Roll Call: Latest News on Capitol Hill, Congress, Politics and Elections
April 20, 2014

April 18, 2014

It Pays to be Super Rich in America — For Now

Floyd Norris: “It is an interesting fact that our current tax system assures that — year after year — the superrich, those who report adjusted gross incomes of more than $10 million, have tax rates that are significantly lower than those of the very rich, those earning more than $500,000 but less than $10 million.”

“Figures just released by the Internal Revenue Service show that in 2011 the difference in rates between the groups rose to 4.1 percentage points, the largest since the I.R.S. began calculating the data in 2000. The superrich paid 20.4 percent of their income in federal income taxes in 2011, while the very rich paid 24.5 percent.”

Screen Shot 2014 04 18 at 12.29.38 PM 438x335 It Pays to be Super Rich in America    For Now

“Why are the superrich treated so well? It is largely because investment income — what we used to call unearned income — has long enjoyed preferential tax treatment.”

“But starting in 2013, the wealthy face significant tax increases. And the increases are greater for investment income. It seems likely that the gap in tax rates between the superrich and the very rich may be narrowed.”

Many Americans Face Financial Peril With a Job Loss

Gallup: Many working Americans would experience financial peril if they lost their current job, putting pressure on them to find a new job quickly. A substantial minority of U.S. workers say they could go just one week (14%) or one month (29%) before experiencing significant financial hardship if they lost their job.

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Implications: “With long-term unemployment a serious problem in recent years, many U.S. workers are not in a position financially to go a month, or even a week, without finding a new job if laid off. That underscores the economic hardship that unemployment of any length can bring on U.S. families, particularly for younger and lower-income workers.”

“Gallup estimates that about 9% of workers are especially vulnerable, in that they think it is at least fairly likely they will be laid off but do not have the financial means to go more than a month without finding new employment.”

Posted at 12:14 p.m.

Combating Climate Change and Economic Growth Can Co-Exist

Paul Krugman notes that there is some good news from the recent report by the Intergovernmental Panel on Climate Change.

“There is one piece of the assessment that is surprisingly, if conditionally, upbeat: Its take on the economics of mitigation. Even as the report calls for drastic action to limit emissions of greenhouse gases, it asserts that the economic impact of such drastic action would be surprisingly small.”

“What’s behind this economic optimism? To a large extent, it reflects a technological revolution many people don’t know about, the incredible recent decline in the cost of renewable energy, solar power in particular.”

“The climate change panel … notes that “many RE [renewable energy] technologies have demonstrated substantial performance improvements and cost reductions” since it released its last assessment, back in 2007.”

“Thanks to this technological leap forward, the climate panel can talk about ‘decarbonizing’ electricity generation as a realistic goal — and since coal-fired power plants are a very large part of the climate problem, that’s a big part of the solution right there.”

Krugman asserts “there’s no reason we can’t become richer while reducing our impact on the environment.”

Posted at 8:52 a.m.
Energy & Environment

Obamacare Enrollment Numbers: ‘Good News — Very, Very Good News’

Jonathan Cohn declares the latest Obamacare enrollment numbers to be “good news—very, very good news.”

“While not everybody who signs up for a plan pays the premiums, anecdotal reports suggest that 80 to 85 percent have so far. At worst, then, enrollment would be around 6.4 million.”

slide1 18 Obamacare Enrollment Numbers: Good News    Very, Very Good News

Moving on to the age mix, Cohn notes that “the overall age mix for the Affordable Care Act is virtually the same as the age mix was in Massachusetts. More important, it vindicates the predictions of experts like Gruber who said, all along, that young people would be among the last to sign up.”

slide1 16 Obamacare Enrollment Numbers: Good News    Very, Very Good News

Cohn acknowledges there are still areas of uncertainty including “the state-by-state breakdown [which] matters a lot more than the national one.”

“The outlook on premiums is also uncertain. Underlying medical costs appear to be rising … But some industry officials and consultants have indicated that the increases are more likely to be modest—and that the markets, as a whole, appear stable.”

Posted at 8:12 a.m.

Eight Million is More than Just A Number

Paul Krugman points out that the Obamacare enrollment of eight million has a “crucial implication: the benefits of Obamacare, for all its imperfections, are immense.”

