"Reasonable" Fairy Tales

By Big Tent Democrat, Section Other Politics
Posted on Sun Jan 10, 2010 at 09:46:48 AM EST
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First, Ezra Klein's fairy tales:

The subsidy scheme: This one's really a no-brainer. The House's legislation makes insurance more affordable than the Senate's does. And really, that's what this process is all about. The House would expand Medicaid coverage to households with incomes of up to 150 percent of the poverty level, rather than the 133 percent proposed by the Senate. And between 150 percent and 300 percent of the poverty level, the House's subsidies are stronger, helping people buy better insurance, at a lower cost, with less out-of-pocket risk, than the Senate bill. For decades, Democrats have worked to ease the plight for folks who can't afford insurance. To come this far only to choose the less generous subsidy scheme would be like building a grand house only to decide to save a few bucks by not putting locks on the doors.

(Emphasis supplied.) Yet that is exactly what is going to happen. The price tag for the bill is set at less than 900 billion. It ain't changing. So what then Ezra? More . . .

Next, Paul Krugman:

[T]here’s the argument that many “Cadillac” plans aren’t really luxurious — they reflect genuinely high costs. That’s surely true. A flat dollar limit to tax deductibility has real problems. At the very least, the limit should reflect the same factors insurers will be allowed to take into account in setting premiums: age and region.

Good luck with that Paul. Krugman continues:

[T]his hurts unions which have traded off lower wages for better benefits. This would be a bigger issue than I think it is if the excise tax were going to kick in instantly. But it won’t, giving time to renegotiate those bargains. And bear in mind that this kind of renegotiation is exactly what the tax is supposed to accomplish.

Perhaps they can renegotiate for ponies as well. The problem with the wonks' approach is that it is completely divorced from reality. All for a science experiment. Krugman writes:

[W]e really don’t know what it will take to rein in health costs, but that’s a reason to try every plausible idea that experts have proposed. Limiting tax deductibility is definitely one of those ideas. Bottom line: the details of the excise tax should be fixed, but it’s on balance a good idea.

(Emphasis supplied.) That sounds like a nice science experiment. But it won't be "fixed" and a lot of people who have suffered through 30 years of stagnant wages are going to be hurt.

And if anyone cares, the fortunes of the Democratic Party are also going to be hurt.

The health care debate has been a debacle since Max Baucus hijacked the process last summer. In no small measure due to the inanities of wonks like Klein and Krugman. In the real world, the good this bill will do is offset by the harm.

The political and policy malpractice has been astonishing.

Speaking for me only

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"Reasonable" Fairy Tales | 107 comments (107 topical)

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God I'm glad I'm not the only one (5.00 / 3) (#1)
by Militarytracy on Sun Jan 10, 2010 at 09:57:37 AM EST

finding Krugman's comment divorced from reality. I was pretty floored with his comment about the unions having to renegotiate and that's simple simon nothing to be concerned about, as if in this economic climate the unions will walk in the door and say what they will have and magically be granted that. There is NO guarantee here that the unions will be able to negotiate jack chit. I wonder too if Paul Krugman ever had a union working parent as I did? Because my father became so involved and negotiating and strikes were work to him same as his job was I feel like I had more to hang onto during those stressful times. I remember too well though visiting other workers, and people sitting around the kitchen table frustrated and scared that the paychecks weren't coming in and everyone was fighting getting shafted. Those are scary times for little kids then too. So Krugman now willfully cashes in all the insane pressures that the Senate bill will apply to people already facing EXTREMELY hard times and comes away with ZERO lost for the little people? I think he's distracted lately or something, because his conscience of a liberal is bit on the dead side.

Actually (5.00 / 2) (#7)
by Steve M on Sun Jan 10, 2010 at 10:16:44 AM EST

it is the employer who will have to renegotiate, not the union, because those benefits are written into the contract. It would be a pretty weak contract if it gave the employer carte blanche to just pass along costs to the workers.

Look at it this way: the entire reason we have unions in the first place is because we believe they can get a better deal for the workers by bargaining collectively than the individual workers could get on their own. If it's true that the unions have no bargaining power and can't get anything in return for the diminution in health care benefits, then the workers are paying all those union dues for nothing.

Personally I agree with BTD's more measured critique that says the workers will get something in exchange for the lost health coverage, it just won't be at a 1:1 ratio. That's fair enough.

I do look forward to reading lots and lots of thoughtful comments now about how Krugman isn't a real progressive because he supports this idea. I wonder if those comments will be as insightful as the slew of ad hominem attacks on Ezra every time he writes something we disagree with. Because, you know, he's young, so he must not understand anything.


I'm pretty sure (5.00 / 2) (#9)
by Big Tent Democrat on Sun Jan 10, 2010 at 10:20:09 AM EST

I impugned no one's motives in the writing of this post.

Bow, their connection with reality? I do doubt it in strong terms.


I try to be clear (none / 0) (#13)
by Steve M on Sun Jan 10, 2010 at 10:25:09 AM EST

when I say comments I mean comments. Your critiques on this issue have been reality-based even though we disagree on the bottom line.

Proving my point, we already have a comment announcing that Krugman must be wrong because he's had an oh-so-privileged life.

What interests me is that you can make all these thoughtful observations about concepts like inequality of bargaining power, market failures, and so forth, and then you go around declaring yourself an unrepentant free trader. It's as though your willingness to question economic models has an off switch.


I think the critiques of free trade (5.00 / 1) (#19)
by Big Tent Democrat on Sun Jan 10, 2010 at 10:32:09 AM EST

including Krugman's supposed rethinking, are off base and unsupported by the evidence.

In particular, the attacks on NAFTA are just downright goofy. What country grew its exports the fastest since NAFTA? China.

NAFTA had no effect on that. the issue with China is not free trade - it is China's refusal to allow the yuan to appreciate to appropriate levels.


: I don't even read the NAFTA crap (none / 0) (#20)
by Militarytracy on Sun Jan 10, 2010 at 10:33:17 AM EST

Once someone goes to NAFTA I find no reason to go on.

It is only reality though (none / 0) (#18)
by Militarytracy on Sun Jan 10, 2010 at 10:32:01 AM EST

that when you have led a priveledged life you can't really empathize long term with those who haven't. Sorry Steve but that is a psychological reality. Perhaps it is okay to point that out to a credible economist. It could help him keep that credibility among the masses if he cares to.


