Christopher Beam does a nice job at Slate, throwing cold water on the anti-incumbency meme that’s been dominating election coverage.
Sure, a few incumbents have lost in recent months. But, Beam writes, let’s put this in perspective:
So far this year, 282 federal-level incumbents have been up for re-election. Of those, only six have lost their seats—four in the House and two in the Senate. (Aside from Bennett, Kilpatrick, and Specter, there’s Rep. Alan Mollohan, D-W.Va.; Rep. Parker Griffith, R-Ala.; and Rep. Bob Inglis, R-S.C.) That’s 2 percent of all incumbents. If you count only the 119 incumbents who have faced primary challengers, the proportion who were defeated goes up to 5 percent.
That’s a helpful infusion of data. As John Sides wrote on The Monkey Cage, “Kudos to Beam for actually counting both the numerator and the denominator and then dividing. That bit of simple arithmetic seems beyond a great many commentators.”
But there’s also this killer fact, one that explains so much about how Washington works:
The fact is, even an “anti-incumbent” year isn’t that bad for incumbents. The average rate of re-election for members of the House since 1964 has been 93.3 percent. (Over the last decade, it’s been 96 percent.)
Good work. And something to keep in mind the next time voters go to the polls.
—The Washington Independent takes a smart look at something I didn’t think we’d be seeing so soon: the return of the $1,000-down mortgage.
It sounds too good to be true. But it is true. This offer does not come from a subprime lender, looking to reel in thousands of unqualified and ill-advised homebuyers, only to slap them with add-ons, fees and variable rates. It is not a teaser or a trick. The advertisement references a program initiated by the National Council of State Housing Agencies and Fannie Mae, the taxpayer-backed, government-sponsored enterprise that buys up mortgages from lending banks.
The pilot program is called “Affordable Advantage,” and it has now been adopted by three states — Massachusetts, Wisconsin and Idaho. (Other states, such as Pennsylvania, California and Colorado, have similar state programs.) The initiative is small, reaching just a few hundred people so far. But it is looking to expand. Given the dangers of these types of mortgages and the specter of the housing bubble, where unconventional loans wreaked disaster, it is also raising questions from wary housing experts and legislators.
Those questions are too predictable by now, starting with what happens if the housing market turns down, even a little bit, and the homeowner promptly goes underwater.
This is a good piece by TWI (where I used to work), looking a program before it becomes a problem.
—I’m putting together a vacation reading pile, and thought I’d share the latest addition. It comes via Greg Mankiw’s blog, and it’s something we should probably all read soon: a CBO issue brief entitled “Federal Debt and the Risk of a Fiscal Crisis.”
It’s not too terribly long, but it is terribly important. (And that’s not just because I’m the Peterson Fellow.) And this report is easy to understand, especially for the non-experts among us:
One impact of rising debt is that increased government borrowing tends to crowd out private investment in productive capital, because the portion of people’s savings used to buy government securities is not available to fund such investment. The result is a smaller capital stock and lower output and incomes in the long run than would otherwise be the case.
The effect of debt on investment can be offset by borrowing from foreign individuals or institutions. But additional inflows of foreign capital also create the obligation for more profits and interest to flow overseas in the future. Thus, although flows of capital into a country can help maintain domestic investment, most of the gains from that additional investment do not accrue to the residents.
Maybe there will be a quiz when I get back.
Oh, and one more thing. Any thoughts about what else I should put in the to-read pile?
"One impact of rising debt is that increased government borrowing tends to crowd out private investment in productive capital, because the portion of people’s savings used to buy government securities is not available to fund such investment. The result is a smaller capital stock and lower output and incomes in the long run than would otherwise be the case."
That would be the case if government bonds offered low risk and high yields, remember, investment is a choice and investors do not put money in risky propositions that offer little return.
The problem we have right now is that treasury bonds offer really low interest and yet demand is high for them. Why? Because the private sector is too risky. Why? Because there's falling global demand. Government borrowing does not crowd out private investment when private investment is too wary of the private sector to invest in it.
