Kevin Drum Feed | Mother Jones http://www.motherjones.com/Blogs/2011/08 http://www.motherjones.com/files/motherjonesLogo_google_206X40.png Mother Jones logo http://www.motherjones.com en The Person Who Cares Most About Barack Obama's Approval Rating is Hillary Clinton http://www.motherjones.com/kevin-drum/2014/12/person-who-care-most-about-barack-obamas-approval-rating-hillary-clinton <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Peter Beinart thinks President Obama is due for a comeback. <a href="http://prospect.org/article/barack-obamas-revival-way" target="_blank">Paul Waldman agrees:</a></p> <blockquote> <p>I think Beinart is probably right, and the economy is the main reason; it swamps every other consideration in evaluating the president. We could have some major shock that upends the momentum it has been gaining, but if things proceed for the next two years on the trajectory they're on, the Obama presidency will be one of the best for job creation in recent history. <strong>But it's also important to understand that an Obama revival, should it happen, is going to look different than that of other presidents.</strong></p> </blockquote> <p>In this case, "look different" means that even in the best case Obama will end his presidency with approval ratings in the mid-50s, but no higher. The country is just too polarized to produce anything better. Conservatives of nearly all stripes are going to disapprove of Obama come hell or high water, and that puts a ceiling on how high his approval rating can go. Ditto for any other president these days.</p> <p>But it's true that the economy seems to be doing pretty well these days, and it's usually the economy that drives approval ratings. That's good news for Obama, but it's far better news for Hillary Clinton. For Obama, leaving office with a strong economy is nice for his legacy, but that's about it. For Hillary, it almost certainly means the difference between winning and losing the presidency. If the economy is sluggish or worse in 2016, there's simply no way she overcomes voter fatigue toward Democratic rule. But if the economy is ticking along strongly, she just might.</p> <p>So that's that. The person who cares most about Obama's approval rating isn't Barack Obama. It's Hillary Clinton. It's the tailwind she needs if she wants to become the first woman to occupy the Oval Office.</p></body></html> Kevin Drum 2016 Elections Hillary Clinton Obama Wed, 17 Dec 2014 18:41:10 +0000 Kevin Drum 266841 at http://www.motherjones.com Battered Ruble Stabilizes -- For Now http://www.motherjones.com/kevin-drum/2014/12/battered-ruble-stabilizes-now <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>I promise not to post this chart every day, but since I've put it up for the past two days when the ruble was crashing, I figure I should let everyone <img align="right" alt="" class="image image-_original" src="/files/blog_ruble_dollar_2014_12_17.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">know when the crash has halted. For a few hours, anyway, <a href="http://www.wsj.com/articles/ruble-volatile-in-early-trading-1418802891?mod=WSJ_hp_LEFTWhatsNewsCollection" target="_blank">thanks to some dubious measures from Russian banking authorities:</a></p> <blockquote> <p>The currency was trading 8% stronger against the dollar at 62.1 on the Moscow exchange, while Russia&rsquo;s RTS Index was up 17%, after the central bank eased regulations on the banking system in a bid to provide some relief on capital adequacy for banks and convince Russians to keep their money in rubles.</p> <p>Measures including allowing banks not to take provisions against souring loans and weakening assets they hold, and allowing lenders to use last quarter&rsquo;s exchange rate when settling some foreign-exchange transactions.</p> </blockquote> <p>I'm not sure that loosening banking regulations is a great response to a currency crisis, but I guess you never know. In any case, it seems to have stabilized things for the time being. In the longer term, storm clouds are still brewing. Stay tuned.</p></body></html> Kevin Drum Economy International Wed, 17 Dec 2014 16:49:49 +0000 Kevin Drum 266821 at http://www.motherjones.com Surprise! Obama Plans to Normalize Relations With Cuba. http://www.motherjones.com/kevin-drum/2014/12/surprise-obama-plans-normalize-relations-cuba <!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.motherjones.com/kevin-drum/2014/12/sure-why-shouldnt-obama-normalize-relations-cuba" target="_blank">A couple of weeks ago,</a> <em>National Review's</em> Jay Nordlinger suggested that maybe President Obama's next executive action would be normalization of relations with Cuba. That struck me as something out of left field, since I'd heard not even a hint of a <img align="right" alt="" class="image image-_original" src="/files/images/Blog_Visit_Cuba.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">peep of a rumor that anything along these lines was in the works. But congratulations Jay! <a href="http://www.wsj.com/articles/american-alan-gross-released-from-cuba-after-5-years-in-prison-1418825981?mod=WSJ_hpp_LEFTTopStories" target="_blank">You were right:</a></p> <blockquote> <p>The United States will restore full diplomatic relations with Cuba and open an embassy in Havana for the first time in more than a half century after the release of an American contractor held in prison for five years, American officials said Wednesday.</p> <p>In a deal negotiated during 18 months of secret talks hosted largely by Canada and encouraged by Pope Francis who hosted a final culminating meeting at the Vatican, President Obama and President Raul Castro of Cuba agreed in a telephone call to put aside decades of hostility to find a new relationship between the island nation just 90 minutes off the American coast.</p> <p>....The United States will ease restrictions on remittances, travel and banking relations and Cuba will release 53 Cuban prisoners identified as political prisoners by the United States government. Although the decades-old American embargo on Cuba will remain in place for now, the administration signaled that it would welcome a move by Congress to ease or lift it should lawmakers choose to.</p> </blockquote> <p>Oddly enough, I don't see any reaction yet from Nordlinger, or indeed, from anyone over at <em>National Review</em>. Perhaps the intercession of Pope Francis is giving them pause?</p> <p>In any case, this is good news. I don't personally care an awful lot about Cuba or our relations with them, but half a century of pointless enmity really ought to be enough. Fidel Castro may not have been an admirable guy, but&nbsp;Fulgencio Batista was no great shakes either, and it's long past time to stop pining away for the days when he was in power. So let it go, folks. We don't have to approve of everything Cuba does in order to act like adults and conduct normal relations on both sides. We manage to do it with Russia and Venezuela and Pakistan, after all.</p> <p>In any case, that's that. The next step is lifting the trade embargo, but I suppose it's unlikely that a Republican Congress is going to act on that any time soon. Too bad. There's no longer any reason for it, and I'll bet the majority of cigar smokers are Republicans. They want their Havanas, so lifting the embargo would, in a sense, be nothing more than a routine bit of base maintenance. Perhaps if Republicans think of it as just another political payoff for their strongest supporters, they can be talked into it.</p></body></html> Kevin Drum International Wed, 17 Dec 2014 16:31:38 +0000 Kevin Drum 266811 at http://www.motherjones.com Wall Street Salivating Over Further Destruction of Financial Reform http://www.motherjones.com/kevin-drum/2014/12/wall-street-salivating-over-further-destruction-financial-reform <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Conventional pundit wisdom suggests that Wall Street may have overreached last week. Yes, they won their battle to repeal the swaps pushout requirement in Dodd-Frank, but in so doing they unleashed Elizabeth Warren and brought far more attention to their shenanigans than they bargained for. They may have won a battle, but with the public now suitably outraged and alert for further mischief, they're unlikely to keep future efforts to weaken financial reform behind the scenes, where they might have a chance to pass with nobody the wiser.</p> <p>Then again, maybe not. Maybe it was all just political theater and Wall Street lobbyists know better than to take it seriously. Ed Kilgore points to <a href="http://thehill.com/policy/finance/227363-emboldened-wall-street-ready-to-dismantle-dodd-frank-financial-law" target="_blank">this article in <em>The Hill</em> today:</a></p> <blockquote> <p><strong>Banks and financial institutions are planning an aggressive push to dismantle parts of the Wall Street reform law when Republicans take control of Congress in January.