Kevin Drum

Delaying Guantanamo

| Tue Jul. 21, 2009 11:48 AM EDT

The latest on Guantanamo:

Obama administration officials said Monday they would not meet self-imposed deadlines for deciding what to do with scores of detainees too dangerous to release from the prison in Guantanamo Bay, Cuba.

....The officials said they had made substantial progress in reviewing the cases of the approximately 240 prisoners at the facility, and had decided that dozens of detainees were eligible for transfer to other countries or were suitable for trial.

But the officials acknowledged that two reports that were supposed to be delivered to the president by Wednesday — one on how to overhaul the nation's detention policy and another on interrogation policy — would not be ready...."We want to get this right and not have another multiple years of uncertainty," one senior administration official said in a background briefing with reporters at the White House.

Well, that's probably right.  It is a complex problem, and they do want to get it right.  But it's not really as complex as all that, and there's a far more likely explanation for the delay: after the bipartisan meltdown when this first surfaced in May, Obama realized that it's a political issue so explosive that it could easily derail his entire domestic agenda if he lets it detonate in public again. Passing healthcare reform and climate change bills will be hard enough as it is, and he's probably made a cold-blooded calculation that it's better to slow-roll Guantanamo than it is to endanger either of his centerpiece domestic initiatives.  It's not pretty, but it's politics.

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Does Independence Matter?

| Tue Jul. 21, 2009 11:08 AM EDT

Why do independent central banks (ICBs) generally produce low inflation?  Alex Tabarrok says it's because bankers tend to get appointed to run ICBs and bankers have a bias toward low inflation.  Megan McArdle says no, it's because nobody holds Congress accountable for the performance of ICBs, which gives them the freedom to appoint people who will do things they don't have the guts to do themselves.  Matt Yglesias isn't sure that the Fed is really an ICB in the first place: it was pretty clearly politicized in the 70s and produced high inflation, and it was quite likely politicized in the oughts and helped produce an economic meltdown.

These all sound like reasonable points to me, and I don't think they're mutually exclusive.  Maybe they're all right.  But I'm curious about something else: what does the academic literature say about the performance of ICBs in advanced economies in the first place?  There must be a considerable amount of research on this point.  If we take some measure of "independence" and compare that to various measures of medium-term economic performance (inflation, wage growth, GDP growth, unemployment, etc.), what do we find?  Does independence really matter very much?  Is there some specific aspect of independence that matters more than others?  Can some friendly econoblogger summarize the literature for us?

Checking In On the Rich

| Tue Jul. 21, 2009 1:51 AM EDT

The communists at the Wall Street Journal present us with the latest executive pay data today:

Executives and other highly compensated employees now receive more than one-third of all pay in the U.S.....In the five years ending in 2007, earnings for American workers rose 24%, half the 48% gain for the top-paid. The result: The top-paid represent 33% of the total, up from 28% in 2002.

....The data suggest that the payroll tax ceiling hasn't kept up with the growth in executive pay. As executive pay has increased, the percentage of wages subject to payroll taxes has shrunk, to 83% from 90% in 1982. Compensation that isn't subject to the portion of payroll tax that funds old-age benefits now represents foregone revenue of $115 billion a year.

You probably thought that the big problem with skyrocketing executive pay was the fact that it left nothing for the rest of us.  And you're right: that 24% increase for "American workers" includes the 48% increase for the top earners.  In other words, the executives got a 48% increase, the rest of us got approximately nothing, and it all averaged out to 24%.

But that's not all!  It also means that the average joes with stagnant wages couldn't keep up, so they went deeper and deeper in debt.  And who loaned them the money to do that?  Well, the rich can't really spend that ocean of extra dough they're getting — the technical reason is that they have a lower marginal propensity to consume than average joes; the nontechnical interpretation is that you can only buy just so many yachts — so they ended up loaning most of it back to the middle class.  We all know how that turned out — but the rich got bailed out by the taxpayers so they ended up OK.  The rest of us, not so much.

And now the Journal is pointing out yet another problem with running our economy solely for the benefit of the wealthy: you only owe payroll taxes on income up to $106,000.  This number rises every year, but it doesn't rise nearly as fast as the earnings of the rich.  Which means that more and more income every year is above the cutoff and doesn't get taxed.  And that in turn means that Social Security is in considerably worse shape than it would be if increases in national income weren't being hoovered up almost exclusively by the executive class.

So there you have it.  If we don't pass healthcare reform it will be because the rich don't want to help pay for it.  Average wages are stagnant because that leaves a bigger pool of money for the rich to slosh around in.  We're letting the planet fry because policies to stop it would inconvenience the rich.  Regulatory reform of the financial system increasingly appears to be a dead letter because Congress is owned by the rich and they don't want it.  Against all that, I suppose that crippling Social Security hardly even shows up in the ledger.  But we might as well tot it up anyway.

