“Addicted To The Apocalypse”: Scaremongers Can’t Bring Themselves To Let Go
Once upon a time, walking around shouting “The end is nigh” got you labeled a kook, someone not to be taken seriously. These days, however, all the best people go around warning of looming disaster. In fact, you more or less have to subscribe to fantasies of fiscal apocalypse to be considered respectable.
And I do mean fantasies. Washington has spent the past three-plus years in terror of a debt crisis that keeps not happening, and, in fact, can’t happen to a country like the United States, which has its own currency and borrows in that currency. Yet the scaremongers can’t bring themselves to let go.
Consider, for example, Stanley Druckenmiller, the billionaire investor, who has lately made a splash with warnings about the burden of our entitlement programs. (Gee, why hasn’t anyone else thought of making that point?) He could talk about the problems we may face a decade or two down the road. But, no. He seems to feel that he must warn about the looming threat of a financial crisis worse than 2008.
Or consider the deficit-scold organization Fix the Debt, led by the omnipresent Alan Simpson and Erskine Bowles. It was, I suppose, predictable that Fix the Debt would respond to the latest budget deal with a press release trying to shift the focus to its favorite subject. But the organization wasn’t content with declaring that America’s long-run budget issues remain unresolved, which is true. It had to warn that “continuing to delay confronting our debt is letting a fire burn that could get out of control at any moment.”
As I’ve already suggested, there are two remarkable things about this kind of doomsaying. One is that the doomsayers haven’t rethought their premises despite being wrong again and again — perhaps because the news media continue to treat them with immense respect. The other is that as far as I can tell nobody, and I mean nobody, in the looming-apocalypse camp has tried to explain exactly how the predicted disaster would actually work.
On the Chicken Little aspect: It’s actually awesome, in a way, to realize how long cries of looming disaster have filled our airwaves and op-ed pages. For example, I just reread an op-ed article by Alan Greenspan in The Wall Street Journal, warning that our budget deficit will lead to soaring inflation and interest rates. What about the reality of low inflation and low rates? That, he declares in the article, is “regrettable, because it is fostering a sense of complacency.”
It’s curious how readily people who normally revere the wisdom of markets declare the markets all wrong when they fail to panic the way they’re supposed to. But the really striking thing at this point is the date: Mr. Greenspan’s article was published in June 2010, almost three and a half years ago — and both inflation and interest rates remain low.
So has the ex-Maestro reconsidered his views after having been so wrong for so long? Not a bit. His new (and pretty bad) book declares that “the bias toward unconstrained deficit spending is our top domestic economic problem.”
Meanwhile, about that oft-prophesied, never-arriving debt crisis: In Senate testimony more than two and half years ago, Mr. Bowles warned that we were likely to face a fiscal crisis within around two years, and he urged his listeners to “just stop for a minute and think about what happens” if “our bankers in Asia” stop buying our debt. But has he, or anyone in his camp, actually tried to think through what would happen? No, not really. They just assume that it would cause soaring interest rates and economic collapse, when both theory and evidence suggest otherwise.
Don’t believe me? Look at Japan, a country that, like America, has its own currency and borrows in that currency, and has much higher debt relative to G.D.P. than we do. Since taking office, Prime Minister Shinzo Abe has, in effect, engineered exactly the kind of loss of confidence the debt worriers fear — that is, he has persuaded investors that deflation is over and inflation lies ahead, which reduces the attractiveness of Japanese bonds. And the effects on the Japanese economy have been entirely positive! Interest rates are still low, because people expect the Bank of Japan (the equivalent of our Federal Reserve) to keep them low; the yen has fallen, which is a good thing, because it make Japanese exports more competitive. And Japanese economic growth has actually accelerated.
Why, then, should we fear a debt apocalypse here? Surely, you may think, someone in the debt-apocalypse community has offered a clear explanation. But nobody has.
So the next time you see some serious-looking man in a suit declaring that we’re teetering on the precipice of fiscal doom, don’t be afraid. He and his friends have been wrong about everything so far, and they literally have no idea what they’re talking about.
By: Paul Krugman, Op-Ed Columnist, The New York Times, October 24, 2013
“Raising The Medicare Age”: A Terrible Republican Idea Exposed As Even More Terrible
Yesterday, the Congressional Budget Office came out with a report assessing the budgetary impact of something many conservatives have supported, raising the Medicare eligibility age from 65 to 67. What they found was that the change would save far less money than had previously been assumed: only $19 billion over the next decade. The main reason is that many of the people no longer eligible for Medicare would be eligible for either Medicaid or insurance subsidies through the health exchanges, so the net effect on the federal budget would be small.
But more important than that, this is an opportunity to remind ourselves that when government is doing something worthwhile, doing less of it isn’t a good idea even if it saved a lot of money. And if cutting back only saves a modest amount of money, it’s a really bad idea. You know what else would save a lot of money? Eliminating the United States Navy. But I’m guessing that most conservatives think having a navy is a good thing. Medicare is a spectacular success, one of the greatest things this country has ever done. Letting fewer people get on it is like the Miami Heat saying, “We won the championship last year, so what we need to do now is get rid of LeBron James.”
