Kevin Drum

Iceland Is Too Tiny to Be a Poster Child For the Financial Crisis

| Thu Jun. 11, 2015 10:35 AM EDT

For what it's worth, there's been a bit of talk lately about how well Iceland is doing and how everyone should have followed their example in the aftermath of the 2008 financial crisis. Tyler Cowen has a fair-minded response here. In short: Some of what Iceland did was probably good, including devaluing and inflating their currency, and "ring fencing" their good banks from their bad. But most of their actions simply wouldn't work in most other countries. For starters, Iceland is the size of a small city like Bakersfield. Their actions caused no global repercussions. Second, Iceland mostly forced foreign depositors to take the hit from the crisis, something that wouldn't work in a country with lots of domestic deposits. Third, its stock market is minuscule. A 90 percent drop didn't have a big effect on the economy, but it would in a larger country. And finally, capital controls aren't a serious option for most large countries.

Overall, I agree with Cowen. Sure, maybe we should have treated our bankers more harshly, as Iceland did. But generally speaking, a tiny, isolated island can get away with a lot of things just because they're so tiny and isolated that big countries have better things to do than try to retaliate. Who really cares about Bakersfield in the Atlantic, after all? They just aren't much of an example of what could and couldn't have been done by larger, more systemically important countries in 2008-10.

Advertise on MotherJones.com

Chuck Schumer Is Not Working the Refs Very Well

| Wed Jun. 10, 2015 4:47 PM EDT

This is kind of fascinating:

After almost six months in the minority, Charles E. Schumer says Senate Democrats aren’t afraid to be obstructionists, detailing a strategy of blocking appropriations bills and other Republican agenda items until they get what they want....Schumer (D-N.Y.) said they are joining with President Barack Obama behind a plan to try to force Republicans to the negotiating table over everything from domestic and defense spending to highway funding and international tax reform.

....The White House-backed plan to get Republicans to support more spending for domestic programs by blocking floor consideration of appropriations bills was developed in a series of closed-door meetings held over the course of several weeks.

....To maintain their leverage, Democrats have decided to block all spending bills starting with the defense appropriations measure headed to the floor next week. Durbin told reporters on Tuesday that there is also no ruling out a blockade of program authorizations, like upcoming votes on highway funding.

It's not the substance of Schumer's comments that's fascinating. By now, even the checkout clerks at the local Safeway know that Democrats plan to obstruct everything and anything. It's time for Republicans to get a taste of their own dog food.

No, what's fascinating is that Schumer is so open about it. As I recall, ever since 2009 Republicans have adamantly refused to ever publicly admit that this was their strategy.1 And there was sound thinking behind that. The rules of objective journalism prevent reporters from just flatly attributing something to a party unless they have a party leader on the record fessing up to it. So instead they have to tiptoe around the subject, or quote liberal activists accusing Republicans of obstructionism, or something like that. This leaves things a little fuzzy or "controversial" in a lot of people's minds, which means they never really accept the whole obstructionism story. Hey, maybe each individual filibuster really is a matter of principle.

But if a party leader just comes out and admits it, then that's that. No one will ever believe that Democrats are being principled because Schumer has already given the game away. Republicans were obstructionist, so we're going to be too.

That's a mistake. It may seem dumb to keep up a pretense that everyone knows is baloney, but there really is a reason for it. It won't fool all the people all the time, but who cares? It will handcuff the press, and thereby fool some of the people some of the time. That's worth a lot.

1This is why President Obama keeps talking about "working" with Republicans and "finding common ground" even though he knows perfectly well by now that this isn't going to happen. He knows the press has to report it regardless of whether they think he really believes it. This means people see it on the news, and some of them will continue to believe that this is what he's trying to do.2

2Which, admittedly, he is trying to do in a few special cases. But not many.

Hillary Clinton: Master Schemer or Garden Variety Pol?

| Wed Jun. 10, 2015 2:26 PM EDT

Jonathan Allen recycles a familiar refrain today:

There's a term for the way Hillary Clinton has handled policy in the early stages of her campaign: Clintonian. That is, on the issues that most divide the Democratic base from its centrist wing, she refuses to box herself into a position.

