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Yglesias

Interest Group Politics in China

By Matthew Yglesias on Aug 9, 2010 at 5:28 pm

File-Wen_Jiabao_-_World_Economic_Forum_Annual_Meeting_2009 1

If someone proposed that the United States adopt a policy that massively reduced the wages of every worker in America as a strategy to increase the profitability of US-based firms, everyone would recognize the policy for what it is. But when China holds its currency artificially low—which has the same impact—many people tend to see it as a cunning example of economic policy in action, rather than as special interests capturing the Chinese policy process and running it in a destructive way. Part of the issue is that people often don’t see that interest group politics exists in foreign countries, especially ones that aren’t democratic. But look at the latest reports out of China on Prime Minister Wen Jiabao’s efforts to deliver on his promise to use an “iron hand” to increase energy efficiency:

The Ministry of Industry and Information Technology quietly published a list late Sunday of 2,087 steel mills, cement works and other energy-intensive factories required to close by Sept. 30. [...] Over the years, provincial and municipal officials have sometimes tried to block Beijing’s attempts to close aging factories in their jurisdictions. These officials have particularly sought to protect older steel mills and other heavy industrial operations that frequently have thousands of employees and have sometimes provided workers with housing, athletic facilities and other benefits since the 1950s or 1960s.

To prevent such local obstruction this time, the ministry said in a statement on its Web site that the factories on its list would be barred from obtaining bank loans, export credits, business licenses and land. The ministry even warned that their electricity would be shut off, if necessary.

Chinese political institutions aren’t the same as American ones, but what you can see here is that they’re not totally different either. This is not at all dissimilar to the debate playing out over the EPA’s Clean Air Act mandate to regulate greenhouse gas emissions. Public officials, whether in China or West Virginia or Ohio, often see it as their job to defend the interests of local employers and businessmen.

Yglesias

Problematics of Progressive Solidarity

By ThinkProgress on Aug 9, 2010 at 4:44 pm

By Ryan McNeely

targetlogoYou may have heard that retailer Target was caught up in a controversy last week after it was revealed that its corporate PAC had donated (thanks to the Citizens United decision) $150,000 to an organization backing extreme anti-gay Minnesota gubernatorial candidate Tom Emmer. LGBT advocacy organizations and blogs expressed outrage, and MoveOn.org sent me an email arguing that since “Target just gave a huge contribution to a anti-gay, anti-immigrant, anti-progressive candidate for governor in Minnesota,” I should sign their petition calling for a boycott of the store. Somewhat surprisingly, this campaign actually worked, and the CEO took the unusual step of apologizing for the contribution and promising that “later this fall, Target will take a leadership role in bringing together a group of companies and partner organizations for a dialogue focused on diversity and inclusion in the workplace, including GLBT issues.”

So I thought this was the end of the story — until I received another email from MoveOn.org. They are still angry, and they want to hold Target accountable. “As long as corporations like Target think that it’s OK to plow money into political campaigns, we’re in trouble. Corporations are not people. We need to make sure that Target and each and every corporation in the country gets this message: Stay out of our elections!” So MoveOn has a problem with — as I do — corporate influence over elections as such. It turns out that Abe Sauer noticed the wording in MoveOn’s original campaign, and was concerned about their involvement from the beginning:

Jumping aboard, MoveOn.org launched a petition calling for 150,000 consumers to commit to a boycott. While welcomed by many, there is reason to be wary of MoveOn.org’s particular involvement. For starters, its statement reads “If we don’t push back hard, this will just be the tip of the iceberg. Other corporations will learn that they can pour money into elections to buy the outcome they want.” It essentially lessens the anti-gay rights part of the Target donation outrage in exchange for a focus on a larger battle about the post-Citizens United campaigning world… one in which MoveOn.org’s side benefits greatly. Some, like me, might use a stronger word than “lamentable” to characterize MoveOn’s failure to even once use the term “gay” in its petition.

