Kevin Drum

Who Gets Special Access to Comcast's Customers? Who Decides?

| Mon Mar. 24, 2014 10:46 AM PDT

Things that make you go "hmmm":

Apple Inc. is in talks with Comcast Corp. about teaming up for a streaming-television service that would use an Apple set-top box and get special treatment on Comcast's cables to ensure it bypasses congestion on the Web, people familiar with the matter say.

....Under the plan Apple proposed to Comcast, Apple's video streams would be treated as a "managed service" traveling in Internet protocol format—similar to cable video-on-demand or phone service. Those services travel on a special portion of the cable pipe that is separate from the more congested portion reserved for public Internet access.

People familiar with the matter said that while Apple would like a separate "flow" for its video traffic, it isn't asking for its traffic to be prioritized over other Internet-based services.

Making video-on-demand operate properly requires careful engineering. It doesn't work if you just dump it out on the public internet and call it a day. However, that careful engineering costs money, and it's not unfair for companies to demand reasonable compensation of some sort if they're the ones who bear the costs.

But who decides what's reasonable and what isn't? In a competitive market, the market eventually decides. Price signals and competition do the heavy lifting with only light government regulation to set a level playing field and police the worst abuses. But when companies like Comcast have effective monopoly control over internet access in their territories, who decides then? There are no market forces to rely on, which means that Comcast gets to decide unilaterally. So, for example, when Netflix finally agrees to pay a fee to Comcast for delivery of its video content, the quality of Netflix transmissions miraculously goes up almost instantly. Apparently there were no infrastructure issues at all and no special buildout costs. It was just a matter of Comcast extorting some extra revenue from Netflix.

The Apple case is different in the details, but it raises the same basic principle: Who decides? Who gets special access to Comcast's customer base? Who gets shut out? The market can't provide any guidance because Comcast has little genuine competition in this space.

So who decides?

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Chart of the Day: Social Security Is More Important Than Most People Think

| Mon Mar. 24, 2014 9:06 AM PDT

EBRI's annual Retirement Confidence Survey is out, and you can find it here if you want to read the whole thing. In a nutshell, retirement confidence dropped sharply in 2008 when the Great Recession started, and finally started to increase a bit this year for the first time since then. Nonetheless, the number of people who are confident they have enough to retire on is still around 55 percent, way below the 70 percent who felt this way during the 90s and aughts.

There are plenty of interesting facts and figures about retirement in the report, and I've excerpted an interesting pair of charts about worker expectations of Social Security below. These numbers have bounced around a bit over the years, but generally speaking, only about a third of active workers think Social Security will be a major part of their retirement. In reality, about two-thirds of actual retirees report that Social Security is a major part of their income. Keep that in mind the next time you hear someone blithely talking about cutting Social Security benefits, especially among low-income workers.

It's Time For Some Obamacare Success Stories

| Mon Mar. 24, 2014 7:44 AM PDT

Vincent Rizzo, who suffers from Type 2 diabetes, has gone without health insurance for 10 years. "We got 30 denial letters," his wife says. But then along came Obamacare, and now both Rizzos are covered for $379 a month, with a $2,000 family deductible. Michael Hiltzik compares their story to that of all the Obamacare horror stories making the rounds:

You haven't heard Rizzo's story unless you tuned in to NBC Nightly News on New Year's Day or scanned a piece by Politico about a week later. In the meantime, the airwaves and news columns have been filled to overflowing with horrific tales from consumers blaming Obamacare for huge premium increases, lost access to doctors and technical frustrations — many of these concerns false or the product of misunderstanding or unfamiliarity with the law.

While Rizzo was working her way to thousands of dollars in annual savings, for example, Southern California Realtor Deborah Cavallaro was making the rounds of NBC, MSNBC, CNBC, CBS, Fox and public radio's Marketplace program, talking about how her premium was about to rise some 65% because of the "Unaffordable" Care Act. What her viewers and listeners didn't learn was that she hadn't checked the rates on California's insurance exchange, where (as we determined for her) she would have found a replacement policy for less than she'd been paying.

