All the sins of Larry Summers that justified his comeuppance

Since yesterday, when Larry Summers announced that he is taking his name out of consideration for the Chairman of the Federal Reserve, I have received two emails from old friends.  Hey, Judy, what do you think of that?  (As if they didn't know!)
Let us not cry for Larry and his lost dream.  He will have to satisfy himself in his comfy office at Harvard, and at whatever hedge fund he's hanging out at these days.  The man will not starve, though a little bit of fasting might not hurt him.
Still, it is time for me to lay out ALL of his sins, and to wonder why President Obama would ever have thought he would be acceptable to his (Obama's) base.  Most of these you will know about.  One, however, was embedded deep in one of Summers' op-ed pieces in the Washington Post over the past year.  It's the most cardinal sin of all.

Recap:  The frequently mentioned sins:  

1.  Responsible for the Financial Crisis:  He and his mentor (Bob Rubin) disparaged Brooksley Born, of CPSC, back in the 1990's, when she tried to get the Clinton Administration to do something about  the danger of unregulated derivative markets.  Those two, along with Alan Greenspan, snickered at little Brooksley who, as female, could not possibly understand the workings of big finance.  Eventually, to ensure their point of view, the four horsemen (Rubin, Greenspan, Summers and Gramm)  shepherded the Commodities Futures Modernization Act of 2000 through Congress near Christmas 2000.  Did Clinton even know what he had signed?  Well, not his greatest hour, but he listened to his advisors.  His advisor, our boy Summers, was not only wrong on the issue, he was arrogant about opposing views.   Unlike Alan Greenspan, he has never apologized for his role in the fiasco.

2.  Harvard Remarks on Women:  After alienating the faculty (let's forgive that), he made some remarks about women and math, which were probably inadvertent but which reflected an unscientific mindset and a clear bias against women.  He was pointing out the achievement gap in higher math between men and women. That's simple fact.  He argued for more research on the causes of same.  That's good.  But, then, he couldn't stop.  He said his "hunch" was that the cause of the gender gap is genetic and not environmental.  Ah, Larry. There it is.  No evidence, but your null hypothesis (needing to be disproven) was genetic male superiority!  Done as President of Harvard.  Yea!

3.  Performance in the White House during the Obama years.  Divisive, dithering, turf-conscious.  Ron Susskind's book, "Confidence Men" laid it all out.  I needn't say more.  Here is the New York Times article that describes Summers and what everyone (except the President, apparently) thought about him.  I will say no more as this item makes me wonder about my own crush on President Obama.  I don't want to go there.

The Mortal Sin:  (not mentioned in any of the news articles)

1.   The man supports the building of the Keystone Pipeline.  Why, he's such a genius that he knows about energy policy and global warming even better than the vast majority of climate scientists,   When I read his Washington Post Column (on economic growth) in which he put forth his argument, I felt obliged to write an angry letter to the Post editor asking why they print this man's drivel after his performance in numbers 1, 2, and 3 above. (I thought I was being clever, but my screed was not published.)  I have just spent a half hour looking for that opinion piece in the Post and could not find it.  But here it is, reprinted in a Reuters-India paper.

RIP, Public Servant Summers!  Enjoy retirement advising the hedge fund managers.

Charts on Long-Term Trends in Foreign-Born US Population

CBO has some great charts from the US Census that show how the immigrant population has changed over the last 100 years and, even better, how the educational attainment of said foreign-born individuals compares to native-born US citizens.  The big surprise to me is how well people from South America and the Caribbean do education-wise compared with those born here.  Why is that?  Haven't a clue.   But, perhaps it has something to do with another CBO chart that shows the comparatively high number of people from Mexico and Central America who are in the USA in an "unauthorized" status.

SCOTUS OPINION on Obamacare- Read it here!

Here is the C-span link to the Supreme Court opinion on the ACA.
Who would have thought that logic (i.e., a mandate that is enforced as a tax is a tax! and Medicaid is a voluntary program, that States can opt out of in pieces) would prevail?

Is this another switch in time that saved nine?  Or the opposite?  Only time will tell.  My relief tells me exactly where my own opinions lie.

What's the best outcome of SCOTUS on Obamacare?

