Tag Archives: Paul Krugman

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The trillion dollar coin explained – sort of

When I started hearing about the possibility of the treasury minting a trillion dollar coin which could end all the endless debates about the debt ceiling, I thought it was a joke.  Turns out, that is only partly true.  Here are two views of the platinum coin.

The first is Neil Irwin’s as posted on the Wonkblog.

I’ll lay out this econo-pundit’s conclusion upfront: I hate the platinum coin idea. But if there is no resolution of the debt ceiling through the legislative process, I hate some of the alternatives more.

The issue, for those who need a refresher: To avoid running into the debt ceiling in the next couple of months, the Treasury secretary could exploit a legal loophole, create a platinum coin, assign it a value of $1 trillion or some other very high number, and deposit it at the Fed, thus enabling the government to carry out its previously promised tax and spending policies without broaching the legal cap on debt issuance.

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To back up a minute, it is important to understand what the debt ceiling does, and why it is problematic. Congress passes laws to spend money: This many dollars for fighter aircraft, Social Security benefits paid according to such and such formula, and so on. It passes laws to enact a tax code. And the difference between that spending and the money raised in taxes the government funds by issuing debt. But Congress also has a third constraint: An overall ceiling on how much debt the Treasury can issue. In the past, Congress has raised that ceiling to whatever it needed to be to match the previously approved taxes and spending as a matter of course.

Now, House Republicans are viewing the debt ceiling differently. They are treating the debt ceiling–and the need to raise it–as a lever through which to try to win battles over spending that they lost in previous negotiations. They want to not pass an increase to the debt ceiling unless they get some major concessions from Democrats on cutting spending—concessions that Democratic senators and the White House say are non-starters.

So the idea of the trillion dollar coin would be to put this whole impasse to rest.  Irwin goes on to explain what the coin would not do.

A couple of the widespread objections don’t hold water. So long as the Federal Reserve does its job, the platinum coin would not be inflationary. In the current ultra-low interest rate environment, the Treasury depositing a $1 trillion coin at the Fed would not affect the supply of money in the broader economy any differently from it issuing $1 trillion in Treasury bills. Nothing about the platinum coin would prevent the Fed from hiking interest rates when it sees an inflationary threat on the horizon.

That’s not to say a platinum coin gambit would be much fun for the Fed. Chairman Ben Bernanke and New York Fed president Bill Dudley would face a moment of truth, and scores of Fed lawyers would be working overtime, as the central bank had to decide whether to treat the $1 trillion coin as a legal deposit. The Fed in general hates to end up in the middle of political disputes, and this would be a highly uncomfortable spot.

On the other side is Paul Krugman who begins by explaining the whole debt ceiling business.

Where does the debt ceiling fit into all this? Actually, it doesn’t. Since Congress already determines revenue and spending, and hence the amount the Treasury needs to borrow, we shouldn’t need another vote empowering that borrowing. But for historical reasons any increase in federal debt must be approved by yet another vote. And now Republicans in the House are threatening to deny that approval unless President Obama makes major policy concessions.

It’s crucial to understand three things about this situation. First, raising the debt ceiling wouldn’t grant the president any new powers; every dollar he spent would still have to be approved by Congress. Second, if the debt ceiling isn’t raised, the president will be forced to break the law, one way or another; either he borrows funds in defiance of Congress, or he fails to spend money Congress has told him to spend.

So in reality, Congress would just have to authorize borrowing money that they have already said could be spent.  And part of the issue is that not enough people are working and paying enough taxes to create enough revenue.  In some ways you can understand the Republicans who want to set a fixed amount for a budget and then make everything fit.  No borrowing.  But then you have things like Hurricane Sandy and extra spending for the Bush wars for which no revenue was ever raised, and etc., etc. and we end up either cutting things no one wants to cut or borrowing.  Back to Krugman.

Finally, just consider the vileness of that G.O.P. threat. If we were to hit the debt ceiling, the U.S. government would end up defaulting on many of its obligations. This would have disastrous effects on financial markets, the economy, and our standing in the world. Yet Republicans are threatening to trigger this disaster unless they get spending cuts that they weren’t able to enact through normal, Constitutional means.

Republicans go wild at this analogy, but it’s unavoidable. This is exactly like someone walking into a crowded room, announcing that he has a bomb strapped to his chest, and threatening to set that bomb off unless his demands are met.

Which brings us to the coin.

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Here’s how it would work: The Treasury would mint a platinum coin with a face value of $1 trillion (or many coins with smaller values; it doesn’t really matter). This coin would immediately be deposited at the Federal Reserve, which would credit the sum to the government’s account. And the government could then write checks against that account, continuing normal operations without issuing new debt.

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But wouldn’t the coin trick be undignified? Yes, it would — but better to look slightly silly than to let a financial and Constitutional crisis explode.

A downgrade of the United States credit rating again will end up costing us in interest which seems to me to defeat the purpose since we will probably have to borrow more to pay extra to borrow.  Maybe enough Republicans will join with enough Democrats to raise the ceiling to a trillion dollars and we won’t need the magic coin.  This is what Irwin is hoping for.

The platinum coin gambit could be terrible for the U.S. government’s long-term standing as a premier destination for global capital. This is a moment for Republicans to take responsibility for governing and to accept the fact that their leverage is limited with control of only one house of Congress. But if the alternative truly is default, a crazy coin option may indeed be less bad than the alternatives.

What would be on the other side?  Some suggestions include the Cat in the Hat, Alfred E. Newman (both sent in to the Takeaway) and my favorite idea, Mark Twain who once said, “Suppose you were an idiot. And suppose you were a member of Congress. But I  repeat myself.”

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Boomers and the job numbers

What does the retirement of the baby boom generation have to do with the job numbers you might ask.  I never thought of my retirement impacting the unemployment rate but reading Paul Krugman in the New York Times this morning, I realize that in a strange way I am helping the economy.  Yes, I’ve read all  the stories about how we didn’t save enough, how our homes (the big retirement plan for many) have lost value, how interest rates are hurting retirees, how the numbers are going to make Medicare and Social Security go broke and on and on.  But it never occurred to me that maybe the estimated 10.000 people a day who retire might actually be good for the economy.  Think about it.  Each person who retires has the potential to open up a job for someone else.  The bottom line is there is still work that needs to be done and at some point someone will be hired to do it.

 

AARP Social Security for Dummies Book Jacket

 

Krugman writes

 …the methods the bureau uses are public — and anyone familiar with the data understands that they are “noisy,” that especially good (or bad) months will be reported now and then as a simple consequence of statistical randomness. And that in turn means that you shouldn’t put much weight on any one month’s report.

