Obama Needs "Emotional Moral Clarity" for Obamacare

Michael Zuckerman contends that “President Obama’s new push to ‘sell’ the law … risks devolving into transactionalism … To make the case, Obama needs to strike the sustained, emotional moral clarity—consistent claims that go beyond economic benefits—that helped bring him to Washington in the first place.”

“For supporters of progressive taxation, the social safety net, and the responsibility to heal the sick, that rationale for shying away from moral claims is misguided to the point of self-sabotage. Adding a set of bold moral arguments for healthcare reform to a recitation of the program’s transactional benefits is a winning strategy for three main reasons.”

  • First, the risk is not that high.
  • Second, it’s better than being ignored.
  • Third, Obama is the standard-bearer of a party in the midst of a fight over the validity of its philosophical underpinning.

Martha Nussbaum: “Ceding the terrain of emotion-shaping to antiliberal forces gives them a huge advantage in the people’s hearts and risks making people think of liberal values as tepid and boring.”

Republicans' "Callous" Crusade Against Unemployment Benefits

Calling Republicans’ policy to end the extension of unemployment benefits, “a perfect marriage of callousness — a complete lack of empathy for the unfortunate — with bad economics,” Paul Krugman makes the case that it “is an especially clear example of superficially plausible but wrong economic ideas being dangerous for evil.”

“The view of most labor economists now is that unemployment benefits have only a modest negative effect on job search — and in today’s economy have no negative effect at all on overall employment. On the contrary, unemployment benefits help create jobs, and cutting those benefits would depress the economy as a whole.”

“The point is that employment in today’s American economy is limited by demand, not supply. Businesses aren’t failing to hire because they can’t find willing workers; they’re failing to hire because they can’t find enough customers. And slashing unemployment benefits — which would have the side effect of reducing incomes and hence consumer spending — would just make the situation worse.”

Volcker Rule Test Imminent

With the final version of the Volcker Rule due out on Tuesday, the focus is on whether it will be tough enough.

Bloomberg View: Although “Volcker’s simple concept has prevailed … in other areas, the regulators have compromised. The rule probably won’t stop banks from designating some proprietary trades as ‘market-making’.”

“Perhaps the best gauge will be how much trading migrates from the largest firms to independent brokerages, hedge funds and other institutions that have been squeezed out of the business … The Volcker rule, along with higher capital requirements, will minimize … subsidies [for big banks], which should make trading less profitable for banks and create opportunities for nonbank rivals.”

The Washington Post outlines areas to pay attention to:

  • Portfolio hedging. Early leaks suggest that portfolio hedging won’t be allowed under the final version of reform.
  • Market-making. Keep an eye on which agency will actually enforce these rules for which part of the bank, and how the agencies will coordinate that.
  • Implementation. The rule will point to actual concrete things we can look at in six months to see if the rule is having an effect [and] we should expect to see the people focused on [market making and client services] thrive.

Obamacare Success Depends on the Politics

Ross Douthat calls for cautious optimism that Obamacare’s troubles are over, arguing that implementation of the law long-term “actually depends on the law’s political standing.”

“That’s because the law can work only if people who don’t necessarily benefit immediately from its provisions decide to participate anyway.”

“But the mandate’s penalty is relatively modest and its enforcement mechanisms relatively weak, which means its power ultimately depends more on civic duty than on immediate self-interest.”

And recent polls “suggest that [among the traditionally pro-Obama millennials] the political emotions stirred up by the rollout — frustration, disillusionment, anger — could have substantial consequences for sign-up rates as well.”

“Now, though, the fate of [the Obama administration’s] policy may depend on not only reaching them, but reconverting them as well.”

Poll: Majority of Americans Want Major Changes to Obamacare

A new Gallup poll shows that “the percentage of Americans who prefer that Congress scale back or entirely repeal the Affordable Care Act (ACA), or “Obamacare,” has changed little. Fifty-two percent favor scaling back (20%) or repealing (32%) the law, similar to the 50% from mid-October.”

Bottom Line: “Despite HHS’s announcement on Dec. 1 that the technical issues have been mostly fixed and reports of 29,000 new enrollees in the days thereafter, Americans so far are no less likely to say Congress should repeal the law or scale it back.”