A pure ad hominem (5.00 / 1) (#27)
by Steve M on Sun Jan 10, 2010 at 11:04:05 AM EST

Krugman is a great progressive, but suddenly when he disagrees on something, it must be that his privileged background prevents him from empathizing.

It couldn't be that Krugman is right and we are wrong, or even that we have a good-faith disagreement on what conclusions to draw from the same set of evidence. No, it must be some personal failure of character.

The ad hominem is not just a logical fallacy, it's an avoidance tactic that saves us from having to engage with the substance of an argument. I think it wouldn't kill us to give Paul Krugman a little more thoughtful consideration than we might give to, say, Dick Cheney.


What set of evidence? (5.00 / 3) (#33)
by Big Tent Democrat on Sun Jan 10, 2010 at 11:11:44 AM EST

I agree with you on the ad hominem attacks on Krugman.

That said, his arguments make little sense.

Most damning, he accepts that there is no "evidence" that supports his thesis. There is good reason for that. this has never been tried.

The problem is the lab rats for this experiment are middle class workers.


What's behind Krugman et al (5.00 / 2) (#67)
by BackFromOhio on Sun Jan 10, 2010 at 03:35:11 PM EST

I think they are all stretching to find anything they can cast as positive about the Senate bill or future prospects for fixing the worst sections once it is already past. Rather disheartening....


: We have traveled so far from the center (none / 0) (#71)
by Militarytracy on Sun Jan 10, 2010 at 03:52:58 PM EST

of reality though trying to find a scrap of something to celebrate. It is time to remember what the actual goal is and notice how we have done a whole of nothing to actually accomplish it if the Senate bill is what we get.

I disagree (none / 0) (#31)
by Militarytracy on Sun Jan 10, 2010 at 11:07:58 AM EST

Constantly finding it okay (5.00 / 1) (#35)
by Militarytracy on Sun Jan 10, 2010 at 11:12:17 AM EST

to place extreme stresses on the middle class while excluding others in this extremely stressful time is in my opinion attributable to not being able to relate to that reality.


: I think Krugman is wrong on this issue ... (none / 0) (#95)
by FreakyBeaky on Mon Jan 11, 2010 at 12:35:49 AM EST

but, with respect MT, that's about the last accusation you could plausibly throw at him.

Ability trumps empathy (none / 0) (#50)
by Manuel on Sun Jan 10, 2010 at 01:28:58 PM EST

Of course it is desirable for people to have empathy but it only matters to the extent it allows you to see effective solutions that others might miss. In this case I don't see how Krugman's background is related to his conclusion. Keynes did not exactly empathize with the proletariat and yet his ideas are considered liberal/progressive.


I would say that in good times (5.00 / 1) (#65)
by Militarytracy on Sun Jan 10, 2010 at 03:14:58 PM EST

or times of largess, ability can trump empathy. In socially trying times or bad times only those who are truly able to employ empathy first and foremost within the equations of their solutions are actually "able" or have the "abilities" that the situation requires. Absurd to attempt to throw this one size fits all baloney at me.


What about Keynes? (none / 0) (#91)
by Manuel on Sun Jan 10, 2010 at 07:27:39 PM EST

Those were truly trying times.


What about Keynes? (none / 0) (#101)
by Militarytracy on Mon Jan 11, 2010 at 09:51:31 AM EST

: Well, there is this from Wikipedia (none / 0) (#103)
by Manuel on Mon Jan 11, 2010 at 03:04:57 PM EST

Support for eugenics
Keynes was a proponent of eugenics, having served as Director of the British Eugenics Society from 1937 to 1944. As late as 1946 Keynes was still describing eugenics as `the most important and significant branch of sociology'
I am only citing this as one example (among many) of a possible lack of empathy on his part. At one time, Keynes was attacked from the left. Today he is attacked from the right. People are complex. To presume a connection between Krugman's alleged lack of empathy (without any evidence btw) and his policy prescription isn't warranted.

One's background (none / 0) (#74)
by christinep on Sun Jan 10, 2010 at 03:58:04 PM EST

While I generally agree that it is a big challenge for the privilege to understand the other-side-of-the-tracks. I've been in the situation you described above--my dad laid off in the later '50s when my sister & I were little kids and our mother had died. I remember at different times my dad asking his under-10 year old daughter what to do and worried about paying the rent. And, we were very lucky; we all came through it. And more (because of the sheer stick-to-it-iveness of my dad and some good fortune.) I understand the need for unions and support them wholeheartedly. To put it bluntly, my gut reaction to the Geithners of the world, e.g., generally causes at least a burp. Yet...I don't take my assumption that surmounting poverty always gives one empathy (see, for example, Dick Nixon); nor do I consider it impossible to have a feel for the anguish of struggle when the loss of a job also undermines dignity (see, e.g., FDR, RFK.) Insofar as Krugman is concerned, I have great respect for his commentary. In so many cases, he has been in the lead--recall last spring when he argued for a stronger stimulus to put more $ into the economy as a jumpstart and to create jobs faster. In the case of the excise tax, my instinct is to see it through a bit because from a structural standpoint the pressures for the employer (in future bargaining)to raise wages and bargain off the higher costing "cadillac" plans may actually play out as Krugman conjectures. My point: A little benfit of the doubt for Paul Krugman in consideration of his liberal record and his often accurate analysis.


Correction to my first sentence above (none / 0) (#77)
by christinep on Sun Jan 10, 2010 at 04:06:42 PM EST

It should read: "While I generally agree that it is a big challenge for the privileged to understand the other-side-of-the-tracks, that is not always the case." (The emotional memory leading to my comment stemmed from recalling my fears as a child when dad is not working.)


: Another point, though: Straddling tracks (5.00 / 1) (#79)
by Cream City on Sun Jan 10, 2010 at 04:23:38 PM EST

can just get you run over.

I'll try (none / 0) (#80)
by Militarytracy on Sun Jan 10, 2010 at 04:31:00 PM EST

but since he wrote about not even arguing any longer for the real solutions because those won't be even looked at.....it has been nothing but drivel. I think he has made a seriously flawed decision in no longer arguing the actual real solutions. How can you not argue the real solutions without your argument being in the end just a sellout?


