Wednesday, August 31, 2011

Inflation Is A Tax On The Rich

With the Republican Party utterly opposed to tax increases on the rich but interested in raising taxes on the elderly and poor, opportunities for progressive income redistribution through taxation will be hard to find in coming years. Fortunately, there's another way to redistribute real wealth: inflation!

If people have a bunch of money, inflation reduces the real value of their cash stash. So they end up worse off. So do people to whom debts are owed, since they get paid back in relatively cheaper money. On the other hand, people who don't have a lot of money don't take much of a hit. People who are in debt actually end up better off, since the real value of their debts declines. The more money you have, the more inflation hurts you, and if you have negative money, it helps you.

If you're rich and most of your wealth is in cash or bonds or something like that, your main asset -- money -- becomes less valuable in terms of the amount of poor people's labor it can buy. But if you're poor and your main asset is just your labor, that becomes more valuable in terms of the amount of rich people's money it can command. This is a progressive redistribution of real assets.

That's why I've gotten really into all this platinum coin stuff, and I'm eager to find new ways to make more money come into existence. If you can spend it on something good for poor people, all the better! But just for its own sake, supporting a higher rate of inflation (4% would be good) is something worth doing.

Tuesday, August 30, 2011

All I Want Is Some Frickin Clouds, and some Frickin' Laser Beams!

Scientists in Switzerland have been testing the ability to affect the weather by firing laser beams into the air, possibly rainfall—they haven't gotten that far yet—but at the very least having some on where rain falls and how heavily.

I have no idea what the practical applications or moral implications of this sort of technology would be. It's a bit too close science fiction for me to process.

Thursday, August 25, 2011

Why Have Income Taxes When You Can Have Payroll Taxes?

I like Bernie Sanders' proposal to collect payroll taxes on income over $250K as a way to save Social Security. It's making me wonder whether it might be better to tax earnings entirely on the payroll side rather than the income side. To do this in a progressive way, you'd need a graduated structure for payroll tax rates. But this is the kind of thing that business tax software is set up to handle, so the extra complexity isn't going to cause any trouble.

If you'd like to minimize the impact of bad parts of the income tax code like the home mortgage interest deduction, this would be a way to do it. Just shift the taxation over to a place where the deductions don't exist. There are good deductions, like the charity one, but maybe it's worthwhile overall to just make the deductions irrelevant. At the same time, you'd be making tax preparation more efficient by doing it all in one place where professionals and computers could take care of it, instead of forcing every American to spend hours trying to be an amateur accountant in the first few months of the year.

Cover Vasectomies Too

Pema Levy notes that while contraception is free for women under the Affordable Care Act, this doesn't apply to men. I didn't even think about this before when I was getting all excited about free contraception for women. Simply covering contraception (condoms, vasectomies, etc.) for both sexes seems like the right thing to do here. Especially since "Vasectomies are far cheaper, safer, and have more minor effects than tubal ligation, the female sterilization procedure."

Unwanted pregnancies are highly disruptive events for the people directly involved, and for society in general. We all have an interest in preventing them.

Howard Schultz Is Helpless At Politics

Many successful businesspeople don't understand how you accomplish political goals:
Led by Howard Schultz of Starbucks, more than 100 CEOs have signed a pledge to halt all political campaign contributions until lawmakers, as Schultz puts it, "stop the partisan gridlock in Washington, D.C." ...AOL's Tim Armstrong, Frontier Communications' Maggie Wilderotter, Zipcar's Scott Griffith, Whole Foods' Walter Robb and Intuit's Bill Campbell have all signed up... Schultz has said his breaking point was the contentious debate over raising the debt ceiling -- and the failure to reach a long-term solution to lower deficits.
Maybe they're not telling it straight (hey, the economy is bad, and they have mansion payments to make) and this as a cover story. If so, clever or whatever.

