Category Archive for: Politics [Return to Main]

Friday, September 22, 2017

Paul Krugman: Cruelty, Incompetence and Lies

"the evasions and lies we’re seeing on this bill have been standard G.O.P. operating procedure for years":

Cruelty, Incompetence and Lies, by Paul Krugman: Graham-Cassidy, the health bill the Senate may vote on next week, is stunningly cruel. It’s also incompetently drafted: The bill’s sponsors clearly had no idea what they were doing... Furthermore, their efforts to sell the bill involve obvious, blatant lies.
Nonetheless, the bill could pass. And that says a lot about today’s Republican Party, none of it good. ...
Did Graham-Cassidy’s sponsors know what they were doing when putting this bill together? Almost surely not, or they wouldn’t have produced something that everyone, and I mean everyone, who knows anything about health care warns would cause chaos.
It’s not just progressives: The American Medical Association, the insurance industry and Blue Cross/Blue Shield have all warned that markets would be destabilized and millions would lose coverage. ...
Lindsey Graham, Bill Cassidy, and the bill’s other sponsors have responded to these critiques the old-fashioned way — with lies.
Both Cassidy and Graham insist that their bill would continue to protect Americans with pre-existing conditions — a claim that will come as news to the A.M.A., Blue Cross and everyone else who has read the bill...
Cassidy has also circulated a spreadsheet that purports to show most states actually getting increased funding under his bill. ... Independent analyses find that most states would, in fact, experience serious cuts... — and everyone would face huge cuts after 2027.
So we’re looking at an incompetently drafted bill that would hurt millions of people, whose sponsors are trying to sell it with transparently false claims. How is it that this bill might nonetheless pass the Senate?
One answer is that Republicans are desperate to destroy President Barack Obama’s legacy ... no matter how many American lives they ruin...
Another answer is that most Republican legislators neither know nor care about policy substance. ... Vox asked a number of G.O.P. senators to explain what Graham-Cassidy does; the answers ranged from incoherence to belligerence to belligerent incoherence.
I’d add that the evasions and lies we’re seeing on this bill have been standard G.O.P. operating procedure for years. ... Graham-Cassidy isn’t an aberration; it’s more like the distilled essence of everything wrong with modern Republicans.
Will this awful bill become law? I have no idea. But even if the handful of Republican senators who retain some conscience block it — we’re looking at you, John McCain — the underlying sickness of the G.O.P. will remain.
It’s sort of a pre-existing condition, and it’s poisoning America.

Monday, September 18, 2017

Paul Krugman: Complacency Could Kill Health Care

"there is a real chance that Graham-Cassidy ... will ... become law, because not enough people are taking it seriously":

Complacency Could Kill Health Care, by Paul Krugman, NY Times: ...last year far too many people were complacent; they assumed that Trump couldn’t possibly become president, so they felt free to engage in trivial pursuits. Then they woke up to find that the inconceivable had happened.
Is something similar about to go down with health care?
Republican attempts to destroy Obamacare have repeatedly failed, and for very good reason. Their attacks on the Affordable Care Act were always based on lies, and they have never come up with a decent alternative. ...
The sponsors of the Graham-Cassidy bill now working its way toward a Senate vote claim to be offering a moderate approach that preserves the good things about Obamacare. In other words, they are maintaining the G.O.P. norm of lying both about the content of Obamacare and about what would replace it.
In reality, Graham-Cassidy is the opposite of moderate. It contains, in exaggerated and almost caricature form, all the elements that made previous Republican proposals so cruel and destructive. ... It would eliminate the individual mandate, undermine if not effectively eliminate protection for people with pre-existing conditions, and slash funding for subsidies and Medicaid. There are a few additional twists, but they’re all bad...
Yet there is a real chance that Graham-Cassidy ... will nonetheless become law, because not enough people are taking it seriously. ...
The main reason Republican leaders couldn’t do that on previous health bills was public outrage and activism. Letters and phone calls, demonstrators and crowds at town halls, made it clear that many Americans were aware of the stakes, and that politicians who voted to take health care away from millions would be held accountable.
Now, however, the news cycle has moved on, taking public attention with it. Many progressives have already begun taking Obamacare’s achievements for granted, and are moving on from protest against right-wing schemes to dreams of single-payer. Unfortunately, that’s exactly the kind of environment in which swing senators, no longer in the spotlight, might be bribed or bullied into voting for a truly terrible bill.
The good news is that for technical reasons of parliamentary procedure, Graham-Cassidy has to pass by the end of this month, or not at all. The bad news is that such passage is a real possibility.
So if you care about preserving the huge gains the A.C.A. has brought, make your voice heard. Otherwise we may wake up to another terrible morning after.

Friday, September 15, 2017

Paul Krugman: Politicians, Promises, and Getting Real

Paul Krugman:

Politicians, Promises, and Getting Real, by Paul Krugman, NY Times: On Wednesday Donald Trump demanded that Congress move quickly to enact his tax reform plan. But so far he has not, in fact, offered any such plan...
Meanwhile, 17 Senate Democrats ... have signed on to Bernie Sanders’s call for expanding Medicare to cover the whole population. So far, however, Sanders hasn’t produced either an estimate of how much that would cost or a specific proposal about how to pay for it.
I don’t mean to suggest that these cases are comparable: The distinctive Trumpian mix of ignorance and fraudulence has no counterpart among Democrats. Still, both stories raise the question of how much ... policy clarity matters for politicians’ ability to win elections and ... govern.
About elections: The fact that Trump is in the White House suggests that politicians can get away with telling voters just about anything that sounds good. ...
On the other hand, the ignominious failure of Trumpcare shows that reality sometimes does matter. ... Once the public realized that tens of millions would lose coverage..., there was a huge backlash...
The story of tax reform ... is starting to look a bit similar. ...
In fact, Trump himself seems to be experiencing cognitive dissonance. “The rich will not be gaining at all with this plan,” he declared Wednesday. ... Is he oblivious, lying, or both? ...
The contrast between what he’s claiming and anything Republicans in Congress will be willing to support is so great as to practically invite ridicule and another popular backlash. ...
But is the push for single-payer health care taking Democrats down a similar path?
Unlike just about everything Trump and company are proposing, Medicare for all is a substantively good idea. Yet actually making it happen would probably mean ... a serious political backlash. For one..., it would require a substantial increase in taxes. For another, it would mean telling scores of millions of Americans who get health coverage though their employers, and are generally satisfied..., that they need to give it up and accept something different. ...
Democrats could eventually find themselves facing a Trumpcare-type debacle, unable either to implement their unrealistic vision or to let it go.
The point is that while unrealistic promises may not hurt you in elections, they can become a big problem when you try to govern. Having a vision for the future is good, but being real about the difficulties is also good. Democrats, take heed.

Monday, September 11, 2017

Paul Krugman: Conspiracies, Corruption and Climate

"Why are U.S. conservatives so willing to disbelieve science and buy into tinfoil-hat conspiracy theories":

Conspiracies, Corruption and Climate, by Paul Krugman, NY Times: After the devastation wreaked by Harvey on Houston — devastation that was right in line with meteorologists’ predictions — you might have expected everyone to take heed when the same experts warned about the danger posed by Hurricane Irma. But you would have been wrong.
On Tuesday, Rush Limbaugh accused weather scientists of inventing Irma’s threat for political and financial reasons: “There is a desire to advance this climate change agenda, and hurricanes are one of the fastest and best ways to do it,” he declared, adding that “fear and panic” help sell batteries, bottled water, and TV advertising.
He evacuated his Palm Beach mansion soon afterward.
In a way, we should be grateful to Limbaugh for at least raising the subject of climate change and its relationship to hurricanes..., it’s a topic the Trump administration is trying desperately to avoid. ...
So what should we learn from Limbaugh’s outburst? ... The important point is that he’s not an outlier..., denying science while attacking scientists as politically motivated and venal is standard operating procedure on the American right. ...
And thanks to Trump’s electoral victory, know-nothing, anti-science conservatives are now running the U.S. government. ... Almost every senior figure in the Trump administration dealing with the environment or energy is both an establishment Republican and a denier of climate change and of scientific evidence in general. ...
All of these scientists, they insist, motivated by peer pressure and financial rewards, are falsifying data and suppressing contrary views.
This is crazy talk. But it’s utterly mainstream on the modern right, among pundits ... and politicians alike.
Why are U.S. conservatives so willing to disbelieve science and buy into tinfoil-hat conspiracy theories about scientists? Part of the answer is that they’re engaged in projection: That’s the way things work in their world. ... Today’s right-wing intellectual universe, such as it is, is dominated by hired guns who are essentially propagandists rather than researchers.
And right-wing politicians harass and persecute actual researchers whose conclusions they don’t like — an effort that has been vastly empowered now that Trump is in power. ...
The bottom line is that we are now ruled by people who are completely alienated not just from the scientific community, but from the scientific idea — the notion that objective assessment of evidence is the way to understand the world. And this willful ignorance is deeply frightening. Indeed, it may end up destroying civilization.

Saturday, September 09, 2017

Paul Krugman: Dreamers, Liars and Bad Economics

"Trump and company tell a lot of lies about economics":

Dreamers, Liars and Bad Economics, by Paul Krugman, NY Times: Does it matter that Jeff Sessions, the attorney general, tried to justify Donald Trump’s immigration cruelty with junk economics?
It’s definitely not the main issue. Trump’s decision to rescind the Deferred Action for Childhood Arrivals policy is, above all else, immoral. The 800,000 beneficiaries of DACA — the so-called Dreamers — have done nothing wrong; they came to the United States illegally, but not of their own volition, because they were children at the time.
They are, according to all available data, an exemplary segment of our population: hard-working young people, many seeking to improve themselves through higher education. They’re committed to the values of their home — because America is their home.
To yank the rug out from under the Dreamers ... is a cruel betrayal. ...
Still, Sessions chose to put economics front and center in his statement, declaring that DACA, which allows the Dreamers to work legally, has “denied jobs to hundreds of thousands of Americans by allowing those same jobs to go to illegal aliens.” That’s just false...
Trump and company tell a lot of lies about economics (and everything else). ...
The truth is that letting the Dreamers work legally helps the U.S. economy; pushing them out or into the shadows is bad for everyone except racists.
To understand why, you need to realize that America, like other advanced economies, is facing a double-barreled demographic challenge thanks to declining fertility.
On one side, an aging population means fewer workers paying taxes to support Social Security and Medicare. Demography is the main reason long-run forecasts suggest problems for Social Security, and an important reason for concerns about Medicare. Driving out young workers who will pay into the system for many decades is a way to make these problems worse.
On the other side, declining growth in the working-age population reduces the returns to private investment, increasing the risk of prolonged slumps like the one that followed the 2008 financial crisis.
It’s not an accident that Japan, which has low fertility and is deeply hostile to immigration, began experiencing persistent deflation and stagnation a decade before the rest of the world. Destroying DACA makes America more like Japan. Why would we want to do that? ...
In short, letting Dreamers work is all economic upside for the rest of our nation, with no downside unless you have something against people with brown skin and Hispanic surnames. Which is, of course, what this is all really about.

Thursday, August 31, 2017

Monopoly Rents and Corporate Taxation

Paul Krugman:

Monopoly Rents and Corporate Taxation (Wonkish): At one level it’s hard to take the Trump administration’s tax “reform” push seriously. A guy gets elected as a populist and his first two big proposals are (a) taking away health insurance from millions (b) cutting corporate taxes. Wow.
Furthermore, Trump is invincibly ignorant on taxes (and everything else) — he keeps declaring that America is the highest taxed nation in the world, which is nearly the opposite of the truth among advanced countries. And his allies in Congress aren’t ignorant, but they’re liars: Paul Ryan is the master of mystery meat, of promising to raise and save trillions in unspecified ways.
But there is an actual interesting question here, even if we shouldn’t give any credence to Republican answers. Who does, in fact, pay the corporate profit tax? Does it fall on corporations, and hence eventually on their shareholders? Or is the ultimate incidence mainly on wages, as the administration claims?

