Kevin Drum

Republicans Love Giving Away Free Stuff — But Only to People Who Already Have Lots of Stuff

| Mon Nov. 2, 2015 12:10 PM EST

Over at Vox, Christopher Faricy tells us that both Democrats and Republicans like to give away free stuff:

The main difference between the two political parties is not whether to deliver government benefits to supporters but rather who those supporters are. The Republican Party’s core socioeconomic voting groups are wealthier households and businesses, both of which benefit when social welfare is provided through the tax code rather than through explicit spending.

We are talking here of tax expenditures, that lovely oxymoron in which welfare for the rich is disguised as a tax cut. Tax expenditures include just about anything that gives people a tax break: health savings accounts, retirement accounts, the mortgage interest deduction, and so forth. These are usually pitched as ways to help the average Joe, but in fact the average Joe usually doesn't take much advantage of them. And when the average Joe does, his tax rate is low enough that it doesn't help much.

But high earners are a different story. About 70 percent of the benefit of all tax expenditures goes to top earners. For that reason, the chart on the right should come as no surprise: Republicans love tax expenditures, while Democrats are lukewarm about them. On average, tax expenditures have gone up about 12 percent under Republicans, but less than 5 percent under Democrats.

Bottom line: To quote Jeb Bush, the Republican message is "Get in line, and we'll take care of you with free stuff." But only if the free stuff goes to corporations and the wealthy.

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Marijuana Legalization Is the New Gay Marriage

| Mon Nov. 2, 2015 11:36 AM EST

Now that gay marriage is legal, what's next? We liberals need a new movement that will once again put conservatives on the wrong side of history. The LA Times reports the answer might be marijuana:

The latest sign was the full-throated call last week by Sen. Bernie Sanders to end federal prohibition. With that one move, the candidate for the Democratic presidential nomination plunged into uncharted territory — and, arguably, so did the presidential race. Never before has a contender with so much to lose so unequivocally suggested that smoking a joint should be viewed the same as drinking a beer, at least in the eyes of the law.

....Hillary Rodham Clinton has told small audiences in the pot havens of Oregon and Colorado that marijuana businesses in states where it is legal need relief from federal restrictions that can make it impossible for them to operate.

Back in 2009—in a piece whose headline I still don't get—I predicted that marijuana would be generally legal by 2019. That's only a bit more than three years away, and so far it's legal in only four states (Washington, Oregon, Colorado, Alaska). However, 24/7 Wall St., which rather charmingly tracks marijuana commodity prices compiled by New Leaf Data Services,1 thinks another 11 states are getting close. And the latest Gallup poll shows that 58 percent of American favor pot legalization. That's not quite up to the magic two-thirds level that's often the tipping point for broad social change, but it's close. We might get there by 2019 yet.

1Here's the latest: "For the week ended Friday, October 30, the spot price index for a pound of cannabis increased by $51 (2.7%) from $1,790 in the prior week to $1,839. The simple (non-volume weighted) average price for a gram increased by 22 cents to $4.58." Futures and forward prices were also up.

New Study Suggests That ADA Works Pretty Well In the Job Market

| Mon Nov. 2, 2015 10:51 AM EST

If you're a hiring manage and you've been getting a lot of resumes lately, this might not have anything to do with an improving economy. It might instead be due to the blizzard of academic research that's conducted by sending out thousands of resumes with tiny differences in order to figure out how hiring managers respond to race/college/political party/hobbies/etc. The latest experiment is to see how hiring managers respond to disabilities, and the results are more interesting than you might think. Here are the basic results:

No surprise here. If you indicate that you have any kind of disability, there's less interest in hiring you, and these results are consistent across all sizes of companies—though they're more pronounced in small companies—and across both private-sector and public-sector employers. But now take a look at this:

When it comes to getting an actual callback, small companies are far less likely to respond if you have a disability. But larger companies show little discrimination at all. In fact, many of them are more likely to call you back if you have a disability. The most dramatic difference is among government hiring managers: if you don't have a disability, no callback. If you do have a disability, the rate of callbacks is the highest in the study. The authors provide the most obvious explanation:

Given that small employers are not subject to the ADA, this result suggests that small employers are engaging in discrimination while the ADA is constraining discriminatory behavior of medium and large employers. The story is complicated, however, by the lack of clear changes in employer responses at the ADA employment threshold...and by consideration of state DDL’s....This latter result may be due to a lack of knowledge of state laws among small employers, while the federal ADA is much better known. Large employers are more likely to have formal HR departments that will be aware of both the ADA and state requirements, and may be more likely to have prior experience in hiring people with disabilities so they are more comfortable in considering applicants with disabilities.

