Month: December 2009

by Patrick Appel

Reihan responds to Ezra:

If we really did argue the issue [of health care reform] in this terrain of number of lives saved, I have to say — I'm pretty confident that we could do much better than $900 billion for 150,000 lives, particularly if we are entirely indifferent to the impact on total employment, economic growth, and personal freedom.

Michael Cannon and Yglesias debate Ezra's data.

 
by Patrick Appel

Bruce Mirken points to a new survey:

More high school seniors report smoking marijuana in the past 30 day than smoked cigarettes: 20.6 percent vs. 20.1 percent. And marijuana use is up (albeit in the same general range it’s been in for several years) while teen cigarette smoking continues to decline, and has dropped markedly since the early ‘90s.

Jacob Sullum jumps in:

To put the recent upward trend in perspective, past-month marijuana use by high school seniors is still only about half as common as it was in 1979. Still, federal officials lament that "the percentage of eighth-graders who saw a 'great risk' in occasionally smoking marijuana fell from 50.5 percent in 2004 to 48.1 percent in 2008 and 44.8 percent this year." It speaks volumes about the scientific basis of our current drug policy that the people charged with implementing it openly pin their hopes for success on their ability to trick 13-year-olds into believing something that is patently false.

(Image by Flickr user Splifr. More of his images here)

by Andrew Sprung

In a too-brief interview with Tim Fernholz, Elizabeth Warren, chair of the Congressional Oversight Panel for the bank bailouts, lays down an important regulatory principle and makes an important distinction. My italics:

Should the government step in and break up the biggest banks?

There are a lot of ways to regulate "too big to fail" financial institutions: break them up, regulate them more closely, tax them more aggressively, insure them, and so on. And I'm totally in favor of increased regulatory scrutiny of these banks. But those are all regulatory tools. Regulations, over time, fail. I want to see Congress focus more on a credible system for liquidating the banks that are considered too big to fail. The little guys aren't immortal; they pay for their mistakes. The big guys can't be immortal either. A free market cannot operate in a too-big-to-fail world.

In other words, it's more important to ensure that regulators can clean up failed banks, no matter how big, without systemic risk than it is to empower them to prevent large banks from failing. That's a conservative principle from the country's foremost financial consumer advocate.  Warren wants to create the conditions that Alan Greenspan believed the market would impose unaided — in which the real possibility of failure itself "regulates" the thinking of bank executives.

Perhaps because of her governmental role, it's hard to find much detail on Warren's assessment of the bills currently pending. I would like to know what Warren thinks of the way the House and Senate bills handle resolution authority for the big banks — and what ancillary legislation is most important in her view. How important is the $150 billion fund that the House bill collects from big banks to cover the possible failure of one of their own? What about the provision that allows for secured creditors losing up to 20% of their loan value in the event of a failure?  What about the proposed so-called "living wills" that would help receivers unwind the assets of big banks that fail?

Perhaps, too, the line is a bit blurry between Warren's "regulations," which "over time, fail" and a "system for liquidating the banks," which would in a sense run on autopilot since it would safeguard the possibility of failure. Take, for example, the  Kanjorski amendment that passed as part of the House banking bill last week, which enables regulators to take pre-emptive action to prevent banks from getting "too big to fail." 

The bill "considers a variety of objective standards to determine if financial firms pose a threat to our financial stability, including the scope, scale, exposure, leverage, interconnectedness of financial activities, as well as size of the financial company" (but does not limit the size of financial institutions, as Peter Boone and Simon Johnson have suggested such a bill might).  While that mainly falls under the heading of 'regulation,' it does include the authority to block mergers and acquisitions or force the breakup of a company if it's deemed a systemic risk.

