Kevin Drum

Jeb Bush Has an Obamacare Problem

| Fri Dec. 26, 2014 10:52 AM EST

From Politico:

Jeb Bush is stepping down from the board of a health care company that has reportedly profited from Obamacare, a move that comes as the Republican explores a run for the presidency.

According to various media reports, Tenet backed President Barack Obama’s health reform act and has seen its revenues rise from it. Bush’s involvement with Tenet could give ammunition to conservatives in the GOP who view him as too moderate — particularly those who despise the Affordable Care Act.

I can't help but get a chuckle out of this. In normal times, Bush would have left Tenet because it's a big, soulless corporation that's paid fines for Medicare fraud and been criticized for dodgy tax practices at the same time it was beefing up executive pay. A man of the people who aspires to the Oval Office can't afford to be associated with this kind of dirty money.

But no. At least if Politico is to be believed, this isn't really an issue in the GOP primary. What is an issue is that Tenet might have profited from Obamacare, which in turn means that Jeb may have profited from Obamacare. Even if it's a double bank shot, that's dirty money in tea party land.

Of course, Jeb also has some of the more conventional plutocratic image problems:

Soon after his tenure as governor ended, Bush became an adviser to Lehman Brothers and, later, Barclays....In May 2013, Bush set up Britton Hill Holdings and dove into the private equity business....Bush’s first fund invested in Inflection Energy....His next one, BH Logistics, raised $26 million this spring from investors including China’s HNA Group....Bush’s newest fund, [U.K.-based] BH Global ­Aviation, is his largest and most complicated. It deepens his financial ties to China and Hainan....“In many deals, the U.K. ­effectively serves the same function as the Cayman Islands or Bermuda,” Needham says. “It’s like a tax haven, except it’s the U.K.”

Plus there's the fact that Jeb stayed on as an advisor to Barclays for years after it was fined for illegally trading with various blacklisted countries, notably including Cuba and Iran. If being on the board of a company that profited from Obamacare is a problem, surely this is at least equally bad. The attack ads write themselves, don't they?

Anyway, apparently Jeb is now in cleanup mode:

“These are all growth investments that the governor has worked on,” said Bush’s spokeswoman, Kristy Campbell....Campbell said the 61-year-old former governor is “reviewing all his engagements and his business commitments” now that he’s begun to focus on a potential race. “That’s a natural next step,” she said.

Indeed it is. On the other hand, Mitt Romney severed most of his ties with Bain Capital a full decade before he ran for president, and just look at how much good that did him. Jeb probably isn't out of the woods yet.

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The NSA Is Surprisingly Open-Minded About Analysts Spying on Their Spouses

| Fri Dec. 26, 2014 9:35 AM EST

Via Bloomberg, we learn that the NSA chose Christmas Eve to release its latest set of reports on violations of surveillance rules by its analysts. Nice work, NSA! For the most part, the reports don't appear to contain anything especially new, but I was struck by this particular violation:

The OIG's Office of Investigation initiated an investigation of an allegation than an NSA analyst had conducted an unauthorized intelligence activity. In an interview conducted by the NSA/CSS Office of Security and Counterintelligence, the analyst reported that, during the past two or three years, she had searched her spouse's personal telephone directory without his knowledge to obtain names and telephone numbers for targeting....Although the investigation is ongoing, the analyst has been advised to cease her activities.

Wait a second. She was caught using NSA surveillance facilities to spy on her husband and was merely told to cease her activities? Wouldn't it be more appropriate to, say, fire her instantly and bar her from possessing any kind of security clearance ever again in her life? What am I missing here?

Chart of the Day: War on Christmas Continues to Take a Drubbing

| Thu Dec. 25, 2014 8:38 PM EST

With the Christmas season now officially closed, I figured everyone would appreciate a final update on how our troops performed this year in the War on Christmas™. And since my Wikipedia entry insists that this blog is known for "original statistical and graphical analysis," that's what you're going to get.

So then: the chart below is a Google Ngram showing the popularity of Merry Christmas vs. Happy Holidays. I'm sorry to report that contrary to suggestions from certain quarters, Happy Holidays has been taking a terrific and sustained beating ever since the mid-70s. I took the liberty of extending the trendline based on an extensive personal sampling of popular music and TV shows, and I'm afraid the results were devastating: 2014 was yet another year of Happy Holidays getting its ass kicked. In 1975 we were behind by 2 x 10-5 percentage points. Today we're behind by 5 x 10-5 percentage points, and falling farther behind every year.

I know this might be discouraging news to some of you, but buck up, urban liberals! Happy Holidays is still doing better than the Lakers, the Bears, and the Knicks. Just wait 'til next year.

Merry Christmas!

| Thu Dec. 25, 2014 7:35 AM EST

We all still miss the late, much beloved Inkblot, but I figured this year it's time to celebrate the new cats in our family. So we have an all-new Christmas ornament. I did my best to retain all the charm of the old ornament, but this one features the new, much beloved Hopper. Merry Christmas, all.

