Matt Zeitlin

Jim Manzi argues that an increase in gas taxes and/or a carbon tax won’t necessarily spur innovation in the energy sector. After all, Europe has had high gas taxes relative to the U.S. for a long time and so we would think that any gamechanging innovations would have already happened because of the huge European market:

Consider as an important example that most major Western European countries have had very high gas taxes – typically several dollars per gallon – for decades. But despite the efforts of lots of very smart engineers, the automobile has been a pretty stable technology for these same decades. Raising the price of gas does reduce consumption, and will of course induce some incremental innovation. But Western Europe seems to me to a big enough market so that if a low-carbon technology could be developed globally that was competitive with internal combustion in the face of a ~$5 per gallon gas tax, we already have a big enough end-use market to induce it. Why would increasing prices in America work when it hasn’t for Europe? There might be some carbon price that would radically accelerate innovation across the array of uses of fossil fuels (the limit case is simply outlawing coal and petroleum), but it has never, to my knowledge, been imposed anywhere at scale, presumably because it would impoverish any country that tried.

Ryan Avent speaks for everyone who has been to Europe — or has familiarity with their carbon usage and transportation policy — and points out that Europe’s transportation sector is hugely different from ours:

Clearly that’s not the case. In general, Europeans do drive different automobiles, which tend to be smaller and more efficient. Some of these have been innovative enough in their design to generate raised eyebrows from American tourists (see: the Smart car). In Europe, the scooter is far more popular and differentiated (the scooter with roof is a common sight). Bicycles are also more common and differentiated, and the institutional supports for cyclists are more highly developed (cycle superhighways are old news in Europe).

And then there’s public transport. From buses to trams to trains to high-speed rail, Europe is well ahead of America. When American transit systems go shopping for vehicles, they generally look to European manufacturers. When the District sought a technology that would allow the city to run streetcars without using overhead wires, it looked to France’s Alstom and Canada’s Bombardier (Canadian gas tax rates are considerably higher than those in America). And transit innovation goes beyond vehicle technologies. It includes fare-gathering methods, scheduling, system design and maintenance, and so on.

And this isn’t just a qualitative difference. Not only is it vastly easier to get around using public transportation in Amsterdam than it is in downtown Los Angeles or Houston, but Europeans simply use much less carbon in their transportation sector than we do. And here’s a nice handy chart, using data from the International Energy Agency. This is the per capita carbon emissions in the transportation sector in 2007 of the U.S. and an assortment of wealthy European countries.

Obviously, there’s a huge difference: the U.S.’s per capita transportation emissions are roughly three times greater than the OECD-Europe average. And it’s a disparity that can be greatly explained by the array of policies and the infrastructure that Avent describes. More generally, I think Manzi’s focus on “innovation” — some totally new or vastly more efficient method of energy production — is misplaced. Although it would hardly solve our climate change problems, if we could get the emissions in the transportation sector down to European levels, that would be a huge improvement. More generally, according to McKinsey, there are huge potential gains in energy efficiency that would surely be more easily realized if the cost of energy, and especially carbon, were higher.

Michael O’Hare has an excellent post that’s really about how we think and talk about public policy and has very little to do with either apples or baseballs.

Matt Yglesias wryly notes that Max Boot’s thesis that post-conflict decreases in defense spending are actually what cause further wars seems to get causation screwed up: it’s far more likely that the existence of conflict is what drives the increases and decreases in defense spending and not the other way around. But Boot’s Washington Post piece is useful because it shows that the sheer amount of defense spending — as oppossed to spending on any given defense project — is not all just pure waste that is only funded because of pernicious lobbyists and congressman who want jobs in their district, but is actually the result of a bipartistan consensus that America have gargantuan, worldwide defense obligations:

We are still suffering the consequences of the post-Cold War drawdown. The Navy is finding it hard to fight Somali pirates, police the Persian Gulf and deter Chinese expansionism in the Western Pacific. The Army and Marine Corps are forced to maintain a punishing operational tempo that drives out too many bright young officers and NCOs. The Air Force has to fly decades-old aircraft until they are falling apart

So, if you’re Max Boot and think that the U.S. ought to be fully capable of preventing piracy in the Indian Ocean, policing the Middle East, checking China’s rise as a regional hegemon and being able to deploy bombers and fighters all over the world at a moment’s notice, then defense spending as a portion of GDP ought to remain relatively high. If you disagree with Boot about what American defense policy should be, then you will think that defense spending should be fairly low. What doesn’t work is thinking that the U.S. should maintain our status quo policy stance and that that policy stance can be funded with a lower portion of our national wealth if only we were better at allocating the budget. This is not to say that the stuff Robert Gates is doing to reorder the Pentagon’s spending priorities and reform the procurement system isn’t worthwhile, but we shouldn’t confuse it with an effort to decrease defense spending as a portion of GDP.