</strong></p> <p>Fresh off a victory in the government funding debate that liberals decried as a giveaway to Wall Street, advocates for the financial sector aim to pursue additional changes to Dodd-Frank that they say would lighten burdens created by the 2010 law. <strong>Among the top items on the wish list: easing new requirements on mortgages, loosening restrictions on financial derivatives and overhauling the Consumer Financial Protection Bureau....</strong><strong>Another fight on the horizon is the push for &ldquo;regulatory relief,&rdquo;</strong> as financial institutions and Republicans seek to require agencies to pursue more cost-benefit analysis when writing rules.</p> <p>....In the face of loud opposition, financial lobbyists say they have a compelling case for revisiting the law. While the economy is improving, they argue the new rules have made it exceedingly difficult to obtain loans, including mortgages.</p> </blockquote> <p>Will Democrats in the Senate manage to stick together and filibuster these efforts to weaken Dodd-Frank? Or will enough of them peel off to allow some of them to pass? I'd like to think that Elizabeth Warren has made unity more likely, but then again, I have an uneasy feeling that Wall Street lobbyists might have a better read on things than she does. Dodd-Frank has already been weakened substantially in the rulemaking process, and this could easily represent a further death by a thousand cuts. After all, as the Wall Street flacks say, the economy is improving. And who needs a bunch of fussy rules when the economy is good?</p></body></html> Kevin Drum Congress Economy Regulatory Affairs Wed, 17 Dec 2014 15:37:46 +0000 Kevin Drum 266796 at http://www.motherjones.com Republicans Cave In, Begin Traditional Holiday Backbiting, and Head For Home http://www.motherjones.com/kevin-drum/2014/12/republicans-cave-backbite-head-home <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Earlier today, Harry Reid pushed through Senate confirmations of Tony Blinken to be deputy secretary of State and Sarah Salda&ntilde;a to head up Immigration and Customs Enforcement. At that point, Republicans, finally tired of staying in <img align="right" alt="" class="image image-_original" src="/files/images/Blog_US_Capitol_0.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">session and convinced that Reid wasn't bluffing about continuing to hold confirmation votes, <a href="http://www.politico.com/story/2014/12/sarah-saldana-confirmed-immigration-and-customs-enforcement-113612.html?hp=t4_r" target="_blank">caved in:</a></p> <blockquote> <p><strong>Dozens of nominees were confirmed unanimously or by voice vote</strong> as the clock ticked on, building on Democrats&rsquo; progress pushing through several bitterly contested nominations during the last days of their majority. After fighting Democrats tooth and nail for more than a year on lifetime judicial appointments, <strong>Republicans waved the white flag on fighting Reid&rsquo;s attempts to confirm a dozen judicial nominations and allowed eleven of them to go through without dissent.</strong></p> </blockquote> <p>Wait. <em>Dozens</em> of nominees? <a href="http://www.washingtonpost.com/politics/another-republican-upends-the-senates-year-end-plans/2014/12/16/127292d8-8559-11e4-9534-f79a23c40e6c_story.html?hpid=z3" target="_blank">How many dozen?</a></p> <blockquote> <p>Democrats controlling the Senate also <strong>secured agreements from Republicans to confirm at least six dozen of President Obama&rsquo;s nominees</strong> to serve as federal judges, agency bosses and on myriad government boards, a last-minute coup for the White House since most of the picks faced tougher odds next year once Republicans take full control of Capitol Hill.</p> </blockquote> <p>And of course everyone knows <a href="http://www.nytimes.com/2014/12/17/us/politics/with-the-way-eased-two-more-obama-nominees-win-approval-from-senate.html?hp&amp;action=click&amp;pgtype=Homepage&amp;module=second-column-region&amp;region=top-news&amp;WT.nav=top-news&amp;_r=0" target="_blank">who to thank for all this:</a></p> <blockquote> <p>Most of the day was consumed with nominations, none more irritating to many Republicans than the ones who received a vote because of an impulsive move by one of their colleagues. <strong>And with the book now closed on the 113th Congress, they could go down as the Cruz Confirmations</strong> &mdash; the batch of the president&rsquo;s nominees who were confirmed by the Senate only after Senator Ted Cruz, Republican of Texas, forced his colleagues to stay in session for 10 hours on a bleak December Saturday.</p> <p>&ldquo;No, we would not have had all of these 24 confirmations, and I think most people know that,&rdquo; said Senator Orrin G. Hatch, Republican of Utah, referring to the two dozen nominees that Senator Harry Reid of Nevada, the majority leader, forced votes once Mr. Cruz made his move.</p> </blockquote> <p>Merry Christmas!</p></body></html> Kevin Drum Congress Wed, 17 Dec 2014 06:09:11 +0000 Kevin Drum 266776 at http://www.motherjones.com On Torture, Dick Cheney Isn't the Problem. We Are. http://www.motherjones.com/kevin-drum/2014/12/torture-dick-cheney-isnt-problem-we-are <!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_pew_poll_torture.jpg" style="border: 1px solid black; margin: 8px 0px 15px 30px;"><a href="http://www.nationalreview.com/corner/394773/interrogation-verdict-rich-lowry" target="_blank">Rich Lowry is a satisfied man:</a></p> <blockquote> <p>After a week of condemnations of the CIA interrogation program, and talk everywhere of how it violated our values and weakened our standing in the world, the verdict of public opinion is in: People support it....In the case of <em>Cheney v. Feinstein</em>, Cheney wins&mdash;at least with the public.</p> </blockquote> <p>This is the most discouraging part of the whole torture debate. It's one thing to learn that Dick Cheney is every bit the vicious wretch we all thought he was. But time after time since 9/11, polls have shown that the American public is basically on his side. As a nation, we simply don't believe that a comprehensive program of state-sanctioned torture is wrong. On the contrary: we think it's just fine as long as it's done to other people. If we're a Christian nation, as we're so often reminded, we're still an Old Testament one.</p></body></html> Kevin Drum Human Rights Tue, 16 Dec 2014 23:50:50 +0000 Kevin Drum 266766 at http://www.motherjones.com The Great Paradox of Bitcoin: If It Ever Succeeds, It's Doomed http://www.motherjones.com/kevin-drum/2014/12/great-paradox-bitcoin-if-it-ever-succeeds-its-doomed <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Will Bitcoin ever become a major competitor to the world's more conventional currencies? It certainly has some advantages over existing payment networks, thanks partly to its technical structure and partly to the fact that it's largely free of regulation. But Henry Farrell argues that <a href="http://www.washingtonpost.com/blogs/monkey-cage/wp/2014/12/16/bitcoins-financial-network-is-doomed/" target="_blank">its freedom from regulation is a chimera:</a></p> <blockquote> <p>Up to this point, regulators have largely tolerated Bitcoin as a curiosity and experiment....But if Bitcoin were ever to threaten to become a truly decentralized payments network, owned by no one, and with no one e.g. capable of implementing Know Your Customer rules, regulators <em>would</em> know very well what to do with it. <strong>They&rsquo;d introduce regulatory guidances and pass laws to freeze it off from the regular financial system.</strong> Very possibly, Bitcoin could still survive at the margins (as the Hawala system has survived). However, it would be isolated, and in no position to <img align="right" alt="" class="image image-_original" src="/files/blog_bitcoin.jpg" style="margin: 20px 0px 15px 30px;">threaten Visa or Mastercard, let alone the underlying payment and messaging services that really underpin the world financial system.</p> <p>If Tim Lee and other Bitcoin fans want to make the case that Bitcoin can become a major payment network, they need to do one of two things. First, they could show that the U.S. and other major states would not feel threatened by a well-established payment system that they couldn&rsquo;t control. Second, they could show that a Bitcoin financial network would survive the opposition of hostile states that have enormous control over the actually-existing financial systems that Bitcoin needs to connect to, as well as regulators, police, etc. I don&rsquo;t see any very plausible arguments that would support either claim. It&rsquo;s perfectly possible that the underlying technologies of Bitcoin (which help solve some interesting problems of trust and exchange) can be deployed to other valuable uses. <strong>But Bitcoin is doomed as a payments network &mdash; the very point at which it looks as though it is likely to be widely deployed is the point at which governments, like that of the United States, will crack down on it.