Wonkbook: Obamacare’s troubles threaten Obama’s core political project

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(Photo by Charles Dharapak/AP)

(Photo by Charles Dharapak/AP)

"Our IT systems, how we purchase technology in the federal government is cumbersome, complicated and outdated," President Obama said in a frank and searching press conference on Thursday. "On my campaign, I could simply say, who are the best folks out there, let's get them around a table, let's figure out what we're doing and we're just going to continue to improve it and refine it and work on our goals."

"When I do some Monday morning quarterbacking on myself, one of the things that I do recognize is since I know that the federal government has not been good at this stuff in the past, two years ago as we were thinking about this, you know, we might have done more to make sure that we were breaking the mold on how we were going to be setting this up. But that doesn't help us now."

Obama's frustration runs deep. At this point, he realizes that HealthCare.gov's problems don't just threaten his poll numbers. They threaten his core political project.

Like many Democrats of his generation, Obama believes that the government is necessary — but that the government must be redeemed if it's to be trusted. He thinks the American people are rightly suspicious that the government doesn't do big things well. He venerates the market's capacity for innovation and efficiency even as he struggles against its ruthlessness and cruelty. And he ran for office convinced that if the American political system was going to be able to address the country's problems going forward, it would require an end to the old ideological battles and the forging of a new policy consensus.

The Affordable Care Act is the purest incarnation of these theories. It's meant to protect Americans from the predations of both the job market and the health-insurance market by making sure the poorest Americans can afford coverage, the sickest Americans can't be denied it and no one is tricked into plans that prove inadequate when health crises strike.

But it's also meant to avoid the pitfalls — both substantive and political — of big-government programs by relying on private insurers competing in tightly regulated, highly transparent, government-structured marketplaces. That's why Obama modeled the plan off of Mitt Romney's largely successful health reforms in Massachusetts. What better way to absorb Republican ideas and generate Republican buy-in then to adopt an idea from one of the GOP's leading lights?

Obamacare's success would've affirmed the theories underlying Obama's presidency — theories that could then be picked up by future presidents. Instead, Obamacare is systematically blowing apart the very premises it's based on.

The reliance on Republican policy proposals did nothing to generate Republican support. Instead of showing the falseness of partisan divisions, Obamacare has proven how deeply entrenched they truly are.

Far from introducing innovation and efficiency into the system, the decision to build a complex, 50-state public-private hybrid has introduced towering complexity into the project, and seems, potentially, to be beyond the government's capacity to do well.

And protecting individuals from the predations of the market has mostly led to complaints from those benefitting from the predations of the market. Even the most unjust system has winners, and those winners cling tightly to what they've won.

It remains likely that Obamacare will recover. In February of 2006 — so, at about this point in the implementation of Medicare Part D — then-House Majority Leader John Boehner was calling the program's roll-out "horrendous." But the problems were eventually worked out, and today, it's a popular, successful program.

But first impressions matter. The roll-out of Obamacare was the Obama administration's best shot to create a model for policymakers going forward. But so far, it's reinforced the old partisan divisions, affirmed the widespread impression that government is too cumbersome and inefficient to do big things well, and made clear that economic insecurity can be an impediment to improving the safety net because people are so afraid of losing what little protection they have.

It is not, in other words, going as the president hoped.

Wonkbook's Number of the Day: 1,231 and 1,451. Those are, respectively, the number of hospitals that received an increase and a cut in their Medicare payment rate in the second year of a program that will tie reimbursement to quality of care. Read down in the first story for more healthcare policy beyond Obamacare's current fight. 

Wonkbook's Graph of the Day: Cool Yellen graphs on economic history.

Wonkbook's Top 5 Stories: (1) Obamacare's cancelled plans; (2) Yellen headed for confirmation to Fed; (3) bye bye, coal; (4) the NSA just told us we haven't found everything yet; and (5) Google's day in court.

1. Top story: Obamacare's troubles threaten Obama's core political project

Obama announces change to address health insurance cancellations. "President Obama relented to pressure from the public and his own party Thursday and changed one of the bedrock requirements of the new health-care law to fulfill his promise to allow people to keep their insurance plans if they want...The president made the change at a White House news conference that quickly turned from a specific policy announcement into a nearly hour-long deconstruction of broader flaws with the health-care law and Obama’s responsibility for its early failures...Obama said insurance companies could continue for another year to offer health plans sold to individuals and small businesses that do not meet requirements under the new law that set minimum standards for the benefits that policies must cover." Juliet Eilperin, Amy Goldstein and Lena H. Sun in The Washington Post.

