Kevin Drum

Biggest Oil Spill in History?

| Fri May 14, 2010 1:47 AM EDT

Is it going to be possible to ever cap the Deepwater Horizon oil blowout? Maybe not, says National Geographic:

Such recovery operations have never been done before in the extreme deep-sea environment around the wellhead, noted Matthew Simmons, retired chair of the energy-industry investment banking firm Simmons & Company International....Slant drilling — a technique used to relieve pressure near the leak — is difficult at these depths, because the relief well has to tap into the original pipe, a tiny target at about 7 inches (18 centimeters) wide, Simmons noted.

"We don't have any idea how to stop this," Simmons said of the Gulf leak....If the oil can't be stopped, the underground reservoir may continue bleeding until it's dry, Simmons suggested.

And how much oil would that be? Via the New York Times:

BP’s chief executive, Tony Hayward, has estimated that the reservoir tapped by the out-of-control well holds at least 50 million barrels of oil.

That would be about 2 billion gallons of oil. If all of this floods out, it would be the biggest oil spill in history by a huge margin and 20 times bigger than the biggest previous spill in the Gulf of Mexico. From the National Geographic piece: "The 1979 Ixtoc oil spill, also in the Gulf of Mexico, took nine months to cap. During that time the well spewed 140 million gallons (530 million liters) of oil — and the Ixtoc well was only about 160 feet (49 meters) deep, noted retired energy investment banker Simmons."

Even if the well is capped, this is going to be a huge spill. The spill rate, originally estimated at 50,000 gallons a day and then 210,000 gallons a day, might actually be as much as a million gallons a day — or maybe even more. But it's hard to tell because BP is using chemical dispersants to send most of the oil to the bottom of the sea. This keeps it off the shore, but might end up doing more damage in the long run. Nobody seems to know for sure.

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More on the Organization Kid

| Thu May 13, 2010 7:46 PM EDT

James Joyner pushes back on my suggestion this morning that the whole "Organization Kid" meme is overblown:

It strikes me as highly probable that “Organization Kids” are much more highly represented in elite Washington than in society as a whole. Aside from nepotism, the way to get ahead in this town is to go to the right schools, punch the right tickets, and not piss too many people off.

....Post-Bork at least, every successful Supreme Court nominee has been a cipher who claimed to have no opinion on, well, anything. The less that’s known, the harder it is to mount an attack. That’s not a slam on the nominees but rather on the system.

Well....sure. But aside from nepotism, hasn't going to the right schools, punching the right tickets, and not pissing too many people off always been the way to get ahead in Washington? And in business? And in the military? And just about everywhere else? I'm just not sure that very much has really changed on this front recently.

As for Supreme Court nominees being ciphers, I don't think that's quite right either. Lots of them have past records. What is true is that confirmation hearings have become a joke in the post-Bork era, with nominees unanimously insisting that they can't testify about any case that might ever come before the court, which, since it's the Supreme Court we're talking about here, means pretty much every possible case. This is indeed a problem with the system, but it's not quite the same thing as nominees not usually having deep public records. In fact, most of them do, and Elena Kagan is a little unusual in this regard.

More generally, I think what's going on here is that I've always been a little skeptical of the kinds of cultural memes that David Brooks (and others) traffic in, and I've grown even more skeptical as time goes by. I understand completely where the "Organization Kid" thing comes from, for example, and my gut tells me there's something to it. But my gut tells me lots of things, and further reflection usually gives me pause. I don't think kids of my generation were quite the rebels we'd like to imagine we were, and in any case we've mostly grown up to become an awful lot like our parents and grandparents. Some of us are cautious, some of us are outspoken, and some of both kinds are running the world right now. Same as always. I think that turns out to be the case more often than not whenever kids of any generation are the subject. There are differences, but I've gotten to the point where I really, really want to see some solid evidence before I buy into whatever the latest theory/complaint/whine is.

Climate Change's Secret Weapon

| Thu May 13, 2010 6:09 PM EDT

Pretty much everyone agrees that it doesn't make a lot of sense to regulate greenhouse gases using the Clean Air Act. The mechanisms in the CAA just don't fit the problem very well. Still, it's better than nothing, and there's long been an implicit threat from the Obama administration that if Congress doesn't pass a climate bill then the EPA will step in and do the job for them. Today, they ratcheted up the pressure:

The Environmental Protection Agency announced Thursday it is finalizing a rule aimed at curbing greenhouse gas emissions from the largest emitters in the United States....The new rule will cover 67 percent of the greenhouse gas emissions from stationary sources such as power plants and oil refineries, EPA estimates, and in its first year will translate into 900 permits for both new sources and modifications to existing sources of global warming pollution.