"How can you" (none / 0) (#89)
by christinep on Sun Jan 10, 2010 at 06:42:48 PM EST

Good question, MT. Yet, I do know that people often see "real" differently--not because they are bad or indifferent. My husband of 40+ years have been differing/arguing/discussing and still together even tho we look at issues like these very differently. He (the husband) had a very secure childhood in an economic sense; my security, meanwhile, was in the emotional and belonging sense. Well...I get angry a lot about economic disparity and the ole' boys clubs, etc. But, even now (especially now), I find that there are some that have earned a certain level of trust. As to Krugman: He took on a lot of those that be when he first argued economically & morally against Iraq. That took courage. There are other examples of his straightforwardness. Perhaps, he is wrong; but, I'm willing to stay with awhile longer without concluding that he has either sold out or forgotten his principles.


I understand his past courage (5.00 / 1) (#92)
by Militarytracy on Sun Jan 10, 2010 at 07:45:23 PM EST

In his own words in his own typed hand he announced he would no longer argue for the real solutions because those will not be entertained. And his writings after that ceased to make any sense to many of us. These are not moments of Krugman courage, and a past courage will not make today's lack of courage more courageous.


But which Krugman do you believe? (5.00 / 2) (#94)
by Cream City on Sun Jan 10, 2010 at 09:50:25 PM EST

The Krugman who, since he was invited into Teh Presence in Teh White House that we are stoopid libruls to still want the public option -- or the Krugman who wrote this only four months ago, in September:

Why the Public Option Matters

Most arguments against the public option are based either on deliberate misrepresentation of what that option would mean, or on remarkably thorough misunderstanding of the concept, which persists to a frustrating degree: I was really surprised to see Joe Klein worrying about the creation of a system in which doctors work directly for the government, British-style, when that has nothing whatsoever to do with the public option as proposed. (Forty years of Medicare haven't turned the US into that kind of system -- why would having a public plan change that?)

But what is one to make of the practical, political argument from the likes of Ezra Klein, who argue that any public plan actually included in legislation probably wouldn't make that much difference, and that reform is worth having even without such a plan?

There are three reasons to be suspicious of that argument.

The first is that I suspect that Ezra and others understate the extent to which even a public plan with limited bargaining power will help hold down overall costs. Private insurers do pay providers more than Medicare does -- but that's only part of the reason Medicare has lower costs. There's also the huge overhead of the private insurers, much of which involves marketing and attempts to cherry-pick clients -- and even with community rating, some of that will still go on. A public plan would probably be able to attract clients with much less of that.

Second, a public plan would probably provide the only real competition in many markets.

Third -- and this is where I am getting a very bad feeling about the idea of throwing in the towel on the public option -- is the politics. Remember, to make reform work we have to have an individual mandate. And everything I see says that there will be a major backlash against the idea of forcing people to buy insurance from the existing companies. That backlash was part of what got Obama the nomination! Having the public option offers a defense against that backlash.

What worries me is not so much that the backlash would stop reform from passing, as that it would store up trouble for the not-too-distant future. Imagine that reform passes, but that premiums shoot up (or even keep rising at the rates of the past decade.) Then you could all too easily have many people blaming Obama et al for forcing them into this increasingly unaffordable system. A trigger might fix this -- but the funny thing about such triggers is that they almost never get pulled.

Let me add a sort of larger point: aside from the essentially circular political arguments -- centrist Democrats insisting that the public option must be dropped to get the votes of centrist Democrats -- the argument against the public option boils down to the fact that it's bad because it is, horrors, a government program. And sooner or later Democrats have to take a stand against Reaganism -- against the presumption that if the government does it, it's bad.


: You get to a negotiation point when... (none / 0) (#102)
by christinep on Mon Jan 11, 2010 at 01:18:00 PM EST

you either remain with your initial position or try to have an impact on the evolved position. My experiences with negotiation is that some remain with the initial position only until they walk in the door (indeed, some don't even know what their position is or should be), others spar in the initial give & take, some stay a bit longer, others go for the compromises they can get and gradually move to the new/evolved position <where the one holding the final say stands pat>, and the remainder remain. I think that these approaches often reflect personality styles, at the very least. And, I think Paul Krugman looks very much like the proponent who will--after pushing hard and loud and clear-- adapt to the obvious direction of the general political program that he favors. From time to time, I've mentioned Saul Alinsky and the philosophy of political movement--including how individuals come to a realization of when to, how to, or whether to settle. That context (together with my own personality/style)is why I have little issue with how Krugman has moved in this debate.

Krugmans never suffered a day in his life (none / 0) (#4)
by SOS on Sun Jan 10, 2010 at 10:10:29 AM EST

Privileged from day one.


: So on a good day he can feel (5.00 / 1) (#5)
by Militarytracy on Sun Jan 10, 2010 at 10:13:21 AM EST

sympathy for me and on a bad day or a busy day he can feel nothing? He can't empathize on a daily basis with what he has never known, I get it now.

Yes, after 30 years weakening the bargaining (5.00 / 3) (#2)
by ruffian on Sun Jan 10, 2010 at 10:06:02 AM EST

power of unions, our leaders and commentariat are sure the unions can waltz right in there and negotiate for higher pay raises. It is more likely that this will weaken unions even more - must be hard to convince workers to unionize when a hard-fought collective bargaining agreement can be undermined so easily.

Would Krugman be so sanguine if the government began to tax professorial tenure as a benefit?

