Ezra Klein - Economic and Domestic Policy, and Lots of It - August 1, 2010

Reconciliation

Recap: Infomercials and tax cuts; the July jobs report; and the problem with Larry Summers. Reconciliation: 1) Lindsey Graham argues that modifying the 14th Amendment will be easy and will lead to humane immigration reform. 2) Four reasons not to...

By Ezra Klein | August 6, 2010; 6:44 PM ET | Permalink | Comments (10)

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On Paul Ryan

A number of you have written to ask what I think of Paul Krugman's column attacking Paul Ryan's budget. As far as Krugman's policy critique goes, I agree. I'd refer people back to my post "Paul Ryan's budget proposal does...

By Ezra Klein | August 6, 2010; 5:50 PM ET | Permalink | Comments (72)

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Because the Founding Fathers wanted the government understaffed

I don't know that I have anything new to say on the absurdity of Peter Diamond's nomination to the Federal Reserve's Board of Governors being held up, but I'd just observe that this is the everyday price of the Senate's...

By Ezra Klein | August 6, 2010; 5:06 PM ET | Permalink | Comments (9)
Categories: Senate
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The problem with Larry Summers

You're seeing some White House pushback on the idea that Christina Romer is leaving because she's tired of fighting with Larry Summers. And fair enough: People do tire of serving in the pressure cooker that is the White House,...

By Ezra Klein | August 6, 2010; 4:39 PM ET | Permalink | Comments (20)
Categories: Obama administration
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Lame ducks worry about lame ducks

Republican worries about Democrats using a lame-duck session of Congress to ram unpopular legislation through the upper chamber are, well, puzzling. Democrats don't have 60 votes now and they won't have 60 votes after Nov. 2. There is no way...

By Ezra Klein | August 6, 2010; 3:11 PM ET | Permalink | Comments (18)

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Welcome to post-stimulus America

The New York Times sends a postcard: Plenty of businesses and governments furloughed workers this year, but Hawaii went further — it furloughed its schoolchildren. Public schools across the state closed on 17 Fridays during the past school year to...

By Ezra Klein | August 6, 2010; 2:14 PM ET | Permalink | Comments (12)

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What can't the Bush tax cuts do?

The joy of watching infomercials is finding out how many uses one object can possibly have. A food processor can slice, dice and receive AM radio stations. An absorbent material can be used to scrub, soak, dust, and in...

By Ezra Klein | August 6, 2010; 1:35 PM ET | Permalink | Comments (30)
Categories: Taxes
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Lunch Break

I was reading Tom Junod's profile of Mr. Rogers, and it sent me down the YouTube rabbit hole. Has anyone ever had a more comforting voice?...

By Ezra Klein | August 6, 2010; 12:23 PM ET | Permalink | Comments (3)

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Research desk is open

Wha'cha got?...

By Ezra Klein | August 6, 2010; 11:56 AM ET | Permalink | Comments (22)

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What is the White House thinking?

Readers know I try not to spend much time second-guessing political messaging, but I am absolutely baffled by the White House's behavior in the run-up to this jobs report. Keep in mind that this report was predictable. We knew...

By Ezra Klein | August 6, 2010; 11:13 AM ET | Permalink | Comments (27)

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Hey look!

It's a new Dave Weigel blog!...

By Ezra Klein | August 6, 2010; 10:59 AM ET | Permalink | Comments (1)

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The political logic of job losses

Matt Yglesias puts a finer point on the political history behind, and electoral implications of, today's jobs report: The losses came from the public sector. And they were foreseeable. And they were foreseen by the President of the United States...

By Ezra Klein | August 6, 2010; 10:20 AM ET | Permalink | Comments (24)

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Jobs report: Public sector loses 202,000 jobs; private sector gains 71,000

The July jobs report is bad news for jobs, but tepidly good news for recovery. Another 143,000 census positions expired, contributing to a total public sector job loss of more than 200,000 jobs. But the private sector continued to...

By Ezra Klein | August 6, 2010; 9:03 AM ET | Permalink | Comments (61)
Categories: Economy
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Wonkbook: Romer out; Voinovich questions tax cuts; Kagan confirmed; Delicious lobster

Lots of economic news today: Council of Economic Advisors chair Christina Romer is resigning at the end of the month, which, combined with Peter Orszag's departure, leaves the Obama economic team without two of its lead players. MIT professor...

