Blogs | Mother Jones Mother Jones logo en Lunchtime Photo <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Here's a morning glory with a busy little bee inside. Actually, two bees, I guess. Isn't it nice to see everyone doing the job nature has assigned them?</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_lunchtime_morning_glory_bee.jpg" style="border: 1px solid #000000; margin: 15px 0px 0px 0px;" width="630"></p></body></html> Kevin Drum Thu, 25 May 2017 19:30:06 +0000 Kevin Drum 333716 at Appeals Court Upholds Ban on Travel Ban <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>An appeals court has <a href="" target="_blank">upheld the injunction on President Trump's travel ban:</a></p> <blockquote> <p>Trump's order "speaks with vague words of national security, but in context drips with religious intolerance, animus and discrimination," Chief Judge Roger L. Gregory of the 4th Circuit Court of Appeals wrote in his ruling.</p> <p>The 10-3 ruling relied heavily, as other courts have done, on Trump's statements during his campaign in which he called for a ban on Muslims immigrating to the United States. The plaintiffs who have challenged the travel order have argued that it is a disguised version of the Muslim ban that he called for during the campaign.</p> </blockquote> <p>Please note that this comes from the centrist 4th circuit, not the radical lefty zealots of the 9th circuit. The vote was 10-3. And the opinion was written by a guy who was appointed by Bill Clinton and re-appointed by George W. Bush.</p></body></html> Kevin Drum Thu, 25 May 2017 18:41:50 +0000 Kevin Drum 333796 at Let's Drop the Hysterics About Trump and NATO's Article 5 <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Is Donald Trump committed to NATO? Here's what the press says about that today:</p> <blockquote> <p><a href="" target="_blank">New York Times:</a> "President Trump on Thursday once again refused to explicitly endorse NATO&rsquo;s mutual defense pledge, instead lecturing European leaders on what he called their 'chronic underpayments' to the military alliance."</p> <p><a href="" target="_blank">Wall Street Journal:</a> "Mr. Trump&rsquo;s refusal to say he supports NATO&rsquo;s common defense provision, known as Article 5, left European diplomats dismayed."</p> <p><a href="" target="_blank">The Washington Post:</a> "Trump refuses to back NATO Article 5." (This is from memory. It was something like that.)</p> </blockquote> <p>The <em>Washington Post</em> quickly realized it was practicing pack journalism and rewrote their story. It doesn't even mention Article 5 anymore.</p> <p>As well it shouldn't. At today's unveiling of an Article 5 memorial at NATO headquarters, Trump said this about the aftermath of 9/11: "Our NATO allies responded swiftly and decisively, invoking for the first time in its history the Article 5 collective defense commitments." Later he added: "This twisted mass of metal reminds us not only of what we have lost but also what forever endures: the courage of our people, the strength of our resolve, and the commitments that bind us together as one. We will never forget the lives that were lost, we will never forsake the friends who stood by our side."</p> <p>It's true that Trump didn't explictly say "We stand behind Article 5," but it's hard to read his comments any other way. Within a few minutes Sean Spicer confirmed this:</p> <blockquote class="twitter-tweet tw-align-center" data-lang="en"> <p dir="ltr" lang="en">Spicer says Trump wasn't trying to be cute at NATO, the U.S. is 100% committed to Article 5 - per <a href="">@JenniferJJacobs</a></p> &mdash; Justin Sink (@justinsink) <a href="">May 25, 2017</a></blockquote> <script async src="//" charset="utf-8"></script><p>Everyone needs to calm down. Sure, Trump probably <em>was</em> trying to be cute. Alternatively, the failure to repeat our commitment to Article 5 might have been yet another example of Trump's ham-handed approach to negotiation, trying to create leverage for more defense spending by making everyone in Europe nervous. Or it could be nothing more than Trump's familiar resolve never to back down: If they want him to say he's committed to Article 5, then that's the one thing he <em>won't</em> say. (He also insisted on doubling down on his much-mocked description of terrorists as "losers," for example.) Or maybe Trump is just being a dick. He wants attention, and this is a way to get it.</p> <p>Still, he was clear enough, and his press secretary was as explicit as he could be afterward. What's more, before the speech his Secretary of State said without qualification, "Of course we support Article 5." Campaign bluster aside, there's really no indication that the Trump administration is any less committed to NATO than previous administrations. Here's the whole speech:</p> <p><iframe align="middle" allowfullscreen="" frameborder="0" height="354" src="" style="margin: 15px 0px 0px 0px;" width="630"></iframe></p></body></html> Kevin Drum Thu, 25 May 2017 18:16:34 +0000 Kevin Drum 333781 at The Intel Community Needs to Fire Someone—Fast <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>The US intelligence community has screwed up. Someone (or multiple someones) passed along British intel about the Manchester bombing to US reporters before it had been publicly released. This is bad for at least three reasons:</p> <ul><li>It quite possibly impedes an active investigation.</li> <li>It pisses off British intelligence.</li> <li>It gives Donald Trump a very reasonable excuse to <a href="" target="_blank">demand an investigation</a> into leaking from our intelligence agencies.</li> </ul><p>This is a bit like the reporters who fail to verify their stories properly and end up making mistakes. It might not happen very often, but it gives Trump ammunition for his claims that the media is out to get him with endless fake news. For that reason, reporters in the age of Trump need to be doubly careful about what they write.</p> <p>If the intel community is smart, it will figure out where these leaks came from and fire someone fast. But are they smart?</p> <p><strong>UPDATE:</strong> I'm using "intel community" in a very broad sense here since we don't know where the leak came from. It includes the FBI, which recent reporting has suggested is the most likely culprit.