Monday, February 25, 2013

The Sequester

Let's start with a little background. After winning the Presidency and both houses of Congress, the Democrats went on a major spending spree. After years of complaining about the Bush deficits, they tripled it. The Tea Party formed largely as a response to this unprecedented spending and took back the House of Representatives.

In 2011, the government was about to hit the debt ceiling - the amount that it can borrow to cover its expenditures. While increases int he debt ceiling are usually non-controversial, this time the Republicans refused to raise it without cuts in spending. With a deadline coming quickly, the White House came up with a deal - in exchange for raising the debt ceiling high enough to get Obama past the election, he would support future cuts to be decided by a congressional super-committee. To be sure that the super committee did it's job, the deal also included the sequester. This is an across-the-board cut of with the deepest cuts being in the military. The idea was that Democrats would not want to see their favorite programs cut and Republicans would not want to see the military cut.

The super-committee failed. A December 31st deal on the Fiscal Cliff raised taxes on the wealthy and postponed the sequester for two months.

So where are we now?

The Republicans' position is simple - taxes have already been raised without any cuts. Now it is time for cuts. They are willing to discuss reapportioning the cuts but their constituencies will not support any new taxes.

The Democrats have their own position. Since Obama won the election, the Republicans should agree to anything the Democrats want. They will not approve any bill that does not include significant new revenue.

A lot of political calculation went into the Democrats' position. First, they really do believe that the election means that the Republicans should defer to them on all things, especially tax increases. They have been accused of moving the goalposts on this since the original deal was for cuts only and since taxes have already been raised without any spending cuts.

The Democrats have an eye on the next election and much of their strategy is the opening gambit for that. They hope that if they can force a tax increase then it will split the Republicans' coalition and allow the Democrats to retake the House. If that fails then they hope that they can blame the sequester on the Republicans. Obama began rewriting history during the third debate and have continued to insist that the sequester was the brainchild of the nasty Republicans. No less authority than Bob Woodward has taken issue with this account.

The Republicans have passed two proposals for replacing the cuts. The Democrats have rejected these but refused to make their own suggestions that don't include tax increases. Chance are they are reluctant to advance a cuts-only proposal because they know the Republicans would accept any reasonable offer.

Many Republicans have concluded that, as bad as the sequester is, it is the only deal that they will get that does not involve raising taxes.

The big danger for the Democrats would be for the sequester to take place and for the consequences to be less than predicted. Given the magnitude of the the disaster the President has described, the actuality is likely to be a dud.

That is the risk the Republicans are taking.

Friday, February 22, 2013

False Choices

In a column in the Huffington Post, Evangeline Lilly muses about CO2 emissions. She gets off to a bad start by admitting that she flew 16 hours each way to attend a climate rally in Washington DC. From there she starts fretting over why her jet wasn't powered by bio-fuels and why oil workers have to have dirty jobs.

If oil workers could choose, would they choose to work in toxic environments with damaging chemicals, or would they choose to work surrounded by clean air?

If Americans could choose, would they choose to work on the infrastructure for cancer-causing oil power or would they choose to work on the infrastructure for health reviving wind power?
If Canadians could choose, would they choose to dig up their forests, leaving behind barren and filthy wastelands, or would they choose to harvest the sun's rays and leave behind a legacy for their children?

If people had a choice, what would that choice be?

My reflections on climate choice were abruptly interrupted by the ever more sobering understanding that, right now, so many citizens of our free, democratic nations have no choice. They go to work in the dirty energy sector for lack of a better alternative.

Lilly is apparently unaware of the toxic environment involved in making solar cells and batteries. She also seems to think that the raw materials for these materialize out of thin air, possible created by combining wind and sun beams, instead of being mined in some of the world's dirtiest mines. Most of our raw materials come from third world countries because activists like her do not want them in her country.

I'm sure that most people would prefer feeding unicorns to drilling oil wells but that isn't a real choice and nether are the alternatives she presents.

Tuesday, February 19, 2013

The Gun Control Debate

I am struck by the similarities between the current gun control debate and the debate over abortions. Consider:

Both issues have highly polarized extremes who are framing the debate. The anti-abortion people believe that abortion is murder. The anti-gun people believe that guns lead to murder. The pro-abortion and pro-gun people defend their position in terms of fundamental rights.

The anti-abortion and anti-gun people would like nothing less than a total ban. The pro-abortion and pro-gun people see any restrictions as the thin edge of a wedge that will eventually lead to a complete ban.

