Welcome to Wonkbook, Wonkblog’s morning policy news primer by Puneet Kollipara. To subscribe by e-mail, click here. Send comments, criticism or ideas to Wonkbook at Washpost dot com. To read more by the Wonkblog team, click here.
Wonkbook’s Number of the Day: $11. That's what Massachusetts just set as its new minimum wage, the highest base pay rate in the nation.
Wonkbook’s Chart of the Day: America's generational race gap is widening.
Wonkbook's Top 5 Stories: (1) So much for this Congress?; (2) supreme pragmatism in the Roberts court; (3) the Obamacare shopping mall; (4) the other folks raising the minimum wage; and (5) youthful exuberance in housing.
1. Top story: Election-year politics may mean this Congress is done until after midterms
Boehner's lawsuit means this Congress is pretty much done until midterms. "Mark yesterday, June 25, on your calendars: It was the day Congress all but closed up shop to focus on the midterms....Tellingly, Boehner’s letter didn’t cite a specific example of illegal or unconstitutional executive action, but his aides say the suit will likely focus on the health-care laws and energy regulations. But how do you expect Congress to get anything done for the rest of the year when the House has decided to sue the president?...Of course, there’s always the possibility that SOMETHING might take place during the lame duck. But only the stuff that HAS to get done to avoid operational shutdowns." Chuck Todd, Mark Murray and Carrie Dann in NBC News.
Related: Why Boehner's suit against the president may not see the light of day. Eric Pianin in The Fiscal Times.
Those operational must-dos: Highway funding, government spending, Ex-Im bank. "Ta ta, tax reform. See you later, immigration overhaul. Farewell, fiscal deal. As summer sets in, and lawmakers set their eyes on the November elections, the prospects for big, ambitious legislative deals have evaporated. But that doesn’t mean Congress can take the summer off and start planning Halloween parties. They have three issues with deadlines that must be addressed in the coming months. If no action is taken, there will be consequences of varying degrees." Damian Paletta in The Wall Street Journal.
A red card for immigration, or not? "A day after Congress’s biggest cheerleader for immigration legislation declared the effort dead, Vice President Joe Biden insisted it is still alive. Mr. Biden told a gathering of a dozen people representing law enforcement, agriculture interests and religious communities that despite Rep. Luis Gutierrez (D., Ill.) showing a red card — soccer’s version of a being thrown out of the game — to House Republicans on immigration reform, the White House still thinks it a deal can be reached on Capitol Hill." Reid J. Epstein and Laura Meckler in The Wall Street Journal.
Timeline: The rise and fall of immigration reform. David Nakamura and Ed O'Keefe in The Washington Post.
Long read: How immigration reform died. Seung Min Kim and Carrie Budoff Brown in Politico.
Jobless-benefits legislation? Probably not, but keep an eye on it. "A handful of House Democrats wrote a letter to Majority Leader-Elect Kevin McCarthy (R-CA) requesting a meeting to discuss a bipartisan path towards helping the long-term unemployed. The move appears to be an attempt to end-run House Speaker John Boehner (R-OH), who has blocked previous efforts to renew a federal extension of long-term unemployment benefits. Boehner has said repeatedly that he won’t support a bill that doesn’t include tax incentives and other measures to create jobs." Reilly Dowd in The Fiscal Times.
As highway fund runs dry, Congress leaves for recess. "The nation’s Highway Trust Fund remains on the road to insolvency this summer, with a zero balance expected by Sept. 30....But no sooner did Senate Democrats this week describe a $9 billion 'patch' plan...than House Republicans flatly rejected it. House Republican leaders had their own plan last month — which, oddly for some, involved cutting back Saturday postal delivery to find some money. But Senate Democrats and outside conservative groups ridiculed that idea. In fact, many of the Republicans’ own rank-and-file members did not like it much either. So what are lawmakers now preparing to do? They are set to leave Washington on Thursday for their Independence Day recess and not planning to return until July 8." Billy House in National Journal.
