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« Liberal Outrage: November 2012 | Main | Liberal Outrage: January 2013 »

Liberal Outrage

Cave imminent

I guess no one should be surprised.

Yglesias:

Just last week I was trying to convince people that the administration had a new spirit of resolve on the debt ceiling question. Over the past year, I've repeatedly heard from administration officials both senior and junior that their on-the-record posture of no renewed negotiations on the debt ceiling is not a bluff. They've shown charts and graphs of how damaging they think the last standoff was to the economy, and made it a centerpiece of their story about why the recovery seemed to stall out for a while in 2011. Routinized hostage-taking was, they said, genuinely dangerous to the American economy.

But then it's emerged this week that they didn't really mean it. The debt ceiling is just another issue in the mix along with tax rates and benefit formulae and tax reform commissions and all the rest. One more pawn on the chessboard.

The problems with this are twofold. One is that their analysis about the danger of the debt ceiling is correct. Another is that by backing down after having invested time and energy in convincing people that they won't back down, the administration is going to make it much harder for themselves to be credible the next time around. There are two reasonable ways to handle the debt ceiling. One is to achieve a permanent solution as part of the resolution of the fiscal cliff. The other is to completely ignore it in the resolution of the fiscal cliff, and then have the president wage and win a total victory on a separate debt ceiling battle. Delaying the debt ceiling crisis until some time in 2015 as part of a larger bargain merely institutionalizes the idea that the debt ceiling is a bargaining chip and entrenches the idea that the president will cave.

Another area of compromise is in Social Security benefits cuts. Oh, they try to make it sound like a purely technical change to "chained CPI". But what does that really mean? Krugman:

Switching from the regular CPI to the chained CPI doesn't affect benefits immediately after retirement, which are based on your past earnings.What it does mean is that after retirement your payments grow more slowly, about 0.3 percent each year. So if you retire at 65, your income at 75 would be 3 percent less under this proposal than under current law; at 85 it would be 6 percent less; there's supposedly a bump-up in benefits for people who make it that far.

This is not good; there's no good policy reason to be doing this, because the savings won't have any significant impact on the underlying budget issues. And for many older people it would hurt. Also, the symbolism of a Democratic president cutting Social Security is pretty awful.

It's possible these are just trial balloons. Previously they floated the idea of raising the eligibility age for Medicare and backed away from it when everyone screamed. Consider this to be me adding my scream to the chorus against these latest "ideas", for whatever it's worth.


By fnord12 | December 18, 2012, 11:39 AM | Liberal Outrage | Link



Paul Krugman vs. Leeches

A play in one part.


By fnord12 | December 14, 2012, 10:41 AM | Liberal Outrage | Link



Susan Rice Withdraws

If this is just a personal decision from Rice to not want to deal with the crazy, then i totally understand. But if it's really a cave from the Dems, then it's not a good sign for the fiscal cliff and filibuster reform debates.

Filibuster reform is important here especially as it relates to cabinet appointments. I don't know when "advice and consent" turned into "requires a supermajority" but it's ridiculous to think that a president can't have the cabinet members he wants in his own administration. 41 senators shouldn't be able to block an appointment. The latest buzz is that Democrats have worked themselves down from a winning position to an unnecessary and probably worthless compromise on filibuster reform. I don't understand these people. When will they realize that while they're "negotiating", the other side is fighting?


By fnord12 | December 14, 2012, 8:25 AM | Liberal Outrage | Link



Media Bias

Joe Patrice has the rundown.


By fnord12 | December 13, 2012, 5:35 PM | Liberal Outrage | Link



As promised

Krugman on the Fed action:

So, how big a deal was yesterday's Fed announcement? Philosophically, it was pretty major; in terms of substantive policy implications, not so much...

Substantively, however, there isn't that much going on here. Basically, Bernanke is promising that the Fed won't do anything stupid -- specifically, that it won't pull an ECB, and raise rates even though the economy is still depressed and underlying inflation is still low. As it was, however, few people expected the Fed to pull an ECB in any case. That's reflected in the market reaction: rates actually rose, and expected inflation, as measured by the spread between nominal and real rates, went up only slightly.

Sorry, but this move, while it speaks well of the Fed's learning process, was not a game-changer.

And in his follow-up he brings it back to fiscal policy:

This means that the Fed is projecting elevated unemployment nine full years after the Great Recession started. And, of course, the Fed has been consistently over-optimistic.