“Millions of people who lived extremely anxious lives now have far more security than before. Compared with those benefits, the complaints of some already insured people that they have less choice of doctors than before, or that they’re no longer allowed to retain minimalist plans, look like whining.”

Posted at 7:57 a.m.

Why Obamacare is Working

Sarah Kliff: “There’s a very simple reason that Obamacare hit 8 million sign-ups: Being uninsured is horrible.”

“But the political conversation over Obamacare was driven almost entirely by people who had, and knew they would be able to keep, their health insurance. It was filled with a lot of assumptions, theories, and speculations about what people who didn’t have good insurance, or any insurance, would do. And after Obamacare’s disastrous launch, the theory took hold that these people wouldn’t find this untested program worth the trouble. It was the permanently insured speculating about the uninsured and the barely insured – and, unsurprisingly, they got it wrong.”

“Back in December, when the web site’s woes were fresh in everyone’s mind, I made a prediction that sounded strange even to me: Obamacare might still hit its 7 million enrollees. The reason I made that prediction was I’d been talking to the uninsured who’d been spending hours or days or weeks trying to get through the web site. They were frustrated and they were angry. But not one of them had given up.”

Posted at 7:10 a.m.

April 17, 2014

Obamacare Enrollment Pushes Past 8 Million

President Obama announced that 8 million people have signed up for health care through new insurance exchanges, the Washington Post reports.

“Obama made a surprise appearance in the White House briefing room to trumpet the new figures, which beat initial projections by 1 million people. Equally critical: About 35 percent of those who signed up are under the age of 35, Obama said. Enrolling substantial numbers of younger, healthier Americans is crucial for the law’s success.”

Los Angeles Times: “Millions more Americans have signed up for health insurance without using the marketplaces, including through Medicaid, employers or directly from insurers. That has helped to dramatically drive down the nation’s uninsured rate, according to a growing number of national surveys.”

“Estimates of the total gain in insurance coverage nationally are still preliminary… But new Gallup survey data released this week suggest that as many as 12 million previously uninsured Americans have already gained coverage since last fall.”

Posted at 4:20 p.m.

When Free Speech is the Trojan Horse of Intolerence

Nesrine Malik argues in her New York Times opinion piece that “defense of free speech often hides a multitude of sins.”

“Since Brandeis University withdrew an honor it had intended to bestow on the author and activist Ayaan Hirsi Ali, many have flocked to her defense in the name of free expression — no matter how offensive. But implicitly they are suggesting that Islam and Muslims are worthy targets of Ms. Hirsi Ali’s scorn. And their preciousness about the right to offend won’t be credible until they advocate extending it beyond Islamophobes — to racists, anti-Semites and homophobes, too.”

“The accusations leveled at Brandeis show the perils of not sticking entirely to free speech absolutism.”

“Had Ms. Hirsi Ali been a widely acknowledged homophobe, or white supremacist, would free speech supporters have rushed so readily to their lecterns to defend her? Probably not, which is why the right to offend should be extended to all. Otherwise, our personal preferences will always dictate that there be exceptions.”

“The reaction to the Brandeis affair is a troubling harbinger. It suggests that America, like Europe, might also begin to pick and choose who deserves to be protected from offensive speech. Once that door is open, the Trojan horse of libertarianism will smuggle in intolerance.”

Posted at 2:42 p.m.
Social Issues

The Republicans’ Obamacare: A Grand Swindle

Brian Beutler notes that Obamacare’s recent success has muted Republican calls to repeal the law.

“Republicans have replaced an unabashed ‘full repeal!’ mantra with a deluge of weasel words meant to conceal the fact that ‘repeal’ is still the beginning and end of their health-care reform agenda. It’s still the goal—they’re just a little ashamed of it now.”

“Though I suspect we’ll get there eventually, Republicans for now aren’t weening themselves off of full repeal by narrowing the scope of provisions they actually propose to eliminate. They are instead expressing appreciation for a variety Obamacare’s actualized goals and then, in the next breath, a hushed desire to undo every one of them. All without offering anything that would recreate those achievements using different mechanisms.”

“It’s a grand swindle.”

“The good news is that it will fail if Democrats are prepared to remind the public that Obamacare created these benefits; Republicans voted against Obamacare, to a person; they are still trying to repeal it; and they have a long record of opposing its means and its ends in equal measure. But the awful truth is that if Democrats are determined to avoid thoroughgoing debates about Obamacare, and at times they appear to be, then it might just work.”

