Kevin Drum - 2012

More Specialists Are in Your Medical Future

| Tue Jan. 24, 2012 3:13 PM EST

According to a new study, doctor visits that result in a referral to a specialist have grown by 159% over the past decade. Suzy Khimm summarizes the reasons for us:

The big question is why doctors have become more likely to send their patients to specialists. Part of the answer, Landon finds, has to do with health care becoming more complex, with new technology that demands more speciality care. Physicians have also found themselves with more preventive tests and screenings to handle, which may cut into time to deal with other issues. And, part of it likely has to do with the economics of referrals: Doctors who have an ownership stake in their practice are 50 percent more likely to refer to a specialist, which would increase the total revenue generated by a given patient.

There's not much we can do about the fact that medicine is becoming increasingly complex. That's likely to just get worse. But the financial incentives for referrals sure seem ripe for reform. Obamacare makes a stab in this direction with its pilot program for accountable care organizations, but there's no telling yet if it will have a significant impact. Stay tuned.

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Newt Gingrich Not as Good a Debater as Newt Gingrich Thinks He Is

| Tue Jan. 24, 2012 1:44 PM EST

Jonathan Bernstein analyzes Newt's performance in last night's debate and says one thing I agree with and one thing I don't. First, here's the part I think is wrong:

If people were looking for ammunition against Newt Gingrich, he supplied plenty of it Monday during an early and extended exchange with Romney, in which Newt floundered badly on the subject of Freddie Mac, his ethics scandal when he was speaker, and other weaknesses.

I had exactly the opposite reaction. If you already know the facts about the ethics scandal, then you'll think Newt floundered. If you don't — and I think this describes about 95% of the audience — Newt's explanation either (a) sounded OK or (b) muddied the waters enough that you came away thinking it was just routine campaign sniping. Besides, it was 15 years ago. Romney really needs to have a clearer, sharper attack on the ethics charges if he expects this to stick.

And here's the part I think is right:

What Monday demonstrated [] is that Newt’s reputation as a brilliant debater is actually a fraud. What Newt has done well isn’t debating the other candidates; what he’s done well is attacking the moderators, and it works especially well when there’s a partisan Republican audience ready to cheer any shots at the liberal media. That’s not going to happen in general election debates. More broadly, he’s quite good at using language designed to appeal especially well to Rush Limbaugh listeners: Chicago-style politics, Saul Alinsky, teleprompters, and more. Terrific, again, for provoking a big reaction from a partisan audience of intense, highly-informed conservatives. Utterly useless in general election debates.

Yep. Newt's sneering, condescending tone is pitch perfect for the tea party crowd, but extremely off-putting for the less partisan folks who will determine November's results. And without that, Newt's got nothing. He doesn't really do any better on substance than Romney or any of the others, and he certainly doesn't have any native charm. If he tries to take his sneer on the road in a general election, he'll be no more successful than Rick Perry was at trying to transplant his Texas-style campaigning to a national audience.

Bruce Bartlett's Freakishly Good Tax Reform Timing

| Tue Jan. 24, 2012 12:39 PM EST

Last night I read Bruce Bartlett's new book, The Benefit and The Burden: Tax Reform-Why We Need It and What It Will Take. It's written as a primer on American taxes, and it's a great introduction for anyone who doesn't really know much about the U.S. tax system and wants to learn the basics. It's clear, short, and a quick read.

Still, I confess that I was sort of charmed by Bruce's apparent optimism that genuine tax reform will be on the table after the election is over. "Genuine," of course, means broadening the tax base and getting rid of loopholes and deductions, and being revenue neutral at a minimum. In other words, it's not a tax cut. What are the odds of that?

Pretty slim. And yet, what do I see when I open my copy of the LA Times this morning?

President Obama will use his State of the Union address this evening to make a renewed case for an overhaul of the tax reform, one of a host of "common sense" ideas advisers say he'll offer to shore up the American economy and tackle the growing deficit.

...."We want to reward wealth and prosperity and success. But if we're going to move forward as a country, reduce our deficit, invest in things like manufacturing and education, how are we going to pay for it?" [David Plouffe] said on NBC's "Today" show. "There's no question that we have a tax code that's far too complicated, far too complex. And when the middle class, the average middle-class worker is paying more in taxes than people who are making $50 (million), $60 million a year, we've got to change that."

I still don't believe this is going to happen. Republicans are simply too deeply invested in the theology of both tax cuts and corporatism to cooperate on anything resembling genuine tax reform. It's not 1986 anymore.

Still, you never know. And it certainly demonstrates that Bruce has freakishly great timing. Tonight people will tune in to the State of the Union address and hear Obama calling for comprehensive tax reform, and tomorrow they'll all stampede to their local Barnes & Noble to find a nice, short book that explains what tax reform is all about. Bruce will become an overnight millionaire, right?

