Kevin Drum - October 2013

Can Methanol Save Us All?

| Fri Oct. 11, 2013 9:37 AM PDT

In the Wall Street Journal today, George Olah and Chris Cox suggest that instead of venting carbon dioxide into the atmosphere, where it causes global warming, we should use it to create methanol:

Thanks to recent developments in chemistry, a new way to convert carbon dioxide into methanol—a simple alcohol now used primarily by industry but increasingly attracting attention as transportation fuel—can now make it profitable for America and the world to reduce carbon-dioxide emissions.

At laboratories such as the University of Southern California's Loker Hydrocarbon Research Institute (founded by George Olah, one of the authors here), researchers have discovered how to produce methanol at significantly lower cost than gasoline directly from carbon dioxide. So instead of capturing and "sequestering" carbon dioxide—the Obama administration's current plan is to bury it—this environmental pariah can be recycled into fuel for autos, trucks and ships.

....In Iceland, the George Olah Renewable Methanol Plant, opened last year by Carbon Recycling International, is converting carbon dioxide from geothermal sources into methanol, using cheap geothermal electrical energy. The plant has demonstrated that recycling carbon dioxide is not only possible but commercially feasible.

Olah has been writing about a "methanol economy" for a long time, and he skips over a few issues in this op-ed. One in particular is cost: it takes electricity to catalyze CO2 and hydrogen into methanol, and it's not clear how cheap it is to manufacture methanol in places that don't have abundant, cheap geothermal energy—in other words, most places that aren't Iceland. There are also some practical issues related to energy density and corrosiveness in existing engines and pipelines. Still, it's long been an intriguing idea, since in theory it would allow you to use renewable energy like wind or solar to power a facility that creates a liquid fuel that can be used for transportation. You still produce CO2 when you eventually burn that methanol in your car, of course, but the lifecycle production of CO2 would probably be less than it is with conventional fuels.

I haven't kept up with the details of this lately, so I don't know what Olah means when he talks about "recent developments" in chemistry. Does he mean stuff that's been in the pipeline over the past decade, or something that's genuinely new over the past year or two? I'm not sure. I'd be interested in reading a response from a neutral expert, though.

And why did this appear on the Wall Street Journal op-ed page, not a place that's famous for its concern over climate change? Because Olah and Cox are arguing that for methanol to compete in the marketplace, we need to stop subsidizing ethanol unfairly. I'm all for that, and I guess the Journal is too. I'm also on the lookout for anything non-shutdown related to write about. Any port in a storm.

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Pundits Soon to Face the Wrath of PolitiFact

| Fri Oct. 11, 2013 9:03 AM PDT

A regular reader warns me to watch my back:

PolitiFact, the Pulitzer Prize-winning fact-checking website of the Tampa Bay Times, will soon launch PunditFact, a site dedicated to checking claims by pundits, columnists, bloggers and the hosts and guests of talk shows.

Luckily, I'm not important enough to catch the attention of these guys, so I can probably continue to lie with impunity. For example, did you know that a recent study concluded that PolitiFact made a substantial contribution to increased political polarization? It was very clever. The researchers used Mechanical Turk to recruit a dozen college students who read an article about Obamacare. Half the students then read a PolitiFact column that fact-checked an Obama speech and the other half read a column that —

Just kidding! There was no such study. Seriously, how could PolitiFact contribute to polarization when we all know that conservatives don't care about facts in the first place? As the chart on the right shows —

Kidding again! There's no chart. But I wish there were. It would be interesting to know whether fact-checking operations actually have any impact whatsoever on public opinion. Based on my own zero percent track record of ever changing anyone's mind, I'd guess not. But a study would be great. Especially if it had a colorful chart to go along with it.

Anyway. Here's what I'm really curious about: How will PunditFact go about deciding which pundits to check? Given that they're including radio and TV talkers and guests in their net, I'd guess that they'll have something like a thousand outright lies to check every day. I'm talking about things that aren't even close calls and that are heard or read by audiences numbering in the millions. So which ones actually get their attention? That's easily the most important decision they'll make, since the actual process of demonstrating the lies is sort of like shooting fish in a barrel. You might as well just hire a few dozen interns for that part of the job.

