Kevin Drum Feed | Mother Jones http://www.motherjones.com/Blogs/20...il-and-finance http://www.motherjones.com/files/motherjonesLogo_google_206X40.png Mother Jones logo http://www.motherjones.com en The Economy is Improving, But Not For Everyone http://www.motherjones.com/kevin-drum/2014/04/economy-improving-not-everyone <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>The BLS <a href="http://www.bls.gov/news.release/wkyeng.nr0.htm" target="_blank">reported today</a> that weekly earnings for full-time wage and salary workers rose 3 percent in the first quarter of 2014 compared to a year ago. Since inflation is running at 1.4 percent, <img align="right" alt="" class="image image-_original" src="/files/blog_earnings_production_2014_q1.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">that's good news. Earnings are going up.</p> <p>But wage gains are pretty unevenly distributed. Jeffrey Sparshott passes along a recent Labor Department note which concludes that <em>all</em> of the wage gains since 2009 have <a href="http://blogs.wsj.com/economics/2014/04/17/wealthiest-households-accounted-for-80-of-rise-in-incomes-in-recessions-aftermath/" target="_blank">gone to the top 40 percent.</a> The poor, the working class, and the middle class have seen no gains at all. This is reflected in the chart on the right, which shows weekly earnings for production and nonsupervisory workers. Weekly earnings for this group have been rising at a rate slightly above inflation for the past year, but not by much. Nor is that number getting better: In the first quarter of 2014, weekly earnings rose only 1.8 percent.</p> <p>There are some positive signs that the labor market is tightening a bit&mdash;decent job creation rates, fewer unemployment claims, rising earnings for full-time workers&mdash;but not everyone is benefiting. This remains a pretty uneven recovery.</p> </body></html> Kevin Drum Economy Fri, 18 Apr 2014 05:08:30 +0000 Kevin Drum 250101 at http://www.motherjones.com The Good News on Obamacare Just Keeps Rolling In http://www.motherjones.com/kevin-drum/2014/04/good-news-obamacare-just-keeps-rolling <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p><img align="right" alt="" class="image image-_original" src="/files/blog_obamacare_site_new.jpg" style="border: 1px solid black; margin: 8px 0px 15px 30px;">The open enrollment period for Obamacare is finally (almost) over, and today the White House announced the <a href="http://www.whitehouse.gov/blog/2014/04/17/president-obama-8-million-people-have-signed-private-health-coverage" target="_blank">final figures for signups via the exchanges:</a></p> <blockquote> <p><strong>8 million people signed up for private insurance in the Health Insurance Marketplace.</strong> For states that have Federally-Facilitated Marketplaces, 35 percent of those who signed up are under 35 years old, and 28 percent are between 18 and 34 years old, virtually the same youth percentage that signed up in Massachusetts in its first year of health reform.</p> </blockquote> <p>That's a little better than I expected. I was figuring the final number would be around 7.7 million or so. We Americans sure do like to procrastinate, don't we?</p> <p>Anyway, once some of these new enrollees drop out for not paying their premiums, the final number will be around 7 million, which matches the CBO's original estimate&mdash;the one they made <em>before</em> the website debacle. That's pretty amazing. It suggests that either the CBO was overly pessimistic or else that the website problems really didn't have any effect at all. I suppose the latter is plausible if you assume that hardly anyone was ever going to sign up in the first couple of months anyway.</p> <p>And the 28 percent number for young enrollees is pretty good too. It's below the administration's goal, but Jon Cohn points out that what really matters is whether it <a href="http://www.newrepublic.com/article/117410/obamacare-enrollment-hits-8-million-age-mix-looks-massachusetts" target="_blank">matches what insurance companies expected:</a></p> <blockquote> <p>The worry has always been that older and sicker people would sign up in unusually high numbers, forcing insurers to raise their prices next year and beyond.</p> <p>But insurance companies didn&rsquo;t expect young people to sign up in proportion to their numbers in the population. They knew participation would be a bit lower and they set premiums accordingly. Only company officials know exactly what they were projecting&mdash;that&rsquo;s proprietary information&mdash;but one good metric is the signup rate in Massachusetts, in 2007, when that state had open enrollment for its version of the same reforms. According to information provided by Jonathan Gruber, the MIT economist and reform architect, 28.3 percent of Massachusetts enrollees were ages 19 to 34, a comparable age group.</p> </blockquote> <p>So what <em>were</em> insurance companies expecting? As Cohn says, we don't know for sure, but there's good reason to think that it was around 28 percent. First, there's the Massachusetts precedent. And second, <a href="http://www.usatoday.com/story/news/nation/2014/04/16/lower-rise-in-health-care-costs/7515185/" target="_blank">we learned yesterday</a> that insurance companies are now expected to raise premiums a modest 7 percent next year. This suggests that that the age and health profile of exchange enrollees is pretty close to their projections.</p> <p>All in all, another day of pretty good news for Obamacare.</p> </body></html> Kevin Drum Health Care Thu, 17 Apr 2014 21:08:05 +0000 Kevin Drum 250081 at http://www.motherjones.com It Turns Out That the Beautiful People Really Do Look Down on the Rest of Us http://www.motherjones.com/kevin-drum/2014/04/it-turns-out-beautiful-people-really-do-look-down-rest-us <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>It turns out that beautiful people really do look down on the rest of us. Danielle Kurtzleben reports on a new study that assessed the attitudes of people after asking them to <a href="http://www.vox.com/2014/4/17/5623976/attractiveness-related-to-views-on-economic-inequality" target="_blank">rate their own attractiveness:</a></p> <blockquote> <p>Participants who perceive themselves as attractive also tend to not only believe they are of higher social status but also to believe in group dominance &mdash; that some groups are just inferior. They also were more likely to believe in ideas that legitimized their status, like the idea that all Americans have equal shots at making it to the top.</p> <p>....People who thought they were more attractive also tended to think that America's steadily growing inequality came about because of individual characteristics, like talent and hard work. People who thought they were uglier, meanwhile, thought outside factors &mdash; discrimination, political power &mdash; had more to do with inequality.</p> </blockquote> <p>People have a well-known cognitive bias in which they attribute positive outcomes to internal factors (hard work, smarts) and negative outcomes to external factors (bad luck, enemies who have it in for you). This is a similar kind of thing. People who are attractive tend to do better in life, but they resist the idea that this is partly due to the simple good luck of being tall or having regular features. And yet, there's abundant evidence that physical attractiveness makes a difference. <a href="http://www.motherjones.com/kevin-drum/2010/10/how-they-win" target="_blank">Just ask political candidates.