My first reaction was that this is a perfect example of left-leaning advocacy groups engaging in turf wars rather than — like their right-leaning counterparts — keeping an eye on the big picture and working together in the spirit of solidarity. To put it bluntly, why can’t LGBT organizations keep hammering away at Target even after the apology as part of a common cause with the left regarding corporate influence over elections, much as the “pro-family” right backs the right-wing anti-tax movement?

But I’m not sure it’s so simple. For starters, a lot of the anti-gay family groups have lost a lot of credibility with Republican office holders, so it’s not clear that this strategy has worked to advance their narrow interests. But more broadly, there’s a simple incentive structure at work — you want to punish people who harm you and reward people who help you — and in this case, the Target CEO’s apology was something to be applauded.

Economy

Fewer Homeowners Are Underwater, But Only Because They’re Being Foreclosed Upon

By Pat Garofalo on Aug 9, 2010 at 4:40 pm

underwaterAccording to new data released today by the real estate website Zillow, fewer homeowners are underwater on their mortgage — those who owe more in payments than their house is currently worth — than were underwater last year. In 2009, 23 percent of homeowners were submerged, which has dropped to 21.5 percent today.

Of course, that still means that more than one in five homeowners is in the unenviable position of having a mortgage that’s bigger than the value of their house. And the reason for the drop isn’t that the housing sector is healing, but that “more homes entered the foreclosure process.”

“While some of the downward pressure on negative equity is coming from stabilization in home value trends, the larger factor is the enormous volume of foreclosures occurring within the stock of homes in negative equity,” said Zillow chief economist Stan Humphries. This makes sense because, as Charles Hugh Smith notes at DailyFinance, “the data confirms the common-sense expectation that there’s a direct correlation between negative equity and foreclosures”:

At this point, “there are 4.1 million homeowners with more than 50% negative equity,” meaning their homes are worth only half their mortgage.

Zillow noted that “foreclosures again reached a new peak in June, with more than one out of every 1,000 U.S. homes being foreclosed upon during the month.” According to Realty Trac, foreclosure are up in 75 percent of the country’s metro areas. “More than 3 million households are seen getting at least one foreclosure notice this year, and this record will be surpassed slightly at the peak of next year,” Realtry Trac estimated.

The foreclosure crisis is going to remain a rock on top of the economy, holding back any recovery, until it gets somewhat resolved. “It’s certainly a weight on the economy,” said Mark Zandi, chief economist at Moody’s Economy.com. “Nothing works all that well in the economy when house prices are falling.” But the programs that have come out of the Obama administration and Congress have not been on a scale commensurate with the problem.

The Home Affordable Modification Program (HAMP) has had nearly 40 percent of the borrowers who begin the program drop out, far more than successfully receive a permanent mortgage modification. And the fixes that Treasury has proposed for the program, while certainly helpful for the families that they reach, are simply too small to deal with the scope of the problem.

Last week, the Cleveland Federal Reserve Bank released research showing that the implementation of judicial loan modification in bankruptcy — known as “cram down” — is a good way to incentivize private loan modifications, as the banks suddenly risk having a judge unilaterally reduce the amount of a loan. Of course, legislation giving judges this ability has come up for a vote repeatedly in Congress, but has been defeated each time, prompting Sen. Dick Durbin (D-IL) to say that the banks “frankly, own the place.”

For more on The Forgotten Foreclosure Crisis, read today’s Progress Report.

Politics

Right Wing Smears Michelle Obama As A Modern ‘Marie Antoinette,’ Pushes Lies About Cost Of The Trip

By George Zornick on Aug 9, 2010 at 4:14 pm

In recent days, right-wing commentators have launched a series of attacks on First Lady Michelle Obama for going on vacation in Spain with her daughter Sasha and a small number of family friends. Some of the most vicious attacks:

– New York Daily News columnist Andrea Tantaros wrote that the “material girl” Michelle Obama is a “modern-day Marie Antoinette,” and that the Obamas “seem to fancy themselves more along the lines of international celebrities than actual leaders.”

– CNN’s Erick Erickson also wondered “How long before the Marie Antoinette comparisons start?”

– American Thinker’s Ralph Alter claimed that the “pampered” Michelle Obama has taken “maximum advantage” of her “unlimited expense account as first lady.”

