Archive for February, 2010

P-Fix Highlights of the Week

Friday, February 26th, 2010
Elbert Ventura



Elbert Ventura is the managing editor of Democracy: A Journal of Ideas. He formerly served as the managing editor of the Progressive Policy Institute.

by Elbert Ventura

In case you missed them, here are Progressive Fix’s highlights from the past week:

  • PPI Policy Memo, “Charting a Course for a National Infrastructure Revival,” Norman Anderson

For our country to be globally competitive, we will need to nearly triple our level of infrastructure investment each year over the next 10 years, from the current $150 billion level to at least $400 billion per year. And we will need to think differently about infrastructure, designing projects and promoting firms that are carbon neutral, highly innovative, and transformative. Read more…

  • “All in on Health Reform,” Will Marshall

Obama has gone all in; now his party needs to follow. Read more…

  • “Progressives Need to Slam the Right with the Zazi Case,” Jim Arkedis

Najibullah Zazi pled guilty yesterday in what should be a major coup for the administration. Right now, they’re not exploiting it for all it’s worth. Read more…

  • “Financial Regulation Is Good — But Consumer Financial Protection Is Better,” Mike Derham

Paul Volcker, vanquisher of inflation in the early ’80s as chairman of the Federal Reserve System and now the chairman of President Obama’s Economic Recovery Advisory Board, said, “[T]he most important financial innovation that I have seen the past 20 years is the automatic teller machine.” Read more…

  • “Conservatives Let Their Freak Flag Fly,” Ed Kilgore

The tea partiers have seized on 1776 rhetoric and imagery not just because of the anti-tax nature of the original Tea Party, but because they argue with considerable consistency that the cure for America’s ills is a rollback of much of the country’s political and constitutional developments over not just years or decades, but centuries. Read more…

Evening Fix

Friday, February 26th, 2010
Elbert Ventura



Elbert Ventura is the managing editor of Democracy: A Journal of Ideas. He formerly served as the managing editor of the Progressive Policy Institute.

by Elbert Ventura

Some of the day’s best reads:

  • William Galston on innovation and competition: “We’re not investing adequately or strategically in our nation’s future, and we’ll pay a huge price if we don’t change course.”
  • NYC Schools Chancellor Joel Klein on charter schools: “For education truly to be the great equalizer requires that all students have access to high-quality schools. By creating options in long underserved neighborhoods, charters are helping to level the playing field.”
  • Marc Gunther on Wal-Mart’s decision to reduce carbon emissions from its global supply chain: “[T]he companies that supply WMT — that is, Procter & Gamble, Unilever, Clorox, Coca-Cola, PepsiCo, Kraft, General Mills, Sony, Apple, HP, Dell and hundreds more, all of whom must be wondering about their carbon emissions right now — will be asked to make things more efficiently, use less energy, buy more recycled content and the like.”
  • Ben Casnocha on culture and entrepreneurship: “The single best reason to be long on the future of the U.S. is it has a culture of entrepreneurship. It was born this way.”
  • Financial Times‘ Sheila McNulty on why environmentalists need to support nuclear power: “While everyone would love to think of the future powered on ideal energy sources such as wind and solar, the reality is that these power sources require backup generation. As of now, they only account for a few percentage points of US power supply. They are a long way from reaching the scale and level of sophistication required to power the world. The advantages of nuclear will remain attractive for quite some time. “

Two More Scooped Up in Zazi Case. Where Are Progressives?

Friday, February 26th, 2010
Jim Arkedis



Jim Arkedis is the director of PPI's National Security Project.

by Jim Arkedis

Two men who were already in custody, Adis Medunjanin and Zarein Ahmedzay, were charged (along with Najibullah Zazi) in a plot to attack New York’s subway system. The plot was derailed by federal agents back in September, just days before it was set to be executed.

Details of the plot continued to emerge at the previously scheduled hearing for the two men Thursday when Jeffrey Knox, the assistant U.S. attorney, strongly implied that Medunjanin and Ahmedzay were two of the operatives in the “three coordinated suicide-bombing attacks on Manhattan subways during rush hour.” Knox added that the plot was undertaken at the direct command of al Qaeda’s central leadership. That’s a heavy charge, and I’m normally skeptical of prosecutors making grandiose assertions to attract press attention. But — bin Laden’s direction or no — the fact remains that this was a very real plot with very real consequences.