Full transcript: President Obama’s Nov. 14 news conference on the Affordable Care ActThe Washington Post.

Transcript: White House background briefing on plan to allow insurers to continue offering canceled plansThe Washington Post.

Healthcare.gov's problems will last into December, Obama says. "“It’s fair to say that the improvement will be marked and noticeable,” President Obama said, adding that “the Web site will work much better than it did” Oct. 1. “On November 30th, it will be a lot better. But there will still be some problems,” he added." Juliet Eilperin in The Washington Post.

This is how Obama plans to un-cancel insurance policies. "I hear that the president just changed Obamacare. Give me the simplest possible explanation of what happened. The White House is giving health insurance plans the option to keep selling plans that don't comply with the Obamacare for one more year. How does that change the law? Prior to this morning, any insurance plan offered after Jan. 1, 2014, had to comply with new Obamacare requirements." Sarah Kliff in The Washington Post.

The White House’s Obamacare fix is about to create a big mess. "Under the change that the administration is announcing this morning, the hypothetical Americans with a policy that ends in June 2014 would have the option to renew that same plan for one more year, if their insurance company decides to provide that option. Keep in mind, this change is not ordering insurers to offer their products for another year; health plans regularly take their offerings on and off the market. Instead, it's a very nice ask on the part of the administration, to insurance carriers and regulators, to play ball on this one...For insurance regulators and health insurance carriers, though, this supposed glide path is about to create a whole bunch of headaches. They have been expecting, for years now, that these insurance plans would be phased out of the market in 2014 — and have planned accordingly." Sarah Kliff in The Washington Post.

Insurers are furious about the White House’s new Obamacare plan. "This is a statement that Karen Ignagni, president of America's Health Insurance Plans, just put out: “Changing the rules after health plans have already met the requirements of the law could destabilize the market and result in higher premiums for consumers.  Premiums have already been set for next year based on an assumption of when consumers will be transitioning to the new marketplace.  If now fewer younger and healthier people choose to purchase coverage in the exchange, premiums will increase and there will be fewer choices for consumers.  Additional steps must be taken to stabilize the marketplace and mitigate the adverse impact on consumers.”" Sarah Kliff in The Washington Post.

The backlash to the Obamacare fix has already started. "It took about three hours exactly for states to start pushing back against President Obama's request that regulators allow insurance plans to offer current products in 2014. Washington state insurance commissioner Mike Kreidler has announced that he will not allow insurance companies to do so...It does feel a bit weird to have one of the most liberal regulators be the first out of the gate to oppose Obama. At the same time, it also makes sense: What Kreidler is doing is a full-throated defense of the Affordable Care Act." Sarah Kliff in The Washington Post.

Boehner, Pelosi say legislative fix needed for Obamacare. "Speaking minutes before Obama’s announcement on his Obamacare fix, House Speaker John A. Boehner (R-Ohio) suggested that the administration would not be able to correct the issue without legislative action. And his counterpart, House Minority Leader Nancy Pelosi (D-Calif.), suggested Congress should act as well." Aaron Blake and Paul Kane in The Washington Post.

Despite Obama’s plan, Landrieu will keep working on legislative fix. "Sen. Mary Landrieu (D-La.) says she's pushing forward with her bill, despite President Obama's announcement. In a statement after Obama's remarks, Landrieu said that she will continue to work on legislation to allow people to keep their insurance plans, even after Obama said he will look to fix the problem administratively." Aaron Blake in The Washington Post.

The Landrieu and Upton fixes. "The Republican Party's play is Fred Upton's "Keep Your Health Plan Act." The law is poorly named: It doesn't actually guarantee that you can keep your health care. Instead, it allows insurers to keep offering their current plans and also allows them to offer new plans that aren't ACA compliant...The bill gives insurers the option of renewing their cancelled plans — but, crucially, it doesn't require them to do so. Few insurers want to renew those plans, as they don't expect them to be profitable in a post-Obamacare world. So Upton's bill doesn't mean people can keep their current health insurance, but it means they can begin (wrongly) blaming their health insurer rather than the Obama administration for the cancellation of that insurance." Ezra Klein in The Washington Post.