This distinction tracks pretty neatly onto the discussion of earmarks and deficits. Lots of people say they are concerned that the government either spends too much or spends too much relative to its incoming revenue. But a common, popular policy response is to demand some kind of earmark reform, which doesn’t actually reduce the deficit or shrink the budget, but merely changes how the budget is allocated.

Ultimately, all this stuff is driven by policy choices, and no matter how good we get at formulating and executing those policies, it’s the big-picture decisions that matter.

I don’t want to specifically rag on Kathryn Jean-Lopez, but she’s the most recent example of someone saying that poll result in an election race is “ within the margin of error.” She seems to want to say that, in a Rasmussen poll of the Nevada senatorial race where Harry Reid leads Sharron Angle  leads 45% to 43% with a margin of error of 4%, the difference being smaller than the margin of error means that the poll is especially close. Now, it’s not at all clear why the margin of error being higher than the margin is all that significant — 2% in one poll is plenty close all on its own. Especially when you think of what margin of error actually means. It doesn’t mean “x% fudge factor that makes margins in polls basically insignificant.” So, what does it actually mean. Well, I turn to Matt Rognlie, who wrote a great post on journalism and statistics where he discusses margin of error. It’s a bit long, but it’s worth reading in full:

If a poll’s margin of error is 5% and Obama polls 52%, this result is not“statistically indistinguishable from a tie.” You’d think that this would be evident using a little basic logic: if 52% is statistically “indistinguishable” from 53%, which is in turn the same as 54%, and so on, transitivity implies that 52% is indistinguishable from 100%, which is clearly false. Alas, journalists’ desire to display what they perceive to be statistical sophistication gets ahead of them here, as a snappy-sounding declaration that two numbers are “statistically indistinguishable” impresses the editor enough to get by. Yes, 52% is very close to 50%, and there’s a substantial chance that the real figure is below 50% — but even with this very narrow margin, it’s more likelythat the actual figure is above 50%, meaning that the poll result is hardly “equivalent” to a tie.

Indeed, the “margin of error” is nothing special at all. It’s based on the arbitrary choice of a 95% confidence interval, which in turn only deals with easy-to-quantify sampling error. That’s the error you get when you select 1000 voters, in a perfectly random way, from the population; even if your method of selection is perfect, there’s inevitably some error resulting from the fact that you haven’t sampled the entire population. As it happens, this isn’t the most serious error you get in polling, because it can be aggregated away: the average of 4 polls, each with a 5% margin of error, no longer has a 5% margin of error. (Journalists tend to be obtuse here as well, and often talk about how averages of many polls are within the “margin of error,” even when the margin of sampling error is much smaller in the aggregated sample.)

The real danger in polling is that the method for selecting the sample is flawed, a danger that lies outside the “margin of error” concept altogether. Maybe you’re oversampling elderly white women, or disaffected former construction workers. Indeed, pollsters find this to be such a problem that they implement ad-hoc demographic “weighting” procedures to correct for it. But even if you’ve pinpointed the percentages of every racial, gender, and age category in the voting pool — no mean feat, because these percentages fluctuate from year to year — you’re left with the possibility that you’ll systematically oversample voters of a particular political persuasion, even if you’ve compensated using all the obvious demographic markers. In this sense, the margin of sampling error (the one you see on press releases) is actually a lower bound on the true margin of error, and depending on the pollster can be a very serious underestimate indeed.

David Leonhardt has a nice piece in the Times discussing yet more research showing that investments in early childhood education have a huge social payoff. He specifically discusses new research using the results from Project Star, a study conducted in Tennessee between 1985 and 1989 where kindergarten kids were randomly assigned to classes. What’s itneresting about looking at the outcomes of the participants, now in their 30s, is that when they advanced through the school system, the test scores of the kids who were in the classes with exceptional teachers fell by middle school. This is a quite common result in many of these types of studies, but apparently when you extend the time-frame out to life outcomes as adults — or at least relatively young adults — good kindergarten classes have real effects:

Students who had learned much more in kindergarten were more likely to go to college than students with otherwise similar backgrounds. Students who learned more were also less likely to become single parents. As adults, they were more likely to be saving for retirement. Perhaps most striking, they were earning more.

All else equal, they were making about an extra $100 a year at age 27 for every percentile they had moved up the test-score distribution over the course of kindergarten. A student who went from average to the 60th percentile — a typical jump for a 5-year-old with a good teacher — could expect to make about $1,000 more a year at age 27 than a student who remained at the average. Over time, the effect seems to grow, too.

Or, in handy chart form:

Leonhardt thinks that peer effects (being around kids who will do well anyway) and class size can only account for so much of the gains that come from being in a high test-score class, and suspects that teachers would make up for much of the rest of the effect. And apparenlty on the authors, John Bates Clark medal winner Emmanuel Saez, thinks that kindergarten teachers might be “worth” up to $320,000 a year*. The specifics of the number are not all that important (it’s the “present value of the additional money that a full class of students can expect to earn over their careers”), but it just goes to show that, following reams of economic research, that early childhood interventions, especially in education, have massive effects in terms of life outcomes.