</p></body></html> Kevin Drum Thu, 25 May 2017 17:04:17 +0000 Kevin Drum 333761 at CBO Agrees: Trumpcare Wipes Out Protections for Pre-Existing Conditions <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p><a href="" target="_blank">Earlier this month</a> I passed along a note from Matthew Fiedler of the Brookings Institution. Long story short, he suggested that the Republican health care bill would do more than eliminate community rating only for folks who failed to maintain continuous coverage.<sup>1</sup> He theorized that once a separate set of rates was set up, insurers could open it up to anyone. Since this second rate schedule would be medically underwritten&mdash;i.e., based on health status&mdash;it would be very cheap for young, healthy folks. In the end, healthy consumers would all gravitate to the medically-underwritten rates while unhealthy consumers would be stuck with the higher community-rated prices. Over time, the difference between these rates would grow, which means that anyone with a pre-existing condition would end up paying much higher rates than similar healthy people.</p> <p>This was an interesting suggestion, but since then I haven't heard anyone else support Fiedler's argument. Until today, that is. AHCA allows states to apply for waivers from two provisions of Obamacare. The first is the requirement to provide essential health benefits. The Congressional Budget Office <a href="" target="_blank">describes the other waiver:</a></p> <blockquote> <p>A second type of waiver would allow insurers to set premiums on the basis of an individual&rsquo;s health status if the person had not demonstrated continuous coverage; that is, <strong>the waiver would eliminate the requirement for what is termed community rating for premiums charged to such people.</strong> CBO and JCT anticipate that most healthy people...would be able to choose between premiums based on their own expected health care costs (medically underwritten premiums) and premiums based on the average health care costs...(community-rated premiums).</p> <p>....CBO and JCT expect that, as a consequence, the waivers in those states would have another effect: Community-rated premiums would rise over time, <strong>and people who are less healthy (including those with preexisting or newly acquired medical conditions) would ultimately be unable to purchase comprehensive nongroup health insurance at premiums comparable to those under current law,</strong> if they could purchase it at all....<strong>As a result, the nongroup markets in those states would become unstable for people with higher-than-average expected health care costs.</strong></p> </blockquote> <p>So the CBO expects precisely the result that Fiedler predicted. This is genuinely big news and deserves wider reporting. For all practical purposes, AHCA eliminates the requirement that insurers charge the same rates to everyone, even those with pre-existing conditions. They still can't flatly turn you down, but they can do the next best thing: make insurance so expensive for those with pre-existing conditions that most people can't afford it. That's especially harmful since the subsidies under AHCA are so skimpy.</p> <p>This provision of AHCA has no direct budgetary impact, so it ought to get tossed out by the Senate parliamentarian.<sup>2</sup> We'll have to wait and see how that turns out.</p> <p><sup>1</sup>"Community rating" is the requirement that everyone pays the same price for insurance, even if they have a pre-existing condition.</p> <p><sup>2</sup>AHCA is being passed as a reconciliation bill. These bills are only allowed to address issues that directly affect the federal budget.</p></body></html> Kevin Drum Thu, 25 May 2017 16:13:17 +0000 Kevin Drum 333751 at Obamacare Is Pretty Stable — Unless Republicans Cripple It <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>The CSR subsidies that President Trump keeps threatening to kill are pretty important:</p> <blockquote class="twitter-tweet tw-align-center" data-lang="en"> <p dir="ltr" lang="en">Blue Cross and Blue Shield of North Carolina seeks 22.9% rate increase on 2018 ACA plans &ndash; would be 8.8% if cost-sharing payments guaranteed</p> &mdash; Anna Mathews (@annawmathews) <a href="">May 25, 2017</a></blockquote> <script async src="//" charset="utf-8"></script><p>Here in California, our insurance commissioner has asked all health insurers for <a href="" target="_blank">two sets of rate hike requests:</a> one that assumes the CSR subsidies continue and one that assumes they don't. We won't get the rate requests for several weeks, but I expect that we'll see the same kind of difference. At a guess, average rate increase requests will be around 6 percent with CSR and 15 percent without.</p> <p>Just to be crystal clear about this: What this means is that if Republicans stop screwing around with CSR, rate hikes nationwide would probably be in the 5-10 percent range, which is fairly normal. It also shows that the market has started to stabilize after last year's big increases. The only reason we're likely to see another year of big increases is because of a deliberate campaign to undermine the Obamacare market by Republicans.</p></body></html> Kevin Drum Thu, 25 May 2017 15:02:55 +0000 Kevin Drum 333731 at Greg Gianforte Is Surprisingly Sensitive About the CBO's Score of AHCA <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Greg Gianforte is running for the House seat in Montana left open when Ryan Zinke was named Secretary of the Interior. It turns out he really, really doesn't like being asked what he thinks of the CBO's score of the Republican health care bill:</p> <p><iframe align="middle" allowfullscreen="" frameborder="0" height="354" src="" style="margin: 15px 0px 15px 0px;" width="630"></iframe></p> <p>For more on this bizarre incident, <a href="" target="_blank">read Tim Murphy's story</a>.