This is an awesome failure of policy -- not solely at the Fed, of course. When I wax caustic about Very Serious People, bear this in mind. Faced with an economic crisis where textbook macroeconomics told us exactly how to respond, people of influence chose instead to obsess over budget deficits and generally punt on employment; and the result has been a huge economic and human disaster.


By fnord12 | December 13, 2012, 12:08 PM | Liberal Outrage | Link



I am perpetual. I keep the country clean.

We swear we're not an Illuminati organization, you guys.

In 2002-2003, the Bush administration put together Total Information Awareness program, which was to create a vast database that could be used for citizen surveillance. Outrage ensued, and the Bush administration found that not even lamely renaming the program Terrorism Information Awareness could stem it, so they withdrew the program. The outrage was helped along by the fact that the Democrats were in the opposition party at the time and a few of the good ones (Russ Feingold and Ron Wyden) introduced bills to halt the program, which helped make the protests legit (credit also to conservative pundit William Safire).

The program never really died, however; it just went underground. And now the Wall Street Journal has a good article about its use under the Obama administration.

Under the new rules issued in March, the National Counterterrorism Center, known as NCTC, can obtain almost any database the government collects that it says is "reasonably believed" to contain "terrorism information." The list could potentially include almost any government database, from financial forms submitted by people seeking federally backed mortgages to the health records of people who sought treatment at Veterans Administration hospitals.

The key point, though, is that there is no resistance this time.

The National Counterterrorism Center's ideas faced no similar public resistance. For one thing, the debate happened behind closed doors. In addition, unlike the Pentagon, the NCTC was created in 2004 specifically to use data to connect the dots in the fight against terrorism.

And what the article doesn't mention is that fact that the Democrats in congress will be silent about it this time around. Other than, say, Ron Paul, i don't imagine that Republicans will raise much of an objection, and the way they've been howling and moaning about every ginned up controversy since Obama took office, i don't think they'd have much credibility even if they did.

Our only hope now is that this thing they've created develops its own AI and turns on its masters.



By fnord12 | December 13, 2012, 10:59 AM | Liberal Outrage | Link



Goverment bureaucracy we won't try to get rid of

Take this with a grain of salt since one of the writers of this editorial runs a solar energy company and would surely like to see less regulation in his industry. But it does seem that the combination of sanctioned monopolies and local regulations are not helping what ought to be an obvious conversion to solar.

Solar panels have dropped in price by 80 percent in the past five years and can provide electricity at a cost that is at or below the current retail cost of grid power in 20 states, including many of the Northeast states. So why isn't there more of a push for this clean, affordable, safe and inexhaustible source of electricity?

First, the investor-owned utilities that depend on the existing system for their profits have little economic interest in promoting a technology that empowers customers to generate their own power. Second, state regulatory agencies and local governments impose burdensome permitting and siting requirements that unnecessarily raise installation costs. Today, navigating the regulatory red tape constitutes 25 percent to 30 percent of the total cost of solar installation in the United States, according to data from the National Renewable Energy Laboratory, and, as such, represents a higher percentage of the overall cost than the solar equipment itself.

In Germany, where sensible federal rules have fast-tracked and streamlined the permit process, the costs are considerably lower. It can take as little as eight days to license and install a solar system on a house in Germany. In the United States, depending on your state, the average ranges from 120 to 180 days. More than one million Germans have installed solar panels on their roofs, enough to provide close to 50 percent of the nation's power, even though Germany averages the same amount of sunlight as Alaska. Australia also has a streamlined permitting process and has solar panels on 10 percent of its homes.

We've reached the tipping point on solar panels where the ROI is clear and in a "free market" customers would be moving in that direction. The fact that increased energy from solar has benefits beyond an individual consumer's power bill ought to mean that this is an issue you would think Republicans and Democrats alike could get behind.

Here in New Jersey, PSE&G actually started doing some good things along these lines under Governor Corzine, like putting up solar panels on all their utility poles, but Christie put a stop to it. Even so, i'd rather see something that doesn't rely on the existing grid, at least exclusively. I find it very odd that people who have solar panels on their roofs still can't get power during a power outage, because all those panels do is feed back into the grid, not directly into your home. I don't see why the panels can't be designed to feed your home directly and then you draw from the grid to make up the difference when necessary.

