Kevin Drum - July 2012

Inside the Washington Political Class

| Tue Jul. 24, 2012 2:19 PM EDT

In the New York Times Magazine last week, Mark Leibovich profiled Terry McAuliffe, the Democratic super-moneyman known as "The Macker":

The Washington Political Class, as it’s called by those in the media who are often a part of it, represents a vast and self-perpetuating network of friendships and expedient associations that transcend even the fiercest ideological differences. Membership in the class is the paramount commonality between the various tribes — the journalists, the Democrats, the Republicans, the superlawyers, superlobbyists, superstaffers, fund-raisers, David Gergens, Donna Braziles and Karl Roves. They argue on television and often go into business with their on-air combatants. They can be paid tens of thousands of dollars to do their left-right Kabuki thing in front of big organizations. The Macker did this with Rove a while back — a luncheon speech at the Exxon Mobil headquarters in Texas. He has a few joint events planned with Barbour for the fall. He has also done partisan duets at a combined 50 grand a pop with “my great friend, Eddie Gillespie,” a Barbour protégé and former R.N.C. chairman whom McAuliffe bonded with in the greenroom between their many on-air donnybrooks over the last decade. “I have a love-hate relationship with Terry,” Gillespie joked in one of their public debates. “I love Terry. And I hate myself for it.”

I missed this when it came out, but a friend brought it to my attention today. "Reading this is like reading The Valachi Papers," he says. Click the link and decide for yourself.

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Fantasy Republicans vs. Real-World Republicans

| Tue Jul. 24, 2012 1:58 PM EDT

Betsey Stevenson and Justin Wolfers argue that it's a "standard Republican talking point" that the Obama stimulus failed. As an ad from the National Republican Senatorial Committee put it, "Zero jobs, zero jobs, zero jobs were created." Reihan Salam comments:

Note the importance of defining “the standard Republican talking point” as “it didn’t reduce unemployment.” Having encountered many criticisms of the stimulus, I can attest that while many people did indeed embrace this strong form of the critique, i.e., that it did not reduce the jobless rate relative to a counterfactual in which the stimulus law was not passed, others relied primarily on the notion that the benefit did not exceed the cost.

Among the commentariat, Salam is probably right — though even there, I don't recall seeing a whole lot of examples of this. But have any actual working politicians on the right ever said this? I can think of dozens of examples of Republican politicians insisting that the stimulus didn't create one single job, but I can't think of any Republican politician on the national stage who took a more moderate line, acknowledging that jobs were created but at too high a cost. Even among the scribbling class, the folks who tried to show that the cost per job was too high usually did it with a caveat: "even if you accept CBO's figures etc...." They never said they actually did accept those figures.

This is one of the key differences between Democrats and Republicans. Both sides have a moderate wing, even if it's pretty small on the GOP side. But among politicians themselves, the Republican moderate wing simply has no influence. It's just an ineffectual knitting circle. For better or worse, there were plenty of Democrats who voted for the PATRIOT Act, supported the Iraq war, voted for the bankruptcy bill, and so forth. But where are the Republican members of Congress who supported the stimulus or healthcare reform or Dodd-Frank or student loan reform? You can count them on one hand. It's all very well to say that there were "others" who took a moderate line on the stimulus, but the truth is that they never had any real-world impact. In the real world, "zero zero zero" has been pretty much the unanimous Republican line.

Pennsylvania: No In-Person Voter Fraud Either Now or Anytime in the Past

| Tue Jul. 24, 2012 12:51 PM EDT

Here's a pretty remarkable document. It comes via TPM's Ryan Reilly, and it's an agreement between both sides in a suit filed against Pennsylvania's new voter ID law. Supposedly, these laws are designed to reduce voter fraud, but the only kind of fraud that voter ID addresses is in-person fraud: the kind where someone walks into a polling place and pretends to be someone else. And yet, the state of Pennsylvania says they have no knowledge of such fraud ever occurring, or any expectation that it will occur in the future:

In a way, there's less here than meets the eye. The state's attorneys merely want to argue that the voter ID law is constitutional, and they probably think they can do this without any evidence of actual fraud. After all, in the Crawford case the Supreme Court upheld Indiana's voter ID law even though the majority opinion conceded that "the record contains no evidence that [] in-person voter impersonation at polling places has actually occurred in Indiana." Pennsylvania's lawyers probably figure this means they don't need any evidence either, and as lawyers that's all they care about.

Still, it's sort of a remarkably bald admission. The truth is that voter fraud is vanishingly rare in the United States, and in-person voter fraud is all but nonexistent. Everyone knows this, including the courts. That's not why Republican legislatures pass these laws.