Skipping forward to the punchline:

...much corporate taxation probably doesn’t fall on returns to physical capital, but rather on monopoly rents. ... As long as the local source of profit is some kind of monopoly rent, corporate tax incidence is going to fall on shareholders, not workers. ...
And there’s a lot of reason to believe that market power is an increasingly big deal. ...
This changes the narrative, doesn’t it? Instead of focusing on rising capital mobility as a reason profits taxes might fall on workers, maybe we should focus on rising market power as a reason why profits taxes fall on capitalists.
The point for now is that when someone tells you that changes in the world have made old-style corporate taxes obsolete, be skeptical. Some changes in the world may have made profit taxation a better idea than ever.

Wednesday, August 30, 2017

A Better Way to Elect Presidents (Video) - Eric Maskin

The systems that most countries use to elect presidents are deeply flawed. In particular, candidates A and B may each be more popular than C (in the sense that either would beat C in a head-to-head contest), but nevertheless each may lose to C if they both run. The systems therefore fail to reflect voters’ preferences adequately. In this lecture, I will illustrate this point with examples from U.S. and French political history. I will also propose an election system that is far superior to the current ones.

Monday, August 28, 2017

Paul Krugman: Fascism, American Style

"Let’s call things by their proper names":

Fascism, American Style, by Paul Krugman, NY Times: As sheriff of Maricopa County, Ariz., Joe Arpaio engaged in blatant racial discrimination. His officers systematically targeted Latinos, often arresting them on spurious charges and at least sometimes beating them up... Read the report from the Justice Department’s Civil Rights Division, and prepare to be horrified.
Once Latinos were arrested, bad things happened to them. Many were sent to Tent City, which Arpaio himself proudly called a “concentration camp,” where they lived under brutal conditions, with temperatures inside the tents sometimes rising to 145 degrees.
And when he received court orders to stop these practices, he simply ignored them, which led to his eventual conviction — after decades in office — for contempt of court. But he had friends in high places, indeed in the highest of places. We now know that Donald Trump tried to get the Justice Department to drop the case against Arpaio, a clear case of attempted obstruction of justice. And when that ploy failed, Trump ... pardoned him. ...
Let’s call things by their proper names here. Arpaio is, of course, a white supremacist. But he’s more than that. There’s a word for political regimes that round up members of minority groups and send them to concentration camps, while rejecting the rule of law: What Arpaio brought to Maricopa, and what the president of the United States has just endorsed, was fascism, American style. ...
There have been endless reports about the low-education white voters who went overwhelmingly for Trump... But he wouldn’t have made it over the top without millions of votes from well-educated Republicans who ... had no excuse for not realizing what kind of man he was. ...
This bodes ill if, as seems all too likely, the Arpaio pardon is only the beginning: We may well be in the early stages of a constitutional crisis. Does anyone consider it unthinkable that Trump will fire Robert Mueller, and try to shut down investigations into his personal and political links to Russia? Does anyone have confidence that Republicans in Congress will do anything more than express mild disagreement ... if he does?
As I said, there’s a word for people who round up members of ethnic minorities and send them to concentration camps, or praise such actions. There’s also a word for people who, out of cowardice or self-interest, go along with such abuses: collaborators. How many such collaborators will there be? I’m afraid we’ll soon find out.

Friday, August 25, 2017

Paul Krugman: Trump and Pruitt, Making America Polluted Again

"Don’t say that the administration’s agenda is stalled":

Trump and Pruitt, Making America Polluted Again, by Paul Krugman, NY Times: Efforts to kill Obamacare have failed, at least for now. Tax “reform” — which really means big tax cuts for the rich — faces doubtful prospects. ...
So many observers are asking whether Trump can restart his stalled agenda. But that turns out to be a bad question...
First, Trump doesn’t really have an agenda beyond “winning.” He has instincts and prejudices, but no interest in the details, or even the broad outlines, of policy...
Which brings me to my second point: While the legislative agenda does indeed appear stalled, a lot of what those interest groups want doesn’t require legislation, and is anything but stalled. This is especially true for environmental policy, where decisions about how to interpret and enforce laws ... can have a huge impact.
So Trump’s true legacy may well be defined not by the laws he does or more likely doesn’t pass, but by his decision to put Scott Pruitt in charge of the Environmental Protection Agency.
As Oklahoma’s attorney general, Pruitt effectively acted as a servant, not of the public, but of polluting industries. That’s not an accusation; it’s confirmed by his own email trail. ...
Pruitt can do a lot of harm without changing the law. He can, for example, reverse the ban on a pesticide that the E.P.A.’s own scientists say may damage children’s nervous systems. Or he can move to scrap a rule that would limit heavy-metal contamination from power-plant wastewater.
And he can cripple enforcement of the rules he doesn’t undo simply by working with Trump to starve his own agency of personnel and funds. The Trump budget released in May ... was an indication of priorities — and it called for cutting funding for the E.P.A. by 31 percent, more than any other agency.
Individually, no one of these actions is likely to be treated as front-page news... Cumulatively, however, they will kill or cripple large numbers of Americans — for that is what pollution does, even if the damage is gradual and sometimes invisible.
By the way, if you’re wondering whether an anti-environmental agenda will at least be good for job creation, the answer is no... This agenda will, however, be worth billions to certain campaign donors.
So don’t say that the administration’s agenda is stalled. Some parts are, but other parts are moving right along. When it comes to environmental policy, Trump will definitely change America — and his legacy will literally be toxic.

Monday, August 21, 2017

Paul Krugman: What Will Trump Do to American Workers?

"So is the Trump agenda dead? Not necessarily":

What Will Trump Do to American Workers?, by Paul Krugman, NY Times: ...Donald Trump’s promise to be a populist fighting for ordinary workers was worth about as much as any other Trump promise — that is, nothing. His agenda, such as it is, amounts to reverse Robin Hood with extra racism — the conventional Republican strategy of taking from struggling families to give to the rich, while distracting lower-income whites by attacking Those People, with the only difference being just how blatantly he plays the race card.
At first sight, however, the Trump version of this strategy doesn’t seem to be going very well. ...
So is the Trump agenda dead? Not necessarily, because trickle-down has never been the whole story of the Republican assault on workers. Or to put it another way: Don’t just watch Congress, keep your eyes on what federal agencies are doing.
When you step back and take the long view on trickle-down policies, what you realize is that Trump’s legislative failure is more the rule than the exception. The election of Ronald Reagan was supposed to have set America on a path toward lower taxes and smaller government — and it did, for a while. But those changes have largely been reversed. ...
But here’s the thing: While the rich still pay taxes and the safety net has in some ways gotten stronger, the decades since Reagan have nonetheless been marked by vastly increased inequality, with stagnating wages for most, but soaring incomes for a tiny elite. How did that happen?
Yes, globalization probably played some role, as did technology. But other wealthy countries, just as exposed to the winds of global change, haven’t seen anything like America’s headlong rush into a new Gilded Age. To understand what happened to us..., you need to look at policy — and especially the kind of policy that often flies under the media’s radar. ...
Which brings us back to Trump and the effect he’ll have on America’s working class. Right now it looks as if he may have much less impact on taxing and spending than most people expected. But other policies, often made administratively by federal agencies rather than via legislation, can matter a lot. ...
The point is that progressives shouldn’t celebrate too much over Trump’s legislative failures. As long as he’s in office, he retains a lot of power to betray the working people who supported him. And in case you haven’t noticed, betraying those who trust him is a Trump specialty.

Friday, August 18, 2017

Paul Krugman: Trump Makes Caligula Look Pretty Good

"The Worst President Ever™":

Trump Makes Caligula Look Pretty Good, by Paul Krugman, NY Times: Even before the media obsession with Hillary Clinton’s email server put The Worst President Ever™ in the White House, historians were comparing Donald Trump to Caligula, the cruel, depraved Roman emperor who delighted in humiliating others, especially members of the empire’s elite. But seven months into the Trump administration, we can see that this comparison was unfair.
For one thing, Caligula did not, as far as we know, foment ethnic violence within the empire. For another ... Rome’s government continued to function reasonably well despite his antics...
Finally, when his behavior became truly intolerable, Rome’s elite did what the party now controlling Congress seems unable even to contemplate: It found a way to get rid of him.
Anyone with eyes — eyes not glued to Fox News, anyway — has long realized that Trump is utterly incapable, morally and intellectually, of filling the office he holds. But in the past few days things seem to have reached a critical mass. ...
Everyone in Washington now knows that we have a president who never meant it when he swore to defend the Constitution. He violates that oath just about every day and is never going to get any better.
The good news is that the founding fathers contemplated that possibility and offered a constitutional remedy: Unlike the senators of ancient Rome, who had to conspire with the Praetorian Guard to get Caligula assassinated, the U.S. Congress has the ability to remove a rogue president.
But ... all we get from the vast majority of elected Republicans are off-the-record expressions of “dismay” or denunciations of bigotry that somehow fail to name the bigot in chief. ...
The fact is that white supremacists have long been a key if unacknowledged part of the G.O.P. coalition, and Republicans need those votes to win general elections. Given the profiles in cowardice they’ve presented so far, it’s hard to imagine anything — up to and including evidence of collusion with a foreign power — that would make them risk losing those voters’ support.
So the odds are that we’re stuck with a malevolent, incompetent president... If so, we have to hope that our country somehow stumbles through the next year and a half without catastrophe, and that the midterm elections transform the political calculus and make the Constitution great again.
If that doesn’t happen, all one can say is God save America. Because all indications are that the Republicans won’t.

Monday, August 14, 2017

Paul Krugman: When the President Is Un-American

"we don’t need to wonder whether an anti-American cabal ... has seized power in Washington. It has:":

When the President Is Un-American, by Payl Krugman, NY Times: ...what makes America America is that it is built around an idea: the idea that all men are created equal, and are entitled to basic human rights. Take away that idea and we’re just a giant version of a two-bit autocracy. ...
Real Americans understand that our nation is built around values, not the “blood and soil” of the marchers’ chants; what makes you an American is your attempt to live up to those values, not the place or race your ancestors came from. ...
But the man who began his political ascent by falsely questioning Barack Obama’s place of birth — a blood-and-soil argument if ever there was one — clearly cares nothing about the openness and inclusiveness that have always been essential parts of who we are...
Real Americans understand that our nation was born in a rebellion against tyranny. They feel an instinctive aversion to tyrants..., and an underlying sympathy for democratic regimes...
But the present occupant of the White House has made no secret of preferring the company, not of democratic leaders, but of authoritarian rulers...
Real Americans expect public officials to be humbled by the responsibility that comes with the job. They’re not supposed to be boastful blowhards ... like Trump...
Real Americans understand that being a powerful public figure means facing criticism... Foreign autocrats may rage against unflattering news reports, threaten to inflict financial harm on publications they dislike, talk about imprisoning journalists; American leaders aren’t supposed to sound like that.
Finally, real Americans who manage to achieve high office realize that they are ... meant to use their position for the public good. ... Now we have a leader who is transparently exploiting his office for personal enrichment, in ways that all too obviously amount in practice to influence-buying by domestic malefactors and foreign governments alike.
In short, these days we have a president who is really, truly, deeply un-American, someone who doesn’t share the values and ideals that made this country special...., it’s remarkable that Trump won’t even pretend to be outraged at Putin’s meddling with our election. ...
Whatever role foreign influence may have played and may still be playing, however, we don’t need to wonder whether an anti-American cabal, hostile to everything we stand for, determined to undermine everything that truly makes this country great, has seized power in Washington. It has: it’s called the Trump administration.

