Kevin Drum - April 2011

Obama Brazenly Lying Once Again

| Wed Apr. 27, 2011 10:49 AM EDT

I see that even our own Tim Murphy has fallen for the White House's "long form birth certificate" scam this morning. How disappointing to see one of MoJo's own being so credulous. This "official" copy has obviously been doctored, as anyone can see clearly by looking at the bottom of the form. See line 23? "Evidence for Delayed Filing or Alteration"? If this were a true copy, it would carry an official stamp saying "None" to indicate that it hadn't been altered. But obviously the form has been altered, to remove the official evidence of alteration. This story is far from over, my friends. Far from over.

UPDATE: A reader emails to point out that Fox News is taking an appropriately skeptical stance about all this. Kudos to them. I'm glad there's at least one news organization left that doesn't just accept White House agitprop at face value.

UPDATE 2: From commenter dennisS:

     You call that a long form?! It's not even 8.5 x 11 !! I want the reeeeeallllly loooong form!!

The rest of the comments are good too!

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Is Obama a Republican?

| Wed Apr. 27, 2011 1:58 AM EDT

Ezra Klein argues today that Barack Obama is, historically speaking, a moderate Republican. On three big issues, he says, Obama has championed approaches that Republicans themselves supported only a couple of decades ago:

Take health-care reform. The individual mandate was developed by a group of conservative economists in the early ’90s. Mark Pauly, an economist at the Wharton School of the University of Pennsylvania, was one of them. “We were concerned about the specter of single-payer insurance,” he told me recently.

....The story on cap and trade — which conservatives now like to call “cap and tax” — is much the same. Back then, the concern was sulfur dioxide, the culprit behind acid rain. President George H.W. Bush wanted a solution that relied on the market rather than on government regulation. So in the Clean Air Act of 1990, he proposed a plan that would cap sulfur-dioxide emissions but let the market decide how to allocate the permits. That was “more compatible with economic growth than using only the command and control approaches of the past,” he said.

....As for the 1990 budget deal, Bush initially resisted tax increases, but eventually realized they were necessary to get the job done....That deal, incidentally, was roughly half tax increases and half spending cuts. Obama’s budget has far fewer tax increases.

This is a fairly common argument on the left, but I really think it's mistaken. What conservatives want hasn't changed all that much. They want government out of the healthcare business; they want minimal environmental regulation; and they want to keep taxes low. What has changed has been purely tactical. In the early 90s it seemed likely that Democrats could push through single-payer healthcare and a command-and-control solution to acid rain. Republicans felt like they had to have competing solutions, so they offered something a step to the right. Likewise, the 1990 tax bill was merely a compromise that Bush felt pushed into, not conservative dogma of the era. Far from it, in fact: conservatives were opposed to the deal from the start, and Bush himself repudiated it shortly after it was signed into law.

The individual mandate and cap-and-trade may have originally been "Republican" ideas in some technical sense, but they were adopted under duress. They never truly represented things that Republicans supported. The same was true of the Bush tax hike, which even at the time conservatives viewed as the work of an apostate. So it's only natural that they haven't supported any of these things under the Obama adminstration. They never really did, after all, and this time around they felt that flat-out opposition was politically feasible. So that's what we got.

That said, it's true that the GOP has moved considerably to the right over the past couple of decades. Today's crowd wouldn't vote for these things even as a disagreeable but unavoidable compromise. As Joe Klein says:

The Republican party has [...] gone off the deep end on taxes. It has denied the long-term economic and societal benefits of universal health insurance. It has gone into climate change denial...it is hard for any card-carrying Republican to say: I believe that Darwinian evolution is God’s plan.

....A hundred years from now, historians will be having a field day: How did the Republicans go so far astray? Why did it work, from time to time, electorally? Why weren’t the Democrats more effective in stopping them? Why didn’t the society’s major conservative economic stakeholders (outside the uber-reactionary Oil Patch) renounce the sideshow and demand a more reasonable brand of conservatism?

Two words immediately come to mind: Fox News. And two more words: Rush Limbaugh. And two more words: Newt Gingrich. And two more: Frank Luntz.