</a></p> <p>Ditto for being white, male, healthy, middle class, etc. A lot of people might dislike the invocations of "privilege" that seem so endless these days, but it's a real thing. And it's everywhere.</p> </body></html> Kevin Drum Science Thu, 17 Apr 2014 18:29:25 +0000 Kevin Drum 250061 at http://www.motherjones.com Americans Wildly Overestimate the Impact of Routine Mammographies http://www.motherjones.com/kevin-drum/2014/04/americans-wildly-overestimate-impact-routine-mammographies <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Aaron Carroll passes along the following stunning chart about the actual efficacy of <a href="http://theincidentaleconomist.com/wordpress/this-is-why-we-cant-get-the-public-to-accept-changes-to-screening-mammograms/" target="_blank">routine breast cancer screening on 50-year-old women:</a></p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_mammography_effect.jpg" style="border: 1px solid black; margin: 15px 0px 10px 5px;"></p> <p>Obviously, there are circumstances where routine screening is a good idea&mdash;perhaps if you have a family history of breast cancer or other specific risk factors. But the best recent evidence suggests that routine screening for all women has a negligible effect. At best, it's very slightly positive. At worst it's literally zero because false positives lead to interventions that themselves carry a risk of death.</p> <p>The problem is that people don't believe this. They think that routine screening has a far greater impact than it really does. The <em>perception</em> of 50-year-old women is that routine screening saves the lives of about 80 women out of a thousand:</p> <blockquote> <p>Therein lies the problem. If you think that breast cancer is going to kill 16% of all 50-year-old women in the next 10 years and that mammography makes a huge difference in the mortality rate, then you&rsquo;re going to demand a universal screening program. Hell, I&rsquo;d demand it if that were the case. Until we can change the perception of the public to more closely match reality, and make them realize that the harms may outweigh the benefits, we&rsquo;re going to get nowhere in trying to make changes.</p> </blockquote> <p>We're all complicit in the level of overdiagnosis in American health care. Over the past few weeks, I've probably gotten something like $20,000 worth of tests and other care&mdash;with more to come&mdash;in an effort to try and figure out why my breathing suddenly went south. I didn't push back on any of it, and the reason is obvious: when a doctor tells you that your problem <em>might</em> be an embolism or a bad heart or interstitial lung damage, then you damn well want to find out if it is. (It's not. We still don't know what's going on.)</p> <p>Obviously an acute problem like mine is not the same as routine testing. But I do that too. I've resisted the routine colonoscopy so far because my risk profile is low, but I do get a biannual echocardiogram. Why? Because I have high blood pressure, high cholesterol, and a family history of cardio problems. Routine heart monitoring makes sense in my case.</p> <p>Routine mammographies make sense too&mdash;for some women. But for all of them? The best evidence says it doesn't.</p> </body></html> Kevin Drum Health Care Thu, 17 Apr 2014 16:46:30 +0000 Kevin Drum 250026 at http://www.motherjones.com Latest Gallup Result: 9-10 Million Newly Insured Under Obamacare http://www.motherjones.com/kevin-drum/2014/04/latest-gallup-result-12-million-newly-insured-under-obamacare <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Speaking of the uninsured, I inexplicably failed to blog about the <a href="http://www.gallup.com/poll/168548/newly-insured-2014-represent-adults.aspx" target="_blank">latest Gallup results yesterday.</a> Based on polling that goes through mid-April, Gallup now estimates that about 9-10 million people have gained insurance since Obamacare rolled out last year. If you assume that perhaps a million people lost insurance, that's a net increase of 8-9 million. Of this, about half gained insurance through the exchanges. The rest gained it through Medicaid and increased participation in employer plans.</p> <p>I'm not going to try to analyze this number any further. It basically represents good news, since it's a higher estimate than we've seen before, and it also jibes with the recent Rand numbers suggesting a large rise in people covered by employer plans. Apparently the individual mandate is having a bigger impact on this than anybody predicted. However, it's one data point in a noisy series, and I suspect we still have to wait another month to get a reliable set of numbers from all the polling outfits. By the end of May, unless the various polls are in wild disagreement, I imagine we'll have a fairly good idea of just how big the impact of Obamacare has been so far.</p> <p><strong>UPDATE:</strong> Sorry, everyone else has been leading with a number of 12 million, so that's what I used. But the Gallup poll estimates that 4 percent of US <em>adults</em> are newly insured, not 4 percent of the entire country. That's in the range of 9-10 million. I've corrected the text.</p> <p>Note, however, that this ignores children who are newly insured, either via exchanges or Medicaid. So the real number is probably a bit higher. Maybe in the 10-11 million range? It's hard to say. There are a lot of different surveys that are all measuring slightly different things, and they're all working on data that's still incomplete. That's why it's probably wise to wait another month or two before we get too confident in any of these numbers.</p> </body></html> Kevin Drum Health Care Thu, 17 Apr 2014 15:38:43 +0000 Kevin Drum 250006 at http://www.motherjones.com Is the Census Recount of the Uninsured a Legitimate Scandal? http://www.motherjones.com/kevin-drum/2014/04/census-recount-uninsured-legitimate-scandal <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>A friend of mine thinks the decision by the Census Bureau to change the way it counts the uninsured&mdash;which will make it more difficult to make pre and post-Obamacare <img align="right" alt="" class="image image-_original" src="/files/blog_census_informed.jpg" style="margin: 20px 20px 15px 30px;">comparisons&mdash;is sleazier than I give it credit for:</p> <blockquote> <p>To me this is all about 2016. I think Democrats really want to be able to show a sharp contrast that will demonstrate the dramatic impact of an attempted repeal of the ACA, and stronger numbers on the uninsured would only help the ads that much more. The administration knows that a Republican president will be under terrific pressure to undercut and thwart the law regardless of its popularity (even if with as few fingerprints as possible) and that they will use whatever tools they have to do so. So 2016 is extremely important.</p> <p>The reason I lost it is because even with independent agencies, there is a certain measure of influence. No, the executive doesn't have a large measure of direct control over independent agencies, but they damn sure know what they are doing&nbsp;&mdash; or at least somebody does. They don't operate in a vacuum. (Except, perhaps, some of the security services.) So, this is either:</p> <blockquote> <ol> <li>Something started years ago with a drop date of Spring 2014 that (a) no one picked up on until now and no one can derail the train; or (b) the executive saw coming and was willing to let it happen to help put the best read on the numbers in advance of 2016.