedly exposes massive amounts of waste, fraud and abuse in the federal budget. You should read it, but I want to add a separate comment.

Nearly all WFA discussions fall victim to the Really Big Country problem. That is, the United States is a really big country, which means that no matter what kind of weird pathology you go looking for, you'll always find a fair amount of it. Or, more accurately, you'll find what seems to be a fair amount but really isn't. It's why so many parents worry about their kids being snatched off the street by strangers: only about a hundred abductions a year fall into this category, which seems like a lot. But in a country of 300 million, that's actually about as big as the number of people killed each year by lightning strikes. It's incredibly rare. [See update below.]

I'd venture to guess that barely any organization in human history has managed to reduce WFA below about 2%. If you earn $50,000 a year, that means waste of $1,000. Even careful households probably piss away that much each year. If you run a million-dollar small business, it means waste of $20,000 a year. Again: even a very miserly small business probably loses that much. It's just impossible to keep track of every expenditure, monitor every employee every minute of the day, or make sure you get the best price on every possible purchase.

Probably no one would argue too much about this because these numbers are human size. An average family blows a hundred bucks a month on dumb stuff? Sure. A business with half a dozen employees makes $20,000 worth of mistakes each year? Sure. But what about a federal government that spends upwards of $3 trillion per year? The same rate of WFA amounts to $50 billion or more. Or, using the usual budget window, $500 billion over ten years. That seems like an outlandish amount, but it's actually the same 2% as everyone else.

None of this is to say that we shouldn't fight this stuff. Families should, small businesses should, and the government should. Hell, Coburn's book might be a public service. But even if we do a rip-roaring job of fighting WFA and run the cleanest government in human history, any decent investigator will still probably be able to find at least 2% waste in the system. It seems like a huge amount, but it's largely a mirage based on people getting fooled by numbers too big for human comprehension. This happens a lot in modern society.

UPDATE: This doesn't really affect the main point of the post, but I was off base on the abduction figure. It's based on a 2002 report by David Finkelhor, which estimates 115 abductions per year "perpetrated by a stranger or slight acquaintance and involving a child who was transported 50 or more miles, detained overnight, held for ransom or with the intent to keep the child permanently, or killed."

However, a definition that includes any kind of abduction, even those lasting only a few minutes or a few hours, brings the tally up to 58,000 per year — and obviously parents are concerned about these kinds of abductions too. Some of them are what you'd think of as child snatchings and some aren't, but in any case the number is far higher than 115. Using the broader definition, the odds of having your child snatched is (depending on how broadly you cast your net) one in a thousand or less, which is quite low but still nowhere near the odds of being struck by lightning.

Chart of the Day: The Ascent of Man

| Tue Dec. 21, 2010 1:57 PM EST

Here's the latest Gallup poll on what Americans think of evolution 85 years after the Scopes monkey trial. Obviously progress has been slow. But on the bright side, the hardcore creationist position has lost a bit of ground lately while straightforward evolution has shown steady gains over the past decade. The "humans evolved with God guiding" position has stayed steady, and this is the position I associate with people who basically believe in evolution but don't want to be mistaken for godless atheists—which is OK with me. All in all, then, things could be worse. I'm thinking of making that my motto for 2011.

New START Primed For Passage

| Tue Dec. 21, 2010 1:34 PM EST

From National Review editor Rich Lowry:

Republican opposition to New START is collapsing. One Senate source just told me the vote for ratification could go as high as 75. Another said, “I don’t know if it will get that high, but it’s starting to tick up there.” As the sense builds that ratification is inevitable, Republicans are lining up to get on the “right side.”

In other words, a big chunk of the Republican caucus has known all along that New START was a good treaty but was holding out for strictly partisan purposes. If it had been close, and giving Obama a black eye had been a serious possibility, they would have voted no. But with that option gone, they're willing to vote yes. It's a real profile in cowardice.

This says nothing good about the modern Republican Party. Everyone expects partisan gameplaying in Congress, but over a nuclear arms treaty with Russia? Seriously?

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Winners and Losers

| Tue Dec. 21, 2010 1:24 PM EST

Luke Johnson runs down the results of House districts gained and lost thanks to the latest census results:

Texas, where Republicans have a supermajority in the House and Senate and hold the governor’s mansion, gained four new House seats....Florida gained two seats....Arizona, Georgia, Nevada, South Carolina, Utah and Washington all gained one seat.

New York and Ohio lost two seats each, representing the longstanding decline in growth in the Rust Belt. Iowa, Illinois, Louisiana, Massachusetts, Missouri, New Jersey and Pennsylvania all lost one seat.

Michigan lost a seat too, according to Aaron Blake. Everyone else held their ground.