But if they're serious -- the way you actually change the political system is not by leaving. It's by identifying the people who are closer to doing what you want, rewarding them, and punishing the people who are further away from doing what you want. Even if you think every single incumbent in the country is equally bad (which is unlikely, there are 536 of them at the federal level and countless more down further, so you can find a dozen that you really like and fund them) you could at least let their challengers know that pledges to do things the bipartisan way will be rewarded.

I wouldn't be annoyed about this if these were corrupt people who were using their money to corrupt the system. And for all I know, maybe they actually are just corrupt and I shouldn't be annoyed. But for the time being I'm taking their claims of being public-spirited people seriously worried about partisan gridlock at face value. If that's the truth, the path forward is easy. Identify the greatest villains (hint: if someone happily self-describes as a hostage-taker in the debt ceiling fight and says he'll do it again? there's a villain) and commit yourself to their destruction. Call them out as the unreasonable ones, and commit to helping their opponents.

If you take the people who claim to want bipartisanship at face value, they stand out in our politics as a class of especially confused and ineffective people. I guess the people who voted for Christine O'Donnell over Mike Castle in last year's Delaware GOP primary might outrank them on that score, and those who voted Nader in swing states back in 2000. But really, this is a case where it may be charitable to see them as dishonest, because the alternative is to see them as morons, and it just depends on what you think is worse.

Wednesday, August 24, 2011

Gaming The System

It turns out you can hack the lottery. I'm always in favor of turning the tables on the casino, especially when the casino has what's clearly a rigged game. In honor of those who manage to take the house, here's Michael Larson, the Ohio ice cream truck driver who took  Press Your Luck to the house in the '80s.

Thought Of The Day

I hope a bigger-than-the-initial-quake aftershock doesn't make this whole broken windows fallacy discussion immediately relevant. Though I suppose if it could somehow happen without injuring anyone, and Matt is right, maybe that would be a good thing? (Update: employment-wise, of course, not wealth-wise.)

Tuesday, August 23, 2011

Instead Of Drilling, Should We Build India Subways?

I'm reading Brad Plumer's post about how the billionth automobile just hit the road somewhere in the world, and wondering if building subways for up-and-coming developing-world countries be a good way to solve energy problems.

Oil is a global commodity. If you find some anywhere in the world, the added supply reduces global oil prices, not just prices in one specific location (setting aside issues related to transportation costs). I don't see why there's any difference, as far as long-term energy security is concerned, between discovering a whole bunch of new oil in the Indian Ocean, and reducing Indian oil demand.

As the term suggests, a lot of developing countries right now are developing their urban infrastructure. It looks like a lot of them could be at a tipping point where they decide to either build up the dense urban way, where people live really close together and go places on trains, or the dispersed car way, where people live far apart and consume energy by driving long distances. Tipping them the dense urban way would be a good thing for our ability to satisfy future energy requirements, not to mention the threat of climate change.

What To Make Of Road Privatization?

Reading Michael Dukakis' defense of Amtrak (which I plan to use frequently on my soon-to-begin lecture tour) made me wonder what I should think of road privatization. Congestion pricing sounds good to me, but what should I think of going all the way and just selling roads to private companies?

I suspect that if privatization happens, it'll take the corrupt form of roads being sold at prices lower than a free market would bear, to the corporations that bought the politicians overseeing the privatization. Privatizing an existing public service doesn't solve the public choice problems associated with having government run things. It lets them explode in one brilliant moment of corruption, a sad lesson to all who care about good public policy, and a beacon to all those who would like to profit from corrupt privatizations themselves.

Since the buyer is going to have a sort of regional auto transit monopoly, the competition that makes capitalism work won't happen here. If the roads are badly maintained under the current system, you call your local pork-barrel politician and get them fixed. But you're at the road monopolist's mercy. The roads have to get really bad before you'll start driving less, so why should they care until things get really bad? And this isn't a situation where if idiots are running the road company and just mismanage it, they go out of business quickly. Without competition to drive the large monopolist out of business, they can just keep being stupid for a long time.

Now you might see a silver lining. We solve the environmental problems associated with cars by destroying the roads! I don't think I'm radical enough to support this kind of thing, because I'm not ready to sign on to "let's destroy the roads" as a solution to climate change. And I don't think anyone currently in Congress is either.