And this is all academic anyways since NO ONE but hippies and freaks who "hate capitalism" were complaining about the debts and borrowing under George Bush. Everyone was celebrating the tax cuts (which produced the need for massive borrowing from the government ) and deregulation/non-regulation (which produced catastrophic instability in the private markets). We do deficit talk when democrats are in charge. When republicans are in charge, the wizards talk about the danger of surpluses crowding out private investment, and the need for deficit inducing tax cuts.
http://yglesias.thinkprogress.org/2010/05/the-forgotten-conservative-campaign-to-save-the-national-debt/
Furthermore, government investment can be just as productive as private investment. Money invested in building green utilities is productive. Those government owned utilities will produce profitable energy, bringing revenue in. In Canada they have Crown Corporations which bring in revenue to the government while supplying commodities to the public at reasonable cost.
There is no reason why government investment has to be unproductive except for a lack of imagination by the political and traditional economic classes.
This is the perfect time to be talking about government spending if it's done right:
http://www.infrastructurist.com/2009/02/02/dukes-place-michael-dukakis-on-how-to-fix-america/
"It was all about the competence of the people running the projects. If I may say, my guys were running the Harbor Cleanup and [former Gov. William] Weld’s guys were running the Big Dig. The reason that the Harbor cleanup was under budget was because the folks running the show in 1989-90 when I was still governor were smart enough to know that you want get out the bid when the economy is down and contractors are hungry. So they bid low. Fine! We accepted their bids. Two or three years later the economy revives and they start piling in with change orders [requesting more money]. Doug McDonald, who at the time was the head of the water resources authority, just sat there and laughed at them. So we got our project on time, under budget. On the Big Dig the change orders must have numbered in the thousands. It’s got everything to do with having people in place who are tough and smart. I had a guy a construction director at the MBTA who was one tough son-of-a-bitch. A career guy who’d been there and knew his stuff. The contractors were scared of him! Work came in on time, on budget, no foolin’ around.
We seem to have gotten to a place where people have forgotten that large public works projects can happen in less than a half a lifetime.
In the 1950s we built the Calahan Tunnel in two years. What the hell are we doing now? Our friends in Europe and Asia still know how to build a tunnel. London has announc
#1 Posted by Thimbles, CJR on Sun 8 Aug 2010 at 05:09 AM
Further essential reading:
http://krugman.blogs.nytimes.com/2009/09/28/crowding-in/
And there will be a quiz.
#2 Posted by Thimbles, CJR on Sun 8 Aug 2010 at 05:12 AM
It's about time CJR got around to calling BS on this "anti-incumbency" fiction.
What we are witnessing is anti-Obamunism, plain and simple. You are seeing an American President fall on his face faster than any of his predecessors, and the people who put their necks furthest on the block (like Specter and Bennett) are just the tip of the iceberg. Wait till you see Harry Reid's poll numbers before you jump to any conclusion.
Bowing to world leaders.. Cowtowing to radical thugs. Announcing a pull-out date to our enemy in Afghanistan. Playing more golf in his first year than Bush did in 8 years while more soldiers die on his watch every month . Avoiding press conferences. The health care debacle. Broken promises left and right. Barbecues with Farrakhan cronies. Vacation after vacation. Etc. Etc. Etc. Obama has made a fool of himself and is a disgrace to his office.
We are seeing the entirely predictable outcome of electing a man who hasn't run a damned thing in his life to the most important job on the planet.
The American people aren't going to buy into his belt-tightening plan while his wife and kids bilk the taxpayers out of a half million dollars to take the Entourage on a five-star junket in a foreign country. (When our own tourism industry needs every dime it can get).
In about 90 days, you "professional journalists" will be reporting on the "unexpectedly" high margins that put anti-Obamunist candidates into office in droves in the "surprise" election.
#3 Posted by padikiller, CJR on Sun 8 Aug 2010 at 10:22 AM
It's like reading a fox news rss feed.
