Daily Digest - January 18: The Future is Not Now

Jan 18, 2013Tim Price

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The Dwindling Deficit (NYT)

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The Dwindling Deficit (NYT)

Paul Krugman argues that in the medium term, there is no deficit crisis to speak of, and in the long term, the future is just too unpredictable for us to solve our problems by having 2040's budget debates today, unless Marty McFly makes a run for Congress.

Republicans: Okay, Maybe We Can't Shoot the Hostage, But Maybe We Can Slap Him Around or Something (New York)

Jonathan Chait notes that as House Republicans gather for a retreat to talk debt ceiling strategy, they seem to be caught between their realization that threats to force the U.S. to default are a bad idea and their overwhelming desire to give the president agita.

Congressional Progressives: Abolish the Debt Ceiling (The Nation)

Anna Simonton writes that the members of the Congressional Progressive Caucus are introducing a bill to eliminate the debt ceiling. But then how would Congress decide how much the government can spend? Just vote on it? Oh, they already do that? ...Oh.

Markets to Washington: You know nothing of our work. (WaPo)

Even though the Beltway consensus seems to be that the markets demand immediate deficit reduction and that the government's incompetence will drive interest rates higher, Neil Irwin notes that there are some prominent dissenters, such as actual investors.

The Legacy of Timothy Geithner (NYT)

Simon Johnson writes that Geithner's support for keeping too-big-to-fail banks super-sized casts a deep shadow over his legacy, which will forever be that of the guy who somehow made the GOP look like champions of Main Street in comparison.

Obama's Second Act (HuffPo)

Robert Borosage argues that President Obama must seize his second term as an opportunity to develop a new vision of shared prosperity, which would if nothing else help to keep him too busy to get involved in anything Fox News can add a "-gate" after.

Can These New Federal Rules Rein in Foreclosure-Frenzied Banks? (MoJo)

Erika Eichelberger looks at the CFPB's new rules for loan servicers, which include burdensome requirements like "make sure borrowers know what the hell they're agreeing to" or "don't foreclose on people while telling them how to avoid foreclosure."

JPMorgan's Jamie Dimon Offers Illusion of Transparency (Bloomberg)

Jonathan Weil notes that the official report on the London Whale debacle omits a few key details, like who was involved and why they were allowed so much leeway, due to the restrictions posed by UK law and by total disinterest in answering those questions.

JPMorgan's Board Uses a Pay Cut as a Message (NYT)

Jessica Silver-Greenberg writes that the board of JPMorgan intends to show the world who's boss by cutting Jamie Dimon's compensation to a mere $11.5 million for 2012. If he doesn't shape up, he might even lose his weekend pass to the unicorn stables.

Elected by 32 Donors, for 32 Donors (Prospect)

A new report from Demos and U.S. PIRG finds that the top 32 donors in the 2012 election cycle matched all donations made by the 3.7 million small donors who were silly enough to think $200 was actually a useful contribution without a few zeroes tacked on.

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Daily Digest - January 17: Save and Save Often

Jan 17, 2013Tim Price

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New Purpose of Government is Better Government (Bloomberg)

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New Purpose of Government is Better Government (Bloomberg)

Ezra Klein writes that when Republicans get tired of beating their heads against the walls of the welfare state, the scope of government's responsibilities will finally be settled. But don't worry; there will still be plenty of pointlessly convoluted methodology to argue about.

Here's What Happened the Last Time the U.S. Defaulted on Its Debt (The Atlantic)

Matthew O'Brien notes that the market reacted badly in 1979 when the Treasury temporarily defaulted due to a word processor glitch. So how willing are we to stake the health of the economy on the chance that Microsoft Word won't crash? Clippy can't help us now.

States Gave Gunmakers $49 Million in Tax Breaks Over the Last Five Years (Think Progress)

Pat Garofalo writes that as the president begins his push for tougher federal gun control laws, states are reexamining their own support for the industry given the futility of trading tax cuts for jobs and the dubious honor of being the bullet-making capital of the U.S.

