What austerity looks like around the world
We’ve noted before that most countries in Europe are engaged in “austerity” — defined as some mix of spending cuts and tax increases. But what’s the actual mix?
Here’s a helpful graph from the OECD’s latest Economic Outlook. It shows the projected change in the “primary balance” of the world’s wealthiest countries between 2011 and 2013. (This is the budget after accounting for the effects of economic growth — after all, if there’s a recession and tax receipts go down as a result, we don’t want to count that as a “tax cut.”)
Some countries, like Italy, are relying heavily on tax increases. Others, like Spain and Greece, are relying far more heavily on spending cuts:
Why is no one talking about Massachusetts?
(
Massachusetts Blue Cross/Blue Shield Foundation
)
Perhaps the weirdest part of this election is that no one is talking about the Massachusetts health reforms. As Jon Cohn writes, “given that Mitt Romney signed these reforms into law while he was governor and President Obama used the Massachusetts reforms as a model for national reforms,” you would expect them to be central to the campaign. But day-to-day, they’re entirely absent.
The reason, perhaps, is that neither campaign sees much upside in bringing them up. As Cohn writes, “nearly everybody in the state has health insurance, while data suggest more people have regular access to care and fewer people face crushing health care costs.” Plus, as you can see in the graph, costs are increasing more slowly than in the rest of the nation. But since that makes Romney look like a good governor and a closet moderate, the Obama campaign has little reason to mention it, and since it makes Obamacare look good, the Romney campaign has little reason to mention it.
How Thomas Edison, Mark Zuckerberg and Iron Man are holding back American innovation
America needs its heroes, and it’s no different when it comes to innovation. “From Thomas Edison to Iron Man, you have this idea of single combat warriors working feverishly in the threadbare den of solitude,” scientist Eric Isaacs said at a Washington conference Monday, dropping a reference to the Marvel superhero who discovers a boundless source of clean energy. But it’s rarely the case that ideas are born, fully fledged, out of the heads of geniuses, just in time to save the world—outside the realm of fiction at least.
Your daily dose of euro doom
FT Alphaville posts some quasi-apocalyptic forecasts of what could happen next in Europe. If you don’t feel like being depressed this early in the morning, you can read Brad’s bit of euro optimism from Monday. If you’re trying to decide which to read, perhaps it will help to know that InTrade is placing the chances of one or more euro-zone countries leaving the currency by the end of the year at 40 percent.
How patients judge what makes ‘excellent’ health care
Alice Walton looks at a new study of 374 breast cancer patients, finding that the women’s opinions of care received didn’t necessarily line up with the quality of care provided:
Just over half of the women (55 percent) said they received “excellent” care. But most women — 88 percent — actually got care that was considered in line with the best current treatment guidelines.
Wonkbook: Obama's gay marriage bump
"There's been a dramatic zero-point shift in the polls since Obama came out for gay marriage," tweeted Nate Silver on Monday.
The tweet wasn't attached to a post or to a particular poll, but we can run some of the numbers on our own. As it happens, today is the first day that all of the polls included in the Real Clear Politics head-to-head average were taken fully or mostly after May 9th, the day President Obama endorsed gay marriage. As of this morning, they show Obama with a 1.7 percent lead. Looking back at the Wonkbook Dashboards, on the morning of May 9th, however, Obama had a 0.2 percent lead in the RCP head-to-head average. So since coming out for gay marriage, his numbers have slightly improved.
Reconciliation
—Would high energy costs make high-rise skyscrapers “uninhabitable”?
—Twenty academic studies on file-sharing that are mostly at odds with music industry’s claims.
—Lies you've been told about the Pacific Garbage Patch.
—Are “legal highs” making the drug war obsolete?
—Study: a third of all malaria drugs are counterfeit.
Perhaps Greece won’t leave the euro, after all
Recall the reasons for the current euro panic: Greece is getting bailed out and, in return, it’s supposed to cut spending and raise taxes even further. But Greek voters don’t enjoy this austerity and are rebelling against politicians who agree to the deal. So Germany’s now hinting that Greece might get booted from the euro. Disaster, right?
Greek newspapers that probably say a bunch of apocalyptic things.