: I'm a member of an AFT bargaining unit (5.00 / 4) (#41)
by kempis on Sun Jan 10, 2010 at 11:46:32 AM EST

at a community college.
I've taught there for over 20 years, and for the past decade we have worried every single time that the contract was eligible for renegotiation (usually five years) that we would lose our very good health care benefits. Creative bargaining has preserved them, providing us with a menu of choice from PPOs to HMOs, depending on how much we wish to pay. I don't know for certain, but given our collective age and region and quality of insurance, I would bet that our top tier choice will be eliminated as a result of the excise tax. And the savings to the college will not be expressed in an increase in wages beyond the usual percentage.
Perhaps it's different in the private sector, but I doubt it based on what I have seen of negotiations and the relationship between management and union. Adding shareholders to the mix would, I would think, add an incentive for maximizing profits rather than plowing savings back into the labor force. But maybe I'm wrong. Maybe private sector management says to the workers, "Hey guys! We saved this bundle of money! How would you like your share?"
In lean times, a bargaining unit does not have a lot of clout. The management can show the business is in dire financial straights and call for concessions. This happens quite a lot. Lately, it has happened more than ever. Some unions recently have negotiated not to gain more benefits and pay but to limit cuts in them. It's hard to imagine that scenario changing in a severe recession.
I like Krugman, but I keep saying that he's looking at the larger picture--getting the big numbers moving in the right direction--so much that he's losing sight of the likely costs to individuals who will be making the sacrifices to get those numbers moving in the direction they need to go. Those individuals are not in the insurance industry. And they won't be in the upper echelons of corporations and businesses and institutions....I keep saying that Krugman can't see the trees for the forest.
And a bunch of unhappy trees spell trouble for the Democrats this year and in 2012.

: I get better coverage through my Pro Guild ... (5.00 / 2) (#63)
by Ellie on Sun Jan 10, 2010 at 03:05:17 PM EST

... which forces new clients/employers to adhere to the existing standard and even supplement an upgrade at signing (I can be on retainer and sign a longer term one depending on the project.)
As a potential boss of my own shop, this Ponies in the Future, We Promise deal -- especially dialing back care & coverage for women -- leaves me multiply vulnerable not just for myself, but on the hook for workers too.
If I were negotiating this, I'd walk away from the table and tell them to call back when they're serious.

I've given up on Krugman (5.00 / 1) (#3)
by SOS on Sun Jan 10, 2010 at 10:06:56 AM EST

He is to wealthy, and has totally and completely lost track of reality. Ask 40 Million people who can't barely keep the lights on, and all the rest who's home ATM machines have suddenly stopped paying cash on demand.

I'd also like to toss Erza out into the snow and arctic cold right now to see whats it like when you've been abandoned totally by this system and not freezing to death is your only concern at the moment.

Well (5.00 / 2) (#6)
by Ga6thDem on Sun Jan 10, 2010 at 10:14:43 AM EST

I've been in favor of killing this bill for quite a while now and every day there's more evidence that it's quite horrible.

Honestly, I don't think the GOP could have picked a better person to destroy the Dem party themselves than Obama. There won't be much of a party left after Obama is done. Maybe the party will come back, maybe it's done forever at this point. We'll just have to wait and see.

I don't think any party is done forever (5.00 / 2) (#12)
by Militarytracy on Sun Jan 10, 2010 at 10:25:01 AM EST

at this point in our political reality. It can have a revelation moment though when they return to the party platform. Those old platforms became what they were and survived because they represented all sides of the human condition. The Republican party has been granted such a moment and they went straight to Jesus again :) It's strange watching both parties implode in the eyes of the people. And why is this happening? Because both parties are bought and paid for by the lobby and we all know this now. The only thing left to us is to play one sell out against the other and have a good time making them all sweat and miserable I guess, because the words coming out of their mouth don't mean chit anymore, not even a little bit! I vote when they are polling us from now on, switch your answer to the polar opposite of the one you gave last time. If I can't beat em I can at least have fun making them NUTS!


I've voted Democratic based on "hope" (5.00 / 9) (#17)
by esmense on Sun Jan 10, 2010 at 10:29:28 AM EST

for almost 40 years. Ironic that it's Mr. Hope himself that has finally convinced me that there is none.


: I was taught (none / 0) (#78)
by christinep on Sun Jan 10, 2010 at 04:20:47 PM EST

and still believe, that hope must always be in the forefront. Tho, I was also taught that voting is a very practical experience where the candidate's record and experience must be in the forefront as well.

Obama is a symptom, not the cause (5.00 / 3) (#48)
by Spamlet on Sun Jan 10, 2010 at 12:12:24 PM EST

: RHPS (5.00 / 2) (#49)
by jedimom on Sun Jan 10, 2010 at 01:21:18 PM EST

Having a RHPS flashback now, needed that smile, tx!
"what about the symptom?"

I love (sarcasm) Kleins defense of the excise tax: (5.00 / 2) (#8)
by esmense on Sun Jan 10, 2010 at 10:20:08 AM EST

"Most economists think this one of the most promising cost-control ideas in the bill. It's also one of the riskiest: If the legislation doesn't control costs, the tax will begin to hit more and more plans as time goes on. But cost control is going to be hard to do. At some point, we have to muster the courage to try."

How much confidence do you have in what "most economists think?"

It's a science experiment (5.00 / 6) (#10)
by Big Tent Democrat on Sun Jan 10, 2010 at 10:21:05 AM EST

with middle class workers as the lab rats.

It is NOT a progressive approach.


An experiment without "informed consent" (5.00 / 5) (#28)
by lambert on Sun Jan 10, 2010 at 11:06:38 AM EST

Which is a horrible violation of medical ethics. This matters to the peasants, at least, since to them this is about health care, and not about extracting big sacks of money from the bodies of the sick.


And when you attack the peasants (5.00 / 2) (#38)
by Militarytracy on Sun Jan 10, 2010 at 11:39:19 AM EST

They will attack back. In all of this the peasants are being attacked and nobody feels any shame about that.


: And that the middle class is the peasantry (5.00 / 3) (#40)
by Cream City on Sun Jan 10, 2010 at 11:43:09 AM EST

is the realization that is dawning upon the middle class now, I think. The reverse of the American Revolution. So that may give rise to a new one.

Very well said!!!!! (none / 0) (#23)
by Militarytracy on Sun Jan 10, 2010 at 10:45:49 AM EST

And unfortunately nobody worries about the lab rats as they "figure" this experiment out. It's the craziest crap I've ever seen.


We have to muster the courage to "try" (5.00 / 1) (#16)
by Militarytracy on Sun Jan 10, 2010 at 10:28:51 AM EST

You don't need any effing courage to "try". I hate the word "try" when the chips are down. We aren't taking ballroom dance Ezra! I despise it because it has failure built right into it. I used to ask our teenager what her goal was in a certain area and she would always tell me she was going to "try" this or that. I would then tell her that she had no real goal because "try" does not lend itself to direct action to attain the goal. I wish Ezra would "try" harder to be a decent liberal pundit....someone credible and in touch. Keep trying Ezra!