The EPA's rule will apply to new sources that emit 100,000 tons of carbon dioxide per year and to existing sources that make changes that would increase their emissions by 75,000 tons per year. Brad Plumer explains what that means:

That standard will apply to only about 5501 big polluters in the entire country....Those plants will have to employ the best available control technology — although no one knows yet what that means. Becoming more efficient? Co-firing biomass? Switching to natural gas?

So a couple of things are happening here. One, it's now going to be very tough for new coal-fired power plants to get built in the United States. Given that those plants are a major source of carbon pollution, that's a significant step. Second, the EPA's clearly pressing ahead with its own regulations — and that might give the Senate the kick it needs to pass a climate bill. But the agency's also being cautious and moving very deliberately on this stuff—indeed, it's backing off from it's previously planned 25,000-ton threshold. No doubt Lisa Jackson's trying to avoid a hostile reception from senators like Lisa Murkowski, who has been insisting that EPA rules would throttle the economy and has threatened to pass a bill stripping the agency of its carbon authority. There's a fine line the EPA has to walk here.

This continues to be the big wild card on the climate front. By any ordinary measure, climate legislation looks to have a bleak future in Congress. It just flat doesn't have the votes. But if the Obama administration demonstrates that it's dead serious about letting the EPA dragon out of its lair — and so far it hasn't backed off — it's entirely possible that John Kerry and Joe Lieberman (and Lindsey Graham if he gets over his huff) might be able to scare a few Republican senators into viewing their climate bill as the lesser of two evils. I'm not sure if it's enough in an election year, but it's at least potentially a game changer.

1Wait a second, you say. Is it 900 new permits or 550 big polluters? Or does that end up being the same thing? Here's what the EPA itself says:

Under the new emissions thresholds for GHGs that begin in July 2011, EPA estimates approximately 900 additional permitting actions covering new sources and modifications to existing sources would be subject to review each year. In addition, 550 sources will need to obtain operating permits for the first time because of their GHG emissions.

I'm not sure exactly what this means. But it sounds to me like the 900 number applies to plants that are already covered by the CAA for other pollutants and will now need carbon dioxide permitting too, while the 450 number applies to plants that emit lots of carbon dioxide but haven't previously been covered by the CAA because they don't emit other pollutants. So the real number is 1,450 new permits for various sources. More later if I learn different.

Who Are the Long-Term Unemployed?

| Thu May 13, 2010 3:06 PM EDT

Why is the media paying less attention to unemployment today than it did in 1983? I ran down a bunch of possible reasons yesterday, and one of them was this: "Maybe it has something to do with the fact that today's stubbornly high numbers are concentrated among the long-term unemployed."

I wasn't quite sure what I had in mind when I wrote that, but the chart I included in yesterday's post showed that, in fact, short-term unemployment had peaked about a year ago and come down pretty sharply since then. Long-term unemployment, by contrast, just kept skyrocketing. Today, nearly 4.5% of the population has been unemployed for more than six months, nearly double the previous record set in 1983, and it shows no signs of flattening out. Perhaps, I thought, that segment of the population was somehow less visible, or less sympathetic, or less something that somehow translated into less media attention. Today, Catherine Rampell writes about this in the New York Times:

Unemployment numbers show a notable split in the labor pool, with most unemployed workers finding jobs after a relatively short period of time, but a sizable chunk of the labor force unable to find new work even after months or years of searching. This group — comprising generally older workers — has pulled up the average length of time that a current worker has been unemployed to a record high of 33 weeks as of April. The percentage of unemployed people who have been looking for jobs for more than six months is at 45.9 percent, the highest in at least six decades.

Italics mine. Rampell's story focuses on Cynthia Norton, 52, an administrative assistant in Jacksonville who's been unable to find work for the past two years because companies have been shedding clerical workers during the recession and then finding that they can get along fine without them even when the economy improves. So Norton is working as a Wal-Mart cashier and she's not happy about it:

Because of the Wal-Mart job, she has been ineligible for unemployment benefits, and she says she made too much money to qualify for food stamps or Medicaid last year. “If you’re not a minority, or not handicapped, or not a young parent, or not a veteran, or not in some other certain category, your hope of finding help and any hope of finding work out there is basically nil,” Ms. Norton says. “I know. I’ve looked.”