(Simon Dawson - Bloomberg)
Well, perhaps not. Lately there have been signs that this situation won’t end in total apocalypse, after all. Kate McKenzie points to a new poll suggesting that Greek voters are slowly turning away from Syriza, the leading leftist party that’s threatening to rip up the bailout agreement (and hence risk a Greek exit from the euro). The Greek elections are on June 17. If voters turn away from Syriza and end up reelecting the two parties that support the bailout-for-austerity agreement, then Greece has a somewhat better chance of staying in the euro.
Housing starts: The problem with the government’s numbers
The government’s monthly report on housing starts, a widely watched indicator of the nation’s economic health, turns out to have some problems.
Take, for instance, the big news last week. According to a government report, housing starts rose 2.6 percent in April. Or maybe they fell 12.2 percent. Or maybe they rose by a much more dramatic 17.4 percent. It’s hard to say, because the reported number came with a margin of error of plus or minus 14.8 percent.
Meet Lanhee Chen, Romney’s top wonk
Molly Redden profiles Lanhee Chen, Mitt Romney’s hard-charging policy director:
Colleagues describe Chen as possessing an almost pathological work ethic. Tevi Troy, Chen’s superior from his days in the Bush White House, bet me that every single person I spoke to would lead by describing his smarts. (They did.) Bob Moffit, the senior fellow at the Heritage Foundation who hired Chen, called him “a dynamo,” while Sidney Verba, Chen’s Ph.D adviser at Harvard for his dissertation—which examined how judicial elections affect the law—remembers him as one of his most outstanding students. Kevin Hassett, an American Enterprise Institute economist advising the Romney campaign, compared Chen to “a Jason Furman, or a Peter Orszag-type,” saying, “He’s not a person who’s going to be easy to overwhelm.”
Jon Gruber on Obamacare, premium support and health policy dreams
Jonathan Gruber has a dream.
Actually, he has a few of them. And, even for an M.I.T. economist, they
MIT health economist Jon Gruber has a few policy dreams. (Bloomberg) get pretty wonky.
Gruber hopes for a not-too-distant future where Medicare and the health reform law enjoy the same status in the public’s mind. “My dream is of a world, 20 years from now, where someone says, ‘Keep the government’s hands off my ACA,’ ” said Gruber, a key architect of both Romneycare and Obamacare.
Mostly, though, the economist longs for the American public that is “steeped ... in the notion of the counterfactual.”
“I just cannot stress,” he says, “how important that is in your reporting.”
Lunch break: Solar eclipse, chromosphere edition
A look at Sunday’s solar eclipse as seen through a telescope that “has a very narrow bandpass allowing you to see the chromosphere and not the much brighter photosphere below it.” That’s technical speak for: “Here’s a really cool solar eclipse video.”
Via Jason Kottke.
Why China’s growth will likely slow, in one paragraph
From Ruchir Sharma’s ‘Breakout Nations’:
In 1998, for China to grow its $1 trillion economy by 10 percent, it had to expand its economic activities by $100 billion and consume only 10 percent of the world’s industrial commodities — the raw materials that include everything from oil to copper and steel. In 2011, to grow its $6 trillion economy that fast, it needed to expand by $600 billion a year and suck in more than 30 percent of global commodity production.
Will cheap shale gas revive U.S. manufacturing? Not so fast.
It’s hard to think of an extravagant prediction that hasn’t been made about America’s recent natural-gas boom. Let’s see: Cheap natural gas will wipe out coal. It will make the U.S. energy independent. And, oh yes, it will create one million manufacturing jobs and revitalize the Midwest.
Someone has to make these pipes.
(Keith Srakocic - AP)
That last claim comes via a recent report from PricewaterhouseCoopers. But over at the Council on Foreign Relations, Michael Levi casts a more skeptical eye on arguments that the age of cheap natural gas from shale will really lead to a dramatic revival of U.S. manufacturing.
There are reasons to think the overall impact will be fairly muted. Energy costs are still a small factor for many manufacturers. Levi points to a 2009 paper (pdf) by Joseph Aldy and William Pizer finding that “only one tenth of U.S. manufacturing involved energy costs exceeding five percent of the total value of shipments.” Aldy and Pizer estimated that a carbon tax, which raises energy prices, would affect manufacturing employment slightly — less than 3 percent — in the most energy-intensive industries like aluminum, cement, glass, and steel. The flipside is that lower energy costs, thanks to cheap natural gas, would have a similarly marginal impact.