PS: Bush spent a third of his tumultuous presidency on vacation.
http://www.washingtonpost.com/wp-dyn/content/blog/2008/03/04/BL2008030401392.html
Not that you'd care, but I just thought your Fox News taking point needed a little context as to where they're coming from and where they've been, or not been, before.
PPS. Nobody criticized the Bush daughters nor Mrs Bush for taking trips and the security detail costs associated with that.
You guys are f'in nitpickers when you're out of power.
PPPS :http://www.youtube.com/watch?v=Z3p9y_OEAdc
There are good reasons to criticize president Obama. This rss garbage is unserious bullshit.
#4 Posted by Thimbles, CJR on Sun 8 Aug 2010 at 11:32 AM
The "Bush did it" meme doesn't cut it anymore, Thimbles... Obama doesn't get a free ride because Bush did.
You might not be angered by the "Fox News talking points"... But most Americans are, as you will see a couple of months. They don't like seeing their President bow before world leaders, and they don't like the communist left-coast nonsense Pelosi and Reid are dumping on the country..
Obama is toxic. Here in Virginia, Rep. Tom Periello, the shining star of 2008, will go down in flames to a mainline Republican state politician., but you won't see Obama helicoptering in to save the day. Rick Boucher, a 13 term Dem. from southwest Virginia is running TV ads that don't even mention the Democratic Party, not even in the fine print, though they do prominently proclaim his vote against Obamacare.
The backlash will ruin Obama - he likely won't even have the power to eek anything out of the lame duck Congress.
And the MSM will be there to report on the "unexpected" GOP landslide.
#5 Posted by padikiller, CJR on Sun 8 Aug 2010 at 02:54 PM
"You might not be angered by the "Fox News talking points"... But most Americans are"
That most americans are, assuming that's true, does not change that fact your litany above isn't oversensitive, nitpicking, trivial BS.
There are reasons to be mad at Obama. That his family spent some time in Spain isn't one of them.
And I'm sorry, but your movement went from worshipful devotion of a c student incompetent who's only gift was that of nepotism to HATRED AND DISGUST AT THE UNAMERICAN WAY THE PRESIDENT BREATHES OXYGEN!
Fox News and the conservative media should always be reminded about the way they provided cover to their guy while shouting "CLINTON CLINTON CLINTON" whenever they tear after this guy shouting "MUSLIM SOCIALIST MUSLIM SOCIALIST!"
It has not been healthy for anyone to listen to all that shouting. Why? Because they are inconsistent and insane.
The fact is the democrats are bad, very bad. They're owned considerably by banks and industries. They fight for loopholes and water down proposed regulations and won't even bring progressive legislation to a vote. They refuse to stand for their values, preferring to deal make with lobbyists and "moderate" republicans who will refuse to vote for the compromised legislation, no matter what deal they've been given. The democrats have been awful.
But eight years of the republicans have shown them to be scum. They are the ones who put us into this mess and they continue to work for the interests of their party above the interests of their country and constituents. And the reason why the public doesn't hold them more accountable is because
a) the president decided not "to look back" because he wanted to be a nice conservative guy who's friends with everybody.
b) you people are focused more on the way the president "Bows" versus the way the president leads. You don't know how to run a country, a war, a government budget, an economy therefore you don't know how to criticize based on substance. Fox News doesn't know how to criticize based on substance. You praised the style of George Bush when he was in office and you criticize the style of Obama because that is all you understand about governance.
How it's supposed to look, not how it's supposed to work. (Wow Reagan did a great job. He chopped wood like a real leader. OMG Obama played golf. We need a leader who chops wood!)
So long as this is the depths of your understanding of issues and governance, you will be vulnerable to con-artists and crooks who use charismatic actors and lenient press to cleverly wrapped crap candidates.
To a certain extent that includes Obama. Many people believed he was going to change washington, bring public health care, end the war, reform the banks, improve the schools, and bring about a resurgence in the greatness that was liberal America.