</p></body></html> Kevin Drum Thu, 25 May 2017 00:27:33 +0000 Kevin Drum 333711 at Chart of the Day: Here's How Many People Lose Insurance Under AHCA <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>This really needs no explanation:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_ahca_vs_obamacare_uninsured_2.gif" style="border: 1px solid #cccccc; margin: 15px 0px 0px 0px;" width="630"></p></body></html> Kevin Drum Thu, 25 May 2017 00:15:07 +0000 Kevin Drum 333706 at Meet New AHCA, Same as Old AHCA <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>The long awaited <a href="" target="_blank">CBO score of the new Republican health care bill</a> is out! You're excited, aren't you? Without further ado, here's the CBO's key chart showing how much better new AHCA is than old AHCA:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_old_ahca_new_ahca_1.gif" style="border: 1px solid #000000; margin: 15px 0px 15px 0px;" width="630"></p> <p>As you can see, under old AHCA the number of poor with no insurance rose from 15-20 percent under Obamacare to 30-40 percent under AHCA. But under <em>new</em> AHCA, it's more like 29-39 percent. Hot diggity! Here are a few other numbers:</p> <ul><li>Old AHCA reduced the deficit by $150 billion (over ten years). New AHCA reduces the deficit by $119 billion.</li> <li>Old AHCA took away insurance from 24 million people (by 2026). New AHCA takes it away from 23 million.</li> <li>Old AHCA cut Medicaid by $839 billion (over ten years). New AHCA cuts Medicaid by $834 billion.</li> <li>Under old AHCA, a low-income 64-year-old paid an annual premium of $14,600. Under new AHCA, the premium is $16,100. On the bright side, states that take advantage of new AHCA's permission to gut essential benefits can get that all the way down to $13,600. This compares to $1,700 under Obamacare.</li> </ul><p>Those are some mighty big changes, aren't they? You can certainly understand why the (former) head of the Republican "moderate" caucus worked so hard to revive AHCA and make these adjustments. It's like a whole new bill.</p></body></html> Kevin Drum Wed, 24 May 2017 22:23:10 +0000 Kevin Drum 333691 at Lunchtime Photo <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>This is my neighborhood a little after sunrise. Marian loves this picture and insisted that I put it up. I took it several weeks ago, and I can't remember quite why I was up and about at such an ungodly hour.</p> <p>You can't see our house, however. As I recall, the houses on the water cost about a third more than the houses that backed up to the main street, so we bought a house that backed up to the main street. This used to be something of a pain, because the dog people walked their dogs early in the morning right outside our bedroom window, and their dogs would all bark at each other when they passed by. For some reason that stopped a few years ago. Perhaps there was some big community meeting where the dog people and the late risers had it out once and for all. If so, I was blissfully unaware of the whole thing. Whatever the reason, it's pretty quiet these days except when the crows start squawking. I don't know what has them so upset lately, but they've sure been making a racket for the past couple of weeks.</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_lunchtime_lakeside_morning_0.jpg" style="border: 1px solid #000000; margin: 15px 0px 0px 0px;" width="630"></p></body></html> Kevin Drum Wed, 24 May 2017 19:30:05 +0000 Kevin Drum 333491 at Housing Prices Are Booming in Southern California <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p><a href="" target="_blank">From the <em>LA Times</em> today:</a></p> <blockquote> <p>The median home price in Los Angeles County <strong>has reached the all-time high set in 2007,</strong> a milestone that follows five years of steady recovery but comes amid renewed concerns over housing affordability. Home prices rose nearly 6% in April from a year earlier, hitting the $550,000 level where the median plateaued in summer 2007 before a sharp decline that bottomed out in 2012.</p> <p>....<strong>Orange County surpassed its pre-bust high last year,</strong> and in April set a new record of $675,000. <strong>San Diego County also exceeded its pre-bust peak for the first time last month,</strong> as the median price &mdash; the point at which half the homes sold for more and half for less &mdash; climbed 7.4% to $525,000.</p> </blockquote> <p>Inflation has risen 20 percent since 2007, so this means home prices in Southern California haven't really set a record. They're still 20 percent away from that. Here's how CoreLogic scores the current housing market compared to its bubble peak:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_corelogic_housing_2006_2017.jpg" style="border: 1px solid #000000; margin: 15px 0px 15px 0px;" width="630"></p> <p>So things look OK. Loan delinquencies are low, credit scores have remained high, and national housing prices are high but not stratospheric.</p> <p>And yet...Southern California, Arizona, and Florida are all overvalued. That's three out of the four states that led the bubble in 2006. Even Texas, which avoided the last bubble, is looking high. And anecdotally, homes are selling pretty fast around here.</p> <p>This is the kind of thing that makes me think we might be back into a recession by 2018. The expansion is nine years old, unemployment is about as low as it can get, housing prices are increasing at a good clip, auto sales are anemic, and corporate profits are rising steeply. On the other side of the ledger, economic growth and wage growth are pretty modest, and there are no signs of an oil price spike around the corner.</p> <p>I dunno. Things just feel a little fragile right now. But maybe I'm off base.</p></body></html> Kevin Drum Wed, 24 May 2017 19:22:12 +0000 Kevin Drum 333601 at Donald Trump Really Likes to Drop Military Secrets Into His Conversations <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>A couple of days ago <em>The Intercept</em> released a <a href="" target="_blank">leaked transcript</a> of President Trump's recent phone call with President Duterte of the Philippines. Here's a piece of it:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_trump_submarines.jpg" style="border: 1px solid #000000; margin: 15px 0px 15px 0px;" width="630"></p> <p><em>BuzzFeed's</em> Nancy Youssef got some feedback about this from <a href="" target="_blank">folks in the Pentagon:</a></p> <blockquote> <p>Pentagon officials are in shock after the release of a transcript between President Donald Trump and his Philippines counterpart reveals that the US military had moved two nuclear submarines towards North Korea. <strong>&ldquo;We never talk about subs!&rdquo;</strong> three officials told <em>BuzzFeed News</em>, referring to the military's belief that keeping submarines' movement stealth is key to their mission.