Monday, August 22, 2011

The Future Is Here, It's Just Not Surgically Implanted

Matt Yglesias is hoping that one day we'll stick an RFID chip in our forearm and stop having to carry around so many keys and shopping cards. Given privacy concerns and the fact that surgery is expensive and not exactly the most pleasant experience in the world, it's more likely we'll come up with an alternative. But, what could that alternative be? We'd need some sort of device with a modest amount of computing power, capable of sending and receiving signals, that people are almost always carrying, and that's capable of some sort of near field communication. If people had such a device, they could use it to interact with grocery store kiosks, car doors, and the like.

... nope, not coming up with anything.

Sunday, August 21, 2011

Libyan Rebels In Tripoli, Cont'd

Congratulations to the Libyan rebels on reaching Tripoli, where they've met little resistance from Gadhafi's forces and captured two of Gadhafi's sons. You can see the celebrations outside the Libyan embassy in Tunisia a little while ago when the Tunisians officially recognized the rebels as the legitimate government of Libya (the Libyans can't figure out whether to hold up one finger or two, but that's okay). Hopefully in a few days, there'll be more on which to congratulate them. They should know that Americans who appreciate Star Wars rebel jokes are proud to support them.

There's been some turmoil in the rebel leadership after the death of one of their top army officers. I've been pretty impressed with some of the people running things there -- Mustafa Jalil, who was praised by Human Rights Watch for his stand against mistreatment of political prisoners, and UW economics professor Ali Tarhouni. Hopefully they can get things together and run the country.

All The Way To Tripoli

Juan Cole has been optimistic and right on Libya for quite a while now, and it's good to see him still being optimistic. The rebels have fought their way to Tripoli, and apparently underground rebel groups inside the capitol have risen up and taken control of territory in the last few days. At right is the map of districts controlled by rebel forces. I think he made it from this, but my red-green color vision problems don't allow me to see what's going on there.

This is kind of basic, but I'm struck by how different our intervention in Libya is from Afghanistan. In Libya, you can see obvious and measurable progress -- the rebels have slowly but steadily gained territory, defending their capitol, taking the crossroads town, taking the oil towns, and now they're at the capitol. Gadhafi's officials have defected as the rebels won battles. In Afghanistan, everything is murky and there's no visible signs of progress. And that's with 6 months of helping from the air in Libya and nearly 10 years of US ground troops in Afghanistan.

Of course, there's still plenty of challenges ahead in Libya. From deposing Gadhafi to constituting a government to holding fair elections to not falling back into a civil war of some sort, the really difficult parts are yet to come. But so far, so good.

Saturday, August 20, 2011

Thank You, Jon Huntsman, And Good Luck

Former Utah Governor and Ambassador to China Jon Huntsman, who's running for the GOP nomination in 2012:

"The minute that the Republican Party becomes the party - the anti-science party, we have a huge problem. We lose a whole lot of people who would otherwise allow us to win the election in 2012. When we take a position that isn't willing to embrace evolution, when we take a position that basically runs counter to what 98 of 100 climate scientists have said, what the National Academy of Sciences has said about what is causing climate change and man's contribution to it, I think we find ourselves on the wrong side of science, and, therefore, in a losing position."

Obviously, the biggest deal here isn't that one party might find itself in a losing position -- it's crop failure for hundreds of millions of subsistence farmers and the destruction of large portions of coastal cities. But he makes the basic factual points that science supports the theory of evolution and global warming. I'm very glad to have somebody contesting the Republican nomination coming out and saying all these things.

The usual thing people say is that with comments like this, he's not going to win the GOP nomination, and of course they're right. But especially after becoming Obama's ambassador to China, winning the nomination this time around was extremely unlikely. And there's still a way this could all work out very well for him. Huntsman is only 52 years old, and if the shape of American politics changes over the next decade or two, opportunities might open up. Maybe crazy people get the GOP nomination now and in 2016 and in all sorts of lower-level races, and they keep getting crushed, leading to the ascendancy of a sane GOP faction by 2020 or 2024. Or maybe Huntsman runs for the Democratic nomination as a candidate with crossover appeal, or gets Veeped up by some crafty Democratic nominee. As Ezra once noted, Obama's close enough to the sensible moderate Republicans of yesteryear anyway -- if we can accept him, why couldn't we accept the real thing?

