Eventually this may get resolved by President Obama claiming the power to act on his own, as this NYT op-ed advocates. It’s a scary thought: Democracy becomes so dysfunctional that we need unilateral executive action to avoid default.
A father of daughters explains why women have trouble breaking into the mainstream: It all goes back to dogs and smurfs.
It’s been fascinating to watch the media react to the Norway attacks. They instantly assumed Islamic terrorism. And then when it turned out to be the exact opposite — an Islamophobic nativist — the follow-ups were like “Oh, sorry. We thought it was terrorism.”
As all the Murdoch properties circle the wagons to defend against the phone-hacking scandal, it becomes clearer than ever that (in Jay Rosen’s words) “News Corp is not a news company at all, but a global media empire that employs its newspapers – and in the US, Fox News – as a lobbying arm.”
For nearly two years, Republicans have been complaining that half of Americans pay no income tax. (Often they overstate this as “pay no tax“, ignoring the Social Security and Medicare payroll taxes, plus state and local taxes.) Cantor, Bachmann and others have been singing this tune recently.
Nobody remembers: Cutting low-wage families’ income tax to zero or near-zero was one of the talking points for the Bush tax cuts. In his 2003 State of the Union, President Bush promised
A family of four with an income of $40,000 would see their federal income taxes fall from $1,178 to $45 per year.
But conservative rhetoric turns on a dime, and now those families are moochers and deadbeats. People over 55 should remember them when Paul Ryan promises full Medicare benefits. Conservatives promise you something, then vilify you later for taking it.
As the Captain America movie opens, the Mighty God King blog speculates on Steve Rogers’ Depression-era communist upbringing. Underneath that jingoistic costume, the Captain is a liberal. He even provided a Sift quote once.
Given the current majority on the Supreme Court, the only way to overturn Citizens United and get rid of corporate personhood in general is to amend the Constitution. That may seem like a quixotic quest, but we’ll never know unless we try. This issue unites liberals, libertarians, and even parts of Tea Party. Who knows where it could go?
Welcome to the new WeeklySift.com. This week the Weekly Sift moves to weeklysift.com. Simultaneously, I’ve changed (and, I hope, improved) the design of the blog. But the content, philosophy, and purpose of the Weekly Sift is not changing.
Meet ALEC.How did those new conservative governors all suddenly come up with the same detailed agenda after they took office? By using the model laws that the corporations who run the American Legislative Executive Council had already written behind closed doors. Now those model laws have all been leaked.
Short Notes.Will 3-D printers someday kill the last of the manufacturing jobs? Nobody but a reporter comes to Sarah’s premier. Krugman, Mahr: If you just noticed how crazy the Republicans are acting, where have you been? Fox forgets 9-11. A song explains fracking. Stephen Colbert explains the Rupert Murdoch scandal. And more.
This Week’s Challenge.The Wisconsin recall elections are mere weeks away, and the good guys are being outspent.
This week I moved the Weekly Sift to its new home at weeklysift.com. I’ve been meaning to do that for a while, and I’ve simultaneously included changes that I hope make the blog easier to find, more accessible to new readers and commenters, and easier to navigate.
People who get the Weekly Sift directly from me by email shouldn’t notice any difference. During a transition period, I’ll post weekly summaries at the old URL. If you’re reading via Google Reader or some other RSS subscription, this would be a good time to change the subscription to weeklysift.com.
If you read the Sift online, the biggest change you’ll notice is that each week’s Sift is now divided into 4-6 separate posts that come out more-or-less simultaneously. The last post of each week is the Weekly Summary, which looks like the header of the old-style Sifts, and should sit on top of the blog all week. The new structure is intended to make it easier for people to find, link to, forward, or comment on the specific article they want.
Undoubtedly there will be glitches as I deal with new tools and settings. (The blog also moved from Blogspot software to WordPress software, which should be invisible to the reader.) If anything doesn’t work, either leave a comment on the blog or write to me at weeklysift at gmail.com.
Some things are definitely not going to change: the purpose, quantity, and integrity of the content. The Sift still comes out on Mondays and still has a target total length of 3000 words (not counting the summaries). I haven’t changed my target audience, my writing style, or my point of view.