I'm not quite sure what conclusions to draw from this, but the recession's extreme effect on a small class of long-term unemployed seems like it deserves more attention than it usually gets. What's more, if that class is mostly 50-something workers, not 20-somethings, that's significant too. Politically, it might explain why tea party activism — which skews older — has taken off so strongly, and economically it might explain....what? I need to noodle on that. But there's something there.

David Brooks and the Organization Kids

| Thu May 13, 2010 1:29 PM EDT

I mostly like David Brooks just fine, but one of his most annoying habits is plucking individuals out of the news and then turning them into poster children for whatever cultural theory he's peddling at the moment. I suppose it's an occupational hazard for columnists. His latest stab at this was Tuesday's column in which Elena Kagan — smart, friendly, and scholarly, but also careful and pragmatic — became a symbol for the "profusion of Organization Kids at elite college campuses" that he's noticed lately. "They were not intellectual risk-takers," he lamented "They regarded professors as bosses to be pleased rather than authorities to be challenged. As one admissions director told me at the time, they were prudential rather than poetic."

Well, two can play at that game. If Organization Kids are taking over the country, then how do you explain Donald Berwick? He's Obama's choice to head the Centers for Medicare and Medicaid Services, and that puts him at ground zero for the healthcare rationing debate. But as Kate Pickert reports, Berwick has been anything but cautious and prudential on the topic:

Republicans are gearing up for what promises to be a very contentious hearing. Yesterday, Senate Minority Leader Mitch McConnell said on the Senate floor that Berwick is "an expert on rationing."....The reason? Berwick is, by all accounts, a huge fan of the National Health Service, Britain's single-payer health care system.

....As he says in the video above, Berwick believes health care is a human right and systems — like taxation — are a valid means to ensure everyone gets it. He believes the NHS successfully delivers care to the UK, although it could be better....Berwick believes there is a tremendous amount of waste in the U.S. health care system that can be reduced through government policies, beginning with Medicare reform.

....It should also be noted that Berwick, who works at Harvard Medical School, is widely respected in the health policy community. His stance that money can be saved and patients better served by rewarding performance over quantity is shared by most top policy experts consulted by the Administration in the ramp up to the vote on health reform. A community disagrees with Berwick's methods for achieving this — including most Republicans and some health policy conservatives — but he is not a radical outlier. What he is is outspoken.

Berwick is outspoken! And he's an Obama nominee! And honestly, I doubt that it's just because he's older than Kagan. So maybe the Organization Kids aren't taking over Washington DC after all. Maybe, in fact, there are just lots of different kinds of people in the world, and Kagan is one kind while Berwick is another. And maybe that's OK.

The Future of Taiwan

| Thu May 13, 2010 12:25 PM EDT

Dan Drezner has finally met a free trade agreement he doesn't like. The treaty in question is one that would liberalize trade between China and Taiwan, and by itself that's fine:

The security ramifications are troubling, however. While China's economic leverage over the United States is limited, this kind of agreement would ratchet up the asymmetric dependence of Taiwan on the Chinese economy. Maybe Taiwan has already crossed the point of no return with regard to interdependence with the mainland — but this agreement would surely guarantee crossing that threshhold.

What would China do with this leverage? I don't know, I really don't. If Beijing plays the long game, they would allow for the build-up of political interest groups in Taiwan with a powerful incentive to appease the People's Republic in order to keep the economic relationship unruffled. The thing is, China has often been clumsy in its initial attempts to translate economic power into political influence, and I could easily see such a misstep occurring a few years from now.

Perhaps I'm being paranoid about this. The one thing I'm certain about, however, is that the most likely flashpoint for a great power confrontation between the United States and China is anything involving Taiwan. So I get veeeeeeerrrrrrry nervous about anything that upsets that particular apple cart.

The future of China and Taiwan is, obviously, impossible to project with even minimal clarity. But I've long thought that the most likely scenario starts with increased economic ties and then moves toward things like artfully worded mutual nonagression treaties, followed by limited formal diplomatic ties and then by a sort of shadow version of what Hong Kong is to mainland China today. Then, eventually, Taiwan and China are reunited. The whole process might take the better part of a century, and I figure that China can probably deal with that.

But a million things could go wrong in the meantime. And of course I might be entirely wrong about how this plays out. But if everyone stays calm, my guess is that things end with a whimper, not a bang.