Possible breakthrough on short-term highway stopgap? "After a sour reaction from Republicans to Senate Finance Chairman Ron Wyden’s first proposal to bolster the Highway Trust Fund, prospects for a deal looked better Thursday after the Oregon Democrat offered a modified plan that dropped his idea of raising heavy vehicle use taxes by $1.3 billion. Wyden’s revised plan also added a provision that would shift to the highway trust fund $750 million from a fund intended to deal with leaking underground fuel tank." Tom Curry in Roll Call.
Is a compromise over Ex-Im Bank in the works? "Rep. John Campbell, a California Republican, said he has drafted compromise legislation that addresses some of the concerns of conservative Republicans who oppose the bank as a taxpayer-subsidized giveaway to large companies....Campbell's proposed legislation would limit the agency's ability to provide aid to state-owned companies. It also would lower the bank's lending cap, responding to concerns that the bank puts too much taxpayer money at risk. And it would reauthorize the bank for just three years, rather than the five requested by Ex-Im. Several Republicans at the hearing voiced support for a compromise without specifically endorsing Campbell's proposal." Christopher S. Rugaber in the Associated Press.
Why the so-called discharge petition technique wouldn't work here. "House Democrats won’t be able to use a discharge petition to push through a reauthorization of the Export-Import Bank before its charter expires. With only 27 legislative days remaining before the bank's authority lapses, a discharge petition wouldn’t be 'ripe' in time to renew it before the Oct. 1 deadline. Discharge petitions take 30 legislative days to become valid. That means that the Democrats' Ex-Im bank bill, introduced Wednesday, won't be ripe until Nov. 12. Still, Democrats haven't ruled out the option." Vicki Needham and Mike Lillis in The Hill.
We've seen this fight before. But this time could be different. "Since...Ronald Reagan swooped into Washington vowing to change business as usual, forces on the right — and occasionally the left — have clamored to kill or shrink the Ex-Im Bank....Yet through it all, presidents went on to sign legislation to reauthorize the bank — and even to expand its funding and reach — under heavy lobbying pressure....There is good reason to think this time might be different. For one, the House GOP leadership is stacked against the bank as never before — thanks in part to shakeups brought about by the tea party....Meanwhile, the chief lawmaker responsible for moving any reauthorization, House Financial Services Chairman Jeb Hensarling, is among the bank’s loudest foes." Neil King Jr. in The Wall Street Journal.
Business Ex-Im backers aren't going down without a fight. "Don...Nelson's small oilfield equipment company is part of new House Majority Leader Kevin McCarthy's district, and he wants the suddenly powerful politician to know that the Republican right's war on what it sees as 'crony capitalism' at the export credit agency could claim hometown casualties....Ex-Im's fate may hinge on the success Nelson and other small entrepreneurs have in convincing their lawmakers that the agency...aids the very small businesses that Republican critics say are being put at a competitive disadvantage by the program. The bank has had mixed success on that front." Howard Schneider and David Lawder in Reuters.
Explainer: How a once-obscure agency is dividing the GOP over "corporate welfare." Rebecca Robbins in The Washington Post.
A potential government shutdown looms. Should Obama veto spending bills? "There’s life after a veto....Clinton seemed to relish it....Is it time now for President Barack Obama to come off the sidelines to do the same: for his own good and to buy some running room for the Democratic Senate?...These are questions raised by the latest appropriations pileup....Behind this paralysis are the contradictions of both parties. Republicans insist that the last thing they want is another government shutdown. But the GOP then sets about to gum up the works with amendments which are veto bait for Obama....Democrats are so risk-adverse that they seem forever in a defensive crouch — not wanting to vote on tough amendments before November’s elections and not wanting Obama to veto bills either." David Rogers in Politico.
STIGLITZ: Myth of America's golden age. "The inequalities of the 19th and early 20th centuries seemed to be diminishing. This conclusion appeared to be vindicated during the period from World War II to 1980, when the fortunes of the wealthy and the middle class rose together. But the evidence of the last third of a century suggests this period was an aberration.....Today, inequality is growing dramatically again, and the past three decades or so have proved conclusively that one of the major culprits is trickle-down economics — the idea that the government can just step back and if the rich get richer and use their talents and resources to create jobs, everyone will benefit. It just doesn’t work; the historical data now prove that." Joseph E. Stiglitz in Politico Magazine.