In one memorable scene from The Matrix, a boy apparently bends a spoon with his mind, and then gives Neo advice on how it’s done: by realizing that there is no spoon.
At first “there is no spoon” sounds like mystic mumbo-jumbo, but eventually you come to understand that it is literally true: The world the boy and Neo share is a computer simulation, and the apparent spoon is just a pattern of data. If you believe it is a solid object, you expect it to obey physical laws and not bend. But if it is a pattern of data, why couldn’t it be a different pattern of data — a bent spoon — instead?
As you watched that scene, you may not have realized you were learning about economics, but you were. If you need that idea spelled out more clearly (as I did) you should read a down-to-earth little book that is available for free on the internet: The Seven Deadly Innocent Frauds of Economic Policy by Warren Mosler. (Don’t let the blank first page confuse you. Keep scrolling.)
The deadly frauds, which very serious pundits and politicans tell you every day (innocently, because they don’t know any better) are:
The government must raise funds through taxation or borrowing in order to spend. In other words, government spending is limited by its ability to tax or borrow.
With government deficits, we are leaving our debt burden to our children.
Government budget deficits take away savings.
Social Security is broken.
The trade deficit is an unsustainable imbalance that takes away jobs and output.
We need savings to provide the funds for investment.
It’s a bad thing that higher deficits today mean higher taxes tomorrow.
Now, chances are all seven of those seem like common sense to you, just as the spoon looked very solidly spoonlike to Neo. What people have trouble grasping, Mosler explains, is what dollars are: Dollars are numbers on a spreadsheet at the Federal Reserve. Dollars are a pattern of data, and (like Neo’s spoon) could just as easily be a different pattern of data.
When, for example, the government pays my Dad’s monthly Social Security benefit, the Fed just increases the balance in the account of Dad’s bank. No object of any real-world value moves or changes.
Where else do we see this happen? Your team kicks a field goal and on the scoreboard, the score changes from, say, 7 points to 10 points. Does anyone wonder where the stadium got those three points? … Do you think all bowling alleys and football stadiums should have a “reserve of points” in a “lock box” to make sure you can get the points you have scored? …
Just keep this in mind as a starting point: The federal government doesn’t ever “have” or “not have” any dollars. It’s just like the stadium, which doesn’t “have” or “not have” a hoard of points to give out. When it comes to the dollar, our government, working through its Federal agencies, the Federal Reserve Bank and the U.S. Treasury Department, is the score keeper.
Not bankrupt. So Mosler immediately discards any notion that the U. S. government might “go broke”. Paying interest or redeeming a bond means changing the numbers in the spreadsheet, not coming up with real assets that are conserved by physical laws.
Ditto for parts of the government going bankrupt. If the Social Security Trust Fund “runs out”, that just means that the corresponding entry in the spreadsheet is zero and about to go negative, not that some real cupboard is now bare.
Taxes and inflation. The purpose of taxing is not to acquire assets that the government needs to fund its programs (because the government never has or doesn’t have any dollars). It is to take dollars out of circulation so that they don’t cause inflation.
Inflation happens when the real economy isn’t able to produce enough goods to satisfy all the people who have money to spend. So consumers bid up the price of scarce goods and businesses bid up the wages of scarce workers.
Seen any scarcities of goods or workers lately? There are occasional bottlenecks (like gasoline), but in general the economy has plenty of room to produce more goods to cover more dollars. There is no good reason not to create those dollars so that more people can work and spend.
What about saddling future generations with government debt? Again, the problem is our mis-framing of what money and debt means: Everything produced in the future will be consumed in the future, not sent back in time to pay for our spending today.
Some day it will be our children changing numbers on what will be their spreadsheet, just as seamlessly as we did, and our parents did, though hopefully with a better understanding!
There are many more quotable passages, but I’ll limit myself to this one, where Mosler answers the people who think that we need to change Social Security because the worker-to-retiree ratio is shrinking.
