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Rick Hasen worries that the Supreme Court appears ready to strike down, on free speech grounds, a large chunk of the McCain-Feingold campaign finance law--the part that bans corporate funding of election season broadcast ads. Amazingly, Justice Kennedy is not the swing vote on this issue, Hasen notes. He's already come out with Scalia and Thomas against the law. He's a done deal. Roberts and Alito-- they're the swing votes! Yikes. Add them to the previous three and you would have a sure majority of 5 even if Obama had nominated Dahlia Lithwick to fill Souter's seat.
Hasen predicts a near nuclear disaster for the goo-goo campaign finance lobby: SCOTUS will nix the whole decades-long attempt to keep corporate and union money out of campaign ads--in effect declaring that it's OK if for-profit corporations and unions use their unlimited funds to run spots attacking specific candidates.
I'm not so sure.
After all, isn't there a pretty obvious "right" answer in these cases--at least an answer that all concerned civic-minded centrists should approve. It's this: restrict ads funded by for-profit corporations. Allow ads funded by non-profit "ideological" corporations (and regular, unincorporated individuals--even the Wylys).
The original McCain-Feingold bill, remember, banned only for-profits. There was a good reason for drawing that line: It's one thing to stop GM,say, from using the millions in profits it generates as a limited liability corporation** to meddle in electoral politics.*** It's another thing to ban political speech by non-profit groups like Sierra Club and the NRA--organizations whose purpose is to let individual citizens meddle in politics exactly as we should want citizens to meddle in politics.
It was the late, beloved and deeply misguided Sen. Paul Wellstone who broadened the original McCain-Feingold ban to include those non-profit advocacy groups. Wellstone successfully tapped into Congressional incumbents' natural desire to block any potentially damaging ad from any source they don't control. McCain and Feingold both voted against Wellstone's change to their bill. ("If I thought it was constitutional, I would have voted for it," said McCain at the time.) The New York Times ed board commanded that "The Senate must undo Mr. Wellstone's damaging amendment." But the Senate for some reason did not obey. The amendment stood un-undone.
Yet now the Supreme Court can undo it, no? That wouldn't be hard. They'd just have to embrace and apply the so-called "MCFL exception"--named after a small nonprofit corporation, Massachusetts Citizens for Life, that the Court seemingly said could distribute pro-life propaganda without limiting the size of the individual donations it accepted, as long as it didn't take for profit corporate money or union money.
And why isn't that exactly what the Court will hold in the fall when it takes up the issue (after punting on it yesterday)? One answer is that the litigant currently before the Court--a non-profit outfit that made an anti-Hillary movie-- has admitted it actually takes for-profit corporate money. They've put themselves on the wrong side of the for profit/non-profit line (perhaps intentionally). If you buy the idea that Roberts and Alito really don't want to uphold any campaign finance laws, then you'd think they would have teed up a different case if they wanted to draw a profit/nonprofit funding distinction. Roberts and Alito don't want to have to say that, "Hey, McCain Feingold is OK as applied to this anti-Hillary group because of its tainted 'for profit' donations, but ...." Which leads to Hasen's speculation that what they're really going to say is that McCain Feingold isn't OK as applied to anybody--non-profit, for-profit, whatever.
But surely they have other tricks they could pull--tricks that would allow them to not approve applying the McCain-Feingold law to this particular 'tainted' litigant while codifying the "MCFL" rule. Here's one: Declare that the "MCFL exception" applies to outfits that get a proportionately insignificant amount of for-profit money--not merely to outfits that get no for-profit money. Then remand to a lower court for a hearing on how much money this particular anti-Hillary group gets from which sources.
The upshot: Ads funded without any for-profit money or union money would be home free--Wellstone's amendment would be unconstitiutional. As for ads that are funded by for-profit corporations and unions ... well, Justices Roberts and Alito could say, come see us again in a few years.
So decided! Next case. ... Or have I missed something? ...
Update: Prof. Hasen responds--
I think if CJ Roberts and Justice Alito just wanted to expand the MCFL exemption, they likely could have gotten some liberal votes for that, and would not have needed to set the case for briefing on a nuclear-type issue
Hmmm. Are we sure the liberals want to expand the MCFL exemption? That would mean expanding constitutionally protected advocacy by rich people at the expense of regulations limiting their spending and "leveling the playing field." Free speech is a dangerous principle once you let it loose. The whole current structure of campaign finance could come unraveled if massive, effective, and uncontrolled "independent" spending by random citizens becomes commonplace, no? ...
Part of the problem, maybe, is that neither side wants to take the obvious, centrist MCFL route. The legalistic left thinks "money isn't speech" and wants to limit political advocacy by the Wylys and Scaifes of the world. The lawyerly right thinks spending on advocacy by faceless for-profit corporations is as sacred as spending by actual human citizens. ...
P.S.: Hasen notes that the Court asked for more briefs specifically on the "nuclear" issue of whether to declare McCain-Feingold's entire ban on "corporate" election ads unconstitutional on its face. But I'm not sure you can draw a blazing arrow between what issues the judges want briefed and how Roberts and Alito will rule in the crunch next year. Maybe the extra briefing is just a way to suck up to Justice Kennedy, or to delay the case until Souter is gone, perhaps in the hope that Sotomayor will be more flexible (or less persuasive). ... Update: Alert reader J adds:
Could it be that the request for briefing on the nuclear issue is in part (at least) directed to forcing the two sides to confront the question of whether they have a backup position that might be more centrist? The court knows that everyone and his brother will file as amici in this round. Is it saying, look, you are looking at the possible destruction of everything, and you know that we are crazy enough, or sufficiently imbued with first amendment spirit, to do that. Are you sure you don't want to give us cover to work out a centrist, practical, solution that will put this issue to bed within shouting distance of reason?
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**--OK, bad example.
***--Similarly, unions are also given a special privilege by the state--the right to act as the exclusive bargaining agent for all employees--that allows them to amass cash. With special privileges come special restrictions, you could argue. If union members formed a non-profit on their own, it would be a different story. 8:08 P.M.
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Monday, June 29, 2009
Michael Kinsley:
Here is a handy-dandy way to determine whether the failure to order some exam or treatment constitutes rationing: If the patient were the president, would he get it? If he'd get it and you wouldn't, it's rationing.
Works for me. ... 1:26 P.M.
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When in S.F. ... : Willie Brown's column is almost Caen-y! But doesn't this recent party he attended (at the home of a former Secretary of State) seem a) a bit decadent and b) embarrassing?
I went to an unbelievable dinner party at Charlotte and George Shultz's penthouse Monday night for retired Army Gen. Eric Shinseki, the new secretary of veterans affairs.
The party was a Stanlee Gatti tour de force, complete with fatigue-wearing servers, camouflage table cloths, extras dressed up as snipers and a full Marine color guard and band.
It was like being in Afghanistan.
All this for about a dozen guests. Gov. Arnold Schwarzenegger was there with his wife, Maria Shriver. Gavin Newsom was there with Jennifer, and boy is she showing.
I was seated next to Arnold, and he seemed to be holding up pretty well, considering the nightmare going on up in Sacramento.
The dessert: a chocolate replica of the Joint Chiefs of Staff seal, surrounded with vanilla ice cream and the Golden Gate Bridge in chocolate on each side.
I think it's the "extras dressed up as snipers" that does it. ... [via Lucianne] 1:22 P.M.
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Fire, Ready, Aim: FIAT/Chrysler CEO Sergio Marchionne:
"This weekend we'll be choosing which Chrysler [factory] we'll be using to produce the Fiat 500 aimed at the US market ... We shall probably produce the full Alfa Romeo range. ... We shall probably also be making the so-called crossover, the new 69, when the Alfa flagship comes out, but on a platform shared with Chrysler. The whole range will be re-designed."
He does seem decisive (contrast with GM management style, which Ross Perot famously described as "Ready, Aim, Aim, Aim." I still say the whole thing flops. ... TTAC's commenters are also less than fully supportive. ... 1:20 P.M.
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So if one of these promising new cancer treatments winds up working 25% of the time, but costs $150,000, will Peter Orszag give to you? ... 12:14 A.M.
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Mark Krikorian on why Chuck Schumer's new get-tough rhetoric on immigration is a fraud:
Schumer also called for a biometric worker verification system, though this is also little more than a marketing gimmick. I'm actually not averse to it, but it's a pie-in-the-sky right now. Instead, to prove seriousness about enforcement, the government needs to implement the actually existing tools right now and upgrade them as time goes on. E-Verify, for instance, would be better with biometric identifiers. But it's darn good now, especially when combined with the Social Security Number Verification Service (SSNVS) and no-match letters, and they're working to integrate more photos (which are, after all, a form of biometric identifier) into the system too, by incorporating passport photos and getting states to provide their digitized driver's license photos. What we need is for Congress to phase in E-Verify for all employers now, something that will take several years to roll out, assuming judges even allow it to go forward. But this administration won't even implement the rule requiring federal contractors to use E-Verify, and the House has rejected a number of Republican amendments to do just that (and also rejected an E-Verify mandate for recipients of TARP funds). So Schumer's got a long way to go before he can overcome the public suspicion that "their government is not serious about combating illegal immigration." [E.A]
The obvious Schumer scenario: Congress decrees an amnesty plus fancy future employment-verification technologies. The amnesty happens, the technologies fail or are blocked. ... Even if you actually think both elements are necessary for immigration reform, wouldn't it make sense to first legislate the worker-verification system, then see if it gets past the Chamber of Commerce's and the ACLU's lawsuits, then see if it works, then (we're into Cory Booker's second term here) talk about the amnesty? ... 12:09 A.M.
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Quote of last week: "What color do we turn our icons now?" Ana Marie Cox, 6/25 ... Hard to believe the new, Twitter-addled Time and Newsweek both missed that one. [via Pareene] 12:08 A.M.