</li> <li>Something that has been out there (sure, everything is "out there") but languishing, which the executive decided to speed up and put in place well before 2016. The goal was to get the most positive read on the numbers, so they indirectly applied pressure to the Census to put it in place&nbsp;&mdash; and since the Census wants it anyway there's really no stick here.</li> </ol> </blockquote> <p>Of these, (1)(a) seems most implausible (even if certainly possible) and (2) seems most likely if 2016 is the primary issue. Thus, I am assuming that this is going forward with the executive's blessing on the timing, and a calculation has been made that the blowback&nbsp;&mdash; if any&nbsp;&mdash; will be among the right's base and they are already energized so this won't change the dynamic much.</p> <p>And if my assumption is correct, I still think it's a cheap / too-cute-by-half tactic that I would be calling out if the roles were flipped.</p> </blockquote> <p>I have a hard time buying this for several reasons. First, it <em>is</em> too cute by half. Obama's political shop is not the runaway train that, say, Chris Christie's apparently is. It's implausible to me that anyone there would give this more than a moment's thought before dismissing it. It's just too stupid.</p> <p>Second, it's not at all clear that the change made by the Census will make Obamacare look better. We're still going to have a clean 2013-14 comparison, after all, just not a longer-term one. Besides, surely <em>any</em> number is better than one with such a big cloud around it that it's open to merciless attack. Especially when it's one that the boffins at the Census Bureau won't defend.</p> <p>Third, there are loads of other numbers about the uninsured&mdash;Gallup, Rand, HRMS, etc. Playing games with the Census numbers won't change any of that.</p> <p>Bottom line: I continue to think this is most likely something dreamed up by technocrats in the Census Bureau who were oblivious to the political implications. I'll acknowledge that the political implications are obvious enough that this is a little hard to believe, but that's where Occam's Razor takes me. In any case, Darrell Issa is sure to open hearings on this, so I imagine we'll hear from Census officials soon enough.</p> </body></html> Kevin Drum Regulatory Affairs Thu, 17 Apr 2014 15:14:21 +0000 Kevin Drum 249996 at http://www.motherjones.com Putin: Eastern Ukraine is Really "Novorossiya" http://www.motherjones.com/kevin-drum/2014/04/putin-eastern-ukraine-really-novorossiya <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>The <em>Guardian</em> reports that Vladimir Putin held a <a href="http://www.theguardian.com/world/2014/apr/17/vladimir-putin-denies-russian-forces-eastern-ukraine-kiev" target="_blank">long, "meticulously stagecrafted" press conference today:</a></p> <blockquote> <p>Accusing the Kiev authorities of pulling the country into an "abyss", he called on Ukraine to pull back its heavy artillery from the east of the country, asking: "Who are you going to use it against? Have you completely lost your marbles?"</p> <p>....<strong>Putin referred to the region in question by its tsarist name "Novorossiya", or "New Russia", as it was referred to in the 19th century under tsarist rule, and suggested it was a historical mistake to hand it over to Ukraine.</strong></p> <p>"It's new Russia," he told millions of watchers "Kharkiv, Lugansk, Donetsk, Odessa were not part of Ukraine in Czarist times, they were transferred in 1920. Why? God knows. Then for various reasons these areas were gone, and the people stayed there&nbsp;&mdash; we need to encourage them to find a solution."</p> </blockquote> <p>That does not sound very promising, does it?</p> </body></html> Kevin Drum International Thu, 17 Apr 2014 14:36:10 +0000 Kevin Drum 249976 at http://www.motherjones.com Invading Crimea May Have Cost Russia $200 Billion So Far http://www.motherjones.com/kevin-drum/2014/04/invading-crimea-may-have-cost-russia-200-billion-so-far <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Russia's military actions are <a href="http://www.latimes.com/world/europe/la-fg-ukraine-20140417,0,5892399.story#axzz2z72JcgMZ" target="_blank">costing it dearly:</a></p> <blockquote> <p>Russia's annexation of Ukraine's Crimea region last month and the instability it created in Russian financial markets were cited by government officials for record capital flight and sharply downgraded growth forecasts for the country. <strong>Finance Minister Anton Siluanov said that instead of projected 2.5% growth this year, Russia's economy might show no growth at all.</strong></p> <p>....U.S. and European sanctions to punish Russia for occupying and annexing Crimea have so far targeted only a few dozen officials and businessmen. But the prospect of broader penalties, such as a Western boycott of Russian oil and gas, have scared investors into cashing out their ruble-denominated assets for hard currency and taking their money abroad. Russia's foreign exchange reserves were drained of a record $63 billion in the first quarter of the year, Economic Development Minister Alexei Ulyukayev said Wednesday in an address to the lower house of the parliament.</p> <p>....Russian stocks fell 10% last month, wiping out further billions in capital. The ruble has lost 9% of its value since the start of the year, boosting prices for the imported food and manufactured goods on which the Russian consumer market is heavily dependent. "The acute international situation of the past two months" was the cause, Ulyukayev said, referring to the Ukraine unrest.</p> </blockquote> <p>That's a helluva big drop in economic growth. Just by itself, it represents a cost of $50 billion. Add in the flight of cash and the stock market decline, and you're somewhere in the neighborhood of $200 billion.</p> <p>Is that enough to make Russia blink? Maybe not. But it hurts, and the prospect of losing even more has got to be enough to give even Vladimir Putin a few second thoughts.</p> </body></html> Kevin Drum Economy International Thu, 17 Apr 2014 04:07:07 +0000 Kevin Drum 249966 at http://www.motherjones.com An Update From Our 1 Percent World: Southern California Housing Edition http://www.motherjones.com/kevin-drum/2014/04/update-our-1-world-southern-california-housing-edition <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>The <em>LA Times</em> reports that the Southern California housing market is <a href="http://www.latimes.com/business/realestate/la-fi-home-prices-20140416,0,4794538.story#axzz2z4dbbuh0" target="_blank">once again getting frothy:</a></p> <blockquote> <p>But a deeper look at the market reveals a recovery divided between the rich and everyone else.</p> <p>The market for high-dollar homes is hopping, with sales on the rise and buyers launching bidding wars. But sales of low- to medium-priced homes have plummeted during the same period &mdash; with many potential buyers priced out....Those declines came even as sales of high-end homes increased. Sales of homes costing $800,000 or more grew 12%, while sales of homes costing less than $500,000 fell at twice that rate.