Stopping the Next Meltdown

| Tue Dec. 21, 2010 1:05 PM EST

Tyler Cowen is skeptical that vigilant bondholders can motivate banks to decrease their risk exposure. He's got a bunch of reasons that I agree with, including regulatory capture, the opacity of bank trading books, and the impossibility of making a no-bailout policy credible. But there's also this:

The net risk of a bank position is not determined solely by the bank's portfolio. Say a bank lends money to homeowners and then those homeowners increase their leverage. The bank is now in a riskier position, and de facto a more leveraged position, althoug it's measured leverage hasn't gone up a whit.

I think this gets to the heart of things. It's not practical to micromanage risk-taking in the financial sector, nor is it feasible to eliminate bubbles and bank crises entirely. But I really do believe that we could very substantially reduce the risk of bank crises without affecting the efficiency of legitimate banking operations. The way to do it is with very simple, very blunt leverage restrictions that apply to all financial actors over a certain size: banks, insurance companies, hedge funds, private equity, you name it. If you have assets over, say, $10 billion, then the rules kick in. Strict leverage limits (say, 10:1 or maybe 15:1) based on conservative notions of both assets and capital would be a pretty effective bulwark against excessive risk taking but wouldn't seriously interfere with the basic asset allocation function of the financial industry.

It wouldn't be perfect. Nothing is perfect. But if we got obsessed with leverage the same way that, say, the Fed is obsessed with inflation, we could all sleep a lot easier at night. Dodd-Frank and Basel III have gotten us part of the way there, but almost certainly not far enough. Maybe after the next global meltdown we'll finally do the job right.

Lame Duck Not So Lame After All

| Mon Dec. 20, 2010 6:52 PM EST

From The Hill:

Republican senators say privately they expect the Senate to ratify the New START treaty this week, which would hand President Obama his third major victory of the lame-duck session.

GOP senators — including those who plan to vote for the treaty and those who say they’ll oppose it — have told The Hill they expect it to pass easily. At least eight Republican senators have announced they either will vote to ratify the treaty or are leaning strongly toward doing so.

Hmmm. So Obama will have a tax deal, repeal of DADT, a food safety bill, approval of New START, and (maybe) the 9/11 first responders bill to his credit during the lame duck session. On the downside, the DREAM Act and the omnibus budget bill failed.

If this is how things turn out, that's a helluva lame duck session. Maybe we should have more of them?

Counterterrorism and You

| Mon Dec. 20, 2010 3:56 PM EST

Dana Priest and William Arkin have a big piece in the Washington Post today about the vast expansion of local counterterrorism efforts in the United States since 9/11. An excerpt:

At the same time that the FBI is expanding its West Virginia database, it is building a vast repository controlled by people who work in a top-secret vault on the fourth floor of the J. Edgar Hoover FBI Building in Washington. This one stores the profiles of tens of thousands of Americans and legal residents who are not accused of any crime. What they have done is appear to be acting suspiciously to a town sheriff, a traffic cop or even a neighbor.

....[For example, there's the question of whether a] man snapping a picture of a ferry in the Newport Beach harbor in Southern California simply liked the way it looked or was plotting to blow it up.

Suspicious Activity Report N03821 says a local law enforcement officer observed "a suspicious subject . . . taking photographs of the Orange County Sheriff Department Fire Boat and the Balboa Ferry with a cellular phone camera." The confidential report, marked "For Official Use Only," noted that the subject next made a phone call, walked to his car and returned five minutes later to take more pictures. He was then met by another person, both of whom stood and "observed the boat traffic in the harbor." Next another adult with two small children joined them, and then they all boarded the ferry and crossed the channel.

All of this information was forwarded to the Los Angeles fusion center...[where] it would immediately be entered into the Guardian database, at which point one of three things could happen:

The FBI could collect more information, find no connection to terrorism and mark the file closed, though leaving it in the database.

It could find a possible connection and turn it into a full-fledged case.

Or, as most often happens, it could make no specific determination, which would mean that Suspicious Activity Report N03821 would sit in limbo for as long as five years, during which time many other pieces of information about the man photographing a boat on a Sunday morning could be added to his file: employment, financial and residential histories; multiple phone numbers; audio files; video from the dashboard-mounted camera in the police cruiser at the harbor where he took pictures; and anything else in government or commercial databases "that adds value," as the FBI agent in charge of the database described it.

Definitely read the whole thing. But here's one thing to keep in mind as you read: in the great debate over body scanners at airports recently, one of the most popular lines of criticism was that counterterrorism efforts should rely more on intelligence and police work and less on physical security. And maybe so. But at ground level, this is what intelligence and police work looks like: having your name stored in a central FBI database for years because you took a picture of the world's smallest ferry boat.

This isn't necessarily wrong. Maybe it's the price of living in the modern world. But it is what it is, and it's what we get if we insist in ramping up intelligence and police work to keep tabs on potential terrorists. We also, apparently, get legions of newly minted terrorism trainers like Ramon Montijo: "What he tells them is always the same, he said: Most Muslims in the United States want to impose sharia law here." Lovely.

So: more porno scanners or more local intelligence? Or both? Or neither? There don't seem to be a lot of easy choices here.