Friday, August 19, 2011

Platinum Coins Can Save Obama's Presidency

Back during the debt ceiling showdown, I hoped that Barack Obama was going to use it as a pretext for minting multitrillion-dollar platinum coins. The idea was to run monetary stimulus out of the Treasury Department. (Update: if you're wondering how this works, Brad Plumer explains.) Certainly, Ben Bernanke could undo it all by raising interest rates. But he wanted monetary expansion while feeling it was politically dangerous for the Fed to take such unusual measures, this was the policy that would let him just sit on his hands and let Obama take responsibility.

Surprisingly, the end of the debt ceiling fight gave us an even stronger economic case for platinum coins. The Fed is committed to not raising rates until 2013. The stock market is falling, and forecasts of economic disaster are sending everyone out of stocks and into bonds, even with bond yields at historic lows. This is exactly when you use monetary stimulus, if you want to put people back to work.

Republicans understand this. In what looks like a thuggish attempt to win the election by keeping people unemployed, Rick Perry is threatening Bernanke not to do any more monetary expansion. He knows that expanding the money supply could save Obama's presidency. There are two people who can do it -- Bernanke, through more quantitative easing, and Obama himself, through platinum coin seigniorage.

So when Obama introduces his jobs plan in the coming months, he should also explain what'll happen if it doesn't pass quickly: He'll order the production of a few trillion-dollar platinum coins. The jobs plan still probably won't pass, because it's really hard to get anything through Congress these days. And that'll be fine! It wouldn't be the first time someone saved the economy and his presidency through an unconventional act of monetary expansion, straight out of the executive branch. Time to be Franklin Roosevelt.

Thursday, August 18, 2011

People Have Argued About What Makes You A Real Goth For Centuries

The earliest attestation of this claim comes from the Council of Basel, 1434, during which the Swedish delegation argued with the Spanish about who among them were the true Goths. The Spaniards argued that it was better to be descended from the heroic Visigoths than from stay-at-homers. This cultural movement, which was not restricted to Sweden went by the name Gothicismus or in Swedish Göticism, i.e. Geaticism, as Geat and Goth were considered synonymous back then.
The idea that the Geats were Goths will change the way I read Beowulf.

The fall of the Roman empire seems to have resembled a dysfunctional modern urban scene, with all the Goths and Vandals running around.

Michele Bachmann And $2 Gas

Michele Bachmann has promised a return to $2/gallon gas, if she becomes president. This could actually happen.

Gasoline prices tend to rise and fall with the strength of the economy, since a stronger economy produces greater energy demand. So if Bachmann were to pursue insane economic policies and send the US economy into a depression, gas prices could fall to $2 per gallon. The problem is that you might not have $2 to buy it with.

Wednesday, August 17, 2011

When They Think of Bush, They Think Of The War

Matt Yglesias attacks "the surprisingly persistent myth that George W Bush was some kind of legislative steamroller who somehow coerced Congress into doing things it didn’t want to do through magic narrative powers that Barack Obama unaccountably fails to use." He talks about Sarbanes-Oxley and McCain-Feingold and tax cuts and NCLB and Medicare Part D, and I'm pretty sure he's right about those. But his opponents will probably be willing to concede all of that. They're thinking about something else.

What they remember is the Iraq War, and about other legislation that came out of the War on Terror, the PATRIOT Act probably foremost. They're remembering how Bush managed to get most of the Democrats in a Democratic Senate to vote for the Iraq War Resolution, and got everybody except Russ Feingold to vote for the Patriot Act. They're remembering the Osama / Max Cleland ad, and how unfair the other Democrats were to Howard Dean, and how John Kerry couldn't even articulate a straightforward antiwar position in a presidential election. (For getting out of Iraq to become the mainstream Democratic position took another year and Jack Murtha.)