In that case, however, what is the somewhat longer-term trend? Is the U.S. employment picture getting better? Yes, it is.

Some background: the monthly employment report is based on two surveys. One asks a random sample of employers how many people are on their payroll. The other asks a random sample of households whether their members are working or looking for work. And if you look at the trend over the past year or so, both surveys suggest a labor market that is gradually on the mend, with job creation consistently exceeding growth in the working-age population.

On the employer side, the current numbers say that over the past year the economy added 150,000 jobs a month, and revisions will probably push that number up significantly. That’s well above the 90,000 or so added jobs per month that we need to keep up with population. (This number used to be higher, but underlying work force growth has dropped off sharply now that many baby boomers are reaching retirement age.)

Meanwhile, the household survey produces estimates of both the number of Americans employed and the number unemployed, defined as people who are seeking work but don’t currently have a job. The eye-popping number from Friday’s report was a sudden drop in the unemployment rate to 7.8 percent from 8.1 percent, but as I said, you shouldn’t put too much emphasis on one month’s number. The more important point is that unemployment has been on a sustained downward trend.

But isn’t that just because people have given up looking for work, and hence no longer count as unemployed? Actually, no. It’s true that the employment-population ratio — the percentage of adults with jobs — has been more or less flat for the past year. But remember those aging baby boomers: the fraction of American adults who are in their prime working years is falling fast. Once you take the effects of an aging population into account, the numbers show a substantial improvement in the employment picture since the summer of 2011.

unemployment

unemployment (Photo credit: Sean MacEntee)

 

So the job growth and unemployment figures are slowly improving.  The overall trend is up for growth and down for unemployment.  I think one of the most shocking reactions to the numbers was the notion that they were somehow being manipulated and the things were actually much worse.  Do some like Jack Welsh actually want things to either get worse or at least to stay bad?  They just can’t bring themselves to admit that President Obama may be succeeding – despite Congress and the Republicans and turning things around.  Do they really need to win that badly?

Krugman says it better

…The U.S. economy is still far short of where it should be, and the job market has a long way to go before it makes up the ground lost in the Great Recession. But the employment data do suggest an economy that is slowly healing, an economy in which declining consumer debt burdens and a housing revival have finally put us on the road back to full employment.

And that’s the truth that the right can’t handle. The furor over Friday’s report revealed a political movement that is rooting for American failure, so obsessed with taking down Mr. Obama that good news for the nation’s long-suffering workers drives its members into a blind rage. It also revealed a movement that lives in an intellectual bubble, dealing with uncomfortable reality — whether that reality involves polls or economic data — not just by denying the facts, but by spinning wild conspiracy theories.

It is, quite simply, frightening to think that a movement this deranged wields so much political power.

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Ryan’s Budget and the 2012 Election

 Dan Wasserman sums up the Ryan Budget.

04.04RYANBUDGET.gif

President Obama called the Ryan Budget “Social Darwinism” quoting that wise Republican, Newt Gingrich.  Mitt Romney called it “marvelous”.  Paul Krugman calls it “Pink Slime Economics”

Here is Krugman

And when I say fraudulent, I mean just that. The trouble with the budget devised by Paul Ryan, the chairman of the House Budget Committee, isn’t just its almost inconceivably cruel priorities, the way it slashes taxes for corporations and the rich while drastically cutting food and medical aid to the needy. Even aside from all that, the Ryan budget purports to reduce the deficit — but the alleged deficit reduction depends on the completely unsupported assertion that trillions of dollars in revenue can be found by closing tax loopholes.

And we’re talking about a lot of loophole-closing. As Howard Gleckman of the nonpartisan Tax Policy Center points out, to make his numbers work Mr. Ryan would, by 2022, have to close enough loopholes to yield an extra $700 billion in revenue every year. That’s a lot of money, even in an economy as big as ours. So which specific loopholes has Mr. Ryan, who issued a 98-page manifesto on behalf of his budget, said he would close?

None. Not one. He has, however, categorically ruled out any move to close the major loophole that benefits the rich, namely the ultra-low tax rates on income from capital. (That’s the loophole that lets Mitt Romney pay only 14 percent of his income in taxes, a lower tax rate than that faced by many middle-class families.)

This budget fight and the election to come are about what we want the country to be.  The Republicans have that much right.  Will we become a country with the rich hiding in gated communities and getting richer or will we a a country where everyone has a chance to succeed, where the less fortunate get help, and where there is a robust middle class?  Democracies thrive in countries with an educated middle class.  Look at the driving forces behind the Arab Spring.  The choices this election will be clear. 

The budget fight is also about whether or not a deficit is important right now.  Yes, we can’t continue to grow the deficit indefinitely, but it seems to this non-economist, that the way to deal with the deficit is not through draconian cuts to the domestic budget, but spend on things that result in jobs.  When people work they pay taxes and the deficit can begin to come down.  But cutting food stamps, unemployment insurance, job retaining programs, aid to education, are all key to growing jobs or helping those who can’t find them.

Andrew Rosenthal put it better in today’s New York Times.

He ticked off some of the budget’s most near-sighted assaults: financial aid cuts to nearly 10 million college students; 1,600 fewer medical grants; 4,000 fewer scientific research grants. Starting in 2014, it would cut around 200,000 children from the Head Start program and 2 million mothers and their young children from a food assistance program. “We wouldn’t have the capacity to enforce the laws that protect the air we breathe, the water we drink or the food that we eat,” he said.

Medicaid would be gutted, Medicare would be turned into a voucher program – but the Republicans would still cut taxes by $4.6 trillion over the next decade. The cuts, as usual, would mostly benefit the wealthy.

Mr. Obama noted that the stated purpose of the Republican budget is to reduce the federal budget deficit, but he called it a Trojan horse and “thinly veiled social Darwinism.” The real purpose is to cripple government. And he said, because it guts “the very things we need to grow an economy that’s built to last – education and training, research and development, our infrastructure – it is a prescription for decline.”

The Republican response to Mr. Obama – that the nation is in a debt crisis and the president doesn’t get it – just made his point for him. We don’t have a debt crisis. We have a medium- to long-term budget problem, driven largely by rising health costs combined with an aging population. Health care reform is an honest attempt to deal with that. Letting the Bush tax cuts expire, starting with the high-end ones, would be an honest attempt to deal with that. Then there’s our lack of jobs, lack of income growth, diminishing prospects and dwindling opportunities.

