Rep. Darrell Issa (R-CA) and his conservative allies are pushing for legislation that would limit the first lady’s ability to do substantive policy work. Issa had originally proposed the bill last year, in fear of Bill Clinton moving back in to the White House. But he insists the bill is only about ensuring “transparency” for the work of first ladies, adding, “We are trying actually to protect the historic role of the first lady.” Or, as Gawker summed up Issa’s proposal in its headline, “Congressman Wants Michelle Obama To Shut Up And Look Pretty.”
At the beginning of the month, I wondered if one of the lessons of the current crisis isn’t that we need to reconsider if opposition to international capital controls has really been such a hot idea. If even a real right-winger like Megan McArdle is contemplating this position, I think I’m going to take up the banner. Kevin Drum suggests that this might be accomplished by means of a modest tax.
I find this idea appealing, much as I think idea of a small financial transactions tax is a good idea. In both cases, the thinking is that a modest tax should leave “real” long-term investments more-or-less unmolested. Thus savers in Germany and Japan can still have their money directed into profitable investment opportunities in Arizona and Shenzhen. But it would put a real crimp in short-term speculation and more generally slow things down.
A good example of the stuff I was talking about in my Animal Spirits review is this 2006 speech by Ben Bernanke on the subject of risk management in the financial sector. Bernanke began with the observation that “banks have invested in risk management for the good economic reason that their shareholders and creditors demand it.” And then he concluded:
The ongoing work on this framework has already led large, complex banking organizations to improve their systems for identifying, measuring, and managing their risks. Indeed, banking organizations of all sizes have made substantial strides over the past two decades in their ability to measure and manage risks. The banking agencies will continue to promote supervisory approaches that complement and support banks’ own efforts to enhance their risk-management capabilities.
What’s striking about this isn’t just it’s total wrongness in hindsight. It’s the nature of the logic Bernanke employs. Basically, Bernanke just assumes that everything is working well. If bank managers are doing a bunch of stuff in the field of risk-management, it must be the case that risk-management is improving. After all, it’s in the interests of creditors and shareholders for risk to be managed well, so that must be what’s happening. There’s no need to assess, in detail, whether or not things are actually improving. And there’s no consideration of the possibility that shareholders don’t really care, and bondholders are assuming (rightly, as it turns out) that loans to major financial institutions come with an implicit federal guarantee so managers are just mucking around to boost short-term profits and aren’t really inquiring too closely into the details.
In retrospect, though, that’s exactly what was happening. But a combination of financial industry political clout and strong neo-classical ideology made it impossible for the key policy player to see it. And not only did he not see it, he specifically gave his seal of approval to the casino.
Gov. Howard Dean (D-VT) has argued that you can’t reform the health care system without forcing private insurers to compete with a new public option. “If we only get community rating and guaranteed issue that’s great insurance reform, but that is not health care reform and nobody should mistake it,” Dean explained.
But Senate Finance Committee Chairman Max Baucus has recently indicated that the public plan is just a bargaining chip to “encourage the private health insurance industry to move in the direction it knows it should move toward—namely, health insurance reform, which means eliminating pre-existing conditions, guaranteed issue, modified community rating.”
Today, during an event at the Center for American Progress Action Fund, ThinkProgress caught up with Baucus and asked the senator if Dean was wrong in insisting that a public health plan is essential to achieving a more efficient health care system:
Let’s see what we come up with. I think we can accomplish the objective [Dean] wants without [a public plan]. We can, we’re going to have to work on it. But we may have to have it, [Dean] may be right. Just don’t know yet.
Dean believes that the public plan would improve system efficiency and quality, but Baucus is more interested in using the program as a political tool to bring insurers to the table and keep single payer advocates at the table. The public, however, supports the public option. According to a poll by Lake Research, “73% of voters want everyone to have a choice of private health insurance or a public health insurance plan while only 15% want everyone to have private insurance.”
During the question and answer session, Baucus reiterated that the public option is a bargaining chip to win concessions from the insurance industry:
Earlier this week, right-wing fanatic Rep. Michele Bachmann (R-MN) started peddling false conspiracy theories that the world was moving toward a unified global currency — and that the U.S. might join in as early as next week’s G-20 conference. The myth was started when China’s central bank governor suggested replacing the dollar as the world’s reserve currency. Though the suggestion has nothing to do with a unified global currency, Fox News’ Major Garrett decided to ask President Obama whether he supported the fictional prospect of such a move. (Obama, for the record, does not.)