White House threatens veto of Upton bill. "The White House issued a formal veto threat Thursday night of a bill offered by House Republicans that would allow insurance companies to continue offering health plans that existed before the beginning of the new year." Justin Sink in The Hill.

The reality of this mess is that Democrats could lose a considerable number of seats in moderate districts. "Up for re-election in 2014, and with her poll numbers tumbling, Mrs. Hagan has emerged as a leader of the Democratic caucus openly criticizing the botched rollout of the Affordable Care Act...Many of the vocally critical Democrats are up for re-election next year, including Louisiana Sen. Mary Landrieu." Patrick O'Connor and Valerie Bauerlein in The Wall Street Journal.

Their loyalty is being tested. "As the president finished answering questions, the White House’s full-court press continued on Capitol Hill. Denis McDon­ough, Obama’s chief of staff, led several senior officials into nearly four hours of meetings. First, they ducked in with the 55-member Senate Democratic caucus. They tried to calm the group and pleaded for time to try to repair the damage without any legislative interference, pledging to fix the federal Web site that opened to disastrous reviews on Oct. 1. McDonough and his group then darted across the Capitol and down into a basement room where nearly 200 House Democrats had assembled, delivering the same message." Paul Kane and Jackie Kucinich in The Washington Post.

But, at some level, trust has frayed. "When Denis McDonough stepped onto House Democrats’ turf on Thursday, he was armed only with a PowerPoint presentation on fixing Obamacare’s website and talking points about the president’s proposal allowing people to keep their health care plans. The White House chief of staff might have been better off revealing a U.S. map with the president’s plan for saving congressional Democrats’ seats — or just apologizing for letting so many Democrats walk out in public and repeat wildly inaccurate White House claims about the health of the enrollment website and Americans’ ability to keep their insurance plans if they liked them." Jonathan Allen and Jake Sherman in Politico.

For Obama, the last campaign may be the most difficult. "The disastrous rollout of his health-care law has put him on the spot in ways he has rarely been before. The cool and cerebral chief executive, whose reliance on smart people and rational analysis has been at the foundation of his often-insulated governing style, has been forced to admit that he and his team vastly underestimated the challenge of implementing the Affordable Care Act." Dan Balz in The Washington Post.

We still don’t know the most important Obamacare enrollment number. "[T]here's one key number that's missing, a figure we absolutely need to understand whether the health care law can succeed. And that's the ratio of young enrollees to  older enrollees...What's important here isn't necessarily the numbers but the ratio -- that for every three older people who sign up, the administration believes it needs to persuade two young people to obtain coverage. Right now, we don't know how close the White House is getting to that ratio." Sarah Kliff in The Washington Post.

Feds issue health insurance test framework. "The Department of Health and Human Services (HHS) on Thursday unveiled a regulatory notice outlining the measures that insurance companies would need to collect and report about plans offered through new insurance marketplaces. Under the Affordable Care Act, HHS is required to develop systems to rate insurance plans on those marketplaces, called exchanges, based on relative quality and price. It is also supposed to develop a system to survey enrollee satisfaction." Julian Hattem in The Hill.

Nearly 1,500 hospitals penalized under Medicare quality program. "More hospitals are receiving penalties than bonuses in the second year of Medicare’s quality incentive program, and the average penalty is steeper than it was last year, government records show. Medicare has raised payment rates to 1,231 hospitals based on two-dozen quality measurements, including surveys of patient satisfaction and—for the first time—death rates. Another 1,451 hospitals are being paid less for each Medicare patient they treat." Jordan Rau in Kaiser Health News.

California shuts down Obamacare scammers. "The California attorney general’s office has shut down 10 websites that mimicked state’s official health insurance marketplace, the attorney general, Kamala Harris, announced Wednesday...The sites all used domain names similar to coveredca.com, including coveredcalifornia.com and californiabenefitexchange.com, and they used phrases like “Get Covered” and “Covered California” to attract consumers, according to the attorney general’s office. However, the sites were operated by private health insurance brokers not affiliated with the state’s official exchange." Ian Lovett in The New York Times.