And we shouldn’t forget that George W. Bush told us we didn’t need to raise taxes to pay for the war in Iraq because it would pay for itself through oil revenue.  He cut taxes for the 1% instead and created a deficit.  This probably wouldn’t have been so catastrophic except that the economy collapsed in 2008.  Here is a link to a nice chart.

So the Ryan Budget will be at the heart of the election this fall – especially if Paul Ryan is Romney’s VP.  It will be interesting.

 

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Who is really European?

I was reading Paul Krugman’s column in the New York Times this morning and I started thinking.  The Republicans accuse President Obama of trying to make us more like European Socialists, but in reality it is they who want to make us European.  Think about it a minute.

Krugman writes

Last week the European Commission confirmed what everyone suspected: the economies it surveys are shrinking, not growing. It’s not an official recession yet, but the only real question is how deep the downturn will be.

And this downturn is hitting nations that have never recovered from the last recession. For all America’s troubles, its gross domestic product has finally surpassed its pre-crisis peak; Europe’s has not. And some nations are suffering Great Depression-level pain: Greece and Ireland have had double-digit declines in output, Spain has 23 percent unemployment, Britain’s slump has now gone on longer than its slump in the 1930s.

Worse yet, European leaders — and quite a few influential players here — are still wedded to the economic doctrine responsible for this disaster.

What is that doctrine?  Basically you gut the retirement system, layoff workers, cut wages, and increase taxes.  Krugman puts it this way

Specifically, in early 2010 austerity economics — the insistence that governments should slash spending even in the face of high unemployment — became all the rage in European capitals. The doctrine asserted that the direct negative effects of spending cuts on employment would be offset by changes in “confidence,” that savage spending cuts would lead to a surge in consumer and business spending, while nations failing to make such cuts would see capital flight and soaring interest rates. If this sounds to you like something Herbert Hoover might have said, you’re right: It does and he did.

President Herbert Hoover.

Image via Wikipedia

 

Thomas Wright in a column published in the Financial Times brings in the Republicans.  He points out the while Mitt Romney and Newt Gingrich want to deal immediately with the debt crisis – like the Europeans – Democrats and, in particular the President, believe that the debt is a long term issue and not a near term crisis. 

I’m certainly not an expert, but it does appear that the European Hooverism is being largely driven by Germany.  It will be interesting to see how that works out for them in the long run.  What happens when the Greek economy continues to sink and they decide to pull out of the Euro? 

Back to Krugman again.

Meanwhile, countries that didn’t jump on the austerity train — most notably, Japan and the United States — continue to have very low borrowing costs, defying the dire predictions of fiscal hawks.

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So what will it take to convince the Pain Caucus, the people on both sides of the Atlantic who insist that we can cut our way to prosperity, that they are wrong?

After all, the usual suspects were quick to pronounce the idea of fiscal stimulus dead for all time after President Obama’s efforts failed to produce a quick fall in unemployment — even though many economists warned in advance that the stimulus was too small. Yet as far as I can tell, austerity is still considered responsible and necessary despite its catastrophic failure in practice.

The big question:  Will the Congress pass the President’s new jobs bill?  Or will it stick to slash, slash, slash?  Increasing aid to local governments for police, fire, schools and programs like the Community Development Block Grant (CDBG) will prevent layoffs and enable hiring.  Take CDBG  for example.  The City of Boston uses the funds to assist human services programs like afterschool and youth recreation, to assist small businesses and nonprofits make repairs and improvements, and help low income homeowners make repairs.  There are rules about who can get assistance.  Jobs are ceated when the business or nonprofit hires staff or a contractor to make repairs and improvements.  Assistance to homeowners also creates jobs.  Many other localities use CDBG to improve roads and sidewalks.  I think everyone understand how keeping teachers, police, and firefighters employed helps local governments.  It also increases the tax base for all levels of government and will eventually help lower the debt.  Or am I being too simplistic?

Krugman ends this way

Look, I understand why influential people are reluctant to admit that policy ideas they thought reflected deep wisdom actually amounted to utter, destructive folly. But it’s time to put delusional beliefs about the virtues of austerity in a depressed economy behind us.

So it seems that it is really the Republicans who are more European with their belief in continued austerity.  They need to look around and see what is happening in Europe and decide if they – and us – really want to be like them or continue to pursue the President’s American exceptionalism.

 

 

 

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Watching the circus

Watching the circus in Washington used to be a fun activity, but right now it is just depressing.  I got home from work last night expecting to watch the Republican vote on the Speaker’s plan only to learn that it had been postponed.  When I went to bed at 10 it was still pending.  At 5 this morning, I learned it didn’t happen because the Republican leadership didn’t have the votes.  All this for a bill that is DOA in the Senate.

We are all being held hostage by a handful of tea partiers and other Republicans who are convinced that their election gave them some kind of mandate to kill the country.  As they are learning in Wisconsin, people are beginning to have buyer’s remorse.  On the other hand, the tea partiers are threatening to run against the very people they elected if the new Congressmembers don’t come through.  Among those making the threats are Sarah Palin and the founder of the Texas Tea Party on Al Sharpton’s MSNBC show last night.  So I don’t think the 20 or so votes that Boehner is looking for will materialize, but then again, this whole spectacle is full of surprises so one never knows.

Everyone, including President Obama, has let this small faction define the fight.  I think Eugene Robinson is right:  The Republicans have one easily stated idea:  Reduce the deficit (and deny Obama a second term) while the Democrats and particularly Progressives don’t have an easily stated idea.

Those who would chronicle events in Washington can find no richer source of analogy and metaphor than the Three Stooges. These days, I’m thinking of the times when an exasperated Moe, having suffered the indignity of an accidental spritzing or clobbering, turns to Larry or Curly and demands, “What’s the big idea?”

The premise of the debt-ceiling fight is too far-fetched for a Stooges film, since no audience could imagine leaders of a great nation stumbling into such a mess. Moe’s trademark line is still relevant, however, even if it’s not followed by the two-fingered poke in the eyes that our elected officials richly deserve.

It is clear that unless President Obama ends up taking unilateral action to break a hopeless deadlock, Republicans will win. The House, the Senate and the White House are all working within GOP-defined parameters: New tax revenue is off the table, painful budget cuts are a given, everyone seems to accept the principle that a debt-ceiling increase — which allows the Treasury to pay bills Congress has already incurred — must be tied to reductions in future spending.