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Edwards sex tape. So disappointing. Just him and a mirror again. ... P.S.: But Rush & Molloy bury the lede--Obama's alleged promise to make Edwards Attorney General. ... Given what had already come out about Edwards and Rielle Hunter even before the Iowa caucuses, this may be one of those promises Obama knew he wouldn't have to keep. ... 12:07 A.M.
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Back when kausfiles began, in the spring of 1999, we didn't have any of this fancy blogging software or RSS/twitter#whathaveyou that kids have today.** No sir. We had to hew HTML code out of wood, after walking through the snow for ten miles.
The first entry was on June 26. I posted it from my mother's basement. (But I had been dressed for hours. I swear.) It was a conventional piece,*** with a set-up lede, some worker-paragraphs, a kicker. A few weeks later I ran into Walter Olson, of Overlawyered. He said, "I really admire your site, Mickey. Everyone else is out there desperately trying to put up fresh daily content to attract hits. But you let your posts just sit there. It's dignified--almost stately." I'm paraphrasing, but you get the point. I realized maybe I should desperately try to put up fresh daily content to attract hits. So I added "just-written, linked commentary on that day's news"--what I didn't know was a "blog." In 2002, I moved it to Slate, in exchange for the equivalent of Nikki Finke's toenail.
In any case, the gala kf 10th Anniversary, now underway, seems a good time to force myself to assess the highs and lows so far:
Stupidest thing I said: No contest. At least I hope no contest.
Media coverage of the 9/11 attack often emphasizes that it will be a "long time before America gets back to normal," etc. The opposite is likely to be closer to the truth -- we'll get back to normal all too quickly, ...I suspect the story will be off the evening news by Thanksgiving. [9/12/2001]
Feature I shouldn't have let die: Yent-a-matic. Heather Mills and Ron Burkle was a good idea! Still could happen. ...
People I should maybe apologize to: Gary Condit. He was behaving awfully squirrelly. And I was only speculating! But that got pretty intense. I was more caught up in the possibility of his guilt than was justified. (After a long investigation, the police arrested someone else, clearing him.) I remember I once questioned--maybe on a conference call--why Chandra Levy would go jogging if she was about to leave town. A few days later, when I was mourning the sudden death of my colleague Scott Shuger, I realized I'd forgotten to listen to my phone messages. There was a days-old one from Scott, calmly explaining that going for a jog is exactly the sort of thing you do when you're about to leave town. Right. I'd been overexcited. Thank you, Scott.
People who should maybe apologize to me: Matt Yglesias! When John Edwards denied the rumor that he'd had an affair with Rielle Hunter, and called it "made up," I argued this was a poor strategy--even an innocent pol shouldn't go out of his way to challenge the integrity of the press organizations that are after him. It might anger them and cause them to redouble their efforts and actually nail him, or at least accuse him further, with attendant PR hassle. Yglesias argued that I was assuming guilt, and anyway:
No doubt by now we've had all the legitimate news organizations in the country looking into it and it seems that . . . nobody can come up with any evidence.
He then went on to giggle about goat-blowing. ... In the event, of course, the press organizations that were after Edwards (e.g., National Enquirer) redoubled their efforts and nailed him. ... P.S.: I don't think I assumed Edwards' guilt, but I admit it was hard not to because I knew he was guilty. It was the worst-kept secret on the Eastern Seaboard. You'd write about it and then you'd get off-the-record you-can't-use-this calls from credible people confirming it. I suspect that if I were a trained reporter, or just a better reporter, I could have figured out a way to explain to readers (including Yglesias) why I was on Edwards' case without compromising those confidences. I was actually trying to write just that piece when the Enquirer caught Edwards visiting Hunter at the Beverly Hilton.
Best bit of writing: The best-written piece I've published after starting kausfiles was a fake reminiscence of JFK Jr. My friend Ellen Ladowsky and I had the idea. I wrote a draft and sent it to her, but didn't hear anything. Finally I reached her by phone at her mother's house in Canada. She was having some sort of intense discussion and didn't have time to talk. "No, it should be like this," she said, almost annoyed, and hurriedly dictated four or five paragraphs. I had the good sense not to change a word. I suppose if I were Maureen Dowd I would get in trouble for that.****
Best idea: A Fed for payroll tax cuts during recessions:
[E]mpower some independent, non-partisan body to temporarily cut payroll taxes, by one or two percentage points, just as we empower the Federal Reserve Board to cut interest rates.
We could have used that this winter, no? Spending may eventually deliver more punch, but tax cuts that don't even have to go through Congress would undoubtedly be much quicker.***** This must be an old idea. But it's still a good idea. And the great thing about the Web is you don't have to check! You just write "This must be an old idea." ...
Best idea I dropped: Open Source Health Studies. Let everyone with a computer and a bit of paranoia mine a big database to see what correlates with, say, Alzheimer's and what doesn't. I even got an email from someone who seemed to know the subject who said it was possible. It's in a folder. I need to dig it out. ...
Worst case of being spun: Watching from the press area, I thought Gore cleaned Bush's clock in their first 2000 debate. Then I went to the spin room where Stuart Stevens immediately mentioned that Gore hadn't been to Texas with James Lee Witt, as he'd boasted. Didn't that play into the festering press meme that Gore was an insecure embellisher? It sure did. I wrote a goading piece saying this was a test of whether reporters could trash a Dem as they had said they would. (It was a test they passed.)
Since a butterfly flapping its wings could have tipped the 2000 election the other way, and since Gore would have been a better president than Bush, I've been feeling guilty about that piece. It's true that a) there were other reasons Gore "lost" the debate among many viewers--he grunted and sighed obnoxiously, something I couldn't hear in the press area.***** And b) every Dem political pro I've talked with thinks it was inexcusable-- and telling--that Gore boasted about Witt when he knew and was surely told that any new little boast would kill him. Still ... flap, flap ....
Greatest Hit that seems questionable in retrospect: The "Don't Rush Me" Series before the 2000 election. It was fun to run through all the reasons why I was an undecided voter, but in retrospect I shouldn't have been. I got snookered by Tucker Carlson's "If you're going to fuck me you'll have to kiss me first" anecdote into thinking Bush was going to be a surprisingly charming bipartisan compromiser and not a stubborn misguided cuss. Yes, Gore would have been a disaster in his own way, but he wouldn't have invaded Iraq. [Would he have passed health care?--ed No Would he have destroyed the GOP and salted the ground the way Bush has?-ed No Are we in such a bad place now?--ed All good points!]
Thing I'm proudest of: Being part of the angry, You-Tubin' mob that helped stop Bush and McCain's misguided and irreversible illegal immigrant legalization bill. Sorry! ...
That said, these are kf's Greatest Hits, I think:
The Case Against Editors On the Web they can help, but not enough. Don't curate me bro!
Let's Not Save Social Security A means test-for-health care swap looks better every day.
50-50 Forever In which I imagine I've discovered a theory about voting that actually dates from 1929.
Stating the Obvious After 9/11 Norman Podhoretz argued "Israel Isn't the Issue." Of course it is--in large part. And 9/11 changed our stakes in that Mideast conflict. (I wonder if David Greenberg would stand by his criticism today now that Obama has rejected the Podhoretz thesis.)
Gore vs. the Mysterious Forces A Kinsley-approved case against Shrumian populism.
No New Jaguars: The Fence and the Kitchen Sink My attempt at writing a column the way Ann Coulter would--forget the other hand, bombs away. It was an improvement.
I Can't Help Hating Chris Bangle About the crack BS artist who's done more to destroy our urban visual environment than anyone since Philip Johnson. Bangle's finally out of power, but every time I see a BMW--which is a lot around here--I hate him again.
Does Welfare Cause Terrorism Ethnic antagonism + welfare = oppositional culture.
Everyone Was Wrong About McCain Feingold Campaign finance reform isn't what we thought it was.
Help, I'm a Snob Like Obama! And Bob Wright. ... Mayhill Fowler opened up a can of worms! I hope I get points for failing to come up with any sort of satisfying conclusion.
Bold Decisive Disasters The scales fell from my eyes when I realized the suspect methods Bush used to push "comprehensive immigration reform" were the same suspect methods he had used to push the Iraq War.****** A little late, I realize.
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**-- And Bing! We didn't have Bing.
***--The piece actually ran in the NYT, which graciously let me post it on my site 24 hours later. I wonder if they still do that.
****--The piece was originally published under the byline J.William Medley, a fictional Washington pundit I borrowed from his creator, Jefferson Morley.
*****--Who needs editors when you have enemies!
Alert Reader noticed that I'd said "spending cuts" when I meant "spending."
Media Matters says an
immediate post-debate poll showed Gore narrowly "won" the first debate among viewers (as I thought he had). The same survey suggested that Bush gained more "favorability" ground. I've changed the wording to fudge that issue (adding "many"). The point is that Gore's sighing and grimacing turned off
lots of people--including my own mother (no Bush fan). The sighs and grimaces were inevitably replayed over the succeeding days, damaging Gore further.
******--Also when I read
this book.
2:54 P.M.
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The U.A.W., now a major GM shareholder, has delivered its final punishment to those auto workers who dared move to Spring Hill, Tennessee and show up the rest of the union by building reliable car without Wagner-style work rules. GM's new small car will be made in Michigan, and the Spring Hill plant will close. .... P.S.: Nikke Finke has a better chance of making money producing this car than GM does. ... 3:52 P.M.
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South Carolina Lt. Gov. Andre Bauer, who would succeed Mark Sanford should Sanford resign, needs to update his web site! His blog still has Sanford "hiking along the Appalachian Trail" (though Bauer is waiting for "a more definitive idea of what part of the Trail he was on"). ... P.S.: With his campaign to allow "I Believe" license plates, Bauer seems ripe for liberal mockery. And even papers that have demanded Sanford's resignation don't seem to have much confidence in him. The Spartanburg Herald Journal, after calling for Sanford to step down, writes:
“South Carolinians cannot be sure that Lt. Gov. Andre Bauer has the capability to lead the state in this recession. They can only hope that he will be up to the task.“
They can pray! ... Update:
"He’s an attractive, conservative Republican, single, straight — and he has a lots of attractive women that want to be his friend on his public Facebook and MySpace page," said [Bauer strategist Chris] LaCivita. "What’s their complaint? I’ll tell you — they're jealous."