Here we are, on the possible eve of the supreme court's decision on the constitutionality of the Affordable Care Act (ACA).  I've been grappling with what I want to see as the outcome, from the standpoint of what's good for the health care system, what's good for Obama's reelection, for the Democrats in Congress, and finally, for the crowd of  people who deeply believe that a single-payer health care system (a la Medicare) is best for the entire country.  To clarify, when I think about what's good for the health care system, I have in mind the ultimate effects on cost, quality and equality of access...those three competing objectives of public policies governing the delivery of health care.
What's good for Obama's re-election?  I believe the best thing for Obama politically speaking  is to have the whole bill nullified (except for the Medicare provisions, which nobody is talking about anyway).  That would wipe out the state-level exchanges, the insurance mandate (of course), and all the Medicaid provisions that expand access to Medicaid to all individuals and families with incomes less than 133% of the Federal poverty line (about $14K for individuals;  and $31K for a family of four).  I can't imagine how striking down the insurance mandate could leave in tact the ban on insurers discriminating on the basis of pre-existing conditions, or even the requirement to cover the under-26 crowd (even though some major insurers say they will keep that one.)
I think it would be good for voters to go back to square zero on health care.  It would take the fire out of the conservatives' righteously(?) indignant bellies over the mandate, while leaving the rest of the country to mull the alternatives.
What's good for the Democrats in Congress?  Re-election wise, see above.  Ideologically wise?  What ideology?  Dollars (theirs)  is what matters to them.
What's good for the Single-payer ideologues?  This is a no-brainer.  The mandate goes, the Medicaid provisions stay.  Most Americans do not realize that the Medicaid provisions, in addition to expanding eligibility, require Medicaid to pay for physician services at Medicare rates..  We hear a lot about how Medicare fees are low compared with private rates, but Medicaid fees are 30% lower than that!  And, to top it all off, the Federal government will pick up the entire tab for the health care costs of the new eligibles.  (Yes, yes, that's for 2 years, after which the Federal % drops to 90% and the Medicaid fee schedule rule drops, but who believes that the doctors won't have the clout to extend the fee schedule, just as they have managed to keep fees from plunging under Medicare's law by one-year extensions?)
Bottom line:  an extension of the Medicare-like single-payer system to a greater part of the population, and a gradual acclimation of the public to the idea that universal coverage can only come from a single-payer system.
What's good for the Health Care System?   At this point, I am rooting for a complete nullification, though  I am aware it's a long-shot.  That's because I don't believe in a single-payer system. So, what I mean is that if the mandate is going to be shot down, then I hope they shoot down Medicaid, too. That way, in having to start from scratch, perhaps Congress will put all the people into exchanges, which will treat the lower-income folks with the same respect they treat others. And, instead of  "exchanges," it should be "exchange."   I believe in a regulated market place (much like the Federal Employees Health care system) that offers competing plans meeting minimum coverage requirements.  The exchanges sounded like a good idea, but they are implemented at the state level, which doesn't allow much ability to pool risks, especially in smaller states.  (The state-level exchanges came from the Senate and its nefarious (Demorcatic) leadership, while the (Democratic) House bill had a national exchange system that would have guaranteed a large pool of enrollees.)
At this point, it would be worthwhile to go back to ground zero and let the nefarious Republican leadership deal with the consequences of its political intransigence and the public with another failure of our country to make access to health insurance (and therefore decent access to health care) a right.
What do you think?

The newest Republican Front-Runner

I just had to post this to get some relief from the idea of Newt Gingrich as the Republican nominee.  The Borowitz Report had the scoop.

The state of the global economy, by Joseph Stiglitz

Much has been made of his nobel prize in Economics, but let's face it...there are now a lot of those running around.  Nevertheless, I always find his papers and remarks understandable, which is a big thing in my view.
Here he has a sort of radical idea for saving the world economy, and he also puts the "state of" in an excellent perspective.
Here it is:  Stiglitz World Bank Talk

Find your Congressman on Twitter

Here is the list of Twitter Addresses for members of the House of Representatives.

If you use Twitter, it might be a good way to send your opinions in.  Short and sweet.

Dems help keep low tax rates on wealthy.

We expected it of the Republicans, but this Washington Post Article reviews the voting patterns of many Democratic legislators (and President!) who created and protect the very very low (now 15%) capital gains tax.  Only the wealthy have substantial capital gains that are not sequestered in tax-deferred or tax-free IRAs or 401-Ks.  It takes a wealthy person to benefit from the low capital gains tax.  If we need to raise revenue, we should start there.

Imagine the USA without regulators of gas pipelines.

When your TeaParty friend starts up again this fall, calling for deep federal discretionary spending cuts, here's a great example to (figuratively) shove in her face of an industrial regulation that we may not be able to live without.
This gas pipeline example involves faulty welds holding together the Millenium Pipeline Company's line through the southern tier of New York State.  Cities I know well -- Spencer, Oswego to name two --are in the pipeline's path. For a map of the track of the pipeline through New York's southern tier, see NaturalGasWatch.org. 
ProPublica has a good article on how bad the situation with the pipeline is.  If you know people who live in the southern tier of NY State, pass this information on. 
We should start a catalogue of federal government "discretionary" programs that are endangered by steep budget cuts.  I betcha our teaparty friends would say, well, of course not THIS program, but the other, wasteful, programs are the ones that need to go.  Or, maybe they would say this is just an outlier situation that the company will handle on its own quite nicely.  (I wish the company had addressed the issue somewhere in its web site. I would sleep better at night on behalf of my friends in  Oswego and Spencer if I thought the company was taking safety issues seriously enough to inform the public.)
We middle-of-the-roaders should start to catalogue federal discretionary programs, especially regulatory ones, that are worth their costs beyond a shadow of a doubt.  And, ask our teaparty friends to start listing the specific programs or regulations that are not worth their costs.  Let's see what we all come up with.

