Category Archives: Articles

Blow Smoke, Yell Fire

May 20, 2013 – 12:07 pm

For a few days, it looked like the Obama administration might actually be in trouble. A week ago Friday, ABC’s Jonathan Karl released excerpts of White House emails that appeared to show the White House engineering a cover-up of the true nature of the Benghazi attack, and at the very least being way more involved in producing the Susan Rice talking points than the administration had claimed.

Across the country, Democrats felt that old sinking feeling. It was Monica Lewinsky’s blue dress all over again. After years of beating back outrageous Republican attempts to manufacture a scandal out of nothing — Bill Ayers, the birth certificate, death panels, Obama’s “real” father, Solyndra, Fast and Furious, and on and on and on (just like Vince Foster, Whitewater, Travelgate, and Clinton’s illegitimate black son the last time a Democrat was president) — the long fishing expedition finally had an actual fish.

And even if the rest of it was a typical fisherman’s exaggeration, there would always be that one fish to point to. The conspiracy-theorist’s eternal “What are they hiding?” had turned into the much more reasonable “What else are they hiding?”

Jonathan Chait wrote:

Karl’s report produced among mainstream and liberal reporters a sense of embarrassment at having dismissed the story as a weird partisan obsession.

Worst of all, Obama’s defenders had to wonder the same thing. What blue dresses were hanging in some closet, waiting to be found? If you spoke up, would you eventually look as foolish as all the people who insisted that Bill Clinton “did not have sex with that woman”?

Then came the announcement of an IRS scandal, and an AP scandal, and the sky seemed to falling. So much smoke! There must be a fire under there somewhere.

Then the counter-scandal broke: ABC had been tricked. The “emails” they released had been doctored by Republicans to make the administration look bad. When you read the actual emails, you saw the State Department and the CIA jockeying for advantage, with the White House playing more-or-less the hands-off role it originally claimed.

So there’s still no fish. It’s still “a weird partisan obsession”. It’s still “What are they hiding?” not “What else are they hiding?”

Likewise, as details of the IRS and AP affairs come out, each is disturbing in its own way, but the IRS story seems contained to one IRS office with no White House involvement, and the “scandal” in the AP story is the legal bipartisan policy the administration was faithfully carrying out.

The white-whale hunt for an impeachable offense will no doubt continue, but this pseudo-scandals are not it.

Let’s review where we are:

Benghazi. The four American deaths are a combination of (i) being a diplomat in an anarchic post-civil-war environment is dangerous; and (ii) some screw-ups from which lessons should be learned.  The report of the Accountability Review Board has 24 recommendations. Maybe Congress should be talking about them rather than faking emails and defrauding reporters.

The only intentional wrong-doing anybody has uncovered so far is the forging of the emails and Jonathan Karl’s lie that he had “obtained” the emails when actually Republican staffers had just told him about them. Karl, BTW, is digging in deeper and deeper, which really ought to end his career. He has expressed “regret” about quoting the emails incorrectly, and that he “should have been clearer about the attribution”. But his main regret is that this has “become a distraction from the story, which still entirely stands.”

No, the story totally does not stand, unless you think the story is that the talking points went through 12 iterations, as talking points probably always do. Karl’s scoop was a smoking gun about White House dishonesty. That scoop was false, and an honest reporter would admit that.

Remember: When Dan Rather failed to properly authenticate documents that made President Bush look bad, people got fired and Rather ultimately had to leave CBS. Smearing a Republican president is a serious matter.

The IRS. The background here is that organizations that educate the public about political issues can receive tax-exempt contributions and don’t have to reveal their donors, while organizations that try to elect specific candidates can’t and do. It’s a fuzzy boundary frequently abused: A group might educate the public about how horrible Policy X is, and then also educate the public about how Yellow Party candidate Smith supports Policy X and the Orange Party candidate Jones opposes it. But as long as they don’t actually say “Vote for Jones”, they might maintain their tax-exempt status.

Citizens United opened floodgates of money for such organizations and a lot of new ones were established. All their applications for tax-exempt status went through one office in Cincinnati. Tuesday, the IRS inspector general issued a report “Inappropriate Criteria Were Used to Identify Tax-Exempt Applications for Review“. Conservative groups, particularly Tea Party groups, were scrutinized more closely.

Everybody agrees that was wrong. The question is why it happened. If the idea was hatched in the White House as a way to hobble its enemies, then it’s a genuine Watergate-level scandal. But there’s not a shred of evidence for that. The practice apparently started with one guy, and so far nobody has asked him why. Atlantic reports:

The crux of the investigation by Congress and the administration will be why that employee started to flag those applications — and why, as the inspector general notes, it soon became an office-wide practice. Was it an attempt to streamline the workflow? Or was it politically motivated behavior meant to target Tea Party groups? So far, it appears to be the former;

A number of side issues crop up in this story:

The damage done is exaggerated. The typical result was that a flagged group needed to fill out some extra forms and provide some additional information. Approval of tax-exempt status took longer than it otherwise might have. Once an application’s review started, there’s no evidence that politics played a role in the ultimate decision.

Tarring ObamaCare. Republicans have been using this issue as a way to attack ObamaCare, because the IRS has a role in it. The worst of these arguments revive the “death panels” hoax, with the added wrinkle that your surgery might be denied because you’re conservative. But in reality, the IRS deals only with the tax issues that arise in ObamaCare: Are you in the income bracket that allows you to claim a health-insurance subsidy, or do you owe the individual-mandate penalty? There’s no mechanism for the IRS to affect treatment decisions, no matter how politically corrupt it might get.

The laws about political activity and tax-exempt organizations are screwed up. Jeffrey Toobin claims that the real scandal is what’s legal, and the way big-money organizations game the system.

Anecdotal reports of audits prove nothing. Now any conservative who gets audited can claim political persecution, in the same way that any white guy who applies for a job and doesn’t get it can claim to be a victim of affirmative action. The WSJ’s Kimberley Strassel claims victim status for the big Romney donor Frank VanderSloot based on … well, nothing really.

Was the White House involved in the IRS’s targeting of conservatives? No investigation needed to answer that one. Of course it was.

How can you argue with that? Peggy Noonan then picks up the ball and runs further, claiming victimhood for Billy Graham and a couple other people, and then concluding:

It is not even remotely possible the actions were the work of just a few agents. This was more systemic. It was an operation. The word was out: Get the Democratic Party’s foes. It is not remotely possible nobody in the IRS knew what was going on until very recently.

It’s true: If you imagine a systemic set of violations, then you need a systemic conspiracy to account for it. But again, it would be nice to have just a shred of evidence before going there.

Nate Silver brings some sanity to the topic.

The fact that Ms. Noonan has identified four conservatives from that group of thousands provides no evidence at all toward her hypothesis. Nor would it tell us very much if dozens or even hundreds of conservative activists disclosed that they had been audited. This is exactly what you would expect in a country where there are 1.5 million audits every year.

AP. I’ll let AP itself make the charge:

The Justice Department secretly obtained two months of telephone records of reporters and editors for The Associated Press in what the news cooperative’s top executive called a “massive and unprecedented intrusion” into how news organizations gather the news. …

The government would not say why it sought the records. Officials have previously said in public testimony that the U.S. attorney in Washington is conducting a criminal investigation into who may have provided information contained in a May 7, 2012, AP story about a foiled terror plot. The story disclosed details of a CIA operation in Yemen that stopped an al-Qaida plot in the spring of 2012 to detonate a bomb on an airplane bound for the United States.

Like the IRS story, this is bad. But once again the badness is what is legal: During the Bush administration, Congress changed the law to give the government the power to do this kind of stuff. It ought to be unconstitutional, but the Supreme Court has managed to either excuse it or dodge cases where it might come up — and the worst justices on this issue are the conservative ones like Thomas and Scalia.

Just like the overall policy, the AP case has a bipartisan origin:

The two leak inquiries were started after Republicans in Congress accused the Obama administration of orchestrating news stories intended to demonstrate the president’s toughness on terrorism and improve his chance for reelection. The Republicans sought a special prosecutor, but Holder instead named two veteran prosecutors to handle the inquiries.

Jonathan Chait sums up:

The AP story is a more audacious step in a long government campaign, spanning two administrations, to ruthlessly prosecute leaks about the fight against Jihadi terrorism. In every single step of this fight before this one, Republicans occupied the far-right flank. They voted down shield laws; they demanded more vigorous prosecution of leakers than Obama was carrying out.

So absolutely, let’s have a new shield law and let’s get some people on the Supreme Court who take the First Amendment seriously. Let’s reverse the get-the-whistleblower policy that has stood since 9-11. But this is not a political scandal, it’s Obama carrying out a bipartisan policy.

Why? Finally, we need to examine why the Republicans are doing this. Why is everything that goes wrong force-fit into a now-we-can-impeach-Obama frame?

Heritage Action, a PAC associated with the conservative Heritage Foundation, explained in a letter to John Boehner and Eric Cantor:

it would be imprudent to do anything that shifts the focus from the Obama administration to the ideological differences within the House Republican Conference. To that end, we urge you to avoid bringing any legislation to the House floor that could expose or highlight major schisms within the conference.

In other words: Don’t try to legislate, because Republicans can’t agree on any legislative agenda. The only thing they can agree on is that they hate Obama. So stick with that. Investigate everything. Make mountains out of molehills if you have to. Just don’t try to do anything constructive, because that will divide the party.

By weeklysift | Tagged , | Comments (2)

Benghazi Hearings: Congress as Reality TV

May 13, 2013 – 11:43 am

I’ve had a hard time figuring out how to write about Benghazi without becoming part of the problem. So much nonsense has been spouted that simply saying “Benghazi” in certain circles is code for “impeach President Obama“. And that puts the rest of us in the don’t-think-about-an-elephant zone, where even explaining why something is nonsense reinforces it.