Let’s look at it this way: 50 years from now when there is one person left working and 300 million retired people (I exaggerate to make the point), that guy is going to be pretty busy since he’ll have to grow all the food, build and maintain all the buildings, do the laundry, take care of all medical needs, produce the TV shows, etc. etc. etc. What we need to do is make sure that those 300 million retired people have the funds to pay him??? I don’t think so! This problem obviously isn’t about money.
Mosler’s book falls into three parts: the explanation of the seven frauds (56 easy-to-read pages), the story of his career as a banker and fund manager (entertaining if you like business stories, but not necessary to get the point), and his prescription for the economy (which I’ll cover next week).
Another common-sense story that explains money-supply issues is Paul Krugman’s 1998 article about a baby-sitting co-op whose “money” consisted of coupons the participating parents traded when they baby-sat for each other.
Now what happened in the Sweeneys’ co-op was that, for complicated reasons involving the collection and use of dues (paid in scrip), the number of coupons in circulation became quite low. As a result, most couples were anxious to add to their reserves by baby-sitting, reluctant to run them down by going out. But one couple’s decision to go out was another’s chance to baby-sit; so it became difficult to earn coupons. Knowing this, couples became even more reluctant to use their reserves except on special occasions, reducing baby-sitting opportunities still further.
In short, the co-op had fallen into a recession.
They got out of the recession by printing and distributing more coupons, which worked because their “economy” was willing and able to produce more nights-out and more hours of babysitting.
A related discussion this week has concerned a novel solution to the debt-ceiling “crisis”. The Pragmatic Capitalism blog claims that the Treasury, which unlike the Fed is completely under the President’s control, has unlimited authority to produce palladium coins. Treasury could strike a small coin, stamp $1 trillion on it, and use it to redeem $1 T worth of bonds, thereby creating $1 T of space under the debt ceiling.
Independent of whether this is good economic policy, it completely avoids the current hostage situation. Even skeptics like Matt Yglesias are coming to believe that this would work.
The Republican landslide of 2010 swept into office governors like Scott Walker of Wisconsin, Rick Scott of Florida, Rick Snyder of Michigan, Tom Corbett of Pennsylvania, and John Kasich of Ohio. All replaced Democrats except for Scott, who replaced moderate Republican Charlie Crist.
All five of these governors ran fairly vague campaigns about cutting waste and shrinking government, but after the election each hit the ground running with a detailed and radically conservative agenda — coincidentally, the same agenda.
Some of that agenda was predictable from campaign rhetoric: budget cuts in education and medical care, tax cuts for corporations, and loosening regulations that protect consumers and workers from corporations. Voters may not have guessed the specific cuts from the ads they saw, but anybody who has been paying attention knows that when Republicans say “waste” they mean schools and medical care. And when they say “growth” or “jobs” they mean give-aways to corporations.
Strangely, though, much of the one-size-fits-every-state agenda wasn’t even hinted in the campaigns: breaking the state employee unions, for example. It is predictable that governors who want to cut education will drive a hard bargain with teachers. But in November nobody was talking about taking away collective bargaining rights or de-certifying unions. And then suddenly in February they all were.
Hardly anybody ran on those issues. But on Day 1, Republicans were ready to move on them.
Even the predictable parts of the unified agenda were being pursued in suspiciously similar ways. All over the country, conservative governors decided to go big, hit hard, and push their opposition to the wall. At one point Illinois was hosting refugee legislators from both Wisconsin and Indiana.
This level of similarity would make sense if there had been some public Contract With America II that they had all signed. But there wasn’t.
Clearly, governors (or leaders of Republican legislatures in states with Democratic governors) were not calling in their local advisors and having independent conversations that all happened to reach the same conclusions.
ALEC has existed since conservative activist Paul Weyrich founded it in 1979, and it has been written about for years. The American Radioworks piece described how the private prison industry works through ALEC to build their market by increasing prison sentences.
But [Corrections Corporation of America] does more than chat up lawmakers at ALEC meetings. On top of its membership dues and contributions to help pay the bills for ALEC meetings, the prison company pays two thousand dollars a year for a seat on ALEC’s Criminal Justice Task Force. That panel writes the group’s “model” bills on crime and punishment. Until recently, a CCA official even co-chaired the task force.
