Kevin Drum

FCC Chairman Finally Gets Fully Behind Net Neutrality

| Wed Feb. 4, 2015 12:32 PM EST

FCC chairman Tom Wheeler is now officially on board supporting the strongest possible version of net neutrality. Here's his first-person statement:

Originally, I believed that the FCC could assure internet openness through a determination of “commercial reasonableness” under Section 706 of the Telecommunications Act of 1996. While a recent court decision seemed to draw a roadmap for using this approach, I became concerned that this relatively new concept might, down the road, be interpreted to mean what is reasonable for commercial interests, not consumers.

That is why I am proposing that the FCC use its Title II authority to implement and enforce open internet protections.

Using this authority, I am submitting to my colleagues the strongest open internet protections ever proposed by the FCC. These enforceable, bright-line rules will ban paid prioritization, and the blocking and throttling of lawful content and services. I propose to fully apply—for the first time ever—those bright-line rules to mobile broadband. My proposal assures the rights of internet users to go where they want, when they want, and the rights of innovators to introduce new products without asking anyone’s permission.

Title II is the law that currently regulates telephone networks as common carriers. Applying this to broadband internet gives the FCC extremely strong powers to guarantee free and equal internet access to everyone, just as they currently do for telcos.

The argument against doing this is that Title II has a lot of baggage designed specifically for telcos—baggage that makes sense for telephones but not for internet connections. Wheeler recognizes this, and says that he plans to "modernize" Title II. Under his proposal, for example, "there will be no rate regulation, no tariffs, no last-mile unbundling."

This is a huge win for net neutrality advocates. Nonetheless, it would be a bigger win if it spurred Republicans to take seriously a compromise bill that regulates broadband legislatively. Title II may be a big stick, but it's not necessarily a permanent one. Aside from the fact that it's open to court challenges, it could also be eliminated by a future FCC just as easily as it gets created by today's FCC. If a Republican becomes president in 2016 and appoints a majority Republican FCC, Wheeler's proposal could get tossed out with a simple vote of the five commissioners.

Either way, though, this is a welcome move. Either we get a modernized Title II, or else Wheeler's proposal lights a fire under Sen. John Thune that produces a compromise solution from Congress. So far Democrats haven't been especially open to working with Thune, but I hope they change their minds. Maybe negotiations would go nowhere. If so, nothing is lost and Title II becomes the law of the land. But there's always the chance that with Title II as a backstop, negotiations could produce something genuinely useful. As with all compromises, net neutrality advocates would almost certainly lose some things they value. Republicans wouldn't get everything they want either. But both sides—as well as the broadband industry itself—would gain permanence, and that's worth something.

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Here's the Big Problem With Liberals' "Middle Class" Agenda

| Wed Feb. 4, 2015 12:38 AM EST

President Obama recently advanced two proposals designed to help the middle class—part of a middle-class agenda that's recently become something of a liberal rallying cry for the 2016 election. The first proposal was a mortgage plan available to anyone who bought a home. The second was a college tuition plan that would have helped middle-income workers with money saved by eliminating 529 college savings plans.

The mortgage plan has met with considerable enthusiasm. The tuition plan, by contrast, flamed out within days and has already been withdrawn. Mechele Dickerson comments:

While both of these proposals ostensibly targeted the middle class, the mortgage plan was lauded because its financial relief applies to all homeowners, regardless of how much they earned. The 529 proposal, by contrast, was doomed because of a fatal flaw: it actually tried to provide relief for just the middle class, carving it out by income.

The success of one and not the other was actually quite predictable. The mortgage proposal, though modest, was welcomed because it was designed to make it easier and cheaper for families to buy homes. Republicans, Democrats, Americans and the financial entities that benefit all agree that any plan that increases homeownership rates is good, even if most of the benefits go to higher-income households and barely reach the middle class.