This week it got worse. Wednesday, the House Oversight and Government Reform Committee held new hearings on Benghazi, showcasing what Chairman Darrell Issa referred to as “whistleblowers” who “revealed new information that undermines the Obama Administration’s assertion that there are no more questions left to answer about Benghazi.” (When has there ever been a subject with “no more questions left to answer”? If that’s the goal, hearings will continue forever.)

In anticipation of those hearings, apparently without knowing exactly what the witnesses would say, Mike Huckabee predicted on his Fox News show: “I believe that before it’s all over, this president will not fill out his full term.” (Senator Inhofe at least waited for the hearings to happen before he predicted impeachment.) Repeating a talking point I heard elsewhere on Fox and saw in comments all over the internet, Huckabee claimed Benghazi was “more serious” than Watergate “because four Americans did in fact die” — a statement that could only make sense if President Obama had been part of a plot to kill them. (As Bob Cesca has pointed out, American embassies and consulates were attacked 13 times during the Bush administration, with far a death total far beyond four. You probably don’t remember any of those incidents.)

If you listened to such predictions at length — and they were made 24/7 on Fox and the rest of the conservative media — you were primed to jump straight from “new Benghazi revelations” to “high crimes and misdemeanors”.

Then we get to Wednesday. Three State Department insiders did testify, and they did provide new information that made the Obama administration look bad. However, none of the new information is on the scale that the hype predicted, and much of it contradicted conspiracy theories popular on the Right. But their testimony did give an excuse for headlines about “new Benghazi revelations” that then fueled even more discussion of some of the same conspiracy theories that the testimony directly contradicted.

Let’s see if we can sort this out. Before listening to anybody’s commentary, I recommend looking at the Wikipedia article on the attack as a whole. Seeing the basic outline of what-happened-when will immunize you to a lot of the obvious nonsense being thrown around.

Like any event that turns out badly, Benghazi leaves three avenues for criticism: lack of preparation and precautions before the fact, debatable decisions made during the event, and inaccurate statements made after the event. (A comparison to the “other” 9-11 is useful: The government ignored warnings that attacks were imminent; in hindsight, you can imagine pulling first-responders out of the second tower as soon as the first one collapsed; and clean-up crews were given bad information about the toxicity of the debris.)

At Benghazi, you can argue that the State Department sent people into too dangerous a situation with too little protection. You can blame the administration for the deployment and Congress for not appropriating enough for security.

You can also wish that some kind of rescue force could have been sent to save the four American lives. That’s the gist of the most quoted testimony Wednesday: Gregory Hicks talked very emotionally about four special forces soldiers who wanted to get from Tripoli to Benghazi, but couldn’t. When you look at actual timelines, though, the transport plane they failed to get onto arrived at Benghazi after the four victims were already dead. Hicks also wished an F-16 could have flown over Benghazi as a show of force that might have discouraged the second attack. But the Pentagon has made it clear that the nearest planes, based in Italy, are not on 24-hour alert and actually could not have been scrambled (together with the needed in-air refueling tanker) in time.

And finally, you can criticize what the administration said about the attacks afterward. This is probably the most legitimate criticism, but it’s also the least consequential, because at that point the attack had already happened and the four Americans were already dead. You can accuse the administration of making misleading statements — like no administration ever did that before — but nothing in the aftermath is remotely criminal or actionable. (It’s even arguable that what we see in the changing talking points is an ordinary bureaucratic turf fight, unrelated to the November election.)

Only a charlatan can say that Benghazi is “worse than Watergate” and then focus on Susan Rice’s performance on the Sunday talk shows. Nobody died because of what Rice said on “Meet the Press”.

To me, a story that is every bit as important as as Benghazi itself is: What has happened to our national conversation that has caused us to discuss Benghazi in such an outrageous way? It’s tempting to say, “Oh, that’s just politics.” But it really isn’t, or at least it didn’t used to be. Try to imagine the Democrats in Congress treating 9-11 this way: “It’s far worse than Watergate; thousands of Americans are dead.”

There was certainly no lack of 9-11 conspiracy theories that Democrats could have winked and nodded at. Plenty of crazies put up web pages claiming that 9-11 was an inside job. One poll claimed that a third of the country believed the Bush administration had at least some role in letting the attacks happen.

Democrats in Congress could have pandered to that view. The model Republicans have used with Benghazi (and Solyndra and Fast & Furious, both of which have fizzled as scandals, despite being “worse than Watergate” for a time) would have worked just as well: Don’t endorse any specific theory with checkable details, but announce over-the-top general judgments that only the most extreme conspiracy theories could justify. Lump all the theories under one vague label (Benghazi!) and leave your rhetoric slippery, so that you can encourage all the nutcases without pinning yourself down. Turn every new detail into a promise that more revelations are coming.

The Democratic leadership never went down that road. 9-11 was a national tragedy, not a political football. There were hearings and investigations, and some people in both parties asked tough questions, but that’s where the comparison ends. Getting tagged as a Truther was the kiss-of-death in the Democratic establishment. (Ask Van Jones.)

But the Republican leadership has gone down that road with Benghazi. And the result is that lots of the Republican rank-and-file will tell you that Obama should be impeached for Benghazi!, even though they can’t quite say what Benghazi! means, beyond “four Americans are dead”. On the Reality-Based Community blog, Andrew Sabl spelled it out:

At this point in the career of a scandal, or attempted scandal, there are often disagreements over whether the charges are true. But I can’t remember the last time I’ve seen a scandal where I don’t even know what they are.

Sabl described what specific charges would look like and challenged his readers to come up with some. None did.

Steve Benen made a similar point:

Eight months after the attack itself, I know Republicans think there’s been a cover-up, but I haven’t the foggiest idea what it is they think has been covered up. For all the talk of a political “scandal,” no one seems capable of pointing to anything specific that’s scandalous. For all the conspiracy theories, there’s no underlying conspiracy to be found.

And so Wednesday, Chairman Issa advertised “whistleblowers”. But he never said what exactly they blew the whistle on.

Again, compare to Democrats during the Bush administration. Lots of liberals called for Bush’s impeachment, but they offered specific grounds: breaking the laws against torture, or fabricating evidence to invade Iraq. You could argue with their reasoning or their evidence, but you knew what it was. Democrats in Congress could have made hard-to-pin-down code words out of Abu Ghraib or Katrina, and linked them (deniably) to wild conspiracy theories, but they didn’t.

It’s tempting to stop there, with the implication that Democrats in Congress have more honesty or civic virtue than Republicans. But I think there’s a deeper level to examine. Democrats didn’t pander to the third of the country that was open to a 9-11 conspiracy theories because it was only a third of the country. You can’t win elections with 33% of the vote.

Republicans are clearly not thinking that way. As I listen to Republican politicians talk about Benghazi, they seem to be making no effort at all to speak to the majority of Americans or to offer evidence that might convince a swing voter. They are talking to their base, which is probably about a third of the country.

What’s going on? I think David Frum had it right: “Republicans originally thought that Fox worked for us and now we’re discovering we work for Fox.” The point of Benghazi! isn’t to deliver a majority of votes for the next Mitt Romney. The point is to get ratings for Fox and subscribers for Glenn Beck. The Conservative Entertainment Complex has taken control of the Republican Party and is managing the Party for its own purposes. A third of the country? It may not win many elections, but it’s a fabulous audience for an entertainer.

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Prosperity Without Growth?

May 6, 2013 – 10:57 am

When you take a very-long-term view of the future of civilization, the one option that seems most unlikely is that we can continue the patterns of the last few centuries: an ever-increasing population consuming ever-more stuff, using ever-more natural resources to produce it, and leaving ever-more waste products for the planet to absorb.

Futurists embarrass themselves when they predict precisely when and how that pattern will break, but still, it defies my imagination to picture how this could all continue indefinitely down the millennia. Eventually — whether by wise planning, cataclysm, alien conquest, or the return of Jesus — the exponential growth is going to stop.*

What will that look like? If you stipulate those steady-state conditions — stable population, stable resource use, and each generation leaving the planet’s natural environment more-or-less the way they found it — what kind of society can you construct? Can you come up with one that has a place for people more-or-less like us? Or does the whole concept involve making over the human character completely? Could the people in such a no-growth society feel prosperous? Or is prosperity-without-growth a contradiction?

A number of fairly smart, reasonable people have been asking those questions for a while now, and they’re starting to come up with some visions — sketchy ones, to be sure, but sketched-out well enough that the rest of us should start paying attention. One such vision is in Enough is Enough by Rob Dietz and Dan O’Neill.

Disclaimers. Growth has gotten to be such a religion that no-growth smacks of heresy. Like most heresies, it has been caricatured by the faithful to such a degree that any discussion has to start with a few denials.

Two examples of non-growing economies leap to mind: growth-oriented economies that are failing to grow (as the American economy has failed since the housing bubble burst), and aboriginal hunter-gatherer economies. The first example is characterized by despair, lack of opportunity,  and increasing poverty; the second, by discomfort, lack of technology, and vulnerability to disease and famine. Aboriginal societies may live in harmony with Nature, but they also live at the mercy of Nature. One thing you can say for the global economy is that Iowa can have a drought without Iowans starving to death.

Neither example is what the no-growth visionaries are proposing. A society without growth could continue to have antibiotics and the internet — and could even continue innovating, as long as the innovations-as-a-whole didn’t increase the consumption of resources or the production of waste.

A growth-oriented economy that doesn’t grow is the worst of both worlds. It consumes resources unsustainably, and yet fails to provide opportunity and hope. If that were the goal, it could easily be achieved: Just instruct the Fed to keep interest rates high enough to choke off new investment.

The challenge, though, is quite different: To envision a steady-state relationship between Nature and a stable population of humans, while providing those humans the opportunity to lead satisfying lives.

