Kevin Drum

Conventional Wisdom Watch

| Sat Feb. 7, 2009 11:42 PM EST | Scheduled to publish Thu Feb. 5, 2009 11:52 AM EST

CONVENTIONAL WISDOM WATCH....Wednesday's CW: The stimulus bill is doomed! We're all gonna die!

Thursday's CW: It'll pass by Friday, with a few modest changes. Happy days!

You could get whiplash from stuff like this. Hopefully today's CW is the right one.

Advertise on


| Thu Feb. 5, 2009 9:21 PM EST | Scheduled to publish Thu Feb. 5, 2009 2:20 AM EST
HONEYBEES!....I'm back! Not really at a hundred percent or anything, but in good enough shape for blogging. And I have to say that my timing was pretty good: all I really missed was a fantastic amount of teeth gnashing (tooth gnashing?) over Barack Obama supposedly losing control of the stimulus bill. And I admit that my teeth were gnashing too for a while. But I have to say that with the benefit of thinking about this for a few hours rather than a few minutes, it's pretty obvious that people are overreacting. Yes, Republicans are acting like Republicans, and sure, Obama is going to end up making some compromises. But that's what he said he was willing to do all along. So really, what's the big deal? It's going to work out OK within the next few days, and I'll bet the Senate ends up adding about as much stuff as it takes out. So chill. But speaking of Republicans acting like Republicans, Michael Hiltzik has dredged up a good one. Apparently Neil Cavuto has been carrying on for the past week about an item in the stimulus bill he calls "honeybee insurance," and Mitch McConnell and David Vitter have joined in on the Senate floor to mock this disgraceful waste of taxpayer money. It's shocking! Now, you will be unsurprised to learn that the program in question isn't honeybee insurance at all, it's disaster insurance for all livestock producers. But that's not the best part. This is:

The provision simply continues a program enacted by Congress last year, overriding a veto by President Bush. In other words, the Senate voted on it twice in 2008 — once to enact and once to override. Connoisseurs of political comedy will see the punch line coming: McConnell and Vitter voted yea both times. So it turns out that McConnell isn't really against honeybees. He's only using them to pretend that he's got a principled objection to a stimulus plan aimed at pulling the country out of the most severe recession in decades.

Ladies and gentlemen, your Republican Party. Country first, as always.


| Tue Feb. 3, 2009 9:06 PM EST

COMMENTS....Quick note from my deathbed1: We will be making the big switch to our new website this weekend. The migration of content from the old site to the new has already started, however, which means that any comments left between now and Friday will disappear when the new site goes live.

I repeat: Any comments left between now and Friday will disappear when the new site goes live. So if you post anything Pulitzer worthy for the next few days, be sure to keep a copy locally. You have been warned.

1Just kidding.

Off Today

| Tue Feb. 3, 2009 12:02 PM EST

OFF TODAY....I'm sick as a dog today, and there's no telling what kind of gibberish I might spout if I tried to blog. So I'm taking the day off. See you tomorrow, I hope.

For my fellow inmates here in The OC, however, I commend to you this story in Sunday's Register. The nice map they ran in the print edition showing that Orange County is now almost entirely blue and purple among young voters isn't online, but the story itself is almost as good.


| Mon Feb. 2, 2009 7:22 PM EST

RECONCILIATION....Elana Schor reports that Mitch McConnell is being cagey about whether Senate Republicans will filibuster the stimulus bill. Cue McConnell:

Our goal is to produce a bill that makes a difference; not to kill the measure. So the goal is entirely different from what your question seems to suggest. The goal is to make it better. And we go into this with an open mind. We have two, I think, really good ideas that are entirely in line with what the president I think wants to do.

Actually, I believe him. If Republicans really did put up a united front and filibuster the legislation, the Democratic leadership would just turn around and consider the bill under budget reconciliation rules, which require only a majority vote to pass. Sure, they've already said they'd prefer not to do that, but if they have to they will. And since the bill is all about short-term spending, it would obviously qualify under reconciliation rules.