</p> <p>...."We're getting multiple offers on just about everything," said Barry Sulpor, an agent with Shorewood Realtors in Manhattan Beach, where he said there is a new wave of tear-downs and new construction in prime beachfront locations. "The market is really on fire."</p> </blockquote> <p>I think partly this is a bit of a statistical artifact: a lot of investors were buying cheap houses a year ago, figuring they could rent them out and make a killing. That didn't work out so well, and now a lot of those houses are back on the market. Long story short, some of the increase in low-end housing prices over the past year or two has been a bit of an investor-fueled mirage, and now reality is catching up to that.</p> <p>Still, the overall picture is clear: At the lower end of the market, ordinary people have been increasingly locked out for a while, and that's still the case. Nor is it any surprise. After all, median wages have stagnated during the entire period that we so laughingly refer to as a "recovery." As always in our brave new 1 percent era, things are going pretty well for the rich. For the not-so-rich, not so well.</p> </body></html> Kevin Drum Economy Wed, 16 Apr 2014 18:24:11 +0000 Kevin Drum 249951 at http://www.motherjones.com In Red States, the Uninsured Are Up the Creek http://www.motherjones.com/kevin-drum/2014/04/red-states-uninsured-are-creek <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p><img align="right" alt="" class="image image-_original" src="/files/blog_gallup_uninsurance_embrace_obamacare.jpg" style="border: 1px solid black; margin: 8px 20px 15px 30px;">Gallup has previously reported a drop in the uninsurance rate among Americans following the rollout of Obamacare last year. <a href="http://www.gallup.com/poll/168539/uninsured-rates-drop-states-embracing-health-law.aspx" target="_blank">Today, they broke down these numbers</a> between states that embraced Obamacare by setting up their own exchanges and expanding Medicaid vs. states that have resisted implementing the law.</p> <p>The results are no surprise. States that embraced Obamacare&mdash;which presumably were more committed to public health in the first place&mdash;had lower uninsurance rates to start with <em>and</em> saw bigger declines. The states that resisted were the ones with the biggest uninsurance problems to start with and saw only token declines. In fact, the decline in states that embraced Obamacare was more than triple that in the other states, 2.8 percent vs. 0.8 percent.</p> <p>These numbers will change a bit over the next couple of months as things settle down and signups are complete, but the relative differences will almost certainly remain huge. Republican governors have been almost unanimously dedicated to sabotaging Obamacare and withholding health care from their own residents, and they've been successful. I hope they're proud of themselves.</p> </body></html> Kevin Drum Health Care The Right Wed, 16 Apr 2014 17:03:20 +0000 Kevin Drum 249946 at http://www.motherjones.com LBJ Was Great. LBJ Was Horrible. Deal With It. http://www.motherjones.com/kevin-drum/2014/04/lbj-was-great-lbj-was-horrible-deal-it <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p><img align="right" alt="" class="image image-_original" src="/files/blog_lbj_two_faces_0.jpg" style="border: 1px solid black; margin: 8px 20px 15px 30px;">David Greenberg and Michael Kazin are arguing about whether LBJ was a great president. <a href="http://www.newrepublic.com/article/117388/lbjs-legacy-why-we-need-hold-two-ideas-him-once" target="_blank">Here is Greenberg's wrap-up:</a></p> <blockquote> <p>Maybe our differences really come down to this: For Michael, the enormity of the Vietnam debacle is so great that LBJ must remain forever confined to a historical doghouse. In contrast, I would submit that we have to hold both Johnson&rsquo;s great deeds and his terrible deeds in our minds at the same time. This uneasy position, I think, does more to invite or even demand continued attention to LBJ&rsquo;s presidency from historians. And it implies a moral verdict on the man that is, in my view, ultimately more unsettling than a tout court denial of any esteem for him whatsoever.</p> </blockquote> <p>Yes. A thousand times yes. There's no need to rate LBJ or any other president on a scale from 1 to 10. He was a great president in some areas and a terrible one in others. That's it. You can't put those two things in a blender and come to a single, homogenized conclusion, no matter how badly you want to.</p> <p>This isn't like Mussolini making the trains run on time, or Hitler building the autobahn, trivial achievements that simply don't bear on either man's place in history. LBJ's domestic achievements were gigantic. His foreign policy failures were equally gigantic. That's it. That's what happened, and that's who he is. We just have to live with it.</p> </body></html> Kevin Drum Wed, 16 Apr 2014 15:43:49 +0000 Kevin Drum 249936 at http://www.motherjones.com In War, Truth Is the First Casualty http://www.motherjones.com/kevin-drum/2014/04/war-truth-first-casualty <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>David Herszenhorn reports that Tuesday marked yet another day of "bluster and hyperbole, of the misinformation, exaggerations, conspiracy theories, overheated rhetoric and, occasionally, outright lies" that have marked the <a href="http://www.nytimes.com/2014/04/16/world/europe/russia-is-quick-to-bend-truth-about-ukraine.html?hp&amp;_r=0" target="_blank">Russian response to the crisis in Ukraine:</a></p> <blockquote> <p>It is an extraordinary propaganda campaign that political analysts say reflects a new brazenness on the part of Russian officials. And in recent days, it has largely succeeded &mdash; at least for Russia&rsquo;s domestic audience &mdash; in painting a picture of chaos and danger in eastern Ukraine, although it was pro-Russian forces themselves who created it by seizing public buildings and setting up roadblocks.</p> <p>....To watch the television news in Russia is to be pulled into a swirling, 24-hour vortex of alarmist proclamations of Western aggression, sinister claims of rising fascism and breathless accounts of imminent hostilities by the &ldquo;illegal&rdquo; Ukrainian government in Kiev, which has proved itself in recent days to be largely powerless.</p> <p><strong>The Rossiya 24 news channel, for instance, has been broadcasting virtually nonstop with a small graphic at the bottom corner of the screen that says &ldquo;Ukrainian Crisis&rdquo; above the image of a masked fighter,</strong> set against the backdrop of the red-and-black flag of the nationalist, World War II-era Ukrainian Insurgent Army, which inflicted tens of thousands of casualties on Soviet forces.</p> <p>Over the course of several hours of coverage on Tuesday, Rossiya 24 reported that four to 11 peaceful, pro-Russian &ldquo;supporters of federalization&rdquo; in Ukraine were killed near the town of Kramatorsk in eastern Ukraine when a mixed force of right-wing Ukrainians and foreign mercenaries strafed an airfield with automatic gunfire from helicopter gunships before landing and seizing control.</p> <p>In fact, on the ground, a small crowd of residents surrounded a Ukrainian commander who had landed at the airfield in a helicopter, and while there were reports of stones thrown and shots fired in the air, only a few minor injuries were reported with no signs of fatalities.</p> </blockquote> <p>Thank God we live in America, where this kind of thing doesn't happen.