Larry Summers: A Gas Tax to Fix America’s Roads is a ‘Free Lunch’

Lawrence Summers argues that “maintaining our infrastructure directly benefits American families and businesses because with fewer potholes they have to spend less maintaining their vehicles. This effect turns out to be surprisingly large. TRIP, a transportation research group, estimates that the cost to motorists of driving on roads in need of repair in 2013 was $109 billion. This includes only extra vehicle repair and operating costs, and not the delays caused by driving on poor roads, so it is almost certainly an underestimate. On the other hand, even with proper polices, some potholes would remain. To be very conservative, assume that proper infrastructure investment policies would save motorists half the total, or $54 billion a year.”

This figure “is comparable to total consumer spending of $49 billion on air transportation or $53 billion on personal computers. As another way of seeing its magnitude, it works out to 40 cents per gallon of gasoline consumed in the United States.”

“So if we were able to raise the gas tax by 40 cents and repair our highways and roads, we would create no new net burden on consumers: The benefit in reduced vehicle operating costs would at the very least offset their higher gas bills. In fact, since our cost estimate is conservative, the net effect on consumers would most likely be positive. And as is fair, those who drive the most would both pay the most and benefit the most from reduced repair costs.”

Obamacare No Longer an Issue in Democratic Debate

Jeffrey Young in Huffington Post: “President Barack Obama’s landmark health care reform law — one of the most contentious political issues of the past six years — received all but no attention during the Democratic debate Tuesday tonight. But considering that all five Democrats on the stage were supporters of the Affordable Care Act, perhaps it’s not surprising that CNN opted to raise issues more likely to provoke confrontation.”

“Earlier in the debate, former Secretary of State Hillary Clinton mostly evaded a question about Sanders’ advocacy for single-payer health care, merely saying, ‘We agree on the goal. We just disagree on the means.’ Sanders has long proposed allowing everyone to enroll in Medicare, … Clinton, by contrast, favors strengthening the structures created by the Affordable Care Act.”

“That was about as fiery as it got for an issue that’s become so partisan it seems scarcely worth discussing during a primary debate. Obamacare also barely came up when the Republican candidates gathered for their second primary debate last month.”

Congress’ ‘Pathetic’ Response to Transportation

Washington Post Editorial Board: “Congress is poised to temporarily patch the country’s transportation funding system — like it has nearly three dozen times over the past several years. Each time this number ticks up it underscores Congress’s dysfunction. Privately, many members of Congress know that raising the federal gas tax is a ready and reasonable way to pay for the nation’s infrastructure. Publicly, most lawmakers are too spineless to face up to this reality. The result has been impasse after impasse as Congress has attempted to find money elsewhere — leaving the country’s investment in roads, rails and bridges on short-term and unsustainable footing.”

“The whole spectacle is, well, pathetic. A sustainable source of funding to maintain and upgrade infrastructure is a basic requirement for any modern nation. Congress had one for decades. But the 18.4 cents-per-gallon gas tax hasn’t been increased since the early 1990s, and inflation has eroded its purchasing power. Modestly hiking the tax — and indexing it to inflation this time — would prevent Congress from having to constantly look under the cushions in search of money for the transportation budget. It would also make drivers pay for the roads they use. Waiting until 2017, or even until December, won’t alter that logic.”

Midwest Leads in Financial Well-Being; South Lags

Gallup: “Hawaii residents had the highest financial well-being in the nation in 2014, followed closely by Alaska residents. Mississippi residents had the lowest financial well-being, with Tennessee not far behind.”

Mapgraph-FinancialWellbeing2014-state

“Midwestern states earned six of the 10 highest financial well-being scores, while Southern states accounted for all of the 10 lowest financial well-being scores. Differences in income, employment and age — all of which are linked to financial well-being — could help explain the regional pattern.”

“While they avoided being among the bottom 10 states for overall financial well-being, New Jersey had the lowest percentage of residents reporting that they did not worry about money in the past week, and Rhode Island had the lowest percentage of residents saying they were satisfied with their standard of living.”

 

What Happened to American Optimism?

Ronald Brownstein, writing in The Atlantic, comments on the latest Allstate/National Journal Heartland Monitor Poll.

“The new poll asked respondents to consider whether six of the social and economic dynamics that are crucial to the nation’s future make them ‘more optimistic or more pessimistic about the direction the country is headed.’ Only two of the six trends made a majority of respondents feel more optimistic. A resounding 78 percent said ‘continuing advances in computer and communications technology’ made them feel better about the nation’s future.”