</strong></p> </blockquote> <p>This is almost certainly correct, and the interesting question, I think, is whether Bitcoin and its ilk can figure out ways to operate on a large scale without being effectively shut down by real-world governments. At the moment, I don't see any way they can do that, but it's not impossible that this will change in the future.</p> <p>The evolution of the internet itself provides conflicting guidance as an analogy. Generally speaking, national governments have had considerable difficulty regulating internet content. It's just too distributed and fast moving. So perhaps digital payment networks similar to Bitcoin will eventually thrive because they pose similar problems to would-be regulators. Like kudzu, they'll simply be impossible to contain.</p> <p>On the other hand, countries like China have shown that internet content <em>can</em> be regulated. It merely requires sufficient motivation. And even less authoritarian governments have managed to throw a lot of sand in the gears when they rouse themselves to action. Given that regulating commerce and money is easier than regulating content, this bodes ill for the future of Bitcoin. There's not much question that it can harried into uselessness if national governments decide to do it.</p> <p>Still, there are lots of currencies in the world, and it's possible that a medium-scale version of Bitcoin could stay alive by remaining fairly modest in its connection to any one currency, but fairly large when all of its connections to all the world's currencies are added up. This might cause problems of coordinated action that would end up defeating national regulators, especially if there were dozens or hundreds of different digital currencies to deal with. Maybe. Possibly. I'm not sure if the arithmetic here would ever add up to anything significant, but I'm also not sure it's impossible.</p> <p>But if I had to put money on it? I'd say Bitcoin is doomed in the medium-term future. Farrell is right: it can be a bit of a curiosity, but if it ever enjoys wider success, that very success will kill it.</p></body></html> Kevin Drum Economy International Tue, 16 Dec 2014 19:55:47 +0000 Kevin Drum 266746 at http://www.motherjones.com This Little History Lesson Should Terrify Vladimir Putin http://www.motherjones.com/kevin-drum/2014/12/it-may-not-be-1989-russia-it-sure-looks-close-cousin <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Why did the Soviet Union lose control of its satellite states behind the Iron Curtain in 1989? Lots of reasons, but the proximate cause was a disastrous war in Afghanistan; plummeting oil prices; and a resulting economic crisis. <a href="http://www.aei.org/feature/the-soviet-collapse/" target="_blank">Here is Yegor Gaidar:</a></p> <blockquote> <p>The timeline of the collapse of the Soviet Union can be traced to September 13, 1985. On this date, Sheikh Ahmed Zaki Yamani, the minister of oil of Saudi Arabia, declared that the monarchy had decided to alter its oil policy radically. The Saudis stopped protecting oil prices, and Saudi Arabia quickly regained its <img align="right" alt="" class="image image-_original" src="/files/blog_kremlin_night.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">share in the world market. During the next six months, oil production in Saudi Arabia increased fourfold, <strong>while oil prices collapsed by approximately the same amount in real terms.</strong> As a result, the Soviet Union lost approximately $20 billion per year, money without which the country simply could not survive.</p> <p>The Soviet leadership was confronted with a difficult decision on how to adjust....Instead of implementing actual reforms, the Soviet Union started to borrow money from abroad while its international credit rating was still strong. <strong>It borrowed heavily from 1985 to 1988, but in 1989 the Soviet economy stalled completely. The money was suddenly gone.</strong> The Soviet Union tried to create a consortium of 300 banks to provide a large loan for the Soviet Union in 1989, but was informed that only five of them would participate and, as a result, the loan would be twenty times smaller than needed.</p> <p>The Soviet Union then received a final warning from the Deutsche Bank and from its international partners that the funds would never come from commercial sources. Instead, if the Soviet Union urgently needed the money, it would have to start negotiations directly with Western governments about so-called politically motivated credits. <strong>In 1985 the idea that the Soviet Union would begin bargaining for money in exchange for political concessions would have sounded absolutely preposterous to the Soviet leadership. In 1989 it became a reality, and Gorbachev understood the need for at least $100 billion from the West to prop up the oil-dependent Soviet economy.</strong></p> <p>....Government-to-government loans were bound to come with a number of rigid conditions. For instance, if the Soviet military crushed Solidarity Party demonstrations in Warsaw, the Soviet Union would not have received the desperately needed $100 billion from the West....The only option left for the Soviet elites was to begin immediate negotiations about the conditions of surrender. Gorbachev did not have to inform President George H. W. Bush at the Malta Summit in 1989 that the threat of force to support the communist regimes in Eastern Europe would not be employed. This was already evident at the time. Six weeks after the talks, no communist regime in Eastern Europe remained.</p> </blockquote> <p>This sounds awfully familiar, doesn't it? War, sanctions, an oil crash, and finally bankruptcy. And while history may not repeat itself, it sure does rhyme sometimes: 25 years later Vladimir Putin has managed to back himself into a situation surprisingly similar to the one that led to the end of the Soviet Union and the final victory of the West&mdash;the very event that's motivated almost everything he's done over the past few years. This is either ironic or chilling, depending on your perspective.</p></body></html> Kevin Drum Economy International Tue, 16 Dec 2014 17:58:43 +0000 Kevin Drum 266716 at http://www.motherjones.com Gouging the Gougeable: Yet Another Triumph of the American Health Care System http://www.motherjones.com/kevin-drum/2014/12/gouging-gougeable-yet-another-triumph-american-health-care-system <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Len Charlap has had a couple of outpatient echocardiograms recently. <a href="http://www.nytimes.com/2014/12/16/health/the-odd-math-of-medical-tests-one-echocardiogram-two-prices-both-high.html?hp&amp;action=click&amp;pgtype=Homepage&amp;module=second-column-region&amp;region=top-news&amp;WT.nav=top-news" target="_blank">Elisabeth Rosenthal tallies up the damage:</a></p> <blockquote> <p>The five hospitals within a 15-mile radius of Mr. Charlap&rsquo;s home here charge an average of about $5,200 for an echocardiogram, according to an analysis of Medicare&rsquo;s database. The seven teaching hospitals in Boston, affiliated with Harvard, Tufts and Boston University, charge an average of about $1,300 for the same test. There are even wide variations within cities: <strong>In Philadelphia, prices range from $700 to $12,000.</strong></p> <p>....In other countries, regulators set what are deemed fair charges, which include built-in profit. <strong>In Belgium, the allowable charge for an echocardiogram is $80, and in Germany, it is $115.</strong> In <img align="right" alt="" class="image image-_original" src="/files/blog_portable_echo.jpg" style="margin: 20px 0px 15px 30px;">Japan, the price ranges from $50 for an older version to $88 for the newest, Dr. Ikegami said.</p> <p>Because Mr. Charlap, 76, is on Medicare, which is aggressive in setting rates, <strong>he paid only about $80 toward the approximately $500 fee Medicare allows.</strong> But many private insurers continue to reimburse generously for echocardiograms billed at thousands of dollars, said Dr. Seth I. Stein, a New York physician who researches data on radiology. Hospitals pursue patients who are uninsured or underinsured for those payments, he added.</p> </blockquote> <p>This is now such a common story that it's hard to work up the outrage it deserve. Is this practice corrupt? Merely venal? Or just crazy? I don't even know anymore. What I do know is that if an outpatient echo costs $80 in Belgium and $500 via Medicare, there's no conceivable justification for a $5,200 charge. It bears no relationship to the actual cost of the test, and is designed primarily to gouge the occasional uninsured patient who has no choice in the matter along with the (inexplicable) occasional insurance company willing to pony up even for obviously outrageous charges. One of the hospitals that performed an echocardiogram on Charlap didn't even bother denying that this is what they're doing:</p> <blockquote> <p>In a statement, the hospital in Princeton that performed Mr. Charlap&rsquo;s first, more expensive echocardiogram noted that &ldquo;the vast majority of customers&rdquo; paid much less than the listed prices. It added that its pricing reflected the need to offset losses because many programs, including Medicare, reimburse less than the cost of delivering services.