....It's true that Clinton has rolled out a string of positions that please constituencies on the left, from support for LGBT rights and voting rights to repudiating the results of her husband's 1994 anti-crime law and vowing to enhance President Obama's executive action on immigration. These are important issues, perhaps more important than the exact level of a wage increase that surely won't be $15 an hour as long as Republicans control either the House or 41 seats in the Senate. But Clinton has been very selective about how she's courted her party's progressive base, speaking as much to identity politics as to actual policy. On some of the more controversial policy questions, she's taking a pass.

I'll concede right up front that Hillary Clinton has been in the national eye for more than 20 years, and maybe that means we should expect more from her. But I gotta ask: Is there now, or has there been in the past, any other candidate who has been so routinely disparaged for not having positions on every single topic seven months before the first primary? Correct me if I'm wrong, but every candidate rolls out positions over time during presidential contests. And they all do it the same way: based on a combination of (a) their own genuine beliefs, (b) interest group pressure, (c) internal polling and focus groups, and (d) weeks or months of research and discussion among their advisors and messaging staff.

Everyone who's serious about running for president does this, and it's been this way for decades. This is simply not something that's unique to either Bill or Hillary Clinton.

So....what's up with the press corps pushing this narrative so assiduously? Are they just so stuck on the tired old "triangulation" metaphor that they can't escape from it? Do they genuinely think Hillary is slower about taking positions than other candidates? Do they think those positions are routinely fuzzier than those from other candidates? Are they stuck in the 90s and convinced that all Clintons are connivers and liars? Or what?

I don't understand this. In terms of campaigning and political positioning, Hillary strikes me as a pretty garden variety candidate. Am I wrong?

"Streamlining" Government Is a Dubious Campaign Message, Especially For Democrats

| Wed Jun. 10, 2015 1:03 PM EDT

A few days ago I criticized a policy analysis from Stan Greenberg that, among other things, recommended that Democrats run on a commitment to streamlining government. But exactly what concrete proposals would that entail? Today, Mark Schmitt takes a crack at answering:

"Streamlining" government does not have to involve only cutting costs, though that might be a part of it. The tax code, for example, is now as complex for low- and middle-income taxpayers as for the wealthy, littered with credits and deductions, some refundable and some not. Streamlining government could include a strong commitment to making the tax code simpler at the low end and shifting resources to fight fraud at the top end. It could include, for example, efforts to create a single, simple portal to government services ranging from health insurance under the Affordable Care Act to small business assistance—similar to the "no wrong door" initiatives in several states.

Above all, it should include a positive vision of reform of the political process, and the role of money, that does more than reimpose limits on the political influence of the very wealthy, but empowers citizens as donors and participants. And, the most difficult challenge of all, there has to be an effort to restore to the public face of government, the legislative process, a sense of compromise and shared commitment to the public good, despite deep disagreements.

Simplifying the tax code for the middle class is fine, I suppose, though nearly half the population already files either 1040 EZ or short forms. But that single portal sounds to me like something that's way, way, way harder than it sounds. Maybe I'm wrong about that. But in order to make a difference, not only does this portal have to be a work of genius, so do all the things it leads to. It doesn't do any good to make it easy to find Obamacare if it's still a pain in the ass to sign up for it. Honestly—and I say this from at least a little experience—this is the kind of thing that sounds good until you have to put together the interagency committee to actually create it.

I don't mean to just pooh pooh other people's ideas. But I think it's telling that Schmitt had only two or three proposals, and most of them are either really hard or probably not that effective.

Look: the US government is really big. There's no way around that. And as every large corporation in the world knows, there's just a limit to how easy you can make things when a bureaucracy gets really big. There's no magic wand. That said, here's what I'd like to see: some detailed polling work that digs below the surface of "streamlining" and asks people just what it is about the government that really burns them up. I suspect (but don't know!) that you'd discover a few things:

  • A lot of complaints—probably the majority—would be about state and local issues. (Business licenses, building inspections, traffic tickets, etc. etc.)
  • A lot of the complaints would be unrelated to government complexity: taxes are too high, guns should be unregulated, abortions should be outlawed, and so forth.
  • When we finally got to the complaints that are (a) about the federal government and (b) truly about the difficulty of getting something done, the griping would be all over the map. The truth is that it's mostly businesses—especially large ones—that engage frequently with federal regulations. Aside from taxes and Medicare/Social Security, most individuals don't very often. But when they do, they're naturally going to believe that their particular circumstance should have been way easier to handle. In some cases they're right. In most cases, they simply don't know how many different circumstances the agency in question has to handle.