BROOKS: Is America losing faith in universal democracy? "When the U.S. was a weak nation, Americans dedicated themselves to proving to the world that democracy could last. When the U.S. became a superpower, Americans felt responsible for creating a global order that would nurture the spread of democracy. But now the nation is tired, distrustful, divided and withdrawing. Democratic vistas give way to laissez-faire fatalism: History has no shape. The dream of universal democracy seems naïve. National interest matters most....But if America isn’t a champion of universal democracy, what is the country for? A great inheritance is being squandered; a 200-year-old language is being left by the side of the road." David Brooks in The New York Times.
KRUGMAN: So much for Obamacare not working. " The Affordable Care Act has receded from the front page, but information about how it’s going keeps coming in — and almost all the news is good. Indeed, health reform has been on a roll ever since March, when it became clear that enrollment would surpass expectations despite the teething problems of the federal website. What’s interesting...is that it has been accompanied at every step by cries of impending disaster. At this point, by my reckoning, the enemies of health reform are 0 for 6....It's about politics and ideology, not analysis. But while this observation isn’t particularly startling, it’s worth pointing out just how completely ideology has trumped evidence in the health policy debate." Paul Krugman in The New York Times.
RAMPELL: Ikea and the Gap's minimal movement on minimum wages. "It’s a sad state of affairs when companies that pay some of their workers poverty-level wages are celebrated for their beneficence. On Thursday, with a bit of pomp, circumstance and self-back-patting, Ikea announced it would give some of its workers a raise. The Swedish ready-to-assemble furniture retailer trumpeted that it was boosting its 'average minimum hourly wage in existing U.S. stores' to $10.76, affecting about half its American workforce. Sounds good, for the most part, especially relative to the federally mandated minimum of $7.25 an hour. But did you catch Ikea’s statistical sleight of hand? I’m referring to the slippery word 'average.'" Catherine Rampell in The Washington Post.
SMITH AND WALTER: Getting serious about sanctions-busting banks. "Some foreign banks apparently assumed they could get around U.S. sanctions with impunity. They haven't. The Justice Department has made it clear it will use the criminal law to enforce the rules even when the banks' government officials have attempted to intervene. BNP Paribas shows that the U.S. can and will impose financial sanctions unilaterally in the dollar market without the broad agreement that is typically required for other international policy issues. By pursuing this case, the U.S. government has dramatically boosted the credibility of financial sanctions that banks around the world now need to take very seriously." Roy C. Smith and Ingo Walter in The Wall Street Journal.
Animal interlude: World's ugliest dog gets a makeover.
2. Supreme pragmatism at the court
Unconventional vote in Supreme Court's abortion buffer-zones decision. "The Supreme Court on Thursday unanimously struck down protest-free buffer zones around abortion clinics in Massachusetts as an unconstitutional infringement on free speech. But Chief Justice John G. Roberts Jr.’s ruling was a narrow one, pointing out that other states and cities had found less-intrusive ways to both protect women entering clinics and accommodate the First Amendment rights of those opposed to abortion....Significantly, only the court’s liberals joined Roberts’s opinion: Justices Ruth Bader Ginsburg, Stephen G. Breyer, Sonia Sotomayor and Elena Kagan. That is a rare combination at the court, Roberts’s majority opinion upholding the Affordable Care Act in 2012 the most notable example." Robert Barnes in The Washington Post.
The Supreme Court's explanation for why sidewalks matter more than ever to free speech. Emily Badger.
Chart: A more nuanced breakdown of the Supreme Court. Hannah Fairfield and Adam Liptak in The New York Times.
All of the sudden, we're seeing a ritual of pragmatism from the court. "It’s becoming a June ritual: Chief Justice John Roberts joins the liberals to issue a moderate, centrist opinion, and leaves his erstwhile conservative admirers flailing....True, Roberts’s opinion, joined by the court’s four doubtless relieved liberals, struck down the buffer as a violation of the free-speech rights of pro-life activists who seek to converse with women who might be seeking abortions. But the crucial element in the opinion — the one that got the liberals on board and enraged the conservatives — is that Roberts said the law was neutral with respect to the content of speech as well as the viewpoint of the speakers." Noah Feldman in Bloomberg View.