</p> </blockquote> <p>I doubt that Medicare is reimbursing less than the cost of performing an echocardiogram, but you can see what's going on here. The "vast majority" of patients do indeed pay far less than list price. So why have such a high list price? In order to gouge the tiny minority who are gougeable.</p> <p>It's lovely the way American medicine works, isn't it?</p></body></html> Kevin Drum Health Care Tue, 16 Dec 2014 17:12:00 +0000 Kevin Drum 266711 at http://www.motherjones.com The Ruble Continues Its Free Fall http://www.motherjones.com/kevin-drum/2014/12/ruble-continues-its-free-fall <!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_ruble_2014_12_16.jpg" style="border: 1px solid black; margin: 8px 0px 15px 30px;">Well, we have our answer: the Russian central bank's last-ditch effort to stop capital flight didn't work. It was indeed taken by the market as a sign of desperation, not strength. The ruble recovered a bit right after the surprise interest hike in the middle of the night, but by mid-morning panic had settled back in and the ruble was once again in free fall. Even the enticement of 17 percent interest wasn't enough incentive for people to <a href="http://www.wsj.com/articles/russian-ruble-rallies-after-interest-rate-rise-1418715476?mod=WSJ_hpp_LEFTTopStories" target="_blank">keep their rubles in Russian banks:</a></p> <blockquote> <p>By early afternoon in Moscow, the ruble dropped sharply, reaching 80 to the dollar, a record low and a 35% decline from opening levels when it rallied briefly. At 1630 local time, the dollar was trading around 73 rubles....Deputy Chairman Sergei Shvetsov called the situation &ldquo;critical,&rdquo; the Interfax news agency reported. &ldquo;At lot of (market) participants are in serious condition because of these events.&rdquo;</p> <p>&ldquo;The choice the central bank made (to raise rates) was between very bad and very, very bad,&rdquo; he said, noting that the bank could yet take more measures to stabilize the market....Economists warned that the central bank appeared to be losing control of the market and might have no alternative but to restrict trading. &ldquo;Capital controls as a policy measure cannot be off the table now,&rdquo; said Citigroup&rsquo;s Mr. Costa.</p> </blockquote> <p>Stay tuned.</p></body></html> Kevin Drum Economy International Tue, 16 Dec 2014 15:50:56 +0000 Kevin Drum 266701 at http://www.motherjones.com Quote of the Day: Russian Central Bank Decides It Needs to Destroy the Economy In Order to Save It http://www.motherjones.com/kevin-drum/2014/12/russian-central-bank-decides-it-needs-destroy-economy-order-save-it <!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.nytimes.com/2014/12/16/upshot/vladimir-putin-vs-the-currency-markets-what-to-know-about-the-rubles-collapse.html?partner=rss&amp;emc=rss" target="_blank">From Neil Irwin,</a> commenting on the huge interest rate jump announced by Russia's central bank in the wee hours of the morning:</p> <blockquote> <p>It may go without saying, but a 6.5 percentage point emergency interest rate increase announced in the middle of the night is not a sign of strength.</p> </blockquote> <p>Roger that. Russian central bankers hope that this will be an incentive for people to keep their money in Russia, earning high interest, instead of shipping rubles out of the country at warp speed and squirreling them away in any safe haven that comes to hand. And maybe it will work. Alternatively, as Irwin suggests, it may be viewed as a sign of desperation, causing Russia's oligarchs to pile on the dilithium crystals and ship out their money even faster. You never know what's going to work when a currency crisis goes into panic mode.</p> <p>In any case, even if it works, the price is going to be high. Here in America, we argue about whether the Fed will choke off recovery if it raises interest rates to 2 percent. Russia is now at 17 percent. Even if this puts a halt to currency flight, it's going to kill their economy. In Russia tonight, there are no good options left.</p></body></html> Kevin Drum Economy International Tue, 16 Dec 2014 02:05:42 +0000 Kevin Drum 266676 at http://www.motherjones.com The Lima Climate Talks Actually Produced Something Important: An Idea http://www.motherjones.com/kevin-drum/2014/12/lima-climate-talks-actually-produced-something-important-idea <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>So what should we think about the recently concluded climate talks in Lima? They were, as usual, a dog's breakfast. Rich countries fought their usual battles with poor ones. The talks nearly foundered completely. Over the weekend the wording of the draft agreement went from "weak to weaker to weakest," <a href="http://abcnews.go.com/International/wireStory/climate-talks-deadlocked-27584788" target="_blank">in the words of Sam Smith,</a> chief of climate policy for the environmental <img align="right" alt="" class="image image-_original" src="/files/blog_lima_climate_cop20.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">group WWF. And in the end, no legally binding limits were set on greenhouse gas emission.</p> <p>That sounds pretty bad. And yet, something important happened in Lima. As weak as the final language turned out, it does do one thing: it asks every country on the planet to submit a plan to reduce its greenhouse gas emissions. It doesn't mandate what the plans should be. It doesn't require any independent review of the plans. It doesn't set out any timetables. <em>But it does require a plan from everyone.</em></p> <p>This is something new. It may not be legally binding, but then, no agreement was ever likely to be. For the first time ever, though, Lima enshrines the idea that every country should have a plan to fight climate change. This is similar to Obamacare, which is flawed in dozens of ways but, for the first time in American history, enshrined in law the idea that everyone should have access to affordable health coverage. Once you do that&mdash;once you get that kind of public agreement to an idea&mdash;you can use it as a building block. Eventually Obamacare will become universal health care. In the same way, Lima may eventually be the building block that produces a universal agreement to fight climate change on a global scale.</p> <p>This is a fairly rosy view of the Lima agreement, and I don't want to oversell it. Still, the mere principle that every country on the globe should have a formal plan to reduce greenhouse gas emissions is important. Once the plans are in place, they become a concrete starting point for climate activists everywhere. And then they go from weakest to weaker to weak to something that's actually meaningful. Everywhere.</p> <p>It's not enough. But it's something.</p></body></html> Kevin Drum Climate Change Mon, 15 Dec 2014 20:42:01 +0000 Kevin Drum 266641 at http://www.motherjones.com The Russian Ruble Is Now Entering Free Fall http://www.motherjones.com/kevin-drum/2014/12/russian-ruble-now-entering-free-fall <!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_dollar_ruble_2014_12_15.jpg" style="border: 1px solid black; margin: 8px 0px 15px 30px;">Speaking of a possible economic crisis in Russia, it looks like the <a href="http://www.wsj.com/articles/russian-rubles-rout-continues-1418652153?mod=WSJ_hp_LEFTTopStories" target="_blank">ruble is now entering free fall:</a></p> <blockquote> <p>For months, Russia&rsquo;s ruble has been falling in line with a decline in oil. But now, the selloff has stepped up a gear amid a broad rout in emerging-market currencies. Monday, the dollar shot above 63 against the battered Russian currency....&ldquo;There&rsquo;s no relief in sight, the mood on the market is pessimistic. Any recovery in the ruble is used to buy into foreign currencies,&rdquo; said Igor Akinshin, a trader at Alfa Bank.</p> <p>....The country&rsquo;s bond markets are also under strain. Russia&rsquo;s dollar bond maturing in Sept. 2023 is yielding 7.102%, up from 6.633% on Friday.</p> </blockquote> <p>It's above my pay grade to speculate on how this ends. But it's worth keeping an eye on.</p></body></html> Kevin Drum Economy International Mon, 15 Dec 2014 17:52:40 +0000 Kevin Drum 266616 at http://www.motherjones.com No, the Tea Party Is Never Going to Join Up With Anti-Corporate Liberals http://www.motherjones.com/kevin-drum/2014/12/no-tea-party-never-going-join-anti-corporate-liberals <!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.washingtonmonthly.com/political-animal-a/2014_12/elizabeth_warrens_real_and_ima053316.php" target="_blank">This really can't be said often enough:</a></p> <blockquote> <p>I'm afraid we need to call B.S. on this idea of Elizabeth Warren (or any other "populist") becoming a pied piper to the Tea Folk, pulling them across the barricades to support The Good Fight against "crony capitalism." Yes, many "constitutional conservatives" oppose<iframe align="right" allowfullscreen="" frameborder="0" height="258" src="http://www.youtube.com/embed/DJpTxONxvoo" style="margin: 20px 20px 15px 30px;" width="400"></iframe>corporate bailouts. But they also typically support eliminating not just subsidies but regulation of big banks and other corporations.