When a removal of uncertainty would cause too much uncertainty

Businesses and wealthy individuals have gotten used to using “uncertainty” to mean “higher taxes on me.” But when taxes are to increase precisely because uncertainty is removed, the label gets risible.

In an L.A. Times story today on Jerry Brown’s tax and spending proposals, a business reporter writes:

Brown also is going after a third business benefit. He wants to raise $1 billion by ending a corporate tax break approved by state lawmakers in early 2009. The legislation, which took effect this month, allows multistate and multinational corporations that operate in California to choose each year between two methods of calculating their state income taxes, whichever results in the lower payment.

Instead, Brown wants to require that all companies pay taxes based solely on their sales in California and not on a formula involving in-state sales, real estate holdings and payroll size.

Some business and trade organizations that successfully defeated a fall initiative to repeal the corporate income tax break criticized Brown’s plan. A change in tax policy would create uncertainty at a time of continuing national economic weakness, they said.

Now, I know that Frank Luntz has successfully substituted “uncertainty” as the preferred American English term for “higher taxes on wealthy individuals and businesses.”  But this reduces the practice to absurdity.  Instead of calculating their taxes twice and paying the state whichever number is lower—the whole point being that this isn’t known in advance—businesses will be asked to calculate their taxes just once, on a single schedule.  Saying that the result would be to “create uncertainty” makes as much sense as when a conservative news service unwittingly renamed runner Tyson Gay as “Tyson Homosexual.”

Medicare will cover advance care planning–Good for Democrats and (ultimately) Republicans, too

Medicare will now cover advance care directives in its annual wellness visit. A victory for sanity over “death panel” demogoguery.

Robert Pear, in today’s New York Times, reports that Medicare will begin covering physician counseling for advance care planning—a variant of the dreaded “death panel” provision removed from health reform. As Pear summarizes things:

Congressional supporters of the new policy, though pleased, have kept quiet. They fear provoking another furor like the one in 2009 when Republicans seized on the idea of end-of-life counseling to argue that the Democrats’ bill would allow the government to cut off care for the critically ill.

The final version of the health care legislation, signed into law by President Obama in March, authorized Medicare coverage of yearly physical examinations, or wellness visits. The new rule says Medicare will cover “voluntary advance care planning,” to discuss end-of-life treatment, as part of the annual visit.

Under the rule, doctors can provide information to patients on how to prepare an “advance directive,” stating how aggressively they wish to be treated if they are so sick that they cannot make health care decisions for themselves.

While the new law does not mention advance care planning, the Obama administration has been able to achieve its policy goal through the regulation-writing process, a strategy that could become more prevalent in the next two years as the president deals with a strengthened Republican opposition in Congress.

This is a welcome development, for three separate reasons….. Continue reading “Medicare will cover advance care planning–Good for Democrats and (ultimately) Republicans, too”

How the tax deal debate is shaping up—and why we should remember our real opponents

Positions on the tax-cut debate are dividing across three separate dimensions. And on all of them, the differences among Democrats are slight compared to those between us and Republicans.

As far as I can tell, the furious debate over whether the tax deal is good or bad reflects disagreement among Democrats and liberals across three separate dimensions (which is why it will get complicated):

1. Idealists vs. Pragmatists. David Kurtz thinks the main news of Obama’s press conference yesterday is that Obama has finally declared that he’s a pragmatist, not an idealist.  I think that anyone who didn’t know that already was ignoring Obama’s entire biography, let alone his governing style, in favor of a few speeches.  In any case, those who look to a President primarily to articulate their political identity or defend their core principles clearly have reason to be more opposed to the deal than those who see the White House’s job as getting the best outcome in terms of legislation and regulations. In my book Ruling Passions I propose a division of moral labor: idealists should stick to citizen activism—and have a huge and genuine role to play there—while leaving legislation to the pragmatists.  But not everyone thinks that.  Of course, there are plenty of reasons pragmatists might, and do, oppose the deal, but the idealists will likely oppose it more bitterly.