....The same is true with 529 plans....Fewer than 3 percent of families save for college using 529 plans, according to Federal Reserve data....Since it’s the richest who have the largest accounts, most of the benefits of the tax break go to them. While the average account has about $20,000 in it, the accounts of the top 5 percent average more than $106,000.

This highlights one of the fundamental problems of liberal attempts to help the middle class. In theory, universal programs like Obama's mortgage plan are designed to help the middle class, and this is what makes them both popular and politically palatable. In practice, though, the bulk of their benefits usually go to the well off, and this is what really makes them politically palatable. That's why the tuition program met an instant death. It really did help the middle class—and only the middle class—and this meant it lacked the all-important political support of the well off. In fact, since the well off would be losing a benefit to pay for it, it attracted their instant opposition. And that was that.

As Dickerson says, the problem here is that the American definition of "middle class" is so broad. We basically have the poor on one end and the 1 percent on the other, and everyone in between considers themselves middle class. So if you say your program helps the middle class, it needs to help virtually everyone—including lots of people who make an awful lot of money. It's a good bet that virtually all of those folks with $106,000 in their 529 accounts think of themselves as middle class even if they earn well more than six-figure incomes.

Needless to say, this makes "middle class" programs really expensive. In practice, they have to be effectively universal, and since benefits often scale with income (as with tax deductions and savings plans), including the top 5 percent of the income ladder in these programs balloons their price tag by a whole lot more than 5 percent.

There are answers to this. You can offer tax credits rather than tax deductions. You can cap savings programs. But if you do very much of this, you effectively eliminate benefits for the well off and you lose their support. And as plenty of research has shown, it's the well off who really have political clout. This means you have to buy them off if you want to do something for the middle class, and that makes "middle class programs" a lot pricier than you'd think. It's something that any liberal agenda to help the middle class is going to have to figure out.

Congress Already Has Its Eyes on 2016

| Tue Feb. 3, 2015 1:47 PM EST

Steve Benen comments on the GOP's 56th vote to repeal Obamacare:

It’s quite a congressional majority, isn’t it? Nearly a month into the new Congress, Republicans have prioritized an oil-pipeline bill they know can’t pass, an immigration package they know can’t pass, changes to Wall Street safeguards they know can’t pass, anti-abortion legislation they know can’t pass, and anti-healthcare measures they know can’t pass.

Dear every pundit who said the GOP was ready prove it can be a governing party: go sit in the corner for a while.

In fairness, President Obama released a budget this week that he also knows can't pass. The truth is that both parties are jockeying for position right now, setting themselves up for the 2016 election. Republicans want to make sure their base is still with them, while Democrats are making a big play for the middle class. The symbolism of these votes is what's important right now, not whether they actually mean anything.

We should expect a lot more of this. There's going to be some compromising here and there in order to get a budget passed, but it's not clear to me that very much more than that will get accomplished. At this point, neither side really sees much upside in working on half measures when they might be able to get a full loaf after the next election.

2015 Would Be a Terrible Time for the Fed to Raise Interest Rates

| Tue Feb. 3, 2015 1:37 PM EST

The Fed has kept interest rates near zero for more than six years. With the economy finally showing signs of recovery, is it now time to think about raising rates a bit?

Normally, the answer might be yes: unemployment has trended down to below 6 percent, and orthodox theory suggests that at this level we'll start to see inflationary pressure that the Fed needs to respond to. However, as Paul Krugman points out, orthodox theory isn't telling the right story right now. Core inflation has been going down, not up, for the past two years, and it clocked in at about 1.4 percent in the most recent quarter. This is well below the Fed's target of 2 percent. So what's going on?

Recent data are perfectly consistent with the view that full employment requires an unemployment rate below 5 percent; the most recent data would suggest an even lower rate. This might or might not be right; I don’t know. But the Fed doesn’t know either.

And in the face of that uncertainty, the crucial question is what happens if you’re wrong. And the risks still seem hugely asymmetric. Raise rates “too late”, and inflation briefly overshoots the target. How bad is that?....Raise rates too soon, on the other hand, and you risk falling into a deflationary trap that could take years, even decades, to exit.