Friday, August 11, 2017

Paul Krugman: The Axis of Climate Evil

"Where does climate denial come from?":

The Axis of Climate Evil, by Paul Krugman, NY Times: ...At this point the evidence for human-caused global warming just keeps getting more overwhelming, and the plausible scenarios for the future — extreme weather events, rising sea levels, drought, and more — just keep getting scarier.
In a rational world urgent action to limit climate change would be the overwhelming policy priority for governments everywhere.
But the U.S. government is, of course, now controlled by a party within which climate denial — rejecting not just scientific evidence but also obvious lived experience, and fiercely opposing any effort to slow the trend — has become a defining marker of tribal identity. ...
So where does climate denial come from? ... The answer, I’d argue, is that there are actually three groups involved — a sort of axis of climate evil.
First, and most obvious, there’s the fossil fuel industry — think the Koch brothers — which has an obvious financial stake in continuing to sell dirty energy. And the industry ... has systematically showered money on think tanks and scientists willing to express skepticism about climate change. ...
Still, the mercenary interests of fossil fuel companies aren’t the whole story here. There’s also ideology.
An influential part of the U.S. political spectrum — think the Wall Street Journal editorial page — is opposed to any and all forms of government economic regulation; it’s committed to Reagan’s doctrine that government is always the problem, never the solution. ...
Some conservatives ... support market-friendly intervention to limit greenhouse gas emissions. But all too many prefer simply to deny the existence of the issue — if facts conflict with their ideology, they deny the facts.
Finally, there are a few public intellectuals — less important than the plutocrats and ideologues, but if you ask me even more shameful — who adopt a pose of climate skepticism out of sheer ego. In effect, they say: “Look at me! I’m smart! I’m contrarian! I’ll show you how clever I am by denying the scientific consensus!” And for the sake of this posturing, they’re willing to nudge us further down the road to catastrophe.
Which brings me back to the current political situation. Right now progressives are feeling better than they expected to a few months ago: Donald Trump and his frenemies in Congress are accomplishing a lot less than they hoped, and their opponents feared. But that doesn’t change the reality that the axis of climate evil is now firmly in control of U.S. policy, and the world may never recover.

Friday, August 04, 2017

Paul Krugman: Obamacare Rage in Retrospect

"What was Obamacare rage about?":

Obamacare Rage in Retrospect, by Paul Krugman, NY Times: I guess it ain’t over until the portly golfer sings, but it does look as if Obamacare will survive. ...
It’s true that the tweeter in chief retains considerable ability to sabotage care, but Republicans are basically begging him to stop, believing — correctly — that the public will blame them for any future deterioration in coverage.
Why did Obamacare survive? The shocking answer: It’s still here because it does so much good. ...
Which raises a big question: Why did the prospect of health reform produce so much popular rage in 2009 and 2010?
I’m not talking about the rage of G.O.P. apparatchiks, who hated and feared the A.C.A., not because they thought it would fail, but because they were afraid it would work. (It has.) Nor am I talking about the rage of some wealthy people furious that their taxes were going up to pay for lesser mortals’ care.
No, I’m talking about the people who screamed at their congressional representatives in town halls... What was Obamacare rage about?
Much of it was orchestrated by pressure groups like Freedom Works, and it’s a good guess that some of the “ordinary citizens” who appeared at town halls were actually right-wing activists. Still, there was plenty of genuine popular rage, stoked by misinformation and outright lies from the usual suspects: Fox News, talk radio and so on. ...
The question then becomes why so many people believed these lies. The answer, I believe, comes down to a combination of identity politics and affinity fraud.
Whenever I see someone castigating liberals for engaging in identity politics, I wonder what such people imagine the right has been doing all these years. For generations, conservatives have conditioned many Americans to believe that safety-net programs are all about taking things away from white people and giving stuff to minorities.
And those who stoked Obamacare rage were believed because they seemed to some Americans like their kind of people — that is, white people defending them against you-know-who.
So what’s the moral of this story? ...
It’s certainly not encouraging to realize how easily many Americans were duped by right-wing lies, pushed into screaming rage against a reform that would actually improve their lives.
On the other hand, the truth did eventually prevail, and Republicans’ inability to handle that truth is turning into a real political liability. And in the meantime, Obamacare has made America a better place.

Monday, July 31, 2017

Paul Krugman: Who Ate Republicans’ Brains?

"Where did this zombie horde come from?":

Who Ate Republicans’ Brains?, by Paul Krugman, NY Times: When the tweeter-in-chief castigated Senate Republicans as “total quitters” for failing to repeal the Affordable Care Act, he couldn’t have been more wrong. In fact, they showed zombie-like relentlessness in their determination to take health care away from millions of Americans, shambling forward despite devastating analyses by the Congressional Budget Office, denunciations of their plans by every major medical group, and overwhelming public disapproval.
Put it this way: Senator Lindsey Graham was entirely correct when he described the final effort at repeal as “terrible policy and horrible politics,” a “disaster” and a “fraud.” He voted for it anyway — and so did 48 of his colleagues.
So where did this zombie horde come from? Who ate Republicans’ brains? ...
The Republican health care debacle was the culmination of a process of intellectual and moral deterioration that began four decades ago...
A key moment came in the 1970s, when Irving Kristol, the godfather of neoconservatism, embraced supply-side economics — the claim, refuted by all available evidence and experience, that tax cuts pay for themselves by boosting economic growth. Writing years later, he actually boasted about valuing political expediency over intellectual integrity: “I was not certain of its economic merits but quickly saw its political possibilities.” In another essay, he cheerfully conceded to having had a “cavalier attitude toward the budget deficit,” because it was all about creating a Republican majority — so “political effectiveness was the priority, not the accounting deficiencies of government.”
The problem is that once you accept the principle that it’s O.K. to lie if it helps you win elections, it gets ever harder to limit the extent of the lying — or even to remember what it’s like to seek the truth. ...
Given this history, the Republican health care disaster was entirely predictable. You can’t expect good or even coherent policy proposals from a party that has spent decades embracing politically useful lies and denigrating expertise. ...
Now what? Maybe, just maybe, Republicans will work with Democrats to make the health system work better — after all, polls suggest that voters will, rightly, blame them for any future problems. But it wouldn’t be easy for them to face reality even if their president wasn’t a bloviating bully.
And it’s hard to imagine anything good happening on other policy fronts, either. Republicans have spent decades losing their ability to think straight, and they’re not going to get it back anytime soon.

Friday, July 28, 2017

Paul Krugman: The Sanctimony and Sin of G.O.P. ‘Moderates’

"The hypocrisy sweepstakes":

The Sanctimony and Sin of G.O.P. ‘Moderates’, by Paul Krugman, NY Times: ...When we look at the degeneration of American politics, it’s natural to blame the naked partisans — people like Mitch McConnell, with his principle-free will to power, or Ted Cruz, with his ideological rigidity. And Trump has, of course, done more to degrade his office than any previous occupant of the White House.
But none of what is happening right now would be possible without the acquiescence of politicians who pretend to be open-minded, decry partisanship, tut-tut about incivility and act as enablers for the extremists again and again.
I started with McCain because so many journalists still fall for his pose as an independent-minded maverick, ignoring the reality that he has almost always been a reliable partisan yes-man whenever it matters. ...
But he has rivals in the hypocrisy sweepstakes. Consider, for example, Senator Shelley Moore Capito of West Virginia — whose state has benefited enormously from the Affordable Care Act. “I didn’t come here to hurt people,” she declared not long ago — then voted for a bill that would quadruple the number of uninsured in West Virginia.
Or consider Rob Portman of Ohio, who cultivates an image as a moderate, praises Medicaid and talked big about the defects of Republican health plans — but also voted for that bill. Hey, in Ohio the number of uninsured would only triple. Let’s add Dean Heller of Nevada, who has lauded his state’s federally financed Medicaid expansion, but voted along with McCain to let debate proceed on an unknown bill, very much putting that expansion at risk.
Credit where credit is due: two senators, Lisa Murkowski of Alaska and Susan Collins of Maine, have stood up against the effort to betray every promise Republicans have made — and McCain did something right in the end. But every other supposed moderate in the Senate has offered a profile in cowardice.
And let’s be clear: This story didn’t start in the last few weeks, or the past few months. Republicans have been denouncing Obamacare and pledging to repeal and replace it for seven years, only to be caught flat-footed when given the chance to come up with an alternative. ...
So will the Senate pass something awful? If it does, will the House pass it, too, or try to use it as a Trojan horse for something even worse? I don’t know. But whatever happens, every Senate Republican besides Collins and Murkowski should be deeply ashamed.

Monday, July 24, 2017

Paul Krugman: Health Care Is Still in Danger

"The latest round of falsehoods about health care, combined with the defamation of the C.B.O., may be gaining some political traction":

Health Care Is Still in Danger, by Paul Krugman, NY Times: Will Senate Republicans try to destroy health care under cover of a constitutional crisis? That’s a serious question, based in part on what happened in the House...
As you may remember, back in March attempts to repeal and replace the Affordable Care Act seemed dead after the Congressional Budget Office released a devastating assessment..., the House Republican bill would lead to 23 million more uninsured Americans. Faced with intense media scrutiny and an outpouring of public opposition, House leaders pulled their bill, and the debate seemed over.
But then media attention moved on to presidential tweets and other outrages — and with the spotlight off, House leaders bullied and bribed enough holdouts to narrowly pass a bill after all.
Could something similar happen in the Senate? A few days ago the Senate’s equally awful version of repeal and replace ... seemed dead. And media attention has visibly shifted off the subject, focusing on juicier topics like the Russia-Trump story. ...
One particular concern is that the latest round of falsehoods about health care, combined with the defamation of the C.B.O., may be gaining some political traction. ... In particular, the claim is that its prediction of huge losses in coverage is outlandish, and that to the extent that fewer people would be covered, it would be due to their voluntary choices.
In reality, those C.B.O. predictions of coverage losses are totally reasonable, given the ... drastic cuts to Medicaid...
And on those claims that it’s O.K. if people drop coverage, because that would be their own choice... Current law provides enough in subsidies that an individual with an income of $26,500 can afford a plan covering 70 percent of medical expenses, which ... implies an $800 deductible. The Senate bill reduces that standard of coverage to 58 percent, which would raise the implied deductible to $13,000, making the insurance effectively useless. Would deciding not to buy that useless insurance really be a “choice”? ...
In short, the Senate bill is every bit as cruel and grotesque as its critics say. But we need to keep reminding wavering senators and their constituents of that fact, lest they be snowed by a blizzard of lies. ...
And while ordinary citizens can’t yet do much about the looming constitutional crisis, their calls, letters, and protests can still make all the difference on health care. Don’t let the bad guys in the Senate do terrible things because you weren’t paying attention!