Posted at 2:32 p.m.

Obamacare Penalties Could Help Boost Enrollment

Gallup: “The increase in the Affordable Care Act fine next year to a minimum $325, or 2% of one’s yearly household income, could compel a significant amount of still-uninsured Americans who did not sign up during the open enrollment period to do so in 2015. This increase could begin to taper off between the 2015 and 2016 tax years if the average fine moves between $500 and $1,000.”

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But: “Across the various fine levels, adults with excellent or very good self-reported health are less likely to say they would sign up for health insurance than adults with poorer health. However, increasing the fine does increase the likelihood that healthier adults will enroll in a plan. At the $1,000 level, a solid majority of Americans in all health groups measured report being more likely to sign up for insurance than paying the fine.”

Posted at 9:57 a.m.

Surge in Clean Energy Investment May Mark a Turnaround

Bloomberg: “Clean energy investment rose by 9 percent in the first quarter from a year earlier on surging demand for rooftop solar panels from the U.S. to Japan.”

“New investment in renewable power and energy efficiency rose to $47.7 billion in the first three months of the year from $43.6 billion, Bloomberg New Energy Finance said today in an e-mailed statement.”

“The increase may mark a turnaround. Investment in low-carbon power and energy-efficiency equipment has fallen for two years as industrialized nations pared back subsidies.”

Two patterns are emerging: “the increasing share of small-scale solar in total investment, and the expansion of investment into more developing countries.”

Is Obama Really the ‘Deporter in Chief?’

New York Times: “New deportation cases brought by the Obama administration in the nation’s immigration courts have been declining steadily since 2009, and judges have increasingly ruled against deportations, leading to a 43 percent drop in the number of deportations through the courts in the last five years, according to Justice Department statistics released on Wednesday.”

“The statistics present a different picture of President Obama’s enforcement policies than the one painted by many immigrant advocates … While Mr. Obama has deported more foreigners than any other president, the pace of deportations has recently declined.”

Vox paints a bigger picture of deportations under the Obama administration to include total deportations:

“Increasingly, the Obama administration has been deporting people without hearings. Anyone caught in that large ‘border’ zone can be deported through a process called ‘expedited removal.’ The same goes for anyone who’s been deported previously. These ‘expedited removals’ have become far more common.”

Screen Shot 2014 04 08 at 11.00.57 AM Is Obama Really the Deporter in Chief?

Posted at 9:27 a.m.

Where’s the Obamacare Death Spiral?

The Economist: “In the list of ominous predictions about Obamacare, a main fear has been that only sick people will sign up. This would prompt insurers to raise prices, making healthy people even less likely to enroll (the dreaded death spiral). However, Gallup reported that the newly insured are not more or less sickly than the general population. Furthermore, new enrollees are disproportionately young: those aged 18-29 comprise 30% of the newly insured, compared with 21% of the broader adult population. There is no magic number of young, healthy enrollees that will make Obamacare succeed. But a death spiral seems unlikely.”

Posted at 9:05 a.m.

Study Predicts ‘Rapid Increase’ in Medicaid Expansion States

An Urban Institute study confirms recent polls showing a significant drop in uninsured Americans, particularly in those states that expanded Medicaid under Obamacare.

“We estimate that the number of uninsured adults fell by 5.4 million between September 2013 and early March 2014 … Given the surge in enrollment in the Marketplaces at the end of March, we would expect that gains in coverage over the full month will be even higher.”

However: “The uninsurance rate for low-income adults across the nation remains quite high (34.5 percent). In the expansion states, where the uninsurance rate for low-income adults was 27.8 percent at the time of our most recent survey, the opportunity remains for substantial coverage gains under the Medicaid program. In the nonexpansion states, where the uninsurance rate for low-income adults was at 40.7 percent, low-income adults have few paths to coverage in the absence of Medicaid.”


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Posted at 8:53 a.m.

Obamacare’s Hidden Taxes?

Casey Mulligan argues that Obamacare imposes “hidden taxes” that impose economic burdens. He contrasts the U.S. health insurance payroll tax rates before Obamacare with those in Western Europe.

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“The contrast between the United States before the passage of the Affordable Care Act and Western Europe is consistent with the common sense idea that universal health coverage has a cost in the form of taxation of labor market activity. This is not to say that one system is better than the other. The point is that benefits appear to come with costs: more coverage requires higher tax rates.”