</p> </body></html> Kevin Drum International Media Wed, 16 Apr 2014 15:00:56 +0000 Kevin Drum 249926 at http://www.motherjones.com Unsportsmanlike Conduct in the NBA Follows an Inverted U-Shaped Curve http://www.motherjones.com/kevin-drum/2014/04/unsportsmanlike-conduct-nba-follows-inverted-u-shaped-curve <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Over at 538, Benjamin Morris asks <a href="http://fivethirtyeight.com/features/just-how-bad-were-the-bad-boys/" target="_blank">"Just How Bad Were the Bad Boys?"</a> The bad boys in question are the Detroit Pistons basketball team of the late 80s, who had a reputation for being unusually aggressive on the court. Did they deserve their reputation? To test this, Morris looks at how many technical fouls they racked up, a good measure of unsportsmanlike conduct. In fact, he takes a look at the total number of technical fouls for the entire league, and finds that the number rose steadily until 1995 and then started a long-term decline.</p> <p>I promise this is just for fun, but I've overlaid another line against Morris's chart. Not a perfect fit, granted, but not too far off, either. I'm sure a few of you can guess what it is, can't you?</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_bad_boys_lead_1.jpg" style="border: 1px solid black; margin: 15px 0px 5px 90px;"></p> </body></html> Kevin Drum Science Sports Wed, 16 Apr 2014 05:56:37 +0000 Kevin Drum 249916 at http://www.motherjones.com Medical Inflation Is Up, But It's Probably Just a Blip http://www.motherjones.com/kevin-drum/2014/04/medical-inflation-its-probably-just-blip <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Sarah Kliff reports that health care spending <a href="http://www.vox.com/2014/4/15/5612900/health-spending-growth-fast" target="_blank">ticked upward at the end of 2013:</a></p> <blockquote> <p>A four-year slowdown in health spending growth could be coming to an end....Federal data suggests that health care spending is now growing just as quickly as it was prior to the recession.</p> <p>....The Altarum Institute in Ann Arbor, Mich. tracks health spending growth by month. It saw an uptick in late 2013 that has continued into preliminary numbers for 2014. Separate data from the Bureau of Economic Analysis, which tracks the growth or consumer spending by quarter, shows something similar: health spending grew by 5.6 percent in the last quarter of 2013, the fastest growth recorded since 2004.</p> </blockquote> <p>Inflation in the final quarter of 2013 ran a little over 1 percent, which means health care spending rose 4.5 percent faster than the overall inflation rate. That's a lot. But it's also <img align="right" alt="" class="image image-_original" src="/files/blog_healthcare_cost_growth_small.jpg" style="margin: 20px 5px 15px 30px;">only one quarter, and it's hardly unexpected. Take a look at the chart on the right, which shows how much per capita health care spending has increased over and above the inflation rate for the past 40 years. There are two key takeaways:</p> <ul> <li>Medical inflation has been on a striking long-term downward path since the early 80s.</li> <li>There's a ton of noise in the data, with every decline followed by a subsequent upward correction.</li> </ul> <p>The HMO revolution of the 90s sent medical inflation plummeting. Then a correction. Then another big drop. And another upward correction. Then another drop. If that's followed by an upward correction for a few years, it would hardly be a surprise.</p> <p>Nonetheless, the long-term trend is pretty clear, and it shows up no matter how you slice the data. For many years, medical inflation was running as much as 4-6 percent higher than overall inflation. Today that number is 1-2 percent, and the variability seems to be getting smaller. What's more, that 1-2 percent number matches the long-term trend during the entire postwar period (see chart below). There's good reason to think that it might be the natural rate of medical inflation, with the 80s and early 90s as an outlier. That's where I'd put my money, anyway.</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_real_medical_inflation_long_view.jpg" style="margin: 15px 0px 5px 10px;"></p> </body></html> Kevin Drum Economy Health Care Wed, 16 Apr 2014 01:25:50 +0000 Kevin Drum 249911 at http://www.motherjones.com Donald Rumsfeld Will Never Overpay His Taxes http://www.motherjones.com/kevin-drum/2014/04/donald-rumsfeld-will-never-overpay-his-taxes <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Via Steve Benen, I see that Donald Rumsfeld sends the IRS a letter every year when he files his taxes. <a href="http://www.msnbc.com/rachel-maddow-show/rumsfeld-and-sad-commentary-governance" target="_blank">Here it is:</a></p> <blockquote> <p>I have sent in our federal income tax and our gift tax returns for 2013. As in prior years, it is important for you to know that I have absolutely no idea whether our tax returns and our tax payments are accurate. I say that despite the fact that I am a college graduate and I try hard to make sure our tax returns are accurate.</p> <p>The tax code is so complex and the forms are so complicated, that I know I cannot have any confidence that I know what is being requested and therefore I cannot and do not know, as I suspect a great many Americans cannot know, whether or not their tax returns are accurate. As in past years, I have spent more money that I wanted to....</p> </blockquote> <p>Etc. Two things here:</p> <ul> <li>As a longtime feeder at the public trough, Rumsfeld is surely aware that the IRS isn't responsible for the complexity of the tax code. Congress is. He needs to write an annual letter to his representative in Congress instead. As a resident of Washington DC, of course, he doesn't really have one, but that's a whole different story. However, I'm sure Rep. Eleanor Holmes Norton would be delighted to receive his letter anyway.</li> <li>The big reason taxes are complicated is because people do complicated things with their money&mdash;often with the express aim of lowering their taxes. Nobody is forced to do this. If you want, you can just add up all your income and pay the statutory rate without worrying about deductions and loopholes and capital gains rates and so forth. That will make your taxes easy. But if you're the kind of person who has enough money to hire expensive accountants to manage your carefully tailored investments, then you have enough money to pay those accountants to do your taxes too.</li> </ul> <p>In any case, none of this really matters. No matter how much Rumsfeld pays in taxes, it will never be enough to make up for the damage he's done to this country over his lifetime. He should stop whining. He owes us.</p> </body></html> Kevin Drum Regulatory Affairs Tue, 15 Apr 2014 21:52:21 +0000 Kevin Drum 249901 at http://www.motherjones.com Google Ponders Using Its Search Algorithms to Encourage Encryption http://www.motherjones.com/kevin-drum/2014/04/google-ponders-using-its-search-algorithms-encourage-encryption <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p><a href="http://blogs.wsj.com/digits/2014/04/14/google-may-push-sites-to-use-encryption/?mod=e2tw" target="_blank">From the <em>Wall Street Journal</em>:</a></p> <blockquote> <p>In a move that experts say could make it harder to spy on Web users, <strong>Google is considering giving a boost in its search-engine results to websites that use encryption,</strong> the engineer in charge of fighting spam in search results hinted at a recent conference.