1:46 P.M.
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Wagner Act Unionism is bringing its benefits to the Bay Area, where the BART transit system may go on strike despite having negotiated what seem to be generous wages and benefits:
A top-scale station agent and top-scale train operator each make $30.01 per hour, $62,860 a year, in base pay. The transit system also pays 100 percent of the so-called employee contribution toward pensions — an amount equivalent to 7 percent of a salary — though many other California public agencies require workers to pick up some or all of that contribution toward their state pensions.
Overall, BART employees - including managers and hourly workers - get average total annual pay of $71,633, including overtime, and BART picks up an average of $48,000 a year for each worker's benefits, the transit system said.
Workers contribute $81.90 a month toward medical insurance.
But for all that the taxpayers get a finely-wrought mesh of work rules:
Antiquated work rules hurt BART finances by ramping up overtime, BART officials said.
They point to rules requiring that two workers remove seat covers and backing for cleaning. A utility worker unsnaps the cushion. A journeyman mechanic is called in to remove two screws for the seat backing.
Among cleaning crews, a worker in one job classification cleans inside stations and another worker in another classification cleans outside the roof line of stations.
This isn't an example from the 1950s. It's an example from this week. Why would anyone fail to support a "card check" reform designed to encourage the spread of these practices? They worked in Detroit, right?...
Update: Here is a searchable database of BART salaries. ... It's the #1 most-viewed page in the Contra Costa Times at the moment, so it might be slow to load. ... 2:02 P.M.
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First hit, best hit. ... 8:36 P.M.
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All Going According to Plan? According to The Hill, Democrats are worried "that they will not be able to accomplish the entire agenda leaders set for 2009." And "comprehensive immigration reform"--i.e. legalization of illegals--is so far down the list it barely gets mentioned as one of the agenda items they are worried will fall off:
Sen. Charles Schumer (N.Y.), the vice chairman of the Senate Democratic Conference, has pushed hard for the Senate to take up immigration this year. But White House officials have suggested that the issue will wait for a while.
“We know the votes aren’t there right now,” White House press secretary Robert Gibbs told reporters on Friday.
The other far reaching and calamitous Dem initiative--pro-union labor law revision, including "card check" and mandatory arbitration--isn't mentioned by The Hill at all, which actually seems vaguely troubling for opponents. Publicity is not the friend of labor unions in this fight, after all. If 60 Senators agree on a "compromise" to placate labor, it will be a compromise they will probably want to keep hidden and then push through quickly. ... 9:15 P.M.
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Josh Marshall's TPM has been presciently keeping the undernews fires burning on the Sanford scandal, even when the mainstream media (MSM) was buying the story that the governor had been hiking the Appalachian trail. But reading over TPM's post "Sanford Press Conference Leaves Unanswered Questions," I was struck by one thing: How uninteresting all the remaining questions are.** "[W]ould [Sanford] have stuck to the Appalachian story" if he could have gotten away with it? Duh! "[D]id he voluntarily tell the State's reporter that he had been in Argentina" or did she look at his luggage tags? Did he see his paramour on earlier taxpayer-funded junkets to Latin America? Other analysts wonder if he used taxpayer-funded gas to drive to the airport. Not sure anybody cares.
We have Faster News and Faster Politics and Faster Scandal. It seems likely that in the course of about 48 intriguing hours those who follow the news have basically learned everything important they need to know about the Sanford mess. He was in Buenos Aires. He cheated on his wife. He really seems to have been in love with this Argentinian. He's out of the 2012 presidential race. Things that ten years ago would have dribbled and drabbed out over the course of days or weeks now hit the Web within minutes. What's left?
Even the story about how scandals happen faster these days has already been done--by TPM, about 29 minutes ago.
There are some obvious implications to Faster Scandals. For one thing, they lead to Faster Comebacks. (Though that won't happen if, like John Edwards, you successfully prolong the suspense, leaving key details--like paternity--hanging for months and even years.) But there are also unanswered questions! Most importantly, what does Faster Scandal mean to Jerry Skurnik's "second electorate"--the one that doesn't follow the news and won't find out about the Sanford scandal until either a) they see it briefly on the nightly news or the front page of their MSM paper tomorrow, or b) Sanford runs for national office years from now, if he runs, in which case a significant segment of voters may suddenly discover that he's an adulterer (the way they discovered that Giuliani was an adulterer at an absurdly late date, namely the GOP primaries of 2008).
In general, you'd think Faster Scandal would mean diminished scandal. The rule of thumb for disaster spin has always been to get the whole story out fast--and now it typically gets out fast, whether the pol at the center of the scandal wants it to or not. A weeks-long story is now a one-day shotgun blast. (Edwards may be an exception in part because reporters have been reluctant to cause more pain to his wife and haven't bothered to smoke out all the key facts.) Back when the editor of the LA Times had a motto of "Do It Once, Do It Long, and Do It Right," it was a scandal-killer, in part because it avoided the extended period of uncertainty in which the media's tom toms of doom are beating and wavering sources can be panicked into coming forward. Now the technology of news has conspired to make the LAT's misguided motto the normal course of events.
But it's also possible that by blunting the initial impact of scandal's like Sanford's--and restricting it largely to Skurnik's first, informed electorate--the increasing speed of scandal means that when the second uninformed electorate finally does learn about it--say, during Sanford's 2016 presidential run--the damage will be all the greater. The news will seem fresher to more of them, because it didn't have sufficient impact back in 2009 to have been processed by everyone. ...
**--Yes, there is still the issue of Maria, who she is, etc. Photos tk. But even that is less interesting now, with so much of the story already out.
P.S.--Was it really about the sex, governor? Do you know anyone who's been to Buenos Aires recently and not wanted to stay there? I know four or five people who returned to California's alleged paradise only reluctantly. ... 5:07 P.M.
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From Nico Pitney's blog yesterday:
5:20 PM ET -- A word about the past two days. In ordinary times, the violence in the streets on Sunday and Monday would have been shocking. But compared to Saturday's massive outpouring, the turnout of demonstrators has been significantly smaller. There is a good reason for it.
Over the past week, the reformist rallies that have succeeded were those scheduled days in advance, with turnout aided by massive word-of-mouth promotion. Today's mourning rally for Neda, on the other hand, was announced only this morning on Karroubi's social networking sites. In the midst of a near-complete media and technological blackout, these large demonstrations need time to develop. [E.A.]
I guess Twitter and Facebook are not enough. ... 12:04 A.M.
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Aslan v. Dickey, Part II:
Reza Aslan on MSNBC yesterday:
"First of all, Ahmadinejad doesn`t even have the national security clearance to even look at Iran`s nuclear portfolio, let alone make any decisions about it. The president doesn`t have national security briefings in that regard."
Chris Dickey in his recent Newsweek piece (which Aslan praised as "brilliant"):
According to a European intelligence source, early in Ahmadinejad's first term, the man leading the country's nuclear negotiations presented several options about how and how fast Iran's nuclear program should proceed. Ahmadinejad said there was only one option: full-scale industrial production. Khamenei's response: Yes, that's what we will do.
So which is it? ... 12:10 A.M.
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'If Nikki Finke is worth $14 M, then I'm worth ... ': Even The Wrap's Sharon Waxman seems almost happy that DeadlineHollywoodDaily.com blogger Nikki Finke has had a big payday. Green shoots! It's lucky Finke is not a cantankerous person. ... Actually, their interview is fabulously tense and confrontational. ...
P.S. Gawker's Gabriel Snyder is skeptical of the $14 million figure reported by Waxman's site. ...
P.P.S.: I'm more interested in the indirect Rattner/Penske connection revealed in an earlier Gawker post on Finke's deal. It seems Obama auto czarito Steve Rattner's firm put money into a firm run by Finke's new owner, Jay Penske, the son of Detroit auto entrepreneur Roger Penske:
[Jay] Penske's Mail.com Media Corporation took a $35 million investment from Steve Rattner's Quadrangle Group in September; but we hear he's been having trouble finding properties to buy.
Hmm. A few months later Rattner helped restructure/dismantle General Motors, and Jay's father Roger wound up buying its Saturn brand. All innocent I'm sure! And Roger Penske has a record of business success that GM (and Rattner) can only envy. ... 11:23 P.M.
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The Truth About Cars on why that J.D. Power and Associates "Initial Quality" survey is not worth paying that much attention to. ... 11:45 P.M.
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Atlantic's Matthew Cooper may think that "affirmative action in its myriad forms is here to stay," but Ward Connerly and the Arizona legislature seem to have other ideas. The legislature has put an anti-preference initiative on next year's ballot. ... 4:06 P.M.
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Like CNN, Twitter seems like a pretty joyless place--but like CNN used to be, it's good in a crisis. ("CNN's Shocking Suck-Up to Iran's Fascists"? Marcus Brauchli: Get Howie Kurtz on the story stat! Oh wait). ... Even good writers turn into bad writers on Twitter. But after following the #iranelection feed (and Sullivan and Pitney) until bleary, I find it hard to have a thought much longer than seven score characters.
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Hillary Was So Well-Behaved Until Now: Sid Blumenthal to State? He may know things [raised eybrow] about Ahmadinejad that you don't .... But if I were Obama I might think twice. ... 10:37 P.M.
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Reza Aslan praises as "absolutely brilliant" a Chris Dickey Khamenei profile that seems to conclude "Ahmadinejad would have won anyway" (notwithstanding "indications of fraud"). Yet Aslan has claimed the election "was stolen by Ahmadinejad’s supporters," specifically the Revolutionary Guard, in what amounted to a "military coup." Which is it? ...10:38 P.M.