It's not surprising that this is the foremost thing on their minds. During the Bush years, progressive Democrats felt that most of the country saw them as unpatriotic and possibly traitorous for having well-reasoned and ultimately correct views on major foreign policy questions. People who deceived the country about WMD ruled the country and were admired, while people who figured out the truth and tried to make it clear to others were a minority taunted by everyone from Ann Coulter to Chris Matthews. You can forget Sarbanes-Oxley. This is the sort of thing that people don't forget. And it transforms the way they understand politics.

The idea is that the financial crisis could've been the Democrats' 9/11, and this time no WMD-style lies would be needed to pass legislation. The truth would be enough. Under the same sort of national climate of anger, this time one where anybody who opposed higher taxes on the rich or more bank regulation or health care reform or whatever would be hated as an elitist scumbag, Republicans would find themselves tied in the same knots that Democrats were over Iraq. Whatever it was that prevented Democrats from filibustering the Iraq War Resolution, that got them making bad arguments against Dean, that got all that ridiculous War on Terror legislation through -- that was going to happen again, just the other way around. And we would get lots of big progressive legislation passed, just like Bush got his War and Homeland Security and the Patriot Act. And since our big legislation is actually good legislation instead of being disastrous like the Iraq War, this would be a tremendous achievement for America.

Anyway, that's the idea. Maybe there's some reason it wouldn't work. But citing a bunch of domestic policy legislation where Bush had to cut deals really is irrelevant. The big question in progressive minds and hearts is: Why can't we do it the way Bush did all the War on Terror stuff?

Tuesday, August 16, 2011

Here In Civilized Society, We Don't Threaten The Fed Chair

Instead of dissecting Texas job growth numbers to understand Rick Perry as economic manager, we should focus on his comments regarding Ben Bernanke:
I know there’s a lot of talk and what have you about if this guy prints more money between now and the election, I don’t know what y’all would do to him in Iowa but we would treat him pretty ugly down in Texas. I mean, printing more money to play politics at this particular time in American history is almost treacherous — or treason, in my opinion.
The chairman of the Federal Reserve is supposed to manage monetary policy. Bernanke's increases in the money supply have left inflation at historically low levels. The bad thing that could happen when increasing the money supply is the wrong decision didn't happen. In fact, I think it'd be good to print a lot more money, since there's not enough of it going around.

I don't know if there's any precise way to characterize the role of the president in monetary policy. But this, I think, is a minimal standard that Presidents should achieve: Don't accuse the Fed Chair of treason for doing his job, or suggest violence against him. If you can't meet this standard, civilized people should regard you as a barbarian rather than a legitimate contender for political office.

This is a rare occasion where Republican establishment power brokers might agree with me. (Republicans, including some who worked in the Bush White House, have criticized Perry's remarks.) Their money is at stake as much as anyone else's if the president is making ignorant threats against top economic policymakers rather than just focusing on how to make the rich richer. If this gets them to pull the plug on Perry's candidacy, they'll finally be doing something in America's interest as well as their own.

Update: Brian Beutler's reading makes Perry less of an idiot and more of a thug. On his reading, Perry is intentionally trying to intimidate Bernanke into keeping the economy weak so that Obama will lose. If he's right, this is a kind of threat I've never seen before in US politics.

Of Horndogs And Corndogs

While I'm amused by photos of Republican candidates enjoying corndogs, I think the right way to appreciate them is one that doesn't imply anything discreditable about the corndog-eater. The fact that it looks vaguely like the eater is fellating a penis should merely be seen as a silly coincidence. Even when this is pointed out, the eater should not feel any embarrassment about the matter.

In general, I don't think people should be hesitant to eat foods with a phallic shape. Corndogs don't strike me as an especially good food, but many better foods such as sausages, bananas, and popsicles have such a shape. It's a good shape for manmade foods, as it allows them to fit nicely inside the mouth through the entire eating process.