… Among ALEC’s model bills: mandatory minimum sentences; Three Strikes laws, giving repeat offenders 25 years to life in prison; and “truth-in-sentencing,” which requires inmates to serve most or all of their time without a chance for parole. ALEC didn’t invent any of these ideas but has played a pivotal role in making them law in the states, says [Edwin] Bender of the National Institute on Money in State Politics.
The piece ended with a quote from William Dickey, the former head of Wisconsin’s prison system:
I’ve always understood political people as having differences of opinion — tough on crime, soft on crime. But I’ve usually thought that whatever views were being held in that debate, they were sincerely arrived at. And to discover that there’s a group pushing criminal justice policy not because it’s in the public interest, but because it’s a way to make money, is disappointing to me.
But that’s just one industry. Recently we got our first look at the full scope of ALEC’s activities when the Center for Media and Democracy got its hands on 800 pieces of model legislation ALEC has written. You can find them on the web site ALEC Exposed.
The major pieces of the Walker/Scott/Snyder/Corbett/Kasich agenda are all there. (For example, the model “Public Employee Freedom Act” contains the union-busting provisions, and the “Voter ID Act” the vote-suppression provisions — including the ones that make no sense, like saying that an expired driver’s license does not establish your identity.)
There is, I rush to point out, nothing illegal about this. Any one can write model legislation and try to get a legislator to propose it. Liberal groups do it too. What is sinister, though, is the secrecy. Corporations have managed to remove their fingerprints from the laws they have written.
Whether an environmental group is pushing higher pollution standards or an polluting industry seeks lower ones, the public has a right to know where its laws are coming from, and what interests are being served.
You get an idea of the founding philosophy of ALEC from this 1980 clip of founder Paul Weyrich: “I don’t want everybody to vote. … Our leverage in the elections quite candidly goes up as the voting populace goes down.”
3D printers are seriously cool, science-fictiony things. But they also will be very disruptive. What happens to manufacturing and shipping jobs — or to capitalist economics in general — when you can turn out a crescent wrench like this?
One attempt to answer this question is Peter Frase’s vision of Anti-Star Trek. In other words, what happens if you have Star Trek‘s replicators and limitless clean energy, but you’re not willing to embrace the Federation’s socialist economy? Frase pictures a future capitalism based not on production, but on collecting rents on intellectual property. It’s not pretty.
Another attempt to answer similar questions is Martin Ford’s The Lights in the Tunnel, which I discussed in May.
I’m ready to stop writing about Sarah Palin, but this is too good: A worshipful documentary about her, The Undefeated, opened Friday at 10 theaters in conservative hotspots. Atlantic’s associate editor Conor Friedersdorf went to the midnight premier in Orange County CA, where he imagined he would get fascinating quotes from the rabid Palinistas.
There weren’t any. Two women came in because Harry Potter was sold out. They soon left. A couple came to make out in the back row. They soon left too. Friedersdorf wound up interviewing the manager. “In hindsight,” he asked, “do you wish you’d had one more screen showing Harry Potter?”
Paul Krugman to his fellow pundits: If you’re just now noticing that the Republican Party has gone crazy, you’re part of the problem.
Bill Mahr says a lot the same thing to all the middle-class people who vote Republican, but he’s much funnier:
In this remarkable clip, Fox’s Eric Bolling not only claims “President Bush never fear-mongered like this,” but when another panelist brings up terrorism Bolling says: “America was certainly safe between 2000 and 2008. I don’t remember any terrorist attacks on American soil during that period of time.”
So, Eric, does 9-11 ring any bells?
Vodpod videos no longer available.
If only we could reduce all our issues to music videos like The Fracking Song.
BTW, the latest research on fracking indicates that water wells near fracked gas wells do get contaminated with methane, but not with the trade-secret fracking chemicals themselves. The problem might be as simple as bad piping. Because fracking wells are so deep, there’s a lot more pipe for gas to leak from.
Conservatives are still trying to pin the housing bubble on government rather than Wall Street, and they’re still wrong.
The Rupert Murdoch scandal is exactly the kind of thing I need Stephen Colbert to explain to me:
The Wisconsin recall elections are coming down to the wire, and previously unheard-of amounts of money are being spent. So far, the Republican incumbents are out-raising their challengers, with who-knows-how-much last-minute corporate money waiting in the wings.