This is unquestionably true, and it's obviously worth trying to figure out why this rightward shift happened and how it's retained so much public support. But I still don't think it's fair to say that government-mandated health insurance, cap-and-trade, or tax hikes were truly Republican policies 20 years ago. They were merely things they felt compelled to offer as compromises to stave off even worse liberal ideas — the same way that I compromised by supporting Obama's healthcare plan last year. If I get the chance, I'll support full-fledged single-payer healthcare 20 years from now, and it won't be because I've gotten more politically radical. It'll be because I think it's politically feasible.

Skin in the Game, Continued

| Tue Apr. 26, 2011 8:05 PM EDT

The "skin in the game" theory of healthcare says that if people have to pay for medical services out of their own pocket, they'll be more careful about what they do and don't need, and this will drive down healthcare costs. A Rand study several decades ago suggested there was something to this, but there hasn't been much rigorous research beyond that. It's just too expensive to do it properly.

But another way to look at this question, if a multi-million dollar study is beyond your means, is with international comparisons. Some countries require more out-of-pocket copays than others, and if the skin-in-the-game theory is right, countries with higher average copays ought to have lower overall healthcare costs. Aaron Carroll took a look at this a few days ago, but he began by comparing raw out-of-pocket costs, which isn't really fair since it doesn't account for different living standards. A thousand dollars for an American might be less burdensome than $700 to a Spaniard, after all.

So how about looking at out-of-pocket spending as a share of GDP? That's not really right either. We want to know if out-of-pocket costs are an incentive to consume medical care more carefully, and for that we need to look at actual dollars, not percentages of GDP, since it's actual dollars that motivate people.

Our best bet, then, would be to look at actual dollar out-of-pocket costs as a percent of average income. So I emailed Aaron and asked him if he'd modify his latest chart to show this. And since we're all part of the same great healthcare chartmaking conspiracy, he womped up a nice bar chart right away. Here it is for most of the world's rich countries:

There's not a lot of correlation here. Switzerland and the U.S. both have pretty high out-of pocket costs but also have high overall healthcare expenditures. Norway and Luxembourg both have low out-of-pocket costs and high overall expenditures. Others are somewhere in between.

Roughly speaking, then, it doesn't seem like having more skin in the game translates to lower healthcare expenditures. The U.S. in particular already has pretty high out-of-pocket costs, and that hasn't stopped us from having by far the highest healthcare expenditures per person in the world. There's not much evidence that increasing out-of-pocket costs even more would bring down those expenditures, and that's without even considering the possible adverse long-term effects (namely that high out-of-pocket costs might induce people to avoid preventive care that reduces healthcare expenditures in the long run).

Different countries have different cultures and different ways of allocating costs, so a simple chart like this will never be definitive. Still, the only real evidence that high copays produce lower healthcare expenditures is that one Rand study, and it's getting kind of long in the tooth. (It was also a short-term study, had fairly low maximums, and investigated the healthcare world of the 70s, which is quite different from today's.) Done properly, making people pay more for healthcare might be a good idea, but the international evidence doesn't do much to support the notion that it would have a huge impact.

Testing For Thee, But Not For Me

| Tue Apr. 26, 2011 5:37 PM EDT

Via Matt Yglesias, here is Wisconsin Gov. Scott Walker's latest brainstorm:

Walker is proposing expanding the voucher program that currently is only available to low-income students in Milwaukee. He wants to expand the program to all of Milwaukee County and phase out the low-income qualifying ceiling. He also wants to do away with a requirement that voucher students take the same statewide achievement tests as students in public schools.

Why does Walker want to do away with the requirement that students in tax-supported voucher schools take the same tests as students in tax-supported public schools? That's easily explained. This is from four weeks ago:

Students in Milwaukee's school choice program performed worse than or about the same as students in Milwaukee Public Schools in math and reading on the latest statewide test, according to results released Tuesday that provided the first apples-to-apples achievement comparison between public and individual voucher schools.

MPS results overall showed 59% of students scoring proficient or better in reading, while 47.8% of students scored proficient or better in math. In the voucher program, 55.2% of students scored proficient or better in reading while 34.4% of students scored proficient or better in math.

Unfortunately for voucher fans, when kids all take the same test it's way too obvious that voucher schools don't really outperform traditional schools. Nor do they outperform schools in poor neighborhoods (that's the blue line in the chart). At best, they perform about the same, and at worst they perform more poorly. Not only does this undermine the case for vouchers, but it also undermines the case that, for example, it's the troglodyte teachers unions that are holding back Wisconsin's kids. That can hardly be tolerated, so the best bet is to simply not allow comparisons to be made in the first place.