Christmas Movies Are Now Just As Horrible As Everything Else Related to Christmas

| Wed Dec. 24, 2014 3:02 PM EST

Well, this answers a question for me. Dan Drezner describes the standard Jewish ritual for Christmas day:

Chinese food and a movie. Perfectly pleasant rituals, made special by the fact that the Gentiles are all at home or at church....

No longer.

I don’t know when it became a thing for Christian families to also go see a movie on the day commemorating the birth of Jesus, but personal experience tells me this is a relatively recent phenomenon — i.e., the past 15 years or so. All I know is that what used to be a pleasant movie-going experience is now extremely crowded.

Several years ago I naively decided that it might be nice to see a movie on Christmas. I figured the crowds would be really light and we could just slip right in. Needless to say, I was disabused of this notion quickly, and headed for home just as fast as my car would take me. At the time, I wondered what was going on. Had things changed? Was I just unaware that Christmas had always been a big movie day? Or what?

I guess it's the former. There really was a golden era when Christmas movies were uncrowded, but it disappeared before I even knew it existed. Sic transit etc.

The Hotel Industry Is Apparently Hellbent on Screwing Its Guests

| Wed Dec. 24, 2014 2:50 PM EST

The sheer venality and barefaced contempt for its customers that's so often displayed by corporate America never ceases to amaze me. I had no idea this was going on:

Microsoft and Google don’t agree on much, but they’ve presented a united front against the hotel industry, which is trying to convince government regulators to give them the option of blocking guests from using personal Wi-Fi hotspots....In October, Marriott settled an FCC complaint about the practice for $600,000 but argued that it hadn’t broken the law and was using technology to protect guests from “rogue wireless hotspots that can cause degraded service, insidious cyber attacks and identity theft.”

....Opponents of the proposal basically argued in filings late Monday that the hotel industry is just trying to keep guests and exhibitors dependent on pricy hotel wireless networks. They suggested hotels have other options for protecting Wi-Fi networks than jamming personal hotspots.

Years ago hotels lost the ability to charge outrageous prices for phone calls, so now they're engaged in a desperate rear-guard attempt to keep charging outrageous prices for Wi-Fi. Here's a suggestion instead: provide decent rooms at reasonable prices, and offer your guests additional services at reasonable prices too. Ho ho ho.

POSTSCRIPT: I wonder what the range of these jamming devices is? If Marriott or Hilton ends up jamming a Wi-Fi hotspot that someone is using on a public sidewalk outside one of their hotels, are they liable for damages?

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How Much Would You Pay For $4,905 In Pension Benefits?

| Wed Dec. 24, 2014 1:03 PM EST

Adam Ozimek points us to some recent research suggesting that people don't actually value pensions very highly:

The study utilizes a change in policy in Illinois that allowed teachers to purchase more pension benefits in exchange for a one-time fee. This allowed the determination of how much teachers are willing to pay for marginal pension benefits. The authors found that on average, teachers valued each $1 in marginal pension benefits at $0.20.

This is useful information for two reasons. First, it suggests states may be able to save money and make teachers better off by buying back pension obligations in exchange for current lump sum payments. Second, it suggests that for districts looking to cut costs, decreases in benefits do not need to be offset with equal dollar value increases in current pay in order to maintain labor supply.

(Yes, that's 20 cents for one dollar of present value. Specifically, the study finds that on average, teachers are willing to pay only $1,000 for benefits that the pension fund has to pay $4,905 to purchase.)

But does this mean that Illinois teachers would snap up a $1,000 lump sum today in return for a decrease of $4,905 in future pension benefits? Not so fast, pardner. A combination of status quo bias, loss aversion, and the endowment effect suggests that things wouldn't be so easy.

Status quo bias is just what it sounds like: we all tend to succumb to a sort of emotional inertia that favors whatever benefits we happen to be getting at the moment. Loss aversion is the well known effect that people work harder to avoid the loss of $X than to secure the gain of $X. And the endowment effect causes people to ascribe greater value than normal to things they own, solely because they happen to own them. Put all these things together, and it's highly unlikely that Illinois teachers would be willing to sell off a dollar of benefits they currently get in return for 20 cents today. In fact, it's quite possible they'd only sell it off for more than a dollar.

Of course, this applies only to workers who are already vested in a pension system. For brand new workers, given a choice of salary today vs. pension tomorrow, it's quite possible they'd undervalue the pension. In fact, I'd say it's almost inevitable, since most of us do exactly that. Nonetheless, I'm skeptical that this research tells us much about either the size of this effect or whether it would be good public policy to even offer the option. The circumstances are just too different.

The Wonkosphere's Top Evergreen Stories, Explained

| Wed Dec. 24, 2014 11:01 AM EST

The news business has always had evergreen stories. When Time magazine asks "Why Did Jesus Have To Die?" on its cover, it's following in its own footsteps along with hundreds of others. If it's Easter, we have stories about Jesus.

The wonky blog world has its own odd set of evergreens. These are stories that might have been interesting the first time I read them, but which I'm now heartily sick of. So even though I'm a day late for this to be part of the Festivus airing of grievances, here are a few examples:

  • Does Daylight Savings Time really reduce energy consumption?
  • An economist explains why Christmas gift giving is inefficient.
  • The Declaration of Independence wasn't really signed on July 4th.
  • Christmas and those crazy Asians: KFC in Japan and Spam in South Korea explained.
  • Scientists are adding a second to the year today. Here's why.
  • The Dow is a lousy proxy for the actual state of the stock market.
  • Etc.

