Credit default swaps are in the news again:

An unidentified market participant has asked a committee of the International Swaps and Derivatives Association to rule on whether the passage of legislation approving collective-action clauses for Greek debt should trigger payouts on credit-default swaps tied to Greek sovereign bonds.

At stake are payouts from sellers of a net $3.2 billion of CDS on Greece currently outstanding, and the stigma associated with lending credence to an instrument policy makers have long reviled.

I hope the ISDA takes the case, and I hope they rule in favor of the CDS holders. I'm not a big fan of CDS, and I suspect the world would be a better place if CDS were banned outright, but for now they're legitimate contracts bought and sold in a legitimate way. So if Greece has defaulted, the contracts should pay out — and Greece has defaulted. The European claim that the haircut on Greek bonds is "voluntary" is the worst kind of sophistry, and allowing it to stand because of bullying from the EU would be a travesty. The ISDA shouldn't be a party to this fiction, and shouldn't encourage other governments to expect a continuing supply of get-out-of-jail-free cards in the future. That's moral hazard for you.

Default is part of the latest European deal. Part of the price of that deal is the cost of CDS payouts. Everybody should stop pretending otherwise.

Ten years ago John Judis and Ruy Teixeira wrote The Emerging Democratic Majority, which argued that a variety of demographic trends spelled doom for the Republican Party. Unfortunately for Judis and Teixeira, Republicans ignored their demographic doom and won a convincing victory in 2004. But hey, that was due to 9/11 and Iraq and the war on terror, and who could have predicted that? Then Democrats chalked up big wins in 2006 and 2008 (whew!), but in 2010 Republicans came roaring back. But hey, that was because of an epic recession, and who could have predicted that? Any day now, those demographics are going to kick in and Republicans will be doomed once and for all. Honest.

I am, obviously, being a smart-ass about this. In fact, as Jon Chait writes today in "2012 or Never," the demographic trends that Judis and Teixeira wrote about really are continuing apace. Smart Republicans are well aware of this, and they're especially well aware that one of the biggest demographic trends working against them is the growth of the Latino population. So a few years ago, as a way of peeling off some Latino votes from the Democrats, they took a stab at passing a moderate immigration bill. Unfortunately, their base went into a full-bore revolt and began demanding a harsher anti-immigrant policy instead of a more moderate one. As Jon says, this was about like publicly announcing an electoral suicide pact on national TV.

And it gets worse. At the same time that Republicans are deliberately adopting policies that spell long-term disaster, they've also adopted an uncompromising all-or-nothing political strategy that appeals to their existing base but has cost them dearly in the form of short-term Democratic victories. A more moderate party could have stopped or watered down health care reform, but instead they got Obamacare. A more moderate party could have struck a historic spending deal with Obama, but instead they got nothing. And like lemmings going over a cliff, virtually all of them voted for Paul Ryan's budget roadmap, which was extremely unpopular with most voters. What's going on?

The way to make sense of that foolhardiness is that the party has decided to bet everything on its one "last chance."…Grim though the long-term demography may be, it became apparent to Republicans almost immediately after Obama took office that political fate had handed them an impossibly lucky opportunity. Democrats had come to power almost concurrently with the deepest economic crisis in 80 years, and Republicans quickly seized the tactical advantage, in an effort to leverage the crisis to rewrite their own political fortunes.

…During the last midterm elections, the strategy succeeded brilliantly…In the long run, though, the GOP has done nothing at all to rehabilitate its deep unpopularity with the public as a whole, and has only further poisoned its standing with Hispanics. But by forswearing compromise, it opened the door to a single shot. The Republicans have gained the House and stand poised to win control of the Senate. If they can claw out a presidential win and hold on to Congress, they will have a glorious two-year window to restore the America they knew and loved, to lock in transformational change, or at least to wrench the status quo so far rightward that it will take Democrats a generation to wrench it back. The cost of any foregone legislative compromises on health care or the deficit would be trivial compared to the enormous gains available to a party in control of all three federal branches.

