• A Tale of Three Charts


    Actually, this is a tale of three versions of the same chart. The first one comes from John Taylor and shows fixed investment plotted against unemployment from 1990 to the present:

    This is a very striking correlation, and Taylor jumps to an immediate conclusion, namely that “the most effective way to reduce unemployment is to raise investment as a share of GDP.” Because of this, he applauds the recent move to “lighten up on the anti-business sentiment coming out of Washington.” But Justin Wolfers isn’t so sure. Why start at 1990? What happens if you use the full time series all the way back to 1948? You get this:

    Wolfers concludes that Taylor’s correlation is spurious, “advocacy, dressed up as science.” If you look at a longer timeframe, there’s virtually no correlation at all.

    But Paul Krugman thinks the 1990-2010 data is worth looking at. However, after decomposing it, he concludes that the recent plunge in fixed investment is mostly due to the collapse of the housing bubble. Business investment isn’t doing badly at all — and in any case, surely the causation runs in the other direction, with unemployment affecting investment? So he flips the axes, replots the data to look at business investment only, and then Brad DeLong dresses up the chart a bit. Here’s what he gets:

    Brad’s conclusion: not only is business investment a “bit stronger” right now than you’d expect from the data, it’s “substantially stronger. 2% of GDP stronger — that’s $300 billion a year more in business investment than we would have expected to see with the unemployment rate this high.”

    Interesting! But I have an entirely different question. First: why did the correlation change so dramatically right around 1990 or so? Second: why did it apparently change again right around 2009? Brad attributes the 2009 break to changes in policy:

    Had there been no fiscal and banking rescue policies and if investment had not been boosted by policy, the unemployment rate might as a result be at the 16% of the Blinder-Zandi Republican policy baseline, and only THE ONE WHO IS knows how low business investment spending would be — but it would surely be a lot lower than it is now.

    But what about the break around 1990? What accounts for that? Or, perhaps more pertinently, what was it about 1990-2007 that was different from both the period before and after?

    UPDATE: Possible answer here!

  • Obama and Global Warming, Part 2


    Is the Obama administration willing to sell out the EPA in order to get a budget deal, as the AP reported yesterday? Greg Sargent gets a statement from the White House that says it’s not:

    As the administration has made clear, the funding bill should not be used to further unrelated policy agendas, and we remain opposed to riders that do that, including as it relates to the environment.

    That’s not exactly the most Shermanesque kind of denial I’ve ever seen, but still good to hear. Plus, as Greg says:

    As a side note, even Republicans I’ve spoken with privately concede that they’re well aware that it’s unlikely that the latter is a concession they could win, since it would be very hard for many Congressional Dems to support any budget deal containing it.

    More later as this develops.

  • Wall Street and the Public


    Matt Yglesias points us to today’s Financial Times’ report on Jamie Dimon’s latest predictions of doom for big finance:

    Jamie Dimon, chief executive of JPMorgan Chase, launched a broadside against financial regulation on Wednesday, warning that new capital rules could be “the nail in our coffin for big American banks”.

    ….Restrictions on debit card fees charged to retailers are also coming under attack in Congress….“It basically penalises us for having debit cards,” he said. “I think it was very unfairly done in the middle of the night with no facts and analysis whatsoever. This is not the way legislation should be done.”

    Attacking another aspect of Dodd-Frank, Mr Dimon said rules requiring companies to put up collateral as they trade derivatives would “damage America”. Gesturing at the chief executive of Caterpillar, Mr Dimon predicted the industrial company would take its derivatives business to Singapore.

    So Dimon doesn’t like higher capital rules, doesn’t like derivatives regulation, doesn’t like debit card rules, and we already know what the entire industry thinks of the new Consumer Finance Protection Bureau. Long story short, he doesn’t really think the financial industry needs any new regulations at all, thankyouverymuch.