I really, really hope this is getting through.

The key issue here is probably an overreliance on the headline unemployment rate. It's now registering 5.6 percent, and under normal circumstances that would be about as low as you could expect it to go. But these aren't normal circumstances, and there's every reason to think that the headline rate isn't telling the whole story. If you look at broader measures, like the one on the right, you can see that we're still well above the level of 2006-07. There are still a whole lot of people who have simply given up looking for work and aren't being counted by the "official" numbers.

The picture is similar if you look at the employment-population ratio, which measures the total percentage of the population that's currently employed. It plummeted by nearly five percentage points during the great crash, and it's recovered less than a point of that loss over the past couple of years. There are several reasons for this, and some of this loss is permanent—the result of baby boomers retiring, for example. Still, this number probably needs to increase another couple of points before we can say we've truly reached full employment.

Finally, you can see the same story if you look at wages. If the economy were at full employment, we'd see not just inflation, but an increase in wages. So far we haven't. This is an almost certain sign that there are still plenty of people out of work who don't want to be.

Janet Yellen and the rest of the Fed are well aware of all this. It's hardly a secret. And as Krugman says, the risks here are all on one side. If it turns out that we really are at full employment and the Fed does nothing, all that happens is that we'll overshoot our inflation target for a short while. There's no harm in that, especially since we've been undershooting it for the past couple of years. But if we tighten too quickly? We risk an economic slowdown at a time when the global economy is still fragile.

This is no time to be taking chances. China is slowing down, Europe is back in recession and facing a possible Greek crisis, and emerging economies are looking distinctly dicey right now. The American economy might be the only engine keeping it all afloat. It's a lousy time to risk an economic downturn based on nothing more than a phantom fear of inflation.

Standard & Poor's Finally Pays Up For Bogus Mortgage Ratings

| Tue Feb. 3, 2015 12:44 PM EST

Standard & Poor's is finally paying up for its role in handing out bogus investment-grade ratings to risky mortgage securities during the housing bubble. Dean Starkman explains what happened:

In May 2004, as the U.S. housing market was heating up, Standard & Poor's Financial Services lost to a rival a huge deal to rate mortgage-backed securities to be issued by a major Japanese bank.

The reason? S&P's credit standards were too high, an employee complained to his boss. The company then went on to "downplay and disregard" its standards to win business, a federal lawsuit alleged, contributing to one of the most devastating financial collapses in history.

....One observer said the settlement would offer at least some accountability for a key player in the financial crisis. "Without the investment-grade ratings bestowed on pools of substandard mortgages, there would have been no mortgage crisis," said Jan Lawrence Handzlik of Los Angeles, a former federal prosecutor who specializes in white-collar criminal defense.

That's taking things too far. S&P and other ratings agencies certainly played a role in supercharging the housing bubble and thus contributing to its subsequent crash. Without the assurance of high ratings for CDOs and other securities that were full of fraudulent mortgages, there would have been less demand for those fraudulent mortgages. And lower demand would have meant fewer crappy mortgages, fewer defaults, and fewer problems with bank balance sheets full of toxic waste—which all came home to roost in 2008.

But there still would have been a housing bubble and a mortgage crisis, and the crash of 2008 still would have happened. The underlying factors that caused it were just too strong. Nonetheless, it's certainly true that if the bubble had been a little smaller, the crash would have been smaller too. We've all paid a big price for S&P's duplicity.

In any case, this morning the settlement with S&P was made official. They'll be paying a total of more than $1 billion:

The $1.37 billion penalty, like the statement of facts, is the product of compromise.

The penalty, half of which is earmarked for the federal government and the rest for the states, is large enough to wipe out S.&P.’s operating profit for a year, and is three times what S.&P. originally offered to settle before the Justice Department filed its lawsuit. But it also falls far short of the $3.2 billion that the government demanded after S.&P. initially refused to settle.