“Americans’ views about congressional action on the healthcare law have remained steady, and it is unclear whether they will budge in the months to come.”

Why Millennials Will Come Around on Obamacare

Ryan Cooper tells us not to worry about enrollment by millennials and gives 6 reasons why:

  1. Young people are not actually invincible. [They] can be turned in an instant to people with pre-existing conditions — which is to say, people who will benefit from the protection of Obamacare.
  2. Going without insurance is morally wrong. Getting insurance will be part of living in a decent society where everyone chips in when they can afford it, and free-riding is frowned upon — and over time, young people will come to see this as part of being a responsible citizen.
  3. It’s the law.
  4. People haven’t grasped how the subsidies work yet. Once the range of financial help trickles through the national consciousness young people will be surprised at the prices on offer.
  5. Pressure from mom and dad.
  6. Being uninsured sucks!

Most importantly: “the White House has a long time to bring about this change.”

House and Senate Near Budget Deal

The New York Times reports that the House and Senate is close to sealing a budget deal despite “last-minute resistance from House Democratic leaders who said any deal should be accompanied by an extension of expiring unemployment benefits for 1.3 million workers.”

“The deal would increase revenue by raising some fees and would shift some cuts away from domestic and defense programs, partly alleviating the squeeze of across-the-board spending cuts imposed last year, which are set to worsen in 2014. Spending on defense and domestic programs would rise to about $1 trillion … Absent a deal, further cuts would go into effect in January, and discretionary spending would be cut to $967 billion for fiscal 2014.”

“But the agreement would leave to future negotiations the big issues of curbing future spending increases in the fast-growing entitlement programs and the proper level of tax revenues. It also would not extend unemployment benefits set to expire Dec. 28, or deal with impending cuts to Medicare health care providers.”

But Roll Call notes Speaker John Boehner tempered expectations for a deal on the budget, “saying neither issue appears to be poised for conclusion.”

National Journal: “The details of a potential budget deal are trickling out, and nobody seems thrilled with what they’re hearing.”

Ethanol Battle Flares Again

Arguments over the renewable fuel standard heated up at an EPA public hearing Thursday.

Reuters reports that “about 300 people attended [the hearing on the] proposed changes which have become one of the most divisive policy issues of the year.”

“The meeting comes nearly three weeks after the Obama administration proposed slashing how much renewable fuel – mostly corn-based ethanol – needs to be blended into the U.S. fuel supply, bowing to pressure from the petroleum industry.”

“The EPA has warned that the country is approaching a point where the RFS would require the use of more ethanol than can be blended into gasoline at the 10 percent level that dominates the U.S. fueling infrastructure.”

“Refiners have said this so-called “blend wall,” if left in place, would force them to export more fuel or produce less gasoline, leading to shortages and higher prices at the pump.”

“Ethanol supporters and the biodiesel industry have warned that the lower mandate could seriously hurt U.S. corn prices by undercutting demand from refiners, and trigger job losses across rural America.”


									

Debate Over Economic Benefits of Minimum Wage Increase

As fast food workers carry out a nation-wide strike to demand a $15 minimum wage, the New York Times covers the debate  over the economic implications of such an increase.

Economics professor Arindrajit Dube:  “There are concerns that [a $15 wage increase] might lead to the substitution of automation for workers.”

“David Neumark, an economics professor at University of California, Irvine, estimated that raising fast-food pay to $15 would result in a 5 percent or 6 percent reduction in employment [but] would save the government money by reducing workers’ reliance on food stamps and other programs.”

“Some economists maintain that giving raises to low-paid fast-food and retail workers would stimulate the underperforming economy by increasing their ability to spend.”

“But other economists counter that the stimulus would be negated when the raises forced restaurants and retailers to raise prices, subtracting from other consumers’ spending power.”

David French, of the National Retail Federation: “There’s been a lot of growth of jobs in the retail and service sector. It’s been one of the bright spots. Why then should the policy response be to create fewer jobs? That’s a bizarre remedy to a crushing problem.”