Banker pay is (finally) falling (WaPo)

Neil Irwin examines the trend toward reduced compensation on Wall Street, where banks may be twigging to the fact that recruiting the best and the brightest and handing them the keys to the universe is no guarantee that they won't just run it into a ditch.

The U.S. Gets Left Behind When It Comes to Working Women (Forbes)

NND Editor Bryce Covert notes that women's participation in the workforce has flatlined in the U.S. while other countries have jumped ahead thanks to policies that recognize having kids isn't some annoying employee habit like playing music too loud at your desk.

Are Walmart's Jobs for Vets Any Good? (The Nation)

Josh Eidelson writes that Walmart has gotten a lot of good press for pledging to hire 100,000 veterans over the next five years, but given the low wages and poor working conditions such jobs entail, it's not entirely clear whether that's a promise or a threat.

As manufacturing bounces back from recession, unions are left behind (WaPo)

Jim Tankersley notes that while manufacturing jobs have indeed started coming back from the grave since 2009, these zombified positions lack the good pay and benefits that they carried with them in a past life, and that's one reason the recovery's still shambling.

Proposals to drug-test the unemployed gain momentum (Salon)

Natasha Lennard reports that ALEC-backed laws requiring drug testing for the recipients of unemployment benefits and even food stamps are gaining traction in many statehouses. Republicans get what they want, and they really want to get their hands on some urine.

Vacation Homes for the Rich, Courtesy of Uncle Sam (Prospect)

Abby Rapoport looks at a study that shows the U.S. spends $450 billion a year on real estate programs like the Mortgage Interest Deduction, which provides sorely needed relief to those on the market for a second house to visit when they get bored with their first.

Wall Street Journal Deeply Concerned About the Fate of Rich Single Moms (Slate)

Matthew Yglesias highlights an infographic that explains how the Obama tax increases will affect Americans from all walks of life, from a single mom struggling to keep herself in blazers on $260,000 a year to a family of six bringing in only $100,000 per capita.

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Daily Digest - January 16: I am Jack's Bad Budget Metaphor

Jan 16, 2013Tim Price

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Does America Need Jack Lew? (Harper's)

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Does America Need Jack Lew? (Harper's)

Roosevelt Institute Senior Fellow Jeff Madrick explains his concerns about Lew at Treasury: he's hazy on what caused the financial crisis and overly concerned about budget deficits. In other words, he fits right in with the rest of the president's economic team.

Ruth Porat, Rumored Treasury No. 2, Lobbied Regulators for Morgan Stanley, a Lot (HuffPo)

Perhaps acknowledging Lew's admitted lack of experience in the world of finance, Mark Gongloff notes that President Obama may name him a deputy with a deep background in regulatory negotations. Only problem? She's usually on the wrong side of the table.

JPMorgan Chase Gambles Away $6B, Gets "Slap on the Wrist" (MoJo)

Erika Eichelberger writes that after investigating the London Whale fiasco, the OCC and the Fed have issued their tough verdict: it's bad for banks to lose money and/or launder it for drug dealers and terrorists, so they should knock it off or else [consequences].

All the President's Resolve (Prospect)

Robert Kuttner argues that it's a good sign that President Obama appears to be stiffening his spine for the debt ceiling fight instead of bending over backwards to please the GOP, but if he wants to correct his posture, he should lean a little more toward the left.

Millennials and Guns (The Nation)

Roosevelt Institute | Campus Network members Ryan Dahrouge and Jamira Burley write that Millennials are determined to end gun violence, but unlike some culture critics, they won't do it by erasing the word "gun" from that sentence. Read the full report here.

Race, Gun Control and Unintended Consequences (The Nation)

NND Editor Bryce Covert writes that fast action on gun control is better than the inertia we're all used to, but like guns themselves, we should focus on how the laws will be used, not just the possibly false sense of security that they provide.