Of course, there are significant differences. No one is rushing out to have an abortion because it might be outlawed and there are tens of millions of gun owners who will never hurt a soul with their guns. Still, the intensity and polarization of the issues is similar.

The biggest difference is that the positions are reversed between the two. Liberals are pro-abortion and anti-gun while conservatives tend to be pro-gun and anti-abortion.

Let's look at the current set of proposals. I've done this before but now some concrete legislation has been introduced.

Most proposals that have been introduced concentrate on either assault weapons or high-capacity magazines. The assault weapon ban makes the least sense. These weapons are very common but are seldom used in crimes. A complete ban would be statistically insignificant (so small you couldn't see it on a chart showing gun violence). The main reason for going after these weapons is simply that they look scary. There is nothing about a pistol grip of folding stock that makes a gun more lethal.

The attack on high-capacity magazines makes a tiny bit of sense. The reasoning is that the few seconds it takes a shooter to change magazines might give his victims time to fight back or run. There is no actual evidence  to support this, just a general feeling.

It should be pointed out that these proposals would outlaw the most popular rifle and pistol. Chances are very good that the laws will simply be ignored. In fact, in New York where such a ban already passed, thousands are vowing acts of civil disobedience by keeping their magazines. Any law that will be widely ignored is a bad law and should not be passed.

One proposal that is being pushed without any legislation yet being proposed is universal background checks. This is also known as "closing the gun show loophole". What it really means is regulating all private gun transactions. Because nothing has been proposed but the idea keeps being floated as "reasonable", talk of universal background checks in worrisome.

There are many open questions about how this would be handled. Presumably, if I wanted to sell an extra gun to my brother-in-law I would have to make a phone call or fill out a web form of some kind. Would he have to provide his Social Security Number or other unique identifier to me?

What about my wife or other family members living with me? If my wife wanted a gun for self-defense for her birthday would I have to submit her for a background check? What if I bought a gun and let her use it - would she be breaking the law for possessing a gun without a background check?

Then there is inheritance. Who is going to process the background checks for this?

Will the list of transactions be kept confidential or made public? Newspapers have already published lists of people with concealed carry permits.

Assuming a state or municipality outlaws some particular type of gun, will the list of transactions be shared with them so that they can seize the weapons? Given some of the laws being considered right now, this is a very big worry for gun owners.

What about identity theft?

This is likely to be another law that is ignored. It will be very difficult to enforce. Again, a law that will be ignored or cannot be enforced is a bad law and should not be passed.

One thing that is unacknowledged in this debate is how much of our gun violence is drug and gang-related. This is why Chicago's murder rate is so much higher than other large cities. These people are already ignoring the law so new ones will not affect them.

Friday, February 15, 2013

Tesla and the Times

New York Times reporter, John M. Broder, has been testing a new Tesla S model electric car. As part of his test he decided to try using it for a drive to Boston and back. It was not a happy experience and he wrote about it in last Sunday's Times. Tesla has fired back, claiming that he drove faster than he said, kept the interior of the car warmer, and didn't fully charge the car.

You can get a recap of everything here with links to the original pieces. One thing I have not seen is anything putting the whole trip in perspective.

Tesla's original idea was to build a top-end sports car. The idea was that these are never driven very far so battery life would not be a problem and they are so expensive that the cost of the batteries could be absorbed into the overall price. The Model S is a different matter. It is meant to be an affordable family sedan. "Affordable" is a relative term. The car starts at $52,400 for a short-range version that can go up to 160 miles. It tops out with the performance version with a range of up to 300 miles for $87,400.

I'm not sure which version Broder was using but he was given special instruction by Tesla including the location of fast-charge stations and some slower-charge stations that he could use in an emergency.

Broder did not fully charge the car at any of the stations. Instead he charged it until it showed that he had more than enough charge to reach his destination. Even that took something like 45 minutes at a fast charge station. If he had charged it at home it might have taken days.

Here's the thing - New York to Boston is a bit over 200 miles. Every car I've ever owned could do that on a single tank of gas with lots left over. One or two cars could have done the round trip on one tank. Even if I did stop for gas, that would take at most fifteen minutes including my wife running in for coffee and a potty break.

The Tesla has trouble doing this. That means it is not a substitute for a family's only car. Anyone who buys it and expects to leave town will need a second car. That is a problem for Tesla. $52,400 is a lot of money for a car that can't leave town.

Wired ran an article on this that suggested we judge the Tesla by the iPhone standard. An iPhone needs to be charged and a land-line doesn't but we accept this because the iPhone does so much more. This would be a valid measure if the Tesla offered features that a regular car does not. Being able to charge the car in my garage instead of stopping at the gas station once every week or so is not much of an incentive, especially if I forget to charge the car overnight.

