I thought tonight's debate was much closer than the last one. I didn't really see any clear winners or losers. Just in general, though:

Michele Bachmann struck me as more mechanical than last time. She was just too focused on being a fighter and not much else. But by overstressing that, she also highlighted the fact that she's been fighting fighting fighting and losing losing losing. That's not so good in a presidential candidate. If you're presidential timber, you're supposed to fight and win.

Romney was fine, I guess. No mistakes, but also nothing that really helped him. Still the front-runner until someone knocks him off his perch. Something tells me I'm going to be saying that a lot.

Pawlenty continued to be a little soporific, though he didn't make any big mistakes this time around. So in that sense it was an improvement over last time. But he still doesn't know how to credibly sound tough. And that joke about mowing Mitt Romney's lawn? Please. Frank Luntz apparently loved it, but I thought it seemed way too obviously prepped and staged. For that kind of thing to work, it has to sound spontaneous, and Pawlenty just doesn't seem to have the ability to sound spontaneous.

Santorum was way too whiny. Quit complaining about how much camera time you get!

Jon Huntsman didn't really distinguish himself, but also didn't pander as much as the rest of the field. I still maintain that he's running for 2016, not 1012.

Gingrich proved once again that he knows how to turn a phrase, but that's about it. He reeled off some good applause lines, including his faux outrage over gotcha questions, but honestly, he still doesn't look like he's treating the whole thing seriously. At the very least he could try standing up straight instead of slouching rakishly over the lectern.

Ron Paul, Herman Cain: give it up guys.

Standard caveat: I'm obviously not the target audience for these folks, so it hardly matters what I thought about them. Still, what's so striking about this group is that aside from Ron Paul there's hardly any real daylight between them. The questioners tried mightily to provoke some arguments, and they did manage to get a few small ones going over relative minutiae, but for the most part they're still just trying to out-tea party each other.

Nonstandard caveat: I had to go out to pick up a pizza partway through, so I didn't see the whole thing. I might have missed the best zingers and most substantive discussions of the night, for all I know.

Next: Rick Perry shakes things up! And when he does, I guess I'm going to have to explain further why I'm so sure that he can't win next year. Either that or I'll have to change my mind. I'll bet you can't wait to see which way I go.

So how is California's fabulous high-speed rail project between LA and San Francisco going? You know, the one approved by California's fabulous voters as part of California's fabulous initiative process. Well, a new estimate for the nice, easy part between Merced and Bakersfield puts the cost at $10-$14 billion, up from earlier estimates of $6.8 billion made a mere three years ago:

If the cost of the entire project balloons at the same pace as the Central Valley section, the San Francisco-to-Anaheim railroad would cost from $63 billion to $87 billion, similar to what independent analysts have been predicting. And those figures do not include inflation, which could push the final cost toward a staggering $100 billion. When California voters approved the project in 2008, the state said it would cost $33 billion, but it soared to $43 billion a year later.

I'm no engineer, but I'm willing to risk a few C-notes that this project ends up at $100 billion or more in 2011 dollars. Any takers? This is a very long-term bet, of course, since the line isn't scheduled to be finished until 2020—and I'm willing to put up a few more C-notes that it'll be more like 2025 or 2030. Or never.

Look, I'm sorry, HSR lovers. I love me some HSR, too, but this project is just a fantastic boondoggle. It didn't even make sense with the original cost estimates, and it's now plain that it's going to cost three or four times more than that. What's more, the ridership estimates are still fantasies, and it won't be able to compete with air travel without large, permanent subsidies. This is just too much money to spend on something this dumb. It's the kind of thing that could set back HSR for decades. Sacramento needs to pull the plug on this, and they need to pull it now. We have way better uses for this dough.

Last year Michael Lewis wrote a much-lauded piece about Greece, and because it's Michael Lewis it was indeed a great piece. Michael Lewis could probably make a grocery list sound fascinating.

Unfortunately, buried within its 10,000 words or so was....nothing. Greece's finances are in terrible shape, he said, because Greeks don't pay their taxes. That's it. I think I'm summarizing the piece pretty fairly when I say there was virtually nothing else to it aside from scenery.