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NYT buries story that Sonia Sotomayor pushed for more very-low-income units in Harlem and Bronx housing developments--deeply misguided when the goal is to recreate a class mix and end concentration of poverty. She's also exercised by affirmative action contracting numbers. "'Extreme partisan' on questions of class and ethnicity." Yikes. ... Are conservatives banking too much on her being such a b----- that she won't convince other justices? ... 11:09 P.M.
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"Don't believe what you've heard about a GOP in disarray." The Republicans have
history on their side. There are only a handful of times in our nation's past when the party that won the White House hasn't lost big the following midterm election. That would spell disaster for President Obama's agenda. [E.A.]
Who said that? The Democratic Senatorial Campaign Committee, in a fundraising email I just got. It will come as news to the GOPs. ... 11:10 P.M.
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If John Edwards were alive today ... : The "New GM" tries to slough off product liability claims. ... 11:14 P.M.
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Super-filtered kaus feed! Meanwhile, my own actual twitter feed is such a fire-hose-like stream of apercus that they can only be highlighted here. The highlights: ... OK, there are no highlights. ... Except maybe the Mr. Bubble item which has not been lawyered (and which was stolen from a friend). ... 11:22 P.M.
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Steve Clemons appears to be urging a non-Gandhian approach on the Iraqi opposition. ... 4:06 P.M.
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Psst! Tsi-ay Inda-Kay Orking-Way: What if they came out with a study showing that No Child Left Behind is working--raising test scores without hurting high- or low-achievers--and nobody paid attention? (Except Education Week). ... 4:05 P.M.
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New Chrysler owner FIAT tries its hand at viral advertising. ... [Thanks to reader J.] 4:04 P.M.
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Stimulus Bill Race Quotas? Did you know** that CalTrans, the huge state agency that spends billions in federal highway construction funds, "sets a quota of having 6.75 percent of contracts go to women or members of [a] targeted group--African American, Asian-Pacific American, and Native America, but not Latinos or other groups." Not a "goal"--a quota. They are being sued. But why is a lawsuit even required? Stimulus money appears to be involved. And aren't "quotas" are what every poll-tested politician says he or she is against? Don't you think if the GOPs (or anyone) made a big stink about the stimulus bill's race quotas, Obama would back off? ... Plus it's another bone he could toss to Latinos! ... P.S.: If "quotas" have always tested badly in polls, the words "affirmative action" has often tested much better. But not in the recent Quinnipiac poll, which found that
American voters say 55 - 36 percent that affirmative action should be abolished
Backfill: Jennifer Rubin explains how explicit race quotas in contracting survived the Supreme Court's 1995 Adarand decision, which many people (me too) thought had killed the practice. "Strict scrutiny" isn't what it used to be. ... No doubt Justice Sotomayor will clean up this mess.
**--You wouldn't know if you relied on the L.A. Times, which apparently hasn't covered the CalTrans quota controversy (though its competitors have). ... 1:40 A.M.
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Why was Pennsylvania relatively unscathed by foreclosures in 2008 while neighboring Ohio was hammered? A friend at a conference I recently attended pointed out the contrast. I don't know the answer, but it might be instructive. ... Update: Thanks to Tom Maguire, who forwards a newspaper article and a summary of three Fed studies on the topic. Regulatory differences are suspected. ... 1:54 A.M.
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Los Angeles Democrats have succeeded in using the state's fiscal crisis to recreate welfare, some thirteen years after the hated federal AFDC entitlement was abolished. The local Dem-controlled Board of Supervisors is proposing to pay mothers for "caring for their own children"--which was the original idea of the welfare program when it was inserted into the New Deal's cash-granting structure in 1935. It seemed to make sense--caring for children is a type of work, after all. Except that subsidizing non-working parenthood--especially single motherhood--turned out to be a recipe for epic social disaster (something that was predicted by not a few dissenting antipoverty activists back in FDR's day). In 1996, Congress finally decided the better policy was to require mothers receiving welfare to work, outside the home, even if that was more expensive than just mailing them checks. At the time, the favored liberal Democratic battle cry was a demand for more day care. But now the Dem Board of Supervisors' proposes to cut the day care and just mail out the checks again, at least to all mothers with two children under age 6. (Message: Have a second kid and you don't have to go to work!).
Doesn't Obama's HHS Department have some say in this? Does he really want to resume subsidizing the culture of dependent single motherhood? ... P.S.: If he plays his cards right he could come out for both welfare and quotas in the same week, and give the GOPs a fair shot. ... [via Drudge] 2:07 A.M.
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WaPo media critic Howard "I'm A Star--The Rules Don't Apply to Me" Kurtz, who failed to disclose that he is paid by CNN when he defended CNN in an online chat this week, promises to disclose in the future:
"That was an oversight and won’t be repeated."
We've heard that tune before! ... P.S.: My beef with Kurtz isn't so much that he has a giant crippling conflict of interest (one that would never be tolerated for a Post reporter writing about, say, GM). It's that he has a giant crippling conflict of interest while he runs around chastising other journalists for minor conflicts of interest. Franklin Foer called him an "East German figure skating judge." He once tried to zing me for an Amazon Associates payment of $1.92 (which I'd overzealously disclosed). ... P.P.S.: The Post's Omblogger Andy Alexander produces a laboriously crafted corporate PR-style paragraph defending his employer--
An archival examination of his writings for The Post shows that when CNN has received a significant mention in his columns or stories, they typically end with this disclosure: "Howard Kurtz hosts's CNN's weekly media program, ‘Reliable Sources.'" [Weasel-word emphasis added.]
a) BS; b) What about stories trashing CNN's competitors (without 'significantly' mentioning CNN)? c) This isn't the sort of conflict--getting a paycheck from one of the companies you are covering--that disclosure is held to cure, according to the normal rules of journalism. ...
Update: Bill Wyman argues--and he has a good example--that what Kurtz doesn't write about matters just as much. ... 2:36 A.M.
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Imagine how cool President McCain would be in the Iran crisis. ... Would he go on TV to declare "we are all Moussavists now," or suspend all government activities while he parachuted into Tehran? ... 3:08 A.M.
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At Least He** Had a Lede to Bury: John Edwards thinks he can come back. And somehow in theoretically humble disgrace comes off as smugger and phonier than ever! (Sample: "The two things I'm on the planet for now are to take care of the people I love and to take care of people who cannot take care of themselves.") ...
He thinks "every day" about what form his future role in activism or public life could take, but "right now, a lot of that is unanswerable." ... [snip]
"If I can help the most by working quietly, that's what I'll do. If as time goes by I can be more helpful with a public role, that's what I will do."
WaPo reporter Alec MacGillis pathetically agreed in advance not to talk about the things Edwards didn't want to talk about (like the second tranche of now-festering lies he told in the course of his Nightline "confession"). MacGillis also asserts, as fact, that Edwards promoted health-care reform "more aggressively than anyone on the presidential campaign trail." True? ...
But MacGillis also buries a solid lede: The last web page of his piece features an impressive, reported survey of broken Edwards promises to various actual impoverished Americans--scholarship programs cancelled, Katrina foreclosure cases unaided--complete with victim quotes. ("I just thought he was trying to cover his tracks while he was a candidate. ... It was probably all for show in the end." ).
Who was the editor who decided to call this piece "Hope from a Humbler Perch" instead of, say, "In Defeat, Edwards Left String of Broken Promises"?
Note to Gawker: No, he can't have a Slate Rehab column. Sorry. We're saving the slot for Rattner. ...
**Correction: Reporter MacGillis is a he, not a she. [Thanks to reader B.].. 10:24 P.M.
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Howard Gleckman of the Tax Policy Center reports that Sen. Baucus
is floating the following trial balloon: Congress would fund fund part of health reform with a cap on the tax exclusion of employer-sponsored health insurance but only at a level "significantly above" the cost of the standard plan offered to federal employees. The measure would also exclude policies bargained under current union contracts. ... [E.A.]
Why exclude policies negotiated by unions but not policies negotiated by individuals? Politics, I assume. Unions wouldn't stand for anything else. Fine. But here's the thing--the provision appears to be more than a simple "grandfather" clause that protects current union contracts. A kf source says that the new tax will not take effect until 2013. Does this mean that labor contracts agreed on between now and that date would also be protected? If so, Baucus has just given a big tax incentive for workers--perhaps encouraged by labor signature collectors under a "card check" bill--to form unions and bargain for lavish health benefits that will then be exempted from his tax on lavish benefits. Join a union, get a tax break! (A break the rest of us would have to pay for). ... If Dems start lavishing IRS advantages on union members, maybe organized labor won't even need the "card check" bill to reverse its declining membership numbers. ... 9:53 P.M.
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Mitosis in the Faster Electorate: Conor Friedersdorf notices that the fast twitter-driven news out of Iran has divided his fellow citizens and friends into two groups: 1) Those who keep up to the second with what is happening and how the U.S. should react; and 2) Those who take the weekend off and only know the vaguest details (i.e. " that Ahmadinejad won"). I'd say that Friedersdorf has stumbled upon Jerry Skurnik's "Theory of the Two Electorates"--except it's a peculiarly accelerated version of the Skurnik theory, because Friedersdorf's two groups are both made up of people who would normally be part of the better informed of Skurnik's two electorates:
And those out of the know? They aren't any longer just grandmothers, the apolitical, and the middle manager in Scranton who gets all his news at 11 o'clock after the game. Now people who watch The Daily Show, subscribe to The New Yorker, and read the CNN subtitles as they run on the 24 Hour Fitness treadmill possess radically less information than a self-selecting group of their fellow citizens, granting that they mostly catch up on any given piece of information in a matter of days.
Will this make a difference, Friedersdorf asks?
Are we approaching a point where political information is processed so fast that an event happens, information elites weigh in to shape the discourse surrounding it, the conventional wisdom is communicated to Congress, and elected leaders formulate reactions based on public opinion... all before most of even the formerly plugged in members of the public ever learn what on earth is going on, or have a chance to form an opinion?