2. Civic republicans vs. non-republican liberals. Civic republicanism (small “r,” of course) is an awkward label for a common position: that the fundamental issue of our time is the ability of the rich, and corporations, to game the political system and prevent the rest of us from exerting true self-governance.  (Roger Hodge’s The Mendacity of Hope, which I haven’t read yet, sounds from what I’ve heard like a pure instance of this view.  Richard Trumka’s angry statement opposing the deal, with its stress on income inequality and “moneyed interests,” is, perhaps surprisingly, another instance.)  In contrast, a non-republican liberal position is that giving material sustenance to the poor is more important than whether the rich get paid off, however regrettable and undeserved that is.  Randi Rhoads has been pushing this position hard on her show and her blog.  And Obama has explicitly taken it as well.

3. Immediate results people vs. repeated game players. Many of the deal’s supporters (Steve Benen, Ed Kilgore) have started to ask opponents what they propose as the next move if it’s voted down.  We opponents, frankly, don’t have a great answer so much as a different question: how can we change baseline expectations so as to achieve progressive outcomes in future negotiations?.  Everybody, of course, thinks that both the short and the long term are important to some degree.  But the deal’s supporters largely rely on the argument that results now are very important, either because in a recession those who lose benefits will face great and immediate hardship (see James), or because stimulus now will crucially boost Democratic prospects in 2012 (which is, to fill in the minor premise, an unusually important election because of the Affordable Care Act).  Most of the policy wonks, by the way, are lining up behind the deal because their professional deformation is to solve the immediate problem rather than looking at the future negotiating situation it sets up.  As professional biases go, this one’s honorable and functional—but still a bias.

My own all-things-considered opposition reflects my being a pragmatist (with respect to legislative negotiations, not politics as a whole), mostly a liberal but with growing sympathies for republicanism, and a fanatical repeated-gamer.

BUT we have to remember something.  Both sides of these debates have immeasurably more in common with each other than with the Republicans—who want to sabotage Democrats tactically and also destroy them ideologically; dislike the welfare state passionately and on principle while wanting as a matter of principle and practice to give the rich and corporations more money and power, not less; and are excellent players, on the oligarchical side, of both one-shot and repeated games.  Steve is dead right on this.  We should vigorously criticize one another.  But we should save our real outrage for its proper target: Republicans who callously and deliberately held the most vulnerable members of society hostage to the interests of the wealthiest.  Instead, I fear that the humane cop who wants to negotiate with the kidnapper and the tough-minded one who doesn’t will forget who the criminal is.

Update: “Non-republican liberal” seems a bit unfair to the category, since that label defines the school of thought in terms of what it’s not.  With some worries, since the usage is common in social-philosophy debates but can mean something quite different (and pejorative) in American political discourse, I propose calling these kinds of liberals welfarist liberals because their/our main concern is how people’s lives go, not how power is distributed.

Will the real anything please identify itself?

Alex Ross noted a couple months ago that the Metropolitan Opera’s new $16m Ring cycle was beginning . Is this a good use of resources in tough times? he asks. He makes a good try at arguing that Wagner, at least, is opera for everyone (Wagner’s views on the relationship of art to society were acute and humane; it’s all laid out in Die Meistersinger if you want to skip the heavy prose, and no, he was not writing only for an elite).  Unfortunately, Ross gets his numbers wrong.  According to the Met’s 2009 annual report, it received $3.2m from governments directly, not $698k, (still only about 1.3% of its $267m budget).  But it also received about $100m in contributions, and these were almost certainly tax deductible at the highest rate. It doesn’t pay income tax on its endowment income, which itself is the fruit of gifts in past years, deductible to the donors. A tax deduction or exemption is a government subsidy that the donor gets to direct across a wide variety of possible recipients, by matching it about 2:1 with his own money (less in states that mirror the federal deduction in their own income taxes): public money. It pays no property tax on its house, warehouses, or offices even though the police and fire departments are ready to serve it if needed, just like any other New York business, and the public schools welcome Met employees’ children. So the Met is more like 20% government supported.  Ross rather lamely justifies the expense of opera by assertions about its wonderfulness for those who get to see it; I agree about the latter but neither of our preferences butter any parsnips.