</p> <p>....By announcing the presence of nuclear submarines, the president, some Pentagon officials privately explained, gives away the element of surprise &mdash; an irony given his repeated declarations during the campaign that the US announces far too many of its military plans when it comes to combatting ISIS.</p> <p>Moreover, some countries in the region, particularly China, seek to develop their anti-sub capability. <strong>Knowing that two US submarines are in the region could allow them to test their own military capabilities.</strong></p> </blockquote> <p>Needless to say, Trump wasn't expecting that his conversation would be leaked. But these things happen&mdash;along with other ways that private conversations can end up in the wrong hands&mdash;which is why presidents don't just casually drop military secrets into meetings with foreigners for no better reason than to make themselves look tough. This is now (at least) the second time Trump has done this, and there's a price to pay:</p> <blockquote class="twitter-tweet tw-align-center" data-cards="hidden" data-lang="en"> <p dir="ltr" lang="en">1/2 Why Trump&rsquo;s &ldquo;we&rsquo;ve sent the subs!&rdquo; gaffe can be so damaging:<br> Now that CN/RUS *know* US subs were there, can go back &amp; calibrate sensors. <a href=""></a></p> &mdash; James Fallows (@JamesFallows) <a href="">May 24, 2017</a></blockquote> <script async src="//" charset="utf-8"></script><blockquote class="twitter-tweet tw-align-center" data-cards="hidden" data-conversation="none" data-lang="en"> <p dir="ltr" lang="en">2/2 &ldquo;This is how it looked when subs were there; we&rsquo;ll look for that pattern again.&rdquo;<br> N Yousef story <a href=""></a></p> &mdash; James Fallows (@JamesFallows) <a href="">May 24, 2017</a></blockquote> <script async src="//" charset="utf-8"></script><p>We're quickly reaching the point where intelligence agencies, both foreign and domestic, are going to start withholding information from Trump because they don't trust him to keep his yap shut. We might already be there, for all I know.</p></body></html> Kevin Drum Wed, 24 May 2017 18:12:22 +0000 Kevin Drum 333551 at Productivity Is the Key to Economic Growth <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Mick Mulvaney says the haters <a href="" target="_blank">don't know what they're talking about:</a></p> <blockquote> <p>In his remarks Tuesday, Mulvaney mentioned that the economy had often grown in the past at rates of 3 percent and called people's objections to the Trump administration's expectation of growth rates that high "absurd."</p> <p>"It used to be normal. Ten years ago, it was normal. <strong>In fact, it's been normal for the history of the country,</strong>" said Mulvaney.</p> </blockquote> <p>Mulvaney is sort of right about this. But there's more to it. The basic formula for economic growth is simple: Economic growth = Population growth + Productivity growth. Population growth has been slowing down for decades, and Mulvaney isn't going to change that. We know exactly what the population of the country is going to be over the next few years.</p> <p>So that leaves productivity growth, which the BLS estimates <a href="" target="_blank">here.</a> Here's what all three factors have looked like since 1960:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_economic_growth_1973_2021.gif" style="border: 1px solid #cccccc; margin: 15px 0px 15px 0px;" width="630"></p> <p>In order to achieve 3 percent economic growth, we need productivity growth of about 2.3 percent. This is decidedly not normal for the history of the country&mdash;not in the past 50 years, anyway. With the brief exception of the unsustainable housing bubble era, we haven't hit that since the end of 60s.</p> <p>Productivity growth is a real problem, and it's something of a mystery why it's been so low lately. But it's a mystery to Mulvaney too, and it's certainly not due to punitive tax rates or heavy-handed regulations. Despite this, Mulvaney is suggesting that Trump can more than double the productivity growth rate of the past ten years, reaching a target we haven't hit in a normal, healthy economy for the past half century. There's simply no reason to believe this, and Mulvaney hasn't even tried to explain how he thinks Trump can accomplish it. Not even hand waving. He's literally said nothing about productivity growth at all.</p> <p>Until he does, nobody should believe his growth estimates. It all comes down to productivity, and that's what Mulvaney needs to talk about.</p></body></html> Kevin Drum Wed, 24 May 2017 16:42:48 +0000 Kevin Drum 333521 at Corporate America Is Doing Great <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>If you're wondering why the stock market is doing so well lately, <a href="" target="_blank">here's the answer:</a></p> <blockquote> <p><strong>Earnings at U.S. companies grew at the fastest pace in nearly six years in the first quarter,</strong> the latest boon to a bull market that has stretched into its ninth year.</p> <p>With nearly all companies in the S&amp;P 500 having reported results, <strong>aggregate earnings for the first quarter are on track to grow 13.6% from the year-earlier period</strong>....Beyond the jump in growth, many investors have been encouraged by signs that the quality of the results is improving. That contrasts with recent years, when investors worried that corporate share buybacks and ultralow interest rates were juicing stock gains in the absence of business improvement.</p> </blockquote> <p>It's not Trumpmania, it's just old-fashioned earnings growth. More people are buying stuff and companies are making more money. It's simple.</p> <p>How long will this last? I don't know any more than anyone else, but my guess is that the current expansion has another year to go. I'm starting to see signs of an economy that's getting a little too exuberant, and I suspect that 2018 is going to be a mild recession year. Please note that this prediction is worth every cent you paid for it.</p></body></html> Kevin Drum Wed, 24 May 2017 15:44:49 +0000 Kevin Drum 333526 at Health Care Systems Are Expensive. Deal With It. <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>How much would a single-payer universal health care system cost in the United States? You don't need to do anything very complicated to get a ballpark figure. Here's the arithmetic:</p> <ul><li>Total spending on health care in the US is <strong>$3.2 trillion</strong></li> <li>Of that, $1.5 trillion is already funded by federal and state programs. That leaves additional required spending of <strong>$1.7 trillion.