Adventures in Conservative Denialism, Part 73

| Tue Jul. 24, 2012 12:15 PM EDT

I would really appreciate it if someone could put me into suspended animation for the next few months and wake me up on November 5th. Thanks very much.

Why? Because I'm not sure I can take another 14 weeks of this campaign. The mountain of idiocy building up around "you didn't build that" has just about reached wrist-slitting proportions, both because of the sheer rapturous levels of dishonesty surrounding the quote itself and because of the ensuing, more intellectually-minded dishonesty that's now dedicated to proving that the government has never done anything for anybody — not no how, not no way. The latest is Gordon Crovitz, who has decided to see if he can con the Wall Street Journal's readership into believing that government research dollars had virtually nothing to do with the invention of the internet:

It's an urban legend that the government launched the Internet....By the 1960s technologists were trying to connect separate physical communications networks into one global network—a "world-wide web." The federal government was involved, modestly, via the Pentagon's Advanced Research Projects Agency Network....Robert Taylor, who ran the ARPA program in the 1960s, sent an email to fellow technologists in 2004 setting the record straight: "The creation of the Arpanet was not motivated by considerations of war. The Arpanet was not an Internet. An Internet is a connection between two or more computer networks."

If the government didn't invent the Internet, who did?

Etc. etc. Crovitz seems to be under the peculiar impression that Xerox's invention of Ethernet was the key to the development of the internet. Whether he really believes this, or just figures his readers will believe anything, is hard to say. In any case, Crovitz liberally quotes from Dealers of Lightning, a history of Xerox PARC by Michael Hiltzik, and thanks to the invention of the internet Hiltzik himself can set the record straight:

Crovitz confuses AN internet with THE Internet. Taylor was citing a technical definition of "internet" in his statement. But I know Bob Taylor, Bob Taylor is a friend of mine, and I think I can say without fear of contradiction that he fully endorses the idea as a point of personal pride that the government-funded ARPANet was very much the precursor of the Internet as we know it today. Nor was ARPA's support "modest," as Crovitz contends. It was full-throated and total. Bob Taylor was the single most important figure in the history of the Internet, and he holds that stature because of his government role.

....[Vinton Cerf and Robert Kahn] did develop TCP/IP--on a government contract! And Berners-Lee doesn't get credit for hyperlinks--that belongs to Doug Engelbart of Stanford Research Institute, who showed them off in a legendary 1968 demo you can see here. Berners-Lee invented the World Wide Web--and he did so at CERN, a European government consortium.

....As for Ethernet, which Bob Metcalfe and David Boggs invented at PARC (under Taylor's watchful eye), that's by no means a precursor of the Internet, as Crovitz contends. It was, and is, a protocol for interconnecting computers and linking them to outside networks--such as the Internet. And Metcalfe drew his inspiration for the technology from ALOHANet, an ARPA-funded project at the University of Hawaii.

So the bottom line is that the Internet as we know it was indeed born as a government project. In fact, without ARPA and Bob Taylor, it could not have come into existence.

There's more, and you should probably read the whole thing. But here's what I really don't get: Crovitz isn't just wrong, he's wrong in a laughably obvious way. No one who knows the first thing about the development of the internet would buy his story. It would be like some liberal writing a column suggesting that it's a "myth" that Democrats were responsible for widening the Vietnam war.

So why would Crovitz be willing to write something so publicly and embarrassingly false? I don't know. But that's where we are. It's become almost a game, with conservatives one-upping each other with ever more ridiculous claims to see just how far they can go. The answer, apparently, is pretty far. It's now so important for conservatives to claim that nothing good has ever come out of the federal government that they're literally willing to say anything. After all, how many of Crovitz's readers will ever read Hiltzik's response? One percent of them? Mission accomplished.

NOTE: One of the things that gets me about this nonsense is how one-sided it is. Can you imagine a liberal writing a column claiming that private industry played virtually no role in the development of the internet? I can't. We often cite the internet as an example of government support for basic research and infrastructure, but we'd never pretend that private industry didn't play a big role too.

Yes, the Social Sciences are Pretty Useful. Here's Proof.

| Tue Jul. 24, 2012 11:32 AM EDT

I've written before about the value of early childhood interventions, including not just pre-K schooling, but also things like home nursing visits that begin at the moment of birth. One of the reasons that more and more people are starting to focus on this is because of the results of the Bucharest Early Intervention Project, in which a group of Romanian orphans were randomly assigned either to foster homes or to remain in their orphanages. The Romanian children are now entering their teen years, and the LA Times reports on the latest results from the project:

In the new study, the team scanned the brains of 74 of the Bucharest children, now ages 8 to 11, using magnetic resonance imaging. What they found was striking: Brains of children who had remained in institutions had less white matter — the type of tissue that connects different regions of the brain — than orphans who were placed in foster care or children living with their own families.