So all the public handwringing seems like standard DC negotiating kabuki to me, not a genuine effort to kill the bill. If Republicans filibuster, the public will view them as bitter obstructionists and the bill will pass anyway. It's hard to see what's in it for them to go down this road.

POSTSCRIPT: Though if they did lose their minds and filibuster, it would be a great opportunity for Harry Reid to bring back the old filibuster rules and make 'em talk. I know that's just a leftosphere wet dream, but still. It would be great. Hell, how about if we just use this as an excuse to haul out the nuclear option and get rid of the filibuster completely? That would totally rock.

Buy American

| Mon Feb. 2, 2009 2:56 PM EST

BUY AMERICAN....Are we on the brink of a trade war? Or, if not a war, perhaps a trade squabble:

"You're going to see a lot more rhetoric out of leaders against protectionism, but what really matters is their policies," said Simon Johnson, former chief economist at the International Monetary Fund and a professor of economics at MIT....The European Commission is reinstating subsidies on some dairy products to protect its farmers, targeting an area of trade law that remains highly contentious, open to interpretation and potentially damaging to developing countries. Analysts are also bracing for nations to make excessive use of the legal tools now available to them to fight unfair trade, such as filing anti-dumping cases before the WTO.

....In the United States, a move to greatly expand Buy American provisions as part of the $819 billion fiscal stimulus package has generated shock waves in other countries, with Canadian and European officials in particular rising up in protest. The provision, passed by the House on Wednesday, would mostly bar foreign steel and iron from the infrastructure projects laid out in the stimulus package. A Senate version still being considered goes further, requiring, with few exceptions, that all stimulus-funded projects use only American-made equipment and goods.

I have to confess that when I first heard of the Buy American provisions in the trade bill, my first thought was, "Well, what do you expect?" Politically, if you're going to ask American taxpayers to pony up $800 billion to rescue the economy, then of course they're going to want this money spend on American goods and services. And given the behavior of the Republican Party so far, if this provision were removed I think it's safe to say that they'd scream blue murder at election time over every ton of Korean steel that ended up in an American bridge or sewer pipe. Their dedication to free trade, after all, has been pretty cynical over the past eight years.

But still, I guess I was a little too jaded about the whole thing. It may be a political problem, but jettisoning the Buy American language would be the right thing to do. A little bit of restraint on our part could buy us a lot of goodwill down the road and prevent a cascading series of similar measures from other countries. It's worth being a grownup on this issue.

Advertise on

Quote of the Day - 02.02.09

| Mon Feb. 2, 2009 1:38 PM EST

QUOTE OF THE DAY....From Newt Gingrich, apparently warming up to Sarah Palin:

"If Sarah Palin seeks out a group of very sophisticated policy advisers and develops a fairly sophisticated platform, she will be very formidable."

Golly, I wonder just which "very sophisticated policy advisers" Newt has in mind?

Another Commission?

| Mon Feb. 2, 2009 1:33 PM EST

ANOTHER COMMISSION?....Lori Montgomery reports on a proposal for putting our country's financial house in order after the stimulus bill is passed:

At the moment, discussions are focused on whether to name a special panel to make the difficult decisions that would be required to right the nation's finances....The task force would wrestle with the details of Social Security, Medicaid, Medicare and the tax code, and deliver a reform plan to Congress for a vote later this year.

Under the proposal, the task force's recommendations could not be amended; the House and Senate would be required to accept or reject them without changes or additions, similar to the process lawmakers use to close military bases.

...."Some people have said we don't need a commission. But you know and I know it's never going to happen" without one, said Sen. George V. Voinovich (R-Ohio), a longtime champion of overhauling the budget who is still smarting from Bush's failure to push comprehensive tax reform.

Obama supports the idea (though apparently Nancy Pelosi doesn't), and blue ribbon commissions are a long-time staple of Washington politics. So sure, something like this will probably happen. But does anyone really think that Congress will agree to a straight up-or-down vote on the recommendations with no chance to amend them? Never say never, but that sounds pretty unlikely to me.