Normally this would be a matter between Tesla and the NYT but the rest of us have an interest in this, too. The government gave Tesla a half-billion dollars to develop the Model S. So, in the name of global warming, the rest of us are subsidizing a car that only the top 5% can afford to drive.

Wednesday, February 13, 2013

Obama, the Minimum Wage, and Fairness

If you are an employer then this is the message that President Obama had for you in his State of the Union speech last night, "Some rich guys have gotten a lot richer therefore you need to give your least skilled employees a 25% raise." If your business is like many then you will wonder where the money for this will come from. The President's answer to that seems to be a shrug and some platitudes about fairness.

If this raise actually happens then a lot of employers are going to look at ways of reducing their workforce or at least not allowing it to expand. That will hurt employment, especially for younger workers and minorities - the groups that have the highest unemployment rates now.

This is partly offset by the economic boost that will come from low-end workers having more money. Will it all balance out? Probably not.

During the Great Depression we had deflation - the dollar could buy more than previously. Logically with buying power going up and unemployment sky-high, wages should have gone down, at least for new hires. They did not because of government pressure. This was a major factor in the high unemployment rate of the Depression (I got this from the book The Forgotten Man).

Surprisingly, Progressives are not bothered by this. They would rather see fewer people make more money than see more people employed. You can see this by their insistence on unions. States with right to work laws have lower unemployment but lower average wages that states with strong labor laws. It is an acceptable tradeoff for one person to be unemployed so that others can make more.

The issue of fairness is also driving the debate on taxes. During the election campaign, Obama pushed a balance of tax increases on the rich and spending cuts. During the Fiscal Cliff negotiations, Republicans offered to increase revenue by closing loopholes as long as they could also flatten the tax rates. Obama refused and the Republicans eventually gave him most of what he asked for - a return to Clinton-era tax rates on the top wager-earners.

That was supposed to have been followed with spending cuts. Instead the President now wants further tax increases in the form of closing loopholes while keeping the higher tax rates. Any spending cuts are still unspecified and to be named in the future. All of this continues to be in the name of fairness. The rich have too much money so we have to redistribute it.

This is one reason that the economy continues to lag. Nothing can be done to stimulate the economy unless it passes the fairness test. At the same time, policies that promote fairness do not need to promote the economy.

I even saw some Progressives admit this during the run up to the Fiscal Cliff.

So the economy continues to lag with projections that a real recovery is at least two years away for the 5th year in a row.

Friday, February 08, 2013

Obama and the Drones

Michael Gerson has a defense of President Obama's use of drones to kill Americans involved with al Qaeda. He puts this into perspective against other US presidents who justified the use of preemptive force. He has several good points but there are still some issues that are specific to Obama.

First, using drones to kill Americans involved with terrorist organizations is justifiable in a war on terror but Obama has buried that term. The Left in general has maintained that the proper reaction to 9-11 should have been to treat it as a crime instead of an act of war. The Obama Administration has supported that position. At one point it planned to try 9-11 mastermind KSM in the civil courts. Even the mission that killed Osama bin Laden was supposed to have been given the option to capture him for trial. If foreign nationals are going to be treated as international criminals with the right to due process then why aren't American citizens being given the same rights?

The bigger issue is transparency. The Obama Administration promised to be totally transparent on this issue. Instead it has been totally opaque. One big sticking point is the question of how it is determined who is high enough in al Qaeda to be involved in planning. This is critical. The whole justification for the drone strikes is imminent threat. The strikes are supposed to be confined to people who are high enough to be involved in planning future strikes against the US. Other strikes have included people as "top al Qaeda officials" when they only had two or three people reporting to them. Is someone actually reviewing documentation showing that the targets are involved in planning or is it simply assumed that any American in al Qaeda is automatically a top official?

Two other factors should be taken into consideration. The first is that the drone strikes in general are causing tremendous ill will against us in the Muslim world. The second is that we may be violating international law by operating drones in neutral countries like Pakistan.

The President's top priority has to be protecting the country but if that means that Obama has reversed himself on means and methods used by the Bush Administration then he needs to say so. Instead his administration seems to be straddling the fence, rejecting the War on Terror while using war as an excuse for extra-legal activities.

Thursday, February 07, 2013

The Future of the Republicans

After losing two presidential elections in a row, there is a lot of pressure on the Republican Party to change. Recently Karl Rove announced an initiative to retain elected Republicans rather than letting them lose primary challenges. Others are calling for the Republicans to become Democrat-lite aka RINO (Republican In Name Only). Before we go too far let's look at the Democrats' recent history. It is easy to forget that they faced exactly the same challenge just eight years ago.