On an unrelated note, this chart is a good example of the great middle school collapse that bedevils education reform. As you can see, test scores are mostly stable all the way through elementary school and, in some case, through eighth grade. Then they crash. By tenth grade, whatever gains they've made in previous grades are largely gone, and that's especially true in the urban Milwaukee district. Until we figure out what's going on here, ed reform is going to continue to founder. It's nice to have lots of high-performing sixth-graders, but the only thing that really matters is how these kids turn out in the end. So far, the answer is: not so hot.

The Future of Abortion?

| Tue Apr. 26, 2011 2:36 PM EDT

Anti-abortion groups have been busily working to push the envelope of anti-abortion law for decades, and lately they've decided to stop pushing and just shred the envelope to pieces instead. For example, Kate Sheppard reports that a Louisiana lawmaker flat out wants to make abortion illegal in his state:

State Rep. John LaBruzzo, a Republican from Metairie, has introduced a bill that would ban all abortions in his state—with no exceptions for rape, incest, or the life of the mother—and charge women who seek abortions and the doctors who perform those abortions with "feticide."

Louisiana state law calls for jail sentences of up 15 years, with hard labor, for the unlawful killing an unborn child. LaBruzzo told the New Orleans Times-Picayune that the inclusion of the line subjecting women to "feticide" prosecution for seeking abortions was a "mis-draft," and including it "would make [the bill] too difficult to pass." He promised the provision will be removed from the bill before it goes to a committee vote.

There is, of course, no logical reason why women who get abortions shouldn't be prosecuted for feticide if abortion really is murder. And they probably will be, too, if Roe v. Wade ever gets overturned, as LaBruzzo and his allies hope. After all, LaBruzzo has merely said a little more bluntly what lots of other anti-abortion have previously said more circumspectly: the only reason to exempt women from prosecution is that it would be hard to pass a bill that didn't. It's not that they don't think these women are murderers who ought to be in prison. They do. They just don't quite have the votes to make that stick yet.

But there's not much question that this is where they'd like to go. And if Anthony Kennedy ever decides that maybe Roe is bad law after all, at least a few states will end up doing what LaBruzzo wishes he could do right now.

The Roots of White Rage

| Tue Apr. 26, 2011 1:22 PM EDT

Is tea party hostility toward Barack Obama racially motivated? Some of it probably is, but this is a famously difficult and fraught question to answer. So let's ask instead: regardless of how much racial animus the conservative base harbored toward Obama in the first place, are leading conservatives eager to fan those racial flames for whatever benefit they can get from them? As Paul Waldman points out today, that question is a lot easier to answer. First, here's Rush Limbaugh on Obama:

What is obvious to me is that this guy harbors a deep resentment about all this rather than an appreciation, and this chip on his shoulder, which got a lot more on it than just this story, there's a racial component as you know, and other elements. Now he sees a need to get even with this country, or this country needs to be gotten even with itself.

This is a common trope on the right: Obama is angry at white people, anti-colonialism is at the core of that anger, and for that reason he hates America too. Here's Paul:

When Limbaugh says Obama's resentment is about race "as you know," his audience certainly does know, because they've heard it hundreds of times. I think most liberals are unaware that this message gets pounded home to white conservatives day after day, and has been since 2008. This is how something like health care reform can be fit so seamlessly into the culture war: it's big government, and that can only mean taking money from hardworking white people and giving it to undeserving, shiftless black people. That's why Limbaugh so often refers to health care reform as "reparations" — Obama, angry black man that he is, enacted it to stick it to white people in vengeance for slavery and discrimination.

Liberals look at Obama and see someone who is overly conciliatory, forever reaching out to opponents who despise him and giving up more than he should. But we shouldn't forget that a substantial portion of the population is constantly steeped in this racial poison. Nothing the president or anyone else says or does will change that.

This is why last summer's Fox-fest of xenophobia — Shirley Sherrod, the Ground Zero mosque, the New Black Panthers, anchor babies, liberation theology, etc. etc. — was so effective. It's also why all the birther nonsense is so powerful. Without the constant drumbeat of racially charged crap from the likes of Limbaugh and Glenn Beck and Dinesh D'Souza, it might just be a fringe curiosity. But with it, it gets a patina of intellectual support that turns it into a dangerous and mainstream belief.