I wonder if he knows where his plan (none / 0) (#11)
by nycstray on Sun Jan 10, 2010 at 10:23:22 AM EST

stands with the tax . . .


Erza . . As a life long dedicated pacifist (none / 0) (#14)
by SOS on Sun Jan 10, 2010 at 10:26:27 AM EST

things have gotten to the point in this country economically and culturally to where I have to fight off the urge to want strangle this little punk.

It's very difficult . . I can't imagine whats going to happen with all the people out there who have little if next to no self control and will power when they snap.

Tensions are very very high


: People who aren't unemployed (none / 0) (#42)
by Militarytracy on Sun Jan 10, 2010 at 11:47:25 AM EST

right now don't understand the stresses I guess. I was shocked yesterday when my daughter's biological father who is in his early forties said that he wished he was in the military right now like my husband is.

Klein gives it all the way here (none / 0) (#52)
by esmense on Sun Jan 10, 2010 at 01:47:43 PM EST

He is conceding, without admitting that he is conceding it, that it is inflation in premium cost, not consumer choice, that is most likely to move people into the "cadillac" cost range.

When my husband and I chose our high deductible and high co-pay insurance plan (no dental, vision, mental health, etc.) in 1996 it was the most cost effective option available to us. For the last several years it has been the only option available to us -- at a monthly premium 5 times higher than what we paid in '96.

If the assumption the excise tax is based on -- that consumers are purchasing "too much" insurance leading to over utilization -- isn't true, how true can the assumed savings be?

Can't people like Klein see their own illogic? It makes me crazy to read arguments like this.


: I meant to say "Klein gives it all away" (none / 0) (#53)
by esmense on Sun Jan 10, 2010 at 01:51:03 PM EST

Head Banging (5.00 / 3) (#15)
by Pat Johnson on Sun Jan 10, 2010 at 10:27:06 AM EST

Wonder if I will be covered for the pre existing condition of the scars left from banging my head against a wall for the past 10 years?

None of these trolls in DC give a care about the rest of us and attempting to find a "silver lining" in all this b.s. is futile.

There is not one in congress about whom I even remotely trust to do the right thing. This statement does not elevate my sense of well being.

Krugman vs Krugman on the McCain/Obama tax (5.00 / 3) (#21)
by Dan the Man on Sun Jan 10, 2010 at 10:39:27 AM EST

even though the McCain tax was more liberal than the Obama one.

Krugman once opposed changing the tax break.

"Mr. McCain, on the other hand, wants to blow up the current system, by eliminating the tax break for employer-provided insurance."

Now, one could point out the Obama tax doesn't really eliminate the tax break - it just places limits on it. But then, as even Krugman points out, McCain just wanted to replace the tax break with a credit of "$2,500 for an individual, $5,000 for a family".

So how would middle class families fair on both plans? Let's say the family is in the 25% bracket like many such families and use the example Krugman uses - the premiums cost $12,000 a year. For the Obama tax plan, they would pay 0 taxes because their premiums are under the Cadillac plan limit. For the McCain tax plan, they would pay $3000 in tax (on the $12000), but get back $5000 (on the credit). So, in total, the McCain plan gives back the family $2000 ($5000 - $3000). Furthermore the McCain plan makes families in higher tax brackets pay more. So in reality the McCain health insurance tax plan is more liberal than the Obama one, but Krugman supports the Obama tax while he was against the McCain tax. Can somebody give us back the Conscience of a Liberal?

Baucus not all to blame (5.00 / 7) (#22)
by jbindc on Sun Jan 10, 2010 at 10:41:45 AM EST

Don't think he did anything without the express consent of the WH. The administration's fingerprints are all over the Senate bill.

And come SOTU, all we will hear is a triumphant call about this is the best piece of legislation in a generation. Instead of Greek columns, I expect Obama to be carried in on a lectica while Pelosi feeds him grapes.

This is another reason that I'll pass on the SOTU (5.00 / 3) (#44)
by kempis on Sun Jan 10, 2010 at 11:58:28 AM EST

I've watched every one since my twenties, but I honestly don't think I can bear to hear the b.s. this time. Watching Bush's were kind of fun just to see Teddy Kennedy shaking his head in disgust, but when you're shaking your head at the guy who is supposed to be on your side, that's too painful.

The health care debacle has sealed it for me: this administration is primarily interested in kissing up to the sources of wealth and power in this country. The rationale, of course, is this is how things work. It takes millions to win office in this country, so those with the most money to give matter more. The status quo must not only be preserved but burnished.

I guess it's a "creative class" thing.


: I'm passing too (5.00 / 3) (#47)
by Militarytracy on Sun Jan 10, 2010 at 12:08:58 PM EST

He has nothing to say that I even believe at this point. I really don't want to sit there and listen to anything that next year I'm going to have to grieve my lost innocence to anymore. He's a lying loser until he proves to me that he isn't. I was just about finished when he pulled that "I didn't campaign on the public option" $hit. Now that I'm getting the excise tax shoved down my throat, I'm fricken done. He's just going to talk jobs now, but Geithner and Summers don't want serious jobs programs and there are now economists predicting that a new strong job market will lead to a Wall Street dip. Do I really want to sit there tonight and listen about all the great jobs that are never going to happen? NOPE!

You and I can speculate all day about (none / 0) (#24)
by Militarytracy on Sun Jan 10, 2010 at 10:48:57 AM EST

that. And we can give instances and examples of how this happened and how it could not have happened, and the apologists are going to call you and I fruitcakes and firebaggers all day long. We need evidence. They have paper shredders.


: But you and I (5.00 / 2) (#54)
by jbindc on Sun Jan 10, 2010 at 01:51:23 PM EST

And anyone who has been remotely paying attention and has an IQ over 35 and didn't drink the kool-aid knows this.
Funny how we kept hearing how "Obama" tightly managed his campaign (but we know we wasn't really in charge), and how strict Rahm is, but now the WH argument is going to be "Hey, it's Congress that come up with these ideas all by themselves. There was absolutely nothing we could do - they might hurt us."