Is $1.37 billion enough? Probably not. But no one has ever paid more than a fraction of the damage they helped cause during the runup to the financial crash. S&P is just the latest to skate by with a ruler to the wrist but not much more.

Scott Walker Is Still Clearly a Work in Progress

| Mon Feb. 2, 2015 2:40 PM EST

I see that Martha Raddatz's interview with presidential wannabe Scott Walker is making the rounds today. And deservedly so! After listening to Walker blather a bit about America's need for "big, bold ideas," Raddatz asks him, "What is your big, bold, fresh idea in Syria?" Walker hems and haws a bit about being tough and aggressive, and then we get this:

RADDATZ: You don't think 2,000 air strikes is taking it to ISIS in Syria and Iraq?

WALKER: I think we need to have an aggressive strategy anywhere around the world. I think it's a mistake to —


RADDATZ: But what does that mean? I don't know what aggressive strategy means. If we're bombing and we've done 2,000 air strikes, what does an aggressive strategy mean in foreign policy?

WALKER: I think anywhere and everywhere, we have to be — go beyond just aggressive air strikes. We have to look at other surgical methods. And ultimately, we have to be prepared to put boots on the ground if that's what it takes, because I think, you know —

RADDATZ: Boots on the ground in Syria? U.S. boots on the ground in Syria?

WALKER: I don't think that is an immediate plan, but I think anywhere in the world —

RADDATZ: But you would not rule that out.

WALKER: I wouldn't rule anything out. I think when you have the lives of Americans at stake and our freedom loving allies anywhere in the world, we have to be prepared to do things that don't allow those measures, those attacks, those abuses to come to our shores.

So there you have it. Walker is so unprepared to talk about foreign policy that he gets quickly trapped into suggesting that we put more American troops into Iraq and Syria to fight ISIS. Did he really mean to do that? Or was he just feeling the pressure of a live interview and felt like he had to say something? Hard to say. A more experienced candidate would have tap danced a lot more effectively, probably with some prattle about arming our allies or something—though Raddatz undoubtedly would have pounced on that too.

Michael Tomasky remains pretty unimpressed with Walker, especially after finally listening to his big speech in Iowa from last weekend:

If this was the standout speech, I sure made the right decision in not subjecting myself to the rest of them. It was little more than a series of red-meat appetizers and entrees: Wisconsin defunded Planned Parenthood, said no to Obamacare, passed some kind of law against “frivolous” lawsuits, and moved to crack down on voter “fraud””—all of that besides, of course, his big move, busting the public-employee unions. There wasn’t a single concrete idea about addressing any of the major problems the country faces.

Well, that will come—though it's unlikely that Walker's ideas will be any different from the usual Republican boilerplate of the past decade or so. Lower taxes and less corporate regulation will supercharge the economy! Hooray!

Walker still has a ways to go before he's ready for prime time. But I'll bet he gets there. He'll learn from his mistakes, and he's just about the only Republican candidate who has potential appeal to both tea partiers and mainstream voters. Six months from now minor early stumbles like this will be ancient history, and he'll have his campaign schtick much more finely honed. He remains a serious contender.

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Here's the Birth of the Modern Anti-Vax Movement

| Mon Feb. 2, 2015 11:09 AM EST

A New York Times video takes a look at the birth of the belief that vaccinations can cause autism in young children:

It turns on a seminal moment in anti-vaccination resistance. This was an announcement in 1998 by a British doctor who said he had found a relationship between the M.M.R. vaccine — measles, mumps, rubella — and the onset of autism.

Typically, the M.M.R. shot is given to infants at about 12 months and again at age 5 or 6. This doctor, Andrew Wakefield, wrote that his study of 12 children showed that the three vaccines taken together could alter immune systems, causing intestinal woes that then reach, and damage, the brain. In fairly short order, his findings were widely rejected as — not to put too fine a point on it — bunk. Dozens of epidemiological studies found no merit to his work, which was based on a tiny sample. The British Medical Journal went so far as to call his research “fraudulent.” The British journal Lancet, which originally published Dr. Wakefield’s paper, retracted it. The British medical authorities stripped him of his license.