I think, however, Leonhardt fudges on one thing. He points to this research as showing that education has a real effect on outcomes. He refutes both conservatives – he identifies Ramesh Ponnuru and Charles Murray — “who suggest that people who haven’t graduated from college aren’t smart enough to do so” and left wingers like the good people at the Economic Policy Institute who “argue that an education can’t protect workers in today’s global economy.” Of course, the EPI view of the world can be true and it can also be true that good education at a young age will, on balance, mean higher wages later on in life. But I also don’t think that Leonhardt is quite right that this new research, or some of the other research he cites, refutes those who think that it’s hard to suss out the effects of higher education beyond simply sorting the smart from not-smart and the belief that possession of a undergraduate degree — especially a prestigious one — must mean that someone is smart and well qualified. It’s still hard to figure out the value-added of higher education.

But that doesn’t mean it’s hard to find value-added in early education. There’s tons of it. And this new research and plenty of past research indicates that, as a society, for reasons of both justice and utility, early childhood education is something that should get much more attention and resources.

* I don’t know if Leonhardt talked to Saez to get this number, but the slides that Leonhardt links to in the piece say that, holding class size steady at 20, a teacher whose quality is one standard deviation above the mean is worth, using that present value calculation, $240,000 a year. I don’t know where the extra $80,000.

I generally do want to be in a situation where I’m disagreeing with Matthew Yglesias and Matthew Rognlie — someone who blogs way too little for how smart he is (he’s going to MIT in the fall to start his economics PhD) — and I do not know if I disagree with them in their argument for why it might be OK for employers to look at credit reports when they hire people (for the opposing view, check out Kevin Drum), but there’s a slight wrinkle to this debate that I do not think the illustrious Matts are considering.

Aside from the general point that liberals ought not to spend their time regulating business aside from dealing with externalities, Rognlie argues that there might be a good reason that employers would want to get a look at the credit history of prospective employers. So, we should generally trust employers to know whether or not it’s true that someone with worse credit will be a worse employee, and that if we find out that this is a totally baseless idea, then regulatory action can be considered. This sounds reasonable enough, but I don’t think it reckons with the possibility that a worse credit score, could be meaningful and it would be wrong for an employer to look at it. Let’s look at another fact about someone that employers have used as a proxy for other qualities they are looking for in an employee: race.

As we all know, labor market discrimination by race is both immoral and illegal, but it happens, and it doesn’t just happen because people are evil, but because there is an empirical element. Tim Harford had a great piece from a while back in Forbes where he talks about taste-based and statistical discrimination. The former is when employers just don’t like ethnic minorities and are straight-forward bigots and the latter is discrimination that happens because certain racial and ethnic identities are used as markers for other traits that matter to employers. Both, of course, are morally wrong and illegal, but the latter is hard to root out because, absent regulatory or legal pressure, employers will benefit from statistical discrimination, or at least they won’t suffer from it. From the perspective of the qualified black guy who can’t a job, there’s no difference between the two types of discrimination:  he’s still being judged based on his group identity as opposed to his individual qualities.

So, when we talk about what type of information employers should either have access to or should make employment decisions based on, we can’t just talk about what information correlates with more valid and appropriate qualities of a prospective employee.

I think Drum might be on to something when he says that we should not let employers look at credit history, just as we don’t allow employers to use race to evaluate prospective employees on race (although, of course, we can’t stop them from observing it). But the reasons for not allowing credit history have to be extra-economic, because we know that statistical discrimination can both be rational and wrong. The reasons for protecting credit history are both that it’s information that is traditionally private and protected — I don’t think Rognlie or Yglesias agree that anyone should have access to the credit history of their neighbors, friends and acquaintances – and that it can create a situation where the poor who are more likely to have a spotty credit history can not get jobs because of their spotty credit history and their credit situation gets worse and then can’t get a job, and so on and so forth. Sometimes, considerations of justice need to outweigh the short-term justification for the powerful in labor markets. Much the same situation exists in hiring ex-cons. Surely it’s a case where statistical discrimination makes some sense, but as a society, we are worse off when ex-cons have a very hard time entering the labor market because it both extends their punishment past the one handed down by a judge and, when convicts can’t get jobs, they are more likely to commit crime.

This is not to say that any and all statistical discrimination is something the government should try to prevent or that mucking around in labor markets is the right thing to do, but everyone accepts that such mucking around is OK in some circumstances, and those reasons might justify doing so in other cases.

*Yikes, just after writing this post, I realized that Rognlie wrote another post incorporating a response to the kind of points I made. But I just spit out hundreds of words on this, so I’ll just link to Rognlie’s follow-up.