    Well, if I were him I suppose I wouldn’t think so either. But guess what? It’s only been two years since the Great Collapse, and finance industry profits have already rebounded to their bubble-era levels. That’s a strong sign that finance industry leverage is also returning to its bubble-era levels, which in turn means the industry is about as dangerous as it’s ever been. And Dodd-Frank is a notably weak piece of regulation, about as weak as any bill could be and still be called regulatory reform in the first place. Wall Street got off easy, and Dimon knows it.

    The FT suggests that the growing pushback against regulation is coming as “anger at the financial industry subsides.” Matt disagrees:

    Personally, I see absolutely no reason to believe that anger at the financial industry has subsided. The Obama administration was softer on the financial industry than the public wanted, which played into the hands of the other political party. In an ideal world voters would have realized that the other political party wants to be even softer on the financial industry. But in the real world, that’s not how it worked. But I think most people are still pretty damn angry at the financial industry and don’t at all agree with Rep Bachus that the proper role of US public policy is to serve the bankers.

    Unfortunately, I think the FT is right: the fact is that the public was never really all that angry at the financial industry in the first place. Tea party anger toward TARP has been mainly directed at the government, not at the financial industry. And the occasional protest against AIG bonuses aside, there’s simply never been any real, concerted attack on the financial industry from either left or right. On a scale of 1 to 10, with the healthcare fight rating a 9, I’d say that anger toward banks rates about a 3. That’s why Congress has been able to get away with doing so little about it.

    Years ago I remember a lot of moderate liberals talking about how the Bush era radicalized them. For me, it was the economic collapse of 2008 that did it. The financial industry almost literally came within a hair’s breadth of destroying the world, but even so it took only a few short months for them to close ranks with Republicans and the rich to prevent anything serious being done to rein them in. Profits are back up, new regulations are barely more than window dressing, nothing was done to help underwater homeowners, bonuses are as obscene as ever, unemployment remains sky high, and the public has somehow been convinced that this was all their own fault — or perhaps the fault of big government, or big deficits, or something. But the finance industry has escaped almost entirely unscathed. It’s mind boggling. If this doesn’t change your view of who really runs the world, I don’t know what would.

  • Good News for Preemies


    Here’s some good news for you. Remember a few weeks ago I wrote a post about a drug that helps prevent premature births? For years, a generic version was widely available from compounding pharmacies for about $10 per shot, but then, based largely on studies performed by the federal government, Hologic Inc. won approval of a branded version of the drug. It promptly sold the marketing rights to K-V Pharmaceutical, which jacked up the price overnight to about $1,500 per shot:

    Then K-V sent letters to pharmacies threatening that the FDA would punish them if they compounded their own versions of the drug. On Wednesday, the FDA declared it would do no such thing.

    In its statement, the FDA noted that the drug was important and K-V “received considerable assistance from the federal government in connection with the development of Makena by relying on research funded by the National Institutes of Health to demonstrate the drug’s effectiveness.”

    ….”In order to support access to this important drug, at this time and under this unique situation, FDA does not intend to take enforcement action against pharmacies that compound [Makena] based on a valid prescription,” the agency said in a statement.

    That’s from the Los Angeles Times. It’s not the end of the story, since I assume that K-V will now bring its legal and lobbying muscle to bear in defense of its outrageous pricing. But it’s a good start.

  • Further Evidence on the Crazification Factor


    The latest CNN poll says that unfavorable views of the tea party have surged by more than 20 percentage points over the past year:

    Nearly half of all Americans have an unfavorable view of the tea party movement….A CNN/Opinion Research Corporation survey released Wednesday indicates that 32 percent of the public has a favorable view of the two year old anti-tax movement.

    Hmmm. Unfavorables are up and favorables are down, but still, 32% of the country continues to have a positive view of the tea partiers. I wonder what the floor on that number is? I’m going to take a wild guess and say that it’s 27%.

  • Is Obama Giving Up On Global Warming?


    AP is reporting that congressional leaders and the White House are working on a compromise budget plan that would cut $33 billion in spending. I’m a little surprised that John Boehner might be on board with this, since I figure he has to allow a government shutdown before eventually compromising if he wants to retain any credibility at all with the tea party wing of the GOP. But maybe he’s decided that going through with the shutdown kabuki is pointless because the tea partiers are uncompromising zealots who can’t be appeased no matter what. If that’s the case, then the $33 billion figure is no big surprise.