So why do we hear so much about folks like Cavallero, and Bette from Spokane, and the infamous Julie Boonstra? Good question. More to the point, with Obamacare's website problems largely solved, and with the initial signup period coming to a close with a relatively high participation rate, will we start hearing these stories soon? Especially in swing states where the horror stories are getting so much play? Click the link for some speculation.

Chart of the Day: Republicans Stick Together No Matter What Kind of District They Represent

| Sun Mar. 23, 2014 10:52 AM PDT

Here's an interesting chart from Ryan O'Donnell. It shows voting patterns for members of Congress based on what kind of district they represent. Among Democrats, as you'd expect, their voting records become more progressive as their districts become more strongly Democratic (blue line). What's more, there's a sharp break at zero. When a district becomes even slightly majority-Democratic, voting records become sharply more progressive.

But you see nothing of the kind among Republicans. The red line is nearly flat. There's virtually no difference in their voting records regardless of how strongly Republican their district is. Even when they represent moderately Democratic districts, it doesn't matter. They still vote monolithically conservative.

Now, it's possible that this is merely an artifact of Republicans being the out-of-power party. When you're faced with a president of the opposite party, maybe it's just easier to maintain a united front of obstruction. Someone could shed some light on this by creating a similar chart for 2001-06, when it was House Democrats who were facing a president of the opposite party.

But I suspect that's not it. Or at least, not the whole story. Modern Republicans are both more cohesive and more ideological than Democrats (virtually none have a progressive score above 20, while lots of Democrats have scores below 80). Nor do they pay a price for this. Voters in pinkish districts don't seem to mind electing members of Congress with strongly red voting records. I guess they figure that as long as they vote against higher taxes, it doesn't much matter if they waste time on lots of symbolic sops to the tea party.

Could Democrats in light bluish districts act the same way? They sure don't seem to think so. Comments?

What's the Difference Between Barton Gellman and Glenn Greenwald?

| Sun Mar. 23, 2014 8:58 AM PDT

Glenn Greenwald makes a point worth repeating today about the steady publication of stories based on the documents Edward Snowden provided to several media outlets last year:

(1) Edward Snowden has not leaked a single document to any journalist since he left Hong Kong in June: 9 months ago. Back then, he provided a set of documents to several journalists and asked that we make careful judgments about what should and should not be published based on several criteria. He has played no role since then in deciding which documents are or are not reported.

....(2) Publication of an NSA story constitutes an editorial judgment by the media outlet that the information should be public. By publishing yesterday’s Huawei story, the NYT obviously made the editorial judgment that these revelations are both newsworthy and in the public interest, should be disclosed, and will not unduly harm “American national security.” For reasons I explain below, I agree with that choice. But if you disagree — if you want to argue that this (or any other) NSA story is reckless, dangerous, treasonous or whatever — then have the courage to take it up with the people who reached the opposite conclusion: in this case, the editors and reporters of the NYT.

There's more at the link, but it's worth noting that although Greenwald himself is the subject of routine suggestions of treason-esque behavior, very rarely is the Washington Post's Barton Gellman given the same treatment. But Gellman has been responsible for some of the biggest stories to date based on the Snowden documents.

Why the difference? Obviously Greenwald has placed himself in the public eye more than Gellman has, but that's hardly sufficient explanation. What matters is what gets published. And the truth is that, as near as I can tell, nearly every single document that Greenwald has published so far would also have been published by the Post or the New York Times if they had gotten to it first. He hasn't done anything that these pillars of American journalism haven't done too.

What Are Your Favorite Comedies?

| Sat Mar. 22, 2014 9:00 AM PDT

They say you can tell more about a person by what he laughs at than by what he cries at. With that in mind, here are ten of my favorite film comedies in no particular order. As you can see, I basically like jokefests. There is little trace of sophistication here:

  • Real Genius
  • Life of Brian
  • Office Space
  • Groundhog Day
  • Dirty Rotten Scoundrels
  • Airplane!
  • This is Spinal Tap
  • Dodgeball
  • Galaxy Quest
  • The Big Lebowski

Marian and I both thought this Minute Maid commercial was funny. I remember telling her that it showed the difference in our senses of humor. I liked it for the first part; she liked it for the second part:

Among older, classic comedies, I would probably choose anything starring Cary Grant and let it go at that. What are your favorites?

