Given the objective constellation of forces, I don’t think it was necessarily a mistake of the White House to sign off on the appropriations deal. The deal will hurt the macroeconomy, but a shutdown would have hurt it more. But the administration’s rhetoric about the deal is a good deal harder to accept. When people with badly wrongheaded ideas about economic policy gain control of congress, bad deals become inevitable. Signing them is forgivable. Turning around and calling the bad deal a good one is much less forgivable.
Now we have Barack Obama hailing large spending cuts at a time of high unemployment and low interest rates and Mike Pence saying the deal’s not good enough to vote for. John Boehner now holds the center ground, and “everyone agrees” that it makes sense to reduce aggregate demand in the middle of a recession.
Tomorrow, Rep. Michele Bachmann (R-MN) will appear before the Iowa FAMiLY Leader, the radical anti-LGBT group headed by Bob Vander Plaats, as she lays the groundwork for a potential presidential campaign. As ThinkProgress reported Friday, the FAMiLY Leader and Vander Plaats himself hold some abhorrent views about homosexuality, including the belief that it is a “public health risk” along the lines of secondhand smoke.
According to CNN, Bachmann’s first hire in her presidential campaign will likely be Iowa State Senator Kent Sorenson (R), who will serve as her state political director. Sorenson gained notoriety as the author of Iowa’s “birther bill” requiring “birth certificates to be filed with affidavits of candidacy for presidential and vice presidential candidates.”
Given the fact that Bachmann’s cozying up to the FAMiLY Leader, ThinkProgress caught up with her planned political director to get his thoughts about the ideas being pushed by Vander Plaats’s group. In a surprise move, Sorenson sharply criticized the notion that homosexuality is a “public health problem” akin to secondhand smoke, calling the argument “absurd.” Sorenson went on to declare that “I would never make that argument and I haven’t heard anybody in Iowa make that argument”:
KEYES: There’s been a lot of debate that it [homosexuality] is almost a public health problem, akin almost to secondhand smoke.
SORENSON: I think that’s absurd. [...] I would never make that argument and I haven’t heard anybody in Iowa make that argument, so I’m not sure where you’re coming up with that from.
It’s important to note that Sorenson is only speaking for himself in this capacity, not Bachmann. Still, as the Minnesota Republican seeks the backing of the FAMiLY Leader and its supporters tomorrow, it is worth asking: does Bachmann agree with the Iowa FAMiLY Leader that homosexuality is a “public health risk” akin to secondhand smoke, or does she agree with her political director who called this claim “absurd”?
[Larry] Summers was terrific, acknowledging that the stimulus of February 2009 was too small, that the idea of deflating our way to recovery is insane, that de-regulation had been excessive, and that much of the economics profession missed the developing crisis because its infatuation with self-correcting markets.
If only this man had been Obama’s chief economic adviser!
It reminded me a bit of Eisenhower’s farewell address, warning of a military-industrial complex, or Citizen Jimmy Carter’s sublime post-presidency. Why do these people find their consciences and souls after they give up power?
I think that’s a very smart observation, but all too often people fail to draw the correct implications. The takeaway here ought to be that we all need to try harder to resist the fundamental attribution error and to avoid overrating the importance of specific people. If it often seems that ex-officials are wiser and more moral than they were when in office, maybe the problem is not with the officials but the offices.
Appearing on ABC’s This Week with Christiane Amanpour on Sunday morning, Rep. Mike Pence (R-IN) denies that Republicans threatened to shut down the government over funding to Planned Parenthood, even though he did exactly that five days before. Pence said Rep. Chris Van Hollen’s (D-MD) criticism of how Republicans used the budget fight to impose their right-wing policies on the country was “nonsense”:
Let me say, first off, it’s nonsense to say that Republicans were willing to shut down the government over this.
However, on Tuesday, Pence told MSNBC’s Willie Geist that “of course” he was willing to “hold up this entire budget over defunding Planned Parenthood.”
With the arrival late Friday of a compromise deal to fund the government through the rest of the 2011 fiscal year, eyes are turning to the looming fight over an increase in the debt ceiling. And today, House Majority Whip Eric Cantor (R-VA) reiterated to Fox News Sunday host Chris Wallace his intention to hold the nation’s fiscal health hostage in order to advance the right’s ideological agenda:
CANTOR: We’re talking about putting in maximum caps as far as expenditures are concerned. We’re talking about changing the way that the entitlements work in this country for the future, while protecting today’s seniors. These are the kind of things that we’re talking about.
WALLACE: Let me make sure I understand. Obviously, that would be part of the 2012 budget. Are you saying you will impose them as part of the deal to raise the debt limit?
CANTOR: Just as we saw happened this week in Washington, there comes a time leverage moment here, a time in which the White House and the president will actually capitulate to what the American people want right now. They don’t want to raise taxes. They don’t want spending to continue to spiral out of control. Those are the kind of things and mechanisms — whether it’s spending caps, entitlement reforms, budget process reforms — these are the kinds of things that we’re going to have to have to go along with the debt limit increase.