“Yet the conventional wisdom is that the United States is now expanding coverage with hardly any new taxes on middle-class workers.”

Mulligan  asserts that “the health overhaul contains a variety of hidden taxes — provisions that politicians and journalists do not call taxes, but nonetheless are the economic equivalent of taxes — that in combination have a lot in common with the payroll taxes that Europeans use to pay for their public medical programs.”

“For the most part, the new hidden taxes are economically equivalent to either employment taxes or income taxes.”

Raising the Minimum Wage: It’s About Basic Dignity and Fairness

Charles Blow explains why “the minimum wage debate resonates so profoundly with so many: We know what it feels like to not have enough money after you’ve busted your body with too-hard work.”

“Raising the minimum wage won’t erase all of the problems of the poor, but it is one component, one rooted in basic dignity and fairness, of a much fairer picture of income inequality and poverty.”

“On some level, is the focus on the minimum wage a political ploy on the part of Democrats? I have no doubt. But that doesn’t drain the proposal of its merit. Much of what occurs in Washington occurs at the intersection of political advantage and earnest intentions, and it has ever been thus. Whenever one side accuses the other of playing politics, the accusation is often laced with an envy of the other’s adroitness.”

“So with the minimum wage, we have an issue that’s both smart politics and compassionate policy.”

“Now, if both sides are playing politics with the minimum wage to some degree, which side would you rather be on: that of the working people, who are struggling to make a living, or that of the politicians determined to block them?”

Posted at 7:28 a.m.

April 16, 2014

How Personality Explains Lawmaker Behavior

Adam Ramey: “Using every floor speech by every member of the U.S. Congress since 1996, we use some recent methods in computer science to generate the first estimates of legislator personality over time. For each member, we estimate their positions on the Big Five personality dimensions – Openness to new experiences, Conscientiousness, Extraversion, Agreeableness, and Neuroticism (or OCEAN, for short). We find that each of these dimensions helps us to explain lots of different behaviors that legislators engage in, even after accounting for ideology.”

“Intriguingly, it turns out that personality traits help us to tell a nuanced story of what is going on in Washington. Specifically, it’s not just liberals behaving differently than conservatives. Rather, most of the dysfunction we observe in Congress today is a product of both ideology and changing personality demographics.”

“Our findings show that personality dimensions explain the kinds of bills legislators propose, how often they buck the party line, how they use press releases and Twitter to disseminate information, and more. All together, this leads to a simple but profound conclusion: personality is more than a feeling. It’s a driving force behind partisan, polarizing tactics and it’s reshaping how Washington works.”

What Happens When Technology Displaces Workers?

Eduardo Porter: “It’s hard to overstate the excitement of tech people about what is on the verge of happening to the practice of medicine… A few years ago, this kind of technological development would be treated like unadulterated good news: an opportunity to improve the nation’s health and standard of living while perhaps even reducing health care costs and achieving a leap in productivity that would cement the United States’ pre-eminent position on the frontier of technology.”

“But a growing pessimism has crept into our understanding of the impact of such innovations. It’s an old fear, widely held since the time of Ned Ludd, who destroyed two mechanical knitting machines in 19th-century England and introduced the Luddite movement, humankind’s first organized protest against technological change.”

“In its current incarnation, though, the fear is actually very new. It strikes against bedrock propositions developed over more than half a century of economic scholarship. It can be articulated succinctly: What if technology has become a substitute for labor, rather than its complement?”

Posted at 10:02 a.m.

Study Finds Large Emissions from Shale Gas Wells

“Researchers found higher-than-expected emissions of a potent greenhouse gas emanating from Pennsylvania wells, according to a study published Monday that adds to concerns about the environmental footprint of natural gas,” according to Fuel Fix.

“The study, conducted by Purdue and Cornell universities and published in the Proceedings of the National Academy of Sciences, is the latest to scrutinize methane emissions associated with natural gas development, with implications from New York to Texas.”

“Researchers used a specially equipped airplane to collect samples above the Marcellus Shale in southwestern Pennsylvania. They traced large methane emissions to seven wells that were were being drilled, a phase of operations not normally associated with such high levels. That suggests the U.S. Environmental Protection Agency’s estimates, released in an annual inventory, are not capturing all the released methane.”