Don’t forget, Medicare is more efficient and less expensive than private insurance. Let me repeat that: Medicare is more efficient and less expensive than private insurance. It costs less to administer, its costs have risen more slowly than those of private insurance, and its beneficiaries love it. I realize that these facts cause many conservatives to begin blinking rapidly as their brains threaten overload from the cognitive dissonance produced when they realize that there are places where a government program outperforms its private-sector counterparts. But it’s true.
Yes, Medicare’s costs are projected to rise greatly in the coming decades. But that isn’t because the program doesn’t work, it’s because of the high cost of health care in general, and because there are going to be a lot more old people. And not incidentally, there was one piece of legislation that found ways to save hundreds of billions of dollars from Medicare’s future expenses. It was called the Affordable Care Act, and you may remember that Republicans didn’t think too highly of it. In fact, they even pretended to be terribly opposed to those very savings, falsely characterizing them as cuts to benefits. But instead they’d like to just make the program available to fewer seniors?
If you don’t let people get on Medicare when they’re 65, it isn’t as though they’ll just step into their suspended animation pods for two years and then pop out when they turn 67. Those people will have to get coverage from private insurers. That means they’ll be paying more out of their own pockets. And look, I realize that many conservatives believe that someone getting health insurance from the government is an inherently bad thing, no matter how well the program works. But it isn’t. When a senior goes on Medicare, it’s something to be celebrated. It isn’t free, but it’s government doing exactly what it ought to do.
By: Paul Waldman, Contributing Editor, The American Prospect, October 25, 2013
“Giving The Rich Even More Influence”: More Money Coming To An Election Near You
After the 2010 Citizens United ruling, which allowed corporations and unions to overwhelm federal elections with unlimited “independent” expenditures, the courts began overturning reasonable state-specific campaign finance rules — in Montana, for instance. Now it is New York’s turn.
A federal appeals court panel on Thursday said New York State’s long standing $150,000 cap on contributions to independent political groups was probably unconstitutional. The ruling came less than two weeks before New York City’s mayoral election on Nov.5. It might be too late for wealthy conservative groups to gin up support for Republican Joe Lhota in his uphill battle against Democrat Bill de Blasio. But the ruling could have a significant impact on elections starting next year.
New York State already has extremely lax campaign financing laws which allow unlimited donations to political parties for “housekeeping” purposes. Other contribution limits are scandalously high and some crafty donors have even found a way around those by creating multiple limited liability corporations that can each give the maximum to a candidate. For example, one real estate developer, Leonard Litwin, has used this dodge to contribute hundreds of thousands of dollars to Governor Andrew Cuomo’s campaigns.
New York’s Attorney General Eric Schneiderman will have to decide whether to appeal the decision. But he and others have suggested that there are possible alternatives.
He has argued that if the courts keep getting rid of the ceilings on contributions, one good option for New York State would be to raise the floor. By that he means that Albany’s politicians should create a public campaign financing system much like the one in New York City
For more almost 25 years, New York City has enjoyed the best and fairest campaign financing operation in the country. Candidates receive $6 in public funds for every $1 in contributions up to $175 per person. That matching system means more people can afford to run for office. Donors who write small checks know they can make a bigger difference. And voters have more choices, which might be the reason too many state legislators really oppose this way forward.
States that suddenly find big money flooding into their local elections could also fight back by demanding to know who’s writing those checks.
Shaun McCutcheon, who is at the center of a Supreme Court case challenging limits on campaign donations, issued a statement Thursday that said he is “very pleased that another court has decided to rule in favor of free speech.”
Actually it ruled in favor of giving the rich more influence than they already have over who wins public elections.
By: Eleanor Randolph, Editors Blog, The New York Times, October 25, 2013
“GOP Roots For Failure”: With Disturbing Frequency, Republicans Wish For Disaster On “The American People”
In theory, lawmakers should hope that government programs work well, and if they don’t, work to fix them. Elected representatives should hope that government agencies carry out their missions smoothly, and if something goes wrong, try to figure out what happened to avoid making the same mistake in the future.
Obviously that’s not how things work in the United States, where one of the two parties doesn’t actually believe in government. Republicans want to shrink government until it’s small enough to drown in a bathtub! They think there’s nothing scarier than the prospect of a government employee trying to help! With beliefs like those, it’s perhaps not surprising that — with disturbing frequency — they root for failure in order to score points.
Examples abound. After the attack in Benghazi, G.O.P. lawmakers were far more interested in laying blame and making the Obama administration look bad than in improving security for diplomats. In the midst of the I.R.S. scandal — which turned out not to be much of a scandal at all — Republicans seemed positively gleeful.
Which brings me to today’s House hearing on the bumpy rollout of the federal health insurance marketplace.
The rollout is bumpy, and inexcusably so. It appears that the federal exchange Web site wasn’t fully tested until two weeks before it opened. As today’s Times story put it, the online health insurance marketplace “is still limping along after three weeks.”