JUST FOR THE RECORD: I limited my list to one film per actor/director. So only one Monty Python film, one Steve Martin film, one Abrahams/Zucker film, etc. There are no Mel Brooks films because I'm not really much of a Mel Brooks fan.

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Friday Cat Blogging - 21 March 2014

| Fri Mar. 21, 2014 11:53 AM PDT

In the previous post I mocked Richard Branson's advice that "You only live one life, so I would do the thing that you are going to enjoy." However, I was referring only to human beings in that post. Cats are different. Domino has taken Branson's advice fully to heart and does only things that she enjoys. For example, curling up on her favorite blue blanket and giving me the eye. She enjoys that! A few minutes later she will follow one of her other passions and curl up on the patio. Then she'll curl up on my lap. You get the idea. She is fully committed to doing only what she loves.

Here's Some Better Life Advice Than Richard Branson's

| Fri Mar. 21, 2014 11:47 AM PDT

Richard Branson has a life tip for us all: "You only live one life, so I would do the thing that you are going to enjoy." Tyler Cowen says, "The rest of the advice, more pedestrian, is here."

Holy cow! What could possibly be more pedestrian than that? Is there any rich and successful person in the entire world who hasn't given the rest of us this advice?

Now, in fairness, Cowen was referring to the other piece of Branson's advice: have a sofa in your kitchen. "The truth is, so long as you've got a kitchen which has space for a sofa, and a bedroom, and a partner that you love, you don't necessarily need the add-ons in life." Uh huh. Can I translate this? "If you have enough money to buy a house with a ginormous kitchen that can comfortably accommodate a sofa, you're probably doing OK." If I tried to put a sofa in my kitchen, there would be no kitchen left.

I know I'm being cranky, but I am sick to death of rich people telling us to "follow our passion" or something similar. (In a 10-part list, Branson repeats this advice in five different forms.) Some of us, of course, are lucky enough to get to do that. I've come pretty close, for example. But for most of us, this is a recipe for going broke. That's because, sadly, the world tends to assign a low market value to most of our passions.

Here's some better advice: try to avoid stuff that you hate. I admit that this is less uplifting, but it's generally more achievable and produces reasonable results. You might not ever get your dream job, or your dream house, or your dream partner, because that's just the way the lottery of life works. But with a little bit of effort, you might be able to avoid a soul-crushing job, a two-hour commute, and an empty relationship. Maybe. It's worth a try, anyway.

But honestly, most of us are better off saving our passions for our hobbies. This won't get me invited to give any commencement speeches, but it's still pretty solid advice.

There's a Reason that Right-Wing Crackpots are More Newsworthy Than Lefty Crackpots

| Fri Mar. 21, 2014 10:14 AM PDT

Dave Weigel is tired of the liberal press getting all hot and bothered every time some fringe Republican nutball says something stupid. Fair enough. But today he provides yet another example and then makes a problematic comparison:

To date, nearly 90,000 people have "liked" or "shared" a story tagged "Candidate Who Blames Gay Rights for Tornadoes Scores Big GOP Win." The candidate is Susanne Atanus, "who believes that God dictates weather patterns and that tornadoes, autism and dementia are God's punishments for marriage equality."

What's missing from the story? Atanus' status as a fringe candidate. She's running in Illinois' 9th District, which covers the liberal northern suburbs of Chicago....Susanne Atanus will never, ever serve in Congress.

....Both parties are going to be cursed with a few idiot candidates this year....In 2012 the declining Tennessee Democratic Party accidentally nominated a conspiracy-minded flooring installer for U.S. Senate. The media did not hustle down to Nashville and Memphis to cover him. No Democrat in another state was asked whether they agreed with this candidate about the NAFTA superhighway or the "Godless new world order."

Why didn't the media hustle down to Nashville to interview Mark Clayton? Wikipedia does as good a job as anyone explaining it:

Tennessee's Democratic Party disavowed the candidate over his active role in the Public Advocate of the United States, which they described as a "known hate group". They blamed his victory among a slate of little-known candidates on the fact that his name appeared first on the ballot, and said they would do nothing to help his campaign, urging Democrats to vote for "the write-in candidate of their choice" in November.