But I'll bet they won't tell us. Nobody ever does.

Republicans Intent on Keeping Hostage Power Forever

| Fri Oct. 11, 2013 8:00 AM PDT

I assume that David Drucker of the Washington Examiner has a good sense of what Republicans are really thinking about the debt ceiling, and it's not a cheery analysis:

At issue isn't whether House Republicans should accept a bad deal to raise the federal borrowing limit and ensure the U.S. does not default on its $16.7 trillion debt. Republicans are concerned that the refusal of President Obama and Senate Democrats to negotiate those issues with Republicans would establish a precedent making it impossible to haggle over future debt limit increases or to use them as leverage in other policy negotiations....Republicans see the debt ceiling vote as part of an institutional fight over constitutional authority, which is harder for them to walk away from than a policy priority that can always be brought up again later.

In other words, just as I suspected last night, the offer of a 6-week debt ceiling extension doesn't mean much. It's just another deadline. Not only will it be used as a hostage yet again, but Republicans are intent on using the debt ceiling as a hostage forever into the future.

This is what makes the whole affair so intractable. President Obama is intent on preventing the debt ceiling from ever being used as a hostage again. Republicans are intent on keeping it alive as a hostage to be used annually forever. Once you cut through all the sound and fury, that's where we are. There's simply no compromise possible.

Or is there? I keep wondering if it's possible to come up with something outside the framework of the debt ceiling. That is, get rid of the debt ceiling, but put something else in place that gives the House more budget leverage than it has now. I'm not sure what that is since, despite what the tea partiers apparently think, the House already has considerable leverage just through the normal order of things. But maybe there's something that could give them a little bit more without doing serious damage to the constitutional order.

Probably not. It's just a thought.

Surprise! Support for Obamacare Is Up Sharply Over the Past Month

| Thu Oct. 10, 2013 4:22 PM PDT

The latest NBC/Wall Street Journal poll is just an endless horror show for Republicans. Obama's approval is up; Republican Party approval is down; confidence in the economic recovery has plummeted thanks to the budget standoff; and voters blame Republicans for the government shutdown by a margin of 53-31. Virtually everyone who's not a hardcore dittohead blames the GOP. What's more, 73 percent of the public thinks the shutdown is a serious problem and 31 percent have been personally affected.

But none of that is a big surprise. Here's something that is: After a week of 24/7 media coverage about the problems with the rollout of Obamacare, its popularity has gone up. It's still not doing gangbusters or anything, but it's pretty interesting that an awful lot of people who previously had no opinion are now feeling pretty positive about it. Is this because they or someone they know has actually gone on line and discovered that there are pretty good deals available? I don't know. But something has changed their minds.

How Many Republicans Will Vote to Confirm Janet Yellen?

| Thu Oct. 10, 2013 2:56 PM PDT

It's time for a pool. There are currently 46 Republicans in the Senate. How many of them do you think will vote to confirm Janet Yellen as chairman of the Fed? Keep in mind that there isn't even a ghost of a reason to vote against her.

I'll go with 13. Not for any particular reason. Just because. Leave your guess in comments.

Boehner Offers to Delay Hostage Taking Until Thanksgiving

| Thu Oct. 10, 2013 11:40 AM PDT

Like everyone, I guess, I'm having trouble keeping track of what's really going on today. My best reading of the tea leaves is that John Boehner plans to offer President Obama a clean 6-week debt ceiling extension in exchange for a willingness to negotiate over the budget. Or something. Maybe there will actually be some strings attached. It's hard to tell.

But it's hard to fathom the point of a 6-week extension even if it comes without formal strings attached. The fact that Republicans are insisting that Obama negotiate with a debt ceiling breach looming over him is a tacit admission that the debt ceiling is still being used as a threat. Right? Or am I missing something here?

I suppose Obama would have to sign a clean extension regardless. And he probably should. And who knows? Anything can happen in six weeks. But it's a little hard to see that this accomplishes anything except to guarantee a Thanksgiving hostage crisis instead of a Halloween hostage crisis.