It's George W. Bush comparison hour for the Obama administration. "The disastrous rollout of his health care law not only threatens the rest of his agenda but also raises questions about his competence in the same way that the Bush administration’s botched response to Hurricane Katrina undermined any semblance of Republican efficiency." Michael D. Shear in The New York Times.

THE WASHINGTON POST: A troubling 'fix.' "Mr. Obama’s big announcement Thursday, though, was a “fix” to the Affordable Care Act meant to redeem his promise that “if you like your health-care plan, you can keep it.” Unfortunately, it was his promise that was wrong, not the design of the law. At best, his proposed fix will have little impact except to let him shift the blame; at worst, it will undermine reform" The Washington Post Editorial Board.

THE WALL STREET JOURNAL: Trust the Democrats to know when to run. "If only the new "administrative fix" he announced on Thursday did more to help the consumers who are losing their coverage than it does to help Democrats protect their political future...The insurers are essentially being asked to agree to accept losses on behalf of a rump group of policy holders in a legacy business that would then turn into a pumpkin in 2015...His faux reprieve will now let Democrats shift the blame for cancellations to insurance companies, though all they have been doing is following the Administration's orders." The Wall Street Journal Editorial Board.

THE NEW YORK TIMES: What a mess. "If a relatively small population of people get extensions, as some experts think likely, the effect on premiums in the overall health insurance market may be minimal. Even so, this disturbing reversal is caused by the incompetence of the administration in ushering in reforms that millions have been waiting for." The New York Times Editorial Board.

BLOOMBERG VIEW: Dumb and dumber. "President Barack Obama is trying to make up for an exceedingly dumb promise with a moderately dumb compromise. For many people who have lost their old insurance policies, his offer may be no help at all...The trouble with that compromise is that while Obama’s earlier argument may have been tone-deaf, it was also accurate. If it was bad policy a month ago to let insurers skimp on some essential benefits, such as maternity care or mental health care, it’s still bad policy today. If it was bad policy then to let insurers keep healthy young people away from exchange-based risk pools by selling them low-cost, low-coverage plans, it’s still true now." Bloomberg View Editorial Board.

WEIGEL: If you like your panic, you can keep your panic. "Watching Congress panic and scramble for a way to restore individual insurance plans shredded by Obamacare is like watching otherwise intelligent people try to mend a broken sink with a flamethrower. The current mania, which will peak when White House spinners hold lunch today with Senate Democrats, consists of legislators trying to grandfather in some of the millions of plans that have been canceled. If they asked insurers, they’d quickly figure out why, for most people, that won’t work." David Weigel in Slate.

PONNURU: The latest Obamacare fix only makes things worse. "f state regulators allow the plans to be reissued and insurers agree to go along, one of the law’s chief problems will get worse. Experts on both sides of the debate have long understood that the program was vulnerable to “adverse selection.”...[T]he Affordable Care Act also reduces the incentive for healthy people to buy insurance. It lets people who get sick buy insurance on the same terms as healthy people; they just have to wait for an open-enrollment period. If the healthy opt out, the pool will consist disproportionately of the sick, and premiums will be high. That means those who don’t qualify for Obamacare’s subsidies will be even less likely to buy insurance, and the subsidies for those who do will be larger." Ramesh Ponnuru in Bloomberg.

COHN: How to understand the tweaks. "HHS says it will "explore ways to modify the risk corridor program final rules to provide additional assistance." What might that mean? One possibility would be allowing insurers to get extra money if they incur extra losses because of this change. In effect, risk corridors are an insurance policy for the insurers—and, ultimately, the people who pay their premiums. The administration is signalling it will strengthen that policy, if necessary." Jonathan Cohn in The New Republic.

DRUM: No fix will get through Congress. "Republicans are interested only in Obamacare's failure and will refuse to support any Democratic bill that genuinely addresses the problem. Conversely, Democrats are interested only in improving Obamacare and relieving the political pressure they're feeling. They will refuse to support any Republican bill that contains an obvious poison pill. Unless I'm missing something, the intersection of these two positions is the null set. Thus, there is no bill that can pass Congress." Kevin Drum in Mother Jones.