This month in Vanity Fair Lewis takes on Germany. And again, it's a great read. But also again, there's practically nothing there. The piece is built around an extremely strained extended metaphor about the German fascination with shit and excretion — because, you see, all those toxic assets in the Wall Street securities they bought were shit, which makes it no wonder they ended up with so much of it. Get it? Now, this produces a few funny riffs, but it's also completely ridiculous. This is not why German bankers bought lots of CDOs stuffed with crappy subprime loans. (Hah! Crappy loans. He's got me doing it too!) How did VF's editors let him get away with this nonsense?

The rest of the essay, aside from a few paragraphs explaining some technicalities about how the ECB works, tells us nothing. Germans, apparently, are prudent, rule-bound, gullible, guilt-ridden, and punctual. Prudent explains why their economy is still in good shape. Rule-bound explains why they were willing to buy so many AAA-rated securities without looking very carefully at what they contained. Gullible explains how Wall Street's sales force was able to pull the wool over their eyes for so long. Guilt-ridden explains how they got suckered into adopting the euro. And punctual is just there to add some color.

For what it's worth, I have to say that gullible isn't really one of those stereotypical German traits that you find on postcards. The rest are, though, and if this bit of armchair cultural psychoanalysis satisfies you, then I guess you're just easily satisfied. In my case, though, I want to know what's happened to the real Michael Lewis, the one who actually digs into complex financial issues and explains them with flair and wit and telling detail? I don't care how many people call his latest piece brilliant, the truth is that it's just lazy. He's now done this schtick for Iceland, Ireland, Greece, and Germany, and he's getting worse with each country. I suppose Italy must be next, but I can't say I'm looking forward to it.

Time's Michael Grunwald says that although the 2009 stimulus might have been too small, it sure has made a big difference to the American battery industry:

Before 2009, the U.S. was supplying less than 2% of a tiny global market in advanced batteries. When the stimulus-funded factories are all complete, they’ll have the capacity to supply 40% of a rapidly growing global market, about 500,000 batteries a year. The stimulus will also boost our supply of electric-vehicle charging stations by more than 3,000%. And the Obama administration has provided loans to help Tesla, Fisker and Nissan build electric-car factories in the U.S., all part of Obama’s pledge to put 1 million plug-ins on the road by 2015. That is what change looks like, even if the President doesn’t beat his chest and call for mass beheadings on Wall Street while it happens.

Point taken, though I wouldn't mind at least a few targeted beheadings on Wall Street as well. Plus there's this about newly announced fuel economy regs for big rigs:

The regulations call for reductions on fuel consumption and greenhouse gas emissions by 2018 of 9 to 23 percent, depending on the type of vehicle. Trucks and other heavy vehicles make up only 4 percent of the domestic vehicle fleet, but given the distance they travel, the time they spend idling and their low fuel efficiency, they end up consuming about 20% of all vehicle fuel, according to the Union of Concerned Scientists. Experts say that a 20 percent reduction in heavy vehicle emissions would boost fuel efficiency to an average of 8 miles per gallon from 6 miles now.

The announcement comes less than two weeks after Obama and the country’s automakers unveiled new fuel economy rules for passenger vehicles that would boost fleet-wide average gas mileage to 54.5 miles per gallon by 2025, from about 27.8 miles per gallon now.

Let's do some arithmetic. Trucks use 20% of all vehicle fuel, and the new standards will increase their efficiency from 6 mpg to 8 mpg. That's 25% less fuel in a fleet that accounts for 20% of all fuel use, or 5% less total fuel used. It's not going to solve global warming all on its own, but it's probably more than you would have guessed. Add that to the new regs for cars and light trucks, and American gasoline use is going to go down pretty considerably by 2025. It just goes to show what vigorous executive action, combined with an implicit threat from us radical lefties in California,1 can accomplish.

1Just in case I'm being too opaque, here's what this means. California has long had an exemption that allows it to set its own standards for auto emissions, which in the case of CO2 is basically the same thing as setting standards for fuel economy. Automakers really, really don't want to have separate standards for California and everywhere else, so the threat that we communists in the Golden State will unilaterally ratchet up our own standards gives them an incentive to agree to nationwide standards that are tougher than they'd otherwise agree to. You can thank us later.