The effectiveness of that provision depends on the human judgment of  the Financial Services Oversight Council that would exercise its powers. But to the extent that it's effective, it would help keep banks from getting too big to fail as well as presumably helping to keep them from failing.

by Patrick Appel

TNC responds to my criticism and admits that Lieberman's actions are fueled not just by spite for Democrats. One of TNC's commenters takes issue with my reading:

When you ask "What about the Connecticut insurers? They make up a sizable part of contributions to his office" you imply that protecting the profits of an industry in a Senator's state or those of his contributors is a motivating factor in his voting on a bill. Setting aside Lieberman's claims that the millions he's received from insurance and pharmaceutical interests play no role in his decision (ahem), I think it's worth looking at Connecticut's other representatives on Capitol Hill:

Senator Dodd: Insurance: $1,249,006 (#3), Pharmaceuticals/Health Products: $222,950 (#16), Health Professionals $327,800 (#12)

Rep. John Larson (CT-1): Insurance $73,200 (#2), Pharmaceuticals / Health Products $19,296 (#13), Health Professionals $66,050(#3)

Rep. Joe Courtney (CT-2): Insurance: $10,000 (#16), Pharmaceuticals / Health Products $15,267 (#9), Health Professionals: $24,000 (#4)

Rep. Rosa DeLauro (CT03) Insurance: $13,250 (#11), Pharmaceuticals / Health Products $7,250 (#17), Health Professionals $40,550 (#2)

Rep. Jim Himes (CT-4): insurance : $64,787 (#3), Pharmaceuticals / Health Products: $25,846 (#14), Health Professionals $16,600 (#18)

Rep. Chris Murphy (CT-5): Insurance: $28,000 (#8), Pharma (not in top 20), Health Professionals: $64,820 (#2)

Lieberman: Insurance: $427,894 (#7), Pharmaceuticals / Health Products $297,090 (#10), Health Professionals: $359,370 (#8)

Lieberman's contributions are right in line with the others'. Dodd represents the exact same industries, while both Larson (Hartford) and Himes (Stamford / Greenwich) have a very large insurance industry presence in their districts. All the others voted or would vote for Health Care (House and current Senate versions).

Yes, but Lieberman isn't getting money from the Democratic Senatorial Campaign Committee or Democratic Congressional Campaign Committee and therefore isn't captive to the Democratic party's agenda. Money doesn't tell the whole story and part of the equation is Lieberman's particular brand of centrism and his loathing a rather large segment of the Democratic party, but I don't by that Lieberman is acting entirely out of spite; he's acting out of political expediency and spite. Another reader writes:

Some have made the obvious connection of why Joe might want to scuttle recent health care proposals, that he is representing one of the largest industries in his state, but few have elaborated on why these companies might oppose it. Namely, the proposal to institute a brand new 1.16% premium tax effective next year is driving the industry mad, and for good reason.For one thing, no one budgeted it and it will mean huge dollars that can’t be recouped via premium increases.  Also, the industry is operating at a tight 2% margin, despite what most believe, and this will slash it in half.  Actually, no one seems to recall that it might be a good idea to have insurance companies that are financially secure. They are the ones that have to be around in the future to pay our skyrocketing bills.

I asked where this reader got his numbers and he followed up:

Looks like last years profit number was 3.3%, according to this article by Ezra Klein. I was an actuary at a very large plan and we explicitly priced for a 2% margin. The premium tax is in the Reid proposal, Sec. 9010, Imposition of annual fee on health insurance providers. The 1.16% is an estimate of the percentage of 6.7 billion that will be raised annually to the total premium for the industry of around 505 billion (that number comes from AHIP, I believe. The 1.16% is not exact but its close for many insurers). This starts in 2010. Insurers will have to add it to premiums as soon as possible, which will probably be later next year or January 2011. In the meantime it eats into slim margins. Not to mention the fact that its payable whether the insurer makes money or not, since its based on premium.

by Patrick Appel

Hasan Khan reports from Islamabad:

Mullah Baradar, the deputy to the Afghan Taliban's leader Mullah

Muhammad Omar and de-facto operational commander of the movement, is leading those who favor talks with the Afghan government. Mullah Baradar and his allies believe the political situation for starting peace talks is in the Taliban's favor because several provinces in Afghanistan are virtually controlled by the Taliban, thus allowing them to negotiate from a position of strength.

And the politically savvy Mullah Baradar reportedly wants to exploit the opportunity presented by the vigorous debate in the United States over President Obama's controversial recent announcement that he is sending 30,000 more U.S. troops to the Afghan theater.