After three significant arrests, I’ll restate the question I asked the other day: Where are progressives on this one? Yet again, we have a large-scale terrorist plot against a major American target that was successfully thwarted due to the good work and cooperation of our law enforcement and intelligence communities. The civilian court system has already gotten one guilty plea out of the ringleader (Zazi), and he’s continuing to provide intelligence. Progressives should be pounding their chests about a strong victory against a ruthless enemy.

But instead, as Greg Sargent at The Plum Line quotes one Democratic strategist saying, “We’re behaving like the President has a 30% approval rating. On these [national security] issues, Democrats inherently believe no one will believe our arguments” (a quote that admittedly was made before the Zazi guilty plea, though the sentiment still applies).

It’s time to snap out of it. I argued before that progressives have to respond to conservative attacks (if they’re brazen enough to criticize the Zazi case…wait a minute, I forgot who we’re dealing with here — of course they’re brazen enough), not on policy grounds, but with forceful rhetoric. National security is an emotional issue for Americans, not a policy one. Using the Zazi case to show our strength and smarts to contrast conservatives recklessness is an argument that continues to resonate. We’ve got great ammo — let’s use it.

Photo credit: http://www.flickr.com/photos/99887786@N00/ / CC BY-NC-ND 2.0

All in on Health Reform

Friday, February 26th, 2010
Will Marshall



Will Marshall is the president of the Progressive Policy Institute.

by Will Marshall

There’s something poignant about President Obama’s attempts to reason with congressional Republicans. He keeps hoping that facts, evidence, and logic somehow can penetrate the depleted-uranium armor of conservative ideology. As yesterday’s health summit showed, it hasn’t worked, but a public frustrated with Washington’s tribal politics will probably appreciate the effort anyway.

The summit nonetheless achieved its real purpose, which was not composing differences but illuminating the two parties’ starkly contrasting visions for health care reform so that the voters can make a real comparison. For the past year, Republicans have had the advantage of attacking (often dishonestly) Democrats’ plans without anyone paying much attention to what they have to offer.

The summit put them on the spot, and the clear answer was: not much. Here’s what we learned about what Republicans mean by reform:

First, they don’t much care about health care’s “have nots” – 45 million Americans without coverage. Sure, they favor a modest expansion of coverage to about three million people, but that only begs the question of why the lucky few and not everyone? The answer is that Republicans don’t really believe it’s government’s responsibility to make sure everyone can get access to affordable coverage.

Second, Republicans do care about restraining rising health care costs for those with coverage. But their preferred solutions — medical savings accounts, and allowing people to buy cheaper insurance policies out-of-state — are tilted toward the healthy. The former takes healthy people out of insurance pools, raising premiums for those who remain. The latter allows people to end-run state mandates on the medical services insurance companies must offer. That’s fine for healthy people who can get by with bare-bones coverage, but it doesn’t help the sick. In fact, Republicans generally oppose the insurance market reforms that would prevent companies from cherry-picking healthy customers or dropping people when they get sick.

Third, the GOP has no intention of helping Obama and the Democrats improve their plans, let alone pass them. They feel little pressure to do so, because they think they have the public on their side.

It’s true that polls show majorities are leery of the Democrats’ reform proposals, even if Americans still want Obama to “do something” about health care costs and coverage. Rather than crumble in the face of public skepticism, Obama adroitly used the summit to reframe the health care debate as a choice between action or inaction on one of the nation’s most vexing problems.

The spotlight now shifts to his party. Will liberals torpedo health reform because it doesn’t include the public option? Will moderates play it safe or take a risk for the larger good of their party and their country? Will health care reform be a casualty of that hardy perennial of the culture wars, abortion?

Can congressional Democrats, in short, summon the will and discipline to rise above their own centripetal forces and govern? It should be obvious that failure would reinforce the Republican narrative: the bill was misbegotten in the first place, an overly ambitious, big-government monster that couldn’t even pass muster with Democrats.

Obama has gone all in; now his party needs to follow.

Grumpy Old Party

Friday, February 26th, 2010
Ed Kilgore



Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

If you are unemployed, or if you are one of the millions of people hanging on to cancelled employer-sponsored health insurance via COBRA, your life will take a turn for the more insecure on Sunday, thanks to Sen. Jim Bunning (R-KY), who wants to make a symbolic gesture about federal spending. Bunning is refusing to let the Senate vote on totally noncontroversial extenders for these provisions, which will probably force a cloture vote and at least a week’s delay in restoring unemployment insurance and COBRA.