Friday, July 21, 2017

Paul Krugman: Health Care in a Time of Sabotage

"It’s basically about spite":

Health Care in a Time of Sabotage, by Paul Krugman, NY Times: Is Trumpcare finally dead? Even now, it’s hard to be sure, especially given Republican moderates’ long track record of caving in to extremists at crucial moments. But it does look as if the frontal assault on the Affordable Care Act has failed.
And let’s be clear: The reason this assault failed wasn’t that Donald Trump did a poor selling job, or that Mitch McConnell mishandled the legislative strategy. Obamacare survived because it has worked — because it brought about a dramatic reduction in the number of Americans without health insurance, and voters ... don’t want to lose those gains.
Unfortunately, some of those gains will probably be lost all the same: The number of uninsured Americans is likely to tick up over the next few years. So it’s important to say clearly, in advance, why this is about to happen. It won’t be because the Affordable Care Act is failing..., when Trump threatens to “let Obamacare fail,” what he’s really threatening is to make it fail.
On Wednesday The Times reported on three ways the Trump administration is, in effect, sabotaging the A.C.A.... First, the administration is weakening enforcement of the requirement that healthy people buy coverage. Second, it’s letting states impose onerous rules like work requirements on people seeking Medicaid. Third, it has backed off on advertising and outreach designed to let people know about options for coverage. ...
And there may be worse to come: Insurance companies, which are required by law to limit out-of-pocket expenses of low-income customers, are already raising premiums sharply because they’re worried about a possible cutoff of the crucial federal “cost-sharing reduction” subsidies that help them meet that requirement.
The truly amazing thing about these sabotage efforts is that they don’t serve any obvious purpose. They won’t save money — in fact, cutting off those subsidies ... would probably end up costing taxpayers more money than keeping them. They’re unlikely to revive Trumpcare’s political prospects.
So this isn’t about policy, or even politics in the normal sense. It’s basically about spite: Trump and his allies may have suffered a humiliating political defeat, but at least they can make millions of other people suffer.
Can anything be done to protect Americans from this temper tantrum? In some cases, I believe, state governments can insulate their citizens from malfeasance at H.H.S. But the most important thing, surely, is to place the blame where it belongs. No, Mr. Trump, Obamacare isn’t failing; you are.

Thursday, July 20, 2017

This Ridiculous Republican Propaganda is Exactly Why We Need the CBO

Catherine Rampell:

This ridiculous Republican propaganda is exactly why we need the CBO: Tuesday I wrote about the GOP’s systematic efforts to discredit and disempower any independent voice — media, the Congressional Budget Office, the Office of Government Ethics — that tries to hold government accountable.
Today we have a great example of the ridiculous propaganda that Republicans expect the public to swallow in the absence of such independent critics and scorekeepers.
The Washington Examiner has gotten its hands on a Trump administration “analysis” (I use that word loosely) of the Consumer Freedom Amendment, a proposal from Sen. Ted Cruz (R-Tex.). ...
Talk to literally any economist, including conservative ones, and you’ll learn that this idea would lead to adverse selection, a huge spike in premiums for sick people..., a proliferation of mini-med junk plans that cover virtually nothing..., and a possible death spiral. A more detailed explanation of this phenomenon is here. ...
Contrary to the predictions of economists everywhere, the HHS propaganda document claims that the Cruz amendment would cause insurance coverage to go up and premiums to fall. Astoundingly, even premiums for people in the Obamacare-compliant plans — which, again, economic theory suggests would get stuck with only the very sickest, most expensive Americans — would allegedly decline relative to current law. ...
This is garbage, and exactly why we need nonpartisan scorekeepers like the CBO. ...

Friday, July 14, 2017

Paul Krugman: The Cruelty and Fraudulence of Mitch McConnell’s Health Bill

"the last act in a long con":

The Cruelty and Fraudulence of Mitch McConnell’s Health Bill, by Paul Krugman, NY Times: A few days ago the tweeter in chief demanded that Congress enact “a beautiful new HealthCare bill” before it goes into recess. But now we’ve seen Mitch McConnell’s latest version of health “reform,” and “beautiful” is hardly the word for it. In fact, it’s surpassingly ugly, intellectually and morally. Previous iterations of Trumpcare were terrible, but this one is, incredibly, even worse. ...
The most important change in the bill ... is the way it would effectively gut protection for people with pre-existing medical conditions. The Affordable Care Act put minimum standards on the kinds of policies insurers were allowed to offer; the new Senate bill gives in to demands by Ted Cruz that insurers be allowed to offer skimpy plans that cover very little, with very high deductibles that would make them useless to most people.
The effects of this change would be disastrous. Don’t take my word for it: It’s what the insurers themselves say. ...
Or to put it another way, this bill would send insurance markets into a classic death spiral. Republicans have been predicting such a spiral for years, but keep being wrong: ...Obamacare ... is stabilizing, and doing pretty well in states that support it. But this bill would effectively sabotage all that progress.
And let’s be clear: Many of the victims of this sabotage would be members of the white working class, people who voted for Donald Trump in the belief that he really meant it when he promised that there would be no cuts to Medicaid and that everyone would get better, cheaper insurance. So why ... is there even a chance that it might become law?
The main answer, I’d argue, is that ... conservative ideology always denied the proposition that people are entitled to health care; the Republican elite considered and still considers people on Medicaid, in particular, “takers” who are effectively stealing from the deserving rich.
And the conservative view has always been that Americans have health insurance that is too good, that they should pay more in deductibles and co-pays, giving them “skin in the game,” and thus an incentive to control costs.
So what we’re seeing here is supposed to be the last act in a long con, the moment when the fraudsters cash in, and their victims discover how completely they’ve been fooled. The only question is whether they’ll really get away with it. We’ll find out very soon.

Wednesday, July 12, 2017

How Market Power Leads to Corporate Political Influence

 From ProMarket:

How Market Power Leads to Corporate Political Influence, by Asher Schechter: Neoclassical economic theory assumes that firms have no power to influence the rules of the game. A new paper by Luigi Zingales argues: This is true only in competitive product markets. When firms have market power, they will seek and obtain political influence and vice versa.
In 2016, the advocacy group Global Justice Now published a report showing that 69 of the world’s largest 100 economic entities are now corporations, not governments. With annual revenues of $485.9 billion, Walmart topped all but nine countries. As the world’s corporations continue to grow bigger and more profitable, so does the power and influence they wield: multinational corporations employ vast armies of lobbyists, lawyers, and PR people across borders and continents, and they have more than enough resources to capture regulators and elected representatives the world over.
Yet, the prevailing economic definition views firms as merely “a nexus of contracts” with “no power of fiat, no authority, no disciplinary action any different in the slightest degree from ordinary market contracting between two people.” How is it possible to reconcile these two views? A new paper by Luigi Zingales (Faculty Director of the Stigler Center and one of the editors of this blog) tries to bridge this gap.
The Medici vicious circle
The neoclassical model of the firm, notes Zingales, is a reasonable description of firms operating in highly competitive markets, where firms have little incentives and fewer resources to distort the rules of the game. Little incentives because in a neoclassical framework firms are relatively small, and thus the costs of these activities tend to exceed their share of the benefits. Fewer resources, because a competitive market does not provide firms with abnormal profits to spend in lobbying activities. 
The opposite is true in concentrated markets, where firms enjoy sufficiently high profits to spend in lobbying activity. Some market power is particularly important to gain political influence when cash bribes are relatively rare, writes Zingales. In such an environment, firms gain political power through promises of future benefits. Only if firms have significant market power do they have rents to allocate. At the same time, firms’ promises of future rents are credible only to the extent that firms are expected to be around in the future, a prospect greatly enhanced by the existence of some barrier to entry in the markets in which they operate. Thus, firms can gain political power only when they have significant market power. ...

Friday, July 07, 2017

Paul Krugman: Attack of the Republican Decepticons

Conservatives "keep scaling new heights of dishonesty in their attempt to sell their reverse-Robin Hood agenda":

Attack of the Republican Decepticons, by Paul Krugman, NY Times: Does anyone remember the “reformicons”? A couple of years back there was much talk about a new generation of Republicans who would ... move their party off its cruel and mindless agenda of tax cuts for the rich and pain for the poor, bringing back the intellectual seriousness that supposedly used to characterize the conservative movement.
But the rise of the reformicons never happened. What we got instead was the (further) rise of the decepticons..., conservatives who keep scaling new heights of dishonesty in their attempt to sell their reverse-Robin Hood agenda.
Consider ... Republican leaders’ strategy on health care..., here are a few low points. ...
Despite encountering some significant problems, the Affordable Care Act has ... extended health insurance to millions of Americans... And these numbers translate into dramatic positive impacts on real lives. ...
How do Republicans argue against this success? You can get a good overview by looking at the Twitter feed of Tom Price,... secretary of health and human services...
First, he points to the fact that fewer people than expected have signed up on the exchanges ... and portrays this as a sign of dire failure. But a lot of this shortfall is the result of good news: Fewer employers than predicted chose to drop coverage and shift their workers onto exchange plans. ...
Second, he points to the 28 million U.S. residents who remain uninsured... But nobody expected Obamacare to cover everyone... And you have to wonder how Price can look himself in the mirror ... when his own party’s plans would vastly increase the number of uninsured.
Which brings us to Republicans’ efforts to obscure the nature of their own plans. ...
On one side, they claim that a cut is not a cut, because dollar spending on Medicaid would still rise over time. ...
On the other side ... senior Republicans ... dismiss declines in the number of people with coverage as no big deal, because they would represent voluntary choices not to buy insurance.
How is this supposed to apply to the 15 million people the C.B.O. predicts would lose Medicaid? ...
Political spin used to have its limits: Politicians who wanted to be taken seriously wouldn’t go around claiming that up is down and black is white.
Yet today’s Republicans hardly ever do anything else. It’s not just Donald Trump: The whole G.O.P. has become a post-truth party. And I see no sign that it will ever improve.

Friday, June 30, 2017

Paul Krugman: Understanding Republican Cruelty

What's the driving force behind the Republican's "ugly health plan":

Understanding Republican Cruelty, by Paul Krugman, NY Times: The basics of Republican health legislation ... are easy to describe: Take health insurance away from tens of millions, make it much worse and far more expensive for millions more, and use the money thus saved to cut taxes on the wealthy. ...
The puzzle ... is why the party is pushing this harsh, morally indefensible agenda.
Think about it. Losing health coverage is a nightmare, especially if you’re older, have health problems and/or lack the financial resources to cope if illness strikes. ...
Meanwhile, taxes that fall mainly on a tiny, wealthy minority would be reduced or eliminated. These cuts would be big in dollar terms, but because the rich are already so rich, the savings would make very little difference to their lives. ...
Which brings me back to my question: Why would anyone want to do this?
I won’t pretend to have a full answer, but I think there are two big drivers — actually, two big lies — behind Republican cruelty on health care and beyond.
First..., Republicans spent almost the entire Obama administration railing against the imaginary horrors of the Affordable Care Act — death panels! — repealing Obamacare was bound to be their first priority.
Once the prospect of repeal became real, however, Republicans had to face the fact that Obamacare, far from being the failure they portrayed, has done what it was supposed to do...
So one way to understand this ugly health plan is that Republicans, through their political opportunism and dishonesty, boxed themselves into a position that makes them seem cruel and immoral — because they are.
Yet that’s surely not the whole story, because Obamacare isn’t the only social insurance program that does great good yet faces incessant right-wing attack. Food stamps, unemployment insurance, disability benefits all get the same treatment. Why?
As with Obamacare, this story began with a politically convenient lie — the pretense ... that social safety net programs just reward lazy people who don’t want to work. And we all know which people in particular were supposed to be on the take.
Now, this was never true..., some of the biggest beneficiaries of these safety net programs are members of the Trump-supporting white working class. ...
So what will happen to this monstrous bill? I have no idea. Whether it passes or not, however, remember this moment. For this is what modern Republicans do; this is who they are.

Monday, June 26, 2017

Will Macron’s Marchers take power?

Thomas Piketty:

Will Macron’s Marchers take power?: With over 350 seats, the MPs elected on the « La république en marche » (LREM) ticket will have an overwhelming majority in the Assemblée Nationale (Parliament). Will they use it to be in the forefront of reform and renewal of French politics? Or will they simply play a passive role, rubber stamping and obediently voting the texts that the government sends them?
It happens that they will shortly be faced with their first real-life test with the question of deduction of income tax at source. The government wishes to postpone the implementation until 2019, perhaps forever, for reasons which are totally opportunist and unjustified. This big step backwards is bad news for the alleged intention to reform and modernise the French fiscal and social system proclaimed by the new government (a general intention that is unfortunately rather vague once we enter into the details: see What reforms for France), and leads us to fear the worst for what is to come. Now, contrary to what has been stated, the government cannot take this sort of decision without a vote in Parliament which should therefore take place in the coming days or weeks.
There are two possibilities. Either the LREM MP’s force the government to maintain this crucial reform and its application as from January 2018, as was already voted by the outgoing Parliament in the autumn of 2016 in the context of the 2017 Finance Act. It will then be clear that the new MP’s are ready to play their role fully in future reforms and oppose the executive when necessary. The other option is to follow in the steps of the conservatism of the government, which, unfortunately, seems to be the most likely outcome. This would alert us to the fact that with this new majority and this new authority we are dealing with reformers who are mere paper tigers. ...