By Ezra Klein | August 6, 2010; 6:32 AM ET | Permalink | Comments (11)
Categories: Wonkbook
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Reconciliation

Recap: The oddness of the conservative effort to undermine health-care reform; hidden Washington; and how the slow economy has become a boon for pundits. Elsewhere: 1) Conservatives heart Chris Christie. 2) A defense of the Senate. 3) Seyward Darby wishes...

By Ezra Klein | August 5, 2010; 6:34 PM ET | Permalink | Comments (2)

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Does restricting immigration improve economic performance?

There are a lot of studies looking at the economic impacts of immigration, but what about the economic impacts of restricting immigration? Over the past few years, a lot of cities and counties have enacted restrictive laws, which creates a...

By Ezra Klein | August 5, 2010; 5:51 PM ET | Permalink | Comments (13)
Categories: Immigration
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Research Desk explains: What would a progressive consumption tax look like?

By Dylan Matthews Matt Lewis asks: What would a truly progressive consumption tax look like? Currently, the personal income tax applies, as its name suggests, to all income. Salaries, wages and so forth are taxed whether or not they are...

By Ezra Klein | August 5, 2010; 4:52 PM ET | Permalink | Comments (8)
Categories: Taxes
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Thought experiment

What would the unemployment rate be right now if John McCain had won the presidency? Why? I'm much more interested in why it plausible arguments and mechanisms for why it would be lower than why it would be higher. And...

By Ezra Klein | August 5, 2010; 4:46 PM ET | Permalink | Comments (25)

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Punditry is counter-cyclical

Business are making a lot of money right now. But they're not hiring. That's bad for the economy, but it's been good for commentators who can say that the reason they're not hiring is because the government is doing things...

By Ezra Klein | August 5, 2010; 4:17 PM ET | Permalink | Comments (9)

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Hidden Washington

I really love these photographs....

By Ezra Klein | August 5, 2010; 4:09 PM ET | Permalink | Comments (1)

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You already knew that FDR vanquished Nazis and Fascists

But did you know he also stopped Sharia law from infiltrating the American financial sector? True story....

By Ezra Klein | August 5, 2010; 2:22 PM ET | Permalink | Comments (4)

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What is the point on the Senate?

Sigh. “I made a case last night to about ten freshman senators, you know, you want to turn this into a unicameral body? What’s the point of having a Senate? If the vote margins are the same as in...

By Ezra Klein | August 5, 2010; 2:10 PM ET | Permalink | Comments (18)
Categories: Senate
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The Bush tax cuts and small business

Harry Reid says the Senate will consider the Bush tax cuts in September. What will they do about them? Hard to say. The options seem to be to extend most of them or all of them. Few seem to be...

By Ezra Klein | August 5, 2010; 1:40 PM ET | Permalink | Comments (16)

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Lunch break

How monkeys run their economies:...

By Ezra Klein | August 5, 2010; 12:30 PM ET | Permalink | Comments (7)

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The conservative effort to undermine health-care reform

I'm really not sure why conservatives are so excited that an electorate primarily made of Republican primary voters passed an anti-individual mandate ballot initiative in Missouri. I don't even understand why conservatives would be excited if it passed during a...

By Ezra Klein | August 5, 2010; 12:05 PM ET | Permalink | Comments (56)
Categories: Health Reform
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Funny numbers

George Voinovich: Over the past two years, our nation borrowed $123 billion to pay for unemployment insurance extensions, our national debt increased by almost $4 trillion, and Democrats passed a $2 trillion health care bill and a stimulus bill now...

By Ezra Klein | August 5, 2010; 11:19 AM ET | Permalink | Comments (7)

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Who overturned Prop 8?

So, about that liberal activist judge who overturned Prop 8 yesterday: This “liberal San Francisco judge” was recommended by Ed Meese, appointed by Ronald Reagan, and opposed by Alan Cranston, Nancy Pelosi, Edward Kennedy, and the leading gay activist groups....