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Today in Financial Reform

| Thu May 13, 2010 11:18 AM EDT

Ezra Klein lists the amendments to the Senate financial reform bill that are up for votes today, and you will be entirely unsurprised to learn that this is the one I'm most interested in:

Collins amendment to mandate minimum leverage and risk-based capital requirements for insured depository institutions, depository institution holding companies, and nonbank financial companies that the Council identifies for Board of Governors supervision and as subject to prudential standards. (#3879)

Leverage! Even the smallest move in the direction of mandating reasonable limits on leverage is more important than the biggest move in pretty much any other direction. The White House opposes legislative caps on leverage because they're busily negotiating international standards and don't want to have their hands tied. I say: tie their hands. It might, to coin a phrase, give them some additional leverage in these negotiations. And if the Basel III talks don't go well, at least we'll have some regulations of our own.

(But will banks all flee New York for friendlier climes if we have tough leverage regulations and other countries don't? This is sort of an all-purpose threat against every serious piece of financial regulation ever proposed, so I wouldn't pay too much attention to it. And Collins' amendment isn't exactly a killer: all it says is that the "appropriate" agencies shall establish minimum capital requirements, and those minimums "shall not be less than the generally applicable risk-based capital requirements....nor quantitatively lower than the generally applicable risk-based capital requirements that were in effect for insured depository institutions as of the date of enactment of this Act." There's a lot of leeway there.)

Elsewhere, Edmund Andrews argues that we should pay attention to the fight over federal pre-emption. The question is, should federal laws be a floor, with states allowed to set more stringent requirements if they want? Or should federal laws apply across the board?

To the banks, federal pre-emption is an absolute top priority. They’ll tell you it’s incredibly hard to deal with a patchwork of regulations in 50 states. (Just think of the unintended consequences!) But the real reason is they don’t want to have to lobby in 50 different states when they can focus all their lobbying in Washington. It’s true that some states were even worse than Washington about regulating banks, but one strong state attorney general often provides a template for all the others. Just think about the role of state AG’s in tobacco litigation. That’s what really scares banks.

This time, according to Andrews, it's mostly centrist Democrats who are fighting to weaken state rules. I'm actually sympathetic in general to the argument for nationwide rules when it comes to interstate commerce like banking, but I think Andrews is right: in the case of banking regulation, states can be the laboratories of democracy just as effectively as they can in other areas, and experimenting with tougher regs is probably a useful exercise. Let's not cut them off at the knees.

Is the Iraq Withdrawal Slowing Down?

| Thu May 13, 2010 1:26 AM EDT

We're supposed to be well on our way to getting out of Iraq, but the Guardian reports that the drawdown of American troops has hit a roadbump thanks to the continuing disarray following the March parliamentary elections:

The White House is likely to delay the withdrawal of the first large phase of combat troops from Iraq for at least a month after escalating bloodshed and political instability in the country. General Ray Odierno, the US commander, had been due to give the order within 60 days of the general election held in Iraq on 7 March, when the cross-sectarian candidate Ayad Allawi edged out the incumbent leader, Nouri al-Maliki.

....The withdrawal order is eagerly awaited by the 92,000 US troops still in Iraq — they mostly remain confined to their bases. This month Odierno was supposed to have ordered the pullout of 12,500, a figure that was meant to escalate every week between now and 31 August, when only 50,000 US troops are set to remain — all of them non-combat forces.

Hmmm. On the other hand, Reuters has this:

The Pentagon said on Tuesday the U.S. drawdown from Iraq was on schedule despite this week's deadly bombings and persistent political uncertainty.

The United States aims to withdraw 40,000 troops from Iraq over the next four months — a major logistical challenge which the Pentagon says will get under way in earnest in June.....Pentagon Press Secretary Geoff Morrell [] said he did not believe the pace of the withdrawal during the month of May had been altered because of recent events in Iraq. But he added the top U.S. commander in Iraq had some flexibility as long as the September 1 deadline was met.

So the May drawdown hasn't happened yet, but that doesn't mean the withdrawal is slowing down. There's still some "flexibility" here.

I don't know what this means. But it's worth keeping an eye on. I really do believe that everyone from Obama on down on our side and from Maliki on down on the Iraqi side wants the withdrawal to go ahead on schedule. But there are always reasons to delay things. Always. The only way we'll ever get out is to forge ahead regardless.

Religion and Death

| Wed May 12, 2010 9:12 PM EDT

Responding to my post yesterday about atheism, Andrew Sullivan asks me an unexpected question:

If I may intrude, and ask a question I do not mean to be loaded, just curious: I wonder what Kevin thinks happens to him when he dies? And how does he feel about that — not just emotionally but existentially? These questions can be addressed without talking of God. And yet they reveal something about what it is to be human.