</strong></li> <li>A universal system will still require some copays and other out-of pocket expenses. Figure $200 billion or so. That leaves <strong>$1.5 trillion</strong></li> </ul><p>So that's it. A universal health care system in the US would require about $1.5 trillion in additional government spending. If you want to make heroic assumptions about how much a single-payer would save, go ahead. But nobody serious is going to buy it. If we're lucky, a good single-payer system would slow the growth of health care costs over the long term, but it's vanishingly unlikely to actually cut current costs.</p> <p>There was a lot of surprise today about an estimate that a single-payer plan for California would have a <a href="" target="_blank">net additional cost of about $200 billion.</a> But California has 12 percent of the nation's population, and 12 percent of $1.5 trillion is $180 billion. So that estimate is right in the ballpark of what you should expect. Short of some kind of legislative miracle, there's really no way around this. Health care is expensive.</p></body></html> Kevin Drum Wed, 24 May 2017 04:52:51 +0000 Kevin Drum 333496 at Budget Crankery For Geeks: Real Nonresidential Fixed Investment Edition <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>If you want to read about President Trump's just-released budget, the rest of the news media has you covered. They have articles about cuts to food stamps, cuts to the border wall, cuts to the NIH, cuts to health research, cuts to Medicaid, cuts to the State Department, cuts to the EPA, trillions and trillions in cuts all over the place, and explainers about why 3 percent growth projections are ridiculous. Here's the tl;dr version: Trump's budget proposes huge cuts in spending on the poor along with preposterous assumptions about how much revenue they'll raise. The details really don't matter much since no one in Congress will read it. It's just a statement of Trump's callous guiding values.</p> <p>So I'm mostly going to skip the whole thing unless someone points out something especially amusing. And someone has! Section 2 of the <a href="" target="_blank">budget document</a> is titled, "What went wrong: Inheriting $20 trillion in debt and a broken, stagnant economy." Sure enough, it contains page upon page of woe. That Obummer dude sure did screw up the economy something fierce.</p> <p>However, a reader emails to point out something he thinks I'd appreciate: "Note the cherry picking of dates going on around pages 6 and 7 of the just-released Trump budget. Just as do the climate 'skeptics,' the authors of the Trump budget document pick inconsistent starting dates when they calculate growth rates of various things in order to get the good or bad results they desire. The best, perhaps, is the growth rate for real private nonresidential fixed investment."</p> <p>Hmmm. Real private nonresidential fixed investment, you say? Here's what the budget document says:</p> <blockquote> <p>Due to high taxes, high regulations, and poor economic policies, <strong>real private nonresidential fixed investment has grown by only 1.3 percent each year</strong> (on a fourth quarter-over-fourth quarter basis) since 2007, <strong>compared to 4.9 percent annually before the recession.</strong></p> </blockquote> <p>Yikes! That sucks. Is it true? I admit that I can't quite replicate their numbers, but let's call it close enough for government work. It's pretty nearly correct.</p> <p>Of course, it only works if you start precisely at 2007 so that you include the big drop from the recession. Here's what it looks like over the longer term:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_nonresidential_investment_1999_2017.gif" style="border: 1px solid #cccccc; margin: 15px 0px 15px 0px;" width="630"></p> <p>It doesn't really look all that different anymore, does it? In fact, since the Bush-era growth rate caused a massive property bubble and subsequent massive crash, we might well prefer a wee bit less growth than we had before 2007.</p> <p>I suppose it says something disturbing about me that I find this kind of technocratic lying with statistics more interesting than a thousand words about how the cuts to food stamps will hurt the poor. Then again, if you made it this far, it probably says something disturbing about you, too. In any case, I figure this is my comparative advantage. Everyone is writing about food stamps, but who else will point out the obscure but telling lies like this?</p></body></html> Kevin Drum Tue, 23 May 2017 22:16:49 +0000 Kevin Drum 333461 at Lunchtime Photo <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Remember that Canada Goose nest <a href="" target="_blank">I showed you a while back?</a> It came to a sad end, unfortunately. I'm not sure what happened, exactly, but it was abandoned shortly before the eggs would have hatched.</p> <p>But there are other Canada Geese around, and they've had better luck. Here's a pair of goslings trying to catch a quick nap after a tiring day of pecking away at the grass looking for bugs. <em>[<strong>UPDATE:</strong> According to Rob Mac in comments, they aren't looking for bugs, they're just eating the grass.]</em> Aren't they adorable? Mom and Dad are keeping a close eye on the kids below.</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_lunchtime_canada_goose_goslings_sleeping.jpg" style="border: 1px solid #000000; margin: 15px 0px 0px 0px;" width="630"><img align="middle" alt="" class="image image-_original" src="/files/blog_lunchtime_canada_goose_parents.jpg" style="border: 1px solid #000000; margin: 15px 0px 0px 0px;" width="630"></p></body></html> Kevin Drum Tue, 23 May 2017 19:30:05 +0000 Kevin Drum 333416 at Brennan: CIA Was Original Source of Trump-Russia Investigation <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>How did the FBI's investigation into the Trump-Russia connection get started, anyway? Former CIA director John Brennan says <a href="" target="_blank">he was the one who got the ball rolling:</a></p> <blockquote> <p>&ldquo;<strong>I encountered . . . intelligence that revealed contacts and interactions between Russian officials and U.S. persons involved in the Trump campaign,</strong>&rdquo; Brennan said, adding that he did not see conclusive evidence of collusion but feared that Trump associates were wittingly or unwittingly being used to advance the interests of Moscow.