Reductions in white matter have been found in numerous neurological and psychiatric conditions, including autism, schizophrenia and attention deficit hyperactivity disorder, or ADHD. Study senior author Charles Nelson, a developmental neuroscientist at Children's Hospital Boston, said the white-matter changes were probably related to a difference that the scientists had noticed earlier in the project: Children in institutions had less electrical activity in their brains — specifically, a kind known as "alpha power" — than those who had gone to foster homes.

"If a normal kid is like a 100-watt light bulb, these kids were a 40-watt light bulb," Nelson said.

You want to know the value of the social sciences? Here you go. There are two big things we could do if we really wanted to improve our childrens' future: aggressively get rid of all the remaining lead in our soil and in old houses — all of it — and spend a bunch of money on high-quality early childhood interventions among poor and working-class families. If we don't think we have the money — an argument I'll put off to another day — we should take it out of the K-12 budgets. We'd be better off with 100% more pre-K and 20% less K-12 than we are with our current funding priorities.

The investment return on these two things is probably astronomical. Unfortunately, like all good things, they cost money and require rigorous execution, something that's nearly impossible because one of our major parties will never consider shifting money out of K-12 and the other is run by nihilists who are unwilling to spend money on anything other than national defense. So instead we twiddle our thumbs, doing nothing until the evidence in favor of these child-centered programs is literally bulletproof, something that might take a while since social science evidence is, by its nature, almost never bulletproof.

In the meantime, though, there's plenty of bipartisan support for ethanol subsidies. Welcome to America.

For more on this topic from me, click here. And here. For a terrific cover story on the topic from Jon Cohn in the New Republic, click here.

Social Science is Hard

| Tue Jul. 24, 2012 10:19 AM EDT

Via Dan Drezner, Nature defends federal funding of the social sciences and gets this part exactly right:

Because they deal with systems that are highly complex, adaptive and not rigorously rule-bound, the social sciences are among the most difficult of disciplines, both methodologically and intellectually....So, what has political science ever done for us? We don't, after all, know why crime rates rise and fall. We cannot solve the financial crisis or stop civil wars, and we cannot agree on the state's role in systems of justice or taxation. As Washington Post columnist Charles Lane wrote in a recent article that called for the NSF not to fund any social science: “The 'larger' the social or political issue, the more difficult it is to illuminate definitively through the methods of 'hard science'.”.

In part, this just restates the fact that political science is difficult. To conclude that hard problems are better solved by not studying them is ludicrous. Should we slash the physics budget if the problems of dark-matter and dark-energy are not solved? Lane's statement falls for the very myth it wants to attack: that political science is ruled, like physics, by precise, unique, universal rules.

The public commonly thinks of disciplines like physics and chemistry as hard because they rely so heavily on difficult mathematics. In fact, that's exactly what makes them easy. It's what Eugene Wigner famously called the "unreasonable effectiveness" of math in the natural sciences: the fact that, for reasons we don't understand, the natural world really does seem to operate according to strict mathematical laws. Those laws may be hard to figure out, but they aren't impossible. And once you do figure them out, the rest is mere engineering.1

Hari Seldon notwithstanding, the social sciences have no such luck. Human communities don't obey simple mathematical laws, though they sometimes come tantalizingly close in certain narrow ways — close enough, anyway, to provide the intermittent reinforcement necessary to keep social scientists thinking that the real answer is just around the next corner. And once in a while it is. But most of the time it's not. It's decades of hard work away. Because, unlike, physics, the social sciences are hard.

1Just a wee joke. Settle down.

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Ethanol Subsidies: Even Stupider Than We Thought

| Tue Jul. 24, 2012 12:10 AM EDT

Why do we import 4 million gallons of ethanol from Brazil every year and then export 2 million gallons of it right back? Because U.S. ethanol regulations require us to use a certain amount of "advanced" ethanol — i.e., ethanol that produces less carbon than gasoline, which corn ethanol mostly doesn't — but it turns out we're not doing too well on the advanced ethanol front. Our corn ethanol subsidies are so lucrative that this is where all our R&D dollars go. But American ingenuity knows no bounds, so we're meeting the regulation by exporting our crappy corn ethanol to Brazil and receiving their sugar cane ethanol in return. It's all the same, but cane ethanol counts as advanced, so shipping our stuff to them and their stuff to us allows us to meet the minimum requirements for use of advanced ethanol. It all makes sense in a demented sort of way.

This inspiring tale comes from Timothy Wise, who has more details here. Once again, we learn that ethanol subsidies are possibly the stupidest government program ever invented. And that's saying a lot.