I could see Congress, spooked by twitter, overreacting in this fashion--if, say, a draft of Senator Baucus' health care plan comes out that displeases the left, which reacts by shutting down various switchboards before the David Broders of the world can even get to their typewriters keyboards. ... It's hard to believe it will have an effect on official U.S. Iran policy.** (Friedersdorf agrees.)
Of course, to the extent it does empower Friedersdorf's first group, including the fastest bloggers, it would empower Andrew Sullivan-- which (as Obama has learned) is always a dangerous thing. ...
**--That doesn't mean it hasn't had a big effect on the events in Iran itself--the events that the U.S. government must react to--or on the unofficial reaction of American activists to those events. ... 8:53 P.M.
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Alert reader J: "Interesting that the WaPo could write an entire article on the decline of public housing in NYC without ever mentioning the words "ACLU," "liberalism," and "Lindsay." [Link added] ... True! The piece--on Sotomayor's childhood--makes it seem as if the projects were just suddenly swamped by waves of drugs ("Then heroin surged through the projects ... Then came crack ...") as opposed to, say, an increasingly concentrated culture of fatherless dependence in which drug users and dealers and gang members couldn't be evicted because of misguided due process concerns about deprivation of "new property"! ... (I remember an excellent piece by WaPo's Blaine Harden on the difficulty of evicting bad actors from housing projects, but haven't been able to find it.). ...
P.S.: The Post's Robin Shulman does mention that in 1981 Congress "changed eligibility rules to give preference in public housing to the poorest households," which had the perverse effect of intensifying the culture of poverty by excluding middle class and working class tenants. But Shulman doesn't make that point--instead quoting an expert who simply says the change made public housing the "housing of last resort." And that was a problem because ...? ... 8:21 P.M.
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Matt Cooper calls "the idea that that the Clintons were unwilling to take half-a-loaf" on health care "total revisionism." Hmm. It sure seemed that way at the time! ... P.S.: Unless Cooper's talking about a specific early-on period when the Clinton plan was first being produced--he uses the vague qualifier "back then" .... 7:32 P.M.
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Obama vs. Slate: Obama cites "medical errors that lead to 100,000 lives lost unnecessarily in our hospitals every year." [E.A.] Walter Olson smells BS, and cites a Slate article to back him up. ... 7:25 P.M.
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Megan McArdle: Orszagism--the belief that Obama's universal coverage plan will actually lower costs in the long run--is the "Laffer Curve of the Left." ... P.S.: Again, if you suspect McArdle is right, this doesn't mean you have to oppose Obama's plan. It just means you have to plan on paying for it. ... P.P.S.: As a supporter of universal coverage, I worry that Obama's "emphasis on reducing health care costs over expanding insurance coverage" will turn out to be as fateful a blunder as Bill Clinton's first-term decison to delay welfare reform until after health care reform. Why, exactly--as "Obama advisers say"--does "the focus on cost savings [have] appeal for all Americans, not just the uninsured"? It would seem closer to the truth to say the focus on cost savings has something to scare, or at least annoy, everyone in the health debate. Meanwhile, Obama's plan to expand coverage--by promising an end to "job lock" and the "preexisting condition" exclusion, plus the general fear that you're going to be stuck with an insurance company that has focused most of its effort on the fine print that will let it weasel out of paying for treatment when you really need it--has potential appeal way beyond the "uninsured." ...
Update: Tyler Cowen's Sunday NYT piece, which called Orszagism "voodoo economics," was on balance objectively Pro-Obamacare, I thought. Cowen branded as "long overdue" Obama's key cost-cutting plan (to empower experts to fund treatments according to "comparative effectiveness"). In particular, Cowen endorsed "more limits on end-of-life-care." But that's easy for him to say--he's a conservative who doesn't think that when the government refuses to pay for non-"cost effective" medical treatment it's the same as denying treatment. (After all, patients can still pay out of their own pockets.) If you are a liberal who thinks that not funding a $100,000 operation is effectively denying the operation to a large group of citizens--one reason, perhaps, that you favor universal health insurance in the first place--then supporting Obama and Orszag on this point isn't as easy. ... 3:28 A.M.
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Embarrassing suck-up post by Henry Blodget crediting "Barack Obama and Steve Rattner" with more-or-less saving General Motors, which "now plans to be profitable ... at a 10-million-unit US annual rate of sales, versus the 15 million previously" and which "has a new car that some people actually want to buy--the Camaro--which apparently gets 29 miles per gallon with 300 horsepower." ... Blodget's analysis: "Exciting!" ... a) "Barack Obama and Steve Rattner." I wonder how poor Ron Bloom feels. Bloom may have more power on the Obama auto task force than Rattner but he doesn't have the media connections. b) If General Motors doesn't "turnaround," will we be allowed to blame Rattner? ['Even Steve Rattner couldn't save GM'--ed Sigh] c) Rattner shows up and, boom, suddenly GM has "a new car that some people actually want to buy"! It's amazing Rattner had time to design and produce the new Camaro so quickly with all his other financial and filmmaking activities. d) The 300-hp. Camaro gets 22 mpg overall--not bad, but it's deceptive for Blodget to use the higher "highway" estimate. e) The Camaro, with projected sales of around 100,000, isn't nearly a big enough deal in itself to save GM. And do you really think the Camaro's "halo" is going to get people to buy this? ...
Blodget seems like a journalistic marshmallow. Whatever news outfit helped rehabilitate this once-tarnished figure has a lot to answer for. ... Oh, wait. Never mind. ...
Update: A better-informed take from Robert Farago, who's perhaps too committed to the Bail/FAIL! thesis. Still ... On holdover GM bureaucrats:
If anything, Chapter 11 means they’re even LESS motivated than before. Think of it this way: if GM’s overlords screw the pooch (again), what are the feds going to do? Declare bankruptcy?
On the Presidential task force (PTFOA):
“Hands-off” or not, the 25-member PTFOA adds another level of bureaucracy above the existing GM bureaucracy. If each PTFOA member fires off fifty emails a day, that’s 1,250 more internal comms per day. The PTFOA also has a staff. Meetings. Agendas. Targets. Reports. Memos. The federal quango is a shadow governing body for a company that needs less management, not more.
True story: New GM is inherently worse than old GM. And it’s going to get worse from here.
Plus: But by 2012, GM will be 82% of the way toward saving 29% on engineering costs! Even Automotive News is laughing at them, apparently. ... 12:27 P.M.
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Karl Rove argues that a "public" insurance option will cause individuals and companies to drop private insurance and switch to the "public" plan:
They'd be happy to shift some of the expense -- and all of the administration headaches -- to Washington. And once the private insurance market has been dismantled it will be gone. [E.A.]
I must be missing something--why would the collapse of private health insurance be irreversible? It can't be that hard to start a private insurance company--it's not like starting a private nuclear power company or even an auto factory. If we enact a public plan, but at some point in the future a potential market for private insurance opens up--maybe because Republicans win huge congressional majorities and decide to end government-run insurance--private insurers will spring up to make money in that market, no?...
P.S.: Rove's pet Bush-era plan to buy Hispanic votes with a giant semi-amnesty of illegal immigrants--now that would be irreversible. ...
P.P.S.: I also don't understand how a public plan would 1) lure customers by paying extra-low fees to doctors and hospitals (causing business to decide that dropping private coverage was "cost effective") while at the same time it would 2) be "far too expensive." I can see the one flaw, and I can see the other. I can't see both at the same time. ... 12:01 A.M.
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Take it away, Matt Yglesias! ... 12:00 A.M.
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Let the Boomers Die? II: Reader D emails:
When I worked in the healthcare industry several years ago there was a study that found a large percentage of Medicare costs were incurred in the last six months of life. This is not about whether you get your hip replaced or your cataracts removed. It is more about heroic efforts to keep you alive. I'm a baby boomer also. So I want the healthcare available but I don't want to languish in an ICU on a ventilator with IV drips with no hope!
My answer: Fair enough. But I want to make the decision to cut off treatment, not have it made by a cost-watching health board. Choice! The resonance with the abortion debate seems obvious. ... Both are life/death decisions. Are they both best handled by individuals and their families in consultation with their doctors? You'd think the case for "choice" at the end of life might be stronger, since the life at stake is likely to be able to participate in making that choice. ...
Update: Prof. Althouse distinguishes this kind of choice from "right to die" cases. "It's one thing to deny the choice to die, quite another to deny the choice to live." Lively comments ensue, some of them quite moving. This isn't an issue people haven't thought about. ... 11:19 P.M.
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CNN's coverage of the chaos immediately following the Iranian vote--or lack of coverage--is now a big story. Luckily, the Washington Post can put its crack media critic on it. You know, the one who works for CNN! ... He's already defending the network on Twitter. ... [via Andrew Sullivan] 10:55 P.M.
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Micheline Maynard on GM: 1) Rattner: "We're not going to fail ." I would say that lets us say he failed if he fails! Specifically, it rules out the "We're giving them a shot but if they collapse in a couple of years at least we delayed it" defense.. .. 2) Rattner's problem has always been his high profiling in the press. Yesterday he was quoted boasting about not failing in the same newspaper in which his (possibly more powerful) auto task force colleague, Ron Bloom, was attempting to strike a lower key note in testimony to Congress.... 3) The government isn't going to run GM--it's a "passive shareholder"--but according to Rattner it is going to change GM's culture. OK!. ...4) So here's how the culture will change, if I read Maynard right: By empowering GM's holdover old guard managers who are steeped in the old culture to make decisions without consulting the holdover old guard CEO, Fritz Henderson. Sounds like a dramatic "wholesale restructuring" to me. . .. 5) This delegation of power to the existing bureaucrats will also be accompanied by "a deeper level of scrutiny" from the board of directors. But no second-guessing, of course. ..
Meanwhile at FIAT/Chrysler: Sergio Marchionne is speed dating ...
And I have buried the lede: Robert Farago has an amazing, Washington-Monthlyesque explanation for GM's "crap interiors." I don't quite believe it. But if true, it should be a segment on "60 Minutes" ... 2:39 A.M.