In 2000, Al Gore ran as a continuation of centrist Bill Clinton while George Bush ran as a centrist Republican (compassionate conservative). The election was very close but the Republicans retained control of both houses of Congress. They actually increased their control in the mid-term 2002 election.

In 2004, Howard Dean ran a campaign aimed at moving the party to the left. He was helped in this by the net-roots, a group of liberal activists who were disgusted by Clinton's centrism. The eventual candidate was John Kerry who was rated one of the three most liberal members of the Senate. Many Democrats admitted that they were not all that enthusiastic about Kerry but they hated Bush with a passion. They were surprised when Bush won reelection and retained control of Congress. There was serious talk about a permanent Republican majority.

So what did the Democrats do? Did they talk about how they needed to move to the center? No. They made Howard Dean their party chair and consolidated their move to the left. By the 2008 election, none of the candidates were talking about being centrists. They had all become progressives. They even threw Gore's running mate out of the party for not being anti-way.

They also learned to pick their battles. They no longer talked about gun control or abortion rights. Instead they talked about the divide between the rich and the poor.

The second mid-term elections are always hard on an incumbent. The newly-energized Democrats took advantage of that and of some missteps by Bush (including a general dissatisfaction with the Iraq war) and retook both houses of Congress.

In 2008, the top Republican candidates were three centrists (McCain, Romney, and Huckabee). The Democrats had a fight between three very liberal candidates (Obama, Clinton, and Edwards). Obama won the primaries and the general election, maintaining control of Congress.

Instead of moving to the left, the Republicans moved to the right, returning to the principles of Ronald Reagan.

The Democrats lost the mid-term election heavily. The Republicans took back the House and several statehouses.

The 2012 election was almost a mirror of the 2004 election. The Republicans had a moderate candidate who did not excite them but they hated President Obama. Obama won a decisive victory but not a crushing one like Reagan's 1984 victory or even Clinton's 1996 victory.

What lessons can we draw from this?

The biggest one is how quickly political fortunes can change.

The second one is that Democrats do much better when Obama is at the top of the ticket. The electorate is so evenly divided that voter turn-out is the deciding factor. In 2008 and 2012, Obama's presence at the head of the ticket brought in records numbers of Democrats. In 1210 the Democrats stayed home but the Republicans turned out. The number of Republican governors shows that Republicans can compete in enough states to win the presidency but many of those governors won in 2010 when Obama was not on the ticket.

The third lesson is that the Republicans need to learn how to pick their battles. At the same time they need to learn to repackage a core value. The Democrats are still the party of tax and spend but they packaged it as reducing the divide between the 1% and the rest of the country. The Republicans got cast as protectors of the rich. There are plenty of possibilities but they need a good hook like John Edwards's Two Americas.

Moving to the left will not help the Republicans. They can never compete with the Democrats on this. They will always be out-bid. Instead they need to explain why the Democrats are bad for the country.

As far as picking their battles, immigration is a good place to start. Eight years ago people were pouring across the border. That has largely stopped because of the poor economy. The Republicans need to acknowledge that reality and follow through with a plan that addresses the 11 million already here. Like the grand bargain on tax reform that they offered, they can claim that they are following in Reagan's footsteps.

The Republicans also need a charismatic candidate, something that they have not had since Reagan left office. Fortunately there are several governors who meet this qualification.

Wednesday, February 06, 2013

Senator Obama vs President Obama

The US government claims the right to assassinate US citizens living outside the country and who are members of certain groups, mainly linked with al Qaeda. The justification for this is that membership in these groups constitutes an eminent threat, even if there is no actual knowledge of any plans. Assassinations are supposed to be limited to top leaders but the criteria for deciding who is a top leader is mushy. The process where a citizen is identified and authorization given has been kept secret.

Similarly, the US claims that armed drones have only killed enemy combatants with no innocent citizen casualties at all. This is possible because of the assumption that anyone within the blast radius of the target must also be an enemy combatant.

One wonders how Senator Obama would have reacted to this under President Bush? I suspect that he would have been highly critical.

We know for certain that he was critical of raising the debt limit because of deficit spending although the Bush deficit at the time was a fraction of the deficit under Obama.

And of course, back when he was candidate for the Senate, Obama gave a speech saying that there was no Red America or Blue America. President Obama has presided over the most polarized administration in living memory.

Just pointing these things out to people who haven't been paying attention.