Besides not having an easily stated idea that everyone repeats, the Democrats have done all the compromising.  And it hasn’t worked out so well.  Look back at the retention of the Bush tax cuts:  Do you see any jobs?  Robinson concludes

Obama talks about “winning the future,” but that’s too nebulous. I’d suggest something pithier: jobs, jobs, jobs.

People may dislike paying taxes, but they dislike unemployment more. Progressives should talk about bringing the nation back to full employment and healthy growth — and how this requires an adequately funded government to play a major role.

The next time Moe asks about the big idea, Democrats, say “jobs.” You might avoid a slap on the noggin and a poke in the eyes.

I think it maybe time for the President to stop trying to compromise, to get together with Reid and Pelosi and make a real proposal.  To quote Paul Krugman

Some of us have long complained about the cult of “balance,” the insistence on portraying both parties as equally wrong and equally at fault on any issue, never mind the facts. I joked long ago that if one party declared that the earth was flat, the headlines would read “Views Differ on Shape of Planet.” But would that cult still rule in a situation as stark as the one we now face, in which one party is clearly engaged in blackmail and the other is dickering over the size of the ransom?

The answer, it turns out, is yes. And this is no laughing matter: The cult of balance has played an important role in bringing us to the edge of disaster. For when reporting on political disputes always implies that both sides are to blame, there is no penalty for extremism. Voters won’t punish you for outrageous behavior if all they ever hear is that both sides are at fault.

,,,

So what’s with the buzz about a centrist uprising? As I see it, it’s coming from people who recognize the dysfunctional nature of modern American politics, but refuse, for whatever reason, to acknowledge the one-sided role of Republican extremists in making our system dysfunctional. And it’s not hard to guess at their motivation. After all, pointing out the obvious truth gets you labeled as a shrill partisan, not just from the right, but from the ranks of self-proclaimed centrists.

But making nebulous calls for centrism, like writing news reports that always place equal blame on both parties, is a big cop-out — a cop-out that only encourages more bad behavior. The problem with American politics right now is Republican extremism, and if you’re not willing to say that, you’re helping make that problem worse.

Time for the President to not only talk the talk as he did last week, but also walk the walk.  Compromise by only one side has lead to this circus that is not even very entertaining.  At the very least, round up enough votes in the Senate to pass the Reid plan so the Democrats can at least say they did something.  You can compare plans here.  And please, let there be only one vote.  I don’t think anyone can take this again in 6 months.

 

 

 

 

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Tax breaks and the debt/budget crisis

Feeling hot and kinda pessimistic this evening.  I feel as if the progressive forces are fighting windmills and I worry that President Obama will cave in with dire consequences. 

Here is a very interesting chart posted by Chris Bowers on the Daily Kos this afternoon.

Class Warfare

If these numbers are accurate, and I believe they are,  it is interesting how they match up.  We don’t really have to do much to keep programs running. 

In the meanwhile Politico reports

Turning right with a vengeance, Republicans will bring to the House floor Tuesday a newly revised debt-ceiling bill that is remarkable for its total absence of compromise at this late date, two weeks before the threat of default.

Final revisions made Friday submerge conservative demands to reduce all federal spending to 18 percent of gross domestic product — a target that threatened to split the GOP by requiring far deeper cuts than even the party’s April budget. But Republican congressional leaders still want a 10-year, $1.8 trillion cut from nondefense appropriations and have added a balanced-budget constitutional amendment that so restricts future tax legislation that even President Ronald Reagan might have opposed it in the 1980s.

Indeed, much of the deficit-reduction legislation signed by Reagan would not qualify under the new tea-party-driven standards. And even the famed Reagan-Tip O’Neill Social Security compromise — which raised payroll taxes — passed the House in 1983 well short of the 290 votes that would be required under the constitutional amendments being promoted by the GOP.

One of the more interesting aspects of this fight centers around the battle between Eric Cantor and John Boehner for control of the Republican House.  If Cantor wins, it may drive the more moderate Republicans toward the Democrats.  But it doesn’t appear at this point that the Tea Party Republicans really care about reelection – and perhaps they don’t even care if Obama wins reelection.

House Majority Leader Eric Cantor of Virginia, right, stands with House Speaker John Boehner of Ohio on Capitol Hill in Washington. | AP Photo

Paul Krugman has an interesting take of the Republicans.

Let’s talk for a minute about what Republican leaders are rejecting.

President Obama has made it clear that he’s willing to sign on to a deficit-reduction deal that consists overwhelmingly of spending cuts, and includes draconian cuts in key social programs, up to and including a rise in the age of Medicare eligibility. These are extraordinary concessions. As The Times’s Nate Silver points out, the president has offered deals that are far to the right of what the average American voter prefers — in fact, if anything, they’re a bit to the right of what the average Republican voter prefers!

Yet Republicans are saying no. Indeed, they’re threatening to force a U.S. default, and create an economic crisis, unless they get a completely one-sided deal. And this was entirely predictable.

First of all, the modern G.O.P. fundamentally does not accept the legitimacy of a Democratic presidency — any Democratic presidency. We saw that under Bill Clinton, and we saw it again as soon as Mr. Obama took office.

As a result, Republicans are automatically against anything the president wants, even if they have supported similar proposals in the past. Mitt Romney’s health care plan became a tyrannical assault on American freedom when put in place by that man in the White House. And the same logic applies to the proposed debt deals.

Put it this way: If a Republican president had managed to extract the kind of concessions on Medicare and Social Security that Mr. Obama is offering, it would have been considered a conservative triumph. But when those concessions come attached to minor increases in revenue, and more important, when they come from a Democratic president, the proposals become unacceptable plans to tax the life out of the U.S. economy.

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Which brings me to the culpability of those who are only now facing up to the G.O.P.’s craziness.

Here’s the point: those within the G.O.P. who had misgivings about the embrace of tax-cut fanaticism might have made a stronger stand if there had been any indication that such fanaticism came with a price, if outsiders had been willing to condemn those who took irresponsible positions.

But there has been no such price. Mr. Bush squandered the surplus of the late Clinton years, yet prominent pundits pretend that the two parties share equal blame for our debt problems. Paul Ryan, the chairman of the House Budget Committee, proposed a supposed deficit-reduction plan that included huge tax cuts for corporations and the wealthy, then received an award for fiscal responsibility.

So there has been no pressure on the G.O.P. to show any kind of responsibility, or even rationality — and sure enough, it has gone off the deep end. If you’re surprised, that means that you were part of the problem.

It was fun for a while to watch Boehner herding the Republican cats and watching the infighting, but now it is time for moderate Republicans to join the Democrats and show some common sense.