The Eurozone Crisis Is Over, but the Eurozone Economy Is Worse Than Ever (Slate)

Matthew Yglesias notes that while many observers, including the European Central Bank itself, have decided that they can safely stop caring about the eurozone, things probably aren't going great if they're now judging their success relative to Latvia.

When Public Outperforms Private in Services (NYT)

Using BP as a particularly disastrous case study, Eduardo Porter argues that when deciding which services are best provided by the private sector, we should remember that "do this profitably" and "do this correctly" are two very different mission statements.

The troubling state of America's health (WaPo)

Katrina vanden Heuvel highlights a report that shows America is one sick country, and one of the leading causes of our illness is an inadequate safety net. So Congress wants to cut government health care, prolonging the bleeding until our humors are rebalanced.

For 'Party of Business,' Allegiances Are Shifting (NYT)

The GOP and big business used to be joined at the hip, but Jackie Calmes reports on a growing tension caused by up-and-coming Republicans who answer to no one but themselves and maybe their neighbor's talking dog who tells them not to raise the debt ceiling.

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Daily Digest - January 15: The Default Option

Jan 15, 2013Tim Price

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Obama to Republicans: You Have No Choice but to Raise the Debt Ceiling (Prospect)

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Obama to Republicans: You Have No Choice but to Raise the Debt Ceiling (Prospect)

Jamelle Bouie writes that President Obama used the final press conference of his first term to remind voters that he's the one who's just trying to pay the country's bills while Republicans are setting the checkbook on fire and giggling at the pretty colors.

Half of Republicans in Congress Are Apparently Cool With America Defaulting (MoJo)

Andy Kroll notes that reports suggest GOP leaders know a debt ceiling standoff is a bad idea, but they feel they need to let the rank and file have a go at it and find out for themselves, like when a child insists he wants spaghetti and chocolate syrup for dinner.

The President's Priorities Are Not in Order (Esquire)

Charles Pierce argues that while the president has polished up the pitch for his "balanced" approach to budgeting, voters have never bought what lawmakers are selling about deficits being the top economic priority. You can't buy groceries with deficit reduction.

The Debt Ceiling Is Scarier Than the Fiscal Cliff (WSJ)

Alan Blinder warns that allowing the U.S. to default would be unprecedented, but even tumbling over the fiscal cliff would be preferable to letting the economy be smashed against the debt ceiling. Only Congress could make going up worse than falling down.

If we hit the debt ceiling, can Obama choose which bills to pay? (WaPo)

Brad Plumer notes that Republicans insist that if we hit the debt ceiling, the Treasury can avoid default by prioritizing payments, like when you pay your rent before the cable bill. Except instead of missing an episode of Girls, you could tank global financial markets.

The 3 Percent Cut to Social Security: aka the Chained CPI (HuffPo)

Dean Baker writes that cutting Social Security benefits is a bad way to achieve deficit reduction, is so politically toxic that no one would actually campaign on it, and directly contradicts promises that were made to voters, so naturally, it's almost inevitable.

401(k) breaches undermining retirement security for millions (WaPo)

Michael Fletcher reports that while lawmakers whittle away at the public retirement programs all Americans rely on, workers are raiding their other savings to make ends meet. But now that they can never retire they'll never need those savings, so it's win-win, right?

The Foreclosure Fiasco (NYT)

Joe Nocera argues that the latest $8.5 billion foreclosure settlement is another pointless P.R. exercise that solves nothing and helps no one, which seems a bit counterproductive given that all these settlements tend to do is generate terrible P.R. for everyone involved.

Foreclosure Review Insiders Portray Massive Failure, Doomed From The Start (HuffPo)

Ben Hallman and Eleazar David Melendez go behind the scenes of the Independent Foreclosure Review, which turned out to be not very independent and less of a review than a guessing game for which bank managers got to create their own answer key.

Bold new conservative ideas still mostly involve screwing the poor (Salon)

Alex Pareene checks in on the GOP's efforts to rebrand itself as the party of fresh thinking and innovative policy solutions, which so far involves raising sales taxes and advocating for missile defense systems. Keep at it, guys. Please don't let us disturb you.