Also, I don't think that there's anything particularly embarrassing about sucking on penises. It's a behavior that pleases others. We rightly admire behaviors that please others, and the sucking of penises should be no exception to that rule.

Sunday, August 14, 2011

DARPA's Thing

I like the way they put it: "The U.S. Defense Advance Research Projects Agency on Thursday launched the second of its hypersonic flight tests, and promptly lost contact with it." As if the aircraft might've spent Saturday night on a joyride around the ionosphere while DARPA scientists sit at home worrying about why it isn't returning their calls.

I guess this is how science goes, though -- you have a lot of failed experiments before a successful one. Of course, I don't have any idea whether this is a doomed project like ballistic missile defense or something that could actually work.

The nice thing about DARPA is that money nominally allocated to defense, which could've at worst supported all sorts of pointless brutality, instead goes to useful research. The bad thing is that the money would've been much more usefully channeled if it wasn't being distributed under the defense framework.

The End Of The Minnesota Meh

That's what Jonathan calls Tim Pawlenty, who just dropped out of the race.

At this point, the top three news links on TPM are all the other candidates being nice to Pawlenty. This is what you'd expect when a candidate drops out of a primary -- everybody else tries to be nice to him to win over his supporters. I guess it's more important when they actually have a large number of fervent supporters who identify with the candidate, but it can't hurt even in this case.

I'm pretty sure Pawlenty would've soldiered on a bit longer if it hadn't been for Perry's entry into the race. So far we have two clearly defined options -- unprincipled but competent centrist Mitt Romney, and crazy Michelle Bachman. Pawlenty was the candidate for people who for some reason were turned off by both, perhaps movement conservatives who seriously think about winning a general election. Now Perry emerges as the more exciting option for that constituency.

Friday, August 12, 2011

Solving Fiscal Problems In A 10-1 World

How do you reduce the national debt in a world where you can't raise taxes, because Republicans won't raise taxes by x even if you offer them 10x the spending cuts?

There's one straightforward solution: print more money. Or, as we've discovered we can do, mint the trillion-dollar platinum coins! You get two kinds of debt reduction. First, you get nominal, though also real, debt reduction when you use the coins to pay back debt (maybe you have to ask Ben Bernanke for change for a trillion first? I'm not sure how that works). You also get real debt reduction when you generate inflation, and the real value of the national debt decreases. The pain of inflation is borne by people who have lots of cash, who tend to be rich, so it's kind of like taxing the rich.

Of course, nobody really cares about reducing the national debt except for conservative Democrats, a few economists, and Pete Peterson, so it's not like the answer really matters. Everybody else talks about it so they'll sound serious and responsible, and making the trillion dollar coin doesn't really sound serious and responsible.

Tuesday, August 9, 2011

Mitt Romney Guest Stars in in Polls Behaving Badly

Mitt Romney cites a PPP poll "showing" that only he can win Texas. Not even Rick Perry is ahead of Barack Obama in the Lonestar state. Now, of course, Perry has pretty good name recognition in Texas. But at the time of the poll, he wasn't even pre-running for President. General election polls at this stage of the game are totally bunk. Obama's approve/disapprove numbers in Texas are pretty poor, so almost any candidate will probably win the state in a walk this year.

Monday, August 8, 2011

Obama Transforms from "Different Kind of Democrat" to "Generic Democrat", Still Vaguely Ahead in the General Election

One novel aspect of the 2008 campaign was that Barack Obama was able to open up territory where Democrats were previously considered uncompetitive. This was party driven by economic and conditions that favored Democrats, but it was also partly due to Obama's persona as something of a "different kind of Democrat" who was more acceptable than usual to voters living in the Upper Midwest and Northern Plains states. Obama won Indiana, the elector for the Omaha district, ran TV ads in Alaska (until Palin became the VP nominee) and North Dakota, and did significantly better than previous Democrats in Montana and South Dakota.