– In a post titled “Michelle Obama Kicks It Euro-Style,” the blog Newsbusters called Michelle a “petty, selfish woman.”

– Mickey Kaus even speculated the trip could be the result of trouble in the Obama’s marriage.

Most of the attacks are based on the premise that the First Lady’s trip is costing American taxpayers money. Glenn Bleck told listeners that the trip “is costing you $75,000 a day,” and Tarantos claimed that Michelle Obama was bringing along “40 of her ‘closest friends.’”

Because the right wing has propagated so much misinformation about the size and cost of the First Lady’s trip, the Chicago Sun-Times’ Lynn Sweet published an article setting the record straight today. First, Michelle Obama brought only Sasha (Malia is at summer camp) along with two close friends, each of whom also brought their daughters. Second, the entire group paid for their own lodging and personal expenses. The New York Times reported that Michelle even reimbursed the government for the equivalent of two first-class commercial tickets for the flight on Air Force Two. (Her friends flew separately, on commercial flights). Finally, most of the rooms booked at her hotel in Spain belonged to Secret Service agents, and as Sweet wrote, “No matter where she goes — domestic or international — any first lady gets protection and she does not decide how many agents are needed.”

These right-wing commentators were curiously silent when the Bush family took vacations. The New York Times noted that Laura Bush took a vacation every year of her husband’s presidency, with Secret Service agents and a government plane. Also, Media Matters calculated the cost of President Bush’s frequent trips to his ranch in Crawford, TX, Camp David, and the family compound in Kennebunkport — he took more vacation time than any president — and put the tab at $20 million for air travel only.

These facts have not stopped the right-wing commentators from going into overdrive on this story, however. Perhaps they need a vacation.

Yglesias

Ironies of Empire

By Matthew Yglesias on Aug 9, 2010 at 3:57 pm

Who would have thought it figures: “U.S. forces are staying in Iraq to prevent foreign powers from meddling with the new government, Gen. Ray Odierno said Sunday.”

In defense of General Odierno, what he actually said was that his efforts will “make it less likely of others from the outside being able to interfere” which is probably true.

Climate Progress

Russian Meteorological Center: “There was nothing similar to this on the territory of Russia during the last one thousand years in regard to the heat.”

By Joe Romm on Aug 9, 2010 at 3:52 pm

Masters: Over 15,000 likely dead in Russia, 17 nations comprising 19% of Earth’s total land area set extreme heat records this year, July was “sixth straight record warm month in the tropical Atlantic”

Caption:  “A comparison of August temperatures, the peak of the great European heat wave of 2003 (left) with July temperatures from the Great Russian Heat Wave of 2010 (right) reveals that this year’s heat wave is more intense and covers a wider area of Europe. Image credit: NOAA/ESRL” — Jeff Masters.

Ria Novisti reports:

Russia has recently seen the longest unprecedented heat wave for at least one thousand years, the head of the Russian Meteorological Center said on Monday….

“We have an ‘archive’ of abnormal weather situations stretching over a thousand years. It is possible to say there was nothing similar to this on the territory of Russia during the last one thousand years in regard to the heat,” Alexander Frolov said.

He said scientists received information on ancient weather conditions by exploring lake deposits.

Frolov also said Russia’s grain crop may decrease by at least 30% compared to last year.

Once-in-a-thousand-year weather events ain’t what they used to be (see “Stunning NOAA map of Tennessee’s 1000-year deluge“).  And we’ve only warmed about 1.5°F in the past century.  We’re  projected to warm some 6 times that (!)  on our current emissions path.  So we ain’t seen nothing yet!

The BBC reports, “Moscow’s health chief has confirmed the mortality rate has doubled as a heatwave and wildfire smog continue to grip the Russian capital.”  The BBC repeats the “worst in 1,000 years of recorded Russian history” line, and quotes Frolov also saying, “It’s an absolutely unique phenomenon – nothing like it can be seen in the archives.”  But the BBC  is mum on global warming or climate change or greenhouse gas emissions.

At least  Russian leaders are starting to get (see Medvedev: “What is happening now in our central regions is evidence of this global climate change, because we have never in our history faced such weather conditions in the past”).