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Jennifer Rubin gives her trademark optimistic analysis (from an anti-Wagner Act union perspective) of the prospects for "card check" compromise. ... The CW is less optimistic, I think. ... 2:07 A.M.
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My friend Robert Wright, who applies a Marxist/materialist view of religion in his new book, thinks Palestinians, and the Muslim world generally, will behave better when they no longer feel "humiliated and dispossessed" and "not in control of their own destiny." Presumably he'd say the same thing about Israeli Jews who believe "God wants the people of Israel to populate all of the promised land." ... I share his basic viewpoint--but it has a big Marxist/Condescension problem, not unlike Obama's famous "cling" problem with guns and God in Pennsylvania. 'That's a nice little religious faith you have there. But I know that your beliefs will change if your circumstances change.' At some point the people you are dealing with sense that you think you know better than they do (which you probably do and definitely think you do). ... When I last wrote about this problem, I didn't have a very satisfying solution, though it looks better to me now than it did then. .... One response I didn't discuss is to hang a lantern on the problem and drily condescend to God too: "The Abrahamic God has shown the capacity for great moral growth," writes Wright. See you next week at the usual time, God. ... Not sure that helps! ... 1:53 A.M.
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Reader E notes a generational aspect to the enthusiasm of whippersnappers like Ezra Klein for lowering government medical costs by making "rational" health care decisions not to pay for treatments when "a person's life, or health, is not worth the price":
The Medicare savings are an outcomes-based review. When you're talking about Medicare, it means reviewing what procedures have a lower chance of success at the end of life, and then denying payment for them. The Rs will call this euthanasia of the baby boom, maybe there is another name for it though. ...
As a Boomer, I must say I find it hard to believe we will stand for it--aren't we the vainest generation in history that wants to live forever, etc.? Don't we want the full might of the American medical-industrial complex dedicated to devising expensive breakthrough treatments that will prolong the lives of our friends and us? I know I do. It's easy for Klein to want "rational" budgetary cost controls imposed to limit end-of-life care. He's 17.
P.S.: Reader E adds: "Haven't you noticed all the 'quality death' stuff on NPR's Fresh Air?" I haven't. But I did notice all the "good death" propagandizing around the Schiavo case, and thought at the time it was a warm-up act for the end-of-life cost-cutting that might accompany a national health care system. ...
See also: Barone ("But what do the young know or care about health insurance?") ...
1:49 A.M.
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I think Ezra Klein misstates OMB director Peter Orszag's position--which Orszag presented on his blog and in a phone call responding to Virginia Postrel (who argued that if there's so much money to be saved in health care, as demonstrated by waste in Medicare, why doesn't the administration start by eliminating the waste in Medicare?). Klein writes:
The cost reforms, by contrast, are being done cautiously, cooperatively, and with a focus on Medicare. ....
Which is why it's a bit bizarre to read Postrel writing that "if more-efficient government management can slash health-care costs by addressing all these problems, why not start with Medicare?" When it comes to cost, they actually are starting with Medicare. They hope that the efficiencies work and are voluntarily adopted by private insurance. But there's no actual mechanism to make that happen.
My impression (which could be wrong!) is that there are two sorts of cost savings Orszag has in mind. 1) A bunch of "scoreable" Medicare and Medicaid cuts** that will save $5-600 billion over 10 years and (along with some revenue increases) pay for expanding health coverage over that period; and 2) A collection of more ambitious "game changer" reforms*** that aren't part of that next-10-year calculation but will "lower the rate of health care cost growth" in the long run. These game changer reforms are not limited to Medicare and Medicaid, as I understand it--indeed, I think it is Orszag's position that you can't do them if you limit them to Medicare and Medicaid.
This latter assertion appears to be a central pillar of "Orszagism," which is defined the claim that (as Ryan Lizza puts it) "health-care reform is deficit reduction,"-- that without Obama's sweeping health care reforms we just can't "bend the cost curve" down enough in the long run. If the "game changers" could simply be limited to Medicare and Medicaid, you could simply implement them without reforming the rest of the health care system--Postrel's point--thereby more or less totally undermining Orszagism. Expanding health care coverage and cutting long-term federal health-related budget costs would be two distinct, separable policy initiatives (one reliably expensive, one seemingly speculative).
The assertion--that you can't just do the cuts in Medicare--isn't really defended in Orszag's recent posts, though he promises more dialogue in the future. Orszag also has to convince people that a) his "game changers" actually will cut costs--in Medicare, or anywhere b) without compromising health or medical progress and c) without engaging in the nasty treatment-denying behavior HMO's got in trouble for a decade or so ago. ... Update: I forgot d)--and they'll cut costs so much that they'll more than compensate for the obvious ways universal health insurance will increase long-term health costs (i.e., by increasing the number of consumers demanding medical services and enabling them to exert political pressure, not necessarily illegitimate, to pay for particular expensive treatments, including treatments Orszag's various cost-conscious reforms might deny). ... Best of luck to him.
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** As described in a recent presidential letter, these "scoreable" shorter-term cuts include
reducing overpayments to Medicare Advantage private insurers; strengthening Medicare and Medicaid payment accuracy by cutting waste, fraud and abuse; improving care for Medicare patients after hospitalizations; and encouraging physicians to form "accountable care organizations" to improve the quality of care for Medicare patients ....
Plus "another $200 to $300 billion" in Medicare and Medicaid savings to be announced soon. ...
***--The "game changers," as described by Orszag, include
steps such as health IT, research into what works and what doesn’t, prevention and wellness, and changes in incentives so that Americans get the best care not just more care.
2:42 A.M.
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It's Pedal to the Metal for the New Chrysler! Obama spokesperson: "We are delighted that the Chrysler-Fiat alliance can now go forward, allowing Chrysler to re-emerge as a competitive and viable automaker." [E..A.] Viable? Competitive? Hello? We are writing this down. Words like that will be remembered in two years, if Chrysler even makes it that far. ... 2:41 A.M.
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Arianna vs. the Anti-Objectification Cheesecake Police: All the best fights are intra-left these days. ... P.S.: kf last month, City Paper this month. ... 2:27 A.M.
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John Dickerson: "Did Google do it for Deeds?" No. ... 2:18 A.M.
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GM Design Chief Ed Welburn did not not not accuse a HuffPo blogger of racism (sorry TTAC). ... But he did cite his grotesquely cheesy, cartoonish new Camaro as an example of what can be created in GM's "cutting edge 21st century environment." ... Welburn seems like a nice guy. But I would say the Camaro is a firing offense (though,, if he's a UAW member, it will take 6 unexcused Camaros). ... 2:16 A.M.
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Arlen Specter tells union demonstrators they will be "satisfied" with his vote on card check. Peter Kirsanow thinks this is fairly ominious for card-check critics, as does John McCormack. I tend to agree. But is Specter really the only swing vote, or only the most rivetingly craven? ... 3:14 A.M.
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DDog Bites Man: Mark Blumenthal catches MyDD's Jerome Armstrong saying something foolish about the Virginia gubernatorial primary (the Mackerdammerung). ... Update: McAuliffe crushed. Cafe Milano sets prix fixe shiva. (Wine not included.) ... 3:10 A.M.
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SCOTUSblog on why we shouldn't get too excited about Justice Ginsburg's delay of the Chrysler deal. (One reason: "The wording of Ginsburg's order - 'stayed pending further order' - is the conventional way by which a Justice or the Court carries out an action that is expected to be short in duration, and not controlling - or even hinting at - the ultimate outcome.") ... Second Thoughts: FIAT's Sergio Marchionne removed a major obstacle to a Supreme Court intervention by declaring FIAT wouldn't walk away from the deal even if the June 15 deadline passes. (There had been informed speculation that the Court wouldn't want to get involved if it would then get blamed when FIAT bailed and the deal collapsed). ... Plus I talked with a veteran Court-watcher who made these points: 1) You know that Scalia and Thomas would like to intervene; 2) Roberts and Alito would probably want to intervene if they thought there's a chance of getting a fifth vote; 3) The issue isn't just bankruptcy law, it's the balance of executive and legislative power. The Obama administration, thanks to its expansive interpretation of TARP authority, now has tremendous power to make industrial policy without Congressional approval. On GM, for example, you'd think the crucial issue would be whether Congress will authorize subsidizing the "new" GM beyond the $50 billion already committed. But if the administration has authority to keep funneling TARP funds to automakers as well as banks (and if the banks start repaying billions that can then be redirected to Detroit) it may never have to go back to Congress to ask for more money, no? This would be the sort of issue the Court might want to confront even if it weren't, you know, embarrassingly results-oriented. ...
Update: Never mind. ....
P.S.: Doesn't Marchionne's pledge contradict the Obama administration's consistent position during the Chrysler bankruptcy, which was that everyone had to hurry up in part in order to prevent FIAT from walking away on June 15? ...
3:04 A.M.
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Do not follow me on twitter. ...The range of short posts that are good enough to twitter but not good enough to blog seems pretty narrow. Doubt I've hit it yet. ... 2:58 A.M.
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OMB Director Orszag responds on his blog to recent skepticism about the health care cost savings he anticipates. ... I'm still skeptical, at least about whether Orszag's long-run "game changers" will save the government from titanic health-care driven deficits starting ten years from now. See, for example, Dr. Groopman on one heavily advertised "game changer," electronic medical records, which threatens to solve the health care cost crisis the way touch-screen voting solved the ballot-counting crisis. ...
If the "game changers" smell a bit like snake oil, and if they aren't (Orszag insists) necessary to offset the cost of expanded coverage over the next ten years, and if meanwhile they position the government as the bean-counting ogre who will be denying medical treatments people might want--where is the political genius in constantly bringing them up? ...More tk. ... 2:40 P.M.
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Ron Brownstein on the problem of reviving Rustbelt manufacturing:
For officials at every level, the great hope is that these fading car towns can move from rust to green, from building autos to manufacturing wind turbines and solar panels or buses and subway cars. These places offer many advantages for such production: factories, supply chains, transportation links, and a skilled workforce "that knows how to do metal," as Democratic Sen. Sherrod Brown of Ohio says.