Min and i live in a townhouse, so the whole conversation is moot for us, but we still harbor (increasingly fleeting, as we get older) dreams of building our Earthship. I probably need to adjust my thinking, but to me it's not really solar power unless you're off the grid.


By fnord12 | December 13, 2012, 10:37 AM | Liberal Outrage | Link



Good news from the Fed?

It sure seems that way to read Drum and Yglesias although both caveat their posts by saying that they'd like to see even higher inflation targets. At a minimum this might mitigate our upcoming austerity bomb (aka the erroneously named "fiscal cliff") but an even better scenario would be that this gets combined with the new stimulus program that Obama is pushing for as part of that debate.

The Fed could have done what they're doing here at any time but so far they've chosen not to. The timing sure feels like they were waiting for the election to get settled. I have to admit that if Romney had won and then the Fed did this i'd be screaming bloody murder.

I'll update this post when Krugman reacts, but i suspect he'll say "this is good but we need fiscal stimulus" which is what he's been saying all along.


By fnord12 | December 12, 2012, 1:37 PM | Liberal Outrage | Link



Kludgeocracy

The fact that Americans supposedly don't like big government but still want all the benefits of government means that we have a system that operates in a complicating and costly manner to achieve what ought to be straightforward goals.

Not sure if the obligatory dig at Windows was necessary but here you go. PDF:

The dictionary tells us that a kludge is "an ill-assorted collection of parts assembled to fulfill a particular purpose...a clumsy but temporarily effective solution to a particular fault or problem." The term comes out of the world of computer programming, where a kludge is an inelegant patch put in place to be backward compatible with the rest of a system. When you add up enough kludges, you get a very complicated program, one that is hard to understand and subject to crashes. In other words, Windows.

"Clumsy but temporarily effective" also describes much of American public policy. For any particular problem we have arrived at the most gerry-rigged, opaque and complicated response. From the mind-numbing complexity of the health care system (which has only gotten more complicated, if also more just, after the passage of Obamacare), our Byzantine system of funding higher education, and our bewildering federal-state system of governing everything from the welfare state to environmental regulation, America has chosen more indirect and incoherent policy mechanisms than any comparable country.


By fnord12 | December 11, 2012, 4:57 PM | Liberal Outrage | Link



Reminder: EPA should be regulating carbon emissions

I've mentioned this before but i kind of contradicted myself in earlier posts when i said that after the Fiscal "Cliff" issue is resolved, Obama is out of leverage and basically has to wait and hope that in 2014 the composition of Congress changes before he can get any new laws through.

That neglects the possibility of doing something about carbon emissions. What's the leverage? Well, in 2007, the Supreme Court decided in Massachusetts v. Environmental Protection Agency that the EPA is required to regulate carbon. Even after that ruling, the Bush EPA of course slow-peddled the implementation of that regulation, but my expectation was that on day one of Obama's 2008 administration they start doing it. Not necessarily because i think it's the best way to deal with our global warming problem, but because many people don't think it's the best way to deal with our global warming problem, so you'd have some kind of consensus to get something less punitive through Congress. Instead the Obama administration only made vague noises about potentially maybe starting something, which wasn't enough of a threat to Republicans, so they demonized the hell out of Cap & Trade (which, i probably don't have to tell you, was a Republican solution in the first place) and therefore we got nothing.

Now that Obama doesn't have re-election to worry about, i can't imagine why he wouldn't start up EPA carbon regulation immediately so that he gets another swing at bat here. The positioning here should be the same as it should be for the Fiscal Cliff: "I'm basically ok with the current law and in order for me to change it you'd better offer me something really good."


By fnord12 | December 6, 2012, 3:11 PM | Liberal Outrage | Link



No new ideas, please

Back in mid-November, the Republican Study Committee put out a policy memo saying that we should relax our draconian copyright laws. That was on a Friday afternoon, and by Saturday morning the memo was retracted. Now, the author, "Rising Star" Derek Khanna has been fired. So that's what you get for going off message.

It's too bad because this is an area where there's little daylight between the two parties, and at a time where Republicans are looking to reposition them with younger voters, this is an issue where i think they could have found a lot of support. It's also one that fits with the Republicans' (purported) free market principles, since as Khanna's memo pointed out, government enforced monopolies are the antithesis of a free market.


By fnord12 | December 6, 2012, 2:53 PM | Liberal Outrage | Link



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