Today on Glenn Beck’s radio show, Bachmann declared that the U.S. will soon be moving to “give up the dollar as our currency and we would just go with a One World currency.” Such action, she warned, would mean the U.S. as a country would be “no more”:
BACHMANN: As you know, Russia, China, Brazil, India, South Africa, many nations have lined up now and have called for an international global currency, a One World currency and they want to get off of the dollar as the reserve currency.
BECK: Most people don’t understand, Michele, what that means.
BACHMANN: What that means is all of the countries in the world would have a single currency. We would give up the dollar as our currency and we would just go with a One World currency. … If we give up the dollar as our standard, and co-mingle the value of the dollar with the value of coinage in Zimbabwe, that dilutes our money supply. We lose control over our economy. And economic liberty is inextricably entwined with political liberty. Once you lose your economic freedom, you lose your political freedom. And then we are no more, as an exceptional nation, as we always have been. So this is imperative.
Bachmann claimed that Treasury Secretary Timothy Geithner said he was “open” to the One World currency. (In reality, he only said he was open to changes in the IMF special drawing rights, and reaffirmed his commitment to the dollar.) Beck warned that speaking out about the global currency gets one labeled a “kook,” but Bachmann brushed off such concerns, saying she’s been called that “throughout [her] political career”:
BACHMANN: Well, Glenn, I have experienced that throughout my political career, being labeled a kook. It just happened again in a big story in the Minneapolis Star Tribune. But all we have to do is point to the treasury secretary on tape, on camera. This is not Michele Bachmann being a kook. This is our treasury secretary on tape and on camera.
Listen to it:
Transcript: Read more
Inside a nuclear power plant 10 miles southeast of Harrisburg, Pennsylvania’s capital, the first of a series of pumps supplying vital cooling water to the reactor unaccountably “tripped,” or shut down, at 36 seconds after 4 a.m. on March 28, 1979.
The tense, sometimes terrifying week that followed, marked by official confusion and “surreal” misstatements about the crisis’s severity, became known forever as the Three Mile Island accident, named after the reactor site on the Susquehanna River.
So opens the Greenwire (subs. req’d) story, the source for my headline. Now the nuclear power industry is trying to make a comeback, 30 years after the event that defined it for a generation.
But the legacy of TMI looms. As Peter Bradford, former Nuclear Regulatory Commissioner, has noted:
The abiding lesson that Three Mile Island taught Wall Street was that a group of N.R.C.-licensed reactor operators, as good as any others, could turn a $2 billion asset into a $1 billion cleanup job in about 90 minutes.
Nuclear power has many, many other limitations:
Michele Bachmann was recently on Glenn Beck’s radio show, so that two of the right-wing’s most prominent nutters could talk, inaccurately, about currency issues:
BACHMANN: Let me tell you, there’s something that’s happening this week in Congress that could be the eventual unravelling for our freedom, and it’s this. I had asked the Treasury Secretary and Ben Bernanke, the Federal Reserve Chair, if they would categorically denounce–
BECK: I know.
BACHMANN: –taking the United States off of the dollar and putting us on an international global currency. Because as you know, Russia, China, Brazil, India, South Africa, many national have lined up now and called for an international currency, a One World currency. And they want to get off the dollar as the reserve currency.
BECK: Most people don’t understand what that means.
Here, for once, Beck is on the money. As we’ll shortly see, neither he nor Bachmann understands what that means:
BACHMANN: What that means is that all of the countries of the world would have a single currency. We would give up the dollar as our currency and we would just go with a One World currency. And now for the first time, we’re seeing major countires like China, India, Russia, countries like that, calling for a one world currency and they want this discussion to occur at the G20. So I asked both the Treasury Secretary and the Federal Reserve chair if they would categorically denounce this. The reason why is because if we give up the dollar as our standard, and co-mingle the value of the dollar with the value of coinage in Zimbabwe, that dilutes our money supply. We lose country over our economy. And economic liberty is inextricably entwined with political liberty. Once you lose your economic freedom, you lose your political freedom. And then we are no more, as an exceptional nation, as we always have been. So this is imperative.
This falsehoods here are coming so fast and loose that it’s hard to know where to start here. But to get to the main point, most countries hold “reserves” of various kinds—foreign currency and gold. Most countries, right now, primarily hold dollars. Euros are also popular, and Yen and British Pounds somewhat less so. The United States of America does not, obviously, hold any dollars in our reserves. We actually have quite a lot of gold. And different countries vary their practices in this regard. But most countries mostly hold their reserves in dollars. So the dollar is, in effect, the “global reserve currency.” The IMF also issues something called Special Drawing Rights that countries can use as a reserve asset. SDRs work as a kind of meta-currency, with their value based on a basket of major world currencies. A Chinese official suggested that it might be good for the world to tilt away from such a heavy reliance on dollars as the reserve currency of choice, since this leaves countries exposed to policy decisions in the United States, and toward something more SDR-like that would be balanced between dollars and euros and yen and pounds and so forth.