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Daily Digest - January 14: Geithner's Goodbye

Jan 14, 2013Tim Price

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The Tim Geithner Era (Slate)

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The Tim Geithner Era (Slate)

Matthew Yglesias looks back on the mixed record of Tim Geithner, the influential Treasury Secretary who seemingly only managed to convince one person that he had all the answers, but lucked out with that person being the President of the United States.

The Mortgage Mess and Jack Lew (Prospect)

Robert Kuttner argues that progressives should press hard on Jack Lew to find out whether he would have let the latest mortgage settlement happen on his watch -- once they're finished rolling their eyes at the president's praise for his budget-balancing skills.

Treasury: We won't mint a platinum coin to sidestep the debt ceiling (WaPo)

Ezra Klein reports that life has killed the dream we dreamed, as the Treasury Department says it won't mint a trillion-dollar coin and the Federal Reserve wouldn't accept it if it did. The only option on the table is for Congress to do the right thing. God help us all.

The Platinum Coin Wouldn't Have Been Goofy to FDR (Bloomberg)

Jonathan Alter notes that despite the absurdity of ideas like the platinum coin, FDR used tactics, like moving off the gold standard, that were no less gimmicky. But he wasn't worried about his critics' jokes given how often the punch line was "and it worked."

Japan Steps Out (NYT)

Paul Krugman writes that Japan, not really a hotbed of radical economic thought, is breaking with the orthodoxy under prime minister Shinzo Abe, whose push for stimulus and inflation is upsetting austerity advocates by failing to upset anyone else.

Obama's Job One: Middle-Class Employment Problems Loom Over Second Term (HuffPo)

Dave Jamieson and Arthur Delaney note that after campaigning on a promise to restore the middle class, President Obama must now figure out how to do that when immigration reform and gun control look like safer bets than getting Congress to care about jobs.

Why the Unemployment Rate Is So High (NYT)

Laura D'Andrea Tyson argues that the evidence shows the U.S. doesn't have a structural unemployment problem, but by letting the unemployed languish for months and years with no new support or opportunities in sight, we're doing our best to create one.

Ouch! No, you're not imagining it. Your paycheck just shrank. (WaPo)

Neil Irwin notes that the expiration of the payroll tax cut became evident with the arrival of the first paychecks of 2013 last week. The question is how many Americans will make cutting back on spending their retroactive New Year's resolution.

This Week in Poverty: Smiley Calls for White House Conference on US Poverty (The Nation)

Greg Kaufmann offers a sneak peek at an upcoming forum that calls for a national plan to end poverty within the next 25 years, and how it could serve as a useful reminder to the White House that a good way to start helping people is by asking what they need.

Paying the Price, but Often Deducting It (NYT)

Question: When is a settlement not a settlement? Answer: When it's also a tax break. Gretchen Morgenson notes that banks may write their payments from recent foreclosure settlements off as business expenses, because there's no budget for shame.

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Daily Digest - January 11: Coin-Operated Government

Jan 11, 2013Tim Price

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Coins Against Crazies (NYT)

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Coins Against Crazies (NYT)

Paul Krugman makes his case for minting the trillion-dollar platinum coin: it might sound like a big joke, but it's better to find a way to laugh off the debt ceiling threat than to allow Republicans to turn the full faith and credit of the United States into a punch line.

Debt Ceiling and Guns: Using Presidential Authority to the Fullest (Robert Reich)

Reich argues that the debt ceiling and mass gun violence both pose a threat to the U.S., and in times like this the president must use every obscure power at his disposal to protect the country. Even Superman had to pull out the super-ventriloquism on occasion.

The Debt Ceiling's Escape Hatch (NYT)

If coins don't cut it for you, Edward Kleinbard suggests the White House could sidestep the debt ceiling by issuing IOUs to the people and institutions to whom it owes money. Better yet, it could make them green and adorn them with the faces of dead presidents.