I'm not saying nothing can be done. I just have a suspicion that complaints about the "incompetence" or "red tape" of the federal government are mostly smokescreens for other things. Those other things are laws that people just don't like, or fees they just don't want to pay, or stuff they've merely heard from friends or the media.

This isn't to say that streamlining government is a bad idea. It's not. It's a good idea! But I want details backed up by actual research, and even then, I suspect there's less we can do than we think. As a platform for a campaign, I'm even more skeptical. Maybe a proposal to streamline some specific program that lots of people use and lots of people hate would work. But "streamlining government" as a generic pitch? I doubt it—especially for Democrats. It would be like Republicans wanting to "streamline" taxes for the rich. Would you believe them?

Europeans Reject War; Would Prefer US Just Do the Job For Them

| Wed Jun. 10, 2015 10:49 AM EDT

Hmmm. Compare and contrast these two results from a recent Pew poll in Europe:

So, for example, only 38 percent of Germans would bother defending a fellow NATO ally if it were attacked by Russia, but 68 percent think the US would do the job. Is this cause and effect? Or something else?

In any case, Europe's view of the US as a global cop who will save them if worse comes to worst seems to still be strong. As always, NATO seems to be something of a one-way street for most Europeans.

Obama Announces Bold New Decade-Old Strategy in Iraq

| Wed Jun. 10, 2015 10:29 AM EDT

Here's our bold, new, never-before-tried strategy for beating ISIS:

In a major shift of focus in the battle against the Islamic State, the Obama administration is planning to establish a new military base in Anbar Province, Iraq, and to send up to 450 more American military trainers to help Iraqi forces retake the city of Ramadi.

....To assemble a force to retake Ramadi, the number of Iraqi tribal fighters in Anbar who are trained and equipped is expected to increase to as many as 10,000 from about 5,500.

More than 3,000 new Iraqi soldiers are to be recruited to fill the ranks of the Seventh Iraqi Army division in Anbar and the Eighth Iraqi Army division, which is in Habbaniyah, where the Iraqi military operations center for the province is also based.

Roger that. More American "trainers." More Iraqi fighters, who will turn out to be great this time. Honest. Oh, and a brand new target: Ramadi instead of Mosul.

Should work like a dream. I can't think of anything that could go wrong this time.

Advertise on MotherJones.com

Is King v. Burwell Already a Done Deal?

| Tue Jun. 9, 2015 1:44 PM EDT

I'm curious about something. I've read what now seems like a thousand blog posts about whether Republicans are going to offer a plausible legislative fix if the Supreme Court kills Obamacare subsidies in states that use the federal exchange. (Answer: no.) I've read another thousand about what the effect will be if the Supreme Court kills Obamacare subsidies. And another thousand about other topics related to King v. Burwell.

But all these posts and news articles seem to be written less and less in the conditional tense. It's as if everyone has already given up on the possibility that the Supreme Court will do the right thing and simply hand down a ruling based on the plain intent of the law, keeping Obamacare subsidies in place.

So how about that? Have we all given up? Maybe I'm being far less cynical than I should be, but I'm still assuming King v. Burwell will go against the plaintiffs.

Am I alone in this? What are the Vegas odds these days on how the ruling is going to go?

Louisiana Republicans Now Wish They'd Never Heard of Grover Norquist

| Tue Jun. 9, 2015 11:29 AM EDT

It's hardly surprising when Democrats criticize Grover Norquist, the godfather of the anti-tax movement. But following like sheep behind Norquist's demands to lower taxes always and everywhere has gotten states in so much trouble that even some Republicans are now begging him to be a little less obstinate. Sadly for Louisiana, Norquist is having none of it:

A group of self-described "conservative" Republican state representatives took their complaints to Norquist himself, asking him to give them some wiggle room on raising taxes and to shoot down some Jindal-backed legislation that they say would set a "dangerous precedent" in how government could mask revenue hikes.