3 Signs That Healthcare.gov is Working

The National Journal lists the three indicators that prove Healthcare.gov is really working:

  1. Republicans have mostly stopped attacking the website: House Republican talking points shared with National Journal … barely touches on the website.
  2. Democrats have calmed down: The White House has moved into sales mode on the health care law, while the Democratic Congressional Campaign Committee and others have transitioned—if tepidly at first—into offense.
  3. The media has started to move on: In mid-November, the Washington media narrative was entirely dominated by problems with the website … Since the website relaunch Sunday, coverage has been more diverse … and more nuanced when it comes to Obamacare.

Corporations Evolve On Climate Change Policy

The New York Times reports that “more than two dozen of the nation’s biggest corporations, including the five major oil companies, are planning their future growth on the expectation that the government will force them to pay a price for carbon pollution as a way to control global warming.”

“Both supporters and opponents of action to fight global warming say the development is significant because businesses that chart a financial course to make money in a carbon-constrained future could be more inclined to support policies that address climate change.”

“Past efforts to enact a carbon price in Washington have failed largely because powerful fossil-fuel groups financed campaigns against lawmakers who supported a carbon tax.”

Why We Need to Care About the Lower Middle Class

In a thought-provoking piece, Vauhini Vara dissects the meaning of what it is to be lower-middle-class (30% of families in America) and why it matters.

“Many of these lower-middle-class families [(with annual incomes between $15,000 and $60,000)] are still struggling to get by … All told, more than thirty per cent of lower-middle-class people receive food stamps, unemployment benefits, welfare, or other benefits.”

“This matters for a couple of reasons. It reframes how we think about the people who access government benefits. Many of them, it turns out, are married, college educated, and working—that is, people whose choices reflect traditional values and whose plight should inspire sympathy from both the political left and right. And it highlights the structural problems that make it difficult for lower-middle-class families to make ends meet and to rise into a higher income bracket.”

Vara contends that an understanding of this demographic group is critical in formulating policies to address inequality.

In recent years, the cultural conversation about inequality has focused on the rich and poor themselves … But the problem … is structural. Over time, we have set up an economic system that breeds inequality.

 

Young Invincibles Disapprove of Obamacare

One of Obamacare’s key target groups – the ‘young invincibles’ – remains “skeptical of the healthcare reform law,” according to The Hill.

“A poll released Wednesday by Harvard University’s Institute of Politics found that more than half of 18- to 29-year-olds disapprove of ObamaCare and believe it will raise their healthcare costs.”

“Insurance coverage of any kind remains a tough sell for people in their twenties, many of whom are eligible to stay on their parents’ plans through age 26.”

“Critics have long charged the Affordable Care Act is a dramatic transfer of resources to older people, and many young people might not see enrollment as being in their financial interest.”

“The architects of the healthcare law had hoped that the individual mandate, which requires most people in the country to either obtain insurance or pay a fine by 2014, would help avoid the ‘death spiral.'” Many young people are choosing to simply pay the low first-year penalty of $95.

“Supporters and opponents of the healthcare law have long seen the enrollment of young people as a central battleground, and both sides are laying the groundwork for an ad war.”

NSA Tracks Billions of Cell Phone Locations Daily

The Washington Post reports that according ton top-secret documents provided by Edward Snowden, “the NSA is gathering nearly 5 billion records a day on the whereabouts of cellphones around the world … enabling the agency to track the movements of individuals — and map their relationships — in ways that would have been previously unimaginable.”

“The records feed a vast database that stores information about the locations of at least hundreds of millions of devices … New projects created to analyze that data have provided the intelligence community with what amounts to a mass surveillance tool.”

The scale and scope of the operation is unprecedented. “Analysts can find cellphones anywhere in the world, retrace their movements and expose hidden relationships among the people using them.”

“The government is tracking people from afar into confidential business meetings or personal visits to medical facilities, hotel rooms, private homes and other traditionally protected spaces.”

The NSA justifies its surveillance abroad, claiming that “when U.S. cellphone data are collected … [they] are not covered by the Fourth Amendment.”

“The NSA’s capabilities to track location are staggering … and indicate that the agency is able to render most efforts at communications security effectively futile.”