Lawmakers can and should hold the administration to account. But given that House Republicans have done everything in their power to try to dismantle the Affordable Care Act — including shutting down the entire government — it’s understandable that House Democrats expressed suspicion about their motives.
“I wish I could believe that this hearing is above board, but it’s not,” said Representative Frank Pallone, Democrat of New Jersey. “The Republicans don’t have clean hands coming here. Their effort is obviously not to make this better, but to use the website glitches as an excuse to defund or repeal Obamacare.”
Taking the same line, Representative Henry Waxman, Democrat of California, said: “We have already documented a record of Republicans attempting to sabotage the Affordable Care Act.” He added, “If we want this law to work, we have to make this right; we’ve got to fix it. Not what the Republicans are trying to do: nix it and repeal it.”
Although some Republicans asked valid and thoughtful questions of the private contractors who’d come to testify, others seemed to prove Mr. Pallone and Mr. Waxman right.
Representative Joe Pitts, Republican of Pennsylvania, took the opportunity to say he would seek a delay in the individual mandate—exactly what Republicans wanted before there was any word of trouble with the online exchanges. Healthcare.gov is “nothing less than an unmitigated disaster,” Mr. Pitts said. He also wondered aloud if the people behind it were “simply incompetent” or else “lying to the American people.”
“If the Web site glitches are just the tip of the iceberg,” said Representative Greg Walden, Republican of Oregon, “it’s only a matter of time before the law sinks and takes with it those Democrats who wrote it, voted for it and are proud of it.”
Breaking that down: If the glitches indicate deep problems, then health care reform will fall apart, and Republicans will reap the benefits in the next election. In other words, disaster would be good for his party.
By: Juliet Lapidos, Editors Blog, The New York Times, October 24, 2013
“We Got ‘Em Now”: No, Healthcare.gov’s Problems Will Not Offer The GOP Political Deliverance
Today marks the beginning of what will surely be a series of hearings in Congress at which members will fulminate and shake their fists at various people who had responsibility for creating Healthcare.gov. It’s quite something to see some congressman who’s still struggling to figure out how to work the Blackberry his staff gave him asking questions about beta testing and error logs and a bunch of other stuff he doesn’t begin to understand. But maybe the weirdest thing is the feeling one gets from the GOP over the last few days, which can be summarized as, “We got ’em now!” They seem to believe that the website problems are going to provide the deliverance they’ve been waiting for after the political disaster of the government shutdown.
Here’s a little prediction: Feigned Republican outrage over the ACA web site is going to be just as effective in reversing the GOP’s current fortunes as feigned Republican outrage over Benghazi was in undoing Barack Obama’s re-election bid.
Nevertheless, they’ve got a new spring in their step, as The New York Times reports today. “If the Web site glitches are just the tip of the iceberg,” says Representative Greg Walden, who as chair of the National Republican Congressional Committee is responsible for making sure his party holds the House in 2014, “it’s only a matter of time before the law sinks and takes with it those Democrats who wrote it, voted for it and are proud of it.” All they have to do is sit back and wait for Obamacare to implode, then reap the political benefits.
I wouldn’t get too excited if I were them. First of all, if you’re arguing about why the website isn’t working, you’ve implicitly accepted the premise that the website ought to work, so people can use it and get insurance. Which is quite different from arguing, as some Republicans have, that people who are now uninsured just shouldn’t bother getting insurance at all. When you stand before the cameras to shout, “I will not rest until these problems are fixed and Obamacare works properly!” and you then turn around and say, “I will not rest until Obamacare is destroyed!”, you’re not exactly convincing the voting public that you’re the one they want running things.
Furthermore, as Greg Sargent reminds us, “when it comes to supplying genuine oversight, previous House GOP probes — into Benghazi and the IRS scandal – devolved into circus stunts. Those investigations got knocked off kilter by lurid and fanciful charges that seemed directed at a hard right audience that remains firmly in the grip of the conservative closed information feedback loop.” In today’s Republican party, efforts at embarrassing the Obama administration quickly get taken over by the the party’s tin foil hat brigade, and even the sane ones end up playing to Sean Hannity’s audience instead of to the country as a whole.
If you’re a Republican member of Congress, this is coming at a critical time, because it’s around now when your potential primary opponents are deciding whether they want to run against you in next year’s election. That gives you an incentive to prove to the folks back home that you’re as conservative as the nuttiest Tea Partier. It isn’t hard to do, really—all that’s necessary is to go on television and tell the Fox News host that you’re deeply concerned that Healthcare.gov was intentionally made to work improperly as a pretext for the socialist Obama administration to collect all our DNA to facilitate herding us into FEMA concentration camps (or something like that). Which helps make your primary challenge less likely, but doesn’t serve the party’s larger purpose of convincing the American public that the GOP is not, in fact, a party of extremists who don’t care about governing.
Hearings like these seldom produce any useful information, but if they increase the pressure on the administration to get things fixed quickly, then that’s all to the good. But if I were a Republican, I wouldn’t get too excited about what they’re going to do for my party.
By: Paul Waldman, Contributing Editro, The American Prospect, October 24, 2013
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