Jon doesn't actually offer any evidence that this is what's motivating Republicans, and likewise, I can't really marshal much evidence that he's wrong. But I have a hard time buying this. If I'm reading him correctly, he's saying that Republicans know they're doomed, and they're deliberately adopting a catastrophic long-term strategy in the hopes that one last hurrah will be enough to keep America conservative even if they do lose every election for the next 20 years.

But this simply doesn't pass the human-nature test. I can't peer into the souls of Republicans, but I don't get any sense that they believe themselves to be doomed. People just don't think that way. Rather, I get the sense that they're true believers who think that, deep in its heart, America agrees with them.

This also doesn't pass the common sense test. Even if Republicans do win control of all three branches, they aren't going to win 60 seats in the Senate. They aren't even going to come close. So if they try to roll back the New Deal, or whatever their plan is, Democrats will filibuster it. Republicans have already shown them how, after all. The GOP will certainly be able to move the dial a bit if they win in November, but there's no way anyone in the party thinks they can "lock in transformational change" over a two-year period with 52 votes in the Senate.

Basically, I just don't think there's a huge mystery to be solved here. When Democrats lost to Reagan, they nominated first Walter Mondale and then Michael Dukakis before finally tacking to the center and putting Bill Clinton in the White House. That was a 12-year stretch. Britain's Labour Party spent a decade moving left before they finally tacked back to the center after losing to Margaret Thatcher. It took them 18 years to finally regain power. Republicans have only been in the wilderness for either four or six years, depending on how you count. If it takes until 2016 for them to come to their senses, that would be a pretty normal progression.

Republicans don't think they have one last chance before the fat lady sings them off the stage. They're just reacting emotionally to a big defeat by convincing themselves that they were rejected because they hadn't been true enough to their principles. That happens all the time. They'll come around eventually.

I wasn't planning to revisit the creditmongering post I wrote earlier today, since I suspect that only a tiny fraction of my readership cares very much about it. But I've gotten a few responses to it that seem worth addressing, in particular this one from Aaron Carroll. So.....

When should you credit other people in your writing? For starters, I'd draw a sharp distinction between journalism, blogging, and academia. For lack of a better way of putting this, I'd also draw a sharp distinction between ideas and IDEAS.

Journalism first. I stick by my belief that being first with a garden-variety story by a few minutes or a few hours simply isn't worth crediting. The person who got there first thinks it's a big deal, but honestly, no one else does. Besides, journalism is a business. No one credits their competitors in other industries if they can help it, and I'm not sure why we expect journalists to be any different. So I guess my rule here is: If someone else breaks a genuinely big story, it's right and proper to credit them. If it's just a few-hour lead on a piece of commodity news, get a life. The warm glow of being first is all you're going to get out of it.

Next, blogging. After giving this some thought, I realized that I do follow some rough rules on linking and crediting. I've just never put them in writing. So here they are:

  • If I'm responding directly to someone, of course I link to them.
  • Even if I don't respond directly to someone, but only to a piece they linked to, I'll probably provide a link if they said something interesting.
  • If someone links to a common story that I would have seen anyway, I don't.
  • If someone links to a story I probably wouldn't have seen on my own, I usually give credit one way or another.
  • If the link comes from a link roundup, I'm less likely to bother giving credit. If my readers click through, I'm wasting their time.

Next, academia. This is a whole different culture with its own rules. Extensive endnotes are common. Literature reviews are customary. Credit to others is splashed all over the place not only because it's expected, but because it demonstrates a certain level of erudition on the part of the writer. Nothing else I've said here applies to academics.

Beyond that, though, several people have suggested that if you get an idea from someone, you should credit them regardless of any other linking/credit rules you might follow. This is where I'd make the distinction between ideas and IDEAS. The former is inspiration: if I read something that makes me want to dig into the plight of the long-term unemployed, I'm not likely to credit anyone. It's just a topic. Lots of people have addressed it, and the fact that I happened to get my inspiration from one person rather than another probably doesn't matter much.