By Ezra Klein | August 5, 2010; 10:35 AM ET | Permalink | Comments (14)

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By their votes, you shall know them

Reihan Salam's effort to explain how you can know congressional Republicans believe something they don't mention publicly or support legislatively gets at the heart of one of D.C.'s most pernicious illusions: The idea that we should worry about what congresspeople...

By Ezra Klein | August 5, 2010; 9:53 AM ET | Permalink | Comments (17)

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Wonkbook: State aid passes Senate; static kill succeeds; no more secret holds?

It's a day of progress in Washington: The Senate has broken a filibuster of the state budget aid package, setting up the House to come back in session to past the final version. Harry Reid has put legislation ending...

By Ezra Klein | August 5, 2010; 7:57 AM ET | Permalink | Comments (12)
Categories: Wonkbook
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Reinhart: "This is not something that policymakers can undo quickly."

In their book “This Time is Different,” Carmen Reinhart and Kenneth Rogoff construct the richest and most detailed history of financial crises that anyone has developed. Their data set covers 66 countries, five continents and eight centuries, and gives them...

By Ezra Klein | August 4, 2010; 5:57 PM ET | Permalink | Comments (13)
Categories: Interviews
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Against salary freezes

Andrew Samwick is distressed by President Obama's decision to freeze salaries for political appointees: If you freeze salaries, then only the people who don't deserve a raise get the raise they deserve. Everyone else gets less, and the discrepancy is...

By Ezra Klein | August 4, 2010; 4:11 PM ET | Permalink | Comments (9)

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The Republicans' tax cut trap

Visit msnbc.com for breaking news, world news, and news about the economy Let's take just a moment to marvel at the elegant trap Republicans have sprung on the Democrats. If Democrats don't extend the Bush tax cuts, it's the "Democrats'...

By Ezra Klein | August 4, 2010; 3:24 PM ET | Permalink | Comments (22)
Categories: Taxes
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Research Desk counts: How much does the U.S. subsidize clean and dirty energy?

By Dylan Matthews jeirvine asks: I'd love to see some graphics on where all US Gov't subsidies (tax breaks, incentives, direct funding) for energy go -- dirty vs. clean. The Environmental Law Institute did a study (PDF) on this last...

By Dylan Matthews | August 4, 2010; 3:02 PM ET | Permalink | Comments (19)
Categories: Energy
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Spin one for the Gipper, cont'd

Paul Krugman has more on the difference between the 1981 recession and the 2007 financial crisis: The 1981-2 recession was a very different kind of event from the 2007-9 recession: basically, it was a recession deliberately created by the Fed...

By Ezra Klein | August 4, 2010; 1:53 PM ET | Permalink | Comments (2)

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Does international aid win hearts and minds?

Maybe....

By Ezra Klein | August 4, 2010; 1:45 PM ET | Permalink | Comments (0)

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Lunch break

I might've used this space to wish Barack Obama a happy birthday, but then I heard Rush Limbaugh say this: Tomorrow is Obama’s birthday, not that we’ve seen any proof of that … What? We haven’t seen any proof of...

By Ezra Klein | August 4, 2010; 12:35 PM ET | Permalink | Comments (45)

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Why we'll have to get serious about health-care costs in one graph

In Washington, some talk about the health-care problem as if it's simply a Medicare problem. That's not true. It's just that the CBO estimates Medicare's impact on the deficit, and so we get frequent reminders of the threat from Medicare....

By Ezra Klein | August 4, 2010; 12:12 PM ET | Permalink | Comments (12)
Categories: Health Economics , Health Reform
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Research desk is open

Can't follow the action without graphs....

By Ezra Klein | August 4, 2010; 11:47 AM ET | Permalink | Comments (11)

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Spin one for the Gipper

I expect some simplification and spin when political pundits discuss economics, but experts are generally more careful, if only for the sake of their own credibility. So I was surprised to read Dan Mitchell, Cato's tax policy guy, offer...

By Ezra Klein | August 4, 2010; 11:37 AM ET | Permalink | Comments (39)

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Hitchens on cancer

Christopher Hitchens on traveling from the "country of the well across the stark frontier that marks off the land of malady": The new land is quite welcoming in its way. Everybody smiles encouragingly and there appears to be absolutely no...

