Kevin Drum

Prop 16 and Ratepayer Rage

| Thu Jun. 10, 2010 12:51 PM EDT

I argued yesterday that it was silly to insist on a narrative that credits voter rage for the passage of California's Prop 14, which changes the way primaries are held here. And I stick to that. After all, two years ago California voters approved Proposition 11, which also changed our electoral structure fundamentally by taking redistricting power away from the legislature. Like Prop 14, it passed narrowly. Like Prop 14, it was a follow-on to a previous similar initiative that had failed. Like Prop 14, it had the endorsement of most of the state's big newspapers. And guess what? No one suggested it passed because of voter anger. So why insist that this has to be the reason for Prop 14's passage?

If you're going to make that claim you need some actual evidence. So for that, let's turn instead to Proposition 16, a measure sponsored by PG&E that was billed as a "taxpayer's right to vote" but, in reality, was a cynical play to use the ballot box to prevent its competitors from expanding. PG&E spent nearly $50 million on Prop 16 and its opponents spent nearly nothing, but it went down anyway. Why? How about "ratepayer rage"?

Fed up with big bills, distrustful of new meters that show higher usage and chagrined by power shutoffs when payments are late, PG&E's customers sent a vote of no-confidence to the giant utility this week when they rejected the utility-sponsored Proposition 16.

Voters in counties served by Pacific Gas & Electric Co., which spearheaded the measure to deter government-run power providers, rejected the measure by large margins while counties less familiar with the state's largest electric utility supported it.

....Chris Davis, 45, who opposed Proposition 16, said she was still livid about the rolling blackouts a few years back. "PG&E is a force for evil," the San Francisco graduate student said. "I bundle up. I wear three sweaters, two hats and do jumping jacks before I will turn on the heat. I hate them. They are awful. And I'm a Buddhist. I don't usually talk like this."

The map above tells the tale. If you don't actually have to endure PG&E as your electricity supplier, their anti-tax message sounded pretty good. But if you do have to do business with them, you were in no mood to give them any more clout than they already have.

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The 5 Million Long-Term Unemployed

| Thu Jun. 10, 2010 12:27 PM EDT

Annie Lowrey writes today about Cindy Paoletti of Salina, New York, part of the recent surge in the long-term unemployed, a problem that's far, far more pronounced in this recession than it has been in past ones. "Of the 15 million unemployed in America," she reports, "over 7 million have been out of work for more than six months, nearly 5 million for a year and over 1 million for two years — the worst statistics since the government started keeping count in 1948." Despite this, legislation to extend unemployment benefits is stalled in the Senate. Matt Yglesias comments:

It’d probably be more expensive to mount a real jobs program — like a program where you show up somewhere and they give you a job — than to simply keep extending UI, but it’d be better to establish something for folks who’ve been out of a job for over a year where we actually employ them doing something. We should give Paoletti money, and we should also give her something to do. It just can’t be that there’s absolutely nothing of public use that could be done in-or-around Salina, New York.

Pundits like us don't really have an obligation to produce detailed white papers as the price of entry for criticizing public policy. Still, I can't help but feel that a case like this requires something. Sure, there's probably a job somewhere around Salina for Paoletti. But what we'd really need are public jobs for all 5 million of the people who have been unemployed for over a year. I'm just not sure what that would look like, and I'd like to hear at least a remotely plausible scenario for creating quick, useful public jobs on that kind of scale in a sluggish economy before I insist that there must be a way to do it.

It's not as if this is a brand new problem, after all. We've had a vast industry dedicated to finding work for welfare recipients and the unemployed for decades. So we have a pretty good idea of what the shape of the river is. And we haven't found an answer yet. It's possible that throwing a lot more money at it would do the job, but I doubt it. If consumer demand isn't there, it isn't there.

Which of course is the problem. Matt has argued tirelessly for an economic policy that spends less time worrying about nonexistent inflation worries and more time spending federal dollars to boost demand and close the output gap. And that's the thing to argue for. If we're not willing to do that, though, count me as skeptical that the federal government can somehow create public works projects for 5 million people. I'm certainly willing to change my mind if someone out there has done the serious, detailed work to show that it's more plausible than I think, but I haven't really seen that yet.