Friday, June 23, 2017

Pure Class Warfare, With Extra Contempt

Paul Krugman:

Pure Class Warfare, With Extra Contempt: The Senate version of Trumpcare – the Better Care Reconciliation Act – is out. The substance is terrible: tens of millions of people will experience financial distress if this passes, and tens if not hundreds of thousands will die premature deaths, all for the sake of tax cuts for a handful of wealthy people. What’s even more amazing is that Republicans are making almost no effort to justify this massive upward redistribution of income. They’re doing it because they can, because they believe that the tribalism of their voters is strong enough that they will continue to support politicians who are ruining their lives.
In this sense – and in only this sense – what we’re seeing now is a departure from previous Republican practice.
In the past, laws that would take from the poor and working class while giving to the rich came with excuses. Tax cuts, their sponsors declared, would unleash market dynamism and make everyone more prosperous. Deregulation would increase efficiency and lower prices. It was all voodoo; the promises never came true. But at least there was some pretense of working for the common good.
Now we have none of this. This bill does nothing to reduce health care costs. It does nothing to improve the functioning of health insurance markets – in fact, it will send them into death spirals by reducing subsidies and eliminating the individual mandate. There is nothing at all in the bill that will make health care more affordable for those currently having trouble paying for it. And it will gradually squeeze Medicaid, eventually destroying any possibility of insurance for millions. ...
But Republican leaders believe that their voters are tribal enough, sufficiently walled off from information, that they’ll ignore the attack on their lives and keep voting R – indeed, that as they lose health care, get hit with crushing out-of-pocket bills, see their friends and neighbors face ruin, they’ll blame it on Democrats.
I wish I were sure that this belief was false.

Monday, June 19, 2017

Paul Krugman: Zombies, Vampires and Republicans

"The one obvious payoff to taking health care away from millions: a big tax cut for the wealthy":

Zombies, Vampires and Republicans, by Paul Krugman, NY Times: Zombies have long ruled the Republican Party. ... What are these zombies of which I speak? Among wonks, the term refers to policy ideas that should have been abandoned long ago in the face of evidence and experience, but just keep shambling along.
The right’s zombie-in-chief is the insistence that low taxes on the rich are the key to prosperity. This doctrine should have died...
Despite the consistent wrongness of their predictions, however, tax-cut fanatics just kept gaining influence in the G.O.P. — until the disaster in Kansas...
Will this banish the tax-cut zombie? Maybe — although the economists behind the Kansas debacle, who have of course learned nothing, appear to be the principal movers behind the Trump tax plan, such as it is.
But even as the zombies move offstage, vampire policies — so-called not so much because of their bloodsucking nature, although that too, as because they can’t survive daylight — have taken their place.
Consider what’s happening right now on health care.
Last month House Republicans rammed through one of the worst, cruelest pieces of legislation in history. ...
This bill is, as it should be, wildly unpopular. Nonetheless, Republican Senate leaders are now trying to ram through their own version of the A.H.C.A., one that, all reports suggest, will differ only in minor, cosmetic ways. And they’re trying to do it in total secrecy. ...
Clearly, the goal is to pass legislation that will have devastating effects on tens of millions of Americans without giving those expected to pass it, let alone the general public, any real chance to understand what they’re voting for. ...
This is unprecedented...
Of course..., the one obvious payoff to taking health care away from millions: a big tax cut for the wealthy. As I said, while bloodsucking isn’t the main reason to call this a vampire policy, it’s part of the picture....
You can blame Donald Trump for many things, including the fact that he will surely sign whatever bad bill is put in front of him. But as far as health care is concerned, he’s just an ignorant bystander...
So this isn’t a Trump story; it’s about the cynicism and corruption of the whole congressional G.O.P. Remember, it would take just a few conservatives with conscience — specifically, three Republican senators — to stop this outrage in its tracks. But right now, it looks as if those principled Republicans don’t exist.

Friday, June 16, 2017

Janet Yellen Is Her Own Best Successor

Narayana Kocherlakota:

Janet Yellen Is Her Own Best Successor: President Donald Trump has reportedly begun the process of deciding who will lead the U.S. Federal Reserve after Janet Yellen's term ends early next year. If he wants the best outcome for the economy, he can't do better than Janet Yellen. ...
Yellen's policies have contributed to a surprisingly strong labor market recovery, yet also been sufficiently cautious to keep inflation below target. Some would see this as an all-around success, though the Fed's caution does have a downside: Markets appear to believe that the central bank is unwilling or unable to hit its inflation target with consistency. ... If it persists, this loss of credibility means that the Fed will have less ammunition to fight the next recession.  
So could any of the other potential appointees do better? ...
Warsh, Taylor, and Hubbard all reportedly see Yellen’s Fed as having been too dovish, suggesting that that they would have done less to support the economic recovery. This approach would have led to higher unemployment and lower inflation -- an inferior fulfilment of the Fed's dual mandate that marks them as worse candidates than Yellen.  It's also important to remember that Taylor and Warsh argued publicly against additional monetary stimulus in November 2010, when the unemployment rate was almost 10 percent and the inflation rate had fallen nearly to 1 percent. Their concerns about excessive inflation proved to be completely unjustified. Yellen, by contrast, supported stimulus.
Yellen has a proven track record that's hard to beat. ... The president should reappoint her to the position of Fed chair.

The Silence of the Hacks

Paul Krugman:

The Silence of the Hacks: The actual text of the Senate version of Trumpcare is still a secret, even from almost all the Senators who are expected to vote for it. But that’s actually a secondary issue: never mind the precise details, what’s the organizing idea? What is the bill supposed to do, and how is it supposed to do it?
The answer — which I’ve been suggesting for a while — is that they have no idea, and more broadly, no ideas in general. Now Vox confirms this...
Time was when even the worst legislation came with some kind of justification, when you could count on the hacks at Heritage to explain why eating children will encourage entrepreneurship, or something. ...
But now we have legislation that will change the lives of millions, and they haven’t even summoned the usual suspects to explain what a great idea it is. If hypocrisy is the tribute vice pays to virtue, Republicans have decided that even that’s too much; they’re going to try to pass legislation that takes from the poor and gives to the rich without even trying to offer a justification.
And they’ll try to do it by dead of night, of course.
This has nothing to do with Trump, who is, as I’ve been saying, an ignorant bystander — yes, he’s betraying every promise he made, but what else is new? It’s about Congressional Republicans.
Which Congressional Republicans? All of them. Remember, three senators who cared even a bit about substance, legislative process, and just plain honesty with the public, could stop this. So far, it doesn’t look as if there are those three senators.
This is a level of corruption that’s hard to fathom. Yet it’s the reality of one of our two parties.

Thursday, June 15, 2017

I’ve Covered Obamacare Since Day One. I’ve Never Seen Lying and Obstruction Like This.

Sarah Kliff:

I’ve covered Obamacare since day one. I’ve never seen lying and obstruction like this, Republicans do not want the country to know what is in their health care bill.
This has become more evident each day, as the Senate plots out a secretive path toward Obamacare repeal — and top White House officials (including the president) consistently lie about what the House bill actually does. ...
My biggest concern isn’t the hypocrisy; there is plenty of that in Washington. It’s that the process will lead to devastating results for millions of Americans who won’t know to speak up until the damage is done. So far, the few details that have leaked out paint a picture of a bill sure to cover millions fewer people and raise costs on those with preexisting conditions.
The plan is expected to be far-reaching, potentially bringing lifetime limits back to employer-sponsored coverage, which could mean a death sentence for some chronically ill patients who exhaust their insurance benefits. ...

Monday, June 05, 2017

The More Trump Fails, the Better Off We’ll Be

I have a new column:

The More Trump Fails, the Better Off We’ll Be: The Trump administration has gone to war against independent sources of information that pose a challenge to its policy goals and the narratives it tells to support them. One of the most recent targets is the Congressional Budget Office. ...

Paul Krugman: Making Ignorance Great Again

The truth is out there, but it's buried under a large pile of nonsense, lies, misleading statements, and deception:

Making Ignorance Great Again, by Paul Krugman, NY Times: Donald Trump just took us out of the Paris climate accord for no good reason. I don’t mean that his decision was wrong. I mean, literally, that he didn’t offer any substantive justification... It was just what he felt like doing.
And here’s the thing: What just happened on climate isn’t an unusual case — and Trump isn’t especially unusual for a modern Republican. ... Facts and hard thinking aren’t wanted, and anyone who tries to bring such things into the discussion is the enemy.
Consider ... health care. ... Did the administration and its allies consult with experts, study previous experience with health reform, and try to devise a plan that made sense? Of course not. In fact, House leaders made a point of ramming a bill through before the Congressional Budget Office ... could assess its likely impact.
When the budget office did weigh in, its conclusions were what you might expect:... a lot of people are going to lose coverage. Is 23 million a good estimate...? Yes — it might be 18 million, or it might be 28 million, but surely it would be in that range.
So how did the administration respond? By trying to shoot the messenger. Mick Mulvaney, the White House budget director, attacked the C.B.O...
So, Mr. Mulvaney, where’s your assessment of Trumpcare? You had plenty of resources to do your own study before trying to pass a bill. ...
But Mulvaney and his party don’t study issues, they just decide, and attack the motives of anyone who questions their decisions. ... Truth, as something that exists apart from and in possible opposition to political convenience, is no longer part of their philosophical universe. ...
And as health care and climate go, so goes everything else. Can you think of any major policy area where the G.O.P. hasn’t gone post-truth? ...
But does any of it matter? The president, backed by his party, is talking nonsense, destroying American credibility day by day. But hey, stocks are up, so what’s the problem?
Well, bear in mind that so far Trump hasn’t faced a single crisis not of his own making. As George Orwell noted ... in his essay “In Front of Your Nose,” people can indeed talk nonsense for a very long time, without paying an obvious price. But “sooner or later a false belief bumps up against solid reality, usually on a battlefield.” Now there’s a happy thought.

Friday, June 02, 2017

Paul Krugman: Trump Gratuitously Rejects the Paris Climate Accord

If liberals are for it, they’re against it:

Trump Gratuitously Rejects the Paris Climate Accord, by Paul Krugman, NY Times: As Donald Trump does his best to destroy the world’s hopes of reining in climate change, let’s be clear about one thing: This has nothing to do with serving America’s national interest. The U.S. economy, in particular, would do just fine under the Paris accord. This isn’t about nationalism; mainly, it’s about sheer spite.
About the economics:... Clearly, it would be an economy running on electricity...
What would life in an economy that made such an energy transition be like? Almost indistinguishable from life in the economy we have now. ...
Wouldn’t energy be more expensive in this alternative economy? Probably, but not by much: Technological progress in solar and wind has drastically reduced their cost, and it looks as if the same thing is starting to happen with energy storage.
Meanwhile, there would be compensating benefits. Notably, the adverse health effects of air pollution would be greatly reduced, and it’s quite possible that lower health care costs would all by themselves make up for the costs of energy transition, even ignoring the whole saving-civilization-from-catastrophic-climate-change thing. ...
Why, then, are so many people on the right determined to block climate action, and even trying to sabotage the progress we’ve been making on new energy sources?
Don’t tell me that they’re honestly worried about the inherent uncertainty of climate projections. ...
Don’t tell me that it’s about coal miners. ...
While it isn’t about coal jobs, right-wing anti-environmentalism is in part about protecting the profits of the coal industry, which in 2016 gave 97 percent of its political contributions to Republicans. ...
Pay any attention to modern right-wing discourse — including op-ed articles by top Trump officials — and you find deep hostility to any notion that some problems require collective action beyond shooting people and blowing things up.
Beyond this, much of today’s right seems driven above all by animus toward liberals rather than specific issues. If liberals are for it, they’re against it. If liberals hate it, it’s good. Add to this the anti-intellectualism of the G.O.P. base, for whom scientific consensus on an issue is a minus, not a plus, with extra bonus points for undermining anything associated with President Barack Obama.
And if all this sounds too petty and vindictive to be the basis for momentous policy decisions, consider the character of the man in the White House. Need I say more?