By Ezra Klein | August 4, 2010; 10:51 AM ET | Permalink | Comments (6)

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Can you have a middle class without middle-class jobs?

From David Autor's paper, "The Polarization of Job Opportunities in the U.S. Labor Market" (pdf): The structure of job opportunities in the United States has sharply polarized over the past two decades, with expanding job opportunities in both high-skill, high-wage...

By Ezra Klein | August 4, 2010; 10:38 AM ET | Permalink | Comments (6)

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What do Republicans believe on state aid?

Yesterday, I asked Reihan Salam to give some evidence for his claim that there is “a broad consensus" among conservatives and "large numbers of Republican lawmakers" that Congress should pass further state and local aid measures. According to Reihan, the...

By Ezra Klein | August 4, 2010; 10:01 AM ET | Permalink | Comments (17)
Categories: Stimulus
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Wonkbook: Dems look to Collins; energy bill delayed; drilling ban may end early; Kagan to be confirmed tomorrow.

Lacking the votes needed to break a filibuster, Harry Reid has given up on passing a bill responding to the oil spill before the August recess; Democrats have now offset the state aid bill with an $11.9 billion cut in...

By Ezra Klein | August 4, 2010; 6:30 AM ET | Permalink | Comments (6)

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Reconciliation

Recap: My working understanding of the Republican economic agenda; double-counting in health care defined; and something you should really read. Elsewhere: 1) Foreign-born doctors are as good as native-born doctors. 2) Twenty years of the American Prospect. 3) Democrats base...

By Ezra Klein | August 3, 2010; 6:30 PM ET | Permalink | Comments (3)

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Business confidence

I've been trying to report out this question of business confidence and what, if anything, is depressing it beyond what the economic fundamentals would predict. It's difficult. For one thing, there's very little hard data on why, exactly, businesses aren't...

By Ezra Klein | August 3, 2010; 5:41 PM ET | Permalink | Comments (24)
Categories: Economy
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How the Bush tax cuts could sabotage tax reform

If you're confused by the discussion over the Bush tax cuts, Derek Thompson has a nice primer. I'm not convinced by his conclusion, though. Thompson comes down on the side of extending the tax cuts while working on comprehensive...

By Ezra Klein | August 3, 2010; 4:10 PM ET | Permalink | Comments (27)
Categories: Taxes
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What's holding small business back?

A lot of people talk about why businesses aren't investing, but the National Federation of Independent Business actually asked them (pdf): Many policymakers misidentify the fundamental bases of small-business problems, leading to promotion of faulty policy. The principal immediate...

By Ezra Klein | August 3, 2010; 3:29 PM ET | Permalink | Comments (8)

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Policy and charity

As yesterday's lunch break hinted, I've been thinking a lot about charity lately. In particular, I want to donate more. But I don't really want to donate to traditional charities. The country needs food banks, of course, but a better...

By Ezra Klein | August 3, 2010; 2:48 PM ET | Permalink | Comments (50)

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State and local relief on the right

According to Reihan Salam, there is "a broad consensus on [state and local relief]: conservatives, including a large number of Republican lawmakers, accept the idea that there should be some help from the federal government. Yet those on the right...

By Ezra Klein | August 3, 2010; 2:18 PM ET | Permalink | Comments (15)

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The Republican economic agenda

I'm always baffled by the reaction some of my commenters have to my interviews with Republicans: The GOP has some power now, and is likely to have a lot more after November. This blog would be terribly incomplete if I...

By Ezra Klein | August 3, 2010; 1:43 PM ET | Permalink | Comments (21)
Categories: 2010 Midterms
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Lunch Break

Jon Stewart on the media's coverage of the wedding of the decade of the century of the millennium: The Daily Show With Jon StewartMon - Thurs 11p / 10cWedding of the Decade of the Century of the Millenniumwww.thedailyshow.comDaily Show Full...

By Ezra Klein | August 3, 2010; 12:43 PM ET | Permalink | Comments (3)

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Research desk investigates: How great is American income mobility?

By Dylan Matthews Rossi1 asks: Just how mobile are people when it comes to coming into or out of a certain annual income bracket? How far up the ladder do the poor typically go and how far down do the...