Kindle v. Kindling

| Mon Jul. 20, 2009 6:47 PM EDT

This is apropos of nothing in particular, but I thought I'd update everybody on what I think about the Kindle after a few additional months of usage.

Here's what happened: a couple of months I found myself at loose ends, book-wise.  I didn't really have anything special I wanted to read, so I started browsing around on Amazon for books I might enjoy.  I found one, but it wasn't available for the Kindle.  Then another.  And another.  Hmmph.  Then Eric Boehlert's Bloggers on the Bus came in the mail, so I read that instead.  When I was done, I wandered over to the corner of my living room that temporarily holds the stack of books publishers send me and took one off the top.  Then the next, and the next. It was kind of fun: totally random book selection.  So over the course of a few weeks I ended up reading half a dozen real books printed on real paper: Bloggers on the Bus (excellent); In Search of Jefferson's Moose (Jefferson stuff pretty good, internet stuff not so much); Intelligence and How to Get It (better than I expected); The Summer of 1787 (pretty good, though not really groundbreaking or anything); Bailout Nation (polemic, but mostly good polemic); and The Evolution of God (one of the less convincing books I've read in a while).

Then I got bored and went back to the Kindle.  This was all pretty unplanned, but what's struck me the most in my back and forth between Kindle and paper is that the Kindle is really unsatisfactory for books that have a lot of charts and tables.  The resolution is poor; columns don't line up right; captions break up halfway through; and both charts and tables can sometimes be pages and pages away from the text they're connected to.

More generally: the Kindle is bad for any book in which the actual layout of the text is important.  That's pretty obvious for something like a coffee table picture book, but it turns out to be true for nonfiction with lots of illustrations too. (I can't imagine what it's like reading In Search of Jefferson's Moose on the Kindle, for instance. Between all the charts, tables, footnotes, and callouts, it must be a real mess. If anyone's done it, let me know.)

I guess this is all pretty obvious, but a few months has driven it home more strongly.  The problem is, how do you know if a book relies on lots of illustrations?  Most fiction doesn't, of course, but a lot of nonfiction doesn't either.  But some does, and it's not always obvious from the title or subject of the book.  I suppose I could look at the table of contents on Amazon and see how long the list of figures and tables is.  That's not a perfect proxy, though, and not all books have a ToC for tables and figures anyway.  (And not all books are browsable on Amazon, either.)

Anyway, I'm not quite sure what to do about this.  Right now, for example, I'm reading A Farewell to Alms on the Kindle and it's driving me crazy.  I should be reading it on paper.  But I didn't know.  I'm not quite sure what the answer to this dilemma is.  Can the hive mind help?

POSTSCRIPT: Of course, this is all quite aside from this, which is pretty disturbing all on its own.  The future may not be quite as Kindle-riffic as I initially thought.

Peloton Madness

| Mon Jul. 20, 2009 2:33 PM EDT

I kinda sorta tried to figure out what the whole Hincapie/Garmin/Columbia/etc. contretemps this weekend at the Tour de France was about, but I eventually gave up.  Cycling is just such a stupid sport.  explains it here in case you're interested.

Still a stupid sport, though.  Especially the velodrome version.

Baghdad Update

| Mon Jul. 20, 2009 1:41 PM EDT

Four years ago, during a commemoration of the Shiite saint Imam Musa al-Kazim, a thousand pilgrims to the Al Kadhimiya Mosque in Baghdad were killed when rumors of an imminent suicide bomb attack caused a panicked stampede across a bridge.  Every year since then, the commemoration has been regularly targeted by insurgents and militias.  Until now:

President Barack Obama's withdrawal strategy for Iraq got a big bump this weekend, when the Iraqi military and police presided over massive gatherings of pilgrims from the provinces in the capital, and pulled it off with no bombings. Obama could not plausibly withdraw from Iraq unless Iraqi security forces could keep a minimum of social peace. But if they can do so, the withdrawal could go smoothly. This weekend's evidence is positive.

That's from Juan Cole, who has more over at his place, both good and bad.

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Fiscal Policy for Dummies

| Mon Jul. 20, 2009 12:51 PM EDT

Brad DeLong chides Clive Crook for opposing a second stimulus package because it would increase the federal deficit.  The problem is that Crook isn't distinguishing between short-term and long-term deficits:

But if you don't distinguish between these two — if you call them both "fiscal policy" and pretend they are the same thing, as Crook does — then you get yourself completely confused....A while ago I wrote that one of the big problems in American governance was that Washington's political class was stupider than the pigs in the Orwell novel Animal Farm. The fundamental slogan of Animalism — "four legs good, two legs bad" — is no more complicated than "cyclical deficit good, structural deficit bad," and if pigs can understand the first why can't members of congress, anchor persons, and op-ed writers understand the second?