JUDIS: The launch that hurt liberalism. "It has taken panics, depressions, wars and social upheaval to get Congress to adopt social and economic reforms. At all other times, the publics’ distrust of government, as reinforced by business, has carried the day. Bill Clinton discovered that out in his first term when he tried to pass a national healthcare program. Obama succeeded in passing a health care bill in 2010 in the wake of the Great Recession. But if Obamacare doesn’t work as promised, then its failure will have reinforced for a generation the argument against any government initiatives. Reform will be dead – whether it’s to fix immigration, healthcare, or the growing gap between rich and poor." John B. Judis in The New Republic.

Music recommendations interlude: Billy Joel, "Summer, Highland Falls."

Top opinion

LEITNER AND SHAPIRO: Consols could avert another U.S. debt crisis. "Consols issued by the U.S. Treasury would not fall within the scope of the debt ceiling because there is no principal that is an obligation of the U.S. Treasury. If no principal ever comes due, there is no addition to the U.S. debt as defined by the debt-limit legislation. The Treasury should announce a pilot program to issue consols. This would involve determining the size of the potential market at different rates of return so that officials would know what the offering should be if Republicans threaten another debt-ceiling crisis." James Leitner and Ian Shapiro in The Washington Post.

KRUGMAN: The money trap. "What’s scary here is the way this is turning into the Teutons versus the Latins, with the euro — which was supposed to bring Europe together — pulling it apart instead...Germans just hate inflation, but if the E.C.B. succeeds in getting average European inflation back up to around 2 percent, it will push inflation in Germany — which is booming even as other European nations suffer Depression-like levels of unemployment — substantially higher than that, maybe to 3 percent or more. This may sound bad, but it’s how the euro is supposed to work. In fact, it’s the way it has to work. If you’re going to share a currency with other countries, sometimes you’re going to have above-average inflation." Paul Krugman in The New York Times.

COWEN: The robots are here. "[I]ncome inequality both in New York City and the United States has risen significantly since the 1980s, accompanied by a more tolerant, more open and more sedate America. It seems that, whether we like it or not, increasing inequality and growing democratic peace are compatible. Americans will also become more politically conservative, as the digital winners seize control of the narrative and the rest of the country grows more enamored of low or falling taxes, whether or not such tax rates prove possible to maintain." Tyler Cowen in Politico.

Ok this is the best thing ever interlude: When people were trapped inside Ikea demonstration sets.

2. Yellen steams toward Fed post

Janet Yellen says the Fed has financial regulation on the right course. "Janet Yellen appeared before the Senate banking committee Thursday for a hearing on her confirmation. Many of lawmakers’ questions focused on what the Fed has done to shore up the banking sector and central bank’s progress in crafting new regulations required under sweeping reforms passed by Congress three years ago. They also challenged Yellen to address ways to limit the dominance of the nation’s largest financial institutions, which have been dubbed “too big to fail.”" Ylan Q. Mui in The Washington Post.

Liveblog: Janet Yellen faced the Senate today. Here’s everything you need to knowNeil Irwin in The Washington Post.

It's pretty clear that Yellen will be confirmed safely. "Democrats and Republicans on the Senate Banking Committee treated Ms. Yellen as if she were already the Fed’s chairwoman, skipping over questions about her qualifications and instead venting broad frustrations about the slow pace of economic growth... The office of Senator Tim Johnson, the South Dakota Democrat who is chairman of the committee, said a vote could come as early as next week to send her nomination to the full Senate...Ms. Yellen will need at least five Republican votes to reach the 60-vote threshold that the minority party routinely imposes on presidential nominees. The votes may not be hard to find." Binyamin Appelbaum in The New York Times.

The Fed's low-rate message is sinking in. "During the summer, as the Federal Reserve talked about pulling back on its $85 billion monthly bond-buying, investors in the futures markets saw that as a signal the Fed would raise short-term interest rates sooner than previously expected. Now investors expect the Fed to hold the line on rate increases even though expectations have reemerged that it will begin to scale back its bond buying in the next few months. Consider, for example, the December 2014 fed funds future contract. Trading in this contract suggests investors expect the federal funds rate – an overnight borrowing rate — to be 0.165% on average during the month of December 2014. The expected fed funds rate had reached 0.49% in early September." Jon Hilsenrath in The Wall Street Journal.