*For more great Rognlie stuff, here’s his defense of Fahrenheit and “Preference Functions That Score Rankings and Maximum Likelihood Estimation“

Yesterday, DealBook had a solid story on corporate boards and executive pay. One of the standard explanations for the rise in executive compensation goes like this: executive stock boards with friends, other executives and people who are generally inclined to signing off on high compensation packages and are not the fiercest advocates for shareholders. A new study, the one repord on in DealBook adds another wrinkle to this story. Boards will use peer companies to see what they should pay their executives. This seems sensible, but here’s the twist: “companies usually benchmark their executive pay with peers in their industry group, but that they also choose peers that pay more than others.” So, companies tend to look at the highest paid peer-executives, which then sets new-benchmarks for executive pay, leading to an upward spiral as the higher paid peers become ever higher paid.

This is a distressing situation for shareholders obviously, put I think that we have a system where nearly everyone knows that the ever increasing pay of many executives in publicly held companies is only tangentially related to merit should shed some light on the idea, now resurgent on the right, that our debates about economic policy are actually cultural. By this they mean that conservatives generally support the idea that business should be allowed to fail, that economic success should not be tied to good relations with the government and that excessive social support saps certain values: thrift, independence, prudence etc, that are key to society-wide economic success. As I’ve written before, the huge increase in inequality in the last 40 years, much of which is due partially to finance salaries exploding and also to CEO pay increasing without a great underlying reason seems to indicate that this thesis might not be correct, that there are other forces subverting merit and earned success besides liberal regulatory policies and social programs. And yet, you don’t see conservative get up in arms about executive compensation. Curious, that.

Let’s, for a moment, put aside the substantive question of whether or nor Neel Kashkari’s proposals for cutting entitlement  spending to shore up America’s long term fiscal position that he published in a Washington Post op-ed. Does anyone — Pete Peterson, Hank Paulson, Neel Kashkari — think that the guy who was in charge for disbursing hundreds of billions of dollars to the financial institutions responsible for an economic downturn that necessitated tons of deficit spending and eviscerated tax revenues, used to work for Goldman Sachs and now works PIMCO is the best guy to make this case*? Is there any way to get people to react more negatively to cutting middle class entitlements than to get the TARP-master to publicly praise them?

*I, for the record, think that TARP was basically a good program that, while troubling on the issue of moral desert, was probably necessary to save the economy from truly unparalleled disaster.

Obviously you should not be coming here for substantive analysis of the trove of documents released by wikileaks and reported on in the New York Times, Guardian and Der Spiegel. My basic read is that there isn’t a whole lot new there. The wide contours of the story as reported in the English language newspapers — that the war effort isn’t going very well; that civilians are being killed in disturbing numbers by both the Taliban and NATO forces; and that parts of Pakistan’s intelligence infrastructure support the Taliban — are just depressing facts and narratives of the war that we’ve known for a while.

But what’s really interesting is how Wikileaks managed to make its materials news. Although they hadn’t quite gotten raw data as inherently interesting to news organization as these war logs, there has been a problem and there will be a problem with Wikileaks having all sorts of raw data, but news organization lacking the incentive to trawl through it. They might do this because they don’t want to legitimize a website that, while in this case is a source, is also a competitor with a markedly different approach towards information gathering and dissemination. Another reason is that any raw document on Wikileaks  can’t be a scoop for a newspaper. A newspaper has little incentive to comb through Wikileaks to find a story when their competitors might be doing the same thing and getting the story out earlier. So, Wikileaks has made some compromises with its leveling, non-hierarchal ethos of releasing as much stuff as possible as soon as possible in order to get more credibility for their disclosure by letting respected, mainstream news organization report it out and it’s tacitly admitted that document dumps qua document dumps are only so useful and that for any information to be actually useful or interesting to the public, smart people who know the context and have the skills to put into a narrative are still necessary.

The debate on whether or not to extend the Bush tax cuts may not be political salvation for the Democrats, but it will at least be interesting. The basic situation is that Democrats want to extend the tax cuts for those making under $250,000 and Republicans want to extend the tax cuts for everyone. Putting aside the policy implications of these two positions (hint: the GOP’s stance would further explode the deficit), I think that this may be an area where the Democrats could put the GOP in a weird position.

Jon Chait gets at this dynamic in a very good post: the Democrats can set the agenda on tax cuts and they can propose a bill that will only extend them for families with incomes under $250,000. And their backup or baseline position could be to let all the tax cuts expire. Republicans would then be put into a position where they would either have to vote against continued low-ish tax rates for the middle class or vote for a package that would, by default, increase tax rates on the rich. The problem for the GOP is that their strongest constituency — ideologically, institutionally, financially and so on — are people who care more than anything about income rates on the wealthy being as low as possible. So this might mean they won’t vote for the Democrats’ plan for fear of losing support from those who want taxes to stay low.