But I knew from his words and policies that he was a conservative. The Hope and Change was clever marketing. I knew this in 2007:
http://www.correntewire.com/obama_stump_speech_strategy_of_conciliation_considered_harmful
(not my post, but one I cited often) And everything I've seen out of this whitehouse confirms that, from his picks to his important commissions, to the way he hesitates to throw small bones (such as an Elizabeth Warren appointment) to his base, to the way he treats he negotiates with himself before proposing legislation (throwing out his base's most prized priorities) and then let's the republicans and conservative democrats tear them apart with pressure only being applied to his allies, he is conservative.
But according to the Fox News style manual "He's a socialist!" Obamunism you say. That is the comment of an idiot. Name a socialist policy. Name one that suits the definition. If anything, the government has been
#6 Posted by Thimbles, CJR on Sun 8 Aug 2010 at 05:53 PM
The above was written while I was very tired from working on other projects, please excuse the couple of instances where my train of thought got derailed grammar wise.
In other news, this is Obamaunism:
http://www.nytimes.com/2010/08/09/opinion/09krugman.html
"We’re told that we have no choice, that basic government functions — essential services that have been provided for generations — are no longer affordable. And it’s true that state and local governments, hit hard by the recession, are cash-strapped. But they wouldn’t be quite as cash-strapped if their politicians were willing to consider at least some tax increases.
And the federal government, which can sell inflation-protected long-term bonds at an interest rate of only 1.04 percent, isn’t cash-strapped at all. It could and should be offering aid to local governments, to protect the future of our infrastructure and our children.
But Washington is providing only a trickle of help, and even that grudgingly. We must place priority on reducing the deficit, say Republicans and “centrist” Democrats. And then, virtually in the next breath, they declare that we must preserve tax cuts for the very affluent, at a budget cost of $700 billion over the next decade.
In effect, a large part of our political class is showing its priorities: given the choice between asking the richest 2 percent or so of Americans to go back to paying the tax rates they paid during the Clinton-era boom, or allowing the nation’s foundations to crumble — literally in the case of roads, figuratively in the case of education — they’re choosing the latter. "
http://emptywheel.firedoglake.com/2010/08/07/obamas-relentless-abandonment-of-progressive-nominees/
"if you listened to, and read Obama, and paid attention, you knew he was a centrist who worked by increment, compromise and seeking consensus as opposed to a liberal beacon that would take the country in a new and markedly different direction. Again, that said, the liberals and progressives who served as the ground force, heart and soul of Obama’s candidacy and election had every right to believe he would would at least include them at his table and utilize their talents in his Administration and appointments. There was an implicit deal made in this regard, and Obama purchased on it to his wild success. Now he has defaulted...
Most distressing to me, because I practice law in the 9th Circuit, is the complete abandonment of two critical liberal judicial nominees, Goodwin Liu and Edward Chen; you may not be aware of because their nominations were tanked in the quiet of the night before those oh so hard working and diligent souls in the United States Senate jetted out of town for a 37 day vacation. Because Senate Rule XXXI specifies that all nominations not voted on and not held over by unanimous consent are extinguished and returned to the White House, the Liu and Chen nominations are toast.
Some of the still starry eyed Obama true believers who care about Liu and Chen (and both are incredibly excellent and worthy nominees) probably still think Obama will renominate them (and there is mention of that by, of course, an anonymous “White House official”). But even if he did, why in the world would anybody believe it to be anything other than a ruse to get their support leading up to the fall election? Obama renominated Dawn Johnsen and then hung her out to dry twisting in the wind until she finally ended the charade. It was a charade to sucker progressives, and there is no reason to believe he will not do it again. There is a track record with this White House, and it is not a good one; in fact, it is downright pathetic...
that is the hallmark of the Obama Presidency in relation to liberals
#7 Posted by Thimbles, CJR on Mon 9 Aug 2010 at 06:57 AM
Krugman's stance is self-contradictory.