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Domestic Credibility is More Fragile Than International Credibility

| Thu Oct. 10, 2013 10:37 AM PDT

Dan Drezner is skeptical about the role of "credibility" in international relations—for example, the proposition that what happens in Syria now has a big impact on what happens in Iran a year from now. Despite this, he believes credibility does matter in domestic politics:

The importance of credibility gets magnified even further when appreciating that [the] same individuals are going to have to go to the bargaining table again and again and again over the next few years. It is in precisely this set of circumstances — in which the bargaining is ongoing and the individual actors don't change — that one would expect credibility and a reputation for tough bargaining to be pretty friggin' important (though I'd really, really like to hear from my American politics colleagues on this question).

I agree, though I'd put it slightly differently. In foreign affairs, it's very seldom that you see identical scenarios unfold over and over. Everyone accepts that the United States has certain interests, and it's not hard to recognize that our interests in Syria are somewhat different than they are in Iran. Thus, the fact that we changed course on bombing Syria over a very specific violation of international norms regarding chemical weapons says very little about how we'd eventually react to Iran building a nuclear bomb. Sure, they both involve WMDs in some way, but the similarity ends there. Syrian chemical weapons simply aren't a big priority for America. Iranian nuclear bombs are. Everyone knows this.

The case of the debt ceiling is precisely the opposite. It's the exact same scenario every time. If President Obama granted concessions in 2011—which he did—and then grants concessions in 2013 under the exact same conditions, his credibility is unquestionably shredded. There's simply no doubt that he'll grant concessions every single time we get close to reaching the debt ceiling. In this case, it really is all or nothing. Obama either has credibility on the debt ceiling or he doesn't. If he concedes anything at all, his credibility is gone.

Similar situations are very uncommon in international relations. Situations separated in time are almost always different enough that it's hard to draw any firm conclusions about patterns of behavior, which is why it takes a very long time for credibility to be either established or lost. In domestic affairs, there's no such fuzziness.

Here's Why I Think Jack Lew Needs to be Painfully Honest About the Debt Ceiling

| Thu Oct. 10, 2013 9:33 AM PDT

I've gotten a bunch of email and comments regarding my post earlier this morning that criticized Jack Lew's vagueness about how Treasury would deal with a debt ceiling breach. Instead of adding an update to the post, I want to create a whole new one to address them. I think it's important. Here's a sampling from the comment thread:

TLM: Of course they have a plan. But telegraphing that plan is a no-win exercise on multiple levels.

histprof1: Why would any functional person give the GOP anything to work with at this point?....I suspect that he has a plan and has his rationale ready. I also suspect that he will let the politics work until past the last minute before he goes legal. In fact, I suspect that his first executive action after the GOP fails to raise the limit will be aimed at making them try again. After that, he goes into emergency powers territory and the checks and balances fun begins.

Jasper_in_Boston: What's so hard to understand, Kevin? Default would quite possibly be catastrophic, and Lew (and Obama) quite understandably don't want to give the forces of nihilism any reason to think we can get through it easily.

gyrfalcon: Bingo, bingo, bingo. The GOPers have already glommed onto the idea that we can pay off bonds from incoming revenues, and many of them are positively gleeful at the idea of having the government stiff everybody else, including SS and veterans' benefits, thinking it will look to the public like Obama's doing....It flat-out isn't possible to discuss this honestly with this pack of denialists and nihilists. The admin's only possible strategy is to keep it as vague as possible.

This is the conventional wisdom, and believe me: I get it. But I think it's dead wrong. The assumption here is that (a) the alarm level needs to be kept at maximum, and (b) no one will ever find out if Lew was being truthful because the debt ceiling will eventually get raised.

Maybe. But that's a pretty dangerous assumption at this point. And if we do breach the debt ceiling, and it turns out that prioritization was in the pipeline all along, and Social Security checks were never in danger, and Treasury can in fact choose which bills to pay—in other words, if the alarms turn out to have been overblown—then there's going to be hell to pay. Republicans will be more convinced than ever that they can't trust anything Lew or Obama says, and they'll become even more instransigent about the debt ceiling. In other words, genuine disaster becomes even more likely.

Like it or not, my view is that Lew needs to be rigorously, meticulously honest. He absolutely can't afford to say anything that might turn out not to be true, or that might eventually be seen as politicization or game playing. That includes making vague statements that later turn out to be deceptive because, in fact, plans were in place and he knew it.