Either way, the GOP is in a weird position where they are going to either just sign on to the Democrats’ proposal (which, of course, is highly unlikely) and anger their supporters or they go on record as supporting a tax increase on the middle class for the sake of trying to protect the wealthy.

But this all depends on Democrats in the House and Senate being united on the tax cuts all expiring as a preferable option to the tax cuts all being extended. They have to credibly commit to saying that they would rather everyone’s taxes go up than have everyone’s taxes go down.  This, of course, is unlikely. A gaggle of Democrats  – like Kent Conrad and Ben Nelson — have made noises about supporting across the board extension. If enough Democrats defect so that the tax cuts are all extended, that would be a disaster for Democrats politically and for the country substantively.

Also, the WSJ has an excellent piece on the policy and political implications of the tax cut debate. It includes this excellent chart

Charles Fried has a dual nature.

On one hand, he was solicitor general during Reagan’s second term, and one of the most prominent lawyers in the conservative legal movement. But he’s another thing. He’s a Harvard Law professor with degrees from Princeton, Oxford and Columbia. He’s been on the faculty at Harvard, on and off, since 1961. This means that he’s made his career — apart from his stint as Solicitor General and in other parts of the Reagan administration in the 1980s — in liberal institutions like Harvard and the Massachusetts Supreme Court. Not surprisingly, he has a very good record of  getting along with liberals and has probably been constantly surrounded by smart liberals for nearly 50 years. And especially smart liberals who are affiliated with Harvard or are in the Cambridge academic community. Despite past public support for McCain and an early affiliation with the Giuliani campaign, he ended up endorsing Obama and is something of a moderate these days, especially on social issues.

Now, Fried is somewhat removed from the political fray except when he comes around to endorsing liberals, especially liberals associated with Harvard. This shouldn’t be surprising, he’s not that conservative and he’s been ensconced in an instituion that has either employed and instructed the best liberal legal minds. Not only did he endorse Obama, he’s also been a vocal supporter of Elena Kagan, his former boss at Harvard Law. Kagan even slyly worked in a humorous faux-apology to Fried after she mentioned him: he was sitting in the gallery in support of her.

I don’t say this to impugn Fried’s judgment: I’m sure he endorsed Obama and praised Kagan honestly. But keep in mind that Fried tends to go to bat for obviously smart, well-educated liberals who are affiliated with Harvard Law School when you see this Jonathan Cohn post detailing Fried’s positive thoughts on Elizabeth Warren, the Harvard Law professor that many want to see head up the new Consumer Financial Protection Bureau. This isn’t a case of a conservative taking off his ideological blinders to recognize the competence and good will of a liberal, it’s Charles Fried doing what Charles Fried does.

One thing I dream about is coming into a lot of money and buying a magazine or starting my own. Obviously, this would be good for me — people would know who I am, I could go to cool parties, meet cool people and I wouldn’t have to worry about getting a job in journalism. But I think it could also be good for the rest of the world, because one of the things I would do is pay Jonathan Rauch a healthy amount and encourage him to write as much as possible. It’s quite unfortunate that the National Journal stopped doing this, but Rauch is still out there, writing good stuff. I don’t have much to say about his take on family structure and gay marriage, but this little bit is pretty interesting and sheds a more nuanced light on exactly what the gay marriage debate is about:

Contrary to what some of my friends in the gay-marriage movement believe, however, homophobia is far from the only reason for opposition. Another group, which I think is at least equally large, feels threatened—less by the normalization of homosexuality than by the abnormalization, so to speak, of the conventionally defined family. “Nothing personal, do what you want,” they tell us, “but leave the definition of family—of marriage—alone!”

One way to see that more is going on than homophobia is to reflect, for a moment, on a peculiar fact: gay marriage is far more controversial in America than either same-sex adoption or same-sex child custody.

Think about that. Isn’t it odd? The care of children, by definition, involves third parties who often have little or no choice about their situation. If there is a case for harm, one would think it would be strongest here—not in the union of two mutually consenting adults. In fact, the other side has a very hard time articulating any concrete harm at all that gay marriage would do. Yet efforts to make a political issue of gay adoption have consistently failed, while, wherever it appears, gay marriage finds it cannot not be a political issue.

What is behind the alarm raised by gay marriage?

Ryan McNealy makes gentle fun of the new arm of the Heritage Foundation, Heritage Action for America, a kind of slightly more political organization that can criticize parties and promote specific pieces of legislation, like the Center for American Progress Action Fund. Yet, except of promoting anything positive, their four action items are rejecting energy legislation, delaying the Kagan vote, repealing Obamacare and voting against the new START treaty. McNealy argues that this is a rather negative agenda and might not befit a movement that is particularly ready — or excited — to govern and that “maybe just promoting a single idea would help assuage fears that the conservative movement is not ready to govern”

I’m of two minds on this. McNealy certainly has a point, but I think that most progressives opportunistically say that Republicans and conservatives don’t want to govern as just a way of saying that liberals and conservatives disagree on what the content of governing is. For example, conservatives don’t seem to think that climate change is a problem, and so won’t support legislation to deal with it. Conservatives do, however, think that taxes are two high on wealthy people and are too high on capital and investment and so have lots of plans to lower taxes. They think that our military doesn’t spend enough, and so have plans to increase military spending. They think Social Security is too generous and expensive and should be partially privatized and have plans to deal with that. And so on and so forth. Conservatives controlled both Houses of Congress and the White House on and off for six years and accomplished a lot and tried to do even more.