The debt reduction that's already happened (MSNBC)

Steve Benen notes that if we're going to treat deficit reduction as a priority, we should acknowledge that Obama has already signed $2.4 trillion worth into law, mostly in the form of spending cuts. Or does that make spending cuts socialist by the transitive property?

On Budget Cuts, the Political Gap is Informational, Not Ideological (Yahoo! Finance)

Dean Baker writes that the budget stalemate isn't caused by entitlements, because the Republican base doesn't want to cut them either. In fact, they don't want to cut most things, but they're convinced the deficit is driven by the U.S. equivalent of the Ministry of Silly Walks.

Is Jack Lew a Friend to Wall Street? (National Journal)

Michael Hirsh argues that sending Jack Lew to Treasury will continue what Roosevelt Institute Senior Fellow Rob Johnson calls the "Wall Street trading culture" of the Obama administration, which is often too busy watching out for banks to do much watching over them.

The Reason Republicans Don't Like Jack Lew (Slate)

Matthew Yglesias notes that the GOP's formerly cordial relationship with Jack Lew turned sour during the 2011 debt ceiling negotiations, when he repeatedly foiled their attempts to cut a deal by being that guy who knows things and understands how numbers add up.

Betrayed by Basel (NYT)

Simon Johnson writes that the Basel Committee's decision this week to water down its liquidity requirements for banks illustrates the danger of leaving international regulation in the hands of eurozone countries who have enough trouble regulating themselves.

The Global Domestic Workforce is Enormous -- and Very Vulnerable (The Nation)

NND Editor Bryce Covert notes that a new report shows that there were at least 52.6 million domestic workers worldwide as of 2010, but given how poor working conditions are and how slow improvement has been, its best news for them is that misery has company.

Hilda Solis steps down as Labor Secretary. So how did she do? (WaPo)

Hilda Solis announced her resignation this week, and while she might not have cut a Frances Perkins-like profile for herself, Brad Plumer writes that she acquitted herself well for someone competing with the Secretary of Commerce for most obscure Cabinet position.

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The Platinum Coin is as Absurd as the Problem It Solves, and That's a Good Thing

Jan 10, 2013Tim Price

President Obama can beat Republicans in the debt celing standoff by turning their own tactics against them.

President Obama can beat Republicans in the debt celing standoff by turning their own tactics against them.

Not since Samuel L. Jackson announced his desire to have the snakes removed from his passenger flight has a single sentence thrilled the Internet as much as Chuck Todd’s question at yesterday’s White House press briefing: “Do you guys have a position on this trillion-dollar coin business?” At the same time, one could hear the collective groan of critics who hoped the whole coin idea would stay buried in online obscurity rather than become a topic of discussion for people with actual influence. It’s understandable that the silliness of the trillion-dollar coin rubs its opponents the wrong way, but it’s that very silliness that makes it the perfect response to the ridiculous state of American politics.

The precise origins of the trillion-dollar coin are a matter of debate (some credit blog commenter “beowulf” for the idea, while others trace its inspiration to nuclear energy magnate Montgomery Burns), but in the last week it’s become a preoccupation of the economic blogosphere. The particulars have been covered in exhaustive detail elsewhere (see The Atlantic’s Matthew O’Brien for a good overview), but the short version is this: due to a loophole in commemorative coin law, the Treasury Department technically has the power to mint a platinum coin with a face value of $1 trillion, deposit that coin in the Federal Reserve, and use the funds to pay its debts if Congress fails to raise the debt ceiling in time to avoid default.

I don’t intend to get into the legal foundation for the platinum coin approach (though experts including Harvard professor Laurence Tribe and the co-author of the law believe it’s sound) or even to suggest that the president might actually go for it. No matter what garbled signals his press secretary sends, Barack Obama is a serious man who doesn’t like stunts. After spending more than four years cultivating an image as the only grown-up in the room, he’s probably not going to step out into the Rose Garden, pull an oversized novelty coin from his pocket, and announce that he just ended the debt ceiling standoff before it started. But that’s too bad, because he totally should.