Off Label

| Mon Feb. 2, 2009 12:49 PM EST

OFF LABEL....As the sun was setting on the final days of the Bush administration, they left us with one final gift: a new rule that made it easier for drug manufacturers to promote "off-label" prescription drug uses. The pharmaceutical industry loves this, of course, and they spend millions of dollars promoting their latest narrowly targeted wonder drugs to a wider audience while pretending they're doing no such thing. Blue Girl explains:

The problem is, the system has become corrupted and drug companies do their own "research," get it published, and then promote the off-label uses that their "research" showed was effective. A really common one is to prescribe antidepressants for pain management. I refused to take Cymbalta along with my anti-inflammatory and pain management meds because I can not see where changing my neurochemistry would have any effect on my degraded and damaged knees. He got pissy when I questioned the wisdom of the drug makers — and I got a new doctor. Within the first five minutes of meeting him, I told him to make sure to put on my chart in big letters that I refuse off-label uses, and in fact, given that my only health problems are annoyances more than illnesses, I prefer to stick with drugs that have been around long enough to have generics available. When he found out I did some of the peer review on Rezulin, Vioxx and Baycol, he realized exactly where I was coming from.

In BG's case, using Cymbalta would have been an annoyance, not a life threatener. But that's not always the case, and the drug companies themselves certainly aren't the ones who should be making that call. "A legislative fix may be in order," says Chuck Grassley. More here.

Amex Redux

| Mon Feb. 2, 2009 12:30 PM EST

AMEX REDUX....On Saturday I vented about American Express's habit of examining which shops you buy stuff at and then reducing your credit limit if they don't like what they see. Megan McArdle thinks I'm being unrealistic:

This is what credit management looks like: you try to shut off access to the poor. Poor people have less financial cushion than wealthier people, and they are therefore much more likely to default on their debt.

....You can't have it both ways. Either you want credit card companies and mortgage originators to do everything they can to keep credit risks out of their system — which means identifying people whose shopping patterns indicate financial trouble — or you want them to extend too much credit. The sad fact is that becoming a more responsible lender is largely synonymous with discriminating against the poor.

Saturday's post was a vent, motivated more by the fact that I hate credit card companies than anything else, so let me take a moment to explain my real issue with what Amex is doing. Here's the problem: I'm a privacy dinosaur who doesn't like the idea of corporate America having access to my shopping history. What I buy, and where I buy it, are my business and no one else's unless they have probable cause and a subpoena to make me cough it up.

Now, obviously I'm on the wrong side of history here, but I continue to think that Fortune 500 marketing departments having routine access to my shopping habits is a far more corrosive practice than most people acknowledge. In the case of supermarkets and their loyalty card tracking programs, though, at least I have a choice. It's not much of a choice for most people, since the only way to opt out is to increase your grocery bill considerably, but you can still do it. In the case of your credit card company, you can't. They occupy an extremely privileged place in the financial system that automatically gives them access to your shopping history.

Normally, when financial intermediaries have access to sensitive information like this, regulations on what they can and can't do with it are pretty strict. They should be here too. I don't have any real problem, for example, with generic transaction shaping being used for fraud detection. That's not punitive in any way and doesn't rely on knowledge of specific purchases. Credit limit decreases are another story, especially since they can trigger a surprisingly vast waterfall of dire consequences for people (thanks to some of the other indefensible practices of the credit card industry). So in the same way that auto insurance companies in California aren't allowed to use redlining to set rates even though it probably "works," I don't think credit card companies should be allowed to mine your private shopping history to decide whether or not to cut you off from your credit supply. They're taking unfair advantage of their inherent access to private information, and whether they like it or not, they shouldn't be allowed to use this information themselves any more than they should be allowed to sell it to telemarketers or direct sales companies.

I'll add two more things to this. First, shed no tears for the card issuers. They have plenty of other ways of tracking your creditworthiness. Taking this one away won't hurt them much. Second, it's pretty obvious that Amex understands they went too far, since (or so they say) they ended this program when people started asking questions about on Good Morning America and the New York Times. But I'd feel a lot better if, instead of relying on their PR horse sense, we had some federal regulation to make sure this program — and lot of other credit card practices much worse than this — were dead and buried for good.