Of course, if this year happens to be the first time you see any of these evergreens, they're fresh and new to you. It's only the fact that I've seen them so many times that makes them so tired to me. So feel free to ignore my griping on this subject. In fact, feel free to mock me for it if you like.

Anyway, I was reminded of this by the inevitable spate of bloggish stories last week about why Christmas is inefficient, and then reminded again by not one, not two, but three bloggy pieces about KFC in Japan that I happened to see within five minutes of each other this morning. (Bad luck, that!) And it got me thinking: ordinary old-school evergreens all seem pretty understandable. But these wonkish blog evergreens seem....a bit odd. So I'm curious: what is it that makes a subject a bloggy evergreen? What do these kinds of stories have in common?

Once I figure it out, I plan to write a blog post about it every year. Sort of like the one I write every year about the origins of Black Friday. Are you sick of that one yet?

Hollywood Backstabbing Over "The Interview" Now in Full Swing

| Wed Dec. 24, 2014 10:14 AM EST

We all heard yesterday that Sony Pictures made a last-minute decision to release The Interview on Christmas after all, thanks to pleas from a couple hundred independent theaters that agreed to defy Kim Jong-un and show it. So the honor of Western civilization is saved and everyone is happy. Right?

The film's limited release drives a further wedge between Sony and the nation's largest theater owners, who blame the studio for yanking away a potential hit. It was supposed to open on 3,000 screens before Sony and theater chains shelved the movie.

Theater owners are also upset that Sony is negotiating to release the movie simultaneously on a video-on-demand platform...."They could have a full theatrical release. Instead they have a token," said one theater executive who asked not to be identified because it could harm his relationship with the studio.

Wait. What? I thought this whole fiasco had been driven in the first place by the refusal of big theater chains to show the movie amid fears of terrorist retaliation. So what are they all griping about?

The disagreement over a digital release played into larger tensions between Sony and theater owners after hackers last week threatened physical harm on moviegoers who saw "The Interview."....Worried about a potential threat, Sony said it canceled the movie after large chains backed away from the film.

But theater owners have been pointing the finger at the studio for originally giving them the OK to not run the film amid the threats. Then Sony blamed the nation's four big theater chains for forcing the studio to cancel the original release....Representatives of Regal, AMC, Cinemark and Carmike declined to comment on the matter.

OK, I guess I'm officially confused. Did Sony cancel the Christmas release date of The Interview because malls and theater chains were desperate to back out of showing it? Or did malls and theater chains back out because Sony had implicitly urged them to do so when it gave the chains permission to break their contractual commitments to show the movie? Or are both sides now just furiously trying to shift blame after being called out for cowardice by everyone from George Clooney to President Obama?

The latter, I suppose. In any case, now I know what I want for Christmas: A country that doesn't spin into a damn tizzy over every little thing. From Ebola to ISIS to the Sony hack, you'd think we were all at risk of losing our lives to outside forces every time we step off our front porches. In the immortal words of Aaron Rodgers, can we all please R-E-L-A-X?

Quote of the Day: "That Could Have Been Any One of Us"

| Tue Dec. 23, 2014 8:42 PM EST

From Michelle Conlin of Reuters, who interviewed 25 active-duty and retired black NYPD police officers, nearly all of whom said they themselves had been treated harshly by fellow cops when they were out of uniform:

At an ale house in Williamsburg, Brooklyn last week, a group of black police officers from across the city gathered for the beer and chicken wing special. They discussed how the officers involved in the Garner incident could have tried harder to talk down an upset Garner, or sprayed mace in his face, or forced him to the ground without using a chokehold. They all agreed his death was avoidable.

Said one officer from the 106th Precinct in Queens, “That could have been any one of us.”

It shouldn't be too hard to hold two thoughts in our minds at once. Thought #1: Police officers have an intrinsically tough and violent job. Split-second decisions about the use of force come with the territory. Ditto for decisions about who to stop and who to keep an eye on. This makes individual mistakes inevitable, but as a group, police officers deserve our support and respect regardless.

Thought #2: That support shouldn't be blind. Conlin reports that in her group of 25 black police officers, 24 said they had received rough treatment from other cops. "The officers said this included being pulled over for no reason, having their heads slammed against their cars, getting guns brandished in their faces, being thrown into prison vans and experiencing stop and frisks while shopping. The majority of the officers said they had been pulled over multiple times while driving. Five had had guns pulled on them."

Respect for the police is one of the foundation stones of a decent and orderly society. But police work is one of several professions that are inherently coercive and invest their members with tremendous amounts of sometimes unaccountable power over the rest of us. It's equally a foundation stone of a decent and free society to maintain vigilant oversight of professions like this, and to deal vigorously with the kinds of systemic problems that the routine exercise of power and authority makes unavoidable. Belief in the latter does not exclude belief in the former.