Iran Sanctions Bite Ever Harder

| Tue Jan. 24, 2012 12:18 PM EST

While Mitt Romney and Newt Gingrich were busy giving rabble-rousing speeches about how the appeaser-in-chief has been touring the globe apologizing for America and hollowing out our military influence, guess what happened?

Europe slapped a boycott on Iranian oil Monday, signaling that the Islamic Republic's second-largest market is likely to dry up as part of a U.S.-led sanctions campaign that has already inflicted serious damage on Iran's economy and sharply increased tensions.

....In the past, Europe often has resisted U.S. efforts to build pressure on Iran. "If you had told me a year or two ago that the Europeans would do something like this, I would have said you were crazy," said Mark Dubowitz, executive director of the Foundation for Defense of Democracies, a research group in Washington that favors strong sanctions.

....The effect will be amplified by a new round of U.S. sanctions, which, if fully implemented, will prevent companies that do business with Iran's central bank from dealing with American companies....China says publicly that it will not yield to pressure to give up Iranian oil, but it has reportedly cut back on purchases for January and February and is pushing for discounts.

How about that? Europe is now fully on our side, Russia and China are officially neutral but not actively undermining us, and Iran is starting to feel serious pressure. Somebody's foreign policy seems to be having an actual effect.

It can't be President Obama, though. Too weak. Here's what's really happening: the EU is desperately getting on the sanctions bandwagon because they're afraid that President Gingrich will bring down the hammer after he wins a landslide 535 electoral votes in November (the big-government leeches in DC stubbornly hold out against the tide, of course). The fear of Newt is forcing them to get serious for the first time ever.

Think I'm joking? Ten bucks says some actual conservative columnist makes this argument. For all I know, someone already has.

Greek Debt Talks Going Down to the Wire

| Tue Jan. 24, 2012 11:57 AM EST

Reuters reports on the "voluntary" restructuring of Greece's debt:

Euro zone finance ministers on Monday rejected as insufficient an offer made by private bondholders to help restructure Greece's debts, sending negotiators back to the drawing board and raising the threat of Greek default.

....Banks and other private institutions represented by the Institute of International Finance (IIF) say a 4.0 percent coupon is the least they can accept if they are going to write down the nominal value of the debt they hold by 50 percent.

Greece says it is not prepared to pay a coupon of more than 3.5 percent, and euro zone finance ministers effectively backed the Greek government's position at Monday's meeting, a position that the International Monetary Fund also supports.

I love the smell of voluntary in the morning. Felix Salmon has more.

Mitt Romney is Doing Pretty Well For Himself

| Tue Jan. 24, 2012 1:35 AM EST

Mitt Romney has released his two most recent tax returns:

Mitt Romney offered a partial snapshot of his vast personal fortune late Monday, disclosing income of $21.7 million in 2010 and $20.9 million last year — virtually all of it profits, dividends or interest from investments.

That's pretty impressive. Not the fact that Romney paid a 13.9% tax rate on this haul — we already pretty much knew that. No, I'm talking about the fact that he made $21 million each year. Most public reports put Romney's wealth in the neighborhood of $250 million, which means he got a return of about 8.4% both years. That's a real return of around 7% during a generally slow-growth period when most people are scrounging around just to find safe investments that pay a point or two more than treasuries. When it comes to managing big pots of money, it looks like Romney hasn't lost his old magic.

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The Real Reason Larry Summers Didn't Advocate a $1 Trillion Stimulus

| Mon Jan. 23, 2012 9:31 PM EST

At this point, it's not clear to me how useful it is to keep re-litigating the role Larry Summers played in deciding how big the 2009 stimulus package should be. Lots of different participants have given their views, and there's simply a limit to how much we're ever going to know.

Still, a contemporaneous memo is different. If we had a copy of the written advice Summers gave to President-elect Obama in December 2008, that would tell us a lot, wouldn't it? Well, now we do, thanks to Ryan Lizza. And guess what? I'm still not sure it will help produce any consensus on Summers' role. Paul Krugman, for example, comes away from it with this:

The key thing I took away from the memo is that it does not read at all like the current story the administration gives for the inadequate size of the stimulus, which is that they knew it should be larger but had to face political reality. Instead, the memo argues that a bigger stimulus would be counterproductive in economic terms, because of the "market reaction." That is, Summers et al were afraid of the invisible bond vigilantes. And to the extent that there is a political judgment, it's all in the opposite direction: if the stimulus is too big, we'll have trouble scaling it back, but if it's too small, we can always go back to Congress for more. That was deeply naive—and I said so in real time.

But that's not at all what I came away with after reading the memo. It's true that political reality (i.e. Congress) gets only a few brief mentions, but at the same time Summers is pretty clearly not worried about bond vigilantes and doesn't believe that going back to Congress for more money would be easy. Quite the opposite. After spelling out the case for a big stimulus, Summers lists some "considerations on the other side," as any honest advisor would. However, he specifically argues that those other considerations are wrong. The bond market isn't likely to react badly, he says, and "we do not believe this should deter escalation well above $600 billion." And while some may believe that we can always do more later if we need to, Summers argues instead that "this is a key moment to get ahead of the curve in responding to economic distress."