 

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Congresswoman Giffords, violence, rhetoric and other thoughts

Happy 2011!  I had made a resolution to post at least once a week this year and am already behind.  I have had a difficult fall with lots of energy sapping family and work issues.  It also didn’t help that for someone like me, the political news was depressing.  There were a number of bright spots including the Massachusetts election, the repeal of Don’t Ask, Don’t tell, and ratification of START.  But overall it was pretty bleak.

But watching the first week of the new House was most entertaining.  At least it was until Saturday.

Bob and I were driving back from western Mass after a day of packing up my mother’s old apartment and when we got to Worcester, I turned on the NPR station to see if there were any news.  That was how we heard about Congresswoman Giffords, Judge Roll and the others who were shot and wounded.  I think that the assassination or attempted assassination of any political figure regardless of party or political philosophy is horrendous.  But this shooting is the culmination of the violence advocated by the radical right of the Republican party and the Tea Party Movement.

The first official to put the blame squarely where it belongs was Clarence W. Dupnik, the Pima County sheriff.  Sheriff Dupnik was blunt.  He was quoted in the Washington Post

There’s reason to believe that this individual may have a mental issue. And I think people who are unbalanced are especially susceptible to vitriol,” he said during his televised remarks. “People tend to pooh-pooh this business about all the vitriol we hear inflaming the American public by people who make a living off of doing that. That may be free speech, but it’s not without consequences.

He went on to say

It’s not unusual for all public officials to get threats constantly, myself included,” Sheriff Dupnik said. “That’s the sad thing about what’s going on in America: pretty soon we’re not going to be able to find reasonable, decent people willing to subject themselves to serve in public office.

So let’s look at some actual facts since the Republicans and the Tea Party appear to be painting themselves as victims of the liberal media and claim no responsibility of what happened.

First it is a fact that Sarah Palin posted a map with cross-hairs over the Congressional Districts of 20 Democratic Congresspersons including Giffiords.  She remarked on the fact last year.

Ms. Giffords was also among a group of Democratic House candidates featured on the Web site of Sarah Palin’s political action committee with cross hairs over their districts, a fact that disturbed Ms. Giffords at the time.

“We’re on Sarah Palin’s targeted list,” Ms. Giffords said last March. “But the thing is the way that she has it depicted has the cross hairs of a gun sight over our district. When people do that, they’ve got to realize there’s consequences to that.”

The image is no longer on the Web site, and Ms. Palin posted a statement saying “my sincere condolences are offered to the family of Representative Gabrielle Giffords and the other victims of today’s tragic shooting in Arizona. On behalf of Todd and my family, we all pray for the victims and their families, and for peace and justice.” (Late Saturday, the map was still on Ms. Palin’s Facebook page.)

Second, her office in Tuscon was vandalized after her vote in favor of Health Care Reform.  And both she and Judge Roll received threats. 

Third, her opponent in last November’s Congressional race held an event.  This information is from the blog, Firedoglake.

Kelly’s website has apparently scrubbed the event , but here is the account from the Arizona Daily Star:

Jesse Kelly, meanwhile, doesn’t seem to be bothered in the least by the Sarah Palin controversy earlier this year, when she released a list of targeted races in crosshairs, urging followers to “reload” and “aim” for Democrats. Critics said she was inciting violence.

He seems to be embracing his fellow tea partier’s idea. Kelly’s campaign event website has a stern-looking photo of the former Marine in military garb holding his weapon. It includes the headline: “Get on Target for Victory in November. Help remove Gabrielle Giffords from office. Shoot a fully automatic M16 with Jesse Kelly.”

The event costs $50

I’m sure I will have much more to say on all of this as time goes on but I want to end with this from Paul Krugman’s column today.

It’s important to be clear here about the nature of our sickness. It’s not a general lack of “civility,” the favorite term of pundits who want to wish away fundamental policy disagreements. Politeness may be a virtue, but there’s a big difference between bad manners and calls, explicit or implicit, for violence; insults aren’t the same as incitement.

The point is that there’s room in a democracy for people who ridicule and denounce those who disagree with them; there isn’t any place for eliminationist rhetoric, for suggestions that those on the other side of a debate must be removed from that debate by whatever means necessary.

And it’s the saturation of our political discourse — and especially our airwaves — with eliminationist rhetoric that lies behind the rising tide of violence.

Where’s that toxic rhetoric coming from? Let’s not make a false pretense of balance: it’s coming, overwhelmingly, from the right. It’s hard to imagine a Democratic member of Congress urging constituents to be “armed and dangerous” without being ostracized; but Representative Michele Bachmann, who did just that, is a rising star in the G.O.P.

And there’s a huge contrast in the media. Listen to Rachel Maddow or Keith Olbermann, and you’ll hear a lot of caustic remarks and mockery aimed at Republicans. But you won’t hear jokes about shooting government officials or beheading a journalist at The Washington Post. Listen to Glenn Beck or Bill O’Reilly, and you will.

Of course, the likes of Mr. Beck and Mr. O’Reilly are responding to popular demand. Citizens of other democracies may marvel at the American psyche, at the way efforts by mildly liberal presidents to expand health coverage are met with cries of tyranny and talk of armed resistance. Still, that’s what happens whenever a Democrat occupies the White House, and there’s a market for anyone willing to stoke that anger.

But even if hate is what many want to hear, that doesn’t excuse those who pander to that desire. They should be shunned by all decent people.

Unfortunately, that hasn’t been happening: the purveyors of hate have been treated with respect, even deference, by the G.O.P. establishment. As David Frum, the former Bush speechwriter, has put it, “Republicans originally thought that Fox worked for us and now we’re discovering we work for Fox.”

And this sums it all up.

Dan Wasserman

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Talking jobs and unemployment

Today I went to a graduation for 58 men and women – almost all over 3o – who went to a program at the local YMCA to sharpen skills and make them more competitive in the job market.  I shared an intern with several others in my agency.  It was announced that 8 or 9 had found jobs.  Not bad in this market, but not good either. 

Last week the Boston Globe ran a story about the report by the National Skills Coalition. 

The report projects that by 2016, Massachusetts will have nearly 400,000 job openings that require more than a high school diploma, but less than a four-year college degree. The report says “middle-skill” jobs will account for 38 percent of all openings.

Ranging from licensed practical nurses to computer support specialists, the jobs have median annual incomes of about $50,000 to $55,000.

The report says the state faces challenges in meeting the demand for middle-skilled workers, with only 32 percent of current employees having the credentials.