</p> <p>....Brennan testified that he was disturbed by intelligence that surfaced last year showing a pattern of contacts between Russian agents or representatives and people with links to the Trump campaign. <strong>&ldquo;That raised concerns in my mind,&rdquo;</strong> Brennan said....With that remark, Brennan appeared to identify the point of origin of the FBI investigation that began in July &mdash; the first time a U.S. official has provided insight into what prompted the bureau probe.</p> </blockquote> <p>That's from the <em>Washington Post</em>. Brennan was testifying before Congress about Russian interference in the 2016 election, <a href="" target="_blank">and the <em>New York Times</em> adds this disheartening tidbit:</a></p> <blockquote> <p>On Aug. 4, as evidence of that campaign mounted, Mr. Brennan warned Alexander Bortnikov, the director of Russia&rsquo;s Federal Security Service, known as the F.S.B., not to meddle in the election. Not only would interference damage relations between the two countries, he said, it was certain to backfire.</p> <p><strong>&ldquo;I said that all Americans, regardless of political affiliation or whom they might support in the election, cherish their ability to elect their own leaders without outside interference or disruption,&rdquo;</strong> Mr. Brennan said. &ldquo;I said American voters would be outraged by any Russian attempt to interfere in election.&rdquo;</p> <p><strong>Mr. Brennan&rsquo;s warning proved futile.</strong> Though intelligence agencies are unanimous in their belief that Russia directly interfered with the election, <strong>it has become a divisive partisan issue, with Democrats far more likely than Republicans to accept the conclusion.</strong> President Trump has declared that &ldquo;Russia is fake news&rdquo; and tried to undermine the conclusions of his own intelligence services.</p> </blockquote> <p>I don't blame Brennan for thinking that Russian interference in the election would outrage everyone regardless of party. I suppose I might have thought the same thing. But it ain't so anymore:</p> <blockquote class="twitter-tweet tw-align-center" data-lang="en"> <p dir="ltr" lang="en">At Trump-Russia hearing with John Brennan, Republicans focus mostly on protecting Trump. <a href=""></a></p> &mdash; David Corn (@DavidCornDC) <a href="">May 23, 2017</a></blockquote> <script async src="//" charset="utf-8"></script><p>As always, click the link for the whole story.</p></body></html> Kevin Drum Tue, 23 May 2017 18:51:53 +0000 Kevin Drum 333436 at How Should We Respond to the Turkish Assault in Washington DC? <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Last week, a bunch of security goons working for Turkish president Recep Tayyip Erdogan waded into a demonstration outside the Turkish embassy in Washington DC and started beating up the protesters. A few days ago, the <em>Washington Post's</em> Philip Bump made a <a href="" target="_blank">pretty good case</a> that Erdogan did more than just watch as this happened. He actually ordered his guards to attack. <a href="" target="_blank">Rich Lowry has the right response:</a></p> <blockquote> <p>This is second offense for the Turks. A year ago, they beat up protesters and disfavored journalists outside an Erdogan talk at the Brookings Institution in Washington. One reporter wrote of that earlier incident, &ldquo;Never seen anything like this.&rdquo; If you hang around President Erdogan long enough, though, you&rsquo;ll see it all.</p> <p>....The Trump administration is obviously not putting an emphasis on promoting our values abroad. But it&rsquo;s one thing not to go on a democratizing crusade; it&rsquo;s another to shrug off an assault on the rights of protesters on our own soil. If nothing else, President Donald Trump&rsquo;s nationalism and sense of honor should be offended. Not only did the Turks carry out this attack, they are thumbing their noses at us by summoning our ambassador over it.</p> <p>The Turkish goons who punched and kicked people should be identified and charged with crimes. They are beyond our reach, either because they are back in Turkey or have diplomatic immunity. But we should ask for them to be returned and for their immunity to be waived. When these requests are inevitably refused, the Turkish ambassador to the U.S. (heard saying during the incident, &ldquo;You cannot touch us&rdquo;) should be expelled.</p> </blockquote> <p>It's obvious that Turkey is a delicate problem. On the one hand, they're a NATO member, and their location makes them a critical player in the war against ISIS. On the other hand, Erdogan is steadily converting Turkey into a totalitarian state. In the real world, sometimes you overlook this because you need allies and you don't always have the option of choosing someone who's pure and unsullied. But even if you accept this, Turkey is on thin ice since the Kurds are also our allies and Turkey interferes pretty seriously with our ability to team up with them. Even from a strictly realist/strategic perspective, our alliance with Turkey comes with a price.</p> <p>I won't pretend to have the answer. It's above my pay grade. But ordering your embassy security to attack protesters <em>in the US</em> who are lawfully and peacefully assembled is a whole different thing. That deserves a strong response even if it might cause strategic tension. Enough's enough.</p></body></html> Kevin Drum Tue, 23 May 2017 17:27:11 +0000 Kevin Drum 333411 at BREAKING: Trump Budget Numbers Make No Sense <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Jon Chait says the Trump White House has <a href="" target="_blank">made a $2 trillion mistake:</a></p> <blockquote> <p>Trump has promised to enact &ldquo;the biggest tax cut in history.&rdquo; Trump&rsquo;s administration has insisted, however, that the largest tax cut in history will not reduce revenue, because it will unleash growth....But then the budget assumes $2 trillion in higher revenue from growth in order to achieve balance after ten years. So the $2 trillion from higher growth is a double-count. It pays for the Trump cuts, and then it pays again for balancing the budget.