Baucus didn't "hijack" the process (5.00 / 1) (#25)
by lambert on Sun Jan 10, 2010 at 10:59:03 AM EST

He was handed the process by Obama.

: I think you're right (5.00 / 1) (#46)
by kempis on Sun Jan 10, 2010 at 12:08:04 PM EST

After all, Olympia Snowe's finally-won endorsement was tepid and conditional. It seemed to me that she was the excuse for watering down reform to an even more industry-friendly consistency. In the service of the noble, Village-honored goal of bipartisanship, Obama and Baucus conceded more and more. (Of course, many of the concessions were already made back in June, if not earlier.) It was theatre: we watered this down to appeal to a Republican. Of course, the Republican withdrew support in the end, but Obama and the Dems have gambled that it is more important to their success for them to please the health care industries than ordinary folk.
It will be interesting to see if they are right.

"A science experiment" is a great line (5.00 / 2) (#26)
by Cream City on Sun Jan 10, 2010 at 10:59:22 AM EST

(although I might amend it to "a social science experiment" for a bit more clarity, but such a minor point). Keep using it. I plan to do so.

And that Krugman cannot see how experimental is this effort, with so many theories untested and unsupported, with so many questions unanswered, is just sad. I had respected him. But then, that is true of so many now.

Again, without "informed consent" (5.00 / 6) (#30)
by lambert on Sun Jan 10, 2010 at 11:07:46 AM EST

This plan isn't being marketed as an experiment, even though that's what it is, and has been since the beginning.


On the one hand (5.00 / 1) (#56)
by Steve M on Sun Jan 10, 2010 at 02:01:21 PM EST

it is this massive untested experiment, and on the other hand, all you guys know precisely what will happen (no increase in wages, huge burden on the middle class, death of the Democratic Party, yadda yadda). So I think either you don't really believe it's an experiment or else you are overstating the certainty of your conclusions.


logically predicting outcomes... (5.00 / 2) (#60)
by Dadler on Sun Jan 10, 2010 at 02:24:06 PM EST

...is what is being done. Tell me the last time you were logically convinced of something but decided to just go ahead and do believe something else instead, and then act on that "belief"? Those hoping this will working are doing just that...hoping. They offer nothing LOGICAL to strongly support their point. And, for heaven's sake, the entire reason this excise tax is being foisted on us by the House of Lords is so the wealthy don't have to pay a little more for the benefit of all. That's the real bottom line. Rather than tax those who will suffer the least from it, we choose to concoct a dubious scheme that could only be the product of a baldly corporate government, not only bought and paid for, but stuffed and mounted as well.

But this is just my opinion. You have yours, and I'm sure you are just as certain of it, even if you are only certain of uncertainty.

Ahem.


I can't even comprehend (none / 0) (#85)
by Steve M on Sun Jan 10, 2010 at 05:15:26 PM EST

"I am sure you are just as certain, even if you are only certain of uncertainty." Doublespeak.

There is, of course, a perfectly logical argument in favor of the excise tax, whether you agree with that argument or not, and the tax is far more than just a funding mechanism. Denying that the opposing argument exists doesn't make it so.


: Logical but not empirical (none / 0) (#97)
by hookfan on Mon Jan 11, 2010 at 03:53:34 AM EST

until somebody sorts out the factors that lead to valid predictions. What are the factors that in the past have led to increased wages through bargaining, for example? What are the conditions and factors that have led to ineffective bargaining? If we would look honestly at union contractual disputes during past recessions, and compare the actual outcome results on wage increases we might get some valid predictive basis. I don't know who has done that, or how that can be effectively sorted from other aspects of benefits packages. What I do know is that wage growth has been sacrificed in past recessions in order to preserve other benefits (like preventing layoffs, maintaining health insurance, etc.), I know of no situation where insurance benefits have been sacrificed by fiat going in, nor what effect that will have on wage negotiation in a context of 10% plus unemployment. I would predict, tho, based on my union experience during the Reagan years, that management will be in the catbird seat, and that wages will be limited either to no growth ("be thankful you have a job, there's plenty of skilled replacements"), or at best growth that is less than expected.
What I would be interested in is the question of "What then?". If the situation really will be less health insurance benefits, little growth in wages, and continued double digit increases in premium costs, what then?

Great debater's point, steve! (none / 0) (#58)
by lambert on Sun Jan 10, 2010 at 02:08:37 PM EST

Impressive. However, we really do know what works. Systems from single payer leftward to socialized medicine deliver better health care outcomes for half the cost. However, our elites won't deliver on that, because that would mean they wouldn't be able to skim as much money.


: Sure (none / 0) (#59)
by Steve M on Sun Jan 10, 2010 at 02:12:16 PM EST

when you're interested in discussing the topic at hand, rather than retreating to the unassailable point of "single payer would be better!" I'll be interested in your response.
The success of single-payer tells us nothing about what the economic impact of an excise tax will be, but it sure does seem to be your favorite "debater's point." Hey, I'd like a pony as well.

What Dadler said. Again, we know (none / 0) (#61)
by Cream City on Sun Jan 10, 2010 at 02:58:52 PM EST

that experience isn't supposed to matter anymore, but can you at least contain that to the presidency and allow us to learn from our own experience?

You rely on theory. We rely on history, on patterns of human behaviors based on human nature for long before your theorists were born. Of course, this economic depression in some ways is not following some previous patterns, to the chagrin of some of us supporting our unemployed family members who ought to have been back to work by now, based on your theorists. But again, the patterns may have their minor differences, but the human behaviors and human nature of those in power has not changed, no matter how much we hope so.


Good point, Steve M (none / 0) (#81)
by christinep on Sun Jan 10, 2010 at 04:32:20 PM EST

For some goofy reason (and I'm not being sarcastic)the "experiment of democracy" keeps running through my mind. There are "experiments" that are good. The preamble to the Constitution does set out a great experiment. Actually, any major change in the course of a national approach or personal approach could be called an "experiment." Obviously, not necessarily bad?


And it's the informed consent... (none / 0) (#104)
by lambert on Mon Jan 11, 2010 at 07:05:50 PM EST

... that makes the difference, eh?