By Dylan Matthews | August 3, 2010; 12:06 PM ET | Permalink | Comments (14)
Categories: Inequality
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If you read nothing else today

I don't really know what to say about George Packer's masterful report on the modern Senate except that I wish I'd written it. The lines of argument won't be new to readers of this blog, but Packer does a better...

By Ezra Klein | August 3, 2010; 11:08 AM ET | Permalink | Comments (16)
Categories: Senate
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Tom Toles is worth a thousand words

By Ezra Klein | August 3, 2010; 9:56 AM ET | Permalink | Comments (2)

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The virtues of Ryan's roadmap

Kevin Drum took aim at Rep. Paul Ryan's admirers last night, arguing that Ryan's vaunted honesty about spending cuts simply obscures a different sort of vagueness. "His plan merely caps various kinds of spending: there's a cap on Medicare, a...

By Ezra Klein | August 3, 2010; 9:31 AM ET | Permalink | Comments (31)
Categories: Health Reform
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Double counting

During the health-care debate, the administration was often accused of "double counting" the savings from the bill. This accusation was sort of true (the dispute relates to extremely boring, extremely technical questions about the nature of "unified budget accounting"), but...

By Ezra Klein | August 3, 2010; 8:28 AM ET | Permalink | Comments (17)

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Wonkbook: State aid delayed; EPA regs face lawsuit; GOP targets health care funding; oil spill larger than thought

Concern over the deficit can be an oddly capricious affliction, particularly in the United States Senate. On days when the senators are arguing over how many of the Bush tax cuts to extend, the choice is between all of...

By Ezra Klein | August 3, 2010; 6:26 AM ET | Permalink | Comments (2)
Categories: Wonkbook
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Reconciliation

Recap: The Great Stagnation may be worse than the Great Recession; state budget practices aren't responsible for the current crop of state budget woes; and you could pull in some real money by treating hedge funders like everyone else. Elsewhere:...

By Ezra Klein | August 2, 2010; 6:31 PM ET | Permalink | Comments (0)

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Tax cuts and tanks require real money

Ronald Reagan's OMB director David Stockman has been getting some attention for this op-ed flaying conservatives for their fiscal fantasies. The argument isn't really new, but it's always worth laying out clearly. The issue isn't that conservatives don't care about...

By Ezra Klein | August 2, 2010; 5:25 PM ET | Permalink | Comments (17)
Categories: Budget , Taxes
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The six-for-six compromise

"Deficit reduction and short-term job creation are not competing priorities," writes John Irons in this memorandum (pdf) for the Economic Policy Institute. "Job creation is needed today to ensure a strong economy and a solid tax base tomorrow: you can't...

By Ezra Klein | August 2, 2010; 4:51 PM ET | Permalink | Comments (6)
Categories: Budget
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Thank tank: Defense cuts, the gold standard and skills

1) Michael Leachman of the Center for Budget and Policy Priorities argues that the stimulus has created more jobs than recovery.gov tracks. 2) Bruce Katz, Emilia Istrate and Jonathan Rothwell note that rising exports would help metropolitan areas disproportionately. 3)...

By Ezra Klein | August 2, 2010; 4:00 PM ET | Permalink | Comments (2)
Categories: Think Tank
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Volt!

Jon Cohn, in a post about the benefits of rescuing the auto industry, explains how the Chevy Volt works: The Volt is a new kind of vehicle. When you drive a conventional hybrid, such as the Toyota Prius, the...

By Ezra Klein | August 2, 2010; 3:51 PM ET | Permalink | Comments (23)

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Blame the states?

The main argument against state and local aid has been something of a they-made-your-bed take on the matter. "It’s a bad idea to bail out states from making the necessary decisions they need to make to increase and fix...

By Ezra Klein | August 2, 2010; 3:34 PM ET | Permalink | Comments (9)
Categories: Budget
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Research Desk predicts: How much revenue would closing the hedge-fund loophole bring in?

By Dylan Matthews jackjudge4000yahoocom asks: If the carried interest loophole was closed how much revenue would be raised? The "carried interest loophole" refers to a quirk of the tax code that results in lower tax rates for general partners (GPs)...

By Ezra Klein | August 2, 2010; 2:41 PM ET | Permalink | Comments (2)
Categories: Taxes
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