</p> </blockquote> <p>It's true that the <a href="" target="_blank">budget summary document</a> includes a line item called "Effect of economic feedback" (in Table S-2) that comes to $2.062 trillion over ten years. Is that the same as the economic feedback that will pay for tax cuts? Who knows, really. It's all just made-up nonsense anyway. But here's an interesting thing. In the detailed projections, the <a href="" target="_blank">Trump budget</a> projects <em>lower</em> tax revenue than the final <a href="" target="_blank">Obama budget:</a></p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_tax_receipts_obama_trump_2014_2021.gif" style="border: 1px solid #cccccc; margin: 15px 0px 15px 0px;" width="630"></p> <p>What's up with that? Does the Trump budget not include any economic feedback after all? But even if it doesn't, why is their projection lower than Obama's? Is it so they can use this lower number as a new baseline for comparison when they unveil their growth-exploding tax plan later in the year?</p> <p>I know, I know: who cares? The Trump numbers are just random gibberish plucked from the sky. Still, you'd think they could at least make them agree from one spreadsheet to the next. Where's the economic feedback in the tax revenue numbers?</p></body></html> Kevin Drum Tue, 23 May 2017 16:52:00 +0000 Kevin Drum 333401 at Mulvaney: Trump's Promise Not to Cut Medicaid Has Been "Overridden" <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Over at the <em>Weekly Standard</em>, Michael Warren interviews <a href="" target="_blank">budget chief Mick Mulvaney:</a></p> <blockquote> <p>If a budget proposal is a message about priorities, it's clear entitlement reform isn't even on President Trump's radar. When starting on 2018 budget proposal, Mulvaney came to the president with a one-page list of entitlement programs to reform.</p> <p>"We went down the list: Yes, Yes, No, No, Yes, No, Yes, No, No," said Mulvaney. "The nos were <strong>all Social Security and Medicare.</strong> And that's it. He said, '<strong>I promised people on the campaign trail I would not touch their retirement and I would not touch Medicare, and we owe it to them.</strong>'"</p> </blockquote> <p>That's quite a trick memory Trump has. He actually promised not to touch Social Security, Medicare, <em>and Medicaid</em>. But he seems to have forgotten all about that last one. What happened?</p> <blockquote class="twitter-tweet tw-align-center" data-lang="en"> <p dir="ltr" lang="en">at briefing today, Mulvaney told me Trump promise not to touch Medicaid had been overridden by Trump promise to repeal/replace Obamacare <a href=""></a></p> &mdash; John Harwood (@JohnJHarwood) <a href="">May 23, 2017</a></blockquote> <script async src="//" charset="utf-8"></script><p>Oh.</p></body></html> Kevin Drum Tue, 23 May 2017 15:31:20 +0000 Kevin Drum 333391 at Lead and Crime in Popular Culture <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>Well, this is a kick in the gut. In tonight's season finale of <em>Supergirl</em>, the good guys unearth a weapon originally designed by Lex Luthor as a way of encouraging Superman to self-deport himself by irradiating the atmosphere with kryptonite. At the moment, however, the threat to Earth is from Daxamites, whose weakness isn't kryptonite, but lead:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_supergirl_1.jpg" style="border: 1px solid #000000; margin: 15px 0px 0px 0px;" width="310"><img align="middle" alt="" class="image image-_original" src="/files/blog_supergirl_2.jpg" style="border: 1px solid #000000; margin: 15px 0px 0px 6px;" width="310"></p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_supergirl_3b.jpg" style="border: 1px solid #000000; margin: 0px 0px 0px 0px;" width="310"><img align="middle" alt="" class="image image-_original" src="/files/blog_supergirl_4.jpg" style="border: 1px solid #000000; margin: 0px 0px 0px 6px;" width="310"></p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_supergirl_5.jpg" style="border: 1px solid #000000; margin: 0px 0px 0px 0px;" width="630"></p> <p>At least Superman has the good sense to look unhappy about this. On the bright side, if irradiating the atmosphere with lead ends up causing more crime, that's a sort of job security for him, isn't it?</p></body></html> Kevin Drum Tue, 23 May 2017 06:46:42 +0000 Kevin Drum 333361 at Trump Asked the NSA and DNI to Repudiate the Russia Investigation <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>According to the <em>Washington Post</em>, James Comey wasn't the only person that President Trump pressured <a href="" target="_blank">regarding the FBI's Russia investigation:</a></p> <blockquote> <p>Trump made separate appeals to the director of national intelligence, Daniel Coats, and to Adm. Michael S. Rogers, the director of the National Security Agency, <strong>urging them to publicly deny the existence of any evidence of collusion during the 2016 election.</strong></p> <p>Coats and Rogers refused to comply with the requests, which they both deemed to be inappropriate, according to two current and two former officials, who spoke on the condition of anonymity to discuss private communications with the president....Trump&rsquo;s conversation with Rogers was documented contemporaneously in an internal memo written by a senior NSA official, according to the officials. It is unclear if a similar memo was prepared by the Office of the Director of National Intelligence to document Trump&rsquo;s conversation with Coats.</p> <p>....In addition to the requests to Coats and Rogers, <strong>senior White House officials sounded out top intelligence officials about the possibility of intervening directly with Comey to encourage the FBI to drop its probe of Michael Flynn</strong>....&ldquo;Can we ask him to shut down the investigation? Are you able to assist in this matter?&rdquo; one official said of the line of questioning from the White House.</p> </blockquote> <p>This. Is. Nuts. Trump is not only corrupt, he's an unbelievable moron. He <em>personally</em> asked the NSA director and the overall director of national intelligence to publicly weigh in on an ongoing investigation. Not only that, he basically asked them to lie, since they weren't privy to what the FBI was doing. In what universe did Trump think that either of them would respond positively to such a blunt request? Or that this kind of thing wouldn't leak?</p> <p>What's more, in addition to directly asking Comey to shut down the FBI investigation, he apparently had some of his aides call senior intelligence officers to ask them to intervene with Comey. There are two big questions here:</p> <ul><li>What is Trump afraid the investigation will find? Whatever it is, apparently <a href="" target="_blank">Michael Flynn is afraid of it too.