How Long in Afghanistan?

| Thu Jun. 10, 2010 11:38 AM EDT

I've been meaning to write an Afghanistan post that brings together a few related worrisome threads — including this one, which I'm still trying to digest and make sense of — but that'll have to be for another time. For now, here's this:

The top U.S. commander in Afghanistan said Thursday that major parts of the military operation to secure Kandahar, the birthplace of the Taliban movement, would be pushed back because it was taking longer than expected to win local support.

....McChrystal said it was taking longer than anticipated to gain the blessing of local tribal leaders — and Kandaharis in general — for the operation. He also said commanders needed more time to ensure that Afghan government could step in after the fighting stops and provide effective public services, something that has been lacking in Kandahar for years.

....Asked whether he considered the Kandahar delay a setback in the Afgan war, Anders Fogh Rasmussen, the NATO secretary general, said the difficulties were actually an indication of progress in the overall war effort. "I foresee a very tough time in the coming weeks and months, because we are now targeting what I call the Taliban heartland in Helmand and Kandahar," he said at a news conference.

In one sense, this is fine: at least we're not getting happy talk or five o'clock follies. Things aren't going as well as we'd like and McChrystal and Rasmussen are willing to fess up to this.

At the same time, this is pretty obviously an effort to prepare the ground for staying in Afghanistan longer than we'd like. Probably a lot longer. Remember this conversation from Jon Alter's The Promise?

Inside the Oval Office, Obama asked Petraeus, "David, tell me now. I want you to be honest with me. You can do this in 18 months?"

"Sir, I'm confident we can train and hand over to the ANA [Afghan National Army] in that time frame," Petraeus replied.

"Good. No problem," the president said. "If you can't do the things you say you can in 18 months, then no one is going to suggest we stay, right?"

"Yes, sir, in agreement," Petraeus said.

Last month I said, "Promise or not, I'll bet that next year, when the drawdown is supposed to start, Petraeus tells us we need to stay." It sure sounds to me as if McChrystal is starting the PR campaign for this now. And if there's anything the Pentagon has gotten good at in the Petraeus era, it's mounting a PR campaign.

California Ragin'?

| Wed Jun. 9, 2010 11:14 PM EDT

One of the initiatives approved by Californians yesterday was Proposition 14, which eliminates separate party primaries. From now on, everyone will compete instead in a single big primary, with the two top vote-getters advancing to the general election regardless of whether or not they come from different parties. Jesse McKinley of the New York Times explains what happened:

Whether the measure will empower more independent voters — who were already allowed to vote in Democratic or Republican primaries, provided they requested a ballot — remains to be seen. But what did seem certain was that California was again poised to capture the mood of the country, just as it did in 1978 with Proposition 13, which distilled widespread antitax sentiment into a cap on property taxes.

This time, it is the anger of the electorate that Californians have bottled, experts said, even if they are not totally sure what they are doing. “I don’t know that people really knew what they were voting for,” said Bruce Cain, director of the University of California Washington Center, based in the District of Columbia.

Mr. Cain said the state of the state — high unemployment, record foreclosures and a palpable anger at legislators — had primed the pump. “When people get mad,” he said, “they lash out.”

Italics mine. Now, this piece is labeled "news analysis," so a bit of opinion-mongering is OK. But still: where does this stuff come from? Prop 14 was billed as a measure that would produce more moderate candidates. It was endorsed by most of the state's big newspapers, it was supported by Arnold Schwarzenegger, and it was heavily favored by the state's business community (which apparently thinks that "moderates" are more likely to be pro-business). It won by the epic margin of 54-46.

So what prompts McKinley to suggest that its passage was the result of voter rage? Aside from the fact that apparently Bruce Cain couldn't think of anything more substantive to say about it when McKinley called, nothing. It's just a handy hook because everyone knows — everyone! — that voters these days are enraged, so if something passes that must be the reason.

Well, who knows? Maybe that was the reason. We don't think much of our politicians, it's true. But I have to say that I didn't notice any special rage surrounding the Prop 14 campaign, and I haven't seen any polls suggesting that Prop 14 won because mobs of frenzied moderates took to the streets. It won because, of the whopping 20% of California's registered voters that cared enough one way or the other to cast a ballot, a whopping 300,000 more liked the idea than didn't. That doesn't sound especially angry to me.