</p> </blockquote> <p>That's from Ed Kilgore, and he's responding to the suggestion that the <em>real</em> divide in American politics isn't between left and right, it's between pro-corporate and anti-corporate. Spare me. Sure, the tea partiers opposed TARP and were hazily in favor of just letting all the banks collapse in 2008, but that was little more than a fleeting morsel of emotional outrage. As Kilgore says, tea partiers may <em>say</em> they oppose corporate power, but when it comes time to vote, they can be counted on to support the folks who oppose any and all regulations that might actually rein in the power of corporations generally and Wall Street in particular.</p> <p>But every once in a while they'll get themselves exercised over some trivial issue of "crony capitalism" like reauthorizing the Export-Import bank, and suddenly pundits will rediscover the supposedly populist right. Give it a rest, folks. The tea partiers will no sooner find common cause with Elizabeth Warren than they will with <em>Mother Jones</em>. In reality, they couldn't care less about ExIm or the swaps pushout or any of the other shiny objects that right-wing fundraisers occasionally find useful for replenishing their coffers. On the economic side of things, what they care about are low taxes and slashing welfare. On the social side of things, they care about abortion, guns, gays, and the moral decay of everyone else. The rest is just fluff.</p></body></html> Kevin Drum Economy The Right Mon, 15 Dec 2014 17:17:55 +0000 Kevin Drum 266606 at http://www.motherjones.com Here's Why Banks Care About Gutting Dodd-Frank http://www.motherjones.com/kevin-drum/2014/12/heres-why-banks-care-about-gutting-dodd-frank <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Elizabeth Warren got a lot of attention last week for rallying liberals against a provision of the cromnibus spending bill that repealed a portion of the Dodd-Frank financial reform bill. This particular bit of the law had required FDIC-insured banks to get out of the custom swaps business. If they wanted to buy and sell risky derivatives, the parent company needed to do it at a separate entity outside the bank, not with government-insured cash.</p> <p>But why did Wall Street actually care about this? Even if the swaps are "pushed out" to a subsidiary outside the FDIC umbrella, they're still part of the bank holding company. If the swaps are profitable, the holding company makes money either way. Ditto if they lose money. So who cares? Via Matt Yglesias, here is John Carney of the <em>Wall Street Journal</em> to explain <a href="http://www.wsj.com/articles/ratings-game-behind-big-banks-derivatives-play-heard-on-the-street-1418417119" target="_blank">why this was so important:</a></p> <blockquote> <p>The advantage: [The bank depository units], with implicit government backing, are considered less risky than parent holding companies....Citigroup&rsquo;s insured depository unit is rated A2 by Moody&rsquo;s; the parent company is a far lower Baa2. So a bank buying a derivative contract from the parent would receive a higher capital charge than if it bought it from the depository unit. So the price Citi could fetch for it would be lower. The same divergence exists at the other banks, though to a lesser degree.</p> <p>The result: Each would suffer from having to push derivatives out of their depository units. In effect, they would lose the advantage of the higher rating and perception of government support.</p> </blockquote> <p>FDIC-insured depository units have higher credit ratings thanks to their government guarantee. Because of this, swaps sold under the depository umbrella also have a higher rating, and can be sold at a higher price. Outside this umbrella, with its lower parent company rating, the price would have to be discounted. That makes the swaps business less profitable.</p> <p><a href="http://www.vox.com/2014/12/15/7392301/swaps-pushout-dodd-frank" target="_blank">As Matt points out,</a> this is an indication that Dodd-Frank is actually doing its job: "Investors aren't confident that Citi is 'too big to fail' and likely to get future bailouts. That's why Citi wants to get as much business as possible done under the shield of the FDIC."</p> <p>I guess, in a way, this is a small bit of solace to take from last week's sordid episode of congressional capitulation to Wall Street: it only mattered because financial reform seems to be working. A little bit, anyway. If it were <em>really</em> working, of course, bank parent companies would be so well capitalized that their credit ratings would be nearly as good as their FDIC-insured subsidiaries. Obviously we're not quite there yet.</p></body></html> Kevin Drum Congress Economy Mon, 15 Dec 2014 16:05:34 +0000 Kevin Drum 266591 at http://www.motherjones.com Krugman: "Russia Keeps Looking More Vulnerable to Crisis" http://www.motherjones.com/kevin-drum/2014/12/krugman-russia-keeps-looking-more-vulnerable-crisis <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Paul Krugman just left a conference in Dubai, and decided to write a bit about oil prices because all the geopolitical stuff he heard was pretty grim. But the oil stuff wasn't that interesting. <a href="http://krugman.blogs.nytimes.com/2014/12/14/petrothoughts/" target="_blank">His one paragraph about geopolitics is:</a></p> <blockquote> <p>My other thought is that Venezuela-with-nukes (Russia) keeps looking more vulnerable to crisis. Long-term interest rates at almost 13 percent, a plunging currency, and a lot of private-sector institutions with large foreign-currency debts. You might imagine that large foreign exchange reserves would allow the government to bail out those in trouble, but the markets evidently don&rsquo;t think so. <strong>This is starting to look very serious.</strong></p> </blockquote> <p>Yes it is, and the reference to Venezuela-with-nukes is telling. A Russian economic crash <em>could</em> just be a crash. That would be bad for Russia, bad for Europe, and bad for the world. But it would hardly be the first <img align="right" alt="" class="image image-_original" src="/files/blog_putin_microphones.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">time a midsize economy crashed. It would be bad but manageable.</p> <p>Except that Russia has Vladimir Putin, Russia has a pretty sizeable and fairly competent military, and Russia has nukes. Putin has spent his entire career building his domestic popularity partly by blaming the West for every setback suffered by the Russian people, and that anti-Western campaign has reached virulent proportions over the past year or two. If the Russian economy does crash, and Putin decides that the best way to ride it out is to demagogue Europe and the West as a way of deflecting popular anger away from his own ruinous policies, it's hard to say what the consequences would be. When Argentina pursues a game plan like that, you end up with a messy court case and lots of diplomatic grandstanding. When Russia does it, things could go a lot further.</p> <p>I have precious little sympathy for Putin, whose success&mdash;such as it is&mdash;is based on a toxic stew of insecurities and quixotic appetites that have expressed themselves in a destructive brand of crude nativism; reactionary bigotry; disdain for the rule of law, both domestic and international; narrow and myopic economic vision; and dependence on an outdated and illiberal oligarchy to retain power. Nonetheless, there are kernels of legitimate grievance buried in many of these impulses, as well as kernels of necessity given both Russia's culture and the post-Cold War collapse of its economy that has left it perilously dependent on extractive industries.</p> <p>I don't know if it's too late to use the kernels as building blocks to improve, if not actually repair, Western relations with Putin's Russia. But it's still worth trying. A Russian crash may or may not come, but it's hardly out of the realm of possibility. And if it happens, even a modest rapprochement between East and West could help avoid a disastrous outcome.</p></body></html> Kevin Drum Economy Foreign Policy International Sun, 14 Dec 2014 16:31:26 +0000 Kevin Drum 266556 at http://www.motherjones.com Ted Cruz Shoots Self in Foot, Declares Victory http://www.motherjones.com/kevin-drum/2014/12/ted-cruz-shoots-self-foot-declares-victory <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>File this under <a href="http://www.latimes.com/nation/politics/politicsnow/la-pn-senate-ted-cruz-saturday-session-government-shutdown-20141213-story.html" target="_blank">"with friends like this, who needs enemies?"</a></p> <blockquote> <p>Republican senators fumed as a strategy developed by Sen. Ted Cruz (R-Texas) intended to undercut President Obama&rsquo;s immigration action seemed to backfire, giving Democrats a chance to move a <img align="right" alt="" class="image image-_original" src="/files/blog_cruz_reporters.