But an IDEA is different: this is a very specific theory or model or explanation for something. Or maybe an original insight. If you mention an IDEA, or riff on it to produce one of your own, you should credit the originator.

One more thing. I think every blogger has had the experience of writing something, and then seeing someone else write something suspiciously similar a few hours later without giving credit. Be careful. I suspect that most of the time we're getting worked up over a coincidence. Most of our ideas aren't really as original as we think.

But that might just be my temperament speaking. I tend not to care much if I get credit for my ideas. Mainly, I just like to see them spread. If someone echoes me, then my ideas get broadcast into the ideasphere — and, truthfully, it's probably more effective if it looks like someone has independently had the same thought than it is if they're writing a post explicitly agreeing with me. So I'm happy either way. But I recognize that other people have different feelings about this and get a bigger kick than I do out of being the center of a new meme. So I guess maybe the overriding rule for credit is this: it doesn't cost anything and it can't hurt. If in doubt, give credit.

Ellen Nakashima of the Washington Post reports that the NSA and the White House are at odds over a proposal to increase surveillance of "critical infrastructure systems" in order to prevent cyberattacks:

The most contentious issue was a legislative proposal last year that would have required hundreds of companies that provide critical services such as electricity generation to allow their Internet traffic be continuously scanned using computer threat data provided by the spy agency. The companies would have been expected to turn over evidence of potential cyberattacks to the government.

....The NSA proposal, called Tranche 2, sparked fierce debate within the administration. It would have required an estimated 300 to 500 firms with a role in critical infrastructure systems to allow their Internet carrier or some other private company to scan their computer networks for malicious software using government threat data....NSA officials say this process would have been automated, preventing intrusion into the personal privacy of ordinary users visiting Web sites or exchanging electronic messages with friends.

....But the White House and other agencies, including the departments of Justice and Commerce, said the proposal left open the possibility that the large Internet carriers themselves could be designated critical entities. This, they said, could have allowed scanning of virtually all Internet traffic for cyberthreats on behalf of the government, opening a newly extensive window into American behavior online.

The story leaves it unclear whether Tranche 2 is dead for good, or merely needs to be retooled to place clear limits on who's required to take part. Either way, given the intense interest in cybersecurity these days, I don't expect this proposal to go away.

On a political note, it's unclear how this will break down on party lines. Obviously the GOP base is inclined to think that anything Obama opposes must be good, and they certainly supported the increased surveillance powers that George Bush gave to NSA. On the other hand, tea partiers tend to be suspcious of this kind of Big Brotherish monitoring. So it's hard to say which way they'll jump. Probably against Obama is my guess.

A few days ago, MG Siegler unleashed an epic rant about the Wall Street Journal failing to give him proper credit for a piece he wrote. Here's a taste:

I broke the news that Apple acquired the app search/discovery platform Chomp at 4:01 PM today. At 6:06 PM — over two hours later — WSJ reported the story as well. But oddly, with no mention of my original story.

This was odd both because, again, I reported the same information two hours earlier. And because it was at the top of Techmeme, which everyone in the industry reads. And every single other publication linked to my story.

[Blah blah blah]

Spare me. If you report out a big story that no one else was working on, then credit is due when others follow up your trail. But guess what? If you report a simple fact and happen to get it two hours before the rest of the world, no one cares. Journalists continue to be unhealthily obsessed by whether they reported a piece of news 15 minutes before every other news outlet in the world, but no one else is. And that's doubly true when it's a minor piece of commodity news. Does Siegler seriously think that everyone who reports on the Chomp acquisition for the next month should give him mad props for being the first by a couple of hours? Get over yourself.