A Government of Children?

| Wed Jun. 9, 2010 3:25 PM EDT

Responding to my lament last night that the failure of climate change legislation shows that we have "a government of children," Matt Steinglass demurs: "As far as I can see, that's not the problem. The children seem to be obsessed with reducing CO2 emissions. If they were running the joint, we'd be doing fine. The problem is the grown-ups. We suck." He makes a surprisingly strong case! Sorry about that, kids.

"The Lone Republican"

| Wed Jun. 9, 2010 2:03 PM EDT

Ezra Klein on Lindsey Graham's decision to abandon the climate bill he helped write:

It's further evidence that the "lone Republican" strategy doesn't work. Time and again, Democrats have ended up in a room with a single Republican who seemed willing to cut a deal. It was Olympia Snowe on health care, Bob Corker on financial regulation and Lindsey Graham on climate change. In every case, the final bill looked a lot like what that Republican helped negotiate. And in every single case, the Republican realized that he or she couldn't get more support from their party and so they eventually bolted the effort.

If you think this has all been a cynical strategy, it's been brilliantly successful. On the one hand, Republicans have had a major role in shaping these bills. On the other hand, they haven't had to vote for these bills, and so they could cleanly campaign against legislation that a member of their party helped write. And as an added bonus, Democrats are stuck trying to defend a bill that their base doesn't like very much and that's thick with compromises that annoy political elites.

I don't know if it's all been a cynical strategy or not, but it's worth noting that it hasn't been brilliantly successful. Healthcare passed. Financial reform looks set to pass. Climate legislation won't, but let's face it: that's as much due to lack of support from centrist midwest Democrats as it is to lack of support from Republicans.

Now, the Republican strategy does seem to have energized their base and will probably lead to big wins in November and gridlock down the road. The lesson Republicans are likely to take away from this is that obstructionism works and America is a tea party country after all. Hooray! But in fact, most of this has been baked into the cake for a long time simply due to lousy economic conditions. It's going to take the GOP a few more years in the wilderness to figure out just how wrong they are.

UPDATE: For more on Lindsey Graham's fairly bizarre turnaround on global warming, check out Kate Sheppard's interview with him today. "It's not a stretch to say that what goes into the air is contributing to global warming," Graham said, "but I don't want to be in the camp that says I know people in Northern Virginia will never see snow." And then it gets weirder. Maybe Sarah Palin has gotten hold of his brain?

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Are You a Deficit Poser?

| Wed Jun. 9, 2010 1:32 PM EDT

Over at TNR, William Galston continues his recent conversation about just how much fiscal stimulus the United States can afford, and concludes that it's hard to say. We certainly shouldn't terminate basic safety net protections during a brutal recession, he says, but beyond that there's some limit to how much we can run up the federal debt and we just don't know for sure what that limit is. Fair enough. Then this:

What matters most is making a credible commitment — through binding legislation that changes both programs and budget procedures — to alter our long-term fiscal course before our debt enters the red zone (where federal debt closes in on GDP). I can only hope that the report of the president’s fiscal commission, due out in December, sets the stage for the national discussion we have evaded for far too long. This discussion will test our capacity to govern ourselves wisely, and the whole world will be watching.

Well, I recommend that the world avert its eyes now, because our capacity to govern ourselves wisely is in pretty short supply right now. The basic problem, as about a million pundits have pointed out before, is that most of the things we talk about will have only a small long-term effect on federal spending. We could raise taxes a bit, cut a few programs here and there, resolve to fight fewer wars, and fix Social Security, and that would all be great. It would have a genuinely positive effect. But it's a drop in the ocean compared to healthcare costs. If we don't rein those in, they'll swamp everything else.

But what are the odds of that? The recent healthcare reform bill made a start on holding down spending, but it was a pretty small start and generated massive opposition anyway. In the near term, then, there's simply no chance of making a credible commitment to seriously reduce the growth rate of healthcare costs. But this is the subject that separates the posers from the real players. Forget Social Security, which is a smallish problem and an easily solved one. That's mostly good for demagogues. Healthcare spending is the 800 pound gorilla. Solve that, and you've solved our long-term spending problem. Ignore it, and you don't.

Taxes and the Rich, Take Two

| Wed Jun. 9, 2010 12:54 PM EDT

Yesterday I pondered the question of why most Americans, who aren't rich themselves, are generally unsympathetic to increased taxes on the rich. Today, Robert Waldmann takes me to the woodshed:

The answer is that Americans are sympathetic to higher taxes on the rich, as has been demonstrated by every poll on the question in the past two decades....Kevin Drum and Felix Salmon ignore not only massive evidence but also my many posts pointing to that massive evidence. My feelings are hurt. Not to boast, but just to boast, I have actually corresponded by e-mail with Drum and by some kind of instant messenger with Salmon.