Pragmatism triumphed over formalism in the recess-appointments ruling. "A sharply divided Supreme Court on Thursday embraced a practical constitutional solution to filling temporary vacancies in U.S. government posts. Refusing to strip presidents of nearly all power to make such appointments, as four dissenters would have, the majority set some limits but still kept that authority mostly intact. The decision did nullify a handful of President Obama’s appointments because the Senate was not technically in recess when he made them....But the scope of that defeat for Obama in particular and presidents in general seemed quite small." Lyle Denniston in SCOTUSblog.
So, when is the Senate actually in recess? "A Senate with a Democratic majority used pro forma sessions every three days in 2007-2008 to prevent President George W. Bush from making recess appointments, and Bush didn't contest the maneuver. Then, in 2011, the Republican majority in the House of Representatives tried the same workaround, which forced the Senate to stay 'in session' because of the constitutional provision that when one chamber is in session, the other cannot adjourn for 'more than three days.'...The court didn’t differentiate those two very different situations...but Associate Justice Stephen Breyer reminded everyone that there is another option for combating the House: The Constitution allows the president to act if the two chambers cannot agree on adjournment." Jonathan Bernstein in Bloomberg View.
Abortion clinics are scrambling to respond to the buffer-zones ruling. "Walz says clinics are reworking their security plans, boosting patient escorts, for example. But she says assuring patient safety will be more challenging now....Walz says clinics will use other legal tools, for example, seeking court injunctions against protesters who are aggressive, or using other federal state and local laws that protect access to health care facilities. Advocates say they'll also explore new legislation, for example, a floating bubble around patients where protesters are barred. But protesters say existing law already makes it clear that there is a line they can't cross even if the actual 35 foot line is no longer in place." Tovia Smith in NPR.
KATYAL: A Supreme consensus. "For years, particularly after the 2000 election, talk about the Supreme Court has centered on its bitter 5-to-4 divisions. Yet it is worth reflecting on a remarkable achievement: The court has agreed unanimously in more than 66 percent of its cases this term....The last year this happened was 1940. The justices’ ability to cross partisan divides and find common ground in their bottom-line judgment in roughly two-thirds of their cases — including the two decisions handed down Thursday, restricting the president’s ability to issue recess appointments during brief breaks in the Senate’s work, and striking down a Massachusetts ban on protests near abortion clinics — should remind us that even in this hyperpartisan age, there is a difference between law and politics." Neal K. Katyal in The New York Times.
YGLESIAS: How our broken Congress gave us hyper-empowered judiciary. "On June 25, the Supreme Court ruled against a company called Aereo in a case that while not super-important on its face has potentially significant implications for the entire cloud storage industry. Back on June 19, in another ruling, the Court substantially restricted the eligibility of software innovations for patent monopolies. And on June 23, it made it harder for the Environmental Protection Agency to restrict greenhouse gas emissions. These three rulings have two things in common. They're all very consequential for American public policy, and they all have nothing to do with the United States Constitution or the Bill of Rights. And that's a problem." Matthew Yglesias in Vox.
Other legal reads:
Court upholds gun-background checks in Colorado. Dan Frosch in The Wall Street Journal.
A year after voting-rights decision, Dems doubt they’ll get law update soon. Wesley Lowery in The Washington Post.
Hobby Lobby isn't the end. Other anti-Obamacare lawsuits also loom. Dan Diamond in Advisory Board Daily Briefing.
Happy birthday interlude: Watch what happens when this dog gets 100 balls for his birthday.
3. What will it be like to shop for Obamacare in year two?
Rules would enable most to stay in Obamacare plans. "Under the rules, people will need to do very little to remain in their health plans if their incomes and covered family members are not changing and their plans are offered again for 2015. A fraction of the people in the federal insurance exchange will need to reapply for one or more reasons: their incomes are rising or falling significantly, they did not give permission for their tax records to be checked automatically, or the health plans they joined this year disappear as of January. These rules have been anxiously awaited by consumer advocates and others concerned about whether the policies and the computer systems underlying the federal health insurance marketplace would make it easy or cumbersome...to continue the coverage." Amy Goldstein in The Washington Post.