But back to Heritage Action for America. I can’t really blame them for just promoting opposition to Obama’s agenda. Right now, conservatives aren’t in any position to put forward any legislation. But, because of the 60 vote senate, they are in a position to block a whole gamut of it and, if blocking legislation means that voters get angry at “Congress” and thus congressional Democrats in the majority, then Republicans win. So, we have a situation where Republicans can’t do anything but oppose and will politically benefit from it.  Hard to really blame them for doing what they’re doing.

Kent Conrad is very concerned with the deficit. He says he is and many people seem to believe him. He also supports extending all the Bush tax cuts — not just those for the middle class — for at least a year. This one year extension, according to the CBO, would cost some 116 billion dollars and wouldn’t be all that stimulative, and yet we have a situation where two crucial centrist Democrats support the extension along with the entire Republican caucus. And, the Republicans are constantly braying about rising deficits.

Now, contrast the support tax cut extension has from those who talk the most about the deficit with a proposal among some left-wing Democrats in the House to revive the public option. This is from the CBO:

CBO and the staff of the Joint Committee on Taxation (JCT) estimate that the proposal would reduce federal budget deficits through 2019 by about $53 billion. That estimate includes a $37 billion reduction in exchange subsidies and a $27 billion increase in tax revenues that would result from changes in employment-based coverage, partly offset by an $11 billion increase in costs for providing tax credits to small employers. (The proposal would have minimal effects on other outlays and revenues related to the insurance coverage provisions of PPACA.) The bulk of those effects would occur in the second half of the decade; the savings estimated for 2019 are about $14 billion. Although CBO and JCT have not yet extended to 2020 the models they use to estimate insurance coverage, the proposal would probably reduce the federal budget deficit by about $15 billion in that year, bringing the total budgetary savings through 2020 to about $68 billion.

At the core of two recent substance-free media contretemps — the New Black Panthers voting rights controversy and the Sharon Sherrod video — is an effort by conservatives to do two things. One is to just be able to call liberals racists. This strategy has an obvious appeal: conservatives always complain about how they are being unfairly called racist and so they will jump on anything to be able to turn that toxic charge around on liberals. The second thing they are trying to do is a bit more insidious. At the heart of much of the conservative opposition to Obama is the idea that his policies are transferring money and resources from the productive to the unproductive, or as they are sometimes called, parasites. This idea is expressed crudely in tea party billboards that scream “Party of Parasites” and more elegantly in Arthur Brooks’ new book The Battle (reviewed/skewered by Brink Lindsey here) but the basic idea is the same: there is a productive class of people, generally portrayed as small businessmen from rural and suburban areas who are being taken advantage of by the government in the form of taxes, regulations and redistribution for the sake of well connected, megawealthy bankers who get bailouts and the “parasitic” poor who are the recipients of welfare an safety-net spending. Even when expressed in race neutral language, these complains have a certain racial tint to them.

The place where these complaints about the government favoring the parasites becomes more clearly racial is when people like Representative Steve King says ” the President has demonstrated that he has a default mechanism in him that breaks down the side of race – on the side that favors the black person.” If you thought this was true, then the entire New Black Panthers controversy and the initial impressions of the Sherrod video would make a lot of sense — the Justice Department is coddling black radicals who want to intimidate white voters and the Agriculture Department is staffed by people who won’t help white farmers on account of their race. Of course, locally, neither of those two impressions are at all accurate, but thinking more broadly, conservatives like Breitbart are either being very cynical and playing on the fear some white people have of a government that only favors blacks or they are openly trying to fan racial tensions in a dark and disturbing way. When King came out and said that the Obama administration systematically favored black people over whites, Ta-Nehisi Coates had a great post where he wrote that this charge that the government was favoring blacks is in fact “an old and racist appeal aimed squarely at a particular citizen, nursing the most ancient of American resentments.”

Whether or not Breitbart is aware of what he’s doing or is just trying to stoke outrage, I do not know. But either way, it’s ugly and irresponsible.

I think Jonathan Chait has the best analysis of the two conservative media shitstorms that turned out to just be evidence of dishonesty on the behalf of Andrew Breitbart for his misleadingly edited video of Shirley Sherrod and the Daily Caller’s misleadingly reported story on emails that they claimed showed liberal journalists wanting to shutdown Fox News but actually showed nothing of the sort.