Meteorologist Jeff Masters has the full story on just what Russia and the rest of the planet is going through:

Read more

Justice

DADT Group Claims Discharge Of Lt. Col. Fehrenbach Would Violate Federal Law

By Igor Volsky on Aug 9, 2010 at 3:50 pm

Lt. Col. Fehrenbach

Lt. Col. Victor Fehrenbach

Over the last several years, Rachel Maddow has reported on the case of Lt. Col. Victor Fehrenbach, a decorated U.S. Air Force fighter pilot who received notice in September 2008 that he was being discharged from the Air Force under the military’s Don’t Ask, Don’t Tell policy. As Maddow noted, Fehrenbach defended America’s skies in the days after 9/11, and flew combat missions in Afghanistan and Iraq, for which he won the Air Medal for heroism. He has logged over 2,000 hours in the air, over 1,400 of those in fighters, and over 400 of those in combat.

During an appearance on Maddow’s show last month, Fehrenbach — who is still awaiting review of his case — said that he hoped that the military’s new “more humane” approach towards discharging gay and lesbian service members (unveiled by Defense Secretary Robert Gates in March of this year) would apply to his case. “As you know, those standards – some of the things you now see, my case meets all those standards. For instance, it was not credible information that was presented. It was not from a reliable source. And my chain of command did not take into consideration how that information was gained,” he said. “And then finally, it was clearly malicious intent involved by the person who outed me.”

But now, a new report from the Palm Center finds that the military’s new discharge rules don’t go far enough — at least not in the case of Fehrenbach, who was discharged within the jurisdiction of the 9th circuit court:

If the Pentagon discharges Lt. Col. Victor Fehrenbach without showing that he undermined his unit’s readiness, this would violate the 9th Circuit Court of Appeals decision in Witt v. Department of the Air Force, according to a new report. The 2008 Witt decision holds that gay and lesbian service members cannot be discharged on the basis of the claim that homosexuality generally is detrimental to unit effectiveness. Rather, the Pentagon must show that a service member undermined his or her unit if that individual is to be discharged under “don’t ask, don’t tell.”

The Witt decision applies only to service members based in the 9th Circuit, which covers Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington, Guam and the Northern Mariana Islands. At the time that he was reported for being gay, Lt. Col. Fehrenbach was stationed in Idaho. Defense Secretary Robert Gates said on February 2, 2010 that the Pentagon would “devise new rules and procedures in light of the appeals court decision in Witt versus the Department of the Air Force for the areas of the country covered by the appellate court.” Such regulatory revisions, however, have not been forthcoming.

The Witt decision, which came down on May 21, 2008, established a new constitutional standard for enforcing the ban against openly gay and lesbian servicemembers. “The Ninth Circuit was required to reassess the constitutionality of the policy in light of the United States Supreme Court decision in Lawrence v. Texas, 539 U.S. 558 (2003),” which ruled that “the Constitution protects the liberty of all persons, gay and straight, to enter into private, intimate relationships without interference of the government, unless there is sufficient justification for government regulation.”

Witt concluded that DADT might not meet the heightened standard of review used in cases involving constitutionally protected liberties and established a new rule for DADT discharges. Under these new rules — which the Pentagon has yet to enforce — the military must “demonstrate that the individual ‘undermined good order and discipline’ in his or her unit and that “the only way to preserve good order and discipline was to separate Maj. Witt, and that no lesser remedy, such as a single standard of appropriate conduct for gay and straight servicemembers, could satisfy the military’s needs.”

Prior to the Witt decision, the military could discharge individuals “regardless of whether the statements or conduct affected good order and discipline in the service member’s unit.” “The law allowed the military to rely on a general, hypothetical assumption that the presence of known gay service members automatically undermined military effectiveness, regardless of whether that actually occurred in any specific case.” As Matt Duss pointed out, given the millions of dollars spent on training servicemembers like Fehrenbach, this is the equivalent of “flushing tens of millions of dollars down the toilet.” Since 1994, the military has discharged more than 13,000 members at a cost to the taxpayer of some $363.8 million. And so long as the Pentagon continues to ignore the Witt precedent, the military will go on burning money and ruining lives.