This has nothing to do with replacing the dollars in your bank account—or Michele Bachmann’s—with a new currency. Nor would it be the creation of a One World Currency. And to be clear, while the United States could prevent the IMF from formally creating any kind of new internationalized reserve currency, there’s nothing we can do to stop foreign countries from weighting their reserve baskets away from dollars. It’s just not up to us.
At any rate, my colleague Ali Frick found this remarkable exchange and has the audio for your pleasure:
Keep in mind that these aren’t just two weirdos hiding out in a cabin somewhere. Beck has a show on a major cable news network and Bachmann has a seat in congress.
Yesterday, House Speaker Nancy Pelosi (D-CA) said that it was “absolutely essential” to pass “substantial health care reform legislation” this year, adding that “the best prospect for that to happen is under reconciliation,” which allows a measure to be passed with a simple majority instead of the 60 votes that otherwise would be needed. Senate Majority Leader Harry Reid (D-NV) said earlier this week that he would “consider” using the budget reconciliation process for health care. But Sen. Ben Nelson (D-NE) tells Bloomberg today that he would “vote against his party’s budget if it included the reconciliation procedure”:
The Senate’s draft of the budget omits the reconciliation language. Senator Ben Nelson, a Nebraska Democrat, said he would vote against his party’s budget if it included the reconciliation procedure.
“That’s a deal-breaker,” Nelson said. “I don’t think it’s appropriate to determine the health-care delivery system, the changes that will be there, through the reconciliation process.”
Nelson isn’t the only moderate Democrat warning against the use of the budget reconciliation process. Yesterday, Sen. Max Baucus (D-MT), the chairman of the Senate Finance Committee, said that “reconciliation is going to cause partisan warfare” that “would set health care reform back.”
This part of President Obama’s Afghanistan speech deserves attention, if only because it’s one of so many things that conservatives used to condemn but now have become part of the conventional wisdom:
In a country with extreme poverty that has been at war for decades, there will also be no peace without reconciliation among former enemies. I have no illusions that this will be easy. In Iraq, we had success in reaching out to former adversaries to isolate and target al Qaeda. We must pursue a similar process in Afghanistan, while understanding that it is a very different country.
There is an uncompromising core of the Taliban. They must be met with force, and they must be defeated. But there are also those who have taken up arms because of coercion, or simply for a price. These Afghans must have the option to choose a different course. That is why we will work with local leaders, the Afghan government, and international partners to have a reconciliation process in every province. As their ranks dwindle, an enemy that has nothing to offer the Afghan people but terror and repression must be further isolated.
Compare this to Dick Cheney’s assertion (on behalf of President Bush) that “we don’t negotiate with evil; we defeat it,” in reference to North Korea — which, if you haven’t heard, is now threatening to test a new ballistic missile. In Iraq, not only did we negotiate with evil, we paid evil vast sums of money to change sides. And now we’re going to attempt something similar with Taliban elements in Afghanistan, as well as with Iran: Try various methods and inducements — some of which have been/will be derided by many conservatives as “appeasement” — to change the strategic calculations of some of our enemies in order to gain advantage against other, worse enemies.
As we continue to discuss and debate the way forward, in Afghanistan and elsewhere, it’s hugely important to remind people that this central insight — our enemies are not monolithic, they can be disaggregated — represents a resounding refutation of the neoconservative “war on terror” approach that characterized the Bush administration’s foreign policy in the years after 9/11. Clearly, there are terrorist networks that seek to do Americans harm, but they do not represent anything like a united “Islamofascist” front against the West, no “axis of evil” necessitating “with us or against us” ultimata. The fact that progressives have won this argument is, of course, small comfort when one considers the enormous costs incurred by the Bush administration in making our case.
Unemployment in South Carolina reached 11 percent in February, a “dramatic increase from January’s 10.3 percent.” Five counties in the state face more than 20 percent unemployment, with the highest, Allendale County, at 23.4 percent. Even as he is being warned about enusing “chaos,” Gov. Mark Sanford (R-SC) continues his efforts to block $700 million in federal stimulus aid to the state, a move that could result in at least 4,700 teachers and prison guards being laid off.