Nonetheless, despite his being held in disgrace, the vaccine-autism link has continued to be accepted on faith by some. Among the more prominently outspoken is Jenny McCarthy, a former television host and Playboy Playmate, who has linked her son’s autism to his vaccination: He got the shot, and then he was not O.K. Post hoc, etc.

This is, of course, even crazier than it sounds. It's one thing to be skeptical of the scientific community and its debunking of the Wakefield study. But it's now 2015. MMR vaccines that contain thimerosal—the supposed cause of autism—have been off the market for well over a decade. Not one single child has gotten a dose of thimerosal since about 2002. And yet, autism rates haven't gone down. They've gone up. You don't need to trust scientists to see that, very plainly, thimerosal simply never played any role in autism. And there's never been any reason to think that any other vaccine does either.

And yet, there's apparently nothing that will convince certain parents of this. At least, if there is, no one has figured it out yet. Sigh.

Blogging Isn't Dead. But Old-School Blogging Is Definitely Dying.

| Sat Jan. 31, 2015 12:32 PM EST

With Andrew Sullivan giving up his blog, there are fewer and fewer of us old-school bloggers left. In this case, "old school" pretty much means a daily blog with frequent updates written by one person (or possibly two, but not much more). Ezra Klein thinks this is because conventional blogging doesn't scale well:

At this moment in the media, scale means social traffic. Links from other bloggers — the original currency of the blogosphere, and the one that drove its collaborative, conversational nature — just don't deliver the numbers that Facebook does. But blogging is a conversation, and conversations don't go viral. People share things their friends will understand, not things that you need to have read six other posts to understand.

Blogging encourages interjections into conversations, and it thrives off of familiarity. Social media encourages content that can travel all on its own. Alyssa Rosenberg put it well at the Washington Post. "I no longer write with the expectation that you all are going to read every post and pick up on every twist and turn in my thinking. Instead, each piece feels like it has to stand alone, with a thesis, supporting paragraphs and a clear conclusion."

I'd add a couple of comments to this. First, Ezra is right about the conversational nature of blogging. There was lots of that in the early days, and very little now. Partly this is for the reason he identified: traffic is now driven far more by Facebook links than by links from fellow bloggers. Partly it's also because multi-person blogs, which began taking over the blogosphere in the mid-aughts, make conversation harder. Most people simply don't follow all the content in multi-person blogs, and don't always pay attention to who wrote which post, so conversation becomes choppier and harder to follow. And partly it's because conversation has moved on: first to comment sections, then to Twitter and other social media.

Second, speaking personally, I long ago decided that blog posts needed to be standalone pieces, so I'm not sure we can really blame that on new forms of social media. It was probably as early as 2005 or 2006 that I concluded two things. Not only do blog posts need to be standalone, but they can't even ramble very much. You need to make one clear point and avoid lots of distractions and "on the other hands." This is because blog readers are casual readers, and if you start making lots of little side points, that's what they're going to respond to. Your main point often simply falls by the wayside. So keep it short and focused. If you have a second point to make, just wait a bit and write it up separately not as a quick aside open to lots of interpretation, but with the attention it deserves.