    But what’s up with this?

    A Democratic lawmaker familiar with a meeting Wednesday between Obama and members of the Congressional Black Caucus said the administration made it clear that some House GOP proposals restricting the Environmental Protection Agency’s regulatory powers would have to make it into the final bill….It’s not clear which proposals the White House might accept, but those backed by Republicans would block the government from carrying out regulations on greenhouse gases, putting in place a plan to clean up the Chesapeake Bay and from shutting down mountaintop mines it believes will cause too much water pollution.

    These kinds of leaks often turn out to be mistaken in one way or another, so it’s probably best not to panic yet. On the other hand, it’s notable that Obama barely even mentioned climate change or greenhouse gases in his big energy speech today. This concession to Republicans on the EPA would jibe with that, and if it’s true it would mean that Obama has essentially given up completely on anything other than token action to address global warming. That should sure get the base amped up for 2012, shouldn’t it?

  • The Power Politics of Left and Right


    Back during the brief period when Democrats controlled 60 seats in the Senate, they could have rammed through a bill to grant statehood to Washington DC. This would have guaranteed them two extra Democratic senators and at least one extra Democratic House member. So why didn’t they do it? Jonathan Bernstein suggests that it demonstrates a core difference between the parties:

    I think perhaps the reason is that for whatever reason, in recent years Republicans have tended to use their best legislative and executive chances to secure long-term electoral advantages, while Democrats have tended to use theirs to enact substantive policy…..The point here isn’t that the Democrats are especially spineless (or that Republicans are especially ruthless) — it’s that they (may) think about, and use, power differently.

    ….Speaking of which…this also explains another of this blog’s hobbyhorses, the GOP certainty that Democrats are going to re-instate the Fairness Doctrine in order to shut down Rush Limbaugh and other conservative radio hosts. If it’s true that conservatives do think as Drum and I have speculated, then their belief is explained because they know that that’s what they would do if they were in a similar situation. And guess what? As soon as they gained a majority in the House (at least this time around), conservatives moved quickly to defund NPR, which they see as the liberal alternative to conservative talk radio.

    This is, more or less, an answer to my question about longtime Republican efforts to defund the left: the reason that Democrats don’t do the same thing is because they’re more interested in passing substantive policy, and there’s only so much bandwidth available to them. If you spend all your time on policy, you just don’t have time to do a lot of other stuff.

    I’m not sure I buy this entirely, since defunding activities are often pursued by different actors than policy activities. Still, it’s an interesting notion, and one that jibes with something I’ve heard repeatedly on the funding side as well: conservative donors are generally eager to fund overtly political activities, while liberal funders are more interested in funding things they consider worthy endeavors. (And more likely to want lots of control over and accountability from the things they fund.) Food for thought.

  • Obama’s New Energy Snooze


    Unfortunately, it’s difficult to disagree with the Economist correspondent who wrote this about the energy proposal President Obama unveiled today:

    It is hard to see his half-baked, reheated list of proposals as anything more than a reassurance to the environmentally-minded, and to Americans fretting about rising fuel prices, that the president feels their pain — unlike those nasty Republicans.

    The proposal itself is pretty pedestrian, and in any case has zero chance of being approved by Congress. More details at the link, as well as from Ezra Klein and Stuart Staniford. Overall, it’s hard to work up the enthusiasm even for a lengthy blog post about this, let alone anything more.

  • Crazytown Just Keeps Getting Crazier


    A growing swath of conservatives apparently thinks that states can seize control of all federal healthcare spending just by banding together and getting Congress to agree. They also apparently believe that states can require taxes to be paid only in gold or silver bullion. What’s next? Now they believe that the House can pass its own budget, H.R. 1, without agreement from either the Senate or the president:

    House Majority Leader Eric Cantor (R-Va.) said at a press conference that Republicans would consider the Government Shutdown Prevention Act on Friday. The bill would make H.R. 1 law if the Senate fails to pass a measure “before April 6” to fund the government for the rest of the fiscal year.

