Wonkbook: The policies that could help America’s veterans

August 27

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(Photo by Davis Turner/EPA)

Wonkbook’s Number of the Day: 33 percent. That's the fall in the number of homeless vets since 2010, new data show.

Wonkbook’s Chart of the Day: The majors most and least likely to lead to underemployment.

Wonkbook's Top 5 Stories: (1) The administration's push for veterans; (2) what's the Burger King inversion really about?; (3) the new Obamacare CEO; (4) the blunter case for climate policy; and (5) demand is picking up, but what's the deal with housing?

1. Top story: Obama's latest move to help America's veterans

Obama tells vets he will issue orders to improve mental care, lower housing costs. "Among other things, members of the military leaving service will be automatically enrolled in the department’s transition program, rather than having to seek it out themselves or requiring referrals. The department will test expanded peer support for mental health, conduct studies on early detection of post-traumatic stress and suicidal thoughts, and extend suicide prevention and mental health training for health care providers, chaplains and others who work with veterans. The Obama administration will also team up with banks to make it easier for active-duty service members to reduce mortgage interest rates." Peter Baker and Dave Philipps in The New York Times.

ICYMI: All this happens as VA plans fixes in response to watchdog report. Gregg Zoroya in USA Today.

Digging deeper: VA watchdog confirms patients died after receiving poor care, not delayed care. "The Department of Veterans Affairs’ watchdog confirmed Tuesday that numerous veterans died after receiving poor care in a VA hospital in Phoenix, Ariz., but stopped short of substantiating widely reported allegations that at least 40 veterans died while awaiting care. The VA inspector general’s office...reviewed the records of 3,409 veterans and found 45 cases where patients experienced 'unacceptable and troubling lapses' in care. Of those, 28 experienced long delays in care, and six died, the report said. Seventeen other patients experienced care that 'deviated from the expected standard independent of delays,' and 14 of them died." Dan Lamothe in The Washington Post.

VA touts progress on suicides, but data tell different story. "Seven years ago, the U.S. Department of Veterans Affairs rejected allegations by media outlets and watchdog organizations that America faced a suicide epidemic among former military personnel. The VA claimed just 790 veterans under department care had taken their own lives that year. Yet, by reviewing available public records since 2005, CBS News uncovered 6,256 suicides. As VA officials publicly disputed the network's data, Dr. Ira Katz, the top mental-health officer, was sending internal e-mails titled 'Not for the CBS Interview Request.'" Dennis Wagner in USA Today.

Data do suggest that the number of homeless vets is falling. "The number of homeless veterans in the United States has fallen 33 percent since 2010, to just under 50,000 as of January. The number of homeless veterans sleeping in the street, as opposed to in shelters, fell even faster, down nearly 40 percent over the past four years. At least those were the figures put out by a trio of federal agencies in a news release Tuesday. When I first saw the numbers, I was more than a little skeptical...especially at a time when the Department of Veterans Affairs is mired in scandal. I’ve looked into the numbers, though, and it seems my skepticism was misplaced. The number of homeless veterans really does seem to be falling. What’s more, it’s falling at least in large part due to government intervention." Ben Casselman in FiveThirtyEight.

VA scandal probe targets potential obstruction of justice. "The Justice Department and the FBI have joined the Veterans Affairs inspector general to investigate allegations of obstruction of justice at dozens of veterans hospitals across the country, according to a long-awaited report released Tuesday. The report by the Department of Veterans Affairs Office of Inspector General said 93 VA health care sites across the country are being investigated in connection with falsifying scheduling records to hide delays in veterans' health care and 'attempting to obstruct OIG (Office of Inspector General) and other investigative efforts.'" Gregg Zoroya in USA Today.

How will Republicans react to new round of executive orders? "There was no immediate reaction from House Republicans to today’s announcement. A request for comment sent to the office of House Speaker John Boehner had not been returned when this story was published. However, in their announcement yesterday, House Republicans made clear they intend to continue pursuing legal action against the president for his use of executive actions, focusing mainly on his decision to delay enforcement of the Affordable Care Act’s employer mandate, which required businesses above a certain size to make health insurance available to employees." Rob Garver in The Fiscal Times.

Separately, study says Pentagon can easily drop its ban on transgender troops. "The results of a forthcoming study, which was provided to Checkpoint, found that a repeal on transgender service could be lifted in a way that would not be burdensome or exceedingly complex for the military. The Palm Center, a think tank in San Francisco...says that there already are 15,500 transgender personnel in the U.S. military, but they are not allowed to serve openly." Dan Lamothe in The Washington Post.

DAVIDSON: Bad VA service can be improved, but broken trust is much harder to fix. "Mistakes can be corrected. Bad service can be improved. Broken trust, however, can be difficult to fix. President Obama is trying to rebuild confidence in the Department of Veteran Affairs (VA)....In a speech to the American Legion convention in Charlotte, N.C., Tuesday he used the word 'trust' at least a half dozen times. Of course it will take more than words to overcome suspicions left by the ma­nipu­la­tion of waiting lists — pushed by productivity goals employees could not meet." Joe Davidson in The Washington Post.

Top opinion

EBERSTADT: How the world is becoming more equal. "Is the human condition becoming more unequal? Many assert it is, but their focus is almost exclusively on economic inequality. This is problematic for two key reasons. First, even in data-rich America, statistics on wealth distribution are at best rudimentary. Measured economic equality differs dramatically depending on whether one looks at income (pre- or post-tax? by the year or over a lifetime?), or at personal consumption, which seems to be distributed much more equally. More crucially, income is not the only important measure of human well-being and life chances. Consider two global revolutions that are improving the human condition and making it more equal." Nicholas Eberstadt in The Wall Street Journal.