The graduation I attended was designed to train people for these middle-skill jobs.  But until the jobs are created, the graduates still need to pay the rent, the mortgage, buy food and clothes.  These are men and women who are doing the rights things and are still finding it tough to find a job.  Some of them were unemployed before entering the program and some will be unemployed after graduation.  Some may be eligible for unemployment benefits, but may have exhausted their time.  Which brings me to the unemployment benefits issue.

Let’s start with Paul Krugman.

There was a time when everyone took it for granted that unemployment insurance, which normally terminates after 26 weeks, would be extended in times of persistent joblessness. It was, most people agreed, the decent thing to do.

But that was then. Today, American workers face the worst job market since the Great Depression, with five job seekers for every job opening, with the average spell of unemployment now at 35 weeks. Yet the Senate went home for the holiday weekend without extending benefits. How was that possible?

The answer is that we’re facing a coalition of the heartless, the clueless and the confused. Nothing can be done about the first group, and probably not much about the second. But maybe it’s possible to clear up some of the confusion.

So who are the heartless?  They are Republicans and some Democrats a tiny number of whom may be acting out of principle.  They hide behind the deficit and statements from the clueless.

By the clueless I mean people like Sharron Angle, the Republican candidate for senator from Nevada, who has repeatedly insisted that the unemployed are deliberately choosing to stay jobless, so that they can keep collecting benefits. A sample remark: “You can make more money on unemployment than you can going down and getting one of those jobs that is an honest job but it doesn’t pay as much. We’ve put in so much entitlement into our government that we really have spoiled our citizenry.”

Now, I don’t have the impression that unemployed Americans are spoiled; desperate seems more like it. One doubts, however, that any amount of evidence could change Ms. Angle’s view of the world — and there are, unfortunately, a lot of people in our political class just like her.

And then Krugman tackles the misinformed.

But there are also, one hopes, at least a few political players who are honestly misinformed about what unemployment benefits do — who believe, for example, that Senator Jon Kyl, Republican of Arizona, was making sense when he declared that extending benefits would make unemployment worse, because “continuing to pay people unemployment compensation is a disincentive for them to seek new work.” So let’s talk about why that belief is dead wrong.

Do unemployment benefits reduce the incentive to seek work? Yes: workers receiving unemployment benefits aren’t quite as desperate as workers without benefits, and are likely to be slightly more choosy about accepting new jobs. The operative word here is “slightly”: recent economic research suggests that the effect of unemployment benefits on worker behavior is much weaker than was previously believed. Still, it’s a real effect when the economy is doing well.

But it’s an effect that is completely irrelevant to our current situation. When the economy is booming, and lack of sufficient willing workers is limiting growth, generous unemployment benefits may keep employment lower than it would have been otherwise. But as you may have noticed, right now the economy isn’t booming — again, there are five unemployed workers for every job opening. Cutting off benefits to the unemployed will make them even more desperate for work — but they can’t take jobs that aren’t there.

Will extending benefit add the to deficit?  Krugman tackles this one also.

But won’t extending unemployment benefits worsen the budget deficit? Yes, slightly — but as I and others have been arguing at length, penny-pinching in the midst of a severely depressed economy is no way to deal with our long-run budget problems. And penny-pinching at the expense of the unemployed is cruel as well as misguided.

But is being against extending benefits a political plus?  Not according to two new polls out today.  According to the New York Times story in the Caucus both a CBS News and a ABC News/Washington Post poll found the majority of those surveyed believed that Congress should extend benefits.

In the CBS News survey, 52 percent of respondents said Congress should extend unemployment benefits for people currently out of work, even if it meant increasing the budget deficit. Thirty-nine percent disagreed, and the rest said “it depends” or gave no opinion.

Broken down by party affiliation, about 7 in 10 Democrats said they supported an extension, while most Republicans said they opposed it. Independents were more evenly divided, with 47 percent in favor and 42 percent opposed.

The ABC News/Washington Post poll asked the question a little differently, and found even more support for an extension of unemployment benefits. The question noted that Congress had previously extended benefits because of the economic downturn, and was considering extending them again. It also presented capsules of each side of the debate, noting that supporters of the extension say it “will help those who can’t find work” while opponents say it “adds too much to the federal budget deficit.”

The result: 62 percent of respondents said Congress should approve another extension, while 36 percent said it should not. Those in favor included 80 percent of Democrats and 59 percent of independents, as well as 43 percent of Republicans.

So there doesn’t seem to be a lot of gain in opposition.

Standing with three Americans who have struggled to find work, President Obama spoke in the Rose Garden about the need to extend unemployment benefits.

The last word goes to the President.

Under pressure in an election year to reduce the unemployment rate, now at 9.5 percent, Mr. Obama also urged the Senate to approve a package of tax cuts and an expansion of lending to small businesses. “We all have to continue our efforts to do everything in our power to spur growth and hiring,” Mr. Obama said at the White House.

Mr. Obama, appearing before reporters in the Rose Garden flanked by three Americans who have had difficulty finding work, took aim at that argument. “That attitude reflects a lack of faith in the American people,” Mr. Obama said. “They’re not looking for a handout. They desperately want to work.”

Mr. Obama sharply criticized Republicans who have several times in the past month voted against bringing an unemployment extension bill to the Senate floor.

“After years of championing policies that turned a record surplus into a massive deficit, the same people who didn’t have any problem spending hundreds of billions of dollars on tax breaks for the wealthiest Americans are now saying we shouldn’t offer relief to middle-class Americans like Jim or Leslie or Denise, who really need help,” Mr. Obama said, referring to the three people who stood with him in the Rose Garden, brought to Washington by the White House to help illustrate the president’s point.

The Bill will pass this week, probably without Republican support, after we get the new temporary Senator from West Virginia, Carte Goodwin. 

  

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Keeping the Faith

I’ve been thinking about the mid-term elections a lot recently.  With financial reform and health care reform passed, President Obama has kept two big promises.  Of course, neither bill is perfect.  But both are steps in the right direction.  So when his poll numbers go down anyway and the pundits think mid-term election disaster it is hard to keep the faith.  In this connection, I’m looking at a piece from last Sunday’s Boston Globe and Paul Krugman’s New York Times column from yesterday.

The Globe article by Joe Keohane in the Ideas section was titled “How Facts Backfire”  and the role factual information plays in a democracy.  It was pretty bleak and discouraging.