    ….“We’re serious. We want to take care of this problem so we can get on about the business of this nation and get Americans back to work,” Cantor said.

    By Republican standards, I guess this actually does count as serious. But that says more about modern Republican standards than it does about the meaning of the word “serious.”

  • Countervailing Powers


    David Leonhardt on Fed policy:

    Whenever officials at the Federal Reserve confront a big decision, they have to weigh two competing risks. Are they doing too much to speed up economic growth and touching off inflation? Or are they doing too little and allowing unemployment to stay high?

    It’s clear which way the Fed has erred recently. It has done too little….Why is this happening? Above all, blame our unbalanced approach to monetary policy.

    One group of Fed officials and watchers worries constantly about the prospect of rising inflation, no matter what the economy is doing. Some of them are haunted by the inflation of the 1970s and worry it may return at any time. Others spend much of their time with bank executives or big investors, who generally have more to lose from high inflation than from high unemployment.

    There is no equivalent group — at least not one as influential — that obsesses over unemployment.

    Hmmm. A big, powerful, influential group that obsesses over unemployment. Sounds like a great idea. But I wonder what kind of group that could possibly be? Some kind of organization of workers, I suppose. Too bad there’s nothing like that around.

  • Supreme Court: Withholding Evidence Now Officially OK


    Today I have the unfortunate job of following up on the case of John Thompson, who was sent to death row in 1985 after a New Orleans DA deliberately withheld evidence showing that Thompson’s blood type didn’t match a previous crime he’d been convicted of, and also deliberately withheld various other pieces of evidence that exonerated Thompson of the murder he was charged with. After the murder charges were eventually tossed out, a court awarded him $14 million in civil damages, but on Tuesday the Supreme Court overturned the award:

    In rejecting the judgment, Justice Thomas described the case as a “single incident” in which mistakes were made. He said Thompson did not prove a pattern of similar violations that would justify holding the city’s government liable for the wrongdoing. Chief Justice John G. Roberts Jr. and Justices Antonin Scalia, Anthony M. Kennedy and Samuel A. Alito Jr. joined to form the majority.

    There were at least four other prosecutors who knew about the blood test, as well as a number of other cases like this one in New Orleans through the years. Nonetheless, Clarence Thomas figures this was just a single bad apple. Move along folks, nothing to see here.

  • Quote of the Day: “With Notably Rare Exceptions….”


    From Alan Greenspan:

    Today’s competitive markets, whether we seek to recognise it or not, are driven by an international version of Adam Smith’s “invisible hand” that is unredeemably opaque. With notably rare exceptions (2008, for example), the global “invisible hand” has created relatively stable exchange rates, interest rates, prices, and wage rates.

    Henry Farrell comments:

    It’s best not to interpret this as an empirical claim, but a carefully-thought-out bid for Internet immortality. It has the sublime combination of supreme self-confidence and utter cluelessness of previously successful memes such as “I am aware of all Internet traditions” and the “argument that has never been made in such detail or with such care,” but with added Greenspanny goodness. I tried to think of useful variations on the way in to work this morning — “With notably rare exceptions, Russian Roulette is a fun, safe game for all the family to play,” and “With notably rare exceptions, (the Third Punic War for example), the Carthaginian war machine was extremely successful,” but none do proper justice to the magnificence of the original. But then, that’s why we have commenters.

    Quite so. But what makes this even worse than it seems (if that’s possible) is that 2008 is hardly the only notable exception to global economic stability since the globalization and deregulation of finance began in earnest three decades ago. While they’re playing Henry’s game, commenters might also want to spare a few moments to recall some of the other slightly lesser catastrophes that Greenspan rather blithely passed over.

  • Should Mitch Daniels Run?


    Joe Klein is unhappy:

    This is my 10th presidential campaign, Lord help me. I have never before seen such a bunch of vile, desperate-to-please, shameless, embarrassing losers coagulated under a single party’s banner. They are the most compelling argument I’ve seen against American exceptionalism.