I didn't bother ranting back about this at the time, but Felix Salmon reminded me of it today, and he comes to roughly the same conclusion in much more measured tones and a couple thousand more words:

As for crediting the news organization which broke some piece of news, that’s more of a journalistic convention than a necessary service to readers. It’s important enough within the journalism world, at least in the US, that it’s probably a good idea to do it when you can. But most of the time it’s pretty inside-baseball stuff. And in the pantheon of journalistic sins, failing to do it is not a particularly big deal. What’s much more important is that your reader get as much information as possible, as efficiently as possible. Which means that if you’re writing about a document or report, you link to that document or report. Failure to do that is a much greater sin than failure to link to some other journalist.

So while sometimes the failure to link is unavoidable, I look forward to a time when journalists face much more criticism for not linking to primary documents than they do for not linking to some other news organization which got the news first.

Yep. Always link to primary sources if you can. Give credit for major stories. But commodity news? I guess Felix is right to say that it's "friendly and polite" to link to whoever put it up first, but I think that's about it. If you don't do it, it's no big deal.

POSTSCRIPT: I should mention that I'm probably an outlier on this issue at Mother Jones. Writers at smallish publications routinely get annoyed when big news outlets follow up on something they wrote but don't give any credit. I understand the annoyance if the big pub basically does nothing more than rewrite the original story, but not so much if they add their own original reporting. Ideas don't belong to anyone, and readers don't much care where the inspiration for a story came from. Once it's out there, it's out there.

Rick Santorum has been on a populist tear lately, a job made easier by running against the endlessly awkward Mitt Romney. But President Obama is his main target, and as we all know by now, he said this on Saturday:

Not all folks are gifted in the same way. Some people have incredible gifts with their hands. Some people have incredible gifts and ... want to work out there making things. President Obama once said he wants everybody in America to go to college. What a snob.

Set aside for a moment the fact that this isn't true. Obama, in fact, wants everyone to go to a university, a community college, a technical school, or a trade school. But the audience listening to Santorum didn't know that, and Dave Weigel reports that they're totally on Santorum's side:

Here in northern Michigan, I've found that Republican voters are 1) aware of the "controversy" and 2) totally sympatico. "I totally agree with Santorum," said Larry Copley, a retired state cop waiting for the candidate at the Streeter Center here. "College isn't for everyone."

"We see a lot of jobs going unfilled because people [aren't] being trained for them," chimed in Larry's wife, Margo. "Plumbing, construction, jobs like that."

I don't think it's hard to understand the sentiment here. Half a century ago, it's true that the working class didn't have a widespread disdain for college. In fact, it was common to hope for a better life for your kids, with college as the ticket out of the factory/coal mines/construction site. But it's also true that no one felt it was mandatory. It was something to aspire to, but if your kids weren't college material, there were plenty of other good jobs available to them. No one suggested that a kid without a degree was a loser.

But things are different today. If you're in the working class, college isn't something to aspire to because your kids probably aren't going to college. Universities are mostly the preserve of the middle class and above, and everyone in the lower half of the income spectrum knows it. And those good jobs available to high school grads? There's not so many of those anymore. And to top it all off, these days there really is a steady drumbeat from the Tom Friedmans of the world suggesting that America is doomed to be a global loser unless we all start upping our game and cranking out a lot more PhDs and college graduates. Obama himself may not be saying that explicitly, but he's part of an elite consensus that sure is. It's hardly any wonder that the working class feels besieged on all fronts lately.

The fact that Santorum is turning this into an attack on Obama is just campaign politics. No big deal, really. But the sentiment he's expressing here is real, and it's one we've heard more often from the left than the right in the past. Needless to say, I could do without Santorum's loopy stuff about Obama supporting college because it destroys religious faith (also not true, by the way), but the alienation and stagnation of the working class is real, and frankly, it's nice to hear someone on the right acknowledge this in an economic sense, not just the usual culture war sense. We could use more of this.

