Did Aetna pull back from the Obamacare market because they were losing money? Or was it payback for the Obama administration's refusal to approve their merger with Humana? Well, they were losing money. But in a letter to the Department of Justice last month, they made a pretty explicit threat: they would have "no choice" but to cut back their Obamacare participation if they were unable to take advantage of the "synergies" of the merger:

This comes from Jonathan Cohn, who obtained a copy of the letter. Full details here.

Real Americans Hate Obamacare

Paul Gordon is an Arizona doctor who decided to bicycle across America and chat with ordinary folks about Obamacare. It wasn't pretty:

The outpouring of resentment and apparent lack of empathy disturbed Gordon at first. “Not a lot of generosity of spirit,” he noted glumly over the phone early in his trip.

....In Pennsylvania, a restaurant owner complained about her rising insurance bills and told Gordon she was sick of her insurance payments covering other people’s medical care.

In a small cafe in western Minnesota, a 64-year-old woman accused the law of spawning widespread abuse. “Obamacare encourages people to take advantage of the system,” she told Gordon.

Outside a convenience store in eastern South Dakota, another woman said — somewhat ashamedly — that everyone in town thought Obamacare and Obama were terrible. “He just gives all the taxpayers’ money away to poor people,” she said.

“I thought, ‘Oh, my God, how did we get here?’” a dispirited Gordon told me as he struggled to decipher the anger.

I don't really have any comment to share about this. It's just kind of sad. Gordon, however, is a remarkable guy who can apparently see lemonade everywhere he looks:

“I actually feel inspired,” he said at one point....Physicians have been reluctant to talk to patients about the healthcare system....But, he reasoned, physicians could do far more to guide their patients through the system and explain how it works. Armed with better information, perhaps Americans would base their opinions about health policy on more than the kind of emotional responses he heard across the country.

“We, as doctors, need to help people understand,” he said.

Good luck to him. Unfortunately, I have a feeling that all this resentment and anger isn't based on ignorance of risk pools, medical cost ratios, and young invincibles. Better information isn't likely to make much of a dent in this.

I've never seen Morning Joe. It comes on at 3 am here on the West Coast, and that's a no-go time slot. This has probably warped my view of politics, since Washington DC really does seem to set its collective watch by what Joe and Mika say each morning. To me, though, they're just occasional ghosts that I see on YouTube clips.

Anyway, a friend writes to tell me that the topic of conversation today was the possibility of Donald Trump dropping out of the race before things get too humiliating for him. I've never really bought this, though I know plenty of people who think it's a live possibility. And if it's a topic on Morning Joe, I guess that mean it's entered the mainstream. Here is my friend's take:

One of the guests speculated that if the polling continued to be bad, Trump would likely try to find some way to get out that would allow him to claim some sort of victory. This makes sense because it's very typical of deal jockeys like Trump. They will always negotiate for the best deal they can get and claim victory with the whatever they end up with—and when an investment starts to go south, they will look for an out that gives them something for their pride even if they take a loss.

What they are not, however, are turnaround artists. Turnaround people are different types of investors that tend to get into the weeds with a company, build it up and then sell it for a profit. They cheerlead management, focus on boosting morale, improving PR, etc. These are often private equity/venture capital people.

Trump has never shown himself to be a turnaround guy. If the negative polling seems to stick over the next few weeks, it wouldn't surprise me if a creative reason for Trump to extricate himself surfaces. For example, I could see him decide to switch to a third party run on a write-in campaign (blaming the #NeverTrumpers, RNC dissenters, media, etc.). He won't win, but he could say he ran through the election but was ultimately betrayed by the Republican elites. Whoever ends up in the hot seat for the Republican nomination would then get the "historic loss" tag and Trump could say if the elites had stuck with him, he would have done better.

I dunno. No matter how Trump sells it, this kind of thing just seems too obvious. No one would buy it. At this point, the only way he could get out and retain even a shred of credibility would be to fake a heart attack. Remember, Donald: the symptoms should be on your left side. I know you're not into details like that, but don't blow it.

Here's How Driverless Cars Will Happen

Ford says it will have a fully driverless car by 2021:

Ford Motor Co. plans to release a fully driverless car without a steering wheel or pedals in the next five years, the latest salvo in a technological arms race engulfing the global auto industry. The Dearborn, Mich., auto maker on Tuesday said it would initially target ride-sharing fleets and package-delivery services with the unnamed model, underscoring the still-incremental approach many car companies are taking before offering vehicles to consumers that don’t require humans behind the wheel.