It’s one of the great assumptions underlying modern democracy that an informed citizenry is preferable to an uninformed one. “Whenever the people are well-informed, they can be trusted with their own government,” Thomas Jefferson wrote in 1789. This notion, carried down through the years, underlies everything from humble political pamphlets to presidential debates to the very notion of a free press. Mankind may be crooked timber, as Kant put it, uniquely susceptible to ignorance and misinformation, but it’s an article of faith that knowledge is the best remedy. If people are furnished with the facts, they will be clearer thinkers and better citizens. If they are ignorant, facts will enlighten them. If they are mistaken, facts will set them straight.

Maybe not. Recently, a few political scientists have begun to discover a human tendency deeply discouraging to anyone with faith in the power of information. It’s this: Facts don’t necessarily have the power to change our minds. In fact, quite the opposite. In a series of studies in 2005 and 2006, researchers at the University of Michigan found that when misinformed people, particularly political partisans, were exposed to corrected facts in news stories, they rarely changed their minds. In fact, they often became even more strongly set in their beliefs. Facts, they found, were not curing misinformation. Like an underpowered antibiotic, facts could actually make misinformation even stronger.

This bodes ill for a democracy, because most voters — the people making decisions about how the country runs — aren’t blank slates. They already have beliefs, and a set of facts lodged in their minds. The problem is that sometimes the things they think they know are objectively, provably false. And in the presence of the correct information, such people react very, very differently than the merely uninformed. Instead of changing their minds to reflect the correct information, they can entrench themselves even deeper.

“The general idea is that it’s absolutely threatening to admit you’re wrong,” says political scientist Brendan Nyhan, the lead researcher on the Michigan study. The phenomenon — known as “backfire” — is “a natural defense mechanism to avoid that cognitive dissonance.”

Paul Krugman wrote Friday about the Republicans proposed economic plan.  Basically tax cuts for the rich and nothing for the rest of us according to Krugman.

Republicans are feeling good about the midterms — so good that they’ve started saying what they really think. This week the party’s Senate leadership stopped pretending that it cares about deficits, stating explicitly that while we can’t afford to aid the unemployed or prevent mass layoffs of schoolteachers, cost is literally no object when it comes to tax cuts for the affluent

And that’s one reason — there are others — why you should fear the consequences if the G.O.P. actually does as well in November as it hopes.

For a while, leading Republicans posed as stern foes of federal red ink. Two weeks ago, in the official G.O.P. response to President Obama’s weekly radio address, Senator Saxby Chambliss devoted his entire time to the evils of government debt, “one of the most dangerous threats confronting America today.” He went on, “At some point we have to say ‘enough is enough.’ ”

But this past Monday Jon Kyl of Arizona, the second-ranking Republican in the Senate, was asked the obvious question: if deficits are so worrisome, what about the budgetary cost of extending the Bush tax cuts for the wealthy, which the Obama administration wants to let expire but Republicans want to make permanent? What should replace $650 billion or more in lost revenue over the next decade?

His answer was breathtaking: “You do need to offset the cost of increased spending. And that’s what Republicans object to. But you should never have to offset the cost of a deliberate decision to reduce tax rates on Americans.” So $30 billion in aid to the unemployed is unaffordable, but 20 times that much in tax cuts for the rich doesn’t count.

The next day, Mitch McConnell, the Senate minority leader, confirmed that Mr. Kyl was giving the official party line: “There’s no evidence whatsoever that the Bush tax cuts actually diminished revenue. They increased revenue, because of the vibrancy of these tax cuts in the economy. So I think what Senator Kyl was expressing was the view of virtually every Republican on that subject.”

The Republicans seem to be making it pretty clear that they want to go back to the old economic way.  Krugman continues

But we’re talking about voodoo economics here, so perhaps it’s not surprising that belief in the magical powers of tax cuts is a zombie doctrine: no matter how many times you kill it with facts, it just keeps coming back. And despite repeated failure in practice, it is, more than ever, the official view of the G.O.P.

Why should this scare you? On paper, solving America’s long-run fiscal problems is eminently doable: stronger cost control for Medicare plus a moderate rise in taxes would get us most of the way there. And the perception that the deficit is manageable has helped keep U.S. borrowing costs low.

But if politicians who insist that the way to reduce deficits is to cut taxes, not raise them, start winning elections again, how much faith can anyone have that we’ll do what needs to be done? Yes, we can have a fiscal crisis. But if we do, it won’t be because we’ve spent too much trying to create jobs and help the unemployed. It will be because investors have looked at our politics and concluded, with justification, that we’ve turned into a banana republic.

Krugman also looks at the facts

…But the real news here is the confirmation that Republicans remain committed to deep voodoo, the claim that cutting taxes actually increases revenues.It’s not true, of course. Ronald Reagan said that his tax cuts would reduce deficits, then presided over a near-tripling of federal debt. When Bill Clinton raised taxes on top incomes, conservatives predicted economic disaster; what actually followed was an economic boom and a remarkable swing from budget deficit to surplus. Then the Bush tax cuts came along, helping turn that surplus into a persistent deficit, even before the crash.

So the facts seem to be higher taxes on higher incomes results in lower deficits and more economic benefit for the rest of us.  But if we believe Joe Keohane, the facts don’t matter much to those that have settled beliefs.

…Most of us like to believe that our opinions have been formed over time by careful, rational consideration of facts and ideas, and that the decisions based on those opinions, therefore, have the ring of soundness and intelligence. In reality, we often base our opinions on our beliefs, which can have an uneasy relationship with facts. And rather than facts driving beliefs, our beliefs can dictate the facts we chose to accept. They can cause us to twist facts so they fit better with our preconceived notions. Worst of all, they can lead us to uncritically accept bad information just because it reinforces our beliefs. This reinforcement makes us more confident we’re right, and even less likely to listen to any new information. And then we vote.

This effect is only heightened by the information glut, which offers — alongside an unprecedented amount of good information — endless rumors, misinformation, and questionable variations on the truth. In other words, it’s never been easier for people to be wrong, and at the same time feel more certain that they’re right.

So how exactly do the Democrats combat all the Republican nonsense?  Not only the Kyl and McConnell quotes that Krugman mentions, but also statements that if the Republicans take over during the mid-terms they will repeal the health and financial reforms.  They know very well that if they try, there will be a Presidential veto and that they will not be able to keep that promise, but despite that fact, they will be believed.  Keohane discusses a number of studies and possibilities but the most immediate solution to this problem seems to be increasing self-esteem.

One avenue may involve self-esteem. Nyhan worked on one study in which he showed that people who were given a self-affirmation exercise were more likely to consider new information than people who had not. In other words, if you feel good about yourself, you’ll listen — and if you feel insecure or threatened, you won’t. This would also explain why demagogues benefit from keeping people agitated. The more threatened people feel, the less likely they are to listen to dissenting opinions, and the more easily controlled they are.