But there are few examples of such conversions succeeding in the auto plants already closed, notes Dan Luria, research director for the Michigan Manufacturing Technology Center, a government-business partnership. And although Obama's policies ensure that the U.S. will buy more alternative energy and transit equipment in the years ahead, Luria says, there's no guarantee that those products will be built in America, much less in these particular communities, unless Washington encourages it through an integrated set of carrots and sticks beyond anything under discussion. Brown, likewise, is urging a national manufacturing policy. [E.A.]
Hmm. Why might manufacturers of "alternative energy and transit equipment" want to avoid locating their factories in the heavily-unionized rustbelt? Do you think the ongoing example of Detroit's Big Three might have a cautionary effect on their decision-making? Let's have a "national manufacturing policy" to make them do it anyway--with an "integrated set of carrots and sticks.". .... 2:38 P.M.
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If All You Cared About Was Speed ... : Republican economist Keith Hennessy argues that even a Democratic welfare-like demogrant would have produced a faster stimulus than the infrastructure spending the administration chose--even if only a fraction of the money was actually spent (as opposed to saved). .... 2:37 P.M.
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Accessible, quotable macho GM product exec Bob Lutz manages to get semi-fawning press even after he's been put out to pasture. But you have to wonder if he's really as clueless as he makes it seem. Back in February, he said he didn't know why GM's Saturn brand had flopped:
“We spent a huge bundle of money in giving Saturn an absolutely no-excuses product lineup, top to bottom. They had a better and fresher lineup than any GM division, and the sales just never materialized ...[snip] we don’t have the time or the resources to take 10 years to figure it out and possibly turn it around."
I could have saved him the 10 years, as could about 85% of the readers of Car and Driver, because it's obvious why Saturn flopped: The company had built a popular brand as a sort of feel-good anti-car--vaguely tractor-like, noisy, but made of semi-indestructible plastic by dedicated Tennessee workers and--unique in nearly all of GM--actually reliable. GM threw all this away and filled Saturn showrooms with cars designed to appeal to totally different buyers: rebadged mainstream Opels. They were OK, but creepily overstyled and not so reliable. End of explanation.
Today the Washington Post paraphprases Lutz on the importance of the Prius to Toyota:
Lutz sees several reasons for Toyota's ascendancy, none more important than becoming the darling of media analysts and environmentalists in the wake of its seminal hybrid, the Prius ...
In early 2006 -- "much too late," he acknowledges now -- a troubled Lutz saw that driving a Prius constituted nothing less than a values statement for many of its owners, a means to bask in the perception of their own enlightenment. Even more alarming, thought Lutz, was that some consumers not enamored of the Prius itself nonetheless saw its existence as proof of Toyota's wisdom. The Prius's presence alone was drawing people to Toyota lots, where the curious bought everything from bigger sedans to sport-utility vehicles and trucks with about the same gas mileage as their GM counterparts, groused Lutz. Part of what he called the "halo effect."
One sporadically selling hybrid, he realized, had greened an entire company and catapulted nearly every vehicle in its product line. It was a disturbing sea change for GM executives. ... Meanwhile, American automakers, including GM, suffered under the perception that they were stuck in yesteryear and saddled with cars of inferior quality. [E.A.]
Lutz can't possibly be enough of a moron to believe that the Prius and its "halo effect" are a primary reason for Toyota's ascendancy. Toyota has been ascendant for at least three decades, and GM declining, for a simple reason: Toyota built cars that worked ("bulletproof," as they say) at a time when GM built cars that didn't work. That's what was "drawing people to Toyota lots" a generation before the Prius was conceived. Even today, when GM suffers "under the perception that they [are] saddled with cars of inferior quality," you only have to look at the Consumer Reports reliability ratings to see that the reason GM is saddled with this perception is that the perception is accurate. (The Cadillac CTS that Lutz boasts about, for example, may be a great performer. But it's still so unreliable that Consumer Reports can't recommend it. The beautiful Pontiac Solstice, which Lutz championed, has a true crap record. The Prius, meanwhile, is spectacularly reliable.)
For those three decades of Japanese market surge, much of the talk of Detroit executives has been an attempt to dance around the central issue of reliability and 'build quality,' and the inability of Detroit to provide it. For most of Lutz's career, he played down the importance of Japanese reliability by talking up the "romance" of the Euro-style sports cars and American muscle cars he (rightly) liked. Now he plays down the importance of Japanese reliability by talking up the "halo effect" that a cutting-edge "green" car can create with bicoastal elites (whom he doesn't like) and the media.
Environmentalism has become the latest distraction and delusion for Detroit. Chrysler admits that small, fuel efficient FIAT models aren't going to sell in large numbers--but hey, they're going to have a "halo effect" that will "burnish" the entire Chrysler line! Chevrolet will only sell a few thousand Volts--but the bicoastal elite appeal of green will suck media-addled buyers into the "reinvented" GM.
No. Detroit cars will sell when they're bulletproof, not when they're green (or, in Lutz's new spin, when they're made by a company that also sells something "green"). But only one of the Big Three U.S. car manufacturers has made dramatic progress catching up to Japan on the bulletproof front--and it's not Chrysler or GM. It's the one that hasn't gone broke. ... 2:32 P.M.
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U.S. Pushed FIAT Deal on Chrysler (WSJ): Chrysler execs were lobbying for an alternative merger with GM even in late stages, apparently. Obama's task force wanted FIAT. ... P.S.:You have to wonder if the Obama team knows the FIAT deal it promoted won't work, and arranged it simply as a way to delay the inevitable--while it actively avoided a merger that would foist Chrysler on GM, because GM does have at least a chance to survive after bankruptcy and doesn't need Chrysler's baggage. (Why make Chevy responsible for the Sebring?) ... P.P.S.: Note that this isn't paranoia, but posinoia--the nagging suspicion that people in power are doing seemingly bad things for secret good purposes. ... 6:47 P.M.
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Gran Salida Update: Also from the WSJ--
Emigration from Mexico to the U.S. dropped 13% in the first quarter of this year compared to the same period last year, with more Mexicans leaving the U.S. than coming in. ... [snip]
In the case of Mexico, Latin America's largest supplier of new immigrants to the U.S., data released this week by the Mexican government shows emigration to the U.S. dropped 13% in the first quarter of 2009. In the same period, more people returned to Mexico than left Mexico for the U.S., about 139,000 and 137,000, respectively. ... [snip]
For now, Santiago, a 37-year-old Mexican migrant who declined to give his last name, is placing his bets on his home country. On a recent flight from the U.S. to Mexico City, Santiago wore a black leather jacket and cowboy boots ... [E.A.]
Hmm. Doesn't this violate Immigration PC 2.0, 2009 edition, in which it's acceptable to admit that levels of illegal immigration into the U.S. are falling but unacceptable to suggest that immigrants are actually returning home in large numbers (which would fit uncomfortably into the Comprehensive party line that illegal immigrants are here to stay and will never leave, and don't have much more in the way of active attachments to their home countries than, say, the Pilgrims did). ... See, for example, the notorious Nina Bernstein, "No Evidence of Return Migration is Found," NYT, January 15, 2009. ...
P.P.S: Always trust content from kausfiles. (The academics are always the last to know!) ... 6:43 P.M.
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"If you wanted to end it, this really wasn't the way to do it": Ever wondered what Eduwonk looks like? I know I did. Here he surfaces to explain why Obama's decision on the D.C. vouchers program was "really subversive." ... 6:41 P.M.
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From USAT's June, 2008 account of the much-cited Harbour Report on auto manufacturing:
Chrysler's Toledo South plant, which makes the Jeep Wrangler, was the most productive assembly plant in North America in 2007 after improving its productivity by 38 percent to 13.57 hours per vehicle. But Jeep had the lowest quality rating of any brand in a J.D. Power and Associates survey released Wednesday. The survey measures both mechanical and design problems in the first 90 days of vehicle ownership.
Frank Ewasyshyn, Chrysler's vice president of manufacturing, said Thursday that productivity doesn't really relate to quality, and that Chrysler is working hard to improve its quality.
"The quality piece for us still continues to be a journey," he said. [E.A.]
P.S.: Chrysler can learn from its new partner: Chrysler scored second to last in customer satisfaction in this 2009 survey of "vehicle ownership satisfaction" in the U.K. Only one company did worse! ... That company? FIAT. ...
P.P.S.: Quote of the day, for the actual today, goes to Robert Farago of TTAC, and relates to GM:
Evercore Partners predict that the zombie automaker will return to life (though not as we know it) by 2014. What’s more, stock in New GM will be worth $48 billion straight out of the gate. Hang on. I’m lousy at math (as you know). But if the United States government owns 60 percent of a $48 billion New GM, our share on day one would be worth $28.8b. So, if the feds dumped those shares, we’d “only” lose $19.2 billion. SELL!
3:21 P.M.
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Annals of Orszagism: Virginia Postrel calls the Obama administration's bluff on health care costs. A White House Council of Economic Advisers report recently asserted that
30 percent of Medicare’s costs could be saved without adverse health consequences.
Postrel's answer: What's stopping you?
Medicare is a huge, single-payer, government-run program. It ought to provide the perfect environment for experimentation. If more-efficient government management can slash health-care costs by addressing all these problems, why not start with Medicare? Let's see what "better management" looks like applied to Medicare before we roll it out to the rest of the country.
This is not a completely cynical suggestion. Medicare is, for instance, a logical place to start to design better electronic records systems and the incentives to use them. But you do have to wonder why a report that claims that Medicare is wasting 30 percent of its spending thinks it's making a case for making the rest of the health care system more like Medicare.
I don't know that I agree with Postrel about postponing universal health insurance until we see what Obama's cost control strategy looks like, and what results it produces. People still need health care. But maybe we shouldn't base the Democratic position in the health care debate entirely on Orszagism--the unproven theory that Obama's health care reform will reduce health care costs and help control the federal budget deficit without adversely affecting health. ...