Well....I agree with Brad, but I also don't think this is quite the mystery he makes it out to be.  The problem is both obvious and old: nobody trusts politicians.  They're eager to increase short-term deficits during recessions because that allows them to give away goodies to their constituents.  And they're perfectly happy to promise to rein things in down the road when the economy recovers.  Occasionally this even happens.  But not very often, and everyone knows it.  The world being what it is, short-term cyclical deficits have a strong tendency to turn into long-term structural deficits.  (cf. California, fucked up finances of.)

In a perfect world we'd auction off 100% of the permits in a cap-and-trade system.  In a perfect world we'd construct a healthcare system that covers everyone but makes sensible compromises about how much coverage everyone gets.  And in a perfect world we'd create whatever short-term deficits we needed during a recession because we'd all feel confident that when the emergency was over we'd dutifully reduce spending and increase taxes to create a cyclical surplus.

But this isn't a perfect world, which means that concerns about a short-term deficit spilling over into the far future are actually pretty understandable.  That doesn't mean we shouldn't do it, but it does mean that skeptics aren't being unreasonable if they ask for a credible plan in advance that insures deficits will come down in the future even in the face of monumental political pressures not to do it.  I have to admit that, given the current political environment, I'm not sure what such a plan would look like.

American Healthcare vs. American Soccer

| Mon Jul. 20, 2009 11:56 AM EDT

Over the weekend Mitch McConnell told David Gregory that "we have the finest health care in the world."  This is pretty standard Republican boilerplate, and it got me to wondering.

Has any Democrat ever said that "we have the worst health care in the world"?  Why not?  Sure, technically, you'd need to say "industrialized world" or some such, but aside from that it would be pretty accurate.  Certainly more accurate than McConnell's formulation.

So why not say it?  I can think of a few reasons.  (a) Americans don't like to hear anyone telling them they aren't the best at anything. (b) It would require politicians to explain how it is that other countries do healthcare better and cheaper than us — and Americans really, really don't like to hear that France does something better than us. (c) Since most Americans have health insurance and get adequate care, it's a tough sell. (d) Democrats agree with McConnell.

I suppose there are other possible reasons too.  But why nibble around the edges?  Republicans are willing to straight out claim that we're the best, even though there's virtually no metric in which this is even remotely the case.  It's as laughable as saying that America has the best soccer team in the world.  So why aren't we willing to stretch things a bit and flatly say that virtually every advanced country offers better healthcare than we do?  What's so hard about that?

Moby Healthcare

| Mon Jul. 20, 2009 11:16 AM EDT

On Friday I told David Corn that on odd days I was optimistic about the prospects for healthcare reform and on even days I was pessimistic.  Since it was Friday the 17th when we talked, I was optimistic.  The AMA is on our side!  The House Tri-Committee Bill is pretty good!  Hoorah!  He just laughed.  On Saturday, I was again pessimistic.  The centrists Dems are screwing everything up!  There's no way to pass a tax increase to fund it!  We're doomed!

On Sunday I was going to write about this.  But shortly after Tom Watson's epic meltdown at the end of the British Open, our power went out.  And stayed out.  It didn't come back on until 4:30 this morning.  Turns out that was mostly good news, though.  I did get to see all the golf, after all.  And the power outage spared you all some aimless musings about the politics of healthcare.  And since I had nothing else to do, I pulled Moby-Dick off the shelf and decided that dammit, I'd actually read it this time.  I haven't quite done that yet, but I'm about halfway through.

As for healthcare, I don't really know what I think.  It's an even day so I supposed I'm pessimistic.  We landed a man on the moon 40 years ago but we can't even pass a national healthcare plan?  What a screwed up country.  But check back with me tomorrow for another opinon.

Judging Sonia's Deadpan

| Sun Jul. 19, 2009 2:21 AM EDT

Hey, it's Laura. Kevin was oddly optimistic on health care reform in this week's podcast, and for David Corn's reaction alone I hope you'll listen. Also, Kevin chuckled twice. About Cheney and Canada, of all things.

Listen to Kevin and David also talk Friday about Sonia Sotomayor's excellent deadpan, secret vs. not-so-secret CIA assassinations, and the two most undercovered stories this week.

For more free Mother Jones podcasts, subscribe here, or in our iTunes store.

Laura McClure hosts podcasts, writes the MoJo Mix, and is the new media editor at Mother Jones. Read her investigative feature on lifehacking gurus in the latest issue of Mother Jones.