Chait argues that the Daily Caller and Breitbart — despite being ostensibly journalistic organizations — see the media and any collection of liberals as enemies that need to be defeated, not a culture that has issues with liberal bias and a group of people they disagree with. So, they don’t really care about being misleading or racially inflammatory, as long as it damages liberals or the media (which, of course, for them, are the same thing), it’s totally fair game. This is the culture of campaigning — and especially opposition research — now being transmitted into the never ending dispute between die-hard movement conservatives, the mainstream media and liberals. As Chait points out, we know from actual political campaigns that opposition research can lead to good stories, assuming that journalists who aren’t campaign operatives actually look into the charges and report them out themselves. With Breitbart and the Daily Caller, we now just have the undiluted opposition research without any mediation or concern for truthfulness or balance, even though Breitbart claims to be something of a journalist and the Daily Caller is ostensibly a journalistic organization.

Also, I hope that the response to Breitbart especially is that the White House, political organizations, liberal advocacy groups and the media will not take anything he puts out — especially videos — at face value and realize that he is solely concerned with making liberals bad and has essentially zero interest in anything else.

Derek Thompson at the Atlantic posted this chart showing long-term unemployment being not only at a locally unprecedented high due to the recession, but also at a scary level even compared to other recessions. Or as he put it, the median duration of unemployment is more than double than at any point since 1965. Obviously we are in the midst of a recession induced depressed labor market that is noteworthy for just how bad at is in terms of gross number of unemployed, people dropped out of the labor force and the mismatch between job-opening and the unemployed which is leading to such a long median durations of unemployment.

But this question of the scary labor market now is only part of a more long term story of how the labor market has been deteriorating for a while, even before the recession. Just eyeballing the graph, with the exception of the Federal Reserve stoked disinflating recession, the second highest median unemployment peak was the one following the early 00s recession and the peak before that follows the early 90s recession.

A paper published in July 2005 by the Federal Reserve Bank of Boston detailed how “Measured relative to the business cycle peak in March 2001, labor force participation rates almost four years later have not recovered as much as usual, and the discrepancies are large.” And because this paper focuses on the lack of recovery in labor force participation, it turns out that the decrease in unemployment following the last recover was actually understated, “because participation declined fairly consistently from 2001 on, the rise in unemployment during the recession also understated the severity of the slowdown.”

So, what to do about seemingly structural problems that are making the labor market less robust and about our current problem of an incredibly weak, recession-battered labor market? Well, for the latter, we should probably be trying for growth-inducing policies without many worries about inflation. But more generally, we have a long-term problem of education, human capital and job training. The usual way of looking at this problem is to bemoan our relatively poor educational system, but another way of looking at it is to examine that, despite our relatively open labor market compared to some other developed countries, we spend a relative pittance on “active labor market policies”: things like job training, employment subsidies, placement services, and job counseling for the unemployed. According to The Economics of Imperfect Labor Markets,  in 2006, the U.S. spent about .13% of GDP on these programs, the lowest of any OECD besides Korea,  while Denmark spent 1.74%.

If we are going to continue to have recessions with weak recoveries in the labor market, it is because of a wide range of policy failings besides sub-par growth and it’s not something we are really talking about enough.

OK, I’m not really against family farms, I think they should be treated like other business for tax and regulatory purposes, not be given silly subsidies and, when parents bequeath them to their children, they should be treated no differently than other businesses or assets that are included in the estates of dead people.

Jonathan Cohn has an excellent letter he posted at his blog from the child of Midwestern farmers who makes the incredibly simple case for why the mere possibility that heirs might have to sell their parents farm should not drive us to adjust the estate tax so that it hits only the very wealthiest of the wealthy.

First, farms oftentimes receive massive amounts of federal subsidies, so it’s unclear why they should get supports in both direct expenditure and in an absurdly narrow estate tax. Second, romanticism about “family farms” in political discourse is nearly always a way for some powerful interest — whether it be agricultural companies receiving subsidies or incredibly wealthy families who want to avoid the estate tax — to either get something from taxpayers or avoid paying their fair share. So, I think that there should be a group of us who react universally strongly and negatively to any policy that’s in support of “family farmers” to at least balance out the sentiments at play.

Not only was U.S.C. hit with a whole host of harsh sanctions, including vacating its 2004 BCS national title, for giving perks and benefits to Reggie Bush and O.J. Mayo that ran afoul of NCAA regulations,  Reggie Bush played for them after receiving all sorts of benefits and perks like “multiple cash payments, a house for Bush’s parents, an automobile outfitted with rims and a stereo system, airfare, hotel stays, limousine service, meals, auto repairs, clothing, furniture and appliances.” What’s weird is that Reggie Bush is now getting punished by USC, which is sending back their copy of Bush’s Heisman trophy.