Check out this campaign dispatch from LA Times reporter Paul West:

"I don't come from the elite. My grandfather was a coal miner. I grew up in public housing on a VA grounds. I worked my way to the success that I had, and I'm proud of it," Santorum said Saturday in Troy, before a working-class audience gathered in the county where Romney enjoyed a privileged upbringing. Santorum didn't elaborate, but his family wasn't poor; his father, a psychologist, and his mother, a nurse, worked for the Veterans Administration — now the Department of Veterans Affairs — which provided them with an apartment.

....Santorum's latest campaign ad attacks Romney for "turning his back on Michigan workers" without mentioning that Santorum also opposed the auto industry bailout.

How about that? A campaign story that actually fact checks a candidate's statements in real time. Good work!

The rest of the story is mainly about the gobsmacking way in which a Republican primary race has pretty much turned into the class warfare they all claim to loathe so much when Democrats do it. My grandfather was a coal miner! The other guy makes a lot of money! College is for snobs! And of course, Romney is helping Santorum's cause by pandering for the NASCAR vote and then admitting he doesn't really care much about the sport but "I have some great friends who are NASCAR team owners." It's an edifying spectacle.

Matt Yglesias doesn't understand the widespread dislike of jury duty:

I struggle to understand America's disdain for jury duty. I've been called twice, and both times was happy to go. All things considered, I'd much rather do my regular job day-in and day-out that do jury duty, but I do my regular job every day. I find that taking a day or two or three off every few years to go do something different is pretty fun.

....Is everyone else's job really so amazing that they can't bear the thought of a few days off to listen to testimony and pronounce on a verdict? I don't buy it. I feel like as a society we've coordinated on a pointless anti-social norm that you're some kind of sucker if you're willing to just smile and do what the judge wants even though there are no really good self-interested reasons to want out. For salaried professionals, jury duty is a paid vacation. What's not to like?

In the past, one legitimate beef was the way jury duty was run: calling in for days at a time over the course of a month, never knowing if you could make plans or if you'd get called in. Here in my neck of the woods things are now much better: you call in once, or at most three or four days in a row, and you're either called in or not. That's not nearly so bad.

Beyond that, there's the problem of long trials. Getting called into muni court isn't so bad. Trials rarely last more than a few days. Superior court is a different story. These are bigger cases, with trials lasting weeks at a time. That can be a real grind, and on the occasions I've been called downtown I usually do whatever I can to avoid getting called for a case.

What else? It's pretty boring. For someone like me, it's really tedious stuff waiting around, then waiting around some more while the lawyers play their voir dire games, then sitting around while they present their endless cases. I suppose the lawyers in my audience will disagree, but to a lot of us these trials seem like they should take about three or four hours, not three or four days (or weeks). And while trials are tedious in one direction for those of us with interesting jobs, I suspect they're tedious in a different direction for people who aren't used to sitting all day and thinking about evidence.

And of course, some people don't get paid for jury duty. That sucks. Plus the hours are inflexible, which might cause problems that your regular job doesn't. Or maybe you don't work at all, and jury duty means needing to scrounge up daycare that you don't normally need. Or maybe your job is one where the work will pile up and have to get done when you get back, which means facing a gigantic in-basket once the trial is over.

And speaking solely for myself, the one jury I've ever been on went a long way toward wrecking my faith in the criminal justice system. It was a case that shouldn't even have gone to trial, let alone sucked up four days of my time, the judge's time, and the bailiff's time. I suppose that's a lousy attitude, but I hated the idea that so many of us were having so much of our time wasted over a case that was only in court because some rich dude could afford a fancy lawyer to take a flier on weaseling out of a pretty obvious violation of the law.

Anything I've missed? Any reason I should love jury duty? You know where to tell me.

My take on the Oscars: 2011 was not a great year for movies. The Academy's decision to increase the number of Best Picture nominees from five to ten has never looked more pathetic. Especially since they could only come up with nine this year.