So the picture is complicated, but the most likely interpretation is that ADA has been fairly successful in the job market. If you pass a law that forbids discrimination, and then enforce it, you get results. It's yet another example of big government working pretty well.

A Billionaire Sued Us. We Won. But We Still Have Big Legal Bills to Pay.

| Sun Nov. 1, 2015 10:30 PM EST

By now, you've probably read about Mother Jones' landmark legal win against Frank VanderSloot, a billionaire political donor. If you haven't, you can read the full backstory here (it's riveting). Or, if you're feeling lazy, here's the TL;DR version:

After the Citizens United decision allowed wealthy political donors to drastically increase their spending, we wrote a piece about one such donor: Frank VanderSloot. He and his company were among the biggest donors to Romney's super-PAC. It was a straightforward bit of investigative reporting: letting readers know who was funding the campaign.

VanderSloot saw it differently. His lawyers sent us letters complaining about the piece. We didn’t retract our story, and in 2013 he sued us for defamation. Earlier this month, shortly before the case was set to go to trial, an Idaho judge dismissed the lawsuit, finding that our reporting was accurate and that the article was protected under the First Amendment.

It was a huge victory. We were up against a powerful billionaire and we won. But it came at a great cost: at least $2.5 million for us and our insurer, and $650,000 in out-of-pocket expenses for Mother Jones, to be precise. Everyone's been asking whether we can recoup our attorney's fees from VanderSloot, but unfortunately the answer is no.

The win means a lot to me, personally, too. As someone who writes about rich and powerful people, it's good to know that the First Amendment is alive and well. And it makes me beyond proud to write for Mother Jones: Not too many other shops would have had the guts to fight back, but we knew you'd expect us to, and that you'd have our back if we took a stand.

If you haven't already, can you pitch in to help us pay our legal bills? If you can, your donation will be doubled by First Look Media's Press Freedom Litigation Fund—they're matching up to $74,999 in donations (the same amount VanderSloot sued us for). You can give by credit card or PayPal.

Republican Candidates Agree on List of Debate Demands

| Sun Nov. 1, 2015 8:47 PM EST

After last week's CNBC fiasco, Republican candidates for president are meeting tonight to discuss their conditions for participating in future debates. A source with one of the campaigns has been texting me from inside the meeting with a list of their demands:

  1. There will be no "gotcha" questions about math.
  2. All graphics that appear beside candidates must be approved by the campaign.
  3. There will be a ten-minute break halfway through the debate.
  4. Each candidate will be allowed to phone a friend for one question.
  5. All 14 candidates will be allowed on the main stage. At the end of each 15-minute period, candidates will vote one participant out of the debate. In the final round, the seven remaining candidates will get to ask the moderators questions.
  6. No non-English speaking networks will be allowed to participate.
  7. Each podium will include the candidate's website address in a minimum of 3-inch type.
  8. Male moderators must wear red ties.
  9. Each campaign will be allowed to veto a maximum of two moderators each.
  10. Fox News will be exempt from all these rules.
  11. Candidates can "steal" a question from another candidate once per debate.
  12. Frank Luntz "dial" responses will be run across the screen in real time.

Three of these are real and have been seriously discussed. Can you guess which ones? Answer here.

Marijuana for Millionaires

| Sun Nov. 1, 2015 2:31 PM EST

Yesterday a friend emailed to ask if I had any thoughts about Ohio's Issue 3, which would fully legalize marijuana cultivation and sale in the state. Ohio? I barely pay attention to California, let alone Ohio.

But Issue 3 turns out to be surprisingly fascinating—or venal and repellent, depending on your tolerance for sleaze. Apparently one of the authors of the initiative came across a Rand report on marijuana written by a bevy of drug-policy worthies, and it offered up a dozen possible options for legalization. One of them is called "structured oligopoly":

It is natural to ask whether there is some way to get for-profit businesses to behave in the public interest. The answer is “Perhaps.”