    ….There are those who say, cynically, if this is the dim-witted freak show the Republicans want to present in 2012, so be it. I disagree. One of them could get elected. You never know. Mick Huckabee, the front-runner if you can believe it, might have to negotiate a trade agreement, or a defense treaty, with the Indonesian President some day. Newt might have to discuss very delicate matters of national security with the President of Pakistan. And so I plead, as an unflinching American patriot — please Mitch Daniels, please Jeb Bush, please run. I may not agree with you on most things, but I respect you. And you seem to respect yourselves enough not to behave like public clowns.

    I don’t know about Jeb, but I agree that Mitch Daniels seems like he ought to be a decent candidate. He’s a genuine conservative, not a RINO sellout, but also not a wingnut. He’s a midwesterner, has experience in the Bush administration, and commands a fair amount of establishment respect. Not my cup of tea, obviously, but his background ought to be appealing to a fair number of Republicans.

    But the usual question remains: how does he get through the primaries? When he hops over to Iowa, they’ll expect him to denounce sharia law, make jokes about Obama’s Kenyan birth, throw himself wholeheartedly into the culture wars, pretend that global warming is a liberal conspiracy, and make dire remarks about the specter of socialism taking over America. In other words, he’ll have to act like a public clown, and if he doesn’t do it, he’ll lose.

    So it’s pretty much a no-win scenario for him. If he’s smart, he’ll wait for 2016 and hope that the Republican Party has come to its senses by then.

  • Quote of the Day: Pawlenty on Cap-and-Trade


    From Tim Pawlenty, possibly the most boring person ever to be considered a front runner for a presidential nomination:

    Anybody who’s going to run for this office who’s been in an executive position, or may run, has got some clunkers in their record. Laura, mine I think are fewer and less severe than most. As to climate change, or more specifically cap-and-trade, I’ve just come out and admitted it — look, it was a mistake, it was stupid….Everybody in the race, well at least the big names in the race, embraced climate change or cap-and-trade at one point or another. Every one of us.

    That’s true. And then, suddenly, every one of them didn’t. Why is that?

    One possibility is that they just like taking stands that piss off liberals. But opposing cap-and-trade would have pissed off liberals four years ago and they didn’t do it then. So what changed?

    The answer isn’t very complex. Four years ago, in the wake of Al Gore’s Inconvenient Truth and growing public concern about global warming, corporate America felt that some kind of action on greenhouse gases was probably inevitable. And if it was inevitable, then cap-and-trade was their best bet. From their point of view it probably looked less threatening than a flat carbon tax, which is harder to game than cap-and-trade, and less costly than flat mandates from the EPA. So they got on board, and Republicans got on board with them.

    But then a couple of years ago public concern over global warming started to wane and it became less obvious that action on greenhouse gases really was inevitable. So instead of settling for cap-and-trade as their least worst alternative, they decided to fight instead for their first best alternative: doing nothing. And once again, Republicans got on board with them.

    All this was made easier by the fact that the conservative wing of the GOP was never a fan of regulating greenhouse gases in the first place, and when John McCain lost the 2008 election it was easy to demonize squishy stands like his support of cap-and-trade as evidence that America had no interest in Democrat-lite policies. If corporations had continued to support cap-and-trade, there could have been a real tug-of-war between the business wing of the party and the Obama-is-a-socialist wing of the party, but once the business community jumped ship it was no contest. They usually get what they pay for, after all.

  • Obama the Socialist


    Fox News VP Bill Sammon told a conservative audience last year that he engaged in a wee bit of fabrication during the 2008 campaign:

    At that time, I have to admit, that I went on TV on Fox News and publicly engaged in what I guess was some rather mischievous speculation about whether Barack Obama really advocated socialism, a premise that privately I found rather far-fetched.

    Today he explains himself to Howard Kurtz:

    He doesn’t regret repeatedly raising it on the air because, Sammon says, “it was a main point of discussion on all the channels, in all the media” — and by 2009 he was “astonished by how the needle had moved.”