Is it possible that being truthful will persuade some of the nutballs that the debt ceiling isn't actually a big deal? Sure. But they already think that. So who cares? The real audience for Lew's testimony is the folks who are conservative but not crazy. They're on the edge already, but if they start to get an inkling that Lew is scaremongering in even the smallest way, they could turn against him.

I understand the arguments about how dangerous it is to run the risk of making a debt ceiling breach seem manageable. But I think it's a lot more dangerous to be caught making even modestly deceptive statements "for the greater good." My earlier post wasn't written just because I'm personally curious about what Treasury's plans are. It was written because I think Lew is playing with fire.

UPDATE: Just as I finish writing that a debt ceiling increase is a "dangerous assumption," we start getting reports from Capitol Hill that Republicans are getting ready to pass a short-term debt ceiling increase. Only for a few weeks, though. Stay tuned.

Republicans Still in Total Disarray Over Debt Ceiling Increase

| Thu Oct. 10, 2013 8:52 AM PDT

Jonathan Strong says I should read Tim Alberta's latest piece in National Journal, so I did. And I'm mystified:

In interviews with numerous GOP lawmakers, members spoke with confidence — and acceptance — of the fact that the House will soon approve a short-term deal to raise the debt-ceiling and force Democrats to the negotiating table. Details are still being ironed out, House Republicans said, but they are on track to approve a debt-limit extension — lasting between four and six weeks — that would establish a framework for subsequent fiscal negotiations.

....The particulars of this short-term proposal are in flux, as there are ongoing discussions within the conference regarding which provisions — if any — should be attached. Some members are pushing for commensurate spending cuts, though such a figure could be difficult to calculate. Others are advocating the inclusion of one, or multiple, mini-funding bills that have been passed through the House. A clutch of conservatives, meanwhile, are asking for language that would prioritize Treasury payments.

Am I missing something? The one thing President Obama has said he won't do is negotiate over a debt ceiling increase. So what do these guys do? Propose a 4-week debt ceiling increase with a bunch of conditions attached.

If I'm reading Alberta's piece correctly, Republicans seem to think that a debt ceiling increase with conditions attached would be OK with Obama because it's not actually a negotiation. They're just telling him what he has to do. So, you know, he could sign it and then start negotiating. Or something.

Either (a) Alberta is reporting this wrong, (b) I'm reading it wrong, or (c) Republicans are even more divorced from reality than I thought. Take your pick.

Jack Lew Is Still Surprisingly Vague About How He'll Deal With a Debt Ceiling Breach

| Thu Oct. 10, 2013 8:06 AM PDT

From Jack Lew's congressional testimony this morning:

In testimony before the committee, Mr. Lew stressed that the Treasury Department would run out of “extraordinary measures” to free up cash in a matter of days. At that point, the country’s bills might overwhelm its cash on hand plus any receipts from taxes or other sources, leading to an unprecedented default. Mr. Lew said that Treasury had no workarounds to avoid breaching the debt ceiling. “There is no plan other than raising the debt limit,” he said. “The legal issues, even regarding interest and principal on the debt, are complicated.”

He also said prioritizing payments to bondholders or others might not be workable, adding that the Treasury would face significant technical issues in trying to rejigger its complicated automated payment systems to pay certain bills but not others. “Our systems were not designed to not pay our bills,” he said.

Some market participants have suggested that Treasury might simply pull the plug on one or more of its payments systems to prevent money from going out, perhaps telling the recipients of that money that it would pay them when possible. But “I don’t believe there is a way to pick and choose,” except on a broad basis, Mr. Lew said.

I just don't get this. Maybe this is the best Lew can do, but given all the time he's had to study this, and the fact that we're only a week or two away from D-Day, how is it that he doesn't know (a) how close we are to running out of money, (b) whether prioritization is possible, and (c) if Treasury's computer systems allow it to choose which bills to pay.

I'm not a nutball Republican denier, but even I don't believe this. It's October 10. This is our second go-around with a debt ceiling crisis. We've been planning for this one for more than six months. Is it really plausible that Lew still doesn't know if prioritization is possible? Is it really plausible that there's still no plan in place? Is there some reason he isn't telling Congress what that is?

Something doesn't add up here.