First, I disagree with the entire idea that Reggie Bush, who was essentially forced to play in college for a certain number of years before he could get paid to play football, risked lifetime injury and generated millions in revenue for the NCAA, USC and the Pac 10, is getting an individual achievement award rescinded or is being at all punished by the NCAA or his school. While it makes some sense that USC be punished for breaking rules that they ought to have followed in the recruitment and retention of their players and so, in some sense, their wins in 2004 are illegitimate, there is no reason to think that Bush’s performance is somehow suspect. Of course, Bush is doing OK — he’s still in the NFL and making millions of dollars — but this is just another example of the fundamental injustice of big-time collegiate sports and moreover, the institutional mismatch between what’s essentially a minor league for the NFL and universities whose responsibilities and obligations have very little to do with sports.

Pete Hegeseth, a conservative Army National Guard captain, opposes Elena Kagan’s nomination to the Supreme Court because of her supposed ill-treatment of the military when she was dean of Harvard Law School and she denied the military access to the Law School’s Office of Career services because of their discriminatory policy against openly serving gays and lesbians: Don’t Ask, Don’t Tell. And he’s written an op-ed for the Wall Street Journal to further express his opposition. One point he makes that one sees pop up in conservative criticisms of Kagan is how she was punishing the military for implementing a discriminatory policy that was forced onto them by Congress and the Clinton administration, who respectively passed and signed the legislation:

She knows that the policy she “abhors” is not the military’s policy, but a policy enacted by Congress and imposed on the military. In fact, after the law was passed in 1993 Ms. Kagan went to work for the very man who signed it into law—President Bill Clinton. Her calling it “the military’s policy” is intellectually dishonest, and she knows it.

First of all, the provenance of the DADT policy is somewhat immaterial. Sure, Congress  passed the bill and Clinton signed it, but it’s not like Congress or the Clinton administration themselves had a discriminatory policy against hiring gays and lesbians; the military did. Furthermore, Hegseth is the one being dishonest here. Apart from the pedantic technicality that Congress and the President are responsible for laws, anyone who knows anything about the political and legislative history of DADT knows that it was a policy implemented and conceived at the behest of a military establishment that would have been more than happy to keep the Defense Department’s old policy on homosexuals in the military: a complete and total ban. Here is the DOD’s “policy on homosexuality [that] was formalized in 1982″ and was in effect prior to DADT:

Homosexuality is incompatible with military service. The presence in the military environment of persons who engage in homosexual conduct or who, by their statements demonstrate a propensity to engage in homosexual conduct, seriously impairs the accomplishment of the military mission. The presence of such members adversely affects the ability of the Military Services to maintain discipline, good order, and morale; to foster mutual trust and confidence among servicemembers; to ensure the integrity of the system of rank and command; to facilitate assignment and worldwide deployment of servicemembers who frequently must live and work under close conditions affording minimal privacy; to recruit and retain members of the Military Services; to maintain public acceptability of military service; and to prevent breaches of security.

Furthermore, according to a GAO report written in 1992 (from which I pulled the DOD policy), the DOD defined a homosexual as “a person, regardless of sex, who engages in, desires to engage in, or intends to engage in homosexual acts.” In short, prior to Don’t Ask Don’t Tell, the military had a blatantly discriminatory policy against gays and lesbians. Say what you will about DADT, but at least it tried to acknowledge a distinction between homosexual conduct and homosexual orientation, which previous DOD policy did not recognize (from the revised DOD directive after DADT, “A person’s sexual orientation is considered a personal and private matter, and is not a bar to service entry”).

In the 1992 presidential election campaign, Clinton ran on a promise to reform the policy and allow open service. This pledge, after Clinton took office, met a torrent of opposition from Congressional leaders (Republican and Democratic) and most importantly, the military at all ranks. For example, here’s an excerpt from the 1993 testimony of Michael Oulette — a retired Army Sergeant Major who was head of legislative affairs for the Non Comissioned Officers Association of America, “a federally chartered organization representing 160,000 enlisted members of the Armed Forces…80 pervent serving on active duty” – in front of the Armed Services Committee which supported the older, more discriminatory policy and opposed any change:

The Association has expressed its resolve to oppose any compromise in or change to the DoD policy…[which stated]…that homosexuals were denied enlistment or retention in the U.S. Armed Forces.

Or here’s Norman Schwarzkopf, testifying in front of Congress, “Homosexuality is incompatible [with] military service because the presence of homosexuality seriously impairs of the military mission” and “homosexuals are unsuited for military service.”

Of course, most famously, Colin Powell, then chair of the Joint Chiefs, opposed Clinton’s proposal to allow open service which lead to the DADT compromise.

Now, I’m sorry for having to go over well-trodden, widely known history about the origins of DADT and the historical attitudes towards homosexuality in the U.S. military, and I probably wasted more time than strictly necessary combing through Congressional testimony from 1993, but considering that, in all likelihood, open service will be allowed within a year and DADT and the fight over Kagan’s nomination will be a distant memory, it’s worth getting this stuff right.