Outline. The book is in three parts. The first discusses the overall idea of “enough”. The second breaks this down into specific areas: How could we achieve a stable population? How could a non-growing economy deal with poverty? What would banking and investment look like? And the third discusses strategies for changing the culture and the political system.

Problem-solving attitude. Because it covers so many topics and is intended to further an open-ended discussion, the book really can’t be condensed. Its strength is in its details, not in a sound bite that gets elaborated over 200 pages.

But the other important aspect of the book is the attitude it projects: It takes the problem of planetary depletion seriously and approaches it with a problem-solving attitude. So it is not a jeremiad, or a prophesy of doom, or a denial that anything really needs to change — three categories that take in most of the debate on these topics. It’s easy to find reasons why a stable economy can’t happen, but comparatively rare to find people who accept that it must happen eventually, and then bring a problem-solving attitude to the question of how.

A number of factors evolved with the idea of economic growth, and they will have to change or be replaced to achieve stability: a money-creating banking system, measuring the economy by GDP, and corporations devoted to constant growth are just a few of the ones discussed in more detail. An example of the kind of change a stable economy would need: Much of what is done today by profit-seeking corporations could be done by consumer-owned co-ops focused on providing service rather than producing an ever-increasing profit for investors.**

The poor held hostage. To me, the most significant argument against a stable economy says, “Morally, how can we rein in economic growth when so many people still don’t have enough?” My problem with that question: I have lost faith that the capitalist economy will ever provide enough for everybody, now matter how high global GDP gets. Over the last few decades, the top 1% has gotten better and better at capturing economic growth for themselves. From the point of view of a CEO seeking higher profits for his corporation, a better life for the poor is an inefficiency to be avoided. Across-the-board wage increases are a capitalist nightmare, not a fulfillment of the capitalist system.

In the Dietz/O’Neill view, we need to turn this kind of thinking around: Rather than continuing to grow the economy in hopes that some of the new consumables will filter down to the poor, we need to solve the problem of inequality so that we can achieve a stable economy. Poverty is a political problem, not an economic problem. Growing the economy without changing the politics won’t solve it.

Rather than putting the entire burden of proof on the no-growth vision, I think we also have to stop accepting a “someday” vision of ending poverty through growth. Anyone who makes the anti-poverty argument for growth needs to explain exactly how growth is going to help the poor, and offer a projection of how much more growth it will take to eradicate poverty before we can stabilize the economy’s toll on the planet.

Trustworthy governance. Again and again, I was struck by how the Dietz/O’Neill vision requires that we work together as a species. The easiest way to envision that unity is via some Hunger-Games-style tyranny, which no one (least of all Dietz and O’Neill) wants. But even the most free and democratic vision of a stable economy depends on establishing some trustworthy global institutions.

For example, a global cap-and-trade system to stabilize the CO2 in the atmosphere would work only if people can’t cheat anywhere in the world, if the tradable CO2 certificates can’t be counterfeited, and if you can’t “earn” them by creating bogus carbon-offset projects — trees that are never actually planted, etc.

Similarly, population could be stabilized through incentives and voluntary cooperation rather than one-child mandates and forced sterilizations. But someone would have to monitor all that and adjust the incentives accordingly, and the rest of us would have to trust the fairness of that monitoring agency.

This is the part I worry about most: If you have money and power and you want to derail the vision of a stable future, all you really have to do is create distrust. What could be easier?

Not a lone voice. Another striking thing about Enough is Enough is the extent to which it builds on the work of many others. For example, the view of money, debt, and banking will be familiar to Sift readers from David Graeber’s Debt: the first 5,000 years and Warren Mosler’s Seven Deadly Innocent Frauds of Economic Policy.

I’m sure many people will look on this as cranks quoting other cranks, but I don’t. I’m starting to see a unifying view develop.

Virtual consumption. Futurists have to be wary of a technology-will-save-us argument, which is always too easy and is often a mirage. But I think Dietz and O’Neill miss one important way that technology can contribute to a sustainable future: virtualization. We’re already seeing some of it: My book collection is gradually turning into patterns of electrical charges rather than shelves of paper.

Dietz and O’Neill point out (appropriately) that such changes are meaningless if they just make paper cheaper and allow somebody else to consume more of it. But recent sci-fi (starting with Snow Crash and continuing into more recent works like The Quantum Thief or Ready Player One) points to the greater possibilities.

You can think of consumption as serving four purposes: survival, comfort, entertainment, and competition for status. It is easy to imagine “enough” when we talk about survival and comfort, and maybe even entertainment. But the really open-ended consumption happens when we compete for status. I can imagine wanting a boat for entertainment, but the only reason to want a 400-foot yacht is to out-do the guys who can only afford 300-foot yachts. (As far back as the Roman sumptuary laws, the essence of the moral argument to limit consumption is that some people are starving so that others can raise their status.)

Survival and comfort require real-world resources. (You can’t eat pixels.) But if the culture evolved so that we got most of our entertainment inside virtual worlds and competed for status there, then a sustainable economy would be much easier to achieve.

* Space travel is sometimes presented as a far-future solution. While I can imagine a Noah’s-Ark-style spaceship seeding another planet with humans, I can’t imagine inter-stellar travel ever being so cheap that emigration has a significant impact on Earth’s population. (At least that’s not a future I’m willing to count on.) So Earth’s remaining citizens would still have to come to terms with the planet’s limitations.

Think about the colonization of the New World. Except for a few temporary situations (like the Irish Potato Famine), Europe’s population continued going up, even as it sent more and more people to America. Europe today is more crowded than ever.

** This got me thinking. Back when cable TV was being established, we all took for granted the model of a privately financed network made economically feasible by granting a monopoly. But the New-Deal-era model of the rural electric co-ops also would have worked: government-guaranteed loans to establish consumer-owned co-ops. If we’d done that, every year you’d get to vote on the leadership and policy of your cable system.

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What’s Really Wrong With Congress?

April 29, 2013 – 11:00 am

Everybody seems to agree that Congress doesn’t work.

If you’re liberal, you’re appalled that even something like universal background checks for gun purchases (90% public approval!) can’t pass. If you’re conservative, you’re horrified that nothing can be done about the mounting national debt or the projections for exponential growth in entitlement spending.

And even if you care not at all about parties or ideologies, it’s just embarrassing to watch our leaders create one artificial crisis after another. We’re the richest country on the planet, and yet we’re constantly threatening to shut down our government, default on our bonds, mint a trillion-dollar coin, or do some other weird thing that would shame the generalissimo of a banana republic.

Is this any way to run a super power?

Former Congressman Tom Allen has written the best book I’ve seen about the problem — Dangerous Convictions: What’s really wrong with the U.S. Congress.

Allen served as one of Maine’s two congressmen for six terms before he quit to run for the Senate in 2008. (Susan Collins beat him handily.) He seems to have been a more-or-less average Democrat. (GovTrack.com places him in the middle of the Democratic pack ideologically.) In his book, he discusses the few times he was able to work with Republicans, the many times he wasn’t, and what the difference might have been.

He is unimpressed with many of the standard explanations of Congress’ polarization and overall dysfunctionality, particularly the ones that attribute the problem to personalities. Yes, Democrats and Republicans no longer socialize together the way they did back in Jackie Kennedy’s day. But Allen sees that more as symptom than cause. Republican congressmen seemed like nice enough guys when he met them in the House gym, and he had no trouble working with them when they shared an interest, like when Maine and New Hampshire politicians all wanted to keep the Portsmouth Naval Shipyard open.

And while mainstream pundits may pine for “bipartisanship”, the lack of it is also an empty explanation. There is no bipartisan philosophy, so what would a bipartisan alliance do? (Whenever a pundit gets specific about a bipartisan agenda, some rude person points out that Obama has already proposed most of it and been rejected.)

Allen saw enough pre-Obama polarization to doubt the explanations that pin the blame on him. (i.e., Obama doesn’t schmooze enough, or twist enough arms.)

Even the influence of money doesn’t really explain the problem (though it certainly doesn’t help). The United States has suffered periods of even worse corruption in the past — among the many candidates, I would pick the Grant era — and yet the country managed to more-or-less function.

Worldviews. Allen sees the problem not as an unwillingness to find common ground, but as an inability to get to a point where compromise is possible. Take global warming. If Democrats were pushing one solution (cap-and-trade, say, or a carbon tax) and Republicans another, then it might not be that hard to pass a program with elements of each. That’s how business has gotten done in Washington since L’Enfant sketched the city on paper.

But instead, a proposed Democratic solution is met with a Republican denial that the problem exists. How do you compromise on that?

Four chapters of Allen’s book focus on specific issues and the worldview gaps that have made them unsolvable: the federal budget (where Democrats can’t accept the Republican claim that tax cuts pay for themselves), Iraq (where a plan for the country’s reconstruction was deemed unnecessary), health care (where Republicans never really admitted that the uninsured were a problem), and global warming.

Again and again, Allen and his Democratic colleagues ended up asking each other, “Do these guys really believe what they’re saying?” Unable to imagine that they did, the only other explanations were that the other side had been bought by monied interests or that they were pandering to crazy people. Hence the distrust and unwillingness to invite them to parties.

That view, obviously, favors Allen’s own side. But he then makes an admirable effort to see through Republican eyes. What if they do believe what they’re saying, but their worldview is so different that we seem to be the ones who must have nefarious motives? How could that come about?

The explanation he comes to still favors the Democrats, but is much more nuanced and fascinating.

First and second languages. Allen begins with a deep insight from Robert Bellah’s 1985 classic Habits of the Heart: Americans discuss values and morality in two ways. Our first language is individualistic: It’s my life. This is what I want to do with it. I want the freedom to be my own person and live by my own values. Our second language (which we speak less well) is communitarian: I want to belong. I want to do right by others. I want to live in a community that is just and fair.

We don’t really have a language for discussing the trade-offs between individuality and community. Instead, we tend to flip abruptly from one to the other: We’re individualists until suddenly we sense that we’ve gone too far, and then we’re communitarians for a while.