What makes this weird is that Bunning is taking this action not to secure any concessions on present or future legislation, but to express his grumpiness about something that’s already happened: Senate passage of the first chunk of jobs legislation by a 70-28 vote.

Now you have to appreciate that Bunning is a very angry old man. Never a very genial soul, he was pushed into retirement by his own party because it looked like he would be defeated even in a good Republican year, in part because he’s exhibited some signs of being a few bricks shy of a load. So he’s mad at his colleagues, and maybe even mad at his constituents, for their failure to let him serve in the Senate into his ninth decade of walking the earth.

The most appropriate response to Bunning’s grievances is probably the words the senator himself contemptuously uttered yesterday to Sens. Dick Durbin and Jeff Merkley when they cited the plight of the unemployed and soon-to-be-uninsured in asking him to let the extenders come to a vote: “Tough s__t!” The people he’s affecting with his little fit of pique have a lot more to complain about than Bunning, who’s largely wasted twelve years in the Senate being a grumpy old man. But he is a fitting symbol of the obstructionism of his party in Congress, which knows no bounds and feels no shame.

This item is cross-posted at The Democratic Strategist.

Does KIPP Get Results?

Friday, February 26th, 2010
Elbert Ventura



Elbert Ventura is the managing editor of Democracy: A Journal of Ideas. He formerly served as the managing editor of the Progressive Policy Institute.

by Elbert Ventura

In education circles, the Knowledge Is Power Program (KIPP), the nation’s largest charter management organization, is considered one of the great success stories in the charter school movement. But as Quick and the Ed’s Chad Aldeman points out, even though an observer of a KIPP classroom can immediately tell the difference, quantitative analyses of KIPP’s real-world effects have been sparse and low-level — which is why the National Bureau of Economic Research’s new study (PDF) of a KIPP charter school in Lynn, Massachusetts, the sole KIPP school in New England, is noteworthy.

As with other KIPP schools across the country, the Lynn school has a long school year that starts in August and includes some Saturdays, and a long school day running from 7:30 am to 5:00 pm. The school has a code of behavior that calls for orderly movement between classes and students to speak only when called upon. The curriculum puts a strong emphasis on basic reading and math skills.

The study was a quasi-experimental evaluation that compared students who attended KIPP with those who wanted to attend but couldn’t get in because of space restrictions. In Massachusetts, charter schools are required to hold a lottery for admission if a school is oversubscribed. Because KIPP Lynn’s enrollees are determined by a randomized lottery, the study was able estimate the causal effect of the program on achievement without the problem of selection bias — the idea that a charter school gets results by “skimming from the top” of a given demographic — tainting the results.

What did the researchers find? KIPP Lynn attendees registered Massachusetts Comprehensive Assessment System (MCAS) gains of about .12 standard deviations for each year that a student stayed in KIPP. For math, the gains were even larger at .35 standard deviations for each year. The results for limited English proficiency (KIPP Lynn has a high proportion of Hispanic students) and special education students were even more positive.

While it’s just one study for one school, the NBER analysis is a well-designed quasi-experiment that offers robust quantitative evidence for KIPP’s effectiveness. (Aldeman calls it “by far the most rigorous of all the evaluations thus far that specifically focus on KIPP.”) As the researchers point out, KIPP has a replicable model and runs similar schools across the country, and it’s not hard to imagine that KIPP has had similar effects at other sites. Of course, more studies like this are needed to measure KIPP’s results. But in the meantime, the NBER study should embolden charter proponents, who seek to bring demonstrably successful models to areas badly in need of alternatives for students willin and eager to learn.

Photo credit: http://www.flickr.com/photos/mlleleela/ / CC BY-ND 2.0

Evening Fix

Thursday, February 25th, 2010
Elbert Ventura



Elbert Ventura is the managing editor of Democracy: A Journal of Ideas. He formerly served as the managing editor of the Progressive Policy Institute.

by Elbert Ventura

Some of the day’s best reads:

  • Peter Beinart urges Democrats to pass health reform through reconciliation: “The GOP actually has a point here: There is something undemocratic about passing laws that a majority of Americans oppose. We just don’t happen to live in a democracy; we live in a democratic republic.”
  • The Hill on Charlie Crist sounding more and more like an independent: “The campaign is definitely headed in a different direction, which is to be understood, what with its declining poll numbers. The question is what kind of direction.”
  • Politico on the left’s suspicions over a deficit reduction commission: “Liberals aren’t entirely enthralled by the concept of a deficit commission, let alone one that gives a voice to a prominent conservative such as former Wyoming Sen. Alan Simpson.”
  • Political scientist John Sides on conservatives and government spending: “Conservatives agree that the government spends too much. But ask them what to cut…”
  • A Denver Post photo essay on the U.S. offensive in Marjah.