According to the new state-by-state numbers from Gallup, most of that good will is now gone. Views of Barack Obama are now uniformly unfavorable between the Mississippi River and the Pacific Ocean. He does retain relatively good ratings in Indiana, compared to the drubbings that Democrats received in that state prior to his nomination. And the slight shift of the Atlantic Southeast is an impressive accomplishment if it endures for the next decade. But the dreams of a permanent rupture of the Presidential map seem to be over.

If we go strictly by the poll numbers and award Obama all states where his net approval rating is above +3, and the GOP challenger all states where the President is at -3 or worse, then Obama is ahead, 257-192. His path to victory would involve winning either Virginia, Ohio, Florida, or North Carolina. If we believe that the numbers in Oregon, Mississippi, South Dakota, and Georgia are suspect, then he is ahead 248-194 or 248-210, depending on how you count Georgia. At that point, he must win either Florida, or any two out of Virginia/Ohio/North Carolina/Georgia. We are still too far from election day to make any definitive assessments, but at the time being, Republicans are still behind the 8-ball.

Saturday, August 6, 2011

Free Birth Control!

Amanda finds the good news that you might've missed amidst all the eyecatching bad stuff:
the HHS announced that birth control is going to start being free to women with insurance. When it starts being free to you depends on when your insurance plan begins---it could be as late as 2013 for many women---but still. Free birth control. And by birth control, I don't just mean the pill or the ring. You will also be able to get your tubes tied, an IUD installed, or an implant put in....all for free. No co-pay for any contraception. Free pills is a good thing and should reduce unintended pregnancies, but the free long-term birth control methods may be a bigger deal. A lot of women would prefer to have these kinds of birth control, but the up front costs are just too daunting. Preliminary research shows that women who have access to free long-acting birth control both are far more likely to use these methods and, unsurprisingly, have fewer abortions.
The stock market may fall; our bond ratings may go down. And we will fuck our way through it all.

Julian may be right that in a better world the government would provide birth control as a means-tested entitlement for people below a particular income level, rather than through an insurance regulation covering everyone. But we're in a world where Republicans won't let you raise taxes to pay for socially beneficial programs -- especially those that help the poor and 10especially those that help people lead satisfying sex lives. So we have to fund nice things some other way.

When Julian criticizes this by saying "And that seems a little like salt in the wound: Isn’t it bad enough to not be getting laid regularly without having to pay for the people who are?" I say: it's not salt, it's the fucking balm of Gilead. If you're a woman and you're frustrated about not getting laid regularly, get yourself some free birth control and find yourself a man! And if you're a man and you're frustrated about not getting laid regularly, go find the woman in the previous sentence! This is the kind of regulation that enables us to make our own lives better.

Thursday, August 4, 2011

Ours Is a Government of Men, Not of Procedures

Ezra Klein's Bloomberg column makes some important points.The money paragraph is at the end:
Observers occasionally sigh deeply and blame this on bitter polarization of the two major political parties. But that’s not quite the problem. Nor is the issue that our political system is ill-designed. It’s that our political system is ill-designed for parties that are so polarized. Our system is designed for consensus. When that breaks down, the system turns on itself, its many veto points and blockages placing a chokehold on action. To escape the gridlock, the parties establish elaborate extra-congressional fixes, circumventing the political system itself. The government can still work. It just doesn’t work very well: not for liberals, not for conservatives, not for the country.

The essay's headline is "Isn't it time to admit the system is broken?", to which the answer is almost certainly "yes". The system is very broken. The public's nexus for policy accountability—the Presidency—has very limited power to affect policy outcomes. Actors with the largest ability to affect outcomes have extreme incentive to produce poor outcomes while the opposition controls the White House.

Still, observing the brokenness of "The System" shouldn't alleviate the agency of the people currently working within the system. After all, "The System" is populated by people. The decisions to maximize the use of procedural tools to gain tactical advantages at the expense of compromise were made by living, breathing, individuals who have names and faces, not the output of some game theory simulation in a poli sci major's PhD thesis. These decisions could be unmade with or without changes to Congressional procedure.