(This insight parallels George Lakoff’s models of the conservative strict-father morality and the liberal nurturant-parent morality, particularly as I adjusted them in Red Family, Blue Family in 2005. Lakoff observes that there is no “center” morality. Instead, centrists maintain both models and apply different ones to different issues.)

Conservative rhetoric speaks the first language, which is why it often sounds simpler and clearer. (Small government. Low taxes.) Liberal rhetoric speaks the second language, so it often sounds muddled and requires a longer explanation than a sound bite allows.

(Allen doesn’t discuss social issues, where liberals sometimes have the first language/second language advantage. Gay rights is at a tipping point now because liberals are winning that debate in both languages: Gays should be free to live their own lives, and my community should treat them fairly.)

This point in history. Two things about the current situation give Democrats the advantage:

  • The shift from a local/national economy to a global economy has created problems that are fundamentally not individual. When your job gets shipped to China or the value of your house crashes, it’s generally not because of anything you did.
  • Our governing philosophy has been individualistic since Reagan. (Even Clinton followed a kinder, gentler conservative agenda on things like welfare reform and bank deregulation.) So all the low-hanging fruit has been picked by now. If a problem can be solved by free markets and low taxes, we’ve solved it already.

Consequently, we’re at a point where the respective advantages of the two parties are wildly divergent: If a conversation can be kept on an abstract level, the Republican rhetorical advantage holds: They speak Americans’ first language and Democrats speak the second language. But if you get into details and start gathering evidence on a particular issue, the Democratic solution works better.

The budget debate is the perfect example: Republicans do well when they can keep the discussion on the level of “government spends too much” or can list some small examples of “government waste”. But when they have to quantify the amount of waste and list programs that they want to cut, they’re in trouble.

Selecting for ideologues. As a result, specific, evidence-based, expertise-respecting conservatism has all but died out. A Republican Congressman who publicly accepted, say, the consensus of climate scientists on global warming or the consensus of economists that tax cuts don’t pay for themselves — that candidate would be on the wrong side of conservative rhetoric in the next primary. One who went beyond rhetoric about government incompetence or “death panels” and presented a serious plan for what a Walmart worker should do when she gets breast cancer, well, he’d have a short career.

So we’re left with the conservative ideologues, with people who aren’t interested in discovering how the world is, because they know how it has to be: cutting taxes and spending has to be good, involving government in a problem has to be bad, government debt has to be bad, and so on. If some problem (like global warming or the 50 million people who lack health insurance) doesn’t have a free-market solution, then it can’t really be a problem.

To me, the paradigm is Rick Santorum’s indignation when someone confronted him with the fact that tens of thousands of the uninsured die unnecessarily every year. He simply couldn’t deal with it and substituted his fantasy world for the real one: People without health insurance don’t die unnecessarily, and if they do, it’s their own fault.

Talking past each other. So the typical liberal/conservative debate in Congress these days looks like this: The liberal will present an evidence-based expertise-based plan to, say, deal with the economy’s measurable lack of demand by spending money to fix our roads and bridges. The conservative will respond with unquantifiable, uncheckable assertions that debt will destroy business confidence, and that unemployment will go down if we stop coddling the unemployed with extended benefits and instead cut regulations to give the “job creators” more freedom.

Where can the conversation go from there? There is literally nothing to talk about. As Allen says:

Our political polarization and dysfunctional public debate is largely driven by convictions and worldviews immune to contrary evidence and expertise.

What Allen wants to see. Allen calls for a renewed commitment to four virtues: respect for evidence, tolerance of ambiguity, caring about consequences, and commitment to the common good.

Almost by accident, he winds up with the best program for Republican renewal I’ve seen: Republicans need a vision of a right-sized government, what it does, and where it gets the resources to do it.

They don’t have one now. What a conservative government should do is always “less”. As a result, Republicans can only unite on the negative: They can block what Democrats want to do, but on most of the serious problems that Americans face at the moment, they have no solutions to offer.

So in Republican primaries, the incumbent’s vision of “less government” can always be trumped by someone who wants even less than that. The only possible escape from this constant devolution is to envision a right-sized conservative government that is committed to solving certain problems and commands the resources to succeed.

By weeklysift | Tagged | Comments (6)

Why the Austerity Fraud Matters

April 22, 2013 – 10:41 am

When disputes break out among academics, most people don’t care. For good reason: Academic controversies are usually hard to follow, and concern topics that wouldn’t matter to most of us even if we understood them. (I was in an academic dispute once, and my side won. Trust me, you don’t want to hear about it.)

But this week a controversy broke out in economics, and it actually deserves your attention. A paper that has had a major influence on public policy around the world turns out to be wrong. And not just wrong in a subtle way that only geniuses can see, or even wrong in an everybody’s-human way that you look at and say, “Oh yeah, I’ve done that.” This one was wrong in three different ways that make you (or at least me) say, “That can’t be an accident.”

The bogus paper came out in 2010: “Growth in a Time of Debt” by Carmen Reinhardt and Ken Rogoff (both from Harvard). The paper that refutes it appeared last Monday: “Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff“ by Thomas Herndon, Michael Ash, and Robert Pollin (all from the University of Massachusetts).

Before I get into the back-and-forth of it, let’s return to why you should care. It has to do with whether the government should be trying to create jobs or cut spending.

Stimulus vs. austerity. Many countries came out of the Great Recession with a much larger national debt, but persistent unemployment and slow growth. And that led to a debate: The usual thing a government does when it has high unemployment and slow growth is spend money. (People need jobs and the private sector is skittish about expanding, so the government hires people to do things that need doing: building highways, fixing sewers, insulating homes, and so on. Or maybe the government boosts the economy by subsidizing certain kinds of consumption, like the popular cash-for-clunkers program that got a bunch of old gas-guzzling cars off the road.)

But maybe this time the thing to do was to cut spending, because of all that debt. Maybe spending more, and so increasing the national debt, would just make things worse.

The same debate was happening in all countries, and none of them went completely one way or the other. But the poster child for austerity has been the United Kingdom, where it hasn’t worked. Here’s how British economic growth has compared to the projections made by the UK’s Office for Budget Responsibility. Austerity has brought the UK essentially no economic growth for three years.

The US has had its own stimulus/austerity debate, which has kept the Obama administration from spending as much as it wanted (or as much as Paul Krugman wanted, which was even more). But compared to the other major economies, the US has been on the stimulus side of the debate, which is probably why (disappointing as our economy has been these last few years) we’re doing better than most other countries. (This graph is scaled so that all countries are equal when austerity-loving David Cameron became the UK’s prime minister.)

Basically, the US and Germany are the only countries in that group that have seen any net growth since 2008.

The gist of what we’ve seen since 2008 is: Keynes was right. In the long run you probably want to keep your national debt under some kind of control, but not when you have high unemployment and slow growth.

How Reinhart/Rogoff leads to Ryan. Now, obviously, the budget debate we keep having in Washington doesn’t acknowledge this reality at all. Conservatives like Paul Ryan and Rand Paul, who want drastic cuts in government spending  (to them, the sequester is just a down payment), somehow get away with claiming to have a “pro-growth” agenda.

How is that possible? Well, partly it’s just dogma. The Gospel According to Ayn Rand states that government is always and eternally bad for the economy — she called for “a complete separation of state and economics” — and no accumulation of facts can outweigh holy writ.

But also, a handful of economists provide academic cover for the “pro-growth” austerity nonsense. And the biggest fig leaf in the bunch is the Reinhart/Rogoff paper. In his 2013 budget proposal, Ryan wrote:

Even if high debt did not cause a crisis, the nation would be in for a long and grinding period of economic decline. A well-known study completed by economists Ken Rogoff and Carmen Reinhart confirms this common sense conclusion. The study found conclusive empirical evidence that gross debt (meaning all debt that a government owes, including debt held in government trust funds) exceeding 90 percent of the economy has a significant negative effect on economic growth.

More precisely, R/R found a “threshold” that gets crossed when a nation’s public debt exceeds 90% of the annual GDP. (The United States currently has  a debt-to-GDP ratio around 100%. It was comfortably below the 90% “threshold” until almost exactly the moment the R/R paper appeared.) In other words: All your economic intuition and experience might tell you not to cut spending in a slow-growth environment, but something magic happens when debt crosses 90%. Beyond that point, debt suddenly becomes toxic.

Jared Bernstein comments on the significance:

Those whose goal is severely shrinking the size of government in general and social insurance in particular need hair-on-fire results like this from established experts to keep the fire going,  even in the face of statistics that lean strongly the other way

What they did and why it’s wrong. Reinhart and Rogoff looked at 20 industrialized countries year-by-year and divided the country-years into four bins: years when the national debt was 0-30% of GDP, 30-60%, 60-90%, and over 90%. They found significantly lower average economic growth in the over-90% bin. The average annual growth rates for the four bins in the 1946-2009 (post-WW2) period were 4.1%, 2.8%, 2.8% and negative .1%.

Now, if you look at those countries and years one-by-one, the case isn’t always impressive. For example, 1946 in the US. We had a lot of debt because we’d just fought World War II, and we had a recession because all the discharged soldiers and laid-off tank-factory workers hadn’t found new jobs yet. So high debt and negative growth were happening at the same time, but not because government debt was killing the economy.

Those are the kinds of one-off situations that you hope cancel out in the averages. And they kinda-sorta do, if you assemble your data honestly and do the math right. Unfortunately, R/R did neither. When Herndon/Ash/Pollin go back and do the analysis right, growth in the over-90% bin jumps from negative 0.1% to positive 2.2%.

So what mistakes did R/R make? Well, one was really stupid: They plugged the wrong row number into a formula on their spreadsheet, so their average skipped a bunch of rows, representing 6 of the 20 countries. (They’ve confessed to that mistake.)