Ford expects the first of its driverless cars to be used by commercial-fleet operators looking to cut the costs of employing human drivers, company executives said. The vehicles largely will be confined to cities with pre-mapped zones designed for autonomous vehicles.

This is exactly how we should expect driverless cars to evolve. Here's how one eminent expert described it several years ago:

Take driverless cars. My newspaper is delivered every day by a human being. But because humans are fallible, sometimes I don't get a paper, or I get the wrong one. This would be a terrific task for a driverless car in its early stages of development. There are no passengers to worry about. The route is fixed. Delivery is mostly done in the early morning, when traffic is light. And the car's abundance of mapping and GPS data would ensure that it always knows which house is which.

The next step might be passenger vehicles on fixed routes, like airport shuttles. Then long-haul trucks. Then buses and taxis. There are 2.5 million workers who drive trucks, buses, and taxis for a living, and there's a good chance that, one by one, all of them will be displaced by driverless vehicles within the next decade or two.

Oh, shucks, that was me. And it was pretty obvious, so I hardly get any brownie points for it. Technology never goes from zero to finished in a single step.

By 2020 or so, we'll have fully autonomous cars but with limited capabilities. They'll do only specific things (delivering packages, delivering newspapers) or operate only in specific areas. Then the limits will be incrementally removed. Remove the area limitation but keep the fixed routes and you have long-haul trucking. Remove the fixed routes but keep the area limitation and you have taxis. Eventually you remove all the limitations, and you have driverless cars. That's probably around 2025 or so. Your glorious future awaits.

Bad News for Obamacare: Aetna Pulls Back

Here's some bad news for Obamacare:

Aetna is dropping Obamacare insurance in 69% of the counties and 11 of 15 states where it currently offers plans....The insurer blamed heavy losses for the move. In doing so, the company suggested that too many sick people are buying plans, not enough healthy people are paying premiums to make up for it and the government isn't making policy changes to fix it.

Unlike the earlier pullback by United Healthcare, which wasn't that big a deal, this is. Aetna did a lot of business on the Obamacare exchanges, and until recently claimed that it was a good investment. Now they've suddenly changed their mind. Why? No one can say for sure, but the skeptical among us suspect it's payback. The Obama administration blocked their proposed merger with Humana, so now they're going to exit Obamacare. Nyah nyah nyah.

Maybe. It's unlikely we'll ever find out. After all, Aetna has been losing a lot of money on the exchanges, so it could have been nothing more than a simple business decision. So what does it mean?

In the short term, it means more people will find themselves with only one choice for health coverage. In the longer term, it means that premiums are going to rise. Insurers massively underpriced their Obamacare coverage when the exchanges opened up in 2013, in an online version of the price wars we used to see between gas stations on opposite corners of the street. Eventually, as in any competitive market, this is unsustainable. Either prices go up, or inefficient producers drop out, or both. In this case, the answer is almost certainly both. Some insurers are dropping out, and Charles Gaba estimates that premiums are going to see a big upward bump next year, maybe in the range of 15-20 percent.

I've mentioned before that Obamacare premiums are still way under the original CBO estimates. The difference in 2016 was about $1,000. If I had to guess, I'd say insurers need to make up about half of that before the market stabilizes. An increase of 20-25 percent would just about do it, and I figure that's likely to take a couple of years. At that point we might see some insurers get back into the market.

This is messy, but it's the way markets work. A public option might have helped to smooth out this process—or it might have wiped out the private insurers completely. There's no way of knowing, since the devil is in the implementation details. In the meantime, we probably have a couple of years of health care rate hikes ahead of us. This won't affect low-income families too much, since subsidies will make up the difference, but it will definitely have an effect on middle-class families who have to pay market rates with little or no subsidy. Stay tuned.

Since we're speaking of sexist bullshit, here's some real sexist bullshit:

Roger Ailes, the former Fox News chairman ousted last month over charges of sexual harassment, is advising Donald J. Trump as he begins to prepare for the all-important presidential debates this fall.

Mr. Ailes is aiding Mr. Trump’s team as it turns its attention to the first debate with Hillary Clinton, the Democratic nominee, on Sept. 26 on Long Island, according to three people briefed on the move, who insisted on anonymity because they were not authorized to discuss the matter.

Two of them said that Mr. Ailes’s role could extend beyond the debates, which Mr. Trump’s advisers see as crucial to vaulting him back into strong contention for the presidency after a series of self-inflicted wounds that have eroded his standing in public opinion polls.