Opera is intrinsically expensive (though as Bob Frank and Phil Cook explain, the solo talent is almost certainly extracting rents), but people willingly pay almost $150 for the average seat, about $40/hr; the rest of us kick in maybe another $10.  What should we compare it to; an hour of psychotherapy? An hour in a museum?  A hour at a rock concert?

How about seeing the same production in HD on a big  TV screen, either at home, where I was just watching Mark Morris’ wonderful Met production of Orfeo Tivo’d off public television, as a small part of my monthly cable bill,  or in a theater for $25?  Sandy Borins has a post comparing live opera to the second of these and reflects on the cross-elasticities of demand for Live from the Met TV and regional opera, considering their different advantages (close-ups, sound management, convenience, opportunity to interact with other audience members and performers, etc.).  Is opera on TV an inferior substitute for the “real thing”, OK only  if you can’t afford to attend live (or don’t live in an opera city)?

Continue reading “Will the real anything please identify itself?”

Itemized receipt for the civilized society

The Third Way’s brilliant idea: sending taxpayers a receipt for what they’ve bought.

Justice Holmes said (and I’ve checked the quotation), “Taxes are what we pay for civilized society….”*  The problem is that most people don’t know which civilized things they’re paying for and how much they cost—and as a result believe some bizarre things about where taxes go.

The Third Way, whose determination to evenhandedly blame liberals and conservatives for our fiscal problems generally irritates me, has come up with a brilliant solution (abstract, whole thing as .pdf): a “Taxpayer Receipt” to be sent to each taxpayer—not posted online, dammit; hasn’t anyone heard of information costs?—detailing what his or her taxes, at her level and composition of income, paid for.

A sample would look like this:

Taxpayer receipt (from Third Way: http://content.thirdway.org/publications/335/Third_Way_Idea_Brief_-_A_Taxpayer_Receipt.pdf)

Alas, I’m afraid that Republicans, for all their stated zeal to scrutinize federal spending, would never go for it.  They benefit quite nicely from the false but common assumption that the federal budget goes mostly to foreign aid and “waste.”  Still, let’s propose it and see how they squirm.  My reasons are different from Third Way’s: TW thinks that if people see what government pays for, they’ll realize the need to cut the big items; I think that if people realize how much they love what government pays for, they’ll stop hating taxes so much.

Via Ezra Klein.

*Dissenting in Compania General de Tabacos de Filipinas v. Collector of Internal Revenue, 275 U.S. 87, 100; 48 S. Ct. 100, 105; or 72 L. Ed. 177, 183.

Haiti’s ruins and Pakistan’s flood

A plea for charity alone is not, I’ll admit, compelling reading. Here, then, are some actual reasons to believe we may be less inclined to help Pakistan after the floods than we should be.

Keith a few days ago drew some fascinating conclusions from the fact that a post of his on AIDS evoked no comments: AIDS now evokes ennui, to both good and bad effect.  It would appear that my post on Pakistan suggesting that people send money to both UNICEF and carbon offset funds was equally boring.  I deserved it: this is an intellectual blog, and though I implied intellectual reasons behind my call for charity, I didn’t spell them out.  I will now.

First, there is every reason to believe that global warming made the flood worse.  (Monsoons themselves are natural; this is a different case from James’ outstanding post on how certain high-intensity storms, in places that never used to experience them, are probably caused uniquely by global warming.) The storm itself is part of a trend in which global warming is making extreme weather events of all kinds more common. Specific details about the climate in the region suggest—with less than perfect confidence, but with no reason I can see to demand such—that storms just like this one are becoming more frequent and stronger due to warming trends. In this case, the fact that the Himalayan glaciers are melting has likely also made things worse.  Millions of people have been left homeless by the storm and at risk of starvation or cholera.  That the fate of one of those people can be chalked up to the amount of CO2 one of us produces throughout a lifetime seems pretty likely.  My headline “Peccavi,” Latin for “I have sinned,” was an intended reference to the famous Punch cartoon portraying Charles James Napier saying this after illegally conquering Sindh province.  Like him, we’ve done something to Sindh, and like him we’re guilty.