: Sometimes, not always (none / 0) (#107)
by christinep on Tue Jan 12, 2010 at 05:37:23 PM EST

And without any appropriate (5.00 / 2) (#69)
by BackFromOhio on Sun Jan 10, 2010 at 03:44:26 PM EST

controls on internal or external validity


Buwahahahahahaha! (5.00 / 2) (#29)
by Militarytracy on Sun Jan 10, 2010 at 11:07:07 AM EST

Now that Gruber realizes that his butt is in the hotseat and that FAILURES could go down with his name emblazoned on them....he has delivered caveats now too everyone. Per emptywheel, who is not to be believed for more reasons than I can share here :)

Noted that "many" academic studies (though he doesn't say it, some of them are Gruber's own studies) show that "when health costs rise, wages fall"
Pointed out that during the late 1990s, the slowing rise in health care costs coincided with wage increases
Admitted that "other factors could also have lifted wages during that period"

: Tell him (5.00 / 3) (#70)
by BackFromOhio on Sun Jan 10, 2010 at 03:46:05 PM EST

correlation and coincidence don't equal causation. One of the elemental rules of scientific & social science research.

Time for another West Wing quote (5.00 / 2) (#55)
by jbindc on Sun Jan 10, 2010 at 01:54:36 PM EST

And I say this as a centrist.

Bruno Giannelli, Bartlet for America campaign manager:

Because I'm tired of working for candidates who make me think that I should be embarrassed to believe what I believe, Sam! I'm tired of getting them elected! We all need some therapy, because somebody came along and said, "'Liberal' means soft on crime, soft on drugs, soft on Communism, soft on defense, and we're gonna tax you back to the Stone Age because people shouldn't have to go to work if they don't want to!" And instead of saying, "Well, excuse me, you right-wing, reactionary, xenophobic, homophobic, anti-education, anti-choice, pro-gun, Leave It To Beaver trip back to the Fifties...!", we cowered in the corner, and said, "Please. Don't. Hurt. Me." No more. I really don't care who's right, who's wrong. We're both right. We're both wrong. Let's have two parties, huh? What do you say?

I agree - it would nice to have a WH and a Democratic Party that actually fought for things, say like, health care and not a boon to the insurance industry.

Time for another West Wing series, say I (5.00 / 1) (#62)
by Cream City on Sun Jan 10, 2010 at 03:00:07 PM EST

and this time around, perhaps it would be more apropos to have Charlie Sheen playing his father's role in the presidency? :-)


But, who would play this Sheen's wife? (5.00 / 1) (#83)
by christinep on Sun Jan 10, 2010 at 04:42:36 PM EST

: Ouch! (none / 0) (#87)
by Cream City on Sun Jan 10, 2010 at 05:29:06 PM EST

: Courtney Love? (none / 0) (#98)
by jbindc on Mon Jan 11, 2010 at 07:12:46 AM EST

Half of the funding (5.00 / 2) (#82)
by KeysDan on Sun Jan 10, 2010 at 04:40:41 PM EST

in both the House and Senate bills is based on the "Willie Sutton school of revenue:"-- go where you can get the money. The House bill is more progressive with its surtax on very high earners. The Senate bill calls for greater Medicare taxes on higher earners plus the "Cadillac" excise taxes. The later aspect of the new taxes captures middle earners and attempts to sooth with specious arguments such as it being a great way to keep health care costs from rising, employers will pass premium savings on to employees, and additional income taxes will be paid on the new income. The other half of the funding in both the House and Senate bills, turns Willie's reasoning upside down-- to go where the money isn't-- Medicare. Just as the "Cadillac" excise tax is deceptively alluring and based on questionable studies so, too, is the "savings" from Medicare without any risk of diminishing benefits

: OK, now you've given me a (none / 0) (#84)
by oldpro on Sun Jan 10, 2010 at 05:08:35 PM EST

killer headache and I'm not sure my medicare and backup insurance will cover the drugs needed to cope. In fact, I'm pretty sure they won't.
Maybe I'll switch to bourbon.

What I find sad (5.00 / 1) (#100)
by lilburro on Mon Jan 11, 2010 at 08:52:31 AM EST

is that the big thing that would help slow health care costs, the public option, is already disappeared.

A last general point: we really don't know what it will take to rein in health costs, but that's a reason to try every plausible idea that experts have proposed. Limiting tax deductibility is definitely one of those ideas.

Every idea except the proven one.

I haven't seen this discussed- (none / 0) (#32)
by kaybeel on Sun Jan 10, 2010 at 11:10:45 AM EST

Don't unions already have the option to negotiate for less expensive health care plans and higher wages?
It seems to me, the way things are now is exactly the way the unions and workers wanted them to be. Less paycheck, more health insurance. That was a choice, not something that just happened.
So why does the government have to step in with the excise tax to save the unions from themselves?
Isn't the government saying here, you've chosen the wrong thing and we are going to take it away from you, but it's for your own good (plus we can tax you on it once it's in your pocket).

No, in every negotiation with unions (5.00 / 3) (#36)
by Cream City on Sun Jan 10, 2010 at 11:20:09 AM EST

that I have witnessed in my workplace and read about in others, the workers would have preferred wage hikes but had to settle for benefits hikes -- and the promise that, gosh, when management could wangle wage hikes again, they would be back. Uh huh.


well then (none / 0) (#37)
by kaybeel on Sun Jan 10, 2010 at 11:39:18 AM EST

that seems to indicate it isn't a 1:1 swap now. So I'm not sure why it would be if this bill passes.


Exactly. That's why the argument (5.00 / 5) (#39)
by Cream City on Sun Jan 10, 2010 at 11:41:33 AM EST

is nonsense that it would happen now. Bills, shmills; they cannot change human nature (and even attempts to change human behavior often fall to human nature's ability to find loopholes fast).


Another thing that is sad in all of (5.00 / 3) (#43)
by Militarytracy on Sun Jan 10, 2010 at 11:49:54 AM EST

this, if you have never experienced union negotiations and the stresses that affect all the union members when all of that is happening....you just have no idea what the hell you are talking about here. If you think you can easily predict how union negotiations are going to go, once again you just have no idea what the hell you are talking about here.