Yglesias

Better Fewer, But Better

By Matthew Yglesias on Aug 9, 2010 at 3:14 pm

File:5.29.10NYPDByLuigiNovi6 1

Many commentaries today on the subject of public sector pay, my favorite of which are by Jonathan Cohn and Adam Ozimek.

But I would posit that the important issues here are different from the ones people are talking about. One key issue is the actuarial health of public sector defined benefit pensions. The issue here is that the health is poor. Whether or not the pensions are “too generous,” they’re as generous as they are and they generally aren’t funded properly. The other key issue is the quality of services. If it’s true that public sector workers earn more than superficially similar working in the private sector, then I don’t necessarily have a problem with that. After all, paying people more should mean you get better people. High quality people and high quality public services are important, and I’m happy to pay for them. But of course if we’re not getting high quality public services, then something’s gone wrong.

That strikes me as the crucial point. If there’s a change we could make that would reduce overall teacher compensation while not degrading the quality of education, then of course we should make it. My read of the landscape is that the reverse is probably true—there are changes we could make that would substantially improve the quality of American education, but they would almost certainly require an increase in overall teacher compensation since they involve decreasing teachers’ job security. Whether parallel situations exist in public safety services, I couldn’t say. Beyond that, at the state and local level I’m inclined to say that it’s more common to see people being paid to do things that really shouldn’t be done at all—does New York State really need people out there preventing the scourge of interior designing without a license?—than that they’re being paid too much per se. I would say that $0.00 is the right amount for Indiana to be paying people to oversee the licensing of hypnotists, and the Indiana legislature did the right thing by voting to abolish the hypnotist-licensing system as of this summer. But if I’m mistaken and it’s actually quite important to be licensing hypnotists, then we should probably be paying the licensers pretty well to make sure our candidates have sufficient psychic strength to resist being glamoured by the people they’re supposed to regulate.

When you think about the federal government, the people regulating the financial services industry pretty clearly need to be paid more so that their incentive is to do a good job and get promoted, rather than to do a bad job and cash in. Similarly, regulatory agencies with worthwhile missions need to be able to hire lawyers and scientists good enough to go toe-to-toe with industry stooges. But a regulatory agency with a non-worthwhile mission is by definition overpaying everyone it employs.

V.I. Lenin offered related thoughts in 1923 that I think are worth your time.

Security

Will The $600 Million Border Bill Make A Difference?

By Andrea Nill Sanchez on Aug 9, 2010 at 3:00 pm

borderLast week, Democrats introduced a $600 million border security bill that was passed under unanimous consent — reportedly, much to their surprise. The legislation includes $176 million for 1,000 new Border Patrol agents, $89 million for 500 additional customs and immigration personnel, $32 million to deploy drones, and $196 million for the Justice Department’s work along the border. Given that the House of Representatives may take up the proposal when it reconvenes from recess tomorrow, it begs the question of whether throwing another $600 million at the border will make a difference, practically or politically.

In practical terms, many experts have argued that focusing on the border may have some grave unintended consequences. Princeton University sociologist Douglas Massey and his colleagues, Jorge Durand and Nolan J. Malone, have carefully studied the effects of border security measures over the past ten years. What they found is that “border enforcement may have increased the size of the permanent Mexican population in the United States by a factor of nearly four.” That’s because a tighter border also constricts the movement of labor. In other words, undocumented workers who may have previously entered the U.S. on a seasonal basis chose to stay put as it became harder and more dangerous to leave and come back. Another effect that the experts don’t mention is the increasing profitability of human smuggling. The harder it is to cross the border, the more dependent migrants become on paying criminal smugglers to get them across the border and the more lucrative the human smuggling business becomes. And, as Rep. Henry Cuellar (D-TX) points out, “[a]s we have done more to secure our borders, alien smuggling organizations have increasingly become more bold, violent and dangerous.”