As Obama touts economic growth, mind is still on health care. "The news conference overshadowed what Obama had to say a few hours later after flying here for a 25-minute speech to manufacturing workers at ArcelorMittal, a steel company that has grown in recent years as the auto industry has recovered. To an audience of factory workers in yellow hard hats, Obama gave his regular pitch for rebuilding the manufacturing industry, arguing for a wide range of policies that would help the sector and the overall economy." Zachary A. Goldfarb in The Washington Post.

How banks' credit being downgraded is the best news about financial regulation you've heard in a long time. "Moody’s has cut the credit ratings of big US banks including Morgan Stanley, Goldman Sachs and JPMorgan Chase, after deciding that the federal government is less likely to bail the financial institutions out if they get into future difficulties. Goldman, Morgan Stanley and JPMorgan had the ratings on their long-term senior unsecured debt lowered one notch to Baa1, Baa2 and A3...“We believe that US bank regulators have made substantive progress in establishing a credible framework to resolve a large, failing bank,” said Robert Young at Moody’s. “Rather than relying on public funds to bailout one of these institutions, we expect that bank holding company creditors will be bailed-in and thereby shoulder much of the burden to help recapitalise a failing bank.”" Tracy Alloway, Michael Mackenzie and Tom Braithwaite in The Financial Times.

U.S. opens investigation on currency trading at major banks. "From their desks at some of the world’s biggest banks, traders exchanged a series of instant messages that earned them the nickname “the cartel.” Much like companies that rigged the price of vitamins and animal feed, the traders were competitors that hatched alliances for their own profits, federal investigators suspect. If those suspicions are correct, the group of traders shared a mission to alter the price of foreign currencies, the largest and yet least regulated market in the financial world...Although the investigation is at an early stage, authorities are already signaling the likelihood of a legal crackdown." Ben Protess, Landon Thomas Jr., and Chad Bray in The New York Times.

U.S. worker productivity rises. "Labor productivity, or output per hours worked, increased at a 1.9% annual rate from July through September, the Labor Department said Thursday. Economists surveyed by Dow Jones Newswires had forecast a gain of 2.4%. Second-quarter productivity growth was revised down to a 1.8% pace from a previous reading of 2.3%." Eric Morath in The Wall Street Journal.

...And the trade deficit widened. "The September U.S. trade deficit widened 8% from August to $41.8 billion, the Commerce Department said Thursday. Exports fell 0.2% while imports rose 1.2%, causing the trade gap to expand for the third-straight month. The report suggests exports, after rising earlier in the year, slumped during the summer as demand weakened in Europe, Japan and developing economies. The three-month moving average of exports, a reading of the underlying trend, slipped for the first time since May. Economists viewed the report as evidence the U.S. recovery is increasingly reliant on American consumers as a source of growth as demand sags from U.S. businesses, the federal government and customers abroad." Josh Mitchell in The Wall Street Journal.

Commerce’s Pritzker lays out her priorities. "Commerce Secretary Penny Pritzker plans to announce a new vision for the agency Thursday, outlining efforts to boost exports, spur more foreign investment in the United States, expand worker training and allow companies to better tap government data...In some ways, she is trying to follow through on President Obama’s first-term idea to merge a hodgepodge of federal agencies and create a “secretary of business.” Such integration may seem unlikely at the moment, but on her first day at Commerce, Pritzker hung a sign on her door: “Open for Business.”" Zachary A. Goldfarb in The Washington Post.

How Wal-Mart and Macy’s explain the economy. "Upper-income folks spend more money at Macy's — which also owns the tonier Bloomingdales — while Wal-Mart depends on the lower and middle classes. Right now, they're telling us something that's been apparent for a while, but is growing clearer month by month: While the wealthy in America seem to be doing all right, everybody else remains very, very cautious." Lydia DePillis in The Washington Post.

Weird history of medicine interlude: How they, um, showed that the earliest versions of erectile-dysfunction tablets worked at scientific conferences.

3. Bye bye, coal

Tennessee Valley Authority to close 8 coal-fired power plants. "The Tennessee Valley Authority, one of the nation’s five biggest users of coal for electricity generation, said Thursday it would close down eight coal-fired power units with 3,300 megawatts of capacity. The decision was prompted by a combination of environmental requirements, the age of the plants, competition from natural gas and declining electricity consumption in the TVA’s service area...The coal plants slated for closure include the TVA’s five Colbert units in Alabama, two units at Paradise in Kentucky, and one unit at Widows Creek in Alabama. The closures come on top of ones announced in 2011." Steven Mufson in The Washington Post.

