John Cassidy's Blog, page 56

Ryan Budget Shows G.O.P. Stuck in Rah-Rah Land

Here’s all you need to know about the G.O.P.’s effort to face reality, moderate its policies, and present a more coherent policy platform to voters in 2016. David Camp, the Michigan Republican who chairs the powerful House Ways and Means Committee, and who in February introduced a sweeping tax-reform plan that, at least, recognized the basic laws of arithmetic, is leaving Congress. Paul Ryan, the conservative Moses of Capitol Hill, is sticking around. On Wednesday, he unveiled the latest of his right-wing manifestos, thinly disguised as a serious budget, proposing to repeal Obamacare, privatize Medicare, and slash spending on Medicaid and food stamps.

No, it wasn’t an April Fool’s joke. The Republican Party’s reform effort, which was heralded by a March, 2013, internal report that said that the G.O.P. was trapped in “an ideological cul de sac,” is over almost before it had begun. On issue after issue (gun control, immigration, gay marriage, Obamacare, climate change, unemployment benefits, the minimum wage), suggestions that the Party might revise its extreme positions have been stomped on. The ultras have won out. And nowhere is this more true than in the biggest policy area of all: taxes and spending.

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The Education of Bill de Blasio

Ruling from the left is never easy. It’s so hard, in fact, that many progressive politicians think it’s impossible—that’s one reason they tack to the center. In this club, you’ll find Bill Clinton, Hillary Clinton, Tony Blair, Barack Obama, and Andrew Cuomo. During the Clinton and Blair Administrations, I received practically identical briefings from senior officials on both sides of the Atlantic. The days of left-wing populism are over, I was told. Remember what happened to François Mitterrand and Gerhard Schröder, two European Socialists who were forced to reverse course. If you want to get anything done, you have to look responsible, reassure independents that you’re no dangerous radical, and cozy up to business and financial interests. I haven’t heard anybody in the current White House be so explicit. But President Obama, in insuring the passage of the Affordable Care Act and responding to the financial crisis of 2008-09, has largely followed the same script.

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Obamacare: Where Are We Now?

With Monday’s deadline for enrollment in 2014 approaching, Obamacare—sorry, former Speaker Pelosi, but that’s what it’s come to be known as—presents something of a paradox. After the disastrous problems early on with the federal online insurance market, HealthCare.gov, the sign-up process has gone much better than could have been expected a few months ago. But opinion polls show that a majority of Americans still oppose the health-care law. And many Democrats fear that, come November, it could cost them the Senate.

What is going on? First, the numbers. According to the latest figures from the White House, more than six million people have signed up for private insurance policies offered under the Affordable Care Act. Another three or four million low-income families have enrolled in the expanded Medicaid program, and, under a provision of the law introduced in 2010, about the same number of young people have been added to their parents’ private insurance plans. By the Monday deadline, the figures will likely be higher. On Thursday, 1.5 million people visited HealthCare.gov, and more than four hundred thousand people placed calls to the insurance exchange, the Department of Health and Human Services said in a tweet.

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Obama’s European History Lesson

It’s easy to be skeptical about Presidential speeches. Some political scientists and media commentators believe that, in terms of shifting public opinion, they matter barely at all, and in many instances there is something to this view. Once in a while, though, especially when a President is travelling abroad as the leader of the West, it is incumbent upon him to stand up and say something meaningful.

In Cairo, in May, 2009, President Obama managed to do that, delivering a memorable address that upheld democratic values and squarely confronted the battered image of the United States in the Muslim world. Five months later, upon receiving the Nobel Peace Prize in Stockholm, Obama gave another weighty talk, in which, among other things, he defended the concept of a just war. Since then, Obama’s overseas speeches have been less consequential, partly reflecting his decision to step back and husband America’s power. (A cynic might say that if you don’t do very much, there isn’t a lot to explain or defend.)

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Piketty’s Inequality Story in Six Charts

In this week’s magazine, I’ve got a lengthy piece about “Capital in the Twenty-first Century,” a new book about rising inequality by Thomas Piketty, a French economist, that is sparking a lot of comment and debate. (Brad DeLong has a useful summary of some early reviews.) I’ll go further into that discussion in future posts, but first I thought it might be useful to portray the gist of Piketty’s story in a series of charts.