“Politically, these trends converge to produce a chasm between the parties over the long-term impact of America’s growing diversity. The Republican electoral coalition now relies heavily on blue-collar and older whites, while Democrats depend mostly on Millennials, minorities, and socially liberal whites with a college education. By an overwhelming margin of 67 percent to 26 percent, more Democrats are optimistic than pessimistic about the implications of these demographic changes for America’s future. Independents are nearly as sunny: 57 percent of them say they’re pleased, compared to 33 percent who fear the implications.”

“In follow-up interviews, Republicans and Democrats alike lamented that political leaders have lost the capacity to forge consensus. ‘The ability to compromise has actually become stigmatized,” said Campbell, the North Carolina Democrat. “Those who are capable of reaching across the aisle from either direction are being lambasted by their own party members to get in line.’”

Wall Street Places Big Bets on Republicans

Paul Krugman comments on the “remarkable piece of reporting by Confessore, Cohen, and Yourish [that] documents the remarkable fact that campaign finance this election cycle is dominated by a tiny number of extremely wealthy people — more than half the total from just 158 families. This money is overwhelmingly flowing to Republicans.”

Political contributions of hedge funds

Political contributions of hedge funds: Opensecrets.org

“Some analysts suggest that this is just because there’s more action on the Republican side, with the field still wide open. But I’m pretty sure that’s nothing like the whole story. The biggest piece of the super-rich-super-donor story is money from the financial sector. And there has, as the chart above shows, been a huge swing of finance capital away from Democrats to Republicans that began in the 2012 election cycle — that is, after the passage of financial reform. Basically, we’re looking at the people who brought you the financial crisis trying to buy the chance to do it all over again.”

How Do Texans Like to Cuss?

Washington Post: “Conventional wisdom has it that the coasts of the United States — especially the Northeast and the West Coast — are more vulgar than the rest of the country. Blue states in these regions tend to have more socially liberal residents and fewer religious conservatives, the reasoning goes. Ipso facto: Fouler mouths.”

“And that holds true — for the most part. But when it comes to swear-word substitutes, middle America isn’t exactly on the same page.”

“Linguist Jack Grieve of Aston University in the United Kingdom is known for studying what cuss words Americans say, and which words are preferred in certain regions. The maps below are based on data from nearly 9 billion tweets.”

“The word ‘crap’ is a favorite in Texas, the lower Midwest, the Upper South and … wait for it … Utah.”

Presidential Candidates: The More Inexperienced the Better

Jonathan Rauch in The Atlantic observes that Americans are trending more toward inexperienced candidates for the presidency.

“The chart below shows the experience level of presidential winners and losers from 1960 to 2012. (For the purposes of this graph, experience equals years between first election to a governorship, a Senate seat, or the vice presidency and election to the presidency; the trend lines do not change much if House experience is included.)”

“Starting in 1996, the candidate with more experience begins consistently losing. Moreover, as the trend lines show, the inexperience premium has increased over time. That makes some sense: As voters have grown angrier with government, they have become more receptive to outsiders. Republicans, in general, are especially angry with government, so no one will be surprised to learn that since 1980 their presidential candidates have had, on average, three to four years’ less experience than the Democrats’ candidates.”

Republican Candidate Favorability Across GOP Segments

Gallup: “A special Gallup analysis of how Republicans and Republican-leaning independents feel about the leading Republican presidential candidates shows each has a unique fan base within the party.”

CanidateStrengthWeaknesses_v9

“One important example is ideology. These results show that very conservative Republicans are more positive about many of the candidates, but that Chris Christie and Jeb Bush are clear exceptions to this tendency. This could have consequences in primary voting if highly conservative Republicans are those most likely to turn out and vote. Another example is provided by ethnic differences. Though Hispanic Republicans may not be a large part of the GOP primary voting population, the fact that Bush and Rubio do well, and Trump does poorly among this group could have consequences further down the line if one of these three were to gain the Republican nomination.”

Do You Live Near a Toxic Superfund Site?

Eco Watch: More than 1,300 Superfund sites are littered across the U.S. These are the places that the U.S. Environmental Protection Agency (EPA) has deemed so contaminated with hazardous waste that they need long-term response plans to deal with the clean up … Most are much more inconspicuous and their whereabouts aren’t always obvious to the public.

A screenshot of the interactive map Brooke Singer developed for ToxicSites. Photo credit: ToxicSites.us

“Media artist Brooke Singer decided to do something about it. Her new website, ToxicSites, features an interactive map, detailing all existing Superfund sites and updated in real-time as the EPA adds more data. Click on one of the colored dots and you’ll get all kinds of information about the company responsible, the contaminants involved, the possible health concerns and the populations living nearby.”