UPDATE: I'll grant, though, that this is a good question: Why are big rigs are so inefficient in the first place, given that they're commercial vehicles and their owners are pretty obsessive about fuel costs? My guess is that just like commercial building owners, truck owners simply don't always focus on long-term things like energy efficiency. It's human nature.

Matt Yglesias, apparently as bored during the August recess as I am, posts a chart today showing that highly educated people spend a lot more on alcohol than poorly educated people. Why is this? James Joyner, who has a PhD to hone his analytical skills and (presumably) also likes to drink, takes a whack at this:

Increasing levels of education correlates with increased income and, presumably, more disposable income. As people attain more education and income, they’re likely to switch from cheap beer (Miller Lite) and cheap booze (Seagrams gin, Jim Beam bourbon) to better and more expensive beer (say, Dogfish 160) and booze (Bombay Sapphire gin, Macallan 12 Scotch). Also, they’ll drink wine that comes in bottles not boxes. Additionally, they’ll be more likely to drink at bars and pricey restaurants, thinking nothing of paying $6 for a pint of beer, $9 for a glass of wine, or $12 for a cocktail.

James's PhD and alcohol swilling ways have served him well. As this chart from a 2000 paper produced by the BLS shows, weekly alcohol expenditures increase strongly with income. Here's how it breaks down:

  • Expenditures on beer double between the lowest and highest income quintiles.
  • Expenditures on wine quintuple.
  • Expenditures on "other" (mostly mixed drinks, I assume) also quintuple.
  • Expenditures on alcohol consumed at home go up 170% while expenditures on alcohol consumed elsewhere go up 600%.

So yeah: wealthier people might drink more alcohol than poor people, but probably not by much. Mostly they just buy more expensive stuff at home as well as more pricey drinks in bars and restaurants. Now you know.

I missed this when it happened Monday, but here's some interesting news from my home state:

A national movement aimed at sidelining the Electoral College in presidential elections got a big boost Monday when Gov. Jerry Brown signed legislation adding California to the list of states supporting the drive. Brown's signature makes California the ninth state to sign on to the effort, which would hand the electoral votes of all participating states to the presidential candidate who wins the most votes nationwide. Currently, California's 55 electoral votes go to the person who wins the most votes in the state.

The idea here is to round up states with at least 270 electoral votes who will agree to cast all their votes for whatever candidate wins the national popular vote. California's support is crucial, since it brings the number of committed electoral votes to 132. It wouldn't be impossible for this deal to work without California's 55 electoral votes, but it would be pretty hard. So this is good news.

There are some weird objections to this, the most common of which is that it will turn the whole country into a gigantic Florida circa 2000. And anything is possible, of course. But it's vanishingly unlikely: it's unusual enough for a single state to have a result so close that it inspires the kind of massive court challenges we saw in Bush v. Gore, but it's close to impossible for it to happen on a national level. Even in 2000, the national vote for the two candidates differed by more than 500,000. It would only be worth challenging an election if this number were so small that there was a legitimate chance of overturning the result, and what are the odds of the entire national vote being within, say, 20,000 votes? Nada. And anything further apart than that isn't worth going to court for.

This won't fix our dysfunctional Congress, which is currently a more pressing problem than the Electoral College, but it's still a good thing. Only 138 electoral votes to go!

Is It 1931 Again?

Dan Drezner is feeling very gloomy tonight:

The start of the Great Depression is commonly assumed to be the October 1929 stock market crash in the United States. It didn't really become the Great Depression, however, until 1931, when Austria's Creditanstalt bank desperately needed injections of capital. Essentially, neither France nor England were willing to help unless Germany honored its reparations payments, and the United States refused to help unless France and the UK repaid it's World War One debts. Neither of these demands was terribly reasonable, and the result was a wave of bank failures that spread across Europe and the United States.

The particulars of the current sovereign debt crisis are somewhat different from Creditanstalt, and yet it's fascinating how smart people keep referring back to that ignoble moment. The big commonality is that while governments might recognize the virtues of a coordinated response to big crises, they are sufficiently constrained by domestic discontent to not do all that much.

So... is this 1931 all over again?

Read the rest to see why Dan thinks it might be. My own take is that it's probably not, partly because 1931 already happened and we've learned at least a little something since then. As senseless as a lot of our recent political behavior has been, so far national governments have been willing to respond to prevent imminent catastrophes from getting out of hand. It might not happen until the last second, but in the end, they finally do the right thing — or at least enough of the right thing to keep things puttering along.