The charts aren’t merely illustrative: they are an essential part of Piketty’s contribution. Fifteen or twenty years ago, debates about inequality tended to be cast in terms of clever but complicated statistics, such as the Gini coefficient and the Theil entropy index, which attempted to reduce the entire income distribution to a single number. One thing that Piketty and his colleagues Emmanuel Saez and Anthony Atkinson have done is to popularize the use of simple charts that are easier to understand. In particular, they present pictures showing the shares of over-all income and wealth taken by various groups over time, including the top decile of the income distribution and the top percentile (respectively, the top ten per cent and those we call “the one per cent”).

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Don’t Cry for the G8: It’s Mostly a Waste of Time

Here’s a question to test your knowledge of international affairs: What do these places have in common? Birmingham, England; Cologne, Germany; Okinawa, Japan; Genoa, Italy; Kananaskis, Canada; Évian-les-Bains, France; Sea Island, Georgia; Gleneagles, Scotland; St. Petersburg, Russia; Heiligendamm, Germany; Lake Toya, Japan; L’Aquila, Italy; Muskoka, Canada; Deauville, France; Camp David, Maryland; Lough Erne, Northern Ireland.

The answer isn’t that they all have their own mineral waters—although some of them are famous spas. They have all played host to meetings of the G8 club of advanced nations, which, at least for now, is back to being the G7—Vladimir Putin’s Russia having been suspended in disgrace for cheating at cards. If you can’t remember all—or even any—of them, don’t be too hard on yourself. Most of these get-togethers are so tedious and inconsequential that many of the diplomats and journalists who attended them can hardly recall them, either.

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Putin Now Faces Threat of Real Sanctions

The Moscow stock market fell sharply on Friday, following the announcement that the United States and the European Union had expanded financial sanctions directed at Vladimir Putin’s political and business associates. Meanwhile, the credit-rating agency Fitch joined its rival, Standard & Poors, in downgrading Russia’s sovereign debt. With a rating of BBB, Russian government bonds are still regarded as investment-grade securities, but only just—and their yields jumped sharply in Friday’s trading, reaching almost 9.5 per cent. That means Putin’s government is already paying a modest price for its annexation of Crimea: since the start of the crisis, its borrowing costs have risen by about one per cent.

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Janet Yellen’s Awkward Day

There is good reason to hope that Janet Yellen may go on to become one of the great leaders of the Federal Reserve: she’s a first-rate economist, a gifted explicator of complicated concepts, and an experienced hand at navigating Washington. (At her first appearance as Fed chief on Capitol Hill, last month, the Republican senators may not have been eating out of her hands, but they treated her with unusual deference.) In policy terms, she’s on the side of the angels: passionately committed to getting the economy growing and bringing down unemployment, particularly for the long-term jobless, who have been the biggest victims of the Great Recession and its aftermath.

On Wednesday, though, at her first press conference as chairwoman of the Fed, Yellen had an awkward time, conveying a message that she may well not have intended to, and spooking the markets. This may not be a big deal: Alan Greenspan and Ben Bernanke made similar errors in their early days and quickly recovered. But it did indicate some of the challenges Yellen faces in extricating the Fed from the emergency policy actions it has taken during the past five years.

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Putin’s Crimean History Lesson

President Vladimir Putin’s defiant speech in Moscow on Tuesday, which he followed up by signing a draft treaty to make the Crimea part of Russia, can be interpreted in two ways. The optimistic reading is that the Russian leader’s revanchism, and his railing against the West, is, essentially, an acknowledgement of his country’s weakness, and of the reduced circumstances in which it finds itself two decades after the collapse of Communism. The pessimistic view is that the effective annexation of Crimea marks the beginning of something new and ominous: not another Cold War but, rather, a revival of a chauvinistic and expansive Russian nationalism that goes back to the tsars.

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Postscript: Tony Benn, 1925-2014

Mr. Maddocks, the metalwork teacher at my high school in Leeds, didn’t think much of Tony Benn, the left-wing English politician who died, on Friday, at the age of eighty-eight. “Gets his orders straight from Moscow, that fellow,” Mr. Maddocks said one day, when Benn’s name came up. Many right-leaning folks agreed with him. During the nineteen-seventies and eighties, Benn was a left-wing bogeyman, a gift to the Fleet Street tabloids, and, to some people who shared his background, a class traitor. (Having inherited the title of Viscount Stansgate, he renounced it in the early nineteen-sixties and shortened his original name, which was Anthony Wedgwood Benn.)

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