However, Siraj Haqqani, the powerful son of the well known Afghan militant commander Jalaluddin Haqqani, is opposed to entering peace talks with the coalition. The younger Haqqani is reputedly the strongest commander in eastern Afghanistan, and has the support of large numbers of Arab fighters who oppose negotiating with coalition forces absent a total withdrawal, and Hizb-e-Islami leader Gulbuddin Hekmatyar.

by Chris Bodenner

A reader writes:

I lived in Houston for over 30 years before moving to the Northwest.  Portland should be counted every bit a major city as Portland, and Providence as well.  Yes, Houston has a much larger population, but it’s also a huge urban sprawl.  We used to drive 50 miles from our house to my parents, both of which were in the city limits.  A lot of cities in mountainous or water-bound areas, would have a much larger population if you took all of the surrounding towns within 25-35 miles and included them in their population.

However, Houston electing a gay mayor is huge, because it’s the first major Southern city to do so.  This isn’t Portland or Providence in the crunchy Northwest or liberal Northeast, but a city in Texas.  And we’re not talking about Austin. While there’s a thriving gay community in the Montrose area, Houston is a pretty eclectic mix of folks.  It has a large African American (as Annise Parker’s opponent was), a huge Asian population, a mix of urban liberals and big business conservatives, and a very large Baptistfundamental population.  While I don’t know if Houston would vote for gay marriage, I’m very proud that my former home town was open-minded enough to elect an openly gay mayor.

Perhaps Houston will be a stop on Conor’s forthcoming road trip through the South. Atlas Obscura, a site we blogged about this weekend, notes five odd attractions in Houston. Here’s the entry for the Beer Can House:

John Milkovisch loved beer. He drank a six pack a day and saved all the cans. When he retired in the 1960s, he put the cans to good use by covering the exterior of his house with them. Not wanting any part of the cans to go to waste, Milkovisch built mobiles, fences, sculptures and windmills out of the tops and bottoms of his beer cans, as well as wind chimes and curtains out of the pull tabs. When he died in 1988, he had spent 18 years covering his house, fence and even his tree with some 39,000 beer cans. In the words of John Milkovisch: “Some people say this is sculpture, but I didn’t go to no expensive school to get these crazy notions.”

I’m sure Dish readers can suggest even cooler, more obscure sites found in Houston. Right?

Today on the Dish we composed a reax of Joe Lieberman's latest antics on healthcare reform. Yglesias vented about how shackled Congress is by the GOP minority (which seems to include Joe these days). In other news, the head of the Anglican Church spoke out against the Uganda bill, cross-dressing activism in Iran grew stronger, and the regime finally made a move against the detained American hikers.

Among the posts composed by Conor today, he tackled Jonah Goldberg over his views of proper punditry, spotlighted a detestable sheriff, recommended a sprawling new piece by Jim Manzi, and blegged for: recommended Southern sites, journalism from 2009, unreported topics, and jokes. Among Sprung's writings today, he examined Secretary Gates' approach to Pakistan, sized up the latest spat between Greenwald and Joe Klein over Af-Pak, and profiled the hidden beauty of Buffalo, New York.

In other coverage, Patrick joined Larison and Yglesias in critiquing Taibbi's latest liberal tirade against the Obama administration. Appel also continued his discussion over the inner-workings of the Dish and I dug up a passage from Sully addressing the same.

People actually buy these for dogs.

— C.B.

by Conor Friedersdorf

In National Affairs, a new magazine run by the estimable Yuval Levin, entrepreneur Jim Manzi presents a manifesto of sorts for bringing about the continued prosperity of the United States. The whole article is worth a read, so I am not going to excerpt it, though I am going to return to narrow points in later posts. Like Grand New Party, the thoughtful product of Reihan Salam and Ross Douthat, Mr. Manzi's piece suggests a framework for understanding the challenges that America faces — thank goodness another serious voice is getting us beyond bromides about liberty and tyranny — the trade-offs we must resolve in our public policy, and specific policy proposals for those persuaded by what precedes them. I hope it gets the attention it deserves, including thoughtful responses from across the political spectrum.

And should it reach folks making policy within the Obama Administration and the current Congress, I hope it lays bare for them how negligent they are in grappling with grave challenges that have gone ignored for too long already.

by Chris Bodenner

Buzzfeed collects the ten most depressing Christmas songs. Here's one even bluer than Elvis':

Apparently the most depressing day of the year is five weeks away – the third Monday in January.