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">batch of controversial Obama administration appointments.</p> <p>....Saturday&rsquo;s session was required after conservative Sen. Mike Lee (R-Utah) objected to an effort by Senate Majority Leader Harry Reid (D-Nev.) late Friday to adjourn the Senate for the weekend....He and Cruz had sought to force a vote to strip out funding that would be used to implement Obama&rsquo;s plan to halt deportations for as many as 5 million immigrants.</p> <p><strong>Without the ability to leave for the weekend, Reid instead began the process of bringing 20 long-stalled nominations to a vote, </strong>including Obama&rsquo;s nominee for surgeon general, Vivek Murthy, who was a target of groups like the powerful National Rifle Assn. over his advocacy for stricter gun laws. Shortly after noon the Senate began the first of what could be 40 procedural votes that could lead to confirming all the nominees by the end of the week.</p> </blockquote> <p>The Cruz/Lee proposal was entirely symbolic in not just one, but two separate ways:</p> <ul><li>It was merely a "point of order" to express opposition to funding President Obama's executive order on immigration. It would have accomplished nothing.</li> <li>It had little chance of passing anyway.</li> </ul><p>So now everyone has to spin their wheels on the Senate floor over the weekend instead of seeing their families or watching the Army-Navy game. By itself, that might deserve only the world's tiniest violin. But as long as they're there and have some extra time, Harry Reid decided to start the process of approving a whole bunch of Obama nominations that otherwise might have dropped off the calendar later in the week as senators began pressing to start the holiday recess. That meant Obama's nominees would have had to face a Republican Senate in January, but now, thanks to Cruz and Lee, they'll all be safely in office by then.</p> <p>I'm sure the NRA is thrilled. Ditto for all the Republicans who were apoplectic over the nomination of Tony Blinken as deputy secretary of state. And megadittoes&mdash;with a megadose of irony&mdash;for Cruz, Lee, and all their tea party buddies who objected to confirming Sarah&nbsp;Salda&ntilde;a to head Immigration and Customs Enforcement. Their objection, of course, was meant as a protest against Obama's executive order on immigration. Now, thanks to a dumb little stunt that was pathetic even as an empty protest against Obama's immigration plan, they're going to lose an actual, substantive protest against an Obama immigration nominee. Nice work, guys.</p> <p>But I guess it's a nice big platter of red meat that plays well with the rubes. With Cruz, that's all that counts.</p> <p><strong>UPDATE:</strong> <a href="http://www.nytimes.com/2014/12/14/us/senate-spending-package.html" target="_blank">You gotta love this:</a></p> <blockquote> <p>Only the Democrats seemed able to wrest a modicum of enjoyment from the day&rsquo;s proceedings. Senator Benjamin L. Cardin, Democrat of Maryland, said that it was &ldquo;inconvenient to be here voting around the clock&rdquo; but that he was &ldquo;kind of pleased at how it&rsquo;s working out.&rdquo; Mr. Cardin said, &ldquo;We will get these confirmations done, and we may not have gotten them done otherwise.&rdquo; And as Senator John Cornyn of Texas, the No. 2 Senate Republican, struggled to explain to a group of reporters just what Mr. Cruz was trying to achieve, Senator Cory Booker, Democrat of New Jersey, loped by and clapped him on the shoulder.</p> <p>&ldquo;Let me know if you need backup,&rdquo; Mr. Booker said with a grin.</p> </blockquote></body></html> Kevin Drum Congress Immigration The Right Sun, 14 Dec 2014 01:29:34 +0000 Kevin Drum 266551 at http://www.motherjones.com James Risen Will Not Be Required to Reveal His Sources for "State of War" http://www.motherjones.com/kevin-drum/2014/12/james-risen-will-not-be-required-reveal-his-sources-state-war <!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.nytimes.com/2014/12/13/us/eric-holder-preet-bharara-richard-bonin-subpoena-testify-in-terrorism-trial.html" target="_blank">From the <em>New York Times</em>:</a></p> <blockquote> <p>[Preet Bharara, the United States attorney in Manhattan] wants to force Richard Bonin, a longtime producer for &ldquo;60 Minutes,&rdquo; to testify next month at a terrorism trial over bombings by Al Qaeda in 1998. <strong>One of the two defendants, Khaled al-Fawwaz, is accused of running Al Qaeda&rsquo;s media office in London.</strong> Prosecutors want Mr. Bonin to discuss his dealings with the group&rsquo;s media office in an unsuccessful effort to interview Osama bin Laden in 1998, officials and others briefed on the case said.</p> </blockquote> <p>Wait. What? Al Qaeda had a media office?</p> <p>In other, better news, Eric Holder has decided <a href="http://www.nbcnews.com/news/us-news/attorney-general-wont-force-new-york-times-reporter-reveal-source-n267481" target="_blank">not to subpoena <em>New York Times</em> reporter James Risen</a> in an effort to force him to reveal the sources for his book, <em>State of War</em>. "If the government subpoenas Risen to require any of his testimony," a Justice Department official said, "it would be to confirm that he had an agreement with a confidential source, and that he did write the book." I don't know how Risen feels about that, but it's obviously much less pernicious than threatening jail time for refusing to identify a source.</p> <p><a href="http://www.outsidethebeltway.com/justice-department-wont-force-one-reporter-to-testify-faces-a-choice-on-another/" target="_blank">This comes via Doug Mataconis,</a> who argues persuasively that the arbitrary nature of federal prosecutions against reporters for refusing to reveal a source is exactly why we need to pass some kind of federal shield law for reporters. Even if it turned out to be weaker than many of us would like&mdash;pretty much a dead certainty, I'd say&mdash;at the very least it would provide some consistent guidance for both judges and media members.</p></body></html> Kevin Drum Civil Liberties Crime and Justice Media Sat, 13 Dec 2014 19:35:08 +0000 Kevin Drum 266546 at http://www.motherjones.com Disneyland Is the Latest Victim of Thin-Skinned 1-Percenters http://www.motherjones.com/kevin-drum/2014/12/disneyland-latest-victim-thin-skinned-1-percenters <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>If you don't live in Southern California&mdash;or if you do, but have a life&mdash;you might not be aware of Club 33, a "secret" club at Disneyland coveted by the rich and famous as a hideway from the hoi polloi at the park. (And, not coincidentally, the only place at Disneyland that serves alcoholic beverages.) It's so coveted, in fact, that there's no waiting list for membership. Years ago, it got so long that Disneyland just closed it.</p> <p>Today, the <em>LA Times</em> passes along breaking news that has outraged the 1% who are the <a href="http://www.latimes.com/business/la-fi-disney-club-33-20141213-story.html" target="_blank">primary (only?) denizens of the place:</a></p> <blockquote> <p>For access to what is billed as "the most exclusive address in all of Disneyland" &mdash; Club 33 &mdash; many members pay $11,000 a year....The current uproar has to do with how many extra VIP cards are allotted to platinum members.</p> <p>The cards allow a lucky few to enjoy many of the benefits of a member, including access to Disney parks and dining at the secretive Club 33 restaurant, tucked away in Disneyland's New Orleans Square....But last week, platinum members received a letter that said <strong>in 2015 only the member and a spouse or domestic partner would have Club 33 benefits</strong>, while the price for the platinum level would rise to $12,000....A <img align="right" alt="" class="image image-_original" src="/files/blog_club_33.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">current platinum VIP cardholder was enraged. "It really has just turned to a money game for them."</p> </blockquote> <p>OMG! "It really has just turned to a money game for them." This is mighty rich coming from someone who is almost certainly wealthy as hell and probably considers himself a rock-jawed supporter of laissez-faire capitalism. But if Disneyland raises the price and changes the terms of a product that obviously has far more demand than supply, why, it's just an example of a bunch of ruthless money-grubbers taking advantage of the downtrodden. How dare they?</p> <p>Plus he's dead wrong anyway. First of all, last I looked Disney was a public corporation widely admired in the business world for its money-making prowess. Of course it's a money game for them. Second, the waiting list for Club 33 is <em>so long that it's closed</em>. Quite plainly, they could double or triple the price of a platinum card and keep their membership at the same level. In other words, if they really were just ruthless money-grubbers, they could instantly double or triple their revenues for Club 33 with the stroke of a pen. The fact that they haven't done this clearly suggests some combination of loyalty to longtime members along with an understandable desire to avoid a PR headache.