The Koch Brothers Like Government Handouts

Joe Nocera finds that the Koch brothers have no problem accepting government handouts despite their longstanding opposition to “corporate welfare.”

Nocera points to a 2013 investment by Koch Minerals in a Big River Steel project that benefited from “an $800 million 10-year loan from a German bank, KfW IPEX-Bank. That loan, in turn, was contingent on credit insurance provided by Euler Hermes, a credit agency like the Export-Import Bank of the United States.”

“In doing so, of course, the Kochs were taking advantage of the same ‘corporate welfare’ they had long condemned — while relying on the kind of government credit agency they are trying to dismantle in America.”

“Koch-funded groups have led the battle to defund the Ex-Im Bank, which Congress declined to reauthorize this summer, in part because of pressure applied by those groups.”

But “the Big River Steel project offers a clear illustration of why those who want to put the Export-Import Bank out of business are dead wrong.”

“‘Because of the size of the loan and the 10-year repayment period, private insurers would not have wanted to pick it up … And banks wouldn’t have touched it with a 10-foot pole … ‘This is exactly what export credit agencies are good at:’ … stepping in to complete deals that make business sense but need the backing of a sovereign to complete.”

Which Jobs Are More Desirable than House Speaker?

Washington Post: “The speakership of the House is one of those things no one wants to be stuck holding, like a hot potato, a murder weapon or a hot potato that was used as a murder weapon earlier.”

Here is a ranking of jobs more desirable than speaker of the House.

10) “Hunger Games” Tribute

9) Garbage Collector:

8) Cat Herder

7) Tom Hanks In “Castaway”

6) Sisyphus: Same frustrating feeling that “at the end of the day, I’ve accomplished something — wait, no.”

5) “Star Trek” Guy In A Red Shirt Who Always Dies First

4) Aaron Burr Impersonator: Some people now find Aaron Burr relatable.

3) Dentist: This job also requires you to do something that is like pulling teeth but in the end you actually have pulled a tooth out.

2) Whipping Boy: Not to be confused with the Majority Whip, this person also bore the punishment when somebody else (the king’s son) does something wrong — but at least he occasionally got an earldom out of it.

1) Daycare Provider: They cry, they throw tantrums, they scribble graffiti on the walls, they foil all your attempts at discipline, but your charges will eventually grow up.

Good News for Coal: It Can’t Get Much Worse

Bloomberg: “Here’s some good news for a downtrodden U.S. coal industry: next year can’t get much worse after a disastrous 2015.”

“Most utilities that are able to switch to cleaner burning and cheaper natural gas have already done so, resulting in coal losing 10 percent, or 80 million tons, of demand, BB&T Capital Markets said in a report Tuesday.”

“President Barack Obama’s Mercury and Air Toxics Standards, which were implemented this year, spurred a rash of coal-fired power plant closures. Meanwhile, natural gas prices that have dropped 37 percent in the past year made that fuel more attractive than coal for electricity generation. In July, gas eclipsed coal as the primary fuel for power for the second time in U.S. records.”

“The best-case scenario for coal in 2016 is that demand is flat or even slightly higher, while the worst case is for it to slip another 2-4 percent, according to Levin.”

Is the U.S. at Full Employment Yet?

Wall Street Journal: “The U.S. economy is at last on the cusp of full employment after years of sluggish recovery and widespread joblessness, according to economists in a Wall Street Journal survey.”

“The U.S. will be in a state of full employment within the first half of 2016, according to a 56% of the economists surveyed … Typically, when the economy reaches full employment, wage growth follows. But economists caution that may not happen quickly.”

“Even as the unemployment rate has fallen in recent years, other signs of weakness have lingered. In particular, the share of Americans participating in the workforce declined. That rate declined in September to 62.4%, the lowest share since 1977, a period when women were far less likely to work.”

“Despite full-employment nearly in grasp, economists say the future remains far from rosy. They lowered their average forecasts for growth of gross domestic product in this year’s third and fourth quarters. And around three-quarters say the economy is more likely to do worse than their forecast than better; a majority highlighted the risk to the U.S. economy from a global economic slowdown.”

“But if those risks are avoided, they see the economy adding between 180,000 and 190,000 jobs a month next year, with the unemployment rate dropping to 4.7%. Only five of the past 40 years have seen the unemployment rate so low.”