Non-legal arguments against the coin share a common theme: it’s stupid, and its supporters are sinking to the GOP’s level. Kevin Drum of Mother Jones writes, “This whole thing is not just a ridiculous idea, it's a bad idea too.” Ross Douthat at The New York Times argues that it would be “trying to match the Republicans irresponsibility for irresponsibility, in a constantly escalating game of ‘can you top this?’” Republicans, Drum notes, “seem willing to set the country on fire to please their increasingly fever-swampish base, and eventually they'll pay a price for that at the polls,” so Democrats should just sit back and wait for them to self-destruct. One might have thought that happened in November, when they lost the presidential election, several Senate seats, and the popular vote in the House, but two months later, they’re still in control of the House and still threatening to trigger a global depression out of spite. How’s that working out?

Even supporters of the trillion-dollar coin admit that it’s all very silly, but that’s sort of the point. Republicans’ debt ceiling antics are utterly ridiculous; under the guise of curtailing future spending, they’re threatening to refuse to make good on debts the U.S. already owes because of spending Congress already authorized. They’re so concerned about the health of the U.S. economy that they claim they’re willing to destroy it. It may all be empty posturing, but it only gets them what they want if Obama agrees to play straight man to the clowns and accept a pie in his face for the good of the republic. And as we’ve seen time and again during the president’s first term, pretending that elected Republicans are grown-ups who take their responsibility to govern seriously doesn’t cause them to live up to expectations. Instead, it seems to embolden them to behave even more radically, since they know they can count on someone else to keep the country afloat while they’re busy running around with their pants on their heads.

So yes, President Obama could continue to act as if Republicans are negotiating in good faith and either allow them to extract more painful, unnecessary budget cuts or risk the possibility that they’ll reject his overtures and destroy the U.S.’s credit rating for no particular reason. Or he could flip the script so that the joke’s on them for once. As Jamelle Bouie writes, “The $1 trillion coin is a ridiculous idea. But it’s no less ridiculous than the debt ceiling, and in the big scheme of things, it’s far preferable to defaulting on our obligations.” Minting the coin wouldn’t lower the president to the GOP’s level; it would prevent the GOP from dragging the entire country down with it. If the U.S. had a functioning government and a healthy political debate, we wouldn’t be talking about the debt ceiling or the coin, but it doesn’t, so we are. Pretending that everything’s just fine on Capitol Hill won’t bring Mr. Smith back to Washington, but acknowledging and heightening the absurdity could hasten the exit of the current gang of malcontents and allow more reasonable and responsible leaders to take their place. So if you take policy seriously, it’s time to treat politics as farce. 

Tim Price is Deputy Editor of Next New Deal. Follow him on Twitter at @txprice.

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Daily Digest - January 10: OoooooO, That Lew

Jan 10, 2013Tim Price

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Obama's Pick for Treasury Is Said to Be His Chief of Staff (NYT)

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Obama's Pick for Treasury Is Said to Be His Chief of Staff (NYT)

Jackie Calmes reports that by tapping Jacob Lew to replace Tim Geithner at Treasury, President Obama continues to build his second-term team using the (white, male) members of his first-term team. Some of them have splurged on new tie clips to celebrate.

Jack Lew to Treasury: A Caterpillar Emerges from His Cocoon (New Yorker)

John Cassidy expects Lew to be an easy confirmation who will face opposition from the left as a Rubinite with Wall Street ties, but also thinks he should be given the benefit of the doubt since all we really know about him is that he has trouble writing his name.

The Obama Coalition vs. Corporate America (NYT)

Thomas Edsall notes that big business, which has been the power behind the throne in DC for decades, has a demographic problem: the young, diverse coalition of Obama voters doesn't care for it, and Republicans are tired of having it chained to their ankles.

The Banks Win Again (Prospect)

Robert Kuttner compares last February's major bank settlement, which was so weak the president had to apologize for it by appointing Eric Schneiderman to a task force that didn't really exist, to this year's model, which doesn't even come with a consolation prize.