More U.S. Consumers are Seeking Medical Care

“A historic slowdown in U.S. healthcare spending in recent years may be drawing to a close,” the Los Angeles Times reports.

“An industry report published Tuesday and healthcare experts point to a steady rise in medical care being sought by consumers seeing specialists, getting more prescriptions filled and visiting the hospital. Other factors such as millions of newly insured Americans seeking treatment for the first time and higher prices from healthcare consolidation could also help drive up costs.”

“Experts aren’t predicting an immediate return to double-digit increases in medical spending. But the emerging trend underscores how difficult it will be for policymakers, employers and health plans to control healthcare costs going forward.”

Posted at 9:56 a.m.

Chart of the Day

spending graphic Chart of the Day

Morning Line: “So far, outside groups have spent $56 million, outpacing every other midterm election to this point and more than doubling 2010 spending (which was $23 million at this point), the previous record year for midterms, according to the Center for Responsive Politics.”

Schlafly Says Women Won’t Find Husbands if Paid Equally

Phyllis Schlafly writes in the Christian Post that providing women with equal pay for equal work would deter their chances of finding a “suitable mate.”

She writes: “Another fact is the influence of hypergamy, which means that women typically choose a mate (husband or boyfriend) who earns more than she does. Men don’t have the same preference for a higher-earning mate.”

“While women prefer to HAVE a higher-earning partner, men generally prefer to BE the higher-earning partner in a relationship. This simple but profound difference between the sexes has powerful consequences for the so-called pay gap. Suppose the pay gap between men and women were magically eliminated. If that happened, simple arithmetic suggests that half of women would be unable to find what they regard as a suitable mate.”

Posted at 7:39 a.m.

What Janet Yellen is Watching

Ylan Q. Mui: In past speeches, Yellen has cited 10 economic indicators that she is watching to determine the health of the labor market. The dashboard not only includes standard measures such as the unemployment rate and payroll job growth, but also average hourly earnings, jobs quits and hires, and long-term unemployment.

Economists Andy Laperriere and Roberto Perli at Cornerstone Macro have summarized these indicators into one handy chart — and it shows just how weak the labor market remains.

yellendash What Janet Yellen is Watching

And here’s what we can extrapolate from the chart about when the Fed might begin to raise interest rates.

yellendashhike What Janet Yellen is Watching

Of course, structural issues in the labor market could cause the Fed to act more quickly, bringing forward the first rate hike to mid-2015, Cornerstone estimates. And if the economy takes off, the Fed may have to move even sooner, perhaps in the first half of next year.

Uninsured Rate Drops More in States Embracing Health Law

Gallup: “The uninsured rate among adults aged 18 and older in the states that have chosen to expand Medicaid and set up their own exchanges in the health insurance marketplace has declined significantly more this year than in the remaining states that have not done so. The uninsured rate, on average, declined 2.5 percentage points in the 21 states (plus the District of Columbia) that have implemented both of these measures, compared with a 0.8-point drop across the 29 states that have taken only one or neither of these actions.”

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Posted at 7:06 a.m.

The Way to Circumvent Roe v Wade

Erika Sanchez at The Guardian: “The Texas legislature has become an extreme example of new restrictions on abortion continuing to sweep statehouses in 2014, and the particulars buried by all those Wendy Davis profiles showcase a slick new tactic of the pro-life movement: a requirement for admitting privileges. At first glance, that kind of rule appears designed to protect women’s health – to have an abortion provider make an arrangement with a local hospital in case of an emergency seems harmless, even helpful.”

“But this law, like so many others in the works, also imposes all kinds of obstacles to providers and clinics actually gaining these privileges. The end result: abortion clinics are shutting down all across the country. And because the (often Evangelical) bill-crafting language is so deceptively reasonable and so effective at defusing public outrage, we might not even have noticed that our constitutional right to safe and legal abortions is being steadily eroded.”

“The admitting-privileges workaround is growing across the country, and at an especially alarming rate in neighboring states around Texas.”

“This is not a coincidence. Lawmakers are not suddenly concerned about women’s health. According to a report by the Guttmacher Institute, in 2013 alone, 22 states adopted 70 different restrictions, including late-abortion bans, doctor and clinic regulations, limits on medication abortions and bans on insurance coverage.”

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