You can contribute to the challengers through Act Blue.
Is Obama on Our Side? What if President Obama isn’t being out-negotiated by Republicans? What if he’s getting what he wants?
The Hard Line. The Republican inclination not to compromise goes all the way down to the grass roots, where three kinds of fundamentalism are replacing the 20th-century conservative’s respect for the status quo.
What “Spending” Really Means. Cutting government spending sounds good until you have to get specific. Do we want safe food and fire engines that work?
Short Notes. Fiore’s biting animations. We had a revenue crash, not a spending orgy. New light bulbs and solar panels. The debt ceiling is constitutional. And Ohio says that poll workers don’t have to be helpful.
This Week’s Challenge. As I redesign the Weekly Sift blog, now is a good time to make your suggestions.
When Barack Obama’s 2008 landslide carried such unlikely states as North Carolina and Indiana, and swept in large majorities in Congress, many progressives imagined a transformational presidency like FDR’s. Katrina Vanden Heuval wrote:
[F]uture historians may well view Barack Obama’s victory as the end of the age of Reagan and the beginning of something substantially new.
So far, it hasn’t worked out that way.
Not that President Obama hasn’t had accomplishments. The Bush economic crisis did not become a second Great Depression, as it threatened to do. With all its compromises, the Affordable Care Act is still a historic step in the right direction. Obama’s two appointments have slowed down the rightward drift of the Supreme Court. In thousands of ways that don’t make headlines, regulatory agencies have gone back to protecting the American people. On gay rights, President Obama has not led, but at least he has not stood in the way. The Iraq War has continued to wind down, our relations with other nations in general are less belligerent, and we finally nailed Osama Bin Laden.
That’s not nothing. But by now the list of liberal disappointments has gotten long.
Trivial Wall Street reforms. Frank Rich summed it up:
What haunts the Obama administration is what still haunts the country: the stunning lack of accountability for the greed and misdeeds that brought America to its gravest financial crisis since the Great Depression. There has been no legal, moral, or financial reckoning for the most powerful wrongdoers. Nor have there been meaningful reforms that might prevent a repeat catastrophe.
No public option. Given the public option’s popularity, a great speech might have made a difference to wavering Democrats in the Senate, but Obama didn’t give one.
Ratifying Bush’s power grabs. On Inauguration Day, the new president had a chance to define the Bush administration as an aberration and turn the corner. Obama could even have enforced the law and prosecuted Bush officials for ordering torture. Instead, he let his initial effort to close Guantanamo fail, and has continued to practice and has systematically defended in court many of the Bush administration abuses of power.
Afghanistan. To be fair, Candidate Obama portrayed Afghanistan as the good war that got ignored because we fought the bad war in Iraq. So Afghan escalation shouldn’t have been a surprise. But we still have no coherent goal or exit strategy.
Global warming. In a recent article in Rolling Stone, Al Gore credits Obama for at least starting to take action, but then says:
President Obama has thus far failed to use the bully pulpit to make the case for bold action on climate change. After successfully passing his green stimulus package, he did nothing to defend it when Congress decimated its funding. After the House passed cap and trade, he did little to make passage in the Senate a priority. Senate advocates — including one Republican — felt abandoned when the president made concessions to oil and coal companies without asking for anything in return. He has also called for a massive expansion of oil drilling in the United States, apparently in an effort to defuse criticism from those who argue speciously that “drill, baby, drill” is the answer to our growing dependence on foreign oil.
Taxes. When Republicans wouldn’t extend the Bush tax cuts just for the middle class, Obama had a perfect place to make a popular stand. Imagine: “I wanted to keep your taxes low, but the Republicans blocked me to protect the millionaires.” Instead he agreed to extend all the Bush cuts — and didn’t even get a debt-ceiling increase written into the deal.
And now, he seems ready to make significant concessions on Social Security and Medicare in those debt-ceiling negotiations he might have avoided. Like the public option only moreso, Social Security and Medicare are popular. There’s a significant rabble waiting to be roused, if a silver-tongued president were so inclined. So far, nothing.