Second, their data-set didn’t really include all the country-years it should have. So, for example, New Zealand only has one year in their average, when it ought to have five. Unfortunately, that makes a huge difference in the country average, because that one year NZ had -7.9% growth, when the five-year average was +2.6%.

And third, they made the bizarre choice to average by country rather than by country-year. So that one anomalous year in New Zealand ended up constituting 1/14th of the entire average rather than the 1/110th it should have.

Why it’s so bad. The significance of the R/R paper comes entirely from those mistakes.

Yes, an honest and accurate accounting still shows a negative correlation between growth and debt-to-GDP ratios, but everybody would have expected that anyway, because there’s well-known causality in the other direction: recessions cause debt/GDP ratios to rise*. (GDP goes down because that’s the definition of a recession. Debt goes up for two reasons: Revenue drops because there’s less income to tax, and spending rises to pay for more unemployment insurance and food stamps.)

The only significant part of R/R was the threshold, and that was wrong: The something-magic-happens-at-90% was just a spreadsheet typo plus statistical sleight-of-hand.

So the data R/R assembled provides absolutely no reason to have some special fear about the current level of debt in the US. We haven’t just passed through some economic equivalent of the sound barrier. To the extent that debt was bad before, it’s still bad, and to the extent that it didn’t matter before, it still doesn’t matter.

Fraud. I anticipate taking heat for using the word fraud in the title. The Herndon/Ash/Pollin paper doesn’t use it, and to fully justify fraud you’d have to see into the hearts of Reinhart and Rogoff. Responsible academics are slow to use words like fraud, because academics are cautious in general. You’re not supposed to publish something you can’t fully prove, even if your rivals do.

But I’m not an academic any more, so I’m using a preponderance-of-evidence standard, not a beyond-reasonable-doubt standard. Let’s look at the three mistakes.

The spreadsheet error shows an unbelievable level of negligence, but if that were the only mistake I’d be inclined to give R/R some benefit of the doubt. The original mistake was almost certainly honest, but not finding the mistake is the real culpability. They didn’t look the gift horse in the mouth; the mistake gave them the result they wanted, so they didn’t check too hard.

They claim to have filled in the missing data in later research, but they’ve done nothing to point out what a difference it makes. And they defend their weighting scheme — an argument I could buy if they had defended that scheme in the original paper while pointing the major difference it made in the result. But they didn’t. They were hoping the readers wouldn’t notice.

In their response to H/A/P, Reinhart and Rogoff, defend their non-spreadsheet errors “in the strongest possible terms”.

But surely the authors do not mean to insinuate that we manipulated the data to exaggerate our results.

I can’t speak for H/A/P, but I won’t insinuate anything, I’ll say it outright: Yeah, R&R, you manipulated the data to exaggerate your results.

R/R’s response. One proof of the fraud is that they’re still doing it. Their response claims:

We do not, however, believe this regrettable slip [the spreadsheet error] affects in any significant way the central message of the paper or that in our subsequent work.

And that’s just flatly false.

Do Herndon et al. get dramatically different results on the relatively short post war sample they focus on? Not really. They, too, find lower growth associated with periods when debt is over 90 per cent.

And that’s sophistry. The “relatively short post war sample” are the economies that happen to resemble the United States today. And “lower growth” is not the result the paper is noted for; no one would care if that were the whole message, because that is completely explained by the well-known recession-causes-debt relationship. The 90% threshold is the paper’s claim to fame, and that result has blown up completely.

And finally, while they don’t explicitly claim that they’ve found a debt-causes-slow-growth relationship, they keep using their result as if they had. They do so even in their response:

There is also the question of whether these growth effects can be economically large. Here it is very misleading to think of 1 per cent growth differences without recognizing that the typical high debt episode lasts well over a decade (23 years on average in the full sample.)

It is utterly misleading to speak of a 1 per cent growth differential that lasts 10-25 years as small. If a country grows at 1 per cent below trend for 23 years, output will be roughly 25 per cent below trend at the end of the period, with massive cumulative effects.

That point is utterly meaningless if the causality works in the other direction, if the slow growth is causing the debt rather than the other way around. And another re-analysis of the R/R data shows that’s what’s happening. That analysis also was simple to do. As Matt Yglesias comments:

it’s striking that R&R didn’t even check this. I don’t begrudge any academic’s right to rush into publication with an interesting empirical finding based on the assembly of a novel and useful dataset. I don’t even begrudge them the right to keep their dataset private for a little while so they can internalize more of the benefits. But Reinhart and especially Rogoff have spent years now engaged in a high-profile political advocacy campaign grounded in a causal interpretation of their empirical work that both of them knew perfectly well was not in fact supported by their analysis.

Buying apples, selling oranges. And that’s the important point. The biggest reason R/R’s paper has been so badly misused in our political debate is that they have been out there misrepresenting their results. Senator Coburn described their testimony to 40 senators a few months before the debt-ceiling debacle in 2012. After listening to their initial testimony,

Senator Kent Conrad, D-N.D., the chairman of the Senate Budget Committee, then offered his own stern warning to the assembled senators. Turning around in his chair in the middle of the room, he explained to his colleagues that when our high debt burden causes our economy to slow by 1 point of GDP, as Reinhart and Rogoff estimate, that doesn’t slow our [economic growth] by 1 percent, but by 25 to 33 percent, because we are growing at only 3 or 4 percent per year.

Did either professor interrupt to say, “Wait, Senator, we’re not saying the debt causes a slowdown. Our data just shows a correlation that could be explained by slowdowns causing high debt.”? No.

Reinhart echoed Conrad’s point and explained that countries rarely pass the 90 percent debt-to-GDP tipping point precisely because it is dangerous to let that much debt accumulate.

Fraud. Fraud, fraud, fraud.

* A point I often make when numbers appear in the Sift: Correlation is not causation. Correlation just means that two things tend to go together; causation means that one causes the other. A very common fallacy is to display a graph showing that A and B go up (or down) together, and then say that A causes B.

My favorite way to demonstrate the fallacy: Birthdays are good for you; people who have a lot of birthdays tend to live long lives.

By weeklysift | Tagged | Comments (6)

Maybe 9-11 Can Be Over Now

April 22, 2013 – 8:23 am

Here’s my hope for the Boston Marathon bombing: Maybe it can mark the end of the 9-11 Era. It feels so different from 9-11. Maybe it can exorcize the demons that have haunted us these last dozen years.

9-11 was a wound that refused to heal. I think that had something to do with the kind of story it was and the way we told it: It was a tragedy, and the many heroic individual stories that came out of 9-11 just served to make the larger story that much more tragic.

The greatest heroes of 9-11 all died. They were the first responders who charged up the burning towers only to be crushed in the collapse. They were the passengers of United Flight 93, who crashed their own plane rather than let it become a bomb. We could not identify with them or feel connected to their courage, because we lived. To have survived on a day when the real heroes died … it felt almost shameful.

The villains — the men who hijacked the airliners and slammed them into the Twin Towers — were likewise dead. They died on their own terms, as martyrs and victors in their own eyes, and they were beyond our reach now.

So in spite of all the people who did the best they could that day, the overwhelming emotions of 9-11 were shame, depression, anger, and fear. As a country, America came out of 9-11 looking for somebody to blame, and wanting to mess them up as badly as we could.

We could not let the story end this way, so we took it to Afghanistan and Iraq. We took it to Bagram and Guantanamo and Abu Ghraib. If some of the people we killed or maimed or tortured were innocent, so be it. Collateral damage. Our people had been innocent too.

9-11 was a monstrous act that we couldn’t resolve in our hearts, so it turned us into monsters.*

But we will tell the Boston Marathon bombing story as a challenge that Americans rose to. Not years later in another country, but as it was happening. Not by dying or killing, but by living and saving lives. This time, the tragedy sets up the stories of heroism, not the other way around.

It started immediately, with the ordinary people, the runners and their friends and families, who raced into danger to help the wounded. But unlike the 9-11 first responders, they did not become martyrs or victims. They continue to walk among us like the typical Americans they are.

EMTs and police were already present at the finish line, and their performance will be a model for the rest of the world for years to come. Their story is a victory, not a tragedy. It is a tribute to them that only three people died on the scene.

Everyone who made it into an ambulance is still alive a week later, because hundreds more nurses and doctors became heroes by saving lives, not by dying or by taking lives in revenge. Like the runners and the EMTs, they did not vanish into a martyr’s Heaven, but melted back into the general population. Maybe you pass them on the highway or stand in line with them at the supermarket. Maybe you are one of them.

Our leaders expressed sorrow, promised justice, and asked for our cooperation. They got it. People sent in their photos, and studied photos taken by others. Asked to stay off the streets or keep to their homes, we did.

Police swarmed in from all over the area, and worked together under federal leadership without visible rancor. They did their jobs, protecting the public without becoming our masters. They did not create more victims by rounding up hundreds of innocents. A policeman died, a fourth victim, but no more civilians.

And they caught the bad guys. One died in a suburban shootout that miraculously killed no bystanders. The other was wounded, but managed to hide for most of  the next day. He was found by a citizen who did not kill or get himself killed. He called the police, who captured the suspect alive and took him to a hospital.

That night, the convoy of police leaving Watertown became a spontaneous victory parade, and the citizens (who had been cooped up in their houses all day) streamed out onto the streets to cheer.

Unlike 9-11, it was over.

This time, like the aid-giving marathoners, like the EMTs, like the hundreds of doctors and nurses and police, at least one perpetrator will live and not become a martyr larger than life. We may get what we never had for 9-11: an explanation and a motive. We may come to look on Dzhokhar Tsarnaev as a troubled teen-ager, rather than a demon we see whenever we close our eyes and keep trying to kill by projecting him onto others.

Along the way, we may exorcize another demon who has haunted us too long: the Terrorist Superman, who desires nothing but mayhem and can be stopped by nothing but death. Who requires superhuman security measures and inhuman methods of interrogation. The monster who can only be fought by other monsters.