</p> <p>The executive, Matt Cutts, is well known in the search world as the liaison between Google&rsquo;s search team and website designers who track every tweak to its search algorithms....Google uses its search algorithm to encourage and discourage practices among web developers. Sites known to have malicious software are penalized in rankings as are those that load very slowly, for instance. In total, the company has over 200 &ldquo;signals&rdquo; that help it determine search rankings, most of which it doesn&rsquo;t discuss publicly.</p> </blockquote> <p>I don't want to make too big a deal out of this, but I'm a little nervous about the power Google is demonstrating here. Google has a <a href="http://searchengineland.com/bing-ends-2013-with-all-time-high-in-us-market-share-but-google-also-up-comscore-181876" target="_blank">two-thirds share of the search market,</a> which makes it an effective monopoly in this space, and they're none too transparent about just how they exploit this dominance. Encrypting web sites is probably a good thing to encourage, but it's hardly necessary for every site. Nor is it clear just what Google would decide counts as proper encryption. Do some encryption standards and suppliers stand or fall based on whether Google's algorithm recognizes them?</p> <p>I haven't given this a ton of thought, so just take this as a bit of noodling. To the extent that Google's algorithms are genuinely aimed at producing the most useful results for people, it's hard to fault them. When they start to go beyond that, though, things get a little gray. What comes next after this? It's worth some thought.</p> </body></html> Kevin Drum Corporations Tech Tue, 15 Apr 2014 17:14:24 +0000 Kevin Drum 249821 at http://www.motherjones.com Fox News Is About to Get a New Pet Rock http://www.motherjones.com/kevin-drum/2014/04/fox-news-about-get-new-pet-rock <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Oh man, a whole new set of conspiracy theories <a href="http://www.nytimes.com/2014/04/16/us/politics/census-survey-revisions-mask-health-law-effects.html?hp&amp;_r=0" target="_blank">is about to take flight:</a></p> <blockquote> <p>The Census Bureau, the authoritative source of health insurance data for more than three decades, is changing its annual survey so thoroughly that it will be difficult to measure the effects of President Obama&rsquo;s health care law in the next report, due this fall, census officials said.</p> <p>....An internal Census Bureau document said that the new questionnaire included a &ldquo;total revision to health insurance questions&rdquo; and, in a test last year, produced lower estimates of the uninsured. Thus, officials said, it will be difficult to say <img align="right" alt="" class="image image-_original" src="/files/blog_conspiracy_theory.jpg" style="margin: 20px 5px 15px 30px;">how much of any change is attributable to the Affordable Care Act and how much to the use of a new survey instrument.</p> <p><strong>&ldquo;We are expecting much lower numbers just because of the questions and how they are asked,&rdquo; said Brett J. O&rsquo;Hara, chief of the health statistics branch at the Census Bureau.</strong> With the new questions, &ldquo;it is likely that the Census Bureau will decide that there is a break in series for the health insurance estimates,&rdquo; says another agency document describing the changes. This &ldquo;break in trend&rdquo; will complicate efforts to trace the impact of the Affordable Care Act, it said.</p> </blockquote> <p>I admit that this sure seems like a bad time to suddenly decide we need a new methodology for counting the uninsured, even if it has been in the works for a while. But it doesn't matter if it's almost certainly bureaucratic inertia at work here, not political skullduggery. The Fox News set is going to have a field day with this. <em>The feds are unskewing their own numbers! Probably on direct orders from the White House!</em> I expect Darrell Issa to commence hearings next week.</p> <p>Yeesh. Can't we just delay these changes for a year or two? Even if the old numbers were inaccurate, it would still be nice to keep a stable baseline for comparison through 2015 or so.</p> </body></html> Kevin Drum Health Care Obama The Right Tue, 15 Apr 2014 16:32:21 +0000 Kevin Drum 249816 at http://www.motherjones.com Is the Crisis in Ukraine About to Wind Down? http://www.motherjones.com/kevin-drum/2014/04/crisis-ukraine-about-wind-down <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>I've been watching the unfolding events in Ukraine with the usual rising mix of apprehension and horror, but I haven't blogged about it much since I don't have anything to add in the way of insight or analysis. <a href="http://www.slate.com/articles/news_and_politics/war_stories/2014/04/vladimir_putin_may_not_invade_ukraine_can_russia_s_president_succeed_without.html" target="_blank">So instead I'll turn the mike over to Fred Kaplan, who does:</a></p> <blockquote> <p>Contrary to appearances, the crisis in Ukraine might be on the verge of resolution. The potentially crucial move came today when interim President Oleksandr Turchynov said that he would be open to changing the country&rsquo;s political system from a republic, with power centered in the capital Kiev, to a federation with considerable autonomy for the regional districts.</p> <p>That has been one of Russian President Vladimir Putin&rsquo;s key demands....If Putin can win this demand&mdash;and the political, economic, and cultural inroads it would provide&mdash;an invasion would be not just be unnecessary, it&rsquo;d be loony. War is politics by other means, and a revamping of Ukraine&rsquo;s power structure would accomplish Putin&rsquo;s political aims by less costly means.</p> <p>....Sending [NATO] fighter aircraft to Poland and the Baltic states, mobilizing warships to the Black Sea, ratcheting up sanctions with threats of more to come&mdash;all this sends a signal that the West won&rsquo;t stand by. In fact, Putin has done more to rivet the NATO nations&rsquo; attention, and perhaps get them to boost their defense budgets, than anything in the past decade.</p> <p>But Obama and the other Western leaders also know they&rsquo;re not going to go to war over Ukraine. Putin knows this, too. At the same time, if he&rsquo;s at all rational (and this is the worrying thing&mdash;it&rsquo;s not clear that he is), Putin would calculate that escalation is not a winning strategy for him. He could invade the eastern slices of Ukraine, especially around Donetsk, but he couldn&rsquo;t go much further. The move would rile the rest of Ukraine to take shelter under the EU&rsquo;s (and maybe NATO&rsquo;s) wing, and it would rouse the Western nations to rearm to an extent unseen in 20 years (and to a level that the Russian economy could not match).</p> </blockquote> <p>I keep thinking that even from a nationalistic Russian point of view, the cost of invading and holding eastern Ukraine is simply too large. The game isn't worth the candle. And yet....who knows? Rationality is sometimes in short supply. I'd still bet against a Russian invasion, especially if Putin can get much of what he wants without it, but it would be a pretty iffy bet.