Why Obamacare makes shopping for insurance so important. "People generally stick with their coverage year-to-year if they can help it, even if it means missing out on a better deal. Today, the consulting firm Avalere Health demonstrates why that could be an especially troublesome thing for low- and middle-income people enrolled in the new exchange health plans....Looking at just the proposed rates for 2015 health plans in nine states, six of those states could see health plans lose their benchmark status in 2015. That means if people stay in those plans, their premium subsidy won't go as far. Of course, these are just proposed rates in just a few states that could still change — but this underscores how the exchange landscape could shift pretty dramatically year-to-year." Jason Millman in The Washington Post.
Can Obamacare make insurance shopping easier? "The Wall Street Journal recently uncovered an interesting trend: The largest health insurers in a state are generally asking for the highest premium increases. That story was followed by news this week that the District of Columbia's largest insurer is asking for premium hikes much larger than the ones sought by its competitors. The big takeaway...'With dominant market share now, analysts say, carriers feel they have room to raise rates.'...Either way...just how much will people buying their own coverage shop around for a better deal on health insurance year-to-year? By creating a marketplace where plans have to compete for business under the same rules, Obamacare is supposed to facilitate the shopping experience. Some recent studies throw cold water on that idea, though." Jason Millman in The Washington Post.
Why selling health insurance around Christmas time is a bad idea. "Few Americans, given the choice, would buy health insurance over a Christmas present. And yet, the open enrollment period for federal Marketplace plans on Healthcare.gov coincides with the winter holidays, one of the most financially stressful times of the year. That's why researchers suggest switching the open enrollment period to line up with a less stressful time. Namely, in spring, just after people have received their tax return....Beyond the holiday stress, many low-income people have a very real reason for holding off on purchasing health insurance until they get their tax return — that is, they may not know their expendable income until they do." Shelley DuBois in The Tennessean and USA Today.
Best state for Obamacare: California, for its smooth rollout. Reid Wilson in The Washington Post.
Other health care reads:
Drinking is behind 1 in 10 deaths of working adults, study says. Hoai-Tran Bui in USA Today.
Long read: Is that hospice safe? Infrequent inspections mean it may be impossible to know. Peter Whoriskey in The Washington Post.
Long read: Cost of not caring — stigma set in stone. Mentally ill suffer in sick health system. Liz Szabo in USA Today.
Health care profit outlook brightens on drug prices, Obamacare. Caroline Valetkevitch in Reuters.
Patience interlude: "I dare you to watch this entire 3-minute video."
4. States and localities aren't the only ones raising their minimum wages; businesses are, too
Ikea bumps up its minimum wage. "Ikea Group, the world’s largest furniture seller, will boost the average minimum hourly wage for workers at its U.S. stores to $10.76 as retailers and fast-food chains face criticism for not paying enough. The 17 percent increase begins Jan. 1 and will benefit about half of the Swedish company’s U.S. retail workers....The wage will vary based on the cost of living in Ikea’s 38 locations....The decision may add fodder to a national debate on whether the federal government needs to raise the minimum wage. President Barack Obama wants to increase it to $10.10 an hour from $7.25....Most Republican lawmakers oppose the idea." Lindsey Rupp in Bloomberg.
How one scholar's living wage calculator made it happen. "Ikea is basing its new wage structure on MIT’s Living Wage Calculator, a Web site that shows how much workers need to make in any given county or municipality to afford basic goods....While Glasmeier said she gets many inquiries about the data from public officials or smaller employers, it appears that Ikea is the first global corporation to base its wages on it. With just 38 stores in the United States, the company’s footprint is much smaller than that of Gap, which has a store in thousands of malls. But Glasmeier said such a move could have an impact." Jena McGregor in The Washington Post.
Why are companies doing it? Mind the Gap. "When Gap (GPS) Chief Executive Officer Glenn Murphy announced in February that the retailer would raise the minimum wage it pays employees, he said the decision wasn’t determined by any political calculations and that paying more made business sense. Now Murphy can prove it: Gap raised its starting wage to $9 an hour this week (it will become $10 next year) and already the company says it’s getting more and better-qualified job applicants....Applications for jobs at Gap have increased 20 percent, he said." Susan Berfield in Bloomberg Businessweek.
Explainer: 7 companies that aren't waiting for Congress. Rebecca Hiscott in The Huffington Post.