Second, we’re almost certainly giving less in response to this disaster than we give in response to others that are equally catastrophic or even less so.  Part of this is “poor marketing” by Pakistan’s government.  (Sad commentary on being as poor as Pakistan: your people’s welfare hangs on the quality of a PR job regarding their misery.)  A New York Times story today blames several other factors: the low initial death toll, slow media coverage (and no telethon, e.g. like this one), the global recession, donor fatigue, the August vacation season, and Pakistan’s bad image as a center for war, terrorists and loose nukes.  But unnamed “aid groups” seized on the main reason, I think:

Images of people slogging through water did not generate the same kind of sympathy as a leveled city, even though the dimensions are similar, aid groups noted, especially since, according to the United Nations, more than 15 million people have been affected and are often difficult to reach.

Ruins are like accidents: they’re fascinating.  Burke in his work on The Sublime and the Beautiful noted that “numbers from all parts” would visit London in ruins after an earthquake who would never care to visit when it was standing—even though almost nobody is so wicked as to want it leveled.  He further, and rightly, noted that this apparently morbid interest is socially salutary as long as it’s paired with sympathy: the fascination leads us to seek out disasters, and then the sympathy makes us want to help.  But floods aren’t as impressive; they don’t seem violent or disastrous.  They evoke images of wading to higher ground where help will arrive. We can’t picture a reality in which the help, in an unimaginably large area, has also been flooded out.

With all that as preface, here’s take two:

UNICEF United States’ page on the Pakistan floods
ClimateTrust.org, Sustainable Travel International, or NativeEnergy.com: the U.S.’s top-rated carbon offset funds (per this report, .pdf)

Let Obama be Reagan? Not quite.

Unemployment is over 9 percent, independents are souring on the President, and the Presidency is looking like a failure. Welcome to 1982—except for one small thing: the current president and his party are supposed to care.

Ezra Klein provides a fascinating graph: Obama’s respective poll ratings among Democrats, Republicans, and Independents almost precisely mirror Ronald Reagan’s respective poll ratings among Republicans, Democrats, and Independents at this point in his term; in fact, the two presidents’ poll ratings have closely tracked each other throughout.

[Click for larger image.]

Two other facts put this in context:

—The unemployment rate as of July this year was 9.5 percent.  But in July 1982 it was 9.8 percent—and rising.

—At this point in 1982, newspapers and magazines  were running stories about how Republican members of Congress thought the President was out of touch when it came to unemployment and were looking frantically for ways to distance themselves from him before the midterms. (I’m about to quote an example.)

I think it’s important to remember just how savage the Reagan Recession was, and how much short-term damage it did to his poll ratings.  And I think one reason younger political reporters and activists are so eager to write off Obama is that they don’t remember.  But this doesn’t mean that Obama and the Democrats’ long-term prospects should necessarily be expected to track Reagan’s and the Republicans’ in the early 80s. There’s a fundamental asymmetry, and it appears in a random New York Times article I pulled from August ’82 (citation and free preview here):

The problems of cities like Chester are aggravated because the Reagan budget cuts have slashed funds for public service jobs, economic development and other programs that could put people back to work. Mr. Schulze [Republican of Pennsylvania] says he has not lost faith in the his President’s program, but he feels that Mr. Reagan does not fully understand its impact.

”The direction the President has set for the economy is correct,” he said. ”But in the interim, you have to take care of situations like Chester. You don’t let them fall between the cracks.”