He's a smart guy, and he wants to be impartial and scientific, but he just can't separate econcomics from politics.
He wants to a be a good '60s commie, but he's too smart to drink the Kool-aid.
He advocates for the welfare state from a purely political motivation, while he simultaneously concedes that free markets are the only way to improve the social condition.
He never has provided any plausible, practical model that harmomizes the welfare state with a free market economy.
Conflicted.. A classic case of confliction.
#8 Posted by padikiller, CJR on Mon 9 Aug 2010 at 07:40 AM
Support any of that. Where's your documentation?
A classic case of "my dog ate my homework".
Meanwhile, about that free market:
http://www.rollingstone.com/politics/news/17390/188551
"The huge profits that Wall Street earned in the past decade were driven in large part by a single, far-reaching scheme, one in which bankers, home lenders and other players exploited loopholes in the system to magically transform subprime home borrowers into AAA investments, sell them off to unsuspecting pension funds and foreign trade unions and other suckers, then multiply their score by leveraging their phony-baloney deals over and over. It was pure financial alchemy – turning manure into gold, then spinning it Rumpelstiltskin-style into vast profits using complex, mostly unregulated new instruments that almost no one outside of a few experts in the field really understood. With the government borrowing mountains of Chinese and Saudi cash to fight two crazy wars, and the domestic manufacturing base mostly vanished overseas, this massive fraud for all intents and purposes was the American economy in the 2000s; we were a nation subsisting on an elaborate check-bouncing scheme.
And it was all made possible by two major deregulatory moves from the Clinton era: the Gramm-Leach-Bliley Act of 1999, which allowed investment banks, insurance companies and commercial banks to merge, and the Commodity Futures Modernization Act of 2000, which exempted the entire derivatives market from federal regulation. Together, these two laws transformed Wall Street into a giant casino, allowing commercial banks to act like high-risk hedge funds, with a whole new galaxy of derivative bets to lay action on. In fact, the laws made Wall Street even crazier than a casino, because in a casino you have to put up actual money to make bets. But thanks to deregulation, financial companies like AIG could bet billions, if not trillions, without having any money at all to back up their gambles...
If Obama's team had had their way, last month's debate over the Volcker rule would never have happened. When the original version of the finance- reform bill passed the House last fall – heavily influenced by treasury secretary and noted pencil-necked Wall Street stooge Timothy Geithner – it contained no attempt to ban banks with federally insured deposits from engaging in prop trading. But that changed when Scott Brown, the Tea Party darling from Massachusetts, blindsided the Democrats by wresting away the seat of deceased liberal icon Ted Kennedy. With voters seething over Wall Street's rampant thievery and fraud, the Democrats suddenly got religion about reckless gambling by the financial industry...
It didn't work out that way. The counter attack began in May, when the Republicans objected to Merkley-Levin and invoked the Senate's unanimous-consent rule, by which no amendment comes to the floor unless all 100 members agree to let it be voted on. That left the Volcker rule in legislative purgatory right up to the initial Senate vote on the bill. In interviews, the soft-spoken, gregarious Merkley steadfastly refuses to point the finger at the Democratic leadership for failing to break the legislative logjam. But reading between the lines, it's obvious that he and Levin were on their own – no one with any juice in the key committees lifted a finger to help them. The two senators were like underage geeks who'd been told by Majority Leader Harry Reid that they had to come up with their own keg if they wanted to come to the party.
But come up with a keg they did...
Or so they thought. "We were plumbing the inner rules of the Senate," Merkley says. One of those rules is that when you attach your amendment to another, your measure has to be "germane" to the amendment you're attaching it to. Since Merkley-Levin's ban on prop trading and Brownback's a
#9 Posted by Thimbles, CJR on Mon 9 Aug 2010 at 09:36 AM
CBO response. Watch:
http://neweconomicperspectives.blogspot.com/2010/07/rab-capitals-marshall-auerback-on-cbos.html
#10 Posted by Thimbles, CJR on Mon 9 Aug 2010 at 03:17 PM