That said, I thought The Artist was clever, but ultimately little more than a bon bon. I'm hard-pressed to understand the lavish praise it got. Tree of Life was ambitious and had some sparks of brilliance, but in the end it didn't work. The Descendants was good; mainstream but good. However, it was a little too overtly manipulative for my taste. Midnight in Paris was a cute trifle, but just a trifle. Moneyball was very good, but just a little too ordinary to play in the big leagues. I didn't see The Help, War Horse, or Extremely Loud & Incredibly Close.

By process of elimination, that means my pick for Best Picture this year is.....Hugo. I didn't like all of Hugo, but I liked a lot of it, and if the Academy is going to give the big prize to a valentine to Hollywood, I'd pick Hugo over The Artist. Needless to say, I expect to be pretty disappointed this evening.

Did the Supreme Court decision in Citizens United produce the recent explosion of Super PACs and their flood of independent money from rich donors into the 2012 campaign? There's been a bit of a cottage industry lately claiming that this is a myth, followed by a bit of a counter-cottage industry insisting that it's true after all. In a nutshell, the mythbusters claim (correctly) that Citizens United affected only the ability of corporations and unions to make independent campaign expenditures, but most of the money flowing into Super PACs has comes from private individuals, who have been able to spend unlimited sums for years. The counterclaim is that Citizens United really did unleash expenditures from individuals, but did it indirectly. Legally, the chain goes from Citizens United to SpeechNow, which was the case that removed all previous limitations on private expenditures. Andrew Sprung has a pretty good summary of the arguments here.

So which is it? In the end, I think the argument is inherently a little metaphysical. Remember 527s? Prior to Citizens United, rich people who wanted to spend lots of money on campaign ads either did it themselves or contributed to 527 groups. That's how the Swift Boat folks were organized, for example. But here's the thing: legally, 527s were allowed to raise money for "issue advocacy," but not to explicitly advocate for or against a federal candidate. This was, needless to say, a crock: 527s routinely ran ads that viciously attacked and supported candidates. They just stopped (barely) short of expressly saying, "On Tuesday, vote for John Doe."

So what impact have Super PACs had? On the one hand, you can argue that they really haven't changed anything on the ground. They run pretty much the same kinds of attack ads as the 527s used to, and the only change is that they don't have to worry about legal challenges anymore. On the other hand, you can argue that the added freedom is genuinely important. Being able to explicitly raise money for candidates, instead of pretending to be an issue advocacy group, makes a real difference.

So which is it? Obviously there's a bit of truth to both sides, and which argument you give the most weight to is mainly a matter of temperament and attitude. For myself, I think it's fair to say that Citizens United really did have an impact on individual expenditures, but probably didn't empower rich people quite as much as popular legend has it.

That said, there are also a couple of other points to make. First, Citizens United obviously did unleash spending by corporations and unions. In the 2010 election it seemed as though the impact of Citizens United on corporate spending had turned out to be a bit of a dud, but this year it looks as though it's finally taking off. Second, one of the commonest complaints about Super PACs is that they're allowed to hide the sources of their contributions. But this has nothing to do with Citizens United. It has to do with the legal requirements of 501(c)(4) groups, which have become major funding sources for Super PACs. The FEC has declined to force 501(c)(4)s to disclose their donors, and the IRS has declined to enforce the law that says they can't have electoral politics as their primary purpose. Both of these problems could be fixed tomorrow by legislative means if Congress wanted to. Rick Hasen has a pretty good summary of the current state of play here.

UPDATE: Fred Wertheimer of Democracy21 emails to point out that, in fact, Swift Boat Veterans for Truth was fined $300,000 by the FEC for violating campaign rules. Likewise, America Coming Together, which got substantial funding from George Soros, was fined $775,000.

These are fairly modest sums compared to the amounts raised (nearly $7 million for the Swift Boat group and $137 million for ACT). So again, you'll have to decide for yourself if these fines mean (a) 527 groups really did operate under meaningful legal constraints or (b) they were a joke and had no real impact.

Regardless, I had forgotten about these fines, and they do suggest that there was at least a little bit more oversight on the old 527 groups than I originally suggested.