Meet the Press Rashomon
I caught some of Sunday’s “Meet the Press” on NBC and thought Cory Booker had done a serviceable job delivering the Obama campaign’s talking points. Then, later, I learned his comments had been a gamechanging sabotage of the president’s reelection effort:
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I’d chalk this up to my tin political ear, but, at the time, the rest of the panel agreed with me. After Booker called the ads “nauseating,” David Gregory’s next words were, “if the election were held today, Mike, what is the leadership lesson of Governor Romney when he ran Bain that voters are thinking about as they’re going to the polls?” And then Mike Murphy, a Republican campaign consultant, said some stuff, none of which referenced Booker’s apparently gamechanging comments from 10 seconds earlier.
Is polarization making Congress dumber?
Polarization has changed the way that members of Congress vote. But it turns out it may also be changing the way they talk.
Congress now speaks at a 10.6 grade level — a high-school student, halfway through sophomore year — down from a 11.5 grade level in 2005, according to a Sunlight Foundation analysis of the Congressional record.
What Romney should have learned at Bain
Poor Cory Booker. It turns out that it’s easier to rescue old ladies from burning buildings than to step into the 2012 election without, well, stepping in it.
Booker, the Democratic mayor of Newark, N.J., appeared on Sunday’s “Meet the Press” on NBC to act as a surrogate for President Obama’s reelection campaign. And he did a perfectly serviceable job. Asked about the allegations that Obama is anti-business, he said that “over 90% of Americans have seen tax cuts under this president,” which is absolutely true. Asked about the auto bailout, he said that Mitt Romney “would have let the auto industry fail,” which is mostly true. And asked about tax reform, he said “the president’s put forth a bipartisan plan,” which is not, as far as I know, actually true, but certainly makes Obama sound good.
What could revolutionize health care? This database.
Think of it as a health policy wonk’s dream: Football stadium after
One insurance company’s data could fill 60 million of these.
(bigstockphoto)
football stadium packed to the brim with...health insurance claims data.
An odd dream, to be sure. But health insurance data is crucial to understand how health care dollars get spent. It shows how people use health care, what’s changing and, in some cases, why. Health insurers, however, have tended to keep that data private, as it could tip competitors off to how they handle business.
That all, however, changes today. This morning a new nonprofit called the Health Care Cost Institute will roll out a database of 5 billion health insurance claims (all stripped of the individual health plan’s identity, to address privacy concerns).
Researchers will be able to access that data, largely using it to probe a critical question: What makes health care so expensive?
Wonkbook: What if we'd had Europe's rules?
“Today we agreed that we must take steps to boost confidence and to promote growth and demand while getting our fiscal houses in order,” said President Obama after the G-8 meeting. “We agreed upon the importance of a strong and cohesive eurozone and affirmed our interest in Greece staying in the eurozone while respecting its commitments.”
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Ezra Klein
Ezra Klein is the editor of Wonkblog and a columnist at the Washington Post, as well as a contributor to MSNBC and Bloomberg. His work focuses on domestic and economic policymaking, as well as the political system that’s constantly screwing it up. He really likes graphs, and is on Twitter, Google+ and Facebook. E-mail him here.
Suzy Khimm
Suzy Khimm covers the budget, economic policy, and financial regulatory reform. Before coming to Washington, she was based in Brazil and Southeast Asia, where she wrote for the Economist, Slate, and the Wall Street Journal Asia. Follow her on Twitter here, and email her here.
Sarah Kliff
Sarah Kliff covers health policy, focusing on Medicare, Medicaid and the health reform law. She tries to fit in some reproductive health and education policy coverage, too, alongside an occasional hockey reference. Her work has appeared in Newsweek, Politico, and the BBC. She is on Twitter and Facebook.
Brad Plumer
Brad Plumer is a reporter focusing on energy and environmental issues. He was previously an associate editor at The New Republic. Follow him on Twitter. Email him here.