Exactly. Although even worse (5.00 / 5) (#45)
by Cream City on Sun Jan 10, 2010 at 11:59:50 AM EST

can be being in a unionized workplace but in the only group that is banned from collective bargaining, as I have been. The result is that whatever the unions get is going to frame what we get, if left over and less. And when we are banned from bargaining because we are a different group with different needs, it really can be stressful to see ourselves and our needs entirely unrepresented.

But coming from a Teamster family, descended from Molly Maguires, and having read a lot of labor history, I know what unions meant -- and what has happened to them in the conservative decades. The unions were dumb, though, to let the romanticism of long-gone Democratic party principles mislead them into thinking that supporting these Democrats today would bring back that past. So the unions did not bargain with the Dems as they ought to have done, and we see the result for the workers now -- not only the unionized workers but even worse for the rest of us who had no say in the unions' stupidity but are stuck with it, too.


: I belong (none / 0) (#88)
by kidneystones on Sun Jan 10, 2010 at 06:19:35 PM EST

to a union and went through a work action in December. The historical role unions have played improving the lives of members and non-members is a matter of fact. That said, unions are not all cut from the same cloth and many times (obviously) reflect the prejudices and personalities of the membership.
Had lunch last week with an old friend who worked for one of the big three auto-makers. I asked him about the union 'bottom-line'. His reply: 'the company will always find the money'. This attitude and 'work slower, you're making the rest of us look bad' and 'not my job' are real. They might even be right in some situations.
China is about to replace Germany as the world's leading exporter. The US and Canada have large numbers of people with next to no skills at all and fewer and fewer places to learn these skills.
One solution may be to legalize marijuana, put game consoles in every home and invite the gullible to participate fully in a virtual world. Some, I suspect, already do.
Others, hoping to provide themselves and their kids with usable skills need to take a hard look at where they're living and what they're doing.
The Okies picked up and left en masse when it became clear there would be no work for them. The same writing is on the wall know, it's just harder to see. The dust swirls and destinations are hard to make out. One thing seems clear to me, however, this administration may be less capable of providing real job growth than the last.
Community organizing at any level, whether for re-cycling or education or looking out for neighbors is a good place to start.

Present law (none / 0) (#57)
by Steve M on Sun Jan 10, 2010 at 02:05:41 PM EST

gives favorable tax treatment to health benefits, creating an incentive to negotiate for more benefits (and less wages) than there would be in the absence of a tax break.


What present law? (5.00 / 1) (#64)
by Militarytracy on Sun Jan 10, 2010 at 03:10:23 PM EST

Are you a part of Union negotiating at this time? Have you ever been?


What is your question? (none / 0) (#72)
by Steve M on Sun Jan 10, 2010 at 03:54:35 PM EST

Are you disputing that employers get a tax break for providing health insurance? I need to be in a union to understand the tax code?


Why would that translate (none / 0) (#75)
by Militarytracy on Sun Jan 10, 2010 at 03:58:12 PM EST

into a wage increase or no loss of the quality of healthcare benefit to any union worker during an economic time that can only be compared to the Great Depression Steve? Why do I have to put up with such total nonsense from someone just because they passed a certain exam at one time in their life?


: Wow (5.00 / 1) (#86)
by Steve M on Sun Jan 10, 2010 at 05:16:12 PM EST

I can't even post a factual statement about the U.S. Tax Code without this kind of nasty personal crap? You are better than this MT.

: Oh yeah, and Gruber appreciates (none / 0) (#76)
by Militarytracy on Sun Jan 10, 2010 at 04:01:03 PM EST

the 400 grand but wants you to know now that he isn't so sure about things.

You're totally forgetting (5.00 / 2) (#66)
by gyrfalcon on Sun Jan 10, 2010 at 03:34:01 PM EST

that employers get a tax break for health insurance expenses. They get no break for wages. IOW, it costs them less to provide workers $100 in hc than it does to provide them $100 in wages.


I'm sure it's been discussed (none / 0) (#34)
by kaybeel on Sun Jan 10, 2010 at 11:12:01 AM EST

btw, I just haven't seen it.


But don't we need (none / 0) (#51)
by Manuel on Sun Jan 10, 2010 at 01:44:30 PM EST

more experients

We may argue if this is the correct experiment (among many possible ones) but we can't argue that more experimentation isn't needed.

Let's see (none / 0) (#73)
by Militarytracy on Sun Jan 10, 2010 at 03:55:01 PM EST

I'm stuck with the experiments again why? Oh yeah, because any other working model the world over will not be tolerated by the lobbyists. I don't need the experiments. They are being shoved down my throat while people like you keep insisting that I must have them.


Did you click on the link? (none / 0) (#90)
by Manuel on Sun Jan 10, 2010 at 07:25:42 PM EST

That was BTD and FDR and Krugman arguing for bold experimentation. The world as it is isn't working. What we are doing is not sustainable. What do you think we should do other than experiment?


We could adopt one of the systems (5.00 / 3) (#93)
by MO Blue on Sun Jan 10, 2010 at 08:34:02 PM EST

used by countries that spend half what we do for real health care. Of course, since that would mean abandoning the industries that have screwed us over and eliminate campaign contributions to our bought and paid for Congress, that will not happen.


And since it will not happen ... (none / 0) (#96)
by FreakyBeaky on Mon Jan 11, 2010 at 12:52:06 AM EST

what then?

Sometimes you get what you can take, and other times you take what you can get. We're in the latter territory. Sucks, but there it is. In my opinion we're better off admitting it.


Sometimes doing something that may (5.00 / 1) (#99)
by MO Blue on Mon Jan 11, 2010 at 08:45:42 AM EST

well cause more harm than good is worse than doing nothing.


We're not there (none / 0) (#105)
by FreakyBeaky on Mon Jan 11, 2010 at 11:51:16 PM EST

Though plainly you disagree.


: It is your opinion that we are not there. (none / 0) (#106)
by MO Blue on Tue Jan 12, 2010 at 09:53:59 AM EST

I guess we will find out whether your opinion is correct or not once this debacle is implemented.

Given corporate rule: (none / 0) (#68)
by Lora on Sun Jan 10, 2010 at 03:35:54 PM EST

I would have been astonished if anything progressive had actually occurred.