</a></li> <li>When do the impeachment proceedings begin?</li> </ul><p>If there really are contemporaneous memos from Comey, Rogers, and maybe Coats, and if all three can be called to testify about their conversations with Trump, then what more do we need? This is Nixon-level stuff.</p></body></html> Kevin Drum Mon, 22 May 2017 23:22:11 +0000 Kevin Drum 333336 at What's the Best Way to Measure Inflation? <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>This post is long and wonky and probably not worth your time to read. You have been warned! But it's something I've been wrestling with for a while, and this is basically a way of getting my thoughts in order so that I can continue pondering it.</p> <p>The subject is inflation. Specifically, what's the best way to measure inflation? I'm talking here about the best <em>general</em> index, not specialized things like CPI-X (an attempt to measure inflation for the elderly) or core PCE (useful to the Fed as a way of judging the strength of the economy). The most common measure of inflation is the Consumer Price Index (CPI), and that's what you see in the headlines each month when the BLS reports a new inflation number.</p> <p>But CPI has its problems, and lots of people prefer the Personal Consumption Expenditure index (PCE). Scott Winship has led the charge on this, and you can read a <a href="" target="_blank">pretty readable explanation of his views here.</a> Long story short, Winship makes a good case for the problems with CPI, but I'm not thrilled with PCE either. I'm usually interested in measuring the lived experience of people&mdash;especially the non-rich&mdash;and in my opinion <a href="" target="_blank">PCE uses a weighting system that obscures this.</a></p> <p>So what's the best index? First off, there are plenty of times when it doesn't matter. Here's a chart showing CPI and PCE over the last ten years:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_cpi_pce_2006_2016.gif" style="border: 1px solid #cccccc; margin: 15px 0px 15px 0px;" width="630"></p> <p>They're nearly identical. If you're comparing something to last year, or even to ten years ago, just go ahead and use CPI. It doesn't really make any difference. Here's a comparison over 20 years:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_cpi_pce_1996_2016.gif" style="border: 1px solid #cccccc; margin: 15px 0px 15px 0px;" width="630"></p> <p>There's a little more difference, but still not that much. Obviously this difference might be important in an academic or professional economic setting, but for everyday journalistic use, you can use CPI for a comparison of anything between a year and 20 years ago. It's going to be fine.</p> <p>But what if you want to go back further? Here are both indexes going back to 1978:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_cpi_pce_1978_2016.gif" style="border: 1px solid #cccccc; margin: 15px 0px 15px 0px;" width="630"></p> <p>Now we're up to a difference of 21 percent. That's enough to really matter. Luckily, the BLS has created a series called CPI-U-RS that's become pretty popular. I like it because it seems to hit the right sweet spot between fixing the problems with CPI but retaining better weightings than PCE. In terms of the actual things that people use and buy, I think that CPI-U-RS is probably the best measure we have.</p> <p>Unfortunately, it only goes back to 1978. However, before then there's only a tiny difference between CPI and PCE. Here they are from 1929 to the present:</p> <p><img align="middle" alt="" class="image image-_original" src="/files/blog_cpi_pce_1929_2016_1.gif" style="border: 1px solid #cccccc; margin: 15px 0px 15px 0px;" width="630"></p> <p>So the best index to use is PCE (indexed to 1978=104) from 1929-1977 and CPI-U-RS from 1978-present. It would be nice if BLS would merge the two series and give the result a snazzy name like CPI-A1, but they don't. Until then we'll just have to <a href="" target="_blank">home brew it ourselves.</a></p></body></html> Kevin Drum Mon, 22 May 2017 22:55:30 +0000 Kevin Drum 333321 at Trump Learns that Arabs Want a Palestinian Peace Deal <!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" ""> <html><body><p>In some ways, it's sort of entertaining to have a president who's literally learning the most basic facts of the world <a href="" target="_blank">on the job:</a></p> <blockquote> <p>President Trump began a two-day visit to Israel on Monday with a blunt assessment for Prime Minister Benjamin Netanyahu: If Israel really wants peace with its Arab neighbors, <strong>the cost will be resolving the generations-old standoff with the Palestinians</strong>....&ldquo;I was deeply encouraged by my conversations with Muslim world leaders in Saudi Arabia, including King Salman, who I spoke to at great length. King Salman feels very strongly and, I can tell you, would love to see peace with Israel and the Palestinians.&rdquo;</p> </blockquote> <p>It's an open question whether a Palestinian peace deal would really produce comity with the rest of the Arab world, but it's certainly a prerequisite and has been for decades. But I guess Trump hadn't really considered that a serious obstacle until he heard it face-to-face from the king.</p> <p>Anyway, we all know where this is going, right? Benjamin Netanyahu wants to stay on good terms with Trump, and Trump wants a peace deal. Everyone on the planet knows perfectly well that Netanyahu has no interest in this, but he'll string Trump along anyway. A "peace process" will be set up, Jared Kushner will preside over a meeting or two, and Netanyahu will settle back and wait for some kind of bombing or other terror attack to declare that he tried but the Palestinians just can't be dealt with. Every neocon in America will immediately jump on the bandwagon and insist that this is the final straw. Things were so hopeful thanks to Trump's goodwill, but they bombed innocent women and children while Israel was earnestly trying to make peace! They're savages! Netanyahu will ask Trump for a statement of support, and of course Trump will provide it because terrorists are bad. And that will be that.</p> <p>The whole thing will be a ridiculous charade, and everyone except Trump will know it.</p></body></html> Kevin Drum Mon, 22 May 2017 21:22:53 +0000 Kevin Drum 333311 at