In the case of Clayton, nobody thought he represented the secret id of the Democratic Party. And the local party went out of its way to make sure Clayton was well and truly shunned as a crackpot they wanted nothing to do with.

Has anything similar happened in Illinois? Has the Republican Party denounced Atanus and urged voters to cast their ballots for someone else? No they haven't. [Actually, yes they have. See update below.] Do reporters believe that Atanus does indeed represent a significant segment of the modern Republican base? Yes they do. Is this fair? Well....yes. It kind of is fair, isn't it?

As it happens, I think that fringey right-wing candidates get less attention than Weigel believes. Sure, HuffPo plays them up, for the same reason they have a whole staff devoted to finding and posting sideboobs. It's clickbait for the online hordes. But does the rest of the media obsess about the Susanne Atanuses of the world? Not really. Not if you're a normal, casual news consumer, rather than an omnivore like Weigel and all the rest of us bloggy denizens. And to the extent they do cover the right-wing crackpots more than the lefty variety, the truth is that it's pretty justified. These folks represent a real constituency, and the mainstream of the Republican Party, far from disowning them, practically falls all over itself to insist that they have nothing but admiration and respect for their willingness to stand up and fight for traditional values without compromise. That makes them worth a story.

UPDATE: Hey, it turns out that the media did write about Mark Clayton. The liberal media, that is. Here is MoJo's own Tim Murphy writing on the day after the primary.

UPDATE 2: Weigel points out that the chairman of the Illinois GOP did indeed denounce Atanus after her gaffe. Fair point. Still, she's hardly the first conservative to blame our problems on God's wrath against liberal hedonism. It's not unreasonable to think she represents a persistent strain of conservative thought and therefore deserves a bit of attention.

Capital vs. Labor in the US and Great Britain

| Fri Mar. 21, 2014 9:39 AM PDT

In the United States, the labor share of income has been declining steadily since about 2000. The same was true in Great Britain—until the Great Recession hit. Since 2010, the labor share of income has gone down 5 percent in the US and gone up 5 percent in the UK.

Why? Another way of describing what happened is that labor productivity continued rising in the US but declined in the UK. When labor is more productive, you need less of it, and that's what happened here. But again: why? Jason Douglas passes along some speculation:

Ben Broadbent, the Bank of England’s next deputy governor for monetary policy, showed students at the London School of Economics an interesting chart in a speech he gave back in January that shows that wages as a share of national income actually rose inBritain in the past few years, a period of deep recession and subsequent stagnation that Britain is only now climbing out of. Corporate profits’ share of the cake declined. In the U.S., the opposite happened.

Why might this divergence have occurred?....He challenged the students in his audience to come up with an explanation as to why the two economies had such a different experience. One possible explanation, according to economists, is that companies in the U.S. pruned their workforces more severely when the downturn hit than British firms did. British bosses, faced with higher layoff costs and wary of losing skilled staff as they did in previous recessions, decided to keep as many workers on as they could and take the hit instead to their bottom line.

But that still doesn't answer the question. Why were British bosses wary of losing skilled staff but US bosses weren't? It's true that labor markets are more regulated in Britain than they are here, which makes it more expensive to lay off workers, but they aren't a lot more regulated. In previous recessions and recoveries, Britain and the US followed almost identical trajectories.

Perhaps a more useful framework for analyzing this is to look instead at capital shares, which are the mirror image of labor shares. This means that in the US, the capital share of income has gone up, while in the UK it's gone down. Even if layoffs and wage growth followed similar paths in both countries, that could happen if capital returns recovered faster on this side of the Atlantic. And that's plausible: In the US, the financial sector has fully recovered from the recession and is now as big and profitable as it was in the mid-aughts. In the UK, the financial sector was treated more sternly and still hasn't fully recovered from the recession.

This may be about to change, as US banks run into headwinds and Dodd-Frank regulations start to bite. And in any case, this is mostly just a guess on my part. Still, it strikes me as a potentially more fruitful lens to look through. Thoughts welcome.