    Actually, no: I don’t think it was a “main point of discussion” on all the channels. It was a main point of discussion on Fox News. On the other channels it was mainly treated as something ridiculous that Fox was promoting.

    As for Sammon’s moving needle, Greg Sargent sums things up: “Sammon is conceding that the idea did indeed strike him as far fetched in 2008, even though he and his network aggressively promoted it day in and day out throughout the campaign. And he’s defending this by pointing out that the idea ended up gaining traction, as if this somehow justifies the original act of dishonesty!”

    Which, of course, it does. All Sammon was doing was creating a new reality, which the rest of us merely get to study judiciously. And while we’re studying it (and mocking it), Fox will create another new reality. This is the way the empire works these days.

  • Obama’s Speech


    I’ve been under the weather for the past few days, so I missed Obama’s big Libya speech yesterday. I meant to watch it, but then I fell asleep on the couch and by the time I woke up it was over. But I’ve since read the text of the speech, and I basically agree with Fred Kaplan: it was “about as shrewd and sensible as any such address could have been.” A little messy, perhaps, but we live in a messy world:

    Obama’s main point was this: When, as he put it, “our interests and values are at stake,” and when taking military action a) carries few risks, b) costs little, and c) may reap huge benefits, both political and humanitarian, then such action is worth taking even if the interests involved aren’t quite vital.

    This formulation is unsatisfying, both to the Realists (who shy from using force except in pursuit of vital interests and, even then, only when the outcome is fairly certain and preponderant force is mustered) and to the neoconservatives (who leap to use force anywhere and everywhere in the cause of universal moral values). But it reflects a sense of realism with a small r.

    Clive Crook seems to find this likewise a bit unsatisfying, but suggests that, like democracy, Obama’s approach produced the worst possible policy except for all the others:

    If you doubt it, don’t just list the policy’s all too obvious dangers: test it against the alternatives — something I have not seen Obama’s critics do. One option would have been to do nothing. In other words, abstain with China and Russia on the UNSC resolution. What a splendid message to the world that would have sent. Or maybe vote for the resolution, then commit no resources to enforcing it–the usual European approach to global leadership. Thankfully, the US is better than that. Alternatively, go all in, make regime change the goal, and target Gaddafi–but now without international backing. That would have been a heavier burden and an even bigger gamble. The course of action Obama chose is risky, to be sure, but when you think them through the alternatives look worse.

    In the end, Obama will be judged on whether his approach works. If U.S. involvement really stays limited; if Qaddafi finds himself out of a job within a few weeks; and if the aftermath of the war isn’t too disastrous, then Obama will be vindicated, congressional approval or not. If any of these things doesn’t happen — and I’d pay particular attention to the last of them — he’ll be in trouble. As with all things, success justifies nearly anything.

  • Avoiding the Conservative Rabbit Hole


    Mike Konczal says that by now he understands pretty much all of the pro and con arguments related to the financial reform bill:

    But at this point I simply no longer understand the hysterical, off-reality, arguments conservatives, especially the Wall Street Journal’s editorial page, are making about the Consumer Financial Protection Bureau. Again, if they wanted to argue the meta-level, bring it on. If they think the problem is, a la Phil Gramm, predatory borrowers, say it. If they are freaked out about cost of capital going higher, make that case. I’ve written that the previous attempts to make that case are quite amateur, but I’d love to hear new ones. Anything, really, and I’ll give it a fair listen.

    Don’t hold your breath, Mike. The CFPB is opposed by banks because it will probably make them slightly less profitable, and conservatives, in turn, oppose it because banks oppose it. Looking any further is just a fool’s errand.

  • Taking Aim at the Poor


    This is an oddly fascinating quote from a GOP staffer:

    Republicans are poised to reject a White House offer, TPM has learned, that would cut over $30 billion in current spending because of disagreements over whether the package should include cuts to mandatory spending programs. Democrats are pushing for such cuts, which include the big entitlement programs, though the specific cuts they’re proposing remain unclear. In an ironic twist, Republicans oppose those cuts and want to limit the negotiations to non-defense discretionary spending, a smaller subset of the federal budget.