Thursday, June 01, 2017

The Working Class’s Role in Trump’s Election

Caroline Freund:

The working class’s role in Trump’s election: President Donald Trump’s election victory last year was driven in part by support he got in the traditionally Democratic parts of the industrial Northeast and Midwest of the US. Many analysts have argued that Trump’s promises to bring back US manufacturing hollowed out by trade and technology changes paved the way for his achievement.
Recent empirical evidence shows that trade shocks can influence voting patterns. Autor et al. (2016) find that import competition from China is associated with increased political polarisation in US congressional elections, as measured by the number of moderate incumbents who lost their seats. Using data on voting patterns in six presidential elections, Jensen et al. (2016) extend this analysis to include trade in services and exports, and find that while rising imports are associated with more polarisation, rising exports are associated with more support for the incumbent. Che et al. (2016) find that greater import competition from China is correlated with increases in election turnout and the share of votes for a Democrat in congressional elections. 
Evidence that the decline in manufacturing was not the real reason for Trump’s success
The data show that this bit of conventional wisdom might be misplaced. Education and race were far bigger factors in determining the change in voting results from the 2012 election.  These two factors alone explain more than 70% of the variation in the Republican vote share across counties, as compared with the last election, and more than 80% in the swing states.
And within manufacturing, race mattered greatly: only the predominantly white manufacturing counties were drawn to Trump’s message.  Racially diverse manufacturing counties rejected it.  These twin factors roughly cancelled each other out. In the end, whether or not manufacturing was part of a county’s economic base did not have much of an effect on its change in voting behaviour.
In a new paper, Dario Sidhu and I examine electoral data from the 2016 compared with previous presidential elections (Freund and Sidhu 2017). The county-by-county breakdown in the data shows that on aggregate, manufacturing jobs did not play a significant role in the election results.
When economics, identity, and demographic variables were considered together, the share of employees in manufacturing was not significantly associated with increased support for Donald Trump, versus Mitt Romney in 2012. Even more striking, counties where manufacturing declined since 2000 – many of which received special attention during the campaign – also did not have an increase in their vote share for Trump from four years before.
None of this is to say manufacturing as an economic foundation for a county did not matter at all in the election. But it boosted Trump only in counties that were predominately white.
In mostly white manufacturing counties, there was a significant increase in the Republican vote share since 2012. In more racially and ethnically diverse manufacturing counties (above average share of black and Hispanic residents), there was a significant decline in the share of votes going to the Republican candidate. On aggregate, these effects roughly offset each other, with the net result that the presence of manufacturing in a county (or the extent of job loss) was not associated with the result. To the extent manufacturing played a role, it was through the ethnic makeup of counties. The impact of this effect was magnified in crucial swing states, where counties are on average less diverse than the nation as a whole.

Figure 1 Republican vote share change from 2012 to 2016 and manufacturing employment


Notes: Standardized coefficients.  Additional controls, median wage, unemployment, labour force participation, age, religion, county size. 
Source: Freund and Sidhu (2017).

Why are counties polarised within manufacturing by race?
There are two potential explanations for why predominantly white manufacturing counties became more Republican and diverse manufacturing counties voted more Democratic in this election. 
The first is that economic shocks were different across white and diverse counties.  Perhaps white manufacturing towns specialise in products more prone to technological change or facing pronounced import competition; alternatively, white manufacturing towns may have been largely one company towns with few alternative employment opportunities.
The second is that the two groups reacted differently to economic changes that have occurred over time.  It is possible that white manufacturing towns rejected existing policies, such as openness to trade and increased income redistribution (for example, through the Affordable Care Act); while diverse manufacturing towns rejected the message that economic conditions in the US were deteriorating.
The analysis shows that the second explanation – different reactions to economic change – is more consistent with the data. Perhaps most telling, comparing the 2016 election results with the county’s share of employment in manufacturing from 1986 – when manufacturing employment was near its peak and one in four manufacturing workers was in a union – the same polarisation is evident.  Historical manufacturing counties that are mostly white voted more Republican, but historical manufacturing towns that are relatively diverse voted more Democratic, as compared with 2012. 
Does this mean the population is becoming more polarised?
Morris Fiorina, a political scientist at Stanford University, has shown that polarisation can be driven by the electorate or the candidates (Fiorina 2004). While a polarised population – with a large group on the right and a large group on the left – produces a split electorate, polarising candidates can yield a similar outcome, even if most of the population has centrist political views. The difference is that with an increasingly polarised electorate, voter participation should logically increase, as each group is tied to its candidate and opposed to the alternate. In contrast, with polarising candidates, the middle of the distribution is unsatisfied, so voter participation should in theory decrease.
When other factors are eliminated, the data show that the rise in the Republican share of votes in white manufacturing counties was largely due to a drop in Democratic votes; while the rise in the Democratic share in non-white manufacturing counties was driven by a relatively higher drop in Republican votes.  In addition, on average across counties, as compared with 2012, relatively low voting rates among Democratic voters was a bigger contributor to the results than high voting rates among Republicans. Put differently, Trump did not win the white working class, Clinton lost it.
The 2016 election outcome is thus more consistent with Fiorina’s example of polarising candidates than a polarised electorate.  The good news is that Americans are probably far less divided then they appear. The bad news is that the US desperately needs a more centrist and less partisan government to unify and lead, but that seems unlikely anytime soon.
Autor, D, D Dorn, G Hanson, and K Majlesi (2016), “Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure”, NBER Working Paper No. 22637.
Che, Y, Y Lu, J R Pierce, P K Schott and Z Tao (2016), “Does Trade Liberalization with China Influence US Elections?”, NBER Working Paper No. 22178.
Fiorina, M (2004), Culture War? The Myth of a Polarized America, Stanford University Press.
Freund, C and D Sidhu (2017), “Manufacturing and the 2016 Election: An Analysis of US Presidential Election Data”, PIIE Working Paper No. 17-7. 
Jensen, J B, D P Quinn and Ss Weymouth (2016): “Winners and Losers in International Trade: The Effects on US Presidential Voting,” NBER Working Paper No. 21899.

Monday, May 29, 2017

Paul Krugman: Trump’s Energy, Low and Dirty

King Coal has a scary soul:

Trump’s Energy, Low and Dirty, by Paul Krugman, NY Times: Donald Trump has two false beliefs about energy, one personal, one political. ...
On the personal side, Trump reportedly disdains exercise of any kind except golf. He believes that raising a sweat depletes the finite reserves of precious bodily fluids, I mean energy, that a person is born with, and should therefore be avoided.
Many years of acting on this belief may or may not explain the weird and embarrassing scene at the G-7 summit in Taormina, in which six of the advanced world’s leaders strolled together a few hundred yards through the historic city, but Trump followed behind, driven in an electric golf cart.
More consequential, however, is Trump’s false belief that lifting environmental restrictions ... will bring back the days when the coal-mining industry employed hundreds of thousands of blue-collar Americans. ...
These days..., those who take energy policy seriously see a future that belongs largely to renewables... But that’s not what voters from what used to be coal country want to hear. They enthusiastically backed Trump, who promised to bring those coal jobs back, even though his real agenda would punish those voters with savage cuts in programs they depend on. And Trump cares a lot more about public adulation than he does about serious policy advice.
Which brings me ... to Trump’s European trip...
First, in Brussels, he declined to endorse NATO’s Article 5, which says that an attack on any NATO member is an attack on all. In effect, he repudiated the central plank of America’s most important alliance. Why, it was almost as if he’s more interested in appeasing Vladimir Putin than he is in defending democracy.
Then, in Taormina, he was the only leader who refused to endorse the Paris climate accord ... that may be our last good chance to avoid catastrophic climate change. ... But Trump isn’t offering coal country real help, just a fantasy about turning back the clock. ...
So am I suggesting that the world’s most powerful leader might put the whole planet’s future at risk so that he can keep telling politically convenient lies...? Yes. ...
Now, maybe Trump won’t really pull the plug on Paris; or maybe he’ll be gone from the scene before the damage is irreversible. But there’s a real possibility that last week was a pivotal moment in human history, the moment when an irresponsible leader sent the whole world careening off to hell in a golf cart.

Friday, May 26, 2017

Paul Krugman: It’s All About Trump’s Contempt

"The mother of all sucker punches":

It’s All About Trump’s Contempt, by Paul Krugman, NY Times: For journalists covering domestic policy, this past week poses some hard choices. Should we focus on the Trump budget’s fraudulence — not only does it invoke $2 trillion in phony savings, it counts them twice — or on its cruelty? Or should we talk instead about the Congressional Budget Office assessment of Trumpcare, which would be devastating for older, poorer and sicker Americans?
There is, however, a unifying theme to all these developments. And that theme is contempt — Donald Trump’s contempt for the voters who put him in office. ... He is ... betting that he can break every promise he made to the working-class voters who put him over the top, and still keep their support. Can he win that bet?
When it comes to phony budget math — remember his claims that he would pay off the national debt? — he probably can. ...
The bigger question is whether someone who ran as a populist, who promised not to cut Social Security or Medicaid, who assured voters that everyone would have health insurance, can keep his working-class support while pursuing an agenda so anti-populist it takes your breath away. ...
So what did [Trump voters] think they were voting for? Partly,... they ... believed that he was a different kind of Republican. Maybe he would take benefits away from Those People, but he would protect the programs white working-class voters ... depend on.
What they got instead was the mother of all sucker punches.
Trumpcare, the budget office tells us, would cause 23 million people to lose health insurance, largely through cuts to Medicaid... It would also lead to soaring premiums — we’re talking increases on the order of 800 percent — for older Americans whose incomes are low but not low enough to qualify for Medicaid. That describes a lot of Trump voters. Then we need to add in the Trump budget, which calls for further drastic cuts in Medicaid, plus large cuts in food stamps and in disability payments. ...
So many of the people who voted for Donald Trump were the victims of an epic scam by a man who has built his life around scamming. ...
Will they ever realize this, and admit it to themselves? More important, will they be prepared to punish him the only way they can — by voting for Democrats?

Thursday, May 25, 2017

Blinder: Why, After 200 Years, Can’t Economists Sell Free Trade? (Video)

Wednesday, May 24, 2017

Trump’s “China Deal” is Only a Good Deal for China

Larry Summers:

Trump’s “China deal” is only a good deal for China: The events of the last week have crowded out reflection on economic policy.  But things have been happening. Commerce Secretary Wilbur Ross described the trade deal reached with China earlier this month as “pretty much a herculean accomplishment….This is more than has been done in the history of U.S.-China relations on trade.”
Past a certain point, exaggeration and hype become dishonesty and deception. In economic policy, as in almost everything else, the Trump Administration is way past that point.
The trade deal is a “nothing burger” that a serious Administration committed to helping American workers would likely not have accepted, and surely would not have hyped. ... [gives details of the agreement] ...
Now it is true that a ludicrously hyped squib of a deal is much better than a trade war. So perhaps we should be pleased that the President and his commerce secretary are so easily manipulated. Perhaps our officials know how bad a deal they got and are just hyping for political reasons.
It is an irony of our times that those who most frequently denounce “fake news” seem to most frequently purvey it.