Italics mine. In my defense, I thought about mentioning this in my post yesterday. But then, for some reason, I didn't. I'm not sure why, to tell the truth. In any case, here is Robert's most frequently cited evidence from Gallup:

I've condensed the full report, but basically it shows that large majorities have felt that upper-income taxes are too low since at least 1992 — though that majority has dropped considerably during that time (from 77% in 1992 to 60% in 2009). It's also worth noting that essentially nobody thinks that they, personally, are paying too little federal income tax.

Still, there you have it. Soaking the rich isn't the electoral loser I made it out to be. So then the question becomes: why is Congress unable to reform the estate tax, which affects only the very tippy top of the super rich? Why are negotiations over the carried interest loophole, which affects only zillionaire hedge fund managers, retreating from 100% repeal to 75% repeal to 65% repeal? The answer, of course, lies primarily in the ideology of the Republican Party, aided and abetted by the ideology of "centrist" Democrats, which is strong enough to overcome public sentiment.

So then, how about this question instead: Americans apparently are sympathetic to higher taxes on the rich, but equally apparently, they don't really care very much about it. They don't care enough, anyway, to sway their elected representatives much. How come?

Numbers are Tricky

| Wed Jun. 9, 2010 12:07 PM EDT

There's been a bit of blogospheric back-and-forth recently on the issue of social spending in the United States vs. the Nordic countries. I haven't followed it closely, but basically Price Fishback argues that the U.S. is better than you think on this score, while Lane Kenworthy, after taking a closer look at the data, says we aren't after all. This isn't really surprising, but via Matt Yglesias, I just want to highlight this one paragraph from Kenworthy:

[Fishback] cautions, though, that “One advantage the poor Americans would have had in spending their disposable income is that they face consumption tax rates in the 4 to 7 percent range, while consumption taxes in the Nordic countries are above 20 percent.” Actually, consumption tax rates are incorporated in the purchasing power parities (PPPs) used to convert incomes to a common currency, so these income figures already adjust for differences in consumption taxes.

Italics mine. I don't have any point to make about the generosity of America's safety net here, just about the trickiness of international data comparisons. You'd have to be pretty knowledgable about this stuff to realize that consumption taxes are already accounted for when you look at comparisons of disposable spending in different countries, and if you didn't know that you'd derive an entirely incorrect conclusion about how much disposable income people in different countries really have. What's more, I'll bet there are some calculations where consumption taxes aren't taken into account, and you'd better know that too.

This is mostly a note to myself to be careful in the future with this kind of thing. But these kinds of notes usually work better if you take the time to actually write them down, and they work even better still if you make them public so that people can mock you if you ever get sloppy and fail to apply proper care. Consider that done.

POSTSCRIPT: By the way, Kenworthy's post is worth reading if you're interested in the subject at hand. He's a genuine expert who does know how to properly read the data, and you'll be unsurprised to learn that, in fact, the United States tends to be pretty stingy on the social welfare front.

Watch the Bouncing Ball

| Wed Jun. 9, 2010 11:44 AM EDT

The quadrennial festival of kvetching about the new World Cup ball is in full force again this year, but the LA Times reports that this time the kvetchers might have more of a point than usual:

"It's very weird," Brazilian striker Luis Fabiano said. "All of a sudden it changes trajectory on you. It's like it doesn't want to be kicked … like someone is guiding it.... It's supernatural."

Teammate Julio Cesar was more succinct. "It's horrible," the Brazilian goalkeeper said...."It moves around so much ... this ball can go anywhere," said Marcus Hahnemann, the backup U.S. goalkeeper. "You can't judge it. And it's taking the skill away from the game.... You can't pinpoint a pass anymore."

...."The ball's terrible," U.S. goalkeeper Tim Howard said. "You're going to hear that now, you're going to hear that next week and next month."

This sounds great! I can hardly wait until some pipsqueak team like, say, the United States, ends up beating Argentina on a bizarre fluke play where the ball suddenly starts acting like Sean White on a halfpipe and dives into the net a full body length away from the astonished goalie. Sounds like great TV.