The fact that I didn't expect this is telling in itself: this is, obviously, one of, if not the key question in most religious traditions. But I just don't think about it very often. Still, I'll take a crack at it.

To answer the first question: I don't think anything happens when I die. My best guess is that my consciousness/ego/soul simply ceases to exist.

And how do I feel about this? Well, obviously in some sense I fear death. We all do. I'd have a pretty strong reaction if my doctor told me I had a month to live. But aside from that purely primal response, does it bother me that my consciousness will eventually cease to exist forever? Not really.

I understand that this is a pretty unsatisfying answer. But it's not glib. It's just a plain description of what my interior life is like. I don't go through life like Woody Allen, thinking that human existence is an implacable existential horror. But neither does it bother me that my own existence won't last forever. It never has, not in childhood and not now. And I'm not sure why. It just doesn't.

For what it's worth, my instinct tells me that this is primarily an aspect of temperament you're born with. Either you have a strong emotional reaction to the idea of eventual nonexistence or you don't. If you do, religion is the most common way of dealing with it. The particular religion you choose is obviously mostly cultural, passed down from your parents and peers the same way you learn a particular language as a child, but the motivating fear itself probably isn't.

But either way, does this really reveal something essential about what it means to be human? In one sense, yes: a knowledge that someday we'll die is unique to humans (though fear of death plainly isn't), and our response to that knowledge has been a defining feature of human cultures for millennia. Still, there are hundreds of other things that are unique to humans too, and I don't think there's any special reason to give this one pride of place.

And one final footnote. Since Nietzsche keeps coming up in these discussions, keep this in mind: he may have had a healthy trepidation about what the world might be like if, indeed, God were truly dead, but a lot of time has passed since then and we pretty much know the answer now. In the land of Nietzsche's birth, less than half the population believes in God and less than a quarter can be called Christian in any but the most anthropological sense. Over the past half century Europe has become essentially a secular society, and it seems to be working out fine. I suppose you might argue that this is a fool's paradise, that they're subsisting off the dwindling religious capital of the past two thousand years, but that case gets harder and harder to make with every passing year. They've basically given up religion and nothing has happened. They still produce plenty of art and science, they live happy lives, their moral sense is intact, they haven't become nihilists, and they appear to love and cherish their families and friends just as much as they ever have. If Nietzsche were alive today, he'd probably consider the tradition of tragic atheism that he himself created to be rather quaint. Perhaps we should too.

The Truth About the Trust Fund

| Wed May 12, 2010 7:44 PM EDT

Veronique de Rugy hauls out a familiar argument today: we can't rely on Social Security's trust fund to keep it healthy for the next few decades.

In practice, [] the trust fund and interest payments it receives are simply accounting fiction. For years, the federal government has been borrowing the Social Security Trust Fund assets for its daily spending. The fund has nothing left in it except IOUs from the federal government. In fact, even the interest is paid in IOUs.

Hence, the only way Social Security will not go into the red this year and in future years is if the federal government pays back Social Security. But since the money has long ago been consumed, it must borrow money from the public or raise taxes to pay its Social Security debts.

It's true: from a purely fiscal point of view, the Social Security trust fund is a fiction. But while this is true as a bare fact, the implications of this argument are pernicious and need to be vigorously confronted whenever they rear their head in public. Here's why, in the simplest possible terms.

Back in 1983, we made a deal. The deal was this: for 30 years poor people would overpay their taxes, building up the trust fund and helping lower the taxes of the rich. For the next 30 years, rich people would overpay their taxes, drawing down the trust fund and helping lower the taxes of the poor.1

Well, the first 30 years are about up. And now the rich are complaining about the deal that Alan Greenspan cut back in 1983. As it happens, I agree that it was a bad deal. If it were up to me, I'd fund Social Security out of current taxes and leave it at that. But it doesn't matter. Once the deal is made, you can't stop halfway through and toss it out. The rich got their subsidy for 30 years, and soon it's going to be time to raise their taxes and use it to subsidize the poor. Any other option would be an unconscionable fraud.

1For a slightly more detailed version of this explanation, see here. Note that "poor" is actually shorthand for both the poor and the middle class, while "rich" actually means both the rich and the upper middle class. This distinction comes into play because payroll taxes, which have built up the trust fund for the past 30 years, are primarily paid by the poor and the middle class, while income taxes, which were kept artificially low over that same period and will soon need to raised in order to pay off the trust fund debt, are primarily paid by the rich and the upper middle class.