....States might prefer [] to offer only a limited number of licenses, creating artificial scarcity that makes the licenses valuable—valuable enough that firms will have a strong incentive to cooperate with regulators rather than risk revocation....Limiting the number of licensees also makes monitoring their behavior easier. A rogue company could more easily break the rules if it were one of 1,000 licensees than if it were one of just ten.

....So a structured-oligopoly strategy might involve licensing a limited number of firms, monitoring them closely, and not being shy about rescinding a firm’s license if it behaves in ways contrary to the public interest.

This might not be your cup of tea, but let's stipulate that it has some potential. How would you distribute these licenses? The straightforward approach is to auction them off for set periods. Unfortunately, this has a big drawback: it maximizes the payment for licenses, and thus minimizes the profit of the oligopolists. This is obviously vexing.

So how about this instead? Pick out ten rich friends. Each is required to put up $2 million to help pass a ballot initiative. In return, you promise to write the names of the investors directly into the initiative, giving them a perpetual and exclusive right to grow marijuana in the state of Ohio.1 In addition, you write a special, unalterable flat tax rate into the law, as well as a minuscule annual licensing fee. Now that's an oligopoly you can believe in! Keith Humphreys, who brought this to my attention, has a few comments:

It has taken the alcohol industry decades of lobbying to roll back many of the restrictive, public health-oriented regulations established after the end of Prohibition. Booze industry executives must look with envy upon the emerging marijuana industry, which can use the ballot initiative process to achieve complete regulatory capture from day one.

....No one should be surprised that in a country with an entrepreneurial culture, a commitment to free markets, and a political system highly attuned to corporate donations, legalized marijuana would develop a significant corporate presence. Indeed, many drug policy analysts, including me, expected this to happen eventually. But the rate at which the change is happening is truly startling, and will become even more so if the Ohio initiative passes.

If the marijuana industry ends up being a clone of the tobacco industry, will legalization supporters experience buyers' remorse? It depends who you ask.

Well, you could ask me. I don't care what they're legalizing. This stinks. It's crony capitalism without even a veneer of decency, and if it applied to anything else nobody would have the gall to ever let it see the light of day. If this is the price of pot legalization, count me out.

1Technically, no names are actually in the initiative. Instead, it limits marijuana cultivation to ten specific parcels of land that are owned by the ten investors. Also, individuals are allowed to cultivate small amounts for their own recreational use if they get a license.

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Carly Fiorina Has Found a New Dedication to the Truth. Let's Help Her Out.

| Sun Nov. 1, 2015 12:19 PM EST

Good news! Carly Fiorina has turned over a new leaf and now admits that she was mistaken to say that 92 percent of the jobs lost under President Obama belonged to women:

“The fact-checkers are correct," she said....Fiorina then criticized the “liberal media” for picking apart the statistic rather than her broader argument, which was that liberal polices are bad for women economically.

“It is factually true that the number of women living in extreme poverty is at the highest rate in recorded history,” she said. “It is factually true that 16.1 percent of women live below the poverty line, the highest level in 20 years. It is factually true that 3 million women have fallen into poverty.”

This is good news for fans of factually correct statistics. And Fiorina got all of her facts right! Still, since liberal media shill Martha Raddatz1 decided not to investigate any of these facts further, I'll go ahead and make a few wee points myself:

  • Fiorina only looked at the women's poverty rate for the past 20 years. Why? Because the highest levels ever were in 1982, under Ronald Reagan, and 1992, under George H.W. Bush.
  • It's true that the absolute number of women in poverty is at its highest level ever. Needless to say, this is only because the population is bigger than it was under Reagan and Bush.
  • The current rate of women in poverty is indeed 16.1 percent according to the Census Bureau. Does this mean that liberal policies are bad for women? Well, that number went up 3 percent during George W. Bush's term and has (so far) gone down 0.2 percent during Barack Obama's term. I report, you decide.2

Since Fiorina is now dedicated to getting her facts straight, I figured she'd appreciate this clarification. You're welcome, Carly.

1You may recall her as the moderator of the vice-presidential debate in 2012, during which she pummeled Paul Ryan over and over about his fantasy budget math.

2But in case you're having trouble deciding, the basic answer here is that poverty goes up during recessions and goes down during economic expansions. The only exceptions to this rule are under George H.W. Bush, who saw an increase starting in 1989, and George W. Bush, who oversaw in increase starting in 2006.