Now, it's clear from the memo that Summers and others underestimated the depth of the coming recession, though perhaps not by as much as everyone thinks. In fact, he's clear that an $850 billion stimulus would close only half the output gap, and then makes his primary argument for not trying to close the whole thing:

But it is important to recognize that we can only generate about $225 billion of actual spending on priority investments over next two years…This total, however, falls well short of what economists believe is needed for the economy, both in total and especially in 2009. As a result, to achieve our macroeconomic objectives—minimally the 2.5 million job goal—will require other sources of stimulus including state fiscal relief, tax cuts for individuals or tax cuts for businesses. All three of these areas, however, raise tradeoffs because they are not as economically effective as stimulus, do not represent a down payment on a campaign promise (with the exception of the Making Work Pay credit), and do not have a lasting impact on the economy beyond protecting against a deep recession.

Emphasis in the original. Summers believed that it was only possible to come up with $225 billion in direct spending that had a high stimulus value. Further money could be targeted at tax cuts and aid to states, but it had a lower stimulus value. So there was a sense of diminishing returns here.

Now, that might have been wrong, but it's a fairly defensible position. And it has nothing to do with bond vigilantes or bad political judgments. So even with a contemporaneous memo available to read, the Rashomon effect is still strong. All of us read the same words and we all come away with different interpretations.

Fear and Contempt on the Campaign Trail

| Mon Jan. 23, 2012 7:21 PM EST

This is hardly the most important thing in the world, but I've heard an awful lot of people lately saying that Newt Gingrich's recent success is due to the fact that no one is better than him at channeling the anger of the Republican base. There's nothing really wrong with that formulation, but for the record, I don't think anger is quite the emotion in play here. Rather, it's fear and contempt. The tea party wing of the Republican Party fears that the America they love is being taken away from them, and they have almost unbounded contempt for President Obama, the taker-away-in-chief.

And who does fear and contempt better than Newt? No one. Those are the emotions he's channeling, not just boring old anger.

Charts of the Day: U.S. Energy Consumption Not Likely to Change Much

| Mon Jan. 23, 2012 2:00 PM EST

Brad Plumer points us to the U.S. Energy Information Administration's newly released Annual Energy Outlook 2012 report, and their projections aren't especially heartening. They forecast that the U.S. mix of energy consumption isn't going to change much over the next 25 years, and as a result our carbon emissions aren't likely to decrease either. Brad has more here. The complete EIA report (with bigger charts!) is here.

The Catch-22 of Drone Assassinations

| Mon Jan. 23, 2012 1:41 PM EST

Glenn Greenwald points out something today that I'm embarrassed to say hadn't occurred to me:

On Saturday in Somalia, the U.S. fired missiles from a drone and killed the 27-year-old Lebanon-born, ex-British citizen Bilal el-Berjawi. His wife had given birth 24 hours earlier and the speculation is that the U.S. located him when his wife called to give him the news…El-Berjawi’s family vehemently denies that he is involved with Terrorism, but he was never able to appeal the decree against him for this reason:

Berjawi is understood to have sought to appeal against the order, but lawyers representing his family were unable to take instructions from him amid concerns that any telephone contact could precipitate a drone attack.

Obviously, those concerns were valid. So first the U.S. tries to assassinate people, then it causes legal rulings against them to be issued because the individuals, fearing for their life, are unable to defend themselves. Meanwhile, no explanation or evidence is provided for either the adverse government act or the assassination: it is simply secretly decreed and thus shall it be.

I'm already opposed to assassinations of U.S. citizens, and not especially excited about assassinations of non-U.S. nationals either (el-Berjawi was a dual Lebanese British national whose British citizenship was stripped in 2006). So this doesn't really change my mind about anything in a serious way. But it does make the whole thing a lot more Kafka-esque than I had imagined.

Still, in the case of non-U.S. nationals, I think the question of targeted assassinations is more difficult than some critics make it out to be. As always, it gets back to the fundamental question of (a) whether we're at war and (b) what the battlefield is. In a shooting war, obviously you're allowed to go after enemy combatants without a court order, and that's the essential rationale for these killings. But where does the line get drawn? Does this war ever end? Is its scope the entire world? Neither the Bush nor the Obama administrations have ever been willing to say, claiming simply that the AUMF, along with the president's inherent commander-in-chief powers, gave them all the authority they needed to make decisions solely within the executive branch.

And yet…it's not clear what other option there is. Genuine judicial hearings, even if you think that's the right way to go about this, are obviously nonstarters in practical terms. You could have something like the FISA court, authorizing targeted assassinations in secret hearings, which would be an improvement in technical terms but probably not in real life. It's not as if FISA turns down government requests very often, after all. Or we could simply stop killing suspected terrorists overseas unless they're in a declared war zone.

I'm a squish. I don't know the answer. One way or another though, I can't help but think that this is all going to turn out badly eventually.