The Latest Myth About the Government's Mishandling of the Housing Market (ProPublica)

Jesse Eisinger writes that the FHA's minor problems have been overblown by the same critics who treat GSEs and low-income borrowers as the culprits behind the financial crisis. Damn you, poor people. Always trying to pull one over on those unsuspecting banks.

U.S. Consumer Watchdog to Issue Mortgage Rules (NYT)

Edward Wyatt writes that the CFPB will announce rules for "qualified" loans (i.e., the kind that aren't designed to bleed people dry and doom their withered husks to foreclosure) that banks can offer if they'd like to stop being sued for abusing their borrowers all the time.

A White House Meeting With Low-Income Americans (The Nation)

Greg Kaufmann argues that if the president is really open to hearing good ideas from all sides, he could start by canceling his next lunch with Lloyd Blankfein and clearing time on his calendar for the people who will be most deeply affected by the budget negotiations.

A Reminder Why Protecting Social Security Is So Important (On the Economy)

Jared Bernstein writes that with private defined-benefit pension plans going the way of print journalism and cassette players, it's all the more important for the government to absorb the risks of retirement rather than handing workers a gold watch and wishing them luck.

Women Don't Like Libertarianism Because They Don't Like Libertarianism (Forbes)

Joining the debate about why there aren't more libertarian women, NND Editor Bryce Covert argues that it's not because all the cool kids prefer moochers. It's because women are best positioned to recognize that some of libertarianism's basic precepts are nonsense. 

A.I.G. Says It Will Not Join Lawsuit Against Government (NYT)

Michael de la Merced and Ben Protess report that AIG's board has opted not to join former CEO Maurice Greenberg's quixotic lawsuit against the government, but if you stocked up on torches and pitchforks, you should be able to return them for at least store credit.

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Daily Digest - January 9: Don't Worry, Everyone. The Rich Are Doing Fine.

Jan 9, 2013Tim Price

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Shared sacrifice – except for CEOs (Reuters)

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Shared sacrifice – except for CEOs (Reuters)

Roosevelt Institute Fellow Matt Stoller writes that the fiscal cliff deal larded with corporate subsidies is just the latest manifestation of a lopsided tax system in which many companies owe their CEOs more than the IRS and the CEOs owe roughly whatever they want.

A tax deal only the ultra-rich could love (WaPo)

Harold Meyerson notes that despite the furor over raising the top tax rate on wages and salaries, the wealthiest Americans are only dimly aware of wages as the cut their household staff takes from their investment dividends, which are still taxed at a lower rate.

Tax Increases and Bull Markets (NYT)

Bruce Bartlett points out that while the GOP takes it as given that any tax increase will cause the invisible hand of the free market to ball up into a mighty fist and smite the unbelievers, historical evidence shows that raising taxes often leads to a stock market rally.

The payroll tax hike wiped out a year's worth of wage gains (WaPo)

Brad Plumer writes that after rising 2.4 percent in 2012, average weekly earnings are back at square one -- or worse -- thanks to the expiration of the payroll tax cut. And as tends to happen, Americans are planning to spend less of that money they no longer have.

Social Issues Are Economic Issues, Exhibit 1,463: Michigan's Dual Agenda Slams Low-Income Women (The Nation)

NND Editor Bryce Covert notes that the right-to-work law and abortion restrictions recently passed in Michigan may look like bad but unrelated policies, but based on how they'll affect women's wallets, it's possible to construct a Unified Theory of Awfulness.

TARP is Over, But the Bailouts Will Continue Until the Big Banks are Broken Up (Robert Reich)

With the Treasury Department preparing to sell off its final shares of banks and General Motors, the '08 bailouts are almost behind us. But Robert Reich warns that unless Wall Street is cut down to size, the injured giant we've propped up will fall back on top of us.

Foreclosure Review in New Settlement Leaves Homeowners in Banks' Hands (HuffPo)

Eleazar David Melendez and Ben Hallman note that regulators have answered complaints that the independent review process was flawed by letting the banks review their own foreclosure decisions. Early reports suggest they couldn't agree with themselves more.