The budget deal will include a hidden Social Security benefit decrease

[Update Note 8-3-2011:  This provision was not included in the Budget Agreement of 8-1-2011.  It may come up again in the further cuts implied by the agreement.]

I'm not against the benefit decrease that I'm about to explain.  It's relatively minor.  But, it's emblematic of the snookering job our pols give  us through legislative deals that are too arcane for us to understand.   When the Pols tell you they haven't touched Social Security or government pensions with the deal now in the making, you can say, "sure, buddy,...just keep passin' the kool-aid so's I can drink."
My trip to Wegmans yesterday to buy raw frozen shrimp for a casserole will explain all, if you stay through the arcania of the next paragraph or so. 
In a nutshell, the budget deal will change the basis for the annual COLA update from the current Consumer price index (CPI) to a Chained Consumer Price Index (C-CPI).  I've heard several experts, including democratic pundits (see NPR program),  say that this is a "more accurate" way of measuring the update than is the standard CPI.  I say "Hooey".
The government calculates the CPI each month by using a careful sample of a defined "market basket" of goods and services that consumers buy to keep themselves going. This market basket is set every 5 years or so.  It includes our purchases, ranging from toothpaste and broccoli to automobiles and housing.  The price of each component in the market basket is measured each month, and the overall CPI index value is based on the price today as a ratio of the price in a base year (say 1983) for each item.  Every item in the sample is weighted by its percentage of spending in a "weighting year," which is different from the base year.  Though the weighting years change from time to time, years can go by before new products are added into the market basket and new weights are calculated.
The weighted average in a particular base year (say, 1983)  is given an index value of 100, and today's value is calculated as the current weighted average of prices divided by the weighted average of prices on that base date.  The CPI for 2010 was 218 (compared with 100 in 1983).  That means that prices more than doubled in the 28 years from 1983 to 2010.  (See The Economic Report of the President 2010 for a table of CPI over the years.)
The chained CPI plays with the weights in a way that lowers the measured CPI.   Here's how.  Whereas the regular CPI uses  weights for some prior year -- say, 5 years ago -- which reflect the choices consumers made among all these items back then, the C-CPI keeps changing the weights to reflect the current distribution of expenditures across items.  So... let's say that the price of one item goes up radically while the prices of all other items increase only slightly.  What usually happens is that people stop buying so much of that item and its weight in the index declines while others go up.  Best example is steak vs hot dogs.  Let's say the price of beef is going up faster than other things  (due to all those Chinese rich people who suddenly want to get fat on steaks).  Now, instead of our tasty filets every Saturday night, we have a nice hot dog with kraut and ketchup.  We aren't thrilled, but we adjusted, right?  And we lived within our budget.  Our quality of life has gone down, at least by a smidgen.  And lots of us do this, so that the value of steaks in our market basket today is now lower than it was last month.  So, the government "rewards" us by reducing the weight placed on the price increases for steaks and increasing the weight on all other items, including hot dogs, which haven't increased so much.
One expert, Dean Baker, says that this switch to the chained CPI will likely reduce social security and other pension benefits with COLAs (e.g., federal employees) by about 0.3% a year, or roughly 3% over 10 years.  That's not very much, and it's the result of our resilience as Americans in learning to cope with adversity.  But, IT IS A REDUCTION IN BENEFITS!  So, don't let anyone -- Dem or Republican or TeaParty -- tell you that you haven't already given. 
Now to Wegmans and my shrimp.  I have a very good recipe for Sullivan Island Shrimp, which needs a pound of raw shrimp.  So, I went to Wegmans, found a bag of frozen raw shrimp, couldn't find the price, and finally with help learned that 2 pounds would cost me 29 bucks.  I couldn't believe it.  Rechecked.  Sure enough.  Well, just six months ago, I could get 2 pounds for about 16 bucks.  After much back and forth -- I put it in my cart twice before finally putting it back -- I decided that the nice chicken pot pie in my freezer would do just fine.  "Wow!," I thought.  "I've reached that point -- can't (or don't want to) afford my signature shrimp dish.  Oh, well, I'm coping."  And, of course, I'm helping the government reduce my social security payment in the coming year.

My prediction for 2012 Republican Presidential Ticket

One of the joys of having this little personal blog is that I can indulge my favorite hobby-- to be able to say "I said that this would happen."  This post is to go on record with my prognostication for the republican ticket in 2012.  That way I can say, "See?.."
or, more likely, "Well, I don't  know diddly about politics, and never said I did."  (That latter statement is true.)
Here goes:
Republican Nominee for President, 2012, Mitch Daniels, Governor of Indiana
Republican Nominee for Vice-President, 2012, Marc Rubio, newly elected Senator from Florida.
This prediction should in no way be considered an endorsement of the above.  I'm just having fun with my told-you-so hobby.  You, dear reader, may have been a recipient of such statements in the past regarding all manner of things, and you know that I live for the times when you say something to me like,  "Do you remember way back in 2007, Judy when you told me to sell my house now rather than to wait for the price to improve?"  Well, you were right!
Now, if you REALLY want to have fun with me, why don't you counter --in the comments -- with your own predictions.  And then we can compare our prescience in September 2012 (God willing).