Tuesday, May 23, 2017

It’s Time to Worry about Health Care in the Senate

David Leonhardt

It’s Time to Worry about Health Care in the Senate, NY Times: While the rest of the country has been transfixed by Trumpian chaos, members of the Senate have spent the last two weeks talking about taking health insurance from millions of Americans.
There is an alarmingly large chance that they’ll decide to do so. But if they do, they will almost certainly rely on a political sleight of hand to disguise their bill’s damage. Understanding that sleight of hand — and calling attention to it — offers the best hope for defeating the bill.
The effort to take health insurance from the middle class and poor and funnel the savings into tax cuts for the rich is a little like mold. It grows best in the dark. ...
If secrecy is the first part of the strategy, distraction is the second. ...
The final part of the strategy will be arm-twisting. If victory is in sight, McConnell will invoke party loyalty to cajole his colleagues... Being the Republican who brought down Trumpcare wouldn’t be fun.
So the current period is important. It’s a time for all those groups that oppose the bill, and for the engaged progressive base, to put senators on notice. ...
A small group of Senate Republicans has shown signs of being persuadable, and only three are likely needed to stop a bill. The group includes Lamar Alexander, Shelley Moore Capito, Bill Cassidy, Susan Collins, Dean Heller, Lisa Murkowski and Rob Portman.
They should hear a loud message that Americans aren’t in favor of taking health insurance from their fellow citizens. The senators work for those citizens, not for Mitch McConnell, Paul Ryan and Donald Trump.

Trump’s Budget is Simply Ludicrous

Larry Summers:

Trump’s budget is simply ludicrous: Details of President Trump’s first budget have now been released. Much can and will be said about the dire social consequences about what is in it and the ludicrously optimistic economic assumptions it embodies. My observation is that there appears to be a logical error of the kind that would justify failing a student in an introductory economics course.
Apparently, the budget forecasts that US growth will rise to 3.0 percent because of the Administration’s policies—largely its tax cuts and perhaps also its regulatory policies. Fair enough if you believe in tooth-fairies and ludicrous supply-side economics.
Then the Administration asserts that it will propose revenue neutral tax cuts with the revenue neutrality coming in part because the tax cuts stimulate growth! This is an elementary double count. You can’t use the growth benefits of tax cuts once to justify an optimistic baseline and then again to claim that the tax cuts do not cost revenue. At least you cannot do so in a world of logic. ...
This is a mistake no serious business person would make. It appears to be the most egregious accounting error in a Presidential budget in the nearly 40 years I have been tracking them. ...
I have no doubt that there are civil servants in OMB, Treasury and CEA who do know better than this mistake. Were they cowed, ignored or shut out? How could the Secretary of Treasury, Director of OMB and Director of the NEC allow such an elementary error? I hope the press will ferret all this out.
The President’s personal failings are now not just center stage but whole stage. They should not blind us to the manifest failures of his economic team. Whether it is Secretary Mnuchin’s absurd claims about tax cuts not favoring the rich, Secretary Ross’s claim that the small squib of a deal negotiated last week with China was the greatest trade result with China in history, NEC Director Cohn’s ludicrous estimate of the costs of Dodd Frank, or today’s budget, the Trump administration has not yet made a significant economic pronouncement that meets a minimal standard of competence and honesty.

Monday, May 22, 2017

Paul Krugman: The Unfreeing of American Workers

Freedom's just another word for nothing left to lose:

The Unfreeing of American Workers, by Paul Krugman, NY Times: American conservatives love to talk about freedom. ... Well, why not? After all, America is an open society, in which everyone is free to make his or her own choices about where to work and how to live.
Everyone, that is, except the 30 million workers now covered by noncompete agreements, who may find themselves all but unemployable if they quit their current jobs; the 52 million Americans with pre-existing conditions who will be effectively unable to buy individual health insurance, and hence stuck with their current employers, if the Freedom Caucus gets its way; and the millions of Americans burdened down by heavy student and other debt. ...
And you can make a strong case that we’re getting less free as time goes by.
Let’s talk first about those noncompete agreements... Noncompete agreements were originally supposed to be about protecting trade secrets... And that’s perfectly reasonable.
At this point, however, almost one in five American employees is subject to some kind of noncompete clause..., noncompete clauses are in many cases less about protecting trade secrets than they are about tying workers to their current employers, unable to bargain for better wages or quit to take better jobs.
This shouldn’t be happening in America... But there’s another aspect of declining worker freedom...: health care.
Until 2014, there was basically only one way Americans under 65 with pre-existing conditions could get health insurance: by finding an employer willing to offer coverage. ...
But what if you wanted to change jobs, or start your own business? Too bad: you were basically stuck...
Then Obamacare went into effect, guaranteeing affordable care even to those with pre-existing medical conditions. This was a hugely liberating change for millions. ...
But maybe not for much longer. Trumpcare ... would drastically reduce protections for Americans with pre-existing conditions. And even if that bill never becomes law, the Trump administration is effectively sabotaging individual insurance markets, so that in many cases Americans who lose employer coverage will have no place to turn...
You might say, with only a bit of hyperbole, that workers in America, supposedly the land of the free, are actually creeping along the road to serfdom, yoked to corporate employers the way Russian peasants were once tied to their masters’ land. And the people pushing them down that road are the very people who cry “freedom” the loudest.

The Heartless Tradeoffs in the Trump Budget

I have a new column:

The Heartless Tradeoffs in the Trump Budget: As the bombshells continue to drop on the Trump administration, behind the scenes Trump’s first detailed budget proposal is being developed, and it has a few bombshells of its own, particularly for the poor. The budget proposal is not yet finalized, so the details could change, but according to what has leaked so far, the budget is a combination of tax cuts for the wealthy, reduced spending on social programs that serve the needy, and wishful thinking about tax cuts and economic growth. ...

Monday, May 15, 2017

Paul Krugman: The Priming of Mr. Donald Trump

"a delusion of truly Trumpian proportions":

The Priming of Mr. Donald Trump, by Paul Krugman, NY Times: Donald Trump has said many strange things in recent interviews. ... Over here in Econoland, however, the buzz was all about Trump’s expressed willingness, in an interview with the Economist magazine, to pursue tax cuts even if they increase deficits, because “we have to prime the pump” — an expression he claimed to have invented. “I came up with it a couple of days ago and I thought it was good.”
Actually, the expression goes back generations...
But why should anyone besides pedants care?
First, a mind is a terrible thing to lose..., that Economist interview was basically one long senior moment...
Second, we’re talking about some really bad economics here. ...
America may not be all the way back to full employment — there’s a lively debate among economists over that issue. But the economic engine no longer needs a fiscal jump-start. This is exactly the wrong time to be talking about the desirability of bigger budget deficits. ...
Which brings me to my third point: Trump’s fiscal delusions are arguably no worse than those of many, perhaps most professional observers of the Washington political scene.
If you’re a heavy news consumer, think about how many articles you’ve seen in the past few weeks with headlines along the lines of “Trump’s budget may create conflict with G.O.P. fiscal conservatives.” The premise ... is that there is a powerful faction among Republican members of Congress who worry deeply about budget deficits...
But there is no such faction, and never was.
There were and are poseurs like Paul Ryan, who claim to be big deficit hawks. But there’s a simple way to test such people’s sincerity:... when you see a politician claim that deficit concerns require that we slash Medicaid, privatize Medicare, and/or raise the retirement age — but somehow never require raising taxes on the wealthy, which in fact they propose to cut — you know that it’s just an act.
Yet somehow much of the news media keeps believing, or pretending to believe, that those imaginary deficit hawks are real, which is a delusion of truly Trumpian proportions.
So I’m worried. Trump may be not just ignorant but deeply out of it, and his economic proposals are terrible and irresponsible, but they may get implemented all the same.
But maybe I worry too much; maybe the only thing to fear is fear itself. Do you like that line? I just came up with it the other day.

Friday, May 12, 2017

Paul Krugman: Judas, Tax Cuts and the Great Betrayal

"almost an entire party appears to have decided that potential treason in the cause of tax cuts for the wealthy is no vice":

Judas, Tax Cuts and the Great Betrayal, by Paul Krugman, NY Times: The denarius, ancient Rome’s silver coin, was supposedly the daily wage of a manual worker. If so, the tax cuts that the richest 1 percent of Americans will receive if the Affordable Care Act is repealed — tax cuts that are, obviously, the real reason for repeal — would amount to the equivalent of around 500 pieces of silver each year.
What inspired this calculation? The spectacle of Mitch McConnell, the Senate majority leader, and Paul Ryan, the speaker of the House, defending Donald Trump’s firing of James Comey.
Everyone understands that Mr. Comey was fired ... because his probe of Russian connections with the Trump campaign was accelerating and, presumably, getting too close to home. So this looks very much like the use of presidential power to cover up possible foreign subversion of the U.S. government.
And the two leading Republicans in Congress are apparently O.K. with that cover-up, because the Trump ascendancy is giving them the chance to do what they always wanted, namely, take health insurance away from millions of Americans while slashing taxes on the wealthy.
So you can see why I find myself thinking of Judas.
For generations, Republicans have impugned their opponents’ patriotism. ...
But now we have what may be the real thing: circumstantial evidence that a hostile foreign power may have colluded with a U.S. presidential campaign, and may retain undue influence at the highest levels of our government. And all those self-proclaimed patriots have gone silent, or worse. ...
And we know how to resolve the remaining uncertainty: independent investigations...
At this point ... almost an entire party appears to have decided that potential treason in the cause of tax cuts for the wealthy is no vice. And that’s barely hyperbole. ...
So it’s naïve to expect Republicans to join forces with Democrats to get to the bottom of the Russia scandal — even if that scandal may strike at the very roots of our national security. Today’s Republicans just don’t cooperate with Democrats, period. They’d rather work with Vladimir Putin.
In fact, some of them probably did.
Now, maybe I’m being too pessimistic. Maybe there are enough Republicans with a conscience — or, failing that, sufficiently frightened of an electoral backlash — that the attempt to kill the Russia probe will fail. One can only hope so.
But it’s time to face up to the scary reality here. Most people now realize, I think, that Donald Trump holds basic American political values in contempt. What we need to realize is that much of his party shares that contempt.

Monday, May 08, 2017

The Great Risk Shift is Back

I have a new column:

Killing Banking Rules Will Invite a Whopper of a Recession: The vote in the House of Representatives to dismantle Obamacare was not the only attempt to undo key legislation from the Obama years that occurred last Thursday. Though it mostly went unnoticed, the House Financial Services Committee voted in favor of the Financial Choice Act. This legislation would substantially weaken the Dodd-Frank financial reforms.
If the Republicans are successful, and that is not assured at this point for either piece of legislation, it will increase economic insecurity for most households. ...