Health Care and Profits, a Poor Mix (NYT)

Eduardo Porter argues that America's rising health costs, driven by the profit-maximizing private health care industry, should encourage us to reconsider whether relying on the private sector to provide so many of our public goods is the remedy or the sickness.

Avoiding a climate-change apocalypse (WaPo)

Katrina vanden Heuvel writes that 2012 exposed us to many different end-of-world scenarios, but Hurricane Sandy should be the one that sticks with us. Sadly, it's been a challenge to get the GOP to pay for the consequences of climate change, let alone prevent it.

After the Debt-Ceiling Breach: What Day 1 in Default America Might Look Like (The Atlantic)

Derek Thompson notes that while America could default on its debts just a few weeks from now, it's so unthinkable that it's hard to imagine the consequences. But even though it's scheduled to happen around Valentine's Day, they're likely to be pretty unlovely.

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Daily Digest - January 8: Learning to Love the Platinum Coin

Jan 8, 2013Tim Price

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The Post-Crisis Crises (Project Syndicate)

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The Post-Crisis Crises (Project Syndicate)

Roosevelt Institute Chief Economist Joseph Stiglitz argues that policymakers shouldn't let short-term conflicts like the fiscal cliff distract them from long-term problems like adapting to climate change. They'll regret wasting their breath when everything's underwater.

Calling McConnell's Bluff (Prospect)

Robert Kuttner writes that while Republicans are talking a good game about the upcoming debt ceiling battle and the possibility of a government shutdown, there's no reason for President Obama to fold this hand when he's got the Fourteenth Amendment card to play.

Be Ready to Mint That Coin (NYT)

Assuming that the Constitution alone can't make the GOP back down, Paul Krugman thinks the White House should exploit the loophole that allows it to mint a $1 trillion platinum coin. Or in the words of George Costanza, "You wanna get nuts? Come on, let's get nuts!"

Why Platinum Coin Opponents Are All Wrong (Bloomberg)

If you think the platinum coin idea seems a little... weird, like an Internet meme that escaped into the wild and went feral, Josh Barro provides four counter-arguments. After all, what sounds more insane: paying our debts with novelty coins, or defaulting for no reason?

Democrats signal intention to tackle the 'submerged state' (MSNBC)

Ned Resnikoff notes that Democrats are targeting tax credits and deductions that benefit the rich and make up part of what Suzanne Mettler calls "the submerged state" -- the kind of aid that the government disguises like it's trying to trick its dog into swallowing a pill.

The Cliff Game (NYT)

Nancy Folbre writes that Washington's budget battles have turned into a high-stakes game of chicken between the two major political parties, but the Democrats have more incentive to swerve in order to avoid leaving tire tracks on the backs of their constituents.

We don't have a spending problem, we have a military spending problem (WaPo)

Ezra Klein argues that if Republicans like Paul Ryan want to be taken seriously when they complain about excessive government spending, they need to admit America won't exactly be fighting blindfolded with Nerf bats if we trim down the $530 billion defense budget.

Women on Corporate Boards Bring More Aggressive Action (Forbes)

NND Editor Bryce Covert highlights a report that shows the presence of women doesn't cause corporate boards to spend more time crocheting and talking about Downton Abbey. They tend to focus on other things, like making sure the company is actually run well.

Inside the Radical Plan to Fight Foreclosures With Eminent Domain (MoJo)

Josh Harkinson talks to Steven Gluckstern, who advocates using cities' power of eminent domain to seize loans from lenders and help prevent foreclosures. Critics find his motives suspect, unlike the very straightforward desire of banks to throw people out on the street.

Rescued by a Bailout, A.I.G. May Sue Its Savior (NYT)

Ben Protess and Michael De La Merced report that after launching its "Thank you America" ad campaign, AIG may express the depths of its gratitude by joining a shareholder lawsuit alleging that the terms of the bailout were too harsh. Really? The building's still standing.

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