And that forms the essence of my hope: Maybe the events of this week have shown us that we don’t have to be monsters any more.

Maybe we can just be people who help other people, workers who save lives by doing our jobs, citizens who respect our authorities and get respect in return. Maybe we can seek justice without losing our human compassion. Maybe we can stand for values higher than mere survival. Maybe we can once again be part of a nation that is admired rather than just feared.

9-11 will never be forgotten, but I think it is time for it to be over. Maybe now it can join the Kennedy assassination and Pearl Harbor and the other great sorrowful events of our history. A scar, a memory, but not a wound.

So this is my post-marathon-bombing hope: That now we can stop being the frightened, angry, shamed survivors of 9-11 and go back to being Americans. It’s been a long time.

* In an earlier version of this article that I posted on Daily Kos, some commenters were inclined to absolve everyday Americans and put the blame on President Bush. I’m not going to make excuses for Bush, but he didn’t create the widespread post-9-11 desire for violence, he just channeled it. By the time the Iraq invasion rolled around, I and many other people were opposed. But I definitely felt the fear and anger it was based on.

By weeklysift | Comments (5)

Four Things I Know About Social Security

April 15, 2013 – 10:05 am

1. It’s not going bankrupt in seven years.

Stephen Moore shouted this popular-but-bogus claim (over Bernie Sanders’ objections) on the April 5 episode of Real Time with Bill Mahr. It’s a common conservative talking point often put forward in publications like the Washington Times.

2020 is when the Social Security is projected to start paying out more than it takes in. (It already pays out more than it collects in taxes, but interest will make up the difference until 2020, according to the current Trustees’ Report.) This has to do with the retirement of the baby-boomers, and has been foreseen for decades. (If you’re a baby-boomer with an IRA, at some point you plan to start taking money out rather than putting money in. You don’t become bankrupt at that moment.) That’s why Social Security has been taking in more than it paid out since it was reformed by President Reagan and a Democratic Congress in 1983. (Then, the Social Security Trust Fund was only months away from hitting zero.) That’s how the Social Security Trust Fund accumulated its $2.7 trillion surplus.

The claims Moore shouted were “That money’s been spent already.” and “You can’t spend the same money twice.” He’s referring to the fact that the government-as-a-whole has not been building up a surplus (other than briefly at the end of the Clinton administration), so what the SSTF holds is not a stash of dollars or a pile of gold, but U.S. government bonds. In other words, the SSTF loaned its surplus to the rest of the government, which spent it. This has been demagogued as “raiding the trust fund” and somehow is supposed to make the whole idea of the SSTF illegitimate.

But nobody applies that logic to any other situation. When private pension funds hold big chunks of their assets in U.S. government bonds, or when individuals have government bonds in their IRAs, that’s considered the safest possible investment; nobody claims the money is “already spent”. Ditto for corporate bonds. Hasn’t the corporation “already spent” that money too? Or bank CDs — that money isn’t sitting in the vault; the bank loaned it to people who “already spent” it by starting businesses or building houses.

In short, “you can’t spend the same money twice” is flim-flam, and Stephen Moore and the Washington Times know it. (That’s why Moore had to shout. If people examine what he’s saying calmly and rationally, they’ll see through it.) The SSTF is holding $2.7 trillion in the safest possible investments. That stash will keep increasing until 2020, when the program will begin to tap it the way President Reagan and Speaker O’Neill pictured back in 1983.

2. It’s not a “Ponzi scheme”.

Shortly after World War I, Charles Ponzi opened an investment company that promised large returns from a murky investment strategy, and his early investors seemed to get the returns he promised. That drew in more investors, who also got big returns, and so on.

The secret was that Ponzi was using the new investments to pay the returns to the current investors, creating the appearance of profits that didn’t exist. Bernie Madoff used the same trick just a few years ago. Both schemes collapsed, as such schemes eventually must, because they require more and more investors to keep going.

In an ideal Ponzi scheme, the schemer disappears with the money at precisely the moment when investors start trying to cash out, but neither Ponzi nor Madoff was able to time it correctly. Both went to jail.

Calling Social Security a “Ponzi scheme” (as Rick Perry and other conservatives have done) is a pejorative way to point out something everybody knows: The program relies on current workers paying taxes in order to finance the pensions of retirees. If the economy collapsed to the point that no one could pay taxes, the SSTF would drain out and benefit payments would stop. (Fox News’ Andrew Napolitano presented these well-publicized facts as if they were some top-secret revelation.)

But the differences dwarf the resemblances:

  • Social Security has no schemer who plans to run away with the money.
  • The finances are public. Everyone can see what is happening.
  • It’s not a get-rich-quick scheme that appeals to people’s greed. It’s a social contract between generations that appeals to our desires to (i) not let our elders starve, and (ii) not starve when we get old.
  • The assumptions Social Security depends on are a continued healthy economy and continued faith in the social contract. A Ponzi scheme depends on an exponentially growing pool of suckers that eventually has to exceed the population of the world.
  • Consequently, a Ponzi scheme inevitably collapses, at great loss to the last round of investors. Social Security can keep going as long as its two underlying assumptions hold.

In short, anybody who refers to Social Security as a Ponzi scheme is just trying to piss people off, and has no intention of discussing the program seriously.

3. Chained CPI is a way to cut Social Security benefits, not a way to measure inflation more accurately.

Chained consumer price index is an alternative to the consumer price index (CPI), which is how the government measures inflation for purposes like the cost-of-living adjustment (COLA) in Social Security. The original selling point for chained CPI was that it is a more accurate measure of inflation, because it allows for the way that people change their decisions as prices change. That’s the point made in this video by Fix the Debt (a “non-partisan” billionaire-funded organization that coincidentally wants “lower tax rates” that increase the debt, but benefit billionaires).

Chained CPI produces with a slightly lower measure of inflation, which results in lower COLAS than the CPI we use now, and — given time and the magic of compound interest — substantially lowers Social Security benefits down the road. Those lower benefits happen gradually, so we can tell ourselves it will be painless for the elderly.

We can also tell ourselves that it won’t “cut” benefits. As the FtD video says:

Benefits won’t be reduced, they’ll continue to grow over time, and they’ll do so more accurately. Furthermore, what the critics aren’t seeing is that the current system pays everyone more than it intends to. So instead of overpaying everyone, perhaps it makes more sense to focus on the people that need the additional help.

Here’s the problem with that: If you really wanted Social Security COLAs to be “accurate”, you’d base them not on the basket of goods and services tracked by either the CPI or the chained CPI, but on the goods and services seniors actually need and buy (i.e., fewer baby diapers and more adult diapers). Economist Dean Baker explains:

The Bureau of Labor Statistics (BLS) has constructed an experimental elderly index (CPI-E) which reflects the consumption patterns of people over age 62. This index has shown a rate of inflation that averages 0.2-0.3 percentage points higher than the CPI-W.

The main reason for the higher rate of inflation is that the elderly devote a larger share of their income to health care, which has generally risen more rapidly in price than other items. It is also likely that the elderly are less able to substitute between goods, both due to the nature of the items they consume and their limited mobility, so the substitutions assumed in the chained CPI might be especially inappropriate for the elderly population.*

While the CPI-E is just an experimental index, if the concern is really accuracy, then the logical route to go would be for the BLS to construct a full elderly CPI.

So the CPI-calculated COLAs have probably been too low, not too high. Rather than “overpaying everyone”, we’ve been letting inflation slowly whittle Social Security benefits away. Switching to chained CPI allows inflation to whittle faster.

If the way we want to reduce the deficit is by cutting Social Security benefits gradually over time, let’s argue that case on its merits. Let’s not kid ourselves about “more accurate” measures of inflation.**

4. We could keep the program solvent far into the future by raising the cap on taxed wages.

Unless you’re in the the upper or upper-middle class, you may not realize that not all wages are subject to the Social Security tax. In 2012, any wages over $110,100 were not charged Social Security tax. As a result (according to economist John Irons of the Economic Policy Institute), 6% of wage-earners exceed the cap, and because some of them exceed it by quite a bit, the percentage of income untaxed by Social Security is much larger and growing:

Due to growing income inequality, the share of earnings above the cap has risen from 10 percent in 1982 to over 16 percent in 2006. This is because incomes have grown strongly at the top while middle incomes have stagnated.

This trend is expected to continue, meaning that a growing share of earnings will remain outside the tax base.

The cap also means that higher-income individuals pay a smaller share of their income in Social Security taxes than middle-class employees. Including the employee and employer shares of Social Security and Medicare taxes, earners in the middle fifth of the income distribution pay an average effective payroll tax of about 11 percent. In contrast, the top 1 percent of earners pay just 1.5 percent on average.

… According to the Social Security Administration, fully eliminating the cap on taxable earnings would be sufficient to fully close the projected shortfall.

* People who talk about changing your buying habits have clearly not dealt with any actual seniors. When doctors suggested my 89-year-old father was developing a peanut-butter allergy, I bought him jars of soy and almond butter to try instead. While cleaning out his cabinets after he went to a nursing home, I found them unopened.

** I wouldn’t tie benefits to inflation at all. I’d tie them to the median wage.

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How Big Was Your Work Penalty in 2012?

April 15, 2013 – 8:38 am

The screwiest thing about the American tax system is its work penalty: If you earn your money by working, you may well be paying higher taxes than somebody who makes the same amount of money without working, via dividends or capital gains. You’re certainly not paying less.

A simple example shows what I’m talking about: Suppose a single person has $40,000 of taxable income. (That’s the amount on  line 43 of the 1040 or line 6 of 1040EZ; in other words, you’ve already subtracted all your exemptions and deductions and you’re down to the amount you take to the tax table to figure out what you owe.) If s/he got that income without lifting a finger, say by letting dividends and capital gains distributions accumulate in a brokerage account, then the federal income tax bill is $6,000. (15%, in other words.)