    ….Asked about the offer the White House has floated, a top Republican aide says, “This debate has always been about discretionary spending — not autopilot ‘mandatory’ spending or tax hikes.”

    This isn’t a big surprise or anything, but I’ve never seen it put quite so baldly. This guy is literally saying that Republicans don’t want to cut spending, they only want to cut nondefense discretionary spending. That’s it. This, of course, is the one part of the budget that’s (a) too small to really matter much, and (b) includes social welfare spending for poor people. Again, no big surprise, but at least it clears up what Republicans really care about cutting. And it’s not the deficit.

  • Money Talks — And Talks, and Talks, and Talks….


    Several years ago Arizona passed a clean elections law that provides state subsidies for candidates who follow certain rules. One provision of the law states that if a subsidized candidate is running against a self-funded candidate, and the self-funded candidate spends more than the subsidized candidate, then the subsidies increase. This is meant to prevent zillionaires from massively outspending everyone else, and needless to say, zillionaires and their allies don’t like this much. Over at SCOTUSblog, Lyle Denniston summarizes the zillionaire side of the argument like this:

    The only ways a self-financed candidate could prevent the state from helping to put out the message of the subsidized candidate — a “windfall” — would be to reduce the volume of his or her own speech, or at least to rearrange the timing of the speech, with negative effect. Either of those restraints, the petitions argued, would impose the campaigning burden that the Supreme Court had found unconstitutional in the Davis case.

    The Davis case is Davis v. Federal Election Commission, in which Samuel Alito ruled against the “Millionaire’s Amendment” of the 2002 campaign finance law. That amendment created different rules for candidates who abided by spending limits vs. those who didn’t, and Alito ruled that Congress had no right to do that. Paul Waldman disagrees:

    What is the “right” at issue here? It’s not the right to free speech, since the self-financed candidate still can speak as much as he likes. It’s the “right” to have the loudest voice if you have the most money, to drown out every other voice.

    Which isn’t a right at all. It’s a privilege: the privilege of those with money to bend the political system to their will, to have the biggest megaphone, to make sure that their money gives them the ability to put a thumb on the electoral scale.

    So how is the Court going to rule? If the Roberts Court has a guiding principle, it’s that those with power should prevail. But as in all cases like this, the decision will likely come down to one man, Justice Anthony Kennedy. No one doubts that John Roberts, Samuel Alito, Antonin Scalia, and Clarence Thomas will rule in favor of the candidates who want to gut the public-financing system so that those with the most money will always have the advantage. The four liberals on the Court will probably disagree. And Kennedy will decide, most likely in favor of the plaintiffs.

    The Arizona law is now before the Supreme Court (in McComish v. Bennett), which heard oral arguments today. My guess is that Paul is right: the court will strike down the Arizona law, and this in turn will be the death knell for campaign finance reform. The Arizona law, and others like it, were very carefully crafted to remain within constitutional limits, and if a key provision is struck down it’s difficult to envision any kind of effective limits on campaign financing that the court would uphold. It’s taken them several decades, but combined with last year’s ruling in Citizens United the zillionaires are on the brink of an almost complete victory. Not only does money talk, but soon it won’t have to worry about anyone talking back either.

  • Our War in Libya


    From the New York Times:

    As rebel forces backed by allied warplanes pushed toward one of Col. Muammar el-Qaddafi’s most crucial bastions of support, the American military warned on Monday that the insurgents’ rapid advances could quickly be reversed without continued coalition air support.

    “The regime still vastly overmatches opposition forces militarily,” Gen. Carter F. Ham, the ranking American in the coalition operation, warned in an email message on Monday. “The regime possesses the capability to roll them back very quickly. Coalition air power is the major reason that has not happened.”

    In case it wasn’t already clear, the Western coalition is now providing close air support to one side in a civil war. I’m OK with that — though I’d be more OK if I knew more about the rebels we were supporting — but this is a very far cry from merely enforcing a no-fly zone. We’re fighting a war in Libya, and anyone who tries to pretend otherwise is just trying to distract you from the truth.