Paul Krugman: Republicans Party Like It’s 1984

"This is an act of deliberate betrayal":

Republicans Party Like It’s 1984, by Paul Krugman, NY Times: There have been many bad laws in U.S. history. ... But has there ever been anything like Trumpcare...? It’s a miserably designed law, full of unintended consequences. It’s a moral disaster, snatching health care from tens of millions mainly to give the very wealthy a near-trillion-dollar tax cut.
What really stands out, however, is the Orwell-level dishonesty of the whole effort. As far as I can tell, every word Republicans, from Trump on down, have said about their bill — about why they want to replace Obamacare, about what their replacement would do, and about how it would work — is a lie, including “a,” “and” and “the.”
And what does it say about the state of American politics that a majority of the representatives of one of our major political parties have gone along with this nightmarish process? ... Trumpcare breaks every promise Republicans ever made about health ... and ... they are doing so with intent. ... This is an act of deliberate betrayal.
...Why are they doing this, and why do they think they can get away with it?
Part of the answer to the first question is, presumably, simple greed. Tens of millions would lose access to health coverage, but ... people with incomes over $1 million would save an average of more than $50,000 a year.
And there is a powerful faction within the G.O.P. for whom cutting taxes on the rich is more or less the only thing that matters. ...
As for why they think they can get away with it: Well, isn’t recent history on their side? The general shape of what the G.O.P. would do to health care, for the white working class in particular, has long been obvious, yet many people who were sure to lose, bigly, voted Trump anyway.Why shouldn’t Republicans believe they can convince those same voters that the terrible things that will happen if Trumpcare becomes law are somehow liberals’ fault?
And for that matter, how confident are you that mainstream media will resist the temptation of both-sides-ism, the urge to produce “balanced” reporting that blurs the awful reality of what Trumpcare will do if enacted?
In any case, let’s be clear: What just happened on health care shouldn’t be treated as just another case of cynical political deal making. This was a Freedom is Slavery, Ignorance is Strength moment. And it may be the shape of things to come.

Friday, May 05, 2017

Paul Krugman: What’s the Matter With Europe?

If Macron wins, will the European elite learn the wrong lesson?:

What’s the Matter With Europe?, by Paul Krugman, NY Times: On Sunday France will hold its presidential runoff. Most observers expect Emmanuel Macron, a centrist, to defeat Marine Le Pen, the white nationalist — please, let’s stop dignifying this stuff by calling it “populism.” ... A Le Pen victory would be a disaster for Europe and the world.
Yet I also think it’s fair to ask a couple of questions... First, how did things get to this point? Second, would a Le Pen defeat be anything more than a temporary reprieve from the ongoing European crisis? ...
To begin, while France gets an amazing amount of bad press — much of it coming from ideologues who insist that generous welfare states must have disastrous effects — it’s actually a fairly successful economy. ...
Meanwhile..., France offers a social safety net beyond the wildest dreams of U.S. progressives... So why are so many willing to vote for — again, let’s not use euphemisms — a racist extremist?
There are, no doubt, multiple reasons, especially cultural anxiety over Islamic immigrants. But it seems clear that votes for Le Pen will in part be votes of protest against what are perceived as the highhanded, out-of-touch officials running the European Union. And that perception unfortunately has an element of truth.
Those of us who watched European institutions deal with the debt crisis ... were shocked at the ... callousness and arrogance that prevailed throughout. ...
Politically, Eurocrats got away with this behavior because small nations were easy to bully... But Europe’s elite will be making a terrible mistake if it believes it can behave the same way to bigger players.
Indeed, there are already intimations of disaster in the negotiations now taking place between the European Union and Britain. ... E.U. officials are sounding more and more like a jilted spouse determined to extract maximum damages in a divorce settlement. ...Greece-style bullying just isn’t going to work on a nation as big, rich and proud as the U.K.
Which brings me back to the French election. We should be terrified at the possibility of a Le Pen victory. But we should also be worried that a Macron victory will be taken by Brussels and Berlin to mean that Brexit was an aberration, that European voters can always be intimidated into going along with what their betters say is necessary.
So let’s be clear: Even if the worst is avoided this Sunday, all the European elite will get is a time-limited chance to mend its ways.

Friday, April 28, 2017

Paul Krugman: Living in the Trump Zone

"Don’t pretend that this is normal":

Living in the Trump Zone, by Paul Krugman, NY Times: Fans of old TV series may remember a classic “Twilight Zone” episode titled “It’s a Good Life.” It featured a small town terrorized by a 6-year-old who for some reason had monstrous superpowers, coupled with complete emotional immaturity. Everyone lived in constant fear, made worse by the need to pretend that everything was fine. After all, any hint of discontent could bring terrible retribution.
And now you know what it must be like working in the Trump administration. ...
What set me off on this chain of association? The answer may surprise you; it was the tax “plan” the administration released on Wednesday..., the single-page document ... bore no resemblance to what people normally mean when they talk about a tax plan. ...
So why would the White House release such an embarrassing document? Why would the Treasury Department go along with this clown show?...
Every report from inside the White House conveys the impression that Trump is like a temperamental child, bored by details and easily frustrated when things don’t go his way... If he says he wants something, no matter how ridiculous, you say, “Yes, Mr. President!”; at most, you try to minimize the damage.
Right now, by all accounts, the child-man in chief is in a snit over the prospect of news stories that review his first 100 days and conclude that he hasn’t achieved much if anything (because he hasn’t). So last week he announced the imminent release of something he could call a tax plan. ... But nobody dared tell him it couldn’t be done. Instead, they released … something, with nobody sure what it means.
And the absence of a real tax plan isn’t the only thing the inner circle apparently doesn’t dare tell him. ...
...I’d like to make a plea to my colleagues in the news media: Don’t pretend that this is normal. Let’s not act as if that thing released on Wednesday, whatever it was, was something like, say, the 2001 Bush tax cut; I strongly disapproved of that cut, but at least it was comprehensible. Let’s not pretend that we’re having a real discussion of, say, the growth effects of changes in business tax rates.
No, what we’re looking at here isn’t policy; it’s pieces of paper whose goal is to soothe the big man’s temper tantrums. Unfortunately, we may all pay the price of his therapy.

Monday, April 24, 2017

Paul Krugman: Zombies of Voodoo Economics

 "Because it offers a rationale for lower taxes on the wealthy":

Zombies of Voodoo Economics, by Paul Krugman, NY Times: According to many reports, Donald Trump is getting frantic as his administration nears the 100-day mark. It’s an arbitrary line in the sand, but one he himself touted in many pre-inauguration boasts. And it will be an occasion for numerous articles detailing how little of substance he has actually accomplished. ...
Mr. Trump sold himself to voters as unorthodox as well as effective. He was going to be a different kind of president, a consummate deal-maker who would transcend the usual ideological divide. His supporters should therefore be dismayed, not just by his failure to actually close any deals, but by the fact that he evidently has no new ideas to offer, just the same old snake oil the right has been peddling for decades.
We saw that on Trumpcare... And now we’re seeing it on taxes. ... Whatever the details, Trumptax will be a big exercise in fantasy economics.
How do we know this? Last week Stephen Mnuchin, the Treasury secretary, told a financial industry audience that “the plan will pay for itself with growth.” And we all know what that means..., history offers not a shred of support for faith in the pro-growth effects of tax cuts..., supply-side economics is a classic example of a zombie doctrine: a view that should have been killed by the evidence long ago... Why, then, does it persist? Because it offers a rationale for lower taxes on the wealthy...
Still, Donald Trump was supposed to be different. Guess what: he isn’t.
To be fair, it’s not clear whether Mr. Trump really believes in right-wing economic orthodoxy. He may just be looking for something, anything, he can call a win — and it’s a lot easier to come up with a tax reform plan if you don’t try to make things add up, if you just assume that extra growth and the revenue it brings will materialize out of thin air.
We might also note that a man who insists that he won the popular vote he lost, who insists that crime is at a record high when it’s at a record low, doesn’t need a fancy doctrine to claim that his budget adds up when it doesn’t.
Still, the fact is that the Trump agenda so far is absolutely indistinguishable from what one might have expected from, say, Ted Cruz. It’s just voodoo with extra bad math. Was that what his supporters expected?

Friday, April 21, 2017

Paul Krugman: The Balloon, the Box and Health Care

If they persist in trying to fit the balloon in the box, eventually it will pop:

The Balloon, the Box and Health Care, by Paul Krugman, NY Times: Imagine a man who for some reason is determined to stuff a balloon into a box — a box that, aside from being the wrong shape, just isn’t big enough. He starts working at one corner, pushing the balloon into position. But then he realizes that the air he’s squeezed out at one end has caused the balloon to expand elsewhere. So he tries at the opposite corner, but this undoes his original work.
If he’s stupid or obsessive enough, he can spend a long time at this exercise, trying it from various different angles, and maybe even briefly convince himself that he’s making progress. But he’s kidding himself: No matter what he does, the balloon isn’t going to fit in that box.
Now you understand what’s happening to G.O.P. efforts to repeal and replace the Affordable Care Act.
Republicans have spent many years denouncing Obamacare as a terrible, horrible, no good law and insisting that they can do much better. They successfully convinced many voters that they could preserve the good stuff — the dramatic expansion of coverage that has brought the percentage of Americans without health insurance to a record low — while reducing premiums, shrinking deductibles and, of course, doing away with the taxes on high incomes that pay for the program.
Those promises basically define the box into which they’re trying to stuff health care. ...
Again and again, we read news reports to the effect that Republicans are closing in on a plan that will break the political deadlock..., the latest idea being floated, they’ll let insurance companies raise premiums on people with pre-existing conditions and compensate by creating special high-risk pools! ...
And because the task Republicans have set for themselves is basically impossible, their ongoing debacle over health care isn’t about political tactics or leadership..., this thing just can’t work. ...
All of this raises the obvious question: If Republicans never had a plausible alternative to Obamacare, if this debacle was so inevitable, what was the constant refrain of “repeal and replace” all about?
The answer, surely, is that it began as a cynical ploy; at first, the Republicans hoped to kill health reform before it really got started. And now they’ve trapped themselves: They can’t admit that they have no ideas without, in effect, admitting that they were lying all along.
And the result is that they just keep trying to stuff the balloon into that box.

Thursday, April 20, 2017

GE2017: Why Economic Facts will be Ignored Once Again

Simon Wren-Lewis:

GE2017: Why economic facts will be ignored once again: In 2015, the Conservatives spun the line that Labour profligacy had messed up the economy, and they had no choice but to clear up the mess. In short, austerity was Labour’s fault. As Labour chose not to challenge this narrative, almost all the media and half the voters assumed it must be true. The reality was the complete opposite. The rising deficit was a consequence of the global financial crisis, not Labour profligacy. Doing something about it should and could have been delayed until the recovery was underway. By acting prematurely, Osborne delayed the recovery and lost the average UK household resources worth thousands of pounds. The story that we had to cut now because of the markets was completely false. ...
The 2015 General Election was the first recent occasion that the economic facts were ignored. The second was of course the EU referendum. ...
A critical issue during the referendum was a belief that immigration had reduced the access of UK natives to public services. Economists know that is simply wrong for the economy as a whole, and if it happens locally it is because the government has pocketed the taxes immigrants pay. But the media did little to inform voters of why it is wrong, and I suspect this is why most of those voting Leave believed they would be no worse off in the long run outside the EU. ...
Brexit may not have led to the immediate economic downturn that some expected, but the Brexit depreciation has brought to a halt the short period during of rising real wages. The economic pain that economists said would follow any vote to leave is starting to happen. ...
As far as economics is concerned GE2017 is likely to be nothing more than a combination of GE2015 and the EU referendum. The economy has not got any better than in 2015, and is about to get worse, but mediamacro will let Conservatives insist that the economy is strong. ... The exchange rate has fallen and real wages have stopped rising, but we will still be told this is just Project Fear and the consensus among economists will get ignored once again. So, for the third time, we will have a vote where economics is critical but economic facts will be largely ignored. ...
As inflation rises and real wages fall the facts may be changing, but the narrative survives.
Narratives are a way people can try to understand things they know little about, and most people know little about economics or politics. Mediamacro is a set of narratives. Project fear is a narrative. The right and the ideologues are very good at selling narratives, and they have a media machine to invent them, road test them and spread them. The left and the realists have none of those things, and are hopeless at it anyway because they know reality is more complex than most narratives. That is why they have lost two elections, and look like losing a third big time.