</p> <p>Anyway, that's Orange County for you. Home of conservative Republicans who have an abiding faith in the free market when they're the ones setting the rules, but get in a snit when they themselves end up on the business end of the not-so-invisible hand. You can file this under the shockingly thin skins of the rich when they aren't treated with the fawning deference they all think is their birthright.</p> <p><strong>UPDATE:</strong> Here's a note for aficionados of behavioral economics. As near as I can tell, the outrage here is not over the modest 9 percent price increase. It's over the loss of a perk. This is an example of people responding far more strongly to loss than to gain. And in this case it's especially irksome because it's the loss of a perk that allows a member to very publicly show off their status. <em>"Going to Disneyland? Here, why don't you take one of my VIP cards and eat at Club 33. It's great."</em> This is a chance to do a favor for someone <em>and</em> show off your ownership of a normally invisible status symbol that money can't buy. But now it's gone.</p></body></html> Kevin Drum Income Inequality Sat, 13 Dec 2014 16:44:33 +0000 Kevin Drum 266541 at http://www.motherjones.com Friday Cat Blogging - 12 December 2014 http://www.motherjones.com/kevin-drum/2014/12/friday-cat-blogging-12-december-2014 <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Last week, Hilbert got catblogging all to himself. This week it's Hopper's turn. Marian took this picture of Hopper gazing out the kitchen window with the bird bath in the background&mdash;and that's no coincidence. The bird bath and the hummingbird feeders are objects of endless fascination.</p> <p>In other news, I have a follow-up from last week. Now that he's taken its measure, it turns out that Hilbert can jump onto the fireplace mantle with ease. No furious runup necessary. However, it also turns out that having taken its measure, he's now bored with it. There's no challenge left, I guess. So the mantle is safe once again. Maybe. Until he gets bored. Welcome to kittenland.</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_hopper_2014_12_12.jpg" style="border: 1px solid black; margin: 15px 0px 5px 60px;"></p></body></html> Kevin Drum Fri, 12 Dec 2014 19:55:08 +0000 Kevin Drum 266516 at http://www.motherjones.com Thanks to New Media, We All Have Box Seats at the Sausage Factory http://www.motherjones.com/kevin-drum/2014/12/thanks-new-media-we-all-have-box-seats-sausage-factory <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Brian Beutler writes today about the <a href="http://www.newrepublic.com/article/120545/elizabeth-warren-vs-barack-obama-cromnibus-vote-exposes-faultlines" target="_blank">enormous amount of attention we've paid to the cromnibus spending bill this week:</a></p> <blockquote> <p>Until the country came to be governed by serial brinksmanship, the writing and passage of annual spending bills weren&rsquo;t huge stories in American politics, and you had to be unusually attuned to both the content and the process to understand the political currents underlying both. When problems arose, there was always the palliative of earmarks to smooth things over.</p> <p>But the narrow passage Thursday night of a big spending bill in the House of Representatives brought everything to the surface, even <img align="right" alt="" class="image image-_original" src="/files/blog_sausage.jpg" style="border: 1px solid black; margin: 20px 0px 15px 30px;">though the risk of a government shutdown was near zero.</p> </blockquote> <p>I think that's only part of the story. It's true that as recently as a decade ago, spending bills didn't have a big audience. Genuine insiders&mdash;aides, lobbyists, single-issue activists&mdash;paid attention to the minutiae, but most of us didn't. More to the point, most of us <em>couldn't</em>. Even if you were the kind of person who read TNR and <em>National Review</em> and <em>Roll Call</em> religiously, you just weren't going to be exposed to that much coverage.</p> <p>This wasn't because budgets were more boring back then. Or because the political shenanigans were less egregious. It's because print publications didn't devote very much space to them. You'd get the basics, but that was it. And given the limitations of print production schedules, the drama of watching deals rise and fall on a daily or hourly basis simply wasn't possible in real time.</p> <p>But the often maligned rise of blogs and Twitter, along with their new media offshoots, has created a whole new world. Over at Vox, for example, they ran nine pieces about the spending bill <em>just yesterday</em>. If you follow the right people, Twitter will keep you literally up to minute on even the smallest issues. Dozens of blogs will explain the policy implications of obscure provisions. <em>Politico</em> will flood the zone with pieces about conflicts and personalities as the fight unfolds.</p> <p>By normal standards, the spending bill the House passed yesterday was fairly routine. But digital media turned it into <em>High Noon</em> and we all played along. We pretended that this was something uniquely shameless, when it wasn't. The sausage has always been made this way. The only difference is that now we all have box seats on the factory floor.</p></body></html> Kevin Drum Congress Media Fri, 12 Dec 2014 19:25:59 +0000 Kevin Drum 266511 at http://www.motherjones.com Chart of the Day: The World Has More Oil Than It Needs http://www.motherjones.com/kevin-drum/2014/12/chart-day-world-has-more-oil-it-needs <!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_oil_supply_demand.jpg" style="border: 1px solid black; margin: 8px 0px 15px 30px;">I don't have a lot to say about this, but I wanted to pass along <a href="http://www.washingtonpost.com/blogs/wonkblog/wp/2014/12/12/the-basic-reason-oil-keeps-getting-cheaper-and-cheaper/" target="_blank">this chart from Chris Mooney over at Wonkblog.</a> Basically, it shows that although both supply and demand for oil have been roughly in sync for the past five years, demand abruptly dropped earlier this year and is projected to stay low next year. This is why prices have dropped so far: not because supply has skyrocketed thanks to fracking&mdash;the supply trendline is actually fairly smooth&mdash;but because the world is using less oil.</p> <p>This is a short-term blip, and I don't want to make too much of it. Still, regular readers will remember that one of the biggest problems with oil isn't high prices per se. The world can actually get along OK with high oil prices. The problem is <em>spikes</em> in oil prices <a href="http://www.motherjones.com/kevin-drum/2011/08/wee-bit-more-oil-and-economy" target="_blank">caused by sudden imbalances between supply and demand.</a> Historically this wasn't a big problem because potential supply was much higher than demand. If demand went up, the Saudis and others just opened up the taps a bit and everything was back in balance.</p> <p>But that hasn't been true for a while. There's very little excess capacity these days, so if oil supply drops due to war or natural disaster, it can result in a very sudden spike in prices. And <em>that</em> can lead to economic chaos. But if demand has fallen significantly below supply, it means we now have excess capacity again. And if we have excess capacity, it means that the price of oil can be managed. It will still go up and down, but it's less likely to unexpectedly spike upward. And this in turn means that, at least in the near future, oil is unlikely to derail the economic recovery. It's a small but meaningful piece of good news.</p></body></html> Kevin Drum Energy Fri, 12 Dec 2014 17:28:37 +0000 Kevin Drum 266496 at http://www.motherjones.com Here's What Democrats Got Out of the Cromnibus http://www.motherjones.com/kevin-drum/2014/12/heres-what-democrats-got-out-cromnibus <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>The worst part of the "cromnibus" spending bill was the provision that guts a small piece of the Dodd-Frank financial reform bill and allows banks to get back into the custom swaps business. So why did Democratic negotiators agree to this? In a long tick-tock published yesterday, <a href="http://www.politico.com/story/2014/12/wall-street-spending-bill-congress-113525.html?hp=t1_r" target="_blank"><em>Politico</em> tells us:</a></p> <blockquote> <p>During [] negotiations with House Appropriations Chairman Hal Rogers (R-Ky.), Barbara Mikulski (D-Md.), his Senate counterpart, <strong>agreed to keep the provision in exchange for more funding for the Commodity Futures Trading Commission</strong> and the Securities and Exchange Commission, according to aides.</p> </blockquote> <p>OK. Democrats have been ambivalent about this particular provision of Dodd-Frank from the start, and therefore they were willing to cut a deal that allowed Republicans to repeal it. But what about the rest of the spending bill?