But if that money came from working for wages, then the bill is $36 higher: $6036. So our hypothetical worker pays a $36 penalty for working rather than living idly off investment income.

The simple work penalty. That may not sound like much — unless any work penalty riles you as much as it riles me — but so far we’re just talking about the simple work penalty; as you’ll see, it gets worse the more things we take into account.

Here’s how you figure your simple work penalty: Multiply your taxable income by 15% to see what you’d pay if you made that money without working, then check your tax return to see how much you paid. (Or look up your income on the tax tables that start on page 79 of the 1040 instructions.) We’ve already seen that a simple work penalty starts at $40,000 for single people. It starts at $53,500 for a head of household or $80,000 for a joint-filing married couple.

No matter how little you make, you will never pay less than the idle guy who made the same amount from investments. When he figures his tax (on, say, the worksheet in the Schedule D instructions), one of the last lines has him figure how much he’d pay if he just used the regular tax tables like you do. If that amount is less, that’s what he owes.

Even the simple work penalty turns into real money if your wages are high. Say you’re a salesman working on commission and you had a really good year: Your taxable income is $100,000. If you’re single, you owe Uncle Sam $21,460. But the idle guy with $100,000 of taxable income from dividends and capital gains is still just paying 15%, or $15,000*. You’re penalized $6,460 because you made your money by working.

It gets worse. Anybody who has money to invest knows that the game is rigged even worse than that, because investors don’t owe any capital gains tax until they sell the thing that increased in value. So if an investor doesn’t want to pay tax, he just doesn’t sell.

Again, an example makes it real: Suppose a guy bought $10,000 of stock in Walgreens back in 1990 when it was selling at (a split-adjusted price of) $2.75. Ignore the dividends he’s been making all those years; the value of the shares themselves has gone up more than 17 times, so his 10K is now worth $177,300, making a gain of $167,300. How much tax has he paid on that gain over the last 23 years? Zero, because he hasn’t sold. If he never sells, and his heirs sell when they inherit, the tax is never paid. Even if he does sell and pay his 15% eventually, it doesn’t even out, because his money has been compounding tax-free all those years.

And what about payroll taxes? Payroll taxes apply to wages, but not to investment income. In general, wage-earners pay 1.45% of their wages in Medicare taxes and 4.2% in Social Security taxes**, for a total of 5.67%.

If you think of all that as just “taxes”, as money hoovered up by the government never to be seen again, then the work penalty is much higher. Let’s go back to our single guy with $40,000 of taxable income. Say he took the standard deduction of  $5950 and had no dependents other than himself, so he had $3800 of exemptions. So his gross wages were somewhere around $49,750 and he paid $2821 in payroll taxes. The investor paid zero, so that would make the gross work penalty $2857 — a much bigger chunk of change than the $36 simple work penalty. (Under the same assumptions, the $100K worker makes $109,750 gross and pays $6223 in payroll taxes, raising his gross work penalty to $12683.)

But that’s not really the right way to think about it, because some payroll taxes are social insurance payments that you will see direct benefit from. Unless you’re planning to have a fatal accident before you get old, paying money into Social Security now increases the benefits you will receive later, because (in spite of what conservatives tell you) Social Security is not going away. So the investor pays less Social Security tax than you, but he’ll also see less benefit down the road.

The same may not be true of Medicare, though, because it has all-or-nothing eligibility. In order to get coverage after 65, either you or your spouse has to pay into the program for ten years. After that, you get no additional coverage for paying in more.

So that 1.45% in Medicare taxes you paid in 2012 may well be garnering you no additional benefits over the non-paying investor (if, say, either or both of you already have your ten years in). So I think it’s entirely legitimate to include that in what we might call an adjusted work penalty. If we do, then the $40K worker pays a $757 work penalty and the $100K worker’s penalty is $8051.

By that definition, all workers, no matter how little they make, pay an adjusted work penalty. The investor with the same income will never pay a higher amount of income tax, and the worker pays an additional 1.45% in Medicare tax that may provide him/her no additional benefits down the road.

So suppose you work 30 hours a week, 52 weeks a year, at the $7.25 minimum wage, and you’ve been working for ten years or more. You have gross wages of $11,310. An investor whose only income is $11,310 of dividends and capital gains pays the same income tax you do, and in addition you pay $164 of Medicare taxes that provide you no additional benefit.

End the work penalty. Is that crazy or what? Why does our tax system penalize people for working rather than idly collecting dividends or sitting around owning things that go up in value?

Conservatives are always talking about ways to make the tax system “fairer”, by which they usually mean “flatter” —  they want to lower the tax rates paid by people who make the highest wages. (Why that is “fairer” is a mystery to me. I think a progressive tax system is fair.)

But eliminating the simple work penalty absolutely would make the system fairer: Stop treating different kinds of income differently. Wages, dividends, capital gains — they’re all income. Tax them the same. And beyond that, why not tax investment income for Social Security and Medicare?

* I know what you’re thinking: Wouldn’t the alternate minimum tax kick the investor’s taxes up? No, it wouldn’t. The AMT counter-acts excessive deductions and tax-free income, but doesn’t affect the advantages of dividends and capital gains.

** Until their wage income hits $110,100. In 2012, earnings higher than that paid no additional Social Security tax. The 4.2% was a special rate for 2012, temporarily reduced from the ordinary 6.2% (matched by another 6.2% from the employer).

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Mike Rice, Sean Hannity, and the Real American Discipline Problem

April 8, 2013 – 10:40 am

One of the week’s more interesting stories was the firing of Rutgers basketball coach Mike Rice after a video came out showing him physically and verbally abusing his players.

But that’s a sports story, and (in spite of being a major sports fan) I don’t usually cover sports on this blog. What makes the it something more, though, is the way that some conservative political pundits* made Rice a symbol of “old-fashioned discipline” — something they think our country needs. Sean Hannity said:

I’m watching this and I’m thinking, ‘All right, I don’t like this. … But on the other hand, I kind of like old-fashioned discipline.’ … Maybe we need a little more discipline in society.

And you know something? Sean is absolutely right. This is a story about discipline, and our country really does have a discipline problem. I could line up a bunch of conservative-pundit quotes about the failure of American discipline and agree with them completely, after I make one small adjustment: They’ve flipped everything upside down. 

Is the problem at the bottom or the top? The Sean Hannities, Michele Malkins, and Eric Bollings would have you believe that our national discipline problem is the laziness and dysfunctionality of the people at the bottom of the pyramid (represented in this story by the Rutgers players, most of whom probably come from poor families and need the scholarship Rice could take away from them), and that the Mike-Rices-in-charge need a freer hand to whip them into shape.

That’s why conservatives talk and act like this:

  • Tennessee’s one-party legislature** looks poised to cut welfare benefits 30% for families whose children aren’t doing well in school. Says the bill’s sponsor, “What my bill would do is put some responsibility on parents for their child’s performance.”
  • Seven red states already require drug tests for welfare recipients, and threaten those who fail with the loss of benefits. Other red states are considering such laws, in spite of the fact that the predictions haven’t panned out. The NYT summarizes: “a Florida law requiring drug tests for people who seek welfare benefits resulted in no direct savings, snared few drug users and had no effect on the number of applications, according to recently released state data.” In These Times notes: “the notion that low-income families are overwhelmingly riddled with substance abuse is one that researchers across the country have discredited time and time again.”
  • Republicans repeatedly opposed extending unemployment benefits in the wake of the Great Recession, arguing that people would not get out and find jobs without the threat of destitution. But research by the Federal Reserve Bank of San Francisco concluded that this effect is small. Overwhelmingly, the unemployed failed to find jobs because there were no jobs.
  • Again and again during the 2012 presidential campaign, conservative candidates warned against the poor becoming “dependent on government”. Mitt Romney’s 47% video was the most famous example, but far from the only one. Newt Gingrich pledged, “If the NAACP invites me, I’ll go to their convention and talk about why the African American community should demand paychecks and not be satisfied with food stamps.” Again, the implication is that large numbers of Americans prefer government handouts and would rather not work — and that benefit cuts are necessary to discipline them.

I agree that America faces a major discipline problem, but I see the lack of discipline at the top: the bankers, the billionaires, the CEOs. Like Mike Rice, they’re out of control and need to face the consequences of their actions.

The Rice video was seen by Rutgers officials months ago, and their response was a wrist-slap: Rice was suspended for three games and told not to do it again. Isn’t that typical of how things go in America?

  • Massey Energy CEO Don Blankenship treated safety violations in his coal mines as a cost of doing business. He stonewalled the EPA, dragged things out in court as long as possible, and then paid wrist-slap fines. In a very real sense, he murdered the 29 miners who died in the Upper Big Branch mine disaster. Is he in jail? On trial? Have we at least closed the barn door after the horse escaped? No, of course not. According to In These Times, Massey was sold to another corporation for $8.5 billion, Blankenship walked away with $12 million in severance and a $27 million deferred-compensation package, and “Congress has not passed any legislation tightening mine safety regulations.”
  • Dick Cheney has repeatedly and publicly claimed “credit” for the Bush administration’s program of waterboarding and other “enhanced interrogation” (the preferred euphemism for torture, which Ronald Reagan signed a treaty against). Waterboarding is an internationally recognized war crime for which we court-martialed our own soldiers in 1898 and executed Japanese soldiers after World War II. Is Cheney awaiting trial at The Hague? Don’t be silly. He has not even been shunned, either for his confessed crimes or for the gross incompetence of authoring our disastrous Iraq invasion. Wyoming Republicans invited him to speak at their state convention last spring. His daughter may well carry on the family legacy in future elections.
  • Our large financial institutions are essentially crime syndicates. They have knowingly laundered money for drug cartels, illegally foreclosed on people’s homes, and colluded to fix prices on credit card transactions. And that’s just what’s come out since they almost brought down the world economy and got billions of dollars in taxpayer bailouts. Are bankers in handcuffs doing the perp-walk? Maybe in benighted little countries like Iceland, but not here. Standard procedure is for the government to negotiate a settlement in which the banks pay a small fraction of their profits in fines, evidence of criminal behavior is never made public, and no one goes to jail.