Everybody involved in this pretends to be outraged if you point out what they're doing. But anyone with a pulse can see what's going on. And guess what? Summer is coming! There's no midterm election in the offing, so maybe Fox News will decide to cool it on the xenophobia front this year. But then again, maybe not. Nobody on the right really called them out on this last year, and there doesn't seem to be any real limit to their shamelessness. So maybe they'll try it again. It seems to be pretty good for ratings, after all.

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And Now, the Case Against a Carbon Tax

| Tue Apr. 26, 2011 12:28 PM EDT

Speaking of carbon taxes, the best argument against them probably has nothing to do with either global warming or tax policy. The best argument is: why bother? The simple form of this argument is that world production of oil is near its peak and can increase only slowly in future years. However, demand is going to stay high, especially in developing countries, and this is going to cause the price of oil to skyrocket. Or, more likely, to yo-yo up and down as oil-induced recessions give way to economic growth, which in turn raise oil prices and cause another recession, rinse and repeat. If that by itself isn't enough to spur lots of research into alternative energy sources, then a carbon tax isn't likely to make much of a difference.

For a more sophisticated and analytical form of this argument, Stuart Staniford has you covered today. His conclusion after crunching some numbers:

I think the IMF's growth projections [4% global growth per year -ed.] are seriously improbable. What is going to happen instead is that people will keep trying to grow without getting much more oil efficient, that won't work, oil prices will go through the roof, another global recession, or at least a major slowdown, will ensue, and then people will begin in earnest the work of starting to transition away from oil dependence.

I can't tell you the timing precisely. It could easily be this year, it could be next. It's even possible that some other global crisis will intervene first (like the credit crash of 2008 did). But I will say categorically that there's no way we are going to get through 2016, as the IMF projects, with business-as-usual economic growth.

This seems roughly correct to me. I think a carbon tax is a good idea anyway, since it provides revenue, helps spur research in rich countries, and might even smooth out the economic bumps a little bit. Still, if you buy this view of global petro-economics, it probably makes about the best case possible for not bothering.

UPDATE: Ryan Avent points out via Twitter that oil isn't the only source of carbon emissions, and fossil fuels like coal and natural gas are less susceptible to the boom-and-bust cycle that's likely to dominate oil in the future. So even if a carbon tax didn't have much influence on global oil consumption, it might have an effect on coal and natural gas consumption.

That's all true, and it's one reason I support a carbon tax even if we really are near peak production of oil. Bottom line: I don't think the boom-bust argument is a good case against a carbon tax, just the best case you can make.

Why Not Tax Carbon?

| Tue Apr. 26, 2011 11:55 AM EDT

If the price elasticity of oil is low, then people will cut back only modestly if the price goes up. Ryan Avent argues that (a) even a modest cut is better than nothing, and (b) higher oil prices are also a good way to spur development of alternative energy technologies. Jim Manzi isn't impressed:

Now to evaluate Avent’s argument that taxing fossil fuels is a good way to induce new technology, consider an analogy. Suppose that there is a chemotherapy drug that increases five-year survival rate for a specialized type of cancer from 10 percent to 60 percent, but with horrible side-effects. Some scientists in a couple of university labs have had some promising results with basic compounds that might or might not ultimately be precursors to a new drug that could get better increases in survival rates, and without many of the awful side effects. If you believed that improving treatment for this disease should be a major public priority, would your preferred approach be to add a large tax to chemotherapy? This is, in effect, what Avent is proposing as way to encourage the development of alternative energy technologies. I’d fund NIH research into the new alternative drug.

I don't think this analogy holds water. In the case of the drug, you have something that, even though it's imperfect, is better than nothing. In the absence of alternatives, most of us would prefer to make the bad drug as widely available as possible even if it does have horrible side effects. After all, those side effects affect only the patient, and we all assume that she can make her own decision about whether they're worth it.

That's not true when it comes to energy policy. At least, it's not true for anyone who accepts the science of global warming. For us, fossil fuel use is something that we'd like to see cut back as a positive good all by itself. This is, to restate the obvious, because the side effects of fossil fuels don't affect only the person driving his car to work. They affect everyone.