What national governments haven't shown the will to do is address issues that are slightly less than catastrophic. As a result, our recovery is going to be much slower than it needs to be, and it might even tip into a second recession. More than likely we'll avoid 1931, but I'm increasingly unsure we'll avoid 1981.

Centrist moderate balanced nonpartisan independent columnist Matt Miller on his irritation with President Obama right now:

Here’s the thing. I know Tea Party Republicans were behind the debt-ceiling standoff that wreaked needless damage on confidence in the United States. I wrote weeks ago of Standard & Poor’s outrageous nerve in threatening a downgrade when America’s ability to pay its debts can’t possibly be in doubt. In short, I know who the real villains are at this volatile moment.

So why am I so mad at Barack Obama?

Feel free to click the link if you want to read more. I didn't much feel like bothering myself.

Honest to God, Republicans must all be sitting in their back rooms and just cackling like hell right now. Think about it. They developed a strategy to hamstring the president completely — a strategy that's bulletproof thanks to our country's Constitution — knowing that it would rally their base but also hoping that it would cause moderates and lefties alike to become disgusted with Obama's weakness even though we all know who's really responsible for what's going on. And it worked! In fact, it's worked better than they could possibly have imagined. They can probably barely keep from spitting up their beers right now.

We are such chumps.

Bruce Bartlett rounds up public sentiment on tax increases and finds that in poll after poll the public is strongly in favor of tackling the deficit not with spending cuts alone, but with spending cuts plus at least some tax increases. The majorities in favor of raising taxes range between 60-70%.

Which is all fine. Unfortunately, as with nearly all polls, these don't measure intensity of feeling. And I don't think anyone will be surprised if I suggest that the one-third of Americans opposed to tax increases feels really strongly about it while the two-thirds who support them don't really care all that much. They're certainly nowhere near ready to kick people out of office if they decline to vote for a tax increase.

This is, of course, the story of politics everywhere. A motivated minority trumps an apathetic majority every time. They always have and they always will. Until we can get people out in the streets with torches and pitchforks in favor of raising taxes on the rich, these polls just don't mean much.

Fannie Mae and Freddie Mac — now owned by you, the taxpayer! — have foreclosed on lots of homes. Those foreclosed homes act as a drag on the housing market, but Fannie and Freddie are reluctant to just get rid of them once and for all by offering them in bulk at rock bottom prices. Why? Because that would cause us, the taxpayers, to lose even more money than we already have on Fannie and Freddie.

So now the Obama administration is "seeking investors' ideas" on a new proposal to rent out the homes instead of keeping them on the market:

One proposal would sell packages of hundreds or thousands of foreclosed properties in bulk to investors that agree to rent them out. That approach is preferred by the Department of Housing and Urban Development, which is taking back properties as defaults mount on loans backed by the FHA.

Another approach would let investors enter joint ventures with Fannie or Freddie to invest in a pool of converted rental homes. A national property-management business would handle day-to-day landlord responsibilities. Investors would pay for rehabbing and maintaining properties and would share revenue from monthly rental income and the ultimate sale of the property. Such a joint venture would be modeled on the Resolution Trust Corp., which sold failed banks' assets in the early 1990s.

Jared Bernstein thinks this is an idea worth trying, and that makes me loath to admit that I don't get this. But....I don't get it. Right now, investors are free to buy packages of foreclosed properties any time they want and then do whatever they like with them. Sell them, rent them, demolish them, whatever. The problem is that Fannie and Freddie are asking too high a price so no one is interested.

So what changes under this new proposal? Well, we're going to put a new restriction on what investors can do with their foreclosed properties: they'll only be allowed to rent them. What's more, apparently there will be some additional regulations to make sure that investors who participate in this plan will be good landlords. But restrictions and regulations make the properties less valuable, no? So investors will not only remain unwilling to pay Fannie and Freddie's asking price, they'll be even less willing than before because the properties now have additional encumbrances on them.

I just don't get this. This plan would presumably require F&F to offer their foreclosed homes at fire sale prices. But if we're willing to do that, why not just offer them at fire sale prices and be done with it? Why waste time with the rental plan? What am I missing here?