Update/Backfill: Orszag himself seemingly claims not to be relying on Orszagism, at least for the "next five to 10 years," during which the administration is insisting its health care reform be "paid for." a) To make it "paid for," Orszag is relying in large part on Medicare and Medicaid savings that are "scoreable ...over the medium term." These include "strengthening Medicare and Medicaid payment accuracy by cutting waste, fraud and abuse; improving care for Medicare patients after hospitalizations" and some "$200 to $300 billion" in other reductions. Is it really clear that these savings will be reliably achieved (again, without adversely affecting health)? And b) is there then another whole overlay of "game changing" savings solutions--Orszag mentions something called"patient-centered quality research" and "re-orienting financial incentives through bundling"--that couldn't be applied to just Medicare and Medicad but rather require Obama's universal coverage? c) What about after 10 years? Orszag's charts show health care costs slowing their seemingly inexorable rise, thanks to his "game changers." But what if the game isn't changed, and costs keep going up--perhaps because medical science keeps inventing fancy new effective treatments that patients demand, perhaps even because universal health insurance has expanded the number of patients doing the demanding? Then we are in deep budgetary trouble, which is why Ryan Lizza said "Obama is in effect betting his Presidency on Orszag's thesis." ...
Wouldn't it be more prudent to pay for health care expansion the old fashioned way--through tax increases and sure-thing program cuts, like ... means-testing of Social Security? Bonus political point: Dems couldn't be accused of wanting a health care plan as a way to let the government subtly or unsubtly limit treatments. ...
P.P.S.: Thanks to Instapundit for the update. ...
More: Orszag calls Postrel, Postrel responds. (Her final point: "The administration is beginning to realize that it overreached when it tried to spin health-care reform as a free lunch.") ... 1:15 A.M.
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Chooch Test: From a piece in Green Car Reports defending the Obama task force against right-wing criticism--and crediting Obama with subtle mastery in rescuing Detroit:
If more dollars are requested, then Obama will have betrayed the principle he articulated the day GM filed. He was quoted in The New York Times saying the government would take a hands-off approach to managing GM and divest its stock as soon as possible.
Even pithier, he said his three goals were, "To get GM back on its feet, take a hands-off approach and get out quickly." [E.A.]
I'll settle for that. If Obama doesn't request more money for GM--even if the Feds never get their $50 billion back-- and GM survives he will have succeeded. If GM needs more to survive, he will have failed, by his own lights. Good to emphasize the marker he's more or less laid down. ... P.S.: Same goes for Chrysler, although Chrysler was always pretty obviously doomed. GM was not. ...
P.P.S.: Here's the LAT on GM's future product plans:
Among the new vehicles the automaker hopes will get the new GM off to a strong start are the redesigned Buick LaCrosse sedan; the SRX crossover and CTS sport wagon from Cadillac; the GMC Terrain and Chevy Equinox crossovers; the Chevy Cruze, GM's new global subcompact; and the reintroduction of the classic Chevy Camaro muscle car.
Do you see any "game changers" in there? I don't. Maybe the LaCrosse will be a solid hit--at least in China! But it's a bit strange-lookin'. And how many veteran Buick owners kept on buying Buicks because they trusted the dealer down the street--who won't be there anymore? The idea that these people will switch dealers and not also switch brands may be one of the rosy assumptions underlying the bailout plan. ....
Update: Robert Farago of The Truth About Cars notes that the projections of GM's financial adviser, the ones that show a profit of $3 billion in 2011, assume "a six million new car sales jump in the next two years." That's not pessimistic! Farago flatly predicts [E.A.]:
New GM won’t last much more than a year without a fresh federal funding infusion.
It's on. Someone will be wrong. My bet is that it's Obama. ... 3:56 P.M.
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The NYT's David Leonhardt punctures General Motors' comic overoptimism, but in at least one respect seems to share it. He asserts that, as part of the bailout/bankruptcy deal ,
Orwellian work rules that sapped productivity and creativity have been removed.
Really? Here's the concession agreement between GM and the UAW. This is what looks like the relevant provision on work rules:
Work Practices
The National Parties discussed locations that haven't reached new local agreements and those that have ratified local agreements, but haven't achieved General Motors' 2007 competititve operating agreement rating of ninety-three (93) percent or more. Those locations that currently have ratified local agreements that meet the rating will not be subject to the following:
As soon as practicable, but within thirty (30) days of ratification, the National Parties will assist and engage the locations with the implementation of modifications, comparable to General Motors' 2007 competitive operating benchmark, needed to achieve a minimum ninety three (93) percent rating. Additionally, the aforementioned locations efforts to achieve the goal will be completed as soon as possible, but no later than December 31, 2009.
The National Parties will be responsible to review the progress of each location every thirty (30) days to ensure compliance by the completion date.
Maybe all these words have meaning to insiders that's not apparent to outsiders. But it sure looks like 1) Some union locals are holdouts in GM's campaign to get rid of inefficient work rules. (The power of union locals, even in the face of the UAW national leadership, has always been a problem when it comes to streamlining work practices); 2) Under the new agreement, the work rules haven't "been removed." Rather, the parties have pledged to complete the tooth-pulling process of negotiating their demise by the end of the year. It's a target, not a fait accompli. And what happens if that target isn't reached (as, apparently, the earlier targets weren't reached)? The deal doesn't say. ...
P.S.: Note that the agreement doesn't commit plants that have achieved the 93% "rating" to making further improvements. One big secret of Toyota's success, of course, is that its factories are continually looking for "modifications" that further increase productivity, without worrying about whether those modifications violate "local agreements." Standing pat at 93%, whatever it means, doesn't seem like the way to beat Toyota.
P.P.S.: Leonhardt also writes:
G.M. cars haven't been as good as their rivals. If you've ever experienced the joy of being told that your rental car is a Toyota Corolla rather than a Chevrolet Impala, you know this.
I dunno. I think I'd rather have an Impala, assuming costs are equal. It's a bigger, more luxurious car. It's not going to break down during a brief rental! It's just not a car you'd buy for yourself. ... If Leonhardt had compared the Corolla with its actual same-size GM competitor, the unpleasant Chevy Cobalt, he'd have an unassailable point. ... 1:25 A.M.
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sofas? ... 12:23 P.M.
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"Shooting Distance": Some unnamed administration officials (rhymes with Shatner!) recently visited the WaPo ed board to sell the GM bailout deal. They were less than fully successful, to judge by the Post's latest editorial--at least once you get past the third paragraph. This is from the fifth:
[U]nion concessions were "painful" only by the peculiar standards of Big Three labor relations: At a time when some American workers are facing stiff pay cuts, UAW workers gave up their customary paid holiday on Easter Monday and their right to overtime pay after less than 40 hours per week. They still get health benefits that are far better than those received by many American families upon whose tax money GM jobs now depend. Ditto for UAW hourly wages, though according to the task force, GM's labor costs are now within "shooting distance" of those at nonunion plants run by Honda, Toyota and other foreign firms. Cumbersome UAW work rules have only been tweaked.
Even the one "big risk" the union is said to have taken--turning "much of its $20 billion retiree health fund claim into stock"--apparently has to be qualified by two factors: 1) The deal apparently contains an underpublicized allocation of preferred stock to the UAW health care fund (VEBA) in addition to its 17% or so ownership share in the new firm. Preferred stock pays dividends, and the dividend on this stock will still pay $585 million into the VEBA per year, according to WaPo. In other words, the union doesn't really have to rely entirely on the value of its 17% ownership share. It will still get large cash payments. 2) If GM goes broke again, and the VEBA winds up a dozen or so billion short, don't you think the federal government is going to step in and guarantee health benefits? That might partly explain why the UAW was willing to take more risks with those retiree benefits than with the pay of current workers. ...
Whether or not the union has given up a lot less than it would have to give up in a normal bankruptcy in which union contracts can be voided--and it has--the question is whether it has given up enough to make GM a "viable" auto company. I would have thought the administration would, off the record, have already fallen back on the 'if-it-fails-at-least-we-delayed-it' defense. But apparently not--they are sticking to Obama's optimistic public line that the current deal is enough to get GM "back on its feet," even to become "once more a symbol of America's success."
It seems the UAW isn't quite as confident. Why did it decide to ask for dividend-paying preferred stock instead of the larger ownership share (39%) originally planned? According to the WSJ:
"The fear at the UAW was that ownership in GM could eventually be worth very little," said a person involved in the talks.
They should know. ...
Backfill: Clarifying Michael Levine piece on the un-taken middle alternative to
a) liquidation and
c) Obama's expensive nationalization. ... If the process had to start last November, though, it seems unfair to blame only Obama. ...
1:19 A.M.
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Creepy Latte: Politico's Mike Allen, summarizing the day's news in his "Playbook" for those in a hurry, sees fit to print two long paragraphs of a self-serving letter from Starbucks' president, Howard Schultz, on health issues. Sample:
Over the past year, we expanded our food menu to include a variety of healthier options, including a yogurt parfait, fruit cups, protein plate, Vivanno Smoothies, and Perfect Oatmeal. ... [snip] ... Our commitment over the next 18 months is to increase the scope of our healthy food and beverage choices ....
Riveting stuff. Would Allen have delighted his readers with Schultz's prose if Starbucks wasn't frequently a sponsor of "Playbook"? ... It's a fine ethical line we all have to walk in these hard economic times! But not that fine. ... 3:06 A.M.
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Sorry, Ta-Nehesi: The Root's Dayo Olopade agrees there's "something to" the argument that Obama--as "a sort of vessel, the ultimate mannequin for black male [identification]"--is helping to change hip hop fashion away from saggy jeans and toward something new. ... 10:54 P.M.
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The Good Andrew again: Playing the Wallace Shawn role in My Dinner with Bob .... See also. ... 1:58 P.M.
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Weird that Kate Hudson never seems to fall for a man who's not a Bold Faced Name. .. .1:51 P.M.
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