....Sunday’s letter — signed by Louisiana House Ways and Means Committee Chairman Joel Robideaux (R) and 10 other state Republican representatives — asked Norquist to take into account the previous tax cuts Louisiana has passed in recent years and the effect they will have in the future when assessing whether the state is in compliance with the no tax pledge....Furthermore it asked Norquist to weigh in on the so-called SAVE proposal, which they said would allow governments in the future to raise billions of dollars in revenue in the guise of a revenue-neutral budget.

....However, Norquist refused to take the bait. While declining to come out for or against the tax credit proposal, he said it qualified as an offset and asked the lawmakers, "If you don’t like the SAVE Act, why not find other offsetting tax cuts that are more to your liking? "Norquist also scoffed at the Republicans' plea that their past tax cuts be taken into account, writing "[u]nder that logic, President Obama could argue he didn’t raise taxes."

In other words, go pound sand. But then, what did they expect? Norquist has one and only one thing going for him—thou shalt never raise taxes, no how, no way—and Bobby Jindal is still delusional enough to think he's running for president. So no taxes are going to be raised in the Pelican State. And if that causes massive pain and dislocation? Well, that's just tough, isn't it?

Here Are America's Top 50 Health Care Thugs

| Mon Jun. 8, 2015 5:36 PM EDT

As long as we're on the subject of how poor people get screwed in the United States, the Washington Post revisits an old favorite today: the way hospitals gouge the uninsured. Here's their summary of a new study that looks at the 50 biggest gougers, which charge uninsured patients more than ten times the actual cost of care:

All but one of the these facilities is owned by for-profit entities, and by far the largest number of hospitals — 20 — are in Florida. For the most part, researchers said, the hospitals with the highest markups are not in pricey neighborhoods or big cities, where the market might explain the higher prices.

....Community Health Systems operates 25 of the hospitals on the list; Hospital Corp. of America operates another 14. “They are price-gouging because they can,” said Gerard Anderson, a professor at Johns Hopkins Bloomberg School of Public Health, co-author of the study in Health Affairs. “They are marking up the prices because no one is telling them they can’t.”

....Most hospital patients covered by private or government insurance don’t pay full price because insurers and programs like Medicare negotiate lower rates for their patients. But the millions of Americans who don’t have insurance don’t have anyone to negotiate on their behalf. They are most likely to be charged the full hospital price. As a result, uninsured patients, who are often the most vulnerable, face skyrocketing medical bills that can lead to personal bankruptcy, damaged credit scores or avoidance of needed medical care.

It's hard to find the words to describe how loathsome this is. It's a structure deliberately designed to bleed the maximum possible amount from the people who are least able to afford it and least able to fight back. We normally associate this kind of thing with Charles Dickens novels, or with thugs in leather jackets who have a habit of breaking kneecaps. But these thugs all wear suits and ties.

I'm not really sure how they sleep at night, but I guess they find a way.

How Big Is the Penalty For Not Paying a 34-Cent Bill?

| Mon Jun. 8, 2015 2:30 PM EDT

Before we went up to City of Hope, Marian prepaid a bunch of our monthly bills. That way our service providers would all have a little stash of money to draw from in case we missed a bill.

As a result, we recently got a bill for 4 cents from Verizon. Please don't bother paying this, they said. We'll just pick it up in June's bill. We also got a bill for 34 cents from AT&T. Unlike previous bills, this one didn't include a return payment envelope and the remit portion of the bill didn’t include an address to send the payment. Sounds like they didn't want us to bother paying either, right?

Nope. They may want it to look like they don't want payment, but after finally getting hold of someone at the billing center (Marian is much more tenacious about this stuff than I am), they told us they did indeed want payment. In fact, if we didn't pay this 34-cent bill, we would be assessed a $6.50 late fee.

This is just a tiny slice of life that's either annoying or amusing for someone like me. However, it's also a tiny slice of life that, when you multiply it by a hundred, partly explains how poor people are continually screwed over and have a hard time ever digging out of debt. Nice work, AT&T. You are indeed a symbol of American ingenuity.