</p> <p>In any case, I wonder how long this "federation" will last? If Putin is smart, he can bide his time and just wait. A federated Ukraine could organically turn into eastern and western Ukraine with a bit of patience and without firing a shot. In the end, that would probably suit Russia's interests better than outright annexation.</p> </body></html> Kevin Drum International Tue, 15 Apr 2014 16:03:05 +0000 Kevin Drum 249806 at http://www.motherjones.com Cliven Bundy Exposes the Cravenness of the Modern Right http://www.motherjones.com/kevin-drum/2014/04/cliven-bundy-exposes-cravenness-modern-right <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>Like a lot of people, Ed Kilgore is distressed at the outpouring of support on the right for <a href="http://www.washingtonmonthly.com/political-animal-a/2014_04/tax_day_and_patriotism049898.php" target="_blank">Nevada rancher Cliven Bundy:</a></p> <blockquote> <p>Call it "individualism" or "libertarianism" or whatever you want, but those who declare themselves a Republic of One and raise their own flags are in a very literal sense being unpatriotic.</p> <p>That's why I'm alarmed by the support in many conservative precincts for the Nevada scofflaws who have been exploiting public lands for private purposes and refuse to pay for the privilege because they choose not to "recognize" the authority of the United States. Totally aside from the double standards involved in expecting kid-glove treatment of one set of lawbreakers as opposed to poorer and perhaps darker criminal suspects, fans of the Bundys are encouraging those who claim a right to wage armed revolutionary war towards their obligations as Americans. It makes me <img align="right" alt="" class="image image-_original" src="/files/blog_bundy_nevada.jpg" style="border: 1px solid black; margin: 20px 20px 15px 30px;">really crazy when such people are described as "superpatriots." Nothing could be more contrary to the truth.</p> </blockquote> <p>The details of the Bundy case have gotten a lot of attention at conservative sites, but the details really don't matter. Bundy has a baroque claim that the United States has no legal right to grazing land in Nevada; for over a decade, every court has summarily disagreed. It's federal land whether Bundy likes it or not, and Bundy has refused for years to pay standard grazing fees&mdash;so a couple of weeks ago the feds finally decided to enforce the latest court order allowing them to confiscate Bundy's cattle if he didn't leave. The rest is just fluff, a bunch of paranoid conspiracy theorizing that led to last week's armed standoff between federal agents and the <a href="http://mediamatters.org/blog/2014/04/10/right-wing-media-are-throwing-gas-on-a-ranchers/198841" target="_blank">vigilante army created by movement conservatives.</a></p> <p>The fact that so many on the right are valorizing Bundy&mdash;or, at minimum, tiptoeing around his obvious nutbaggery&mdash;is a testament to the enduring power of Waco and Ruby Ridge among conservatives. The rest of us may barely remember them, but they're totemic events on the right, fueling Glenn-Beckian fantasies of black helicopters and jackbooted federal thugs for more than two decades now. Mainstream conservatives have pandered to this stuff for years because it was convenient, and that's brought them to where they are today: too scared to stand up to the vigilantes they created and speak the simple truth. They complain endlessly about President Obama's "lawlessness," but <em>this</em> is lawlessness. It's appalling that so many of them aren't merely afraid to plainly say so, but actively seem to be egging it on.</p> </body></html> Kevin Drum Crime and Justice Guns Regulatory Affairs Tue, 15 Apr 2014 15:12:04 +0000 Kevin Drum 249801 at http://www.motherjones.com Blood Moon! http://www.motherjones.com/kevin-drum/2014/04/blood-moon <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>It turns out that timing is everything with the blood moon. We had a thin little haze of clouds passing across the sky here in Irvine, so I couldn't get a very sharp image, but at 11:24 pm, the moon was still disappointingly moon-colored. By 12:03 am, however, it was satisfyingly florid. Enjoy.</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_blood_moon_1.jpg" style="border: 1px solid black; margin: 15px 0px 5px 40px;"><img align="middle" alt="" class="image image-_original" src="/files/blog_blood_moon_2.jpg" style="border: 1px solid black; margin: 15px 0px 5px 40px;"></p> </body></html> Kevin Drum Tue, 15 Apr 2014 07:35:31 +0000 Kevin Drum 249781 at http://www.motherjones.com Big Government Run Amok Decides to Back Down http://www.motherjones.com/kevin-drum/2014/04/big-government-run-amok-decides-back-down <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p><a href="http://www.washingtonpost.com/politics/social-security-stops-trying-to-collect-on-old-taxpayer-debts/2014/04/14/9355c58e-c40f-11e3-bcec-b71ee10e9bc3_story.html?hpid=z1" target="_blank">The <em>Washington Post</em> gets results!</a></p> <blockquote> <p>The Social Security Administration announced Monday that it will immediately cease efforts to collect on taxpayers&rsquo; debts to the government that are more than 10 years old.</p> <p>....&ldquo;I have directed an immediate halt to further referrals under the Treasury Offset Program to recover debts owed to the agency that are 10 years old and older pending a thorough review of our responsibility and discretion under the current law,&rdquo; Social Security&rsquo;s acting commissioner, Carolyn Colvin, said in a statement.</p> </blockquote> <p>So there you have it. If your mother&mdash;<a href="http://www.motherjones.com/kevin-drum/2014/04/file-one-under-big-government-run-amok" target="_blank">maybe, possibly</a>&mdash;got overpaid 40 years ago when you were a five-year-old child, the Social Security Administration will no longer seize your tax refund check in order to recover her alleged debt. Progress!</p> <p>Anyway, Eric Posner says the <a href="http://ericposner.com/can-the-government-recover-from-children-on-account-of-social-security-overpayments-to-their-parents/" target="_blank">government's legal position here was untenable all along.</a> That's good to know.</p> </body></html> Kevin Drum Regulatory Affairs Mon, 14 Apr 2014 22:46:51 +0000 Kevin Drum 249776 at http://www.motherjones.com Today Brings Good News/Bad News on Obamacare http://www.motherjones.com/kevin-drum/2014/04/today-brings-good-newsbad-news-obamacare <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>The CBO released a <a href="http://cbo.gov/sites/default/files/cbofiles/attachments/45231-ACA_Estimates.pdf" target="_blank">small bit of good news/bad news about Obamacare today.</a> The good news: they now estimate that the 10-year cost of the program will be $104 billion less than they previously thought&mdash;which, in turn, was less than they had projected in <img align="right" alt="" class="image image-_original" src="/files/blog_cbo_obamacare_cost.jpg" style="border: 1px solid black; margin: 20px 20px 15px 30px;">2010. This is primarily because exchange premiums have come in lower than CBO originally estimated, which means that federal subsidies will be lower.</p> <p>The bad news: the lower cost of premiums is primarily because the quality of the plans coming from insurers is lower than CBO originally estimated: "The plans being offered through exchanges in 2014 appear to have, in general, lower payment rates for providers, narrower networks of providers, and tighter management of their subscribers&rsquo; use of health care than employment-based plans do. Those features allow insurers that offer plans through the exchanges to charge lower premiums (although they also make plans somewhat less attractive to potential enrollees)."