<iframe align="right" allowfullscreen="" frameborder="0" height="258" src="http://www.youtube.com/embed/5P-gDET6Bws" style="margin: 20px 20px 15px 30px;" width="400"></iframe> Republicans got a bunch of venal little favors inserted, but what did Democrats get? <a href="https://www.youtube.com/watch?v=5P-gDET6Bws" target="_blank">Here's retiring Rep. Jim Moran:</a></p> <blockquote> <p><strong>In 20 years of being on the appropriations bill, I haven&rsquo;t seen a better compromise in terms of Democratic priorities.</strong> Implementing the Affordable Care Act, there&rsquo;s a lot more money for early-childhood development &mdash; the only priority that got cut was the EPA but we gave them more money than the administration asked for....There were 26 riders that were extreme and would have devastated the Environmental Protection Agency in terms of the Clean Water and Clean Air Act administration; all of those were dropped. There were only two that were kept and they wouldn&rsquo;t have been implemented this fiscal year. <strong>So, we got virtually everything that the Democrats tried to get.</strong></p> </blockquote> <p><a href="http://blogs.rollcall.com/white-house/obama-backs-cromnibus/" target="_blank">And here is President Obama:</a></p> <blockquote> <p>The Administration appreciates the bipartisan effort to include full-year appropriations legislation for most Government functions that allows for planning and provides certainty, while making progress toward appropriately investing in economic growth and opportunity, and adequately funding <strong>national security requirements.</strong> The Administration also appreciates the authorities and funding provided to enhance the U.S. Government&rsquo;s response to the <strong>Ebola epidemic,</strong> and to implement the Administration&rsquo;s strategy to <strong>counter the Islamic State of Iraq and the Levant,</strong> as well as investments for the President&rsquo;s <strong>early education agenda, Pell Grants, the bipartisan Manufacturing Institutes initiative, and extension of the Trade Adjustment Assistance program.</strong></p> </blockquote> <p>What's the point of posting this laundry list? Curiosity. Last night a reader sent a tweet to me: "Honest question: what do progressives get out of this? 'Govt not shutting down' not enough." I was stumped. I really had no idea whether Democrats had gotten anything in this bill, or if they were just caving in to a whole bunch of obnoxious Republican demands merely in exchange for keeping the government funded.</p> <p>But as it turns out, Democrats <em>did</em> get a bunch of stuff they wanted. And of course, that's in addition to getting the government funded before Republicans take over Congress in January, <a href="http://www.washingtonpost.com/blogs/plum-line/wp/2014/12/12/morning-plum-the-good-and-the-bad-in-the-big-budget-deal/" target="_blank">which is worthwhile all by itself.</a> We can each decide for ourselves whether Democrats got enough, or if they should have held out for a better deal, but they weren't left empty-handed.</p> <p>So what I'm curious about is this: why are virtually no Democrats talking about this? As near as I can tell, there was literally no attempt to sell this compromise to the base, or to anyone else. As a result, the general feeling among progressives is simple: this bill was an unqualified cave-in from gutless Democrats who, once again, refused to fight back against Republican hostage taking. And as usual, Republicans won.</p> <p>I understand that trying to defend a messy, backroom bill that trades some dull but responsible victories for a bunch of horrible little giveaways isn't very appealing to anyone. And who knows? Maybe Democrats were afraid that if they crowed too much about the concessions they'd won it would just provoke the tea party wing of the Republican party and scuttle the bill. The tea partiers were <a href="http://www.redstate.com/2014/12/11/this-is-not-complicated/" target="_blank">already plenty pissed off about the cromnibus,</a> after all.</p> <p>Still, shouldn't someone have been in charge of quietly making the progressive case for this bill? It wouldn't have convinced everyone, but it might have reduced the grumbling within the base a little bit. Why was that not worth doing?</p></body></html> Kevin Drum Congress Fri, 12 Dec 2014 15:30:20 +0000 Kevin Drum 266486 at http://www.motherjones.com Torture Is Not a Hard Concept http://www.motherjones.com/kevin-drum/2014/12/torture-isnt-hard-concept <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Like all of us, I've had to spend the past several days listening to a procession of stony-faced men&mdash;some of them defiant, others obviously nervous&mdash;grimly trying to defend the indefensible, and I'm not sure how much more I can take. How hard is this, after all? Following 9/11, we created an extensive and cold-blooded program designed to inflict severe pain on prisoners in <img align="right" alt="" class="image image-_original" src="/files/blog_torture_2.jpg" style="border: 1px solid black; margin: 25px 0px 15px 30px;">order to break them and get them to talk. That's torture. It always has been, and even a ten-year-old recognizes that legalistic rationalizations about enemy combatants, "serious" physical injury, and organ failure are transparent sophistry. <em>Of course</em> we inflicted severe pain. Moderate pain would hardly induce anyone to talk, would it? And taking care not to leave permanent marks doesn't mean it's not torture, it just means you're trying to make sure you don't get caught.</p> <p>Christ almighty. Either you think that state-sanctioned torture of prisoners is beyond the pale for a civilized country or you don't. No cavils. No resorts to textual parsing. And no exceptions for "we were scared." This isn't a gray area. You can choose to stand with history's torturers or you can choose to stand with human decency. Pick a side.</p></body></html> Kevin Drum Human Rights Fri, 12 Dec 2014 04:06:26 +0000 Kevin Drum 266471 at http://www.motherjones.com Here's the Ugly Side of Bipartisanship http://www.motherjones.com/kevin-drum/2014/12/heres-ugly-side-bipartisanship <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd"> <html><body><p>Dylan Matthews, after running down all the obnoxious amendments to the omnibus spending bill currently wending its way through Congress, wonders aloud if it's <a href="http://www.vox.com/2014/12/11/7377253/cromnibus-veto" target="_blank">still worth supporting:</a></p> <blockquote> <p>If you're Barack Obama, or a liberal Democrat generally, most of these riders are setbacks, in some cases significant ones. Indeed, Obama's condemned the Dodd-Frank and campaign finance provisions. He could, in theory, reject the deal and demand that Congress send him a bill without changes to Dodd-Frank, or one that doesn't meddle in DC's affairs, etc. <img align="right" alt="" class="image image-_original" src="/files/blog_bipartisanship.jpg" style="margin: 20px 0px 15px 30px;">And yet he has come out in favor of House passage of the bill.</p> <p>Is he making a massive mistake?</p> </blockquote> <p>This is one of those things that demonstrates the chasm between political activists and analysts on the one side, and working politicians on the other. If you take a look at the bill, it does indeed have a bunch of objectionable features. People like me, with nothing really at stake, can bitch and moan about them endlessly. But you know what? For all the interminable whining we do about the death of bipartisanship in Washington, <em>this is what bipartisanship looks like.</em> It always has. It's messy, it's ugly, and it's petty. Little favors get inserted into bills to win votes. Other favors get inserted as payback for the initial favors. Special interests get stroked. Party whips get a workout.</p> <p>That's politics. The fact that it's happening right now is, in a weird sense, actually good news. It means that, for a few days at least, politics is working normally again.</p> <p>I understand that this sounds very Slatepitchy. But it's true. Even at its best, politics is lubricated by venality, ego, and mutual backscratching. And you know what? By the normal standards of this kind of stuff, the obnoxious riders in the current spending bill are pretty mild. Really. The only one that rises above the level of a political misdemeanor is the provision that allows banks to get back into the custom swaps business, and even that's hardly the end of the world. Swaps may have provided a tailwind to the 2008 financial collapse, but they were far from its core cause.</p> <p>So should working politicians avert their gaze from the muck and vote to keep the government functioning? Of course they should. Government shutdowns are immensely costly in their own right, after all. This kind of crass calculus sucks, but that's human nature for you. All things considered, I'd say we all got off fairly easy this time around.</p></body></html> Kevin Drum Congress Thu, 11 Dec 2014 19:36:34 +0000 Kevin Drum 266431 at http://www.motherjones.com