And there's a third reason Klein doesn't mention: professionalism. I was one of the first amateur bloggers to turn pro, and in my case it was mostly an accident. But within a few years, old-school media outlets had started co-opting nearly all of the high-traffic bloggers. (I won't say they co-opted the "best" bloggers, because who knows? In any case, what they wanted was high traffic, so that's what they went for.) Matt Yglesias worked for a series of outlets, Steve Benen took over the Washington Monthly when I moved to MoJo, Ezra Klein went to the Washington Post and then started up Vox, etc. Ditto for Andrew Sullivan, who worked for Time, the Atlantic, and eventually began his own subscription-based site. It was very successful, but Sullivan turned out to be the only blogger who could pull that off. You need huge traffic to be self-sustaining in a really serious way, and he was just about the only one who had an audience that was both large and very loyal. Plus there's another side to professionalism: the rise of the expert blogger. There's not much question in my mind that this permanently changed the tone of the political blogosphere, especially on the liberal side. There's just less scope for layman-style noodling when you know that a whole bunch of experts will quickly weigh in with far more sophisticated responses. Add to that the rise of professional journalists taking up their own blogs, and true amateurs became even more marginalized.

All of this led to blogs—Sullivan excepted—becoming less conversational in tone and sparking less conversation. There are probably lots of reasons for this, but partly I think it's because professional blogs prefer to link to their own content, rather than other people's. Josh Marshall's TPM, for example, links almost exclusively to its own content, because that's the best way to promote their own stuff. There's nothing wrong with that. It makes perfect sense. But it's definitely a conversation killer.

In any case, most conversation now seems to have moved to Twitter. There are advantages to this: it's faster and it's open to more people. Blogs were democratizing, and Twitter is even more democratizing. You don't have to start up your own blog and build up a readership to be heard. All you have to do is have a few followers and get rewteeted a bit. Needless to say, however, there are disadvantages too. Twitter is often too fast, and when you combine that with its 140-character limit, you end up with a lot of shrill and indignant replies. Sometimes this is deliberate: it's what the tweeter really wants to say. But often it's not. There's a premium on responding quickly, since Twitter conversations usually last only hours if not minutes, and this means you're often responding to a blog post in the heat of your very first reaction to something it says—often without even reading the full blog post first. In addition, it's simply very difficult to convey nuance and tone in 140 characters. Even if you don't mean to sound shrill and outraged, you often do. Now multiply that by the sheer size of Twitter, where a few initial irate comments can feed hundreds of others within minutes, and you have less a conversation than you do a mindless pile-on.

I'm not really making any judgments about all this. Personally, I miss old-school blogging and the conversations it started. But I also recognize that what I'm saying about Twitter is very much what traditional print journalists said about blogging back in the day. You have to respond within a day! You have to make your point in 500 words or less! Whatever happened to deeply considered long-form pieces that took weeks to compose and ran several thousand words? Sure, those conversations took months to unfold, but what's the rush?

Well, they were right to an extent. And now conversations have become even more compressed. Some people think that's great, others (like me) are more conflicted about it. When I respond to something, I usually want to make a serious point, and Twitter makes that awfully hard. Writing a coherent multi-part tweet is just way harder than simply writing a 500-word blog post. On the other hand, the tweet will get seen by far more people than the post and be far more timely.

As with everything, it's a tradeoff. I miss old-school blogging. A lot of people say good riddance to it. And the world moves on.

Friday Cat Blogging - 30 January 2015

| Fri Jan. 30, 2015 2:40 PM EST

My fatigue level is off the charts today. I have no idea what's causing this. But there are always plenty of catblogging pictures available, and you can hardly go wrong with Hilbert in a bag, can you? Enjoy.

Housekeeping Note

| Thu Jan. 29, 2015 9:00 AM EST

My chemotherapy, which until now has had fairly predictable side effects, seems to have entered a less predictable phase. This means that my fatigue level changes from day to day, and with it my blogging output. So some days you'll see a bunch of posts, and other days you'll see one or two. It doesn't really mean anything is wrong. It just means I'm having a predictably unpredictable bad day.

In addition, today I have several appointments, and Marian is undergoing major surgery. Nothing life-threatening, so no worries on that score. But a very big deal nonetheless.

In other words, there's not likely to be any blogging today. Tomorrow, who knows? As they say, tomorrow is another day.

4 PM UPDATE: According to the surgeons, Marian's surgery was entirely successful. She's still waking up from the anesthesia and has several weeks of recovery ahead of her, but everything went fine.