</p> <p>CBO didn't update its projection of Obamacare revenues, but if those don't change, it means that Obamacare will reduce the deficit even more than we thought.</p> <p>But here's an interesting thing: CBO continues to project that Obamacare will lead to no short-term change in employer-based insurance. But the latest Rand poll suggests that <a href="http://www.motherjones.com/kevin-drum/2014/04/heres-some-stunning-and-unexpected-good-news-about-obamacare" target="_blank">employer insurance has <em>increased</em> by about 7 million</a> since Obamacare enrollment started up last year. If that number turns out to be real, I wonder how that will affect CBO's budget estimates? It all depends on how this feeds into their models, but it seems like it would be a positive thing one way or the other.</p> </body></html> Kevin Drum Health Care Mon, 14 Apr 2014 18:02:13 +0000 Kevin Drum 249751 at http://www.motherjones.com How to Lose Money and Come Out OK Anyway http://www.motherjones.com/kevin-drum/2014/04/how-lose-money-and-come-out-ok-anyway <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>TIAA-CREF is buying Nuveen Investments for $6.25 billion from Madison Dearborn, a private equity shop that bought Nuveen in 2007. Nuveen has performed poorly since then, but insiders say that the TIAA-CREF deal ensures that the Madison Dearborn will at least break even on its investment. Felix Salmon is gobsmacked <a href="http://blogs.reuters.com/felix-salmon/2014/04/14/private-equity-math-nuveen-edition/" target="_blank">after running through the numbers:</a></p> <blockquote> <p>So here&rsquo;s my back-of-the-envelope math: you buy a company for $2.7 billion in cash, plus debt which you refinance a few times. While you&rsquo;re running the company, it loses a total of $2.4 billion. And then you sell the company for $1.75 billion in cash. Total going out the door: $5.1 billion. Total coming in, at exit: $1.75 billion. Net loss: some $3.35 billion, give or take.</p> <p>All of which raises some big questions about the WSJ&rsquo;s claim that Madison Dearborn &ldquo;will have at least broken even on its Nuveen investment&rdquo;. If that claim is even close to being true, then at the very least we can&rsquo;t take Nuveen&rsquo;s public filings at face value at all....This is worth remembering, when private-equity types (think Mitt Romney) claim that their interests are aligned with the interests of the companies they buy. That certainly doesn&rsquo;t seem to have been the case here. Nuveen is being sold with about $1.5 billion more debt than it started with, and with cumulative losses under Madison Dearborn&rsquo;s ownership of some $2.4 billion. That&rsquo;s not a great legacy for TIAA-CREF to inherit. <strong>If Madison Dearborn really is breaking even on this deal, that only goes to show the enormous disconnect between the economics of private equity companies &mdash; the wealthy rentiers of society &mdash; versus the economics of the real-world companies they buy and sell.</strong></p> </blockquote> <p>Of course, one possibility is that Madison Dearborn is just putting a brave face on things and reporters are taking it at face value. More likely, though, there are tax games of some kind that allowed Madison Dearborn to strip a ton of value out of Nuveen over the past seven years. I suppose they're also benefiting from low interest rates, which means that Nuveen's refinanced debt is less onerous now than it was in 2007.</p> <p>In any case Salmon's point is well taken. If you can break even after running a company as disastrously as Madison Dearborn has, there's something pretty badly rotten about the entire world of high finance. But then, you knew that already, didn't you?</p> </body></html> Kevin Drum Economy Mon, 14 Apr 2014 15:37:55 +0000 Kevin Drum 249716 at http://www.motherjones.com An Economist Answers Some of My Questions About "Capital in the 21st Century" http://www.motherjones.com/kevin-drum/2014/04/economist-answers-some-my-questions-about-capital-21st-century <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p><img align="right" alt="" class="image image-_original" src="/files/blog_capital_2st_century_english.jpg" style="margin: 8px 25px 15px 35px;"><a href="http://www.motherjones.com/kevin-drum/2014/04/some-follow-notes-thomas-pikettys-capital-21st-century" target="_blank">On Thursday</a> I posted a couple of very rudimentary comments regarding Thomas Piketty's blockbuster new book, <em>Capital in the 21st Century</em>. I had questions about Piketty's estimates of <em>r</em> (return on capital) and <em>g</em> (economic growth) in the past and&mdash;much more importantly&mdash;how they were likely to play out in the future. But all I had were amateur musings because I am, after all, only an amateur.</p> <p>However, yesterday <a href="http://equitablegrowth.org/2014/04/12/notes-finger-exercises-thomas-pikettys-capital-twenty-first-century-honest-broker-week-april-12-2014/" target="_blank">Brad DeLong tackled some of the questions I asked</a> in a far more rigorous and disciplined way, teasing out a lot of unstated implications along the way&mdash;including the importance of various measures of <em>r</em> and how they relate to the probability of increasing future wealth concentration in the real world. It's a long post, and complex in places, but highly recommended. If you're willing to work your way through it, DeLong provides a framework for thinking about Piketty's model that helps you start to make sense of both the book and its conclusions.</p> <p><strong>POSTSCRIPT:</strong> I've gotten a couple of questions about why I seem unduly skeptical, or even harsh, about Piketty's book. It's obviously a landmark work, I don't really mean to be unfair. But it's a book with innovative and untested ideas that has obvious appeal to anyone left of center, and I think this is precisely the time to avoid unquestioning hosannas. Affinity bias makes us all sympathetic to Piketty's arguments, and that's why we should instead question it carefully and thoroughly.</p> </body></html> Kevin Drum Books Economy Sun, 13 Apr 2014 16:40:15 +0000 Kevin Drum 249691 at http://www.motherjones.com It's Finally Time For a New Phone http://www.motherjones.com/kevin-drum/2014/04/its-finally-time-new-phone <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body> <p>So I went out today to my local T-Mobile store to check out the new HTC One, and as far as I'm concerned they ruined it. It's now a gigantic slab, thanks to the 5-inch screen mania that's mowed down everything in its path over the past year. They should have kept the old size, even if it meant the screen might be a mere 4.8 or 4.9 inches.</p> <p>So it's now off my radar, and I'm pretty much thinking I'll go ahead and get a Google Nexus 5 instead. Ironically, it also has a 5-inch screen, but it's nonetheless about the same size as the old HTC One. It's nowhere near as good looking, but it seems to be pretty functional and pretty reasonably priced. Anyone have any reason to warn me away from it?</p> </body></html> Kevin Drum Tech Sun, 13 Apr 2014 03:52:47 +0000 Kevin Drum 249686 at http://www.motherjones.com