Financial Regulation Is Good — But Consumer Financial Protection Is Better

Thursday, February 25th, 2010
Mike Derham



Mike Derham is chair of PPI's Innovative Economy Project.

by Mike Derham

Paul Volcker, vanquisher of inflation in the early ’80s as chairman of the Federal Reserve System and now the chairman of President Obama’s Economic Recovery Advisory Board, said, “[T]he most important financial innovation that I have seen the past 20 years is the automatic teller machine.” While he qualified the comment as a “wiseacre remark,” he stood by it, going on to say, “Indeed, it was quite good in the 1980s without credit-default swaps and without securitization and without CDOs.”

Our friend Bob Litan has a new report out from the Brookings Institution on the benefits from financial innovation over the past thirty years. The report is worth reading in full, but a quick summary of his findings is found in a chart at the beginning of the paper (condensed into one image by Kevin Drum):

Given attitudes like Volcker’s, it might be surprising to see so many “+”s, connoting relative benefits, relative to “-”s, connoting developments that did not improve that part of the economy. (“0″ indicates the innovation was a wash.) But that is the reality of innovative financial instruments — they are, by and large, designed to be beneficial, but unmonitored can cause more harm than good. Innovations like credit scoring, collateralized debt obligations (CDOs), and inflation-protected Treasury bonds (TIPS) — all were developed since Volcker was Fed chair. But the benefits from these innovations (increased access to credit, which allows for consumption smoothing) can also lead to abuses of the system (crushing credit card debt, NINA mortgages, balloon payment mortgages) and asset bubbles. These abuses can be swept under the rug if the underlying assets in a CDO are not transparent, and that CDO is sold to an unsuspecting client by an investment bank trading desk.

The status quo is unsustainable, but attempts to ban some of these activities are problematic as well. Proclamations like the Volcker rule – limiting the scope of bank activity — are either too tightly defined to be effective or are so broad they throw out the above benefits with the bathwater. What would be better is to provide transparency in these activities — through clearing credit default swaps (CDS) and other derivatives on exchanges, providing credit terms in an easily understood manner upfront, and eliminating hidden fees — so that all involved know what they are getting into.

Litan also points out one key fact at the end of his paper: we’re not done with financial innovation. He argues that despite the headlines, not all innovation is bad, and there is more to come. He cites the work of Robert Schiller, the Yale professor who has pioneered work in housing price markets — designed to give homeowners protection they currently don’t have against a fall in the value of their home — and counter-cyclical tax policy, as an obvious source of financial innovation that is for the good.

But Litan concludes by noting that the market — not government — will continue to drive innovation, but “policymakers must be better prepared in the future than they were before the financial crisis to step in — first with disclosure standards and possibly later with more prescriptive rules” to prevent crises like the most recent one from happening again. The one area where he sees a more active government role is in consumer finance, an area in which a robust Consumer Financial Protection Agency will be key.

Walking Dead Incumbents

Thursday, February 25th, 2010
Ed Kilgore



Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

To distract myself from the intense desire to scream while listening to Sen. Jon Kyl (R-AZ) speak at the health care summit, I read a fine post by Nate Silver that explodes the myth that incumbents who don’t hold a majority in early polls are already toasty if not toast. This myth is being used by Republicans to declare a lot of Democrats as walking dead long before campaigns actually develop. Turns out, though, the available evidence doesn’t support that proposition. Here’s Nate’s conclusion:

1) It is extremely common for an incumbent come back to win re-election while having less than 50 percent of the vote in early polls.2) In comparison to early polls, there is no demonstrable tendency for challengers to pick up a larger share of the undecided vote than incumbents.

3) Incumbents almost always get a larger share of the actual vote than they do in early polls (as do challengers). They do not “get what they get in the tracking”; they almost always get more.

4) However, the incumbent’s vote share in early polls may in fact be a better predictor of the final margin in the race than the opponent’s vote share. That is, it may be proper to focus more on the incumbent’s number than the opponent’s when evaluating such a poll — even though it is extremely improper to assume that the incumbent will not pick up any additional percentage of the vote.