Attack ravages power grid — but it's just a practice run. "By late Thursday morning, in this unprecedented continental-scale war game to determine how prepared the nation is for a cyberattack, tens of millions of Americans were in simulated darkness. Hundreds of transmission lines and transformers were declared damaged or destroyed, and the engineers were rushing to assess computers that were, for the purposes of the drill, tearing their system apart." Matthew L. Wald in The New York Times.

Chevron pipeline explodes, burns in rural Texas. "A Chevron Corp pipeline exploded near a tiny Texas town south of Dallas on Thursday, shooting flames high in the air and prompting evacuations from nearby homes and a school district, but no injuries were reported, the company and emergency officials said The explosion south of Milford, Texas, was caused by a construction crew that accidentally drilled into a 10-inch liquefied petroleum gas (LPG) line." Erwin Seba in Reuters.

Chief of major green group to retire in 2014. "The Natural Resources Defense Council (NRDC) on Thursday announced president Frances Beinecke will retire at the end of 2014. After joining the NRDC as an intern in 1973, Beinecke became the second president in the group's history in 2006." Laura Barron-Lopez in The Hill.

Behind the films interlude: The 5 ugly lessons behind every superhero movie.

4. "[M]ore than one other bulk collection program has yet to come to light"

CIA collects data on international money transfers. "The Central Intelligence Agency is secretly collecting bulk records of international money transfers handled by companies like Western Union — including transactions into and out of the United States — under the same law that the National Security Agency uses for its huge database of Americans’ phone records, according to current and former government officials. The C.I.A. financial records program, which the officials said was authorized by provisions in the Patriot Act and overseen by the Foreign Intelligence Surveillance Court, offers evidence that the extent of government data collection programs is not fully known and that the national debate over privacy and security may be incomplete...Several officials also said more than one other bulk collection program has yet to come to light." Charlie Savage and Mark Mazzetti in The New York Times.

Explainer: Everything we know about the Snowden leakMichael Kelly and Mike Nudelman in Business Insider.

NSA chief says Snowden leaked up to 200,000 secret documents. "Former U.S. National Security Agency contractor Edward Snowden leaked as many as 200,000 classified U.S. documents to the media, according to little-noticed public remarks by the eavesdropping agency's chief late last month." Mark Hosenball in Reuters.

Flickrs interlude: "Colors organized neatly." h/t Jason Kottke.

5. Google's court win

Google Books ruling is a huge victory for online innovation. "It's taken almost a decade, but the courts have finally handed down a ruling on Google's audacious project to scan millions of books to build a book search engine. The ruling is a decisive victory for Google, copyright's fair use doctrine  and online innovation...On Thursday, the gamble paid off, as Judge Denny Chin of the Southern District of New York handed Google a big victory. Chin praised the Google Books project for its many public benefits, and concluded that the project's transformative use of copyrighted books meant that the use of the books was legal under copyright's fair use doctrine." Timothy B. Lee in The Washington Post.

Reading material interlude: The best sentences Wonkblog read today.

Wonkblog Roundup

Why Mike Lee is more serious about prison reform than Rand PaulDavid Dagan.

The backlash against Obama's fix has already startedSarah Kliff.

How Obama plans to uncancel insurance plansSarah Kliff.

We still don’t know the most important Obamacare enrollment numberSarah Kliff.

Everything you need to know about the plans to ‘fix’ ObamacareEzra Klein.

The White House’s Obamacare fix is about to create a big mess. Sarah Kliff.

Janet Yellen faced the Senate today. Here’s everything you need to knowNeil Irwin.

Insurers are furious about the White House’s new Obamacare planSarah Kliff.

How Wal-Mart and Macy’s explain the economyLydia DePillis.

These maps show where the Earth’s forests are vanishingBrad Plumer.

Can Obama legalize 11 million immigrants on his ownBrad Plumer.

Et Cetera

The new, young MarxistsMichelle Golderg in Tablet.

Obama picks nominees for surgeon general, civil rights and other key postsAl Kamen in The Washington Post.

Republicans see no need to rush on tax reformLauren French, Brian Faler, and Kelsey Snell in Politico.

Got tips, additions, or comments? E-mail me.

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