Explanations. In the beginning, progressives explained these disappointments with some combination of 1) He’s doing the best he can given political reality and the power of the special interests and 2) He’s a bad negotiator who compromises when he doesn’t have to. Lately, though, a third explanation is getting louder and louder: 3) Maybe he’s not really on our side.
Bringing up Explanation 3 — even to deny it — is the surest way to start a blood feud on a liberal web site like Daily Kos. Emotions run high. Some liberals feel strongly that Obama has betrayed them, while others are just as strongly attached to him.
The problem is: All three explanations work, and each explains things the others can’t. For example, I think Obama was genuinely surprised by the popular resistance Republicans raised to closing Guantanamo. (Scary, scary terrorists were going to be housed in flimsy jails down the street from you.) Otherwise, why make a grand promise only to back off of it? And I believe he did (foolishly) expect Republicans to negotiate in good faith on vital issues like the debt ceiling.
True intentions. In spite of all the socialist and Marxist and big spender rhetoric from the Right, what if Obama has always been a centrist? Left and Right alike imagined that the centrist positions he campaigned on were masking a deeper progressive agenda, but what if they weren’t?
From the beginning, the role Obama has written for himself has been to let liberals and conservatives fight it out in Congress, and then to come in at the end with a compromise. (The problem has been that liberals are largely shut out of the corporate media — when was the last time you saw Dennis Kucinich on TV? — so the public debate has been between the most moderate Democrats and the most conservative Republicans, with Obama coming in at the end to make a center-right compromise rather than a left-right compromise.)
I think the way he has handled entitlement reform tells us a lot. The Simpson-Bowles Commission Obama appointed to study long-term deficit issues was stacked from the beginning. (Digby kept calling it “the Catfood Commission”.) When the commission was appointed, Unsilent Generation posted:
Despite protestations to the contrary, the commission exists primarily to make cuts to Social Security and Medicare. The commission’s slant is evident from the choice of its two co-chairs: former Wyoming Republican senator Alan Simpson, a long-time foe of entitlements, and Erskine Bowles, the middle-right former Clinton chief of staff.
It should have surprised no one when Simpson called Social Security “a milk cow with 310 million tits“. And it should have surprised no one that the Commission recommended Social Security and Medicare cuts.
Presidents do this kind of spadework to cover unpopular actions they want to take later. It’s where you can see presidential intention in its purest form. Obama has believed all along that Social Security and Medicare need to be cut. So while he’s not likely to get on board with the Ryan privatization plan, he’s also not likely to make a bold stand against cuts that he’s been maneuvering towards from the beginning.
Framing is another place you can see presidential intention at work. The other side can force you to accept deals you don’t like, but they can’t make you repeat their deceptive rhetoric. Recently, though, Obama has said things like:
Government has to start living within its means, just like families do. We have to cut the spending we can’t afford so we can put the economy on sounder footing, and give our businesses the confidence they need to grow and create jobs
That’s three of the right’s favorite economic fallacies in just two sentences. No, the government shouldn’t budget the way families do; on the contrary, trying to balance the budget in times of economic distress is a recipe for deepening the slump. Spending cuts right now wouldn’t “put the economy on sounder footing.” They would reduce growth and raise unemployment. And last but not least, businesses aren’t holding back because they lack confidence in government policies; they’re holding back because they don’t have enough customers — a problem that would be made worse, not better, by short-term spending cuts.
My conclusion. Consider the possibility that Obama is a Clintonian centrist whose liberal actions have been forced on him by events. I don’t think he’s a bad guy or a traitor to the cause. I just don’t think he’s ever been a progressive.
Deep down, I think Obama wants to be the president who steers the center course — fixing the long-term growth in entitlement spending without gutting the safety net. The ACA is part of that vision, because health-care inflation is the main long-term fiscal threat, and the private sector is never going to stop it. The near-depression forced a half-hearted stimulus on him, but expanding government services is not his fundamental inclination.
He never said it was.
Conservative columnist Ross Douhat on the deficit negotiations: “The not-so-secret secret is that the White House has given ground on purpose.”
The Weekly Sift 