Increasing the self-esteem of the American electorate right now means creating jobs and making some radical moves on the economy.  Some of the benefits of the reforms will also begin to impact voters by fall.

The Democrats should take Eugene Robinson’s advice on Keith Olbermann’s Countdown last night. 

I mean it’s not like the Democrats don’t have something to run on this fall. So get out there and run on it.

Gene also said in a recent column in the Washington Post

One reason I’m not so confident of a Republican blowout in the fall is that while polls clearly show that the country is in an anti-incumbent mood, there’s also considerable evidence that people see the GOP as part of the problem, not part of the solution. A new Post-ABC News poll, for example, showed that 58 percent of voters have “just some” confidence, or even less, in President Obama’s leadership, and that 68 percent were similarly doubtful about the ability of congressional Democrats to lead. But 72 percent had little or no faith in congressional Republicans — which suggests to me that the GOP has work to do before its leaders start picking out new office suites in the Capitol.

Another reason for caution is that the Republican Party is out of step with the American public on so many issues. Americans want to see unemployment benefits extended. They want tougher financial regulation, complete with consumer protections. Even health-care reform, which the GOP succeeded in painting as the apocalypse, becomes more popular as the months pass and somehow the world does not end.

I have to believe that there is a large portion of the American electorate that can be swayed by facts.  And the ray of hope is in the slide that Olbermann showed with the results of the NBC/Wall Street Journal Poll which indicates that the majority would like more, not less regulation of Wall Street, big business, the health care industry and, by a big margin, the oil industry.  They won’t get that from the Republicans who want a moratorium on regulation.

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Sunday morning health care and basketball

I’m like about 90% of the country (including the President) waking up to find out that Kansas really did lose.   I watched the game, but still hoped it would be different this morning.  Yesterday was a disaster for my bracket:  I lost both Kansas and BYU from my final four and the only reason I haven’t lost Duke and Kentucky is they haven’t had their games yet.  March Madness a few years ago was like this:  upset after upset.  Great games, but hell on one’s picks.  At this point, I’m just watching to see what happens next.

And we are also watching health care to see what happens next.  The Republican/Tea Party folks must know they are going to lose.  Yesterday they showed their true colors.  The story in the Washington Post by Paul Kane begins

Members of the Congressional Black Caucus said that racial epithets were hurled at them Saturday by angry protesters who had gathered at the Capitol to protest health-care legislation, and one congressman said he was spit upon. The most high-profile openly gay congressman, Rep. Barney Frank (D-Mass.), was heckled with anti-gay chants.

Republican members of Congress addressed the crowd both before and after the incident.  Where were they to control their followers?

Democratic leaders and their aides said they were outraged by the day’s behavior. “I have heard things today that I have not heard since March 15, 1960, when I was marching to get off the back of the bus,” said House Majority Whip James Clyburn (D-S.C.), the highest-ranking black official in Congress.

Between race (I believe that the opposition to anything proposed by President Obama and the wanting to see him fail is simply because the Republicans can’t stomach having a black man in the White House.) and abortion (The opposition to a woman’s right to choose stems, I think, from a deep seeded belief that women are incapable of having their own religious convictions or of making a rational decision), I worry what happens during the fall campaigns.

So I have to turn to Paul Krugman’s column earlier this week to remind myself what we are trying to do.

So this seems like a good time to revisit the reasons we need this reform, imperfect as it is.

As it happens, Reuters published an investigative report this week that powerfully illustrates the vileness of our current system. The report concerns the insurer Fortis, now part of Assurant Health, which turns out to have had a systematic policy of revoking its clients’ policies when they got sick. In particular, according to the Reuters report, it targeted every single policyholder who contracted H.I.V., looking for any excuse, no matter how flimsy, for cancellation. In the case that brought all this to light, Assurant Health used an obviously misdated handwritten note by a nurse, who wrote “2001” instead of “2002,” to claim that the infection was a pre-existing condition that the client had failed to declare, and revoked his policy.

This was illegal, and the company must have known it: the South Carolina Supreme Court, after upholding a decision granting large damages to the wronged policyholder, concluded that the company had been systematically concealing its actions when withdrawing coverage, not just in this case, but across the board.

But this is much more than a law enforcement issue. For one thing, it’s an example those who castigate President Obama for “demonizing” insurance companies should consider. The truth, widely documented, is that behavior like Assurant Health’s is widespread for a simple reason: it pays. A House committee estimated that Assurant made $150 million in profits between 2003 and 2007 by canceling coverage of people who thought they had insurance, a sum that dwarfs the fine the court imposed in this particular case. It’s not demonizing insurers to describe what they actually do.

Beyond that, this is a story that could happen only in America. In every other advanced nation, insurance coverage is available to everyone regardless of medical history. Our system is unique in its cruelty.

And one more thing: employment-based health insurance, which is already regulated in a way that mostly prevents this kind of abuse, is unraveling. Less than half of workers at small businesses were covered last year, down from 58 percent a decade ago. This means that in the absence of reform, an ever-growing number of Americans will be at the mercy of the likes of Assurant Health.

So what’s the answer? Americans overwhelmingly favor guaranteeing coverage to those with pre-existing conditions — but you can’t do that without pursuing broad-based reform. To make insurance affordable, you have to keep currently healthy people in the risk pool, which means requiring that everyone or almost everyone buy coverage. You can’t do that without financial aid to lower-income Americans so that they can pay the premiums. So you end up with a tripartite policy: elimination of medical discrimination, mandated coverage, and premium subsidies.

Or to put it another way, you end up with something like the health care plan Mitt Romney introduced in Massachusetts in 2006, and the very similar plan the House either will or won’t pass in the next few days. Comprehensive reform is the only way forward.

Krugman concludes

Can you imagine a better reform? Sure. If Harry Truman had managed to add health care to Social Security back in 1947, we’d have a better, cheaper system than the one whose fate now hangs in the balance. But an ideal plan isn’t on the table. And what is on the table, ready to go, is legislation that is fiscally responsible, takes major steps toward dealing with rising health care costs, and would make us a better, fairer, more decent nation.

All it will take to make this happen is for a handful of on-the-fence House members to do the right thing. Here’s hoping.

Are you rethinking your position Stephen Lynch?  And what about you, Rick Boucher in Virginia?  Do either of you really want to be the vote that kills Health Care Reform?