Spokesmen for the Administration have repeatedly maintained that the Government has minimal responsibility for the needy. In addition, Mr. Schulze thinks that the White House is not sufficiently tuned in to the political fallout from this policy and to the special problems of House members who must face the voters every two years.

All of this tracks the present eerily except the part I’ve set in boldface.  Millions of lives were ruined in the Reagan Recession.  But Reagan’s core supporters weren’t the ones most affected, and their ideology helped them rationalize not caring about those who were affected.   Democrats just aren’t like that.

The party’s political problem isn’t just unemployment.  It’s unemployment combined with being the party that avowedly cares about unemployment and whose members are likely to be feeling it.  With nobler aspirations come greater pressures to deliver.

—

The politics of blame vs. the politics of fear

The politics of blame strategy for Democrats looks even better when compared to the politics of fear.

My previous post endorsing the politics of blame—whereby Democrats would win not by talking up “practical solutions” but by calling out those responsible for current problems—ended with a whimper where I said I wasn’t sure and would think about it.  I still regret that I originally tied my opinions to my academic status, an attempt to pull rank that wasn’t appropriate.  But on substance, two posts at the Democratic Strategist have provoked further thought.  And they’ve cemented my belief that I was right the first time.

One post, by Robert Creamer, builds on the politics of blame approach.  The Democrats, on his view, must stay on offense, mobilize seniors and Hispanics (sic: around here we say Latinos) by reminding them of real, demonstrable parts of the Republican program that take direct aim at them, point out that Republican rule wrecked the economy, and above all frame the election “as a struggle between everyday Americans and corporate special interests”—in which struggle Democrats can tell the hopeful story of “battles won.”  Overall, it’s a message that seems very persuasive and has the advantage of being completely true.

An earlier post, by James Vega, advocates mobilizing the Democratic base by selling fear of what Republicans might do if elected.  What should we be afraid of?  Endless subpoenas of Clinton Obama aides; “a vastly increased range of attacks against liberal and progressive organizations modeled on the attacks on ACORN,” and a radical policy agenda including

• Requiring all elementary and middle school teachers to report suspected illegal aliens to the INS

• Opening congressional investigations into the research of climate and environmental scientists whose work has been challenged by conservatives with the goal of damaging their academic reputations and “defunding” their research.

• Radically downgrading the role and stature of Thomas Jefferson in American history curriculums nationwide and revising textbooks to deny that the founding fathers supported the separation of church and state.

• Revising the Civil Rights act to allow private businesses to discriminate against blacks and other minorities (Of course, only for the most completely noble and altruistic reasons of libertarian ethical philosophy).

• Encouraging the “open carry” of guns in public places across the nation, and especially at political events.

• Opening impeachment proceedings against Obama on grounds of his ineligibility for office or his conduct as president.

With due respect to Vega, whose work I’ve liked a lot in the past, I think this message is completely wrong.

Continue reading “The politics of blame vs. the politics of fear”

Some Quick Advice on Political Language

You can say it, Mr. President: the bad guys are called “Republicans.”

Barack Obama today, at a Chrysler plant that was saved by his administration’s intervention:

I want you to remember, though, that if some folks had their way, none of this would be happening.  This plant and your jobs might not exist.

Uh, Mr. President: those “some folks” are called Republicans. Republicans, Mr. President.  They are your political opponents.  You should remind the voters who those “some folks” are.

And no — that language isn’t inappropriate at an event like this.  There are 100 days to the election. Despite the wishes of your Chief of Staff, that’s an election it would be good for your party to win.

The politics of reform and the politics of blame

Democrats often think they face a choice between making politics an argument about whom to blame and making it about forward-looking policies. In fact, the second requires the first—especially now.

Mike Lux’s outstanding post at OpenLeft points out that Democratic policy narratives’ unpopularity  leaves candidates in November two choices. They can fold into a defensive crouch whereby they distance themselves from mainstream Obama-Congressional Democrat policies.  Or they can change the narrative by attacking corrupt and unaccountable corporations just as forcefully as Republicans attack big government. He rightly thinks the latter is a much better strategy: people are suffering and looking for someone to blame, and in a “blame election” the Democrats had better point the finger away from themselves.