Apparently, the Democrats’ introduction of the border bill was also guided by political motivations. In the past, Republicans have rejected similar bills, arguing for much larger bills paid for with unused economic stimulus funds. Roll Call reports that Sen. Chuck Schumer (D-NY) initially proposed last week’s legislation and asked for unanimous consent, anticipating the Republicans would oppose it. Schumer intended “[to] expose whether people want to secure the borders or just want an issue” for this fall’s elections. According to Roll Call, most Democrats didn’t think Republicans would approve the bill and expected to prove a political point. However, not only did Republicans vote for the bill, Sens. John McCain (R-AZ) and Jon Kyl (R-AZ) added themselves as co-sponsors. At that point, Schumer pivoted, stating, “This bipartisan effort shows we are serious about making the border more secure than ever…Now our attention must turn to comprehensive reform, which is the only way to fully address the problem of illegal immigration.” However, as immigration advocates note, those opposed to comprehensive immigration reform will endlessly continue to demand more border security as a way to permanently stall actual solutions. They claim that “passing a stand-alone border bill eliminated a bargaining chip for Democrats.”

Ultimately, more enforcement without reform is a waste of limited resources and money. The border is already supposedly “safer than its ever been” and the best way to make it even safer is to provide economic migrants with the legal channels to enter the U.S. so border patrol can focus more on actual threats to public safety. While it’s true that it will be harder for Republicans to argue that Democrats are turning a blind eye on border security, they’ll continue to raise the benchmarks and generate more unintended consequences. If lawmakers really want to chip away at the problem in absence of immigration reform, experts suggest their best bet is to promote workers’ rights and the vigorous enforcement labor laws — an action which may actually succeed in catching the Republicans off-message and off-guard.

Security

Markey: Greenland Iceberg Has Created Space ‘For Global Warming Deniers To Start Their Own Country’

By Ben Armbruster on Aug 9, 2010 at 2:55 pm

Ed-MarkeyUniversity of Delaware climate researcher Andreas Muenchow said in a statement last week that, according to NASA satellite data, a massive ice shelf four times the size of Manhattan has broken off from north-western Greenland. Within hours, the Canadian Ice Service confirmed the report. “The new ice island has an area of at least 100 square miles and a thickness up to half the height of the Empire State Building,” Muenchow said.

The Hill reports that on Saturday, Rep. Ed Markey (D-MA), who has been leading the legislative effort to confront climate change, used the occasion to chastise his obstructionist colleagues:

“An iceberg four times the size of Manhattan has broken off Greenland, creating plenty of room for global warming deniers to start their own country,” Markey said in a statement. “So far, 2010 has been the hottest year on record, and scientists agree arctic ice is a canary in a coal mine that provides clear warnings on climate.” [...]

He said it was “unclear how many giant blocks of ice it will take to break the block of Republican climate deniers in the US Senate who continue hold this critical clean energy and climate legislation hostage.”

Indeed, the giant ice island highlights the need for Congress to act. An expert report on Arctic temperatures published in Science magazine last year found evidence “that the most recent 10-year interval (1999–2008) was the warmest of the past 200 decades”:

During the late 20th century, our proxy-inferred summer temperatures were the warmest of the past two millennia, with four of the five warmest decades of our 2000-year-long reconstruction occurring between 1950 and 2000. In recent years, the magnitude of the warming seems to have emerged above the natural variability, consistent with the sharp reduction in summer sea-ice cover.

According to a recent National Oceanic and Atmospheric Administration report, 2010 Arctic sea ice extent was the lowest on record for the month of June:

Arctic sea ice continued its annual decline, typically reaching a September minimum. Similar to May 2010, the Arctic sea ice continued to decline at a record rapid rate. … June 2010 Arctic sea ice extent was 10.9 million square kilometers (10.6 percent or 1.29 million square kilometers below the 1979–2000 average), resulting in the lowest June sea ice extent since records began in 1979—the previous June record low was set in 2006.

And he National Snow and Ice Center said last week that “Arctic sea ice extent averaged for July was the second lowest in the satellite record, after 2007″ and the trend is continuing downward.

Why are Arctic ice levels decreasing so rapidly? Numerous climate studies based on expert analysis have concluded that the trend in Arctic ice decline is a direct result of human activity.

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