I know, I know, it's Donald Trump. His dedication to sleaze is off the charts. But seriously, Roger Ailes? After reading about the stuff he did at Fox News for 20 full years, he ought to be shunned from polite society for the rest of his miserable life. Instead, Trump is hiring him as his media coach. Jesus.

For some reason, there's been a remarkable online effort to paint the Rio Olympics as a bottomless pit of sexist drivel. The evidence in favor of this is thin to the point of nonexistence, and today it reached comical proportions. Here is Emily Crockett at Vox:

It’s no wonder that this unfortunate Olympics headline, from the Colorado paper the Greeley Tribune, caught fire on social media this week. It seemed to be the perfect encapsulation of exactly how the coverage of this year’s games is going when it comes to women — and the way women are treated in society more generally:

Seriously? Our latest outrage is a headline at the Greeley Tribune, circulation 25,000? Given Phelps' fame and his quest for six gold medals—along with the fact that Ledecky was breaking her own world record (for the fourth time), making it barely even news that she won—you could argue that the Tribune made the right call. But even if it didn't, who cares? One small newspaper in one small town wrote one headline that was perhaps slightly misconceived. That's what's generating outrage today?

It's the internet that's made this kind of thing possible. If you dedicate yourself to trawling every bit of media in existence for arguably sexist coverage, you're going to find something every day. When you have literally millions of items to choose from, it's inevitable. But it's also essentially meaningless. What's actually remarkable is that the folks desperately looking for sexist coverage have found so little.

I've been watching the Olympics every night, and what I've seen is extensive and highly respectful coverage of women. Women are everywhere, they're getting at least as much attention as men, and the announcers have all been treating them as the tremendous athletes they are. But it's true that if you try hard enough, you'll find occasional brief bits of sexism here and there. And you can then turn these brief bits into yet another internet outrage campaign. And then, a few months later, you'll wonder why most people don't take charges of sexism as seriously as they should. It's a mystery, all right.

The Washington Post practically runs out of room this morning fact-checking Donald Trump's big foreign policy speech on Monday. I didn't listen to the speech, but it sounds like there was barely any room between the lies for him to have said anything that was true.

What's remarkable about Trump's Middle East position is that he doesn't just exaggerate or cherry-pick; he flatly turns things 180 degrees. He supported the Iraq War in 2002-03. He favored a quick withdrawal in 2007. He supported the Libya war. He opposed getting involved in Syria. These are all the things he says have contributed to the rise of ISIS and the destabilization of the Middle East.

In other words, by his own admission, everything he would have done as president would have been a disaster. Except that he doesn't admit it. He just lies about what his positions were. It's an amazing performance.

I asked earlier for data about the racial attitudes of the white working class. There's no foolproof way of determining this, but Phil Klinkner passes along the "racial resentment" scores of white working-class men from the American National Election Studies. This is on a scale of 0-16:

There are a few obvious things to take away from this:

  • Racial resentment scores haven't changed at all over the past 30 years.
  • White men with only a high school education score exactly the same as white men overall.
  • But white men with low incomes score a little higher.

If I were to draw any conclusions from this, I'd choose these two:

  • Donald Trump is probably not drawing on anything new in the racial resentment department. He's being louder and more obvious about it, but the pool of white racial resentment he's working with just hasn't changed much.1
  • It's low-income whites who score higher than whites overall, not those with low education. This suggests that economic status plays a (small) role in exacerbating racial resentment and that economic anxiety probably does play a (small) part in Donald Trump's appeal to blue-collar whites.

This is just one bit of data, and I wouldn't take too much from it. If I come across anything else that tells a different or more detailed story, I'll pass it along.

1Sure, maybe it's changed in just the past four years. I wouldn't put a lot of money on that, though.

Back during convention season I warned that election polls wouldn't really mean much until the middle of August. Well, the middle of August is here! So what are the polls showing us? Here you go:

Hillary Clinton is ahead by a steady 8 points. State polls show that she's ahead in pretty much every battleground state. If this holds up, it would be an epic blowout.

Of course it might not hold up. Then again, it might get even worse for Trump. He could turn out to be worst natural politician since—who? I'm not sure. We've never seen anything like this in an election against a party that's already served two terms and is running on a mediocre economy. Previous blowouts—FDR in 1936, LBJ in 1964, Nixon in 1972, Reagan in 1984—have all been by one-term incumbents running for reelection during years of strong economic growth.

Trump is a man of extremes: the biggest, the richest, the boldest, the most beautiful. Now he's heading for another title: worst presidential candidate of all time. That's quite an achievement.