Chart of the Day: Voter ID and Racial Resentment

| Mon Jul. 23, 2012 5:16 PM EDT

Who supports voter ID laws? Obviously, Republicans support them more than Democrats. Since voter ID laws are mostly aimed at suppressing the Democratic-leaning vote, that makes sense.

But there are differences even among voters who identify as either Republican or Democratic. According to a new survey from the Center for Political Communication at the University of Delaware, 53% of Democrats with low levels of racial resentment oppose voter ID laws. Among Democrats with high levels of racial resentment, that plummets to 23%.

Ditto for Republicans. Among those with low racial resentment scores, 13% oppose voter ID laws. Among Republicans with high racial resentment scores, that's cut in half, to 7%.

Racial resentment is measured by responses to only three questions, which makes it a little less robust than we might like. On the other hand, the questions are admirably straightforward. The first one, for example, is this: "I resent any special considerations that African Americans receive because it’s unfair to other Americans." That's pretty clear.

I'm not sure there's anything much we can do with these results. They aren't going to change anyone's mind. But it certainly confirms that race is bound up pretty strongly with the whole voter ID movement.

(Via Steven Taylor.)

Our Financial System is Still Broken

| Mon Jul. 23, 2012 1:25 PM EDT

Riffing off a post by John Kay, Felix Salmon points out that a big part of the problem with our financial system is the way that derivatives have corrupted aspects of banking that used to have an actual, concrete purpose:

Barclays’ Libor lies, for instance, started life as a way for its derivatives traders to make money: something which could never have happened when the banks reporting into the Libor system didn’t have derivatives desks.

A large part of the problem is the way in which financial tools which had a utilitarian purpose when initially designed have become primarily vehicles for financial speculation. Libor, for instance, was a way for banks to peg loan rates to their own funding costs, and thereby minimize their own risks while at the same time minimizing the amount that borrowers had to pay. Today, banks don’t fund on the interbank market any more, and Libor has become something else entirely: a number to be speculated on in the derivatives market, and, in times of crisis, an indication of how creditworthy banks are perceived to be.

Libor is no longer actually used to peg loan rates. Equity trading no longer bears much relationship to the actual value of companies. Asset-backed securities have little to do with making actual loans to actual people. As derviatives become more and more abstracted from their underlying instruments, they've morphed into independent entities to bet on, not ways to make the financial system run more smoothly:

Kay’s conclusion is sobering spot-on: the entire financial-services industry, he says, needs to be restructured so as to create the kind of institutions which thrive on increased trust, rather than on maximized arbitrage of anything from news to interest rates to regulations. In order for that to happen, we’re going to need to see today’s financial behemoths broken up into many small pieces — because at that point each small piece is going to have to earn the trust of the other small pieces which rely on it.

Felix is no more optimistic about that happening than I am. The financial crisis produced Dodd-Frank and Basel III, and that's pretty much it. Both are better than nothing, but neither comes close to addressing the fundamental problems with Finance 3.0. And I suppose we never will. The world had plenty of problems with a money economy, and plenty of problems with a credit economy, none of which were ever really fixed. So there's not much reason to think that we'll ever fix the problems with our shiny new derivatives economy either. I sort of wish we'd at least given it a serious try, though.

The Case Against Terror

| Mon Jul. 23, 2012 12:22 PM EDT

Germany's vice chancellor says that a possible Greek exit from the euro has "lost its terror." Paul Krugman isn't happy about that:

I find their lack of terror ... disturbing.

I’m not saying that Greece should be kept in the euro; ultimately, it’s hard to see how that can work. But if anyone in Europe is imagining that a Greek exit can be easily contained, they’re dreaming. Once a country, any country, has demonstrated that the euro isn’t necessarily forever, investors — and ordinary bank depositors — in other countries are bound to take note. I’d be shocked if Greek exit isn’t followed by large bank withdrawals all around the European periphery.

....My advice here is to be afraid, be very afraid.

Fine. I'm afraid. But here's my question. Like Krugman, I find it hard to imagine a scenario in which Greece stays in the euro. But is there any way for Greek exit to happen in some non-scary way? The problem of contagion remains real no matter how Greece leaves, and the problem of panic probably isn't solvable either. After all, Greece will leave the euro if and when other countries refuse to pony up more aid, and if that happens then Greece is doomed. What's more, this isn't the kind of thing you can plan for. Any planning for a Greek exit would inevitably become public very quickly, and that would do nothing except generate panic even sooner than the actual exit itself.

So if Greek exit really is inevitable, what's the argument against the German position? Why not go ahead and talk about it soothingly, do whatever contingency planning you can behind the scenes, and then hope for the best?