Now, it's true that carbon taxes have only a modest effect on fossil fuel use. If the IMF's estimates are correct, this is partly because even the long-term elasticity of oil is fairly low, and partly because when we cut back on oil in rich countries it immediately gets snarfed up by developing economies eager for growth. But this is why no serious environmentalist thinks of carbon taxes as anything other than one piece of a broader plan to cut back on greenhouse gas emissions — sort of like providing a tail wind for everything else that you're doing. And I think that's the best way of thinking about it. You want to fund research into alternative energy sources? Me too! But that means you need funding, and what better way to fund energy research than with a carbon tax? It not only provides the money you'll need anyway, but also helps push public demand in the direction of the very alternatives you're subsidizing.

Given that we're quite obviously going to need new taxes in the future, I have a hard time seeing the downside of a carbon tax. I mean, what would you rather tax instead? Labor? Capital? Consumption? No matter what your political preferences are, surely taxing carbon is a better bet than any of those three?

No Gay Judges, Please

| Tue Apr. 26, 2011 11:27 AM EDT

The anti-gay dead-enders in California continue to argue that it's unpossible for a gay judge to rule objectively in a case about gay marriage:

Attorneys for ProtectMarriage, the group that sponsored the 2008 ballot initiative, said in a legal motion that Chief Judge Vaughn R. Walker, who retired from the San Francisco-based district court earlier this year, had a duty to disclose his relationship and step down before deciding whether a ban on same-sex marriage violated the federal Constitution.

"Judge Walker's ten-year-long same-sex relationship creates the unavoidable impression that he was not the impartial judge the law requires," said Andy Pugno, a lawyer for ProtectMarriage. "He was obligated to either recuse himself or provide full disclosure of this relationship at the outset of the case. These circumstances demand setting aside his decision."

Roger that. Clearly the only possible unbiased ruling in this case would have been handed down by a straight judge upholding the sanctity of straight marriage. Because everyone knows that straight judges can keep their personal feelings in check but gay judges can't.

Krugman Then and Now

| Tue Apr. 26, 2011 1:16 AM EDT

Ben Wallace-Wells has a nice profile of Paul Krugman in New York magazine this month, and it's worth a read. For some reason, though, it prompted me to reread my interview of Krugman from back in 2003. Here's a snippet of our conversation that picks up at a point where we were talking about long-term economic woes and the Republican desire to slash entitlement programs:

I don't think politically you can cut those programs.

Train wreck is a way overused metaphor, but we're headed for some kind of collision, and there are three things that can happen. Just by the arithmetic, you can either have big tax increases, roll back the whole Bush program plus some; or you can sharply cut Medicare and Social Security, because that's where the money is; or the U.S. just tootles along until we actually have a financial crisis where the marginal buyer of U.S. treasury bills, which is actually the Reserve Bank of China, says, we don't trust these guys anymore — and we turn into Argentina. All three of those are clearly impossible, and yet one of them has to happen, so, your choice. Which one?

Well, how about your choice? What's your best guess?

I think financial crisis, and then how it falls out is 50-50, either New New Deal or back to McKinley, and I think it's anybody's guess which one of those it is....I don't see any noncatastrophic solution to this, I don't see an incremental stepwise resolution. I think something drastic is really going to happen.

....What happens if [] foreign countries stop buying U.S. bonds? Is this a real concern, or a tinfoil hat kind of thing?

Oh, I don't think China is going to do it to pressure us. You can just barely conceive of a situation where they're mad at us because we're keeping them from invading Taiwan or something, but more likely they just start to wonder if this is really a good place to be putting their money.

So what happens is a plunge in the dollar when they decide to stop buying and start cashing in, and a spike in U.S. interest rates. But you might also get in a situation where the interest rates the government has to pay to roll over its debt become so high that you get an accelerating problem, which is what happened in Argentina. What happened was that suddenly no one would buy Argentine debt unless they paid a twenty something percent interest rate, and everybody says, but if they have to roll over their debt at a twenty percent interest rate, there's no way they can pay that back. So the whole thing grinds to a halt and the cash flow just dries up.

....If you were king of the economy, what's the Krugman plan?

A phased elimination of all the Bush tax cuts, plus some additional taxes. I'd probably look first at some way to make the corporate profits tax actually effective again — the nominal rate is 35% but the effective rate is only 15% or so. Look at some cuts, maybe you start to talk about retirement age, and possibly some means testing of Medicare, and that's enough to bring the budget under control.

Obviously the financial crisis of 2008 has intervened since then, but I wonder how much of this still represents Krugman's current thinking?