That said, in the past our response to a breakdown in social norms that prevented the use of Congressional procedure to obstruct has been to ... alter Congressional policy, as Jeff Merkley pointed out to Ezra Klein some time ago. No one has stepped up to the plate to do this yet; there have been some nibbles around the edges, but no real changes. And, surprisingly, no real prospects for procedural change on the horizon.

Build Roads n' Stuff (even if it means raising the gas tax)!

The way to pitch raising the gas tax is not to highlight the increase in the gas tax, but to instead point out what it is that money pays for. People like roads! In 2005, an relatively unpopular governor passed a gas tax increase in a ballot-initiative happy state. You would think that an initiative to repeal something like that would succeed. But no; the repeal initiative lost 45-55. People like roads. Community leaders in small towns know that road construction brings jobs and ease traffic problems (and yes, small towns, which often have very few major thoroughfares, have traffic problems). Our core infrastructure continues to lag behind the rest of the developed world, and the public is willing to pay for improvements to the pieces of infrastructure that people see and use every day.

The last time the federal gas tax was increased, gas was under a dollar per gallon. Construction costs have grown immensely since 1993, and our unwillingness to face fiscal facts on the gas tax is one reason we're having a hard time bringing any new lane capacity on line.

Tuesday, August 2, 2011

Platinum, Someday

The 2011 iteration of the debt ceiling crisis may have come and gone, but in the future I hope people will remember that the president can order the creation of platinum coins of arbitrarily large denominations.

Our bottlenecky political system threatens to create all sorts of funding crises in the future as veto players withhold their approval from measures necessary to keep the government operating. Sometimes people will be reasonable and disaster will be averted, but we can't always count on that. So there's going to be need for a way for making money come into existence to resolve crises.

With excessively low inflation, we're going to need a way to get the money supply up and get ourselves out of liquidity traps. In a good platinum coin seigniorage article, Scott Fullwiler writes that "as long as Congress doesn’t appropriate spending great enough to be inflationary, there’s no inflation problem, regardless of whether we use coin seigniorage to make the debt ceiling irrelevant." I think the antecedent needs to be taken seriously -- shutting down federal spending because of the debt ceiling or some other political problem will push things in a somewhat deflationary direction, just as elevated federal spending will be somewhat inflationary. And that's a good thing! We've been closer to the vices of deflation than inflation in recent years, and more federal spending will help.

Obama missed the opportunity in this crisis, his own chance at a grand FDR-style presidential act of monetary expansion. Maybe in the future, someone else will go platinum.

Policy Affects Political Debate Only In The Slightest

Jonathan Berenstein is certainly right about this. In any given election, both sides will accuse the other of some combination of raising taxes, cutting Social Security and Medicare spending, being soft on defense, and perhaps cutting important discretionary spending in places where people care about it, such as education. Whether or not the debt ceiling bill includes some hypothetical future cuts to hospital payments is unlikely to affect the content of campaign advertising; if Medicare looks like a salient issue in September 2012, Republicans will find some other way to accuse Democrats of cutting it.

Monday, August 1, 2011

Do These Jokers Seriously Not Know When To Declare Victory and Depart The Battlefield

Mitch McConnell had the good sense to realize he's won, and act like it, but Mitt Romney can't bring himself to say yes. I expected this sort of thing if the deal contained actual, honest-to-god tax increases, but this is cuts only and whatever blue ribbon commission this bill creates is only empowered to find spending cuts. It's, as someone cleverly observed on my twitter feed, a sensible centrist compromise between Eric Cantor and Mitch McConnell. I suppose Romney thinks he has to worry about Michelle Bachmann on his right flank, or he's anticipating that the economy will continue to stumble along and he can point to the debt ceiling increase as part of the problem, but he's going to shred whatever credibility he has as a moderate if he can't support something as basic as preventing default.

A Failure Of Imagination, The Remix

Rather than repeat myself, just read what I had to say when we got a tax cuts-only deal in December.

Before you go say that we would have been better of under President Clinton, imagine what Health Care Reform would have looked like if Al Franken and Mark Begich weren't in the Senate.