Lux speculates that Washington elites mock such strategies because they grossly underestimate mid-Americans’ populism, their feeling of being ruled by huge actors whose actions they can’t affect.  That’s true.  (Many of my friends, who almost all have advanced degrees, thought that Al Gore’s attack on “powerful forces” in 2000 was a rhetorical error.  In fact, it was the core of his appeal, and won him the election.)  But there’s something else going on.

Many of us who try to care about good policy think that politics should be “deliberative”: not in the complicated, contemporary political philosophy sense where we sit around making seminar-room arguments—though Obama in weak moments seems to long for that too—but in the sense of being forward-looking, focused on solving problems and achieving results.  The politics of blame, from this perspective, is an annoyance or a distraction. A grownup whose spouse knocks over a pitcher of iced tea picks up the pitcher and keeps more tea from spilling before—or even better, instead of—yelling at the spouse.  BP spilled the oil; loose regulation allowed them to do it; campaign contributions, Dick Cheney, and the malaportioned Senate were all factors in producing loose regulation (and Salazar didn’t help much).  All of these facts are relevant to future policy.  None, the devoted policy-maker pleads, is anything but a huge distraction, and maybe a source of bad decisions, when it comes to figuring out how to clean up the spill and compensate the victims.

But we live in a representative system.  Legislators should not be concerned only with their relationship with one another.  And elections are not exercises in deliberation.  They’re a mechanism whereby people who would normally have no power occasionally get to exert some.  Voters hope to choose representatives who will fight on their side, and to make those politicians fear for their future prospects if they don’t.  Most voters lack time to deliberate, or even to keep up with the issues. They’re looking for signs that the professional politicians who do such things full time care about the same things their constituents do, in spite of rampant professional incentives to the contrary.

Elections, from a voter’s perspective, are a device for separating loyal agents from phony ones.  And while politicians would like nothing more than to stress only the positive and make no waves, voters have every reason to demand the contrary.  Nothing shows true commitment—in the technical, Schelling sense of something that demonstrates a real decision because it can’t be taken back—like naming an enemy.  It’s precisely because a corporation might be a useful ally in working out a future policy that denouncing it in terms that threaten to burn bridges involves real sacrifice, and has real meaning.  A sometimes-canny negotiator like Obama can often have it both ways: calling the enemy on the carpet and then naming the price for future kind words.  (The GOP says Obama uses “Alinsky tactics.”  Would that he used them more.)  But that only works if one names the enemy first, and risks the possibility that the enemy will remain simply an enemy, will refuse to make the deal.

An exclusive focus on forward-looking policy forgets one thing: democracy.  Not only is expertise at making good policy different from the right to make policy; the two aren’t even particularly related.  The right to make policy is earned through elections, elections are earned by proving loyalty, and politicians prove loyalty, in part, by the enemies they make.  If it makes us policy types feel better, right now there are plenty of corporations who deserve to be named as public enemies, who have done their level best to sever any tie between their profits and the country’s welfare.  The rising-tide-lifts-all-boats variety of capitalism will be strengthened, not weakened, by changing that.  There are always tradeoffs between blame and reform, but fewer now than at any time in memory.

Political ethics constitutes a lot of what I teach and study for a living.  When I post on subjects like this—as opposed to a poll or a scandal—I consider my position very carefully. I am willing, like Mark, to call fouls against my own side.

And I say: blame away.

(via J.P. Green at The Democratic Strategist).

Update: While I still think I’m right, I’m no longer as sure about it as I was yesterday.

Second Update: I realize that the previous comment left my opinions clear as mud.  The truth is that I wanted to think some things through and lacked the time on an extraordinarily busy weekend.  I’ll try to post some revised thoughts tomorrow, in a new post as well as down here for reference.

Third Update: I’ve posted some further reflections here.