I could go on; don’t even get me started on the Catholic clergy’s handling of their sex-abuse problem.

So yes, this is a story about discipline, but not about its failure: Mike Rice’s firing is a rare example of the success of discipline in America. For once, a misbehaving person in authority faced some consequences.

How did discipline succeed this time? Michele Malkin attributed Rice’s firing to “political correctness” and “the left-wing media makes a big fuss”.

In the real world, the relatively apolitical ESPN called public attention to the Rice video, and from there social media took over. Particularly damaging to Rice were the comments by professional athletes like LeBron James. And unlike, say, Goldman Sachs or Bank of America, Rutgers needs both applications from students and support from the legislature, so it has to care about its public image. (With the banks, the political pressure pushes the other way: bankers pressure politicians. Watching Congress interview banker Jamie Dimon, it was obvious who was the king and who were the courtiers.)

So in this unusual case, wrong-doing in high places got called to public attention, and the public had a way to make its power felt. Maybe that’s what we need more of if we’re going to fix our discipline problem. But Malkin disagrees:

I think there should be scrutiny of people who blow the whistle on these kinds of things.

Wussification. The weirdest response to the Rice firing came from another Fox host, Eric Bolling:

We’re in the midst of political correctness crushing our ability to teach kids, to discipline kids … I talk about the wussification of America, wussification of American men, this is it.

The idea seems to be that American kids — boys, at least — need authoritarian abuse to toughen them up. Sean Hannity seemed to agree:

Maybe we don’t have to be a bunch of wimps for the rest of our lives. My father hit me with a belt. I turned out okay.***

Again, I think they’ve got this upside-down. Who’s the wuss in the Mike Rice story? Mike Rice, that’s who. Atlantic writer Patrick Hruby explains:

Rice is lucky he’s not in jail, and luckier still that his players aren’t in jail for beating him half to death. Because if he acted the way he did in a bar, a classroom, or an office, there’s a good chance one or both of those scenarios would have taken place. But that’s the thing: Take Rice out of a practice gym, and it’s highly unlikely he would have behaved so badly. He did what he did because he’s a coach, and as a coach he had the power to do it. He knew his players wouldn’t fight back.

What’s wussier than that? We’re not “toughening” our boys by leaving them in the charge of men like Mike Rice. We’re teaching them that they should also try to gain institutional power, so that they too can push around guys they’d be afraid to face man-to-man.

Real men, real values. Hruby continues:

Forget sports culture. Forget macho culture. Like I said, this is a bullying story. And bullying is about abuse. Abuse and the misuse of power. Not to get all Spider-Man here, but in civilized society, great power means greater responsibility.

No Patrick, don’t apologize for getting all Spider-Man. That’s exactly the kind of “old-fashioned values” (Stan Lee — 1962) that American culture has lost and needs to recapture. Peter Parker becomes a hero precisely because he had an Uncle Ben in his life, not a Mike Rice.

The “real men” we need our boys to look up to are the ones who see their authority as a challenge to meet a higher standard of behavior, not an opportunity to live by a lower one.

* To his credit, Gov. Christie was having none of it.

** Full disclosure: My nephew works for the Democratic Caucus in the Tennessee Senate, which controls a mere 7 of the 33 seats.

*** Jon Stewart questioned this conclusion: “Seriously? You’re OK? Have you seen your show? Cause it seems like the show of a guy who was hit with a belt as a child.”

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A Hotter Planet is in the Pipeline

March 18, 2013 – 11:04 am

If you want to construct a simple, suitable-for-casual-conversation argument in favor of the Keystone XL Pipeline, you probably already know everything you need. The ideas are easy to grasp, and the people who want you to construct such arguments have a lot money to get their message out. Here are the pieces:

  • The oil sands are just sitting up there in Canada. BP says: “The province of Alberta contains recoverable oil sands reserves of approximately 170 billion barrels, the third largest reserves in the world.”
  • Giving our oil money to Canada makes a lot more sense than giving it to Saudi Arabia or Iran or Venezuela. For a lot of reasons: Of all the people in the world, Canadians are the ones most likely to send that dollar right back to us by buying something we make or coming here on vacation. They’re also probably not going to use the money to fund terrorism or anti-American propaganda. And we don’t have to worry much about them shutting the oil off to manipulate us or punish us politically.
  • Building the pipeline would employ a lot of people. Paul Ryan’s budget claims (page 48) “20,000 direct jobs and 118,000 indirect jobs.” But the construction-job figure appears to be inflated by a factor of about 10, and the “indirect jobs” are just wild guess.

Probably you know that the case against the pipeline has something to do with global warming, but unless you’ve gone out of your way to study the issue, the pieces of that argument don’t come quickly to mind and aren’t as easy to assemble. It’s not actually a difficult argument, it just doesn’t have as much money behind it, so you don’t have it constantly in front of you.

So let’s start at the beginning.

Global warming is real. It’s not “controversial” or “disputed” in any genuine scientific sense. People who profit from selling fossil fuels have spent a lot of money to buy political controversy and to dispute the scientific results in the media, but that’s different from there being any real scientific controversy about whether the planet is getting hotter, whether greenhouse gases in the atmosphere are causing it, or whether burning fossil fuels puts more greenhouse gases into the atmosphere.

Our solar system already gives us a clear example of a runaway greenhouse effect: Venus, which otherwise is the planet that most resembles Earth. The atmosphere of Venus is 96% carbon dioxide, and its surface temperature is over 800 degrees Fahrenheit — even hotter than the hottest parts of Mercury, which is much closer to the Sun. Nobody’s saying that lead is going to start boiling here on Earth, but the greenhouse effect is not some speculation out of science fiction. It’s happening on the next planet over.

There’s a time lag between putting more carbon in the atmosphere and the Earth getting hotter. It’s not like the thermostat on your furnace. (It’s more like putting on a sweater that you can’t take off.) So we can’t wait until apocalyptic things start happening and then say, “Damn. I guess we better do something about this.” If tomorrow, we stopped burning fossil fuels completely — not that anybody expects that to happen — the planet would keep getting hotter for the next several decades.

Estimating how much carbon results in how many degrees warmer how fast is where the science gets iffier. (This is where there is honest debate and more research is needed. Of course, the fossil-fuel people and their minions want to cut off this research, so they can keep exploiting the uncertainty.) In general, though, this graphic sums the best guesses we have:

So, for example, carbon already released (say, by that driving vacation you took ten years ago) is going to increase the global temperature by 1.5 degrees Centigrade, or about 2.7 degrees Fahrenheit. A carbon budget that would keep further warming down to 2 degrees C (3.6 F) beyond that is already starting to look impossible.

And this is the mainline scenario, not the worst case. Short of Venus, it’s hard to know what the worst case is, because we could at some point set off some feedback loop we currently know nothing about. At some point, for example, the methane frozen into the Siberian permafrost starts to evaporate into the atmosphere. Methane is a greenhouse gas, so after that the hotter it gets the hotter it gets.

If we don’t want to have an ecological catastrophe, a lot of fossil fuels will have to stay in the ground. Nobody wants to hear this, and people who hear it have a way of forgetting. But take another look at that graphic: Just burning the gas, oil, and coal that corporations already list on their books will take us to a point about 12 Fahrenheit degrees warmer than we are now. That’s about the difference between Chicago and Atlanta, or Atlanta and Baghdad. The entire state of Florida would need a serious seawall, and hurricanes would hit New York or Boston every few years. I’m not sure what happens to the cornfields of Iowa or the vineyards of California, but I bet it’s not pretty.

The drill-baby-drill scenario, where we find every last hydrocarbon on the planet and burn it, is much, much worse.

If you’re going to leave any oil in the ground, the Canadian oil sands are a good choice. While not as bad as coal for generating energy in general, oil sand is a carbon-intensive way to produce liquid fuels like gasoline. There’s some debate about how much worse than ordinary crude oil it is, with estimates running from 12% worse to 22% worse. Another way to look at that: If carbon is the limiting factor on how much gasoline the world can have, producing five gallons of gas from oil sands might prevent us from producing six gallons from crude oil somewhere else.

Also, the sands are in the early stages of development; leaving them in the ground is a much easier decision now that it will be after we’ve spent a bunch of money to build a pipeline and install other infrastructure. And they’re in a rich country. (Imagine telling a poor country that its people will have to starve rather than develop known energy resources.)

What’s Plan B? Pipeline advocates want to take that argument off the table by saying that the oil sands are going to be developed anyway. At its worst, this is a defeatist the-planet-is-already-hosed-so-we-might-as-well-live-it-up-now argument.

But even ignoring that, the argument is disingenuous. The point of building the pipeline is that it makes developing the oil sands more economical. No energy deposit gets completely exploited — there’s always some oil at the bottom of the well that is recoverable, but only at a higher price. So building the pipeline clearly changes how much of the oil sand will be exploited.

And finally, the economic projections are based on a world that has no carbon tax or cap-and-trade system, which is another way of saying that we’re acting as if changing the climate had no cost.

But if the Canadian oil sands are going to be burned in their entirety (or close to it), what is going to be left in the ground? And if the answer is nothing, then what’s the plan for mitigating the damage? What’s the plan for relocating all the Bangladeshis when that country is underwater? How high does the seawall around Florida have to be? What’s the food-supply plan when Iowa turns into a desert and the ocean is too acidic to support fish?

Pipeline advocates would have you believe that the opponents are being impractical, that even if you believe in climate change (i.e., if you believe in science), this is not the place to take a stand.

So: where is the place to take a stand? And will it still be above sea level when we get there?

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