Rep. Jeb Hensarling (R-TX) also piled on the bandwagon, pointedly refusing to give CNN’s Candy Crowley a simple “yes” or “no” answer on whether he would “play chicken with the debt ceiling”:
CROWLEY: So you will vote for the debt ceiling?
HENSARLING: The president’s going to have to cut up the credit cards. He’s gonna have to work with us to cut up the credit cards and put the nation on a fiscally sustainable path. Otherwise, we’re going to continue to continue to lose jobs and we’re going to bankrupt our children. It’s that simple. At some point you just gotta quit spending money you don’t have.
CROWLEY: But you’re not willing to play chicken with debt ceiling? Just yes or no if I could.
HENSARLING: Well, I don’t know what you mean by playing chicken. I’ve said the same thing three times. I do not want America to default on its debt. But the president is going to have to start the process of cutting up the credit cards, pure and simple.
It is widely understood — including among Republicans — that failing to raise the debt ceiling on schedule could have immediate and dire consequences for government services and the global economy. As the Center for American Progress’ David Min has pointed out, it would force an immediate cut of approximately 40 percent to all activities of the federal government; a severe blow to our already struggling economy. It could also erode confidence in U.S. Treasury bonds, causing interest rates to spike and the possible destabilization of global financial markets. Sen. Lindsey Graham (R-SC) has acknowledged as much, as has House Speaker John Boehner (R-OH), Rep. Paul Ryan (R-WI), and conservative columnist George Will.
This has not prevented many GOP lawmakers, including the very politicians just listed, from threatening to vote down an increase in the debt limit if their partisan demands are not met. Senate Majority Leader Mitch McConnell (R-KY) has said there can be no increase without entitlement cuts, Sen. Ran Paul (R-KY) demanded an implicit 44 percent cut in all government programs in exchange for an increase, Graham named slashing Social Security as his price by Graham, and Rep. Steve King (R-IA) has called for using it to undo health care reform.
Tyler Cowen asked yesterday if the stimulative impact of hypothetical negative nominal interest rates wouldn’t just be undermined by people shifting into a different currency. My first response was that such a move would reduce the value of the currency in question, thus expanding demand through the net exports channel. But my second and better response is that whatever problems may or may not exist in this domain have nothing in particular to do with negative nominal interest rates.
Even in a zero lower bound world, interest rate differentials exist and therefore the carry trade happens. To what extent this is a problem for monetary policy is an interesting issue. My understanding of the evidence is that capital controls help a country maintain monetary policy autonomy which to me is a pretty strong argument for capital controls. But either way, there’s no special issue of negative nominal rates here, and it still seems to me to be the case that moving to an all-digital currency adds an important stabilization tool.
Whiter clouds reflect more solar energy back into space, cooling the Earth.
But a study presented at the European Geosciences Union meeting found that using water droplets of the wrong size would lead to warming, not cooling.
As science advisor John Holdren resasserted in 2009 of strategies such as space mirrors or aerosol injection, “The ‘geo-engineering’ approaches considered so far appear to be afflicted with some combination of high costs, low leverage, and a high likelihood of serious side effects.”
Two major problems for most of the ‘hard’ geoengineering strategies — aka solar radiation management aka smoke and mirrors — are that they still require aggressive mitigation, and they must meet a very strong test of science.
Having secured “draconian” cuts in a last-minute budget deal last week, House Republicans are hyping House Budget Chairman Paul Ryan’s (R-WI) new “Path to Prosperity” plan. The proposal professes to reform programs like Medicare and Medicaid to rein in spending by $6.2 trillion over the next decade. But as the Washington Post’s Ezra Klein notes, Ryan’s Medicare and Medicaid plans “rely on the same bait-and-switch: They use a reform to disguise a cut.” By making Medicare a voucher program and Medicaid a block grant program with $750 billion less in funding, Ryan’s plan forces seniors to pay more for the same benefits, according to the non-partisan Congressional Budget Office, and jeopardizes vital health care services for millions of low-income Americans.
Today on Fox News Sunday, host Chris Wallace questioned House Majority Leader Eric Cantor’s (R-VA) support for a plan in which Americans “pay more out of pocket.” Defending the proposal, Cantor argued that these programs sometimes provide a “safety net” for “people who frankly don’t need one” and that the shift of the burden from the government to the beneficiary will teach government “to do more with less”:
CANTOR: We are in a situation where we have a safety net in place in this country for people who frankly don’t need one. We have to focus on making sure we have a safety net for those who need it.
WALLACE: The Medicaid people — you’re going to cut that by $750 billion.
CANTOR: The medicaid reductions are off the baseline. so what we’re saying is allow states to have the flexibility to deal with their populations, their indigent populations and the healthcare needs the way they know how to deal with them. Not to impose some mandate from a bureaucrat in washington.
WALLACE: But you are giving them less money to do it.