Nate goes on to say that a much narrower version of the “50% incumbent rule,” which focuses on polls taken late in an election cycle, has more merit, but isn’t really a “rule” either. On the other hand, incumbents who register at above 50% in early polls do typically win. This ought to be kept in mind by Republicans who are fantasizing about a late “wave” that will sweep popular Democratic incumbents (and there are some) out of office.

This item is cross-posted at The Democratic Strategist.

Summit Spectacle

Thursday, February 25th, 2010
Ed Kilgore



Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

Like many of you, I’ve been watching the health care summit, and can’t decide just yet if it’s a spectacle of complex drama, or just one of the longest congressional hearings to be broadcast in a long time. For those unfamiliar with congressional events, the preliminary throat-clearing and personal preening must be excrutiating.

The Republican strategy for this event is pretty clear already: act like the administration is doing something really outrageous by using reconciliation to finalize the health care legislation already passed by both Houses. As I mentioned yesterday, this is factually ludicrous, but repeating talking points does sometimes work.

It’s pretty interesting that tea partiers are protesting the very existence of the event outside Blair House. Appointing themselves representatives of the people, and making unconditional demands on their behalf, has been a hallmark of their movement all along.

Editor’s note: The summit is being webcast live on C-SPAN.

This item is cross-posted at The Democratic Strategist.

Public Transit: Good for Your Wallet

Thursday, February 25th, 2010
Elbert Ventura



Elbert Ventura is the managing editor of Democracy: A Journal of Ideas. He formerly served as the managing editor of the Progressive Policy Institute.

by Elbert Ventura

Todd Litman of the Victoria Transport Policy Institute, a Canadian research organization, came out with an interesting new study (PDF) that makes a strong pocketbook case for high-quality public transit.

The study looked at seven major U.S. cities with high-quality public transit systems: Washington, D.C., New York, Boston, San Francisco, Chicago, Philadelphia, and Baltimore.

The study’s findings shouldn’t surprise public transit aficionados. According to Litman, residents of cities with good public transit tend to own 10-30 percent fewer vehicles and drive 10-30 percent less than they would in more automobile-oriented communities.

But the study also calculated what exactly good public transit meant for residents’ wallets:

[P]roviding high quality public transit service typically requires about $268 in annual subsidies and $108 in additional fares per capita, but reduces vehicle, parking and road costs an average of $1,040 per capita. For an average household this works out to $775 annually in additional public transit expenses and $2,350 in vehicle, parking and roadway savings, or $1,575 in overall net savings…[emphasis added]

Those results don’t even take into account the other benefits a city can derive from a high-functioning transit system: a decrease in pollution, less congestion, fewer traffic accidents, and improved public fitness and health.

What’s striking about Litman’s study is that its conclusions are something that transit-using city-dwellers tend to grasp intuitively. Commuters know firsthand the benefits of not having to rely on a car to get around the city — not having to deal with parking, congestion, gas, upkeep and insurance costs, etc.

But as Litman points out, most American cities offer only basic public transit services that are used mainly by people who have no other alternatives. In cities with good public transit, even affluent residents use the system, as they recognize its benefits. It all points to a fairly obvious upshot: cities should place public transit higher on its list of funding priorities.

Studies like Litman’s also bring up another important dimension in all this: political will. Americans love their cars but — especially in tough economic times — would they love them as much if they were informed that a strong alternative would save them an average of $1,500 a year? Something tells me a citizenry informed of the considerable savings from a good Metro or bus system could be nudged toward supporting more robust funding for a well-developed transit infrastructure.

Evening Fix

Wednesday, February 24th, 2010
Elbert Ventura



Elbert Ventura is the managing editor of Democracy: A Journal of Ideas. He formerly served as the managing editor of the Progressive Policy Institute.

by Elbert Ventura

Some of the day’s best reads:

  • Mike Mandel on why the innovation economy isn’t creating more jobs: “I suggest that outside of a few high-profile exceptions, a wide range of potential breakthrough innovations have fallen short of promise since 1998. That has produced many fewer jobs in the U.S., and diluted America’s comparative advantage abroad.”
  • Sen. Mark Udall interviewed by David Roberts of Grist on energy policy: “I think it’s crucial to price carbon.”
  • Brendan Nyhan has a table showing bills that have been passed via reconciliation since 1980.
  • Peter Hakim on Brazil’s rise and what it means for the hemisphere: “Brazil is now a regional pole of power in the Western Hemisphere and occupies a particularly central role in South America, where on many issues it has displaced the U.S. as the dominant presence.”
  • Ezra Klein previews tomorrow’s health care summit.