Want a Safer City? Keep Daylight Savings Time Year Round!

| Sat Oct. 31, 2015 6:06 PM EDT

Tonight we bid sadly adieu to daylight savings time. That means this is also the time of year for a spate of stories about whether daylight savings time makes sense. Sure, you get more daylight, which cuts down on lighting bills, but it's colder in the morning, which increases heating bills. But wait! There's more time for golf, and that helps the economy. Etc. Economists have conducted ever more sophisticated natural experiments about this, and the ultimate answer is....meh. Maybe it's a tiny economic benefit, maybe it's a tiny economic loss. Who knows?

But now we have a new study. The authors ditch the whole economic benefit argument and instead justify DST based on lower crime rates:

They found that "when DST begins in the spring, robbery rates for the entire day fall an average of 7 percent, with a much larger 27 percent drop during the evening hour that gained some extra sunlight." The mechanism that might cause this drop is fairly simple: "Most street crime occurs in the evening around common commuting hours of 5 to 8 PM," the authors write, "and more ambient light during typical high-crime hours makes it easier for victims and passers-by to see potential threats and later identify wrongdoers."

Moreover, according to the paper, the drop in crime during evening hours wasn't accompanied by a rise in crime during the morning hours. Criminals aren't morning people, as it turns out. In addition to the decrease in robbery rates, the researchers found "suggestive evidence" of a decrease in the incidence of rape during the evening hours, as well.

The authors do provide an estimate of the economic benefit of this reduction in crime, and they peg it at several billion dollars per year. They're economists, after all, so I guess they feel obligated.

But forget that. The DST haters will just come up with some reason why making kids wait for the school bus in the dark costs several billion dollars. Nobody will ever win this game. Instead, just focus on the crime. Everybody wants less crime, and the anti-DST forces are never going to come up with an answer to this. What kind of crime could possibly go up because of daylight savings time? White-collar theft?

So we win! Assuming "we" are all the righteous lovers of year-round DST. More daylight savings time, less crime. It's a winner.

A Defense of Becky Quick

| Sat Oct. 31, 2015 1:04 PM EDT

CNBC's Becky Quick has come in for some criticism for being unprepared during Wednesday's debate. To refresh your memory, here's what happened during an exchange with Donald Trump:

QUICK: You had talked a little bit about Marco Rubio. I think you called him "Mark Zuckerberg's personal senator" because he was in favor of the H1B.

TRUMP: I never said that. I never said that.

....QUICK: My apologies. I'm sorry.

In fact, Trump had said that in his own immigration plan. Why didn't Quick know this?

I think we all know what happened here. Someone on Quick's staff prepared some notes that included the quote, but didn't specify where it came from. So when Trump denied saying it, Quick was stuck.

Now, sure, the staffwork here was bad, and Quick should have been better prepared. But that's not the real problem here. The real problem is that Quick was unprepared for bald-faced lying. She expected Trump to spin or tap dance or try to explain away what he said. She didn't expect him to just flatly deny ever saying it. That's the only circumstance that would require her to know exactly where the quote came from.

This was a real epidemic on Wednesday night. Candidates have apparently figured out that they don't need to tap dance. They can just baldly lie. Trump did it. Rubio did it. Carson did it. Fiorina did it. They know that time is short and they probably won't get called on it. The worst that will happen is that fact checkers will correct them in the morning, but only a tiny fraction of the viewing audience will ever see it. So what's the downside of lying?

Future moderators are going to have to be aware of this sea change. Modern candidates understand that they don't need to bother with spin and exaggeration any more. They can just lie, and etiquette limits how much debate moderators can push back. I don't think debate etiquette is going to change, so this probably means that moderators are going to have to learn to ask questions a little differently. We live in a new era.

Friday Cat Blogging - 30 October 2015

| Fri Oct. 30, 2015 1:50 PM EDT

Hopper has been hogging the catblogging show lately, so today you get a double dose of her brother: Hilbert and his shadow. That shadow looks very Halloween-y, doesn't it? Of course, that means lots of firecrackers tomorrow, which probably means lots of time spent hiding under the bed. On the bright side, we also set our clocks back, so everyone gets to sleep in an extra hour to make up for it. That sounds like a pretty good trade to me. I'm not sure what the cats think of it.