CANTOR: In terms of the baseline, that is correct…What we’re saying is there is so much imposition of a mandate that doesn’t relate to the actual quality of care. We believe if you put in place the mechanism that allow for personal choice as far as Medicare is concerned, as well as the programs in Medicaid, that we can actually get to a better resolve and do what most Americans are learning how to do, which is to do more with less.
In reality, the Medicaid cuts will actually force states to do less with less. As the Wonk Room’s Igor Volsky points out, Ryan’s block grant idea would actually “destroy Medicaid” because the annual federal appropriation would be less than projected growth. States would thus make up the difference “by increasing spending or (more realistically) capping enrollment, cutting eligibility, limiting mandatory benefits and lowering provider reimbursements.” Numerous GOP governors are already itching to do so. And for Medicare beneficiaries, not only would low-income seniors end up paying more for the same benefits, but health insurers “will likely cherry-pick the healthiest enrollees” thereby increasing the costs for sicker individuals.
The Ryan plan does, however, provide a “safety net” for one specific demographic. Ryan’s plan will reduce the top marginal income tax rate and the corporate income tax rate from 35 percent to 25 percent — a move that, as the Wonk Room’s Pat Garofalo notes, shifts the tax burden down the income scale onto the middle class. Given these priorities, it appears that, for Cantor, those in need of a safety net are America’s wealthy.
But you can see the problem. If you limit building supply, then you limit the number of firms that can locate in an area. But firms don’t work in isolation. They create demand for other businesses (accountants, consultants, lawyers, ad firms, or design firms, for instance). Additional supply, by making it affordable for more businesses to operate in an area, attracts additional ancillary uses, which will occupy still more space.
Now, if there is falling demand for an area in the first place — if some structural trend, like suburbanization associated with rapid increases in car ownership, or like the collapse of Midwestern industry, is undermining the very purpose behind an economic node — then adding a lot of new supply might accelerate decline. When rents are falling and vacancy rates are rising, local leaders often think that a bold new project may turn an area around. But this is mistaken; it will add to supply and accelerate price declines, potentially pushing rents below building maintenance costs and generating pressure to tear down existing structures.
But this is precisely the opposite of what we observe in the economically dynamic, skill-driven cities in which supply limits are so enormously costly.
Exactly. If you make it cheaper for a company to get the office space it needs to expand, you increase demand for secondary business services. And the increased employment in those secondary business service fields also increases demand for lower skilled support staff (janitors, security guards) as well as for general retail and entertainment services. There’s a huge multiplier associated with an increase in business activity that’s mostly limited by the high cost of space and the hassles of congestion (not just traffic jams, but general crowding and unpleasantness). If you manage congestion better and reduce restrictions on the availability of space, you can reap big benefits.
By Andrea Nill Sanchez on Apr 10, 2011 at 11:55 am
In July 2008, a researcher “looking to dig up dirt on Obama” instead came across a birth announcement from 1961 in the Honolulu Advertiser documenting the birth of then presidential candidate Barack Obama in the state. For many, the announcement, together with Obama’s birth certificate, conclusively proved that Obama was born in the United States and is eligible to run for president.
Rumored presidential hopeful Donald Trump isn’t convinced. On CNN’s State of the Union today, Trump claimed that Obama’s grandparents planted the announcement to obtain welfare benefits:
TRUMP: The grandparents put that [birth announcement] in [the newspaper] because obviously they want him to be a United States citizen because in those days, people were much more proud than they are today unfortunately for being a United States citizen.
So they wanted him to be a citizen of the United States, for that purpose, and also for hospitalization, for welfare, for this, for that, for all the other assets you get from being a United States citizen. So there are a lot of very smart people who say that is routinely done and that was done by his grandparents. [...]
CROWLEY: I will tell you we’ve checked with both these papers early on — not to the latest when you brought it back in the headlines — but the fact is that the hospitals reported this information to the papers, and the papers printed it.
TRUMP: Who knows? You’re talking fifty years ago.
On several occasions, Trump has implied that Obama’s grandparents essentially lied about his citizenship “for social reasons.” The other “smart people” who agree with him include conservative blogger Tom Maguire who claims the birth announcement was planted to win a potential custody battle involving “a black Kenyan baby sought by the black Kenyan father and his African family.”
Yet, as Crowley pointed out, the birth information printed in the Honolulu Advertiser always came directly from the state health department (via the local hospital), not Obama’s grandparents or relatives. It’s also worth noting that since Obama’s mother was a U.S. citizen, he was automatically conferred citizenship and all of its “assets” no matter where he was born, thus making him eligible anyway for the benefits Trump claims his family committed fraud to obtain. Unless his grandparents somehow knew that baby Obama would one day want to run for president, there wouldn’t really be a reason for his family to fabricate a convoluted lie regarding his birthplace.
White House senior adviser David Plouffe dismissed Donald Trump’s birther beliefs today, noting that “there may be a small part of the country that believes these things, but mainstream Americans think it’s a side show.” In fact, more than half of GOP primary voters believe Obama was not born in the U.S., compared to 11 percent of the general public.