Same calculator says Massachusett's new highest-in-nation minimum wage still not a living wage in the Bay State. "The new minimum wage law enacted Thursday — pushing the hourly rate in Massachusetts from $8 to $11 dollars over the next few years — gives the state the highest base pay in the nation. In Massachusetts, the hourly rate a full-time worker needs to pay for food, housing, transportation, and other regular expenses is at least $11.31 an hour, according to the Living Wage Calculator....In Boston and Braintree, where the Urquharts live, it’s $12.65 an hour. The pay raise Arline and Ashley Urquhart will get from the new law...will make their lives a little more stable, a little less stressful. But not necessarily comfortable." Katie Johnston in The Boston Globe.
Analysis: Where are the toughest places to live in the U.S.? Alan Flippen in The New York Times.
Other labor reads:
Jobless claims edge down in latest week. Eric Morath in The Wall Street Journal.
World Cup interlude: Patriotism and Will Ferrell back up Team USA against Germany.
5. How young people's housing situations could affect the economy
The recession pushed young adults to move in with their parents. Now they're moving out. "Harvard University’s Joint Center for Housing Studies projects that the millennials — the largest and most diverse generation in history — will make up 24 million new households between 2015 and 2025, substantially boosting demand for rentals and starter homes. The leading edge of this closely watched generation will soon reach their 30s, the age range in which household formation ramps up....As a result, the number of households in that age group will rise by 2.7 million in the next decade....The sheer number of young adults in this generation (nearly 86 million) is what makes them an especially influential force in the housing sector." Dina ElBoghdady and Emily Badger in The Washington Post.
Charts: Millennials are about to have a big impact on the housing market. But what will it look like? Emily Badger in The Washington Post.
How the administration is seeking to boost rental housing. "The Obama administration announced plans Thursday to beef up a program that reduces the cost of loans that local housing authorities grant to builders that construct and renovate apartment buildings that cater to low-income people. The Treasury Department is joining the Federal Housing Administration to help finance the 22-year-old program, which enables participating housing authorities to share the risk of the loans with the federal program. By having both Treasury and the FHA inject federal dollars into the program, the housing authorities would get about $500 millon to $1 billion a year vs. the roughly $363 million that the FHA doled out last year." Dina ElBoghdady in The Washington Post.
Mortgage rates are down despite cuts to Fed stimulus. "The great rate freakout of June 2013 looks awfully panicky in the rearview mirror, with fixed mortgages now far cheaper than they were back then. It's been a full year since the Federal Reserve unnerved home lenders and buyers by announcing it would choke back a stimulus program that had sent long-term borrowing costs to record lows. The average 30-year mortgage rate leaped from 3.93% to 4.46% that week, according to Freddie Mac's survey — the biggest weekly jump since 1987." E. Scott Reckard in the Los Angeles Times.
Summer science interlude: The science of sunburns.
The Supreme Court’s defense of why free speech on sidewalks matters more than ever. Emily Badger.
Has the developed world stopped waging trade wars? Lydia DePillis.
Obamacare makes actually shopping for health insurance really important. Jason Millman.
Millennials are about to have a big impact on the housing market. But what will it look like? Emily Badger.
How the current food debate is failing America. Roberto A. Ferdman.
More than three quarters of conservatives say the poor "have it easy." Christopher Ingraham.
Candidate Obama, echoing tea party, called Ex-Im Bank "little more than a fund for corporate welfare." Zachary A. Goldfarb.
Private auctions of public parking spots are bad public policy. Emily Badger.
A year after Supreme Court ruling, a rundown of what’s changed for same-sex couples. Jonnelle Marte.
Some campuses still hostile to sexual-assault survivors, official testifies. Kimberly Hefling in the Associated Press.
Beyond red and blue: The political typology. Pew Research Center.
U.S. second-quarter growth forecasts cut on tepid consumer spending; inflation trending higher. Lucia Mutikani in Reuters.
Americans' generational race gap widens. Laura Meckler in The Wall Street Journal.
Deportation separated thousands of U.S.-born children from their parents. Elise Foley in The Huffington Post.
FAA, developers clash over tall buildings. Joan Lowy in the Associated Press.
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