GALSTON: Secular stagnation may be real. "In the economic circumstances of recent decades, only a sustained period of robust growth has raised wages and household incomes. Unless the economy can resume the more robust growth of the second half of the 20th century, U.S. workers will be hard-pressed to regain the ground they have lost, let alone offer the prospects of something better for their children. A growing number of macroeconomists, led by former Treasury Secretary Lawrence Summers, have begun questioning whether a return to past growth rates is feasible. We may be facing, they suggest, a structural change in the global economy that makes slower growth in developed economies — 'secular stagnation' — the rule, not a transient aberration." William A. Galston in The Wall Street Journal.

EDSALL: The expanding world of poverty capitalism. "Sentinel is a part of the expanding universe of poverty capitalism. In this unique sector of the economy, costs of essential government services are shifted to the poor. In terms of food, housing and other essentials, the cost of being poor has always been exorbitant. Landlords, grocery stores and other commercial enterprises have all found ways to profit from those at the bottom of the ladder. The recent drive toward privatization of government functions has turned traditional public services into profit-making enterprises as well." Thomas B. Edsall in The New York Times.

BUCHANAN: Recessions and big shock theory. "For most economists, that's the end of the discussion: Recessions are either the result of big shocks, or of small shocks with amplification. They ignore a third possibility: that an economy might sometimes get seriously out of shape with no shock at all. The omission is odd, because this way of thinking was quite common in economics some 50 years ago. Fortunately, a group of economists and physicists is reviving the old 'no shock' idea." Mark Buchanan in Bloomberg View.

CHEMERINSKY: How the Supreme Court protects bad cops. "If the conclusion is that the officer, Darren Wilson, acted improperly, the ability to hold him or Ferguson, Mo., accountable will be severely restricted by none other than the United States Supreme Court. In recent years, the court has made it very difficult, and often impossible, to hold police officers and the governments that employ them accountable for civil rights violations. This undermines the ability to deter illegal police behavior and leaves victims without compensation. When the police kill or injure innocent people, the victims rarely have recourse." Erwin Chemerinsky in The New York Times.

MILLER: Genetic engineering and the fight against Ebola. "A handful of patients in the largest-ever Ebola outbreak have been treated with an experimental drug called ZMapp. American missionaries Dr. Kent Brantly and Nancy Writebol both received the drug and were recently released from the hospital. A Liberian doctor treated with the drug died on Sunday. The medicine is made through 'biopharming,' a relatively new and promising way to create drugs through genetic engineering, but the technology is stymied by regulation and fear-mongering." Henry I. Miller in The Wall Street Journal.

Dog days of summer interlude: A bunch of videos to celebrate National Dog Day.

2. Are taxes really motivating the Burger King-Tim Horton's merger?

ICYMI: Burger King agrees to buy Tim Horton's. "Burger King Worldwide Inc. (BKW) agreed to acquire Tim Hortons Inc. (THI) for about C$12.5 billion ($11.4 billion) in a deal that creates the third-largest fast-food company and moves its headquarters to Canada....The acquisition also moves the merged entity’s global headquarters to Canada, potentially taking advantage of lower corporate taxes. When the companies disclosed the talks on Aug. 24, it heightened debate over American businesses shifting to other countries in search of lower tax bills. President Barack Obama criticized the practice in July, and his aides said that the administration would take action to stop the trend." Leslie Patton and Craig Giammona in Bloomberg.

But more than just taxes may be at stake in the merger. "A merger...may also come with a tasty side: an exit ramp for its private-equity backers. The deal, structured as a so-called tax inversion, would let Burger King relocate to Canada, home to Tim Hortons and a newly lowered 15% corporate tax rate. But at least one analyst says it might be more about creating liquidity for Brazilian buyout shop 3G Capital Management, which took Burger King private in 2010 and still owns 69% of its stock." Liz Hoffman in The Wall Street Journal.

Burger King execs say current effective tax rate similar to Canada's corporate rate. "Burger King executives say...Whopper devotees should take them at their word. Canada’s corporate tax rate is 26.5 percent, which is considerably lower than the 40 percent rate in the U.S. But Burger King only pays an estimated 27 percent. 'We don’t expect our tax rate to change materially,' Burger King Chief Executive Daniel Schwartz said in a conference call today. 'This transaction is not really about taxes. It’s about growth.'" Devin Leonard and Venessa Wong in Bloomberg Businessweek.

Buffett, Berkshire will earn big profits from deal... "A couple of years ago, billionaire investor Warren Buffett was making the rounds of cable television business shows talking about how corporate taxation in the U.S. really isn’t all that high. 'It's a myth that American corporations are paying 35 percent or anything like it,' Buffett told CNBC....But there is nothing mythical about the profits Buffett will earn....Burger King will continue to pay taxes on the money its thousands of U.S. franchises earn. The key change is that the company will no longer be liable for U.S. taxes on money earned by its overseas franchises....Canada, like most other countries, only collects taxes on money earned within its borders." Rob Garver in The Fiscal Times.

...though Berkshire will pay U.S. taxes on dividends from deal. "If the deal goes through, Berkshire will get preferred stock in the combined Canadian company, according to the person familiar with the deal. The preferred shares will pay Berkshire a dividend at a high interest rate. However, since Berkshire is a U.S. company based in Omaha, Neb., it would pay U.S. federal corporate taxes at the rate of 35% on the dividend amount. Canada’s federal corporate income-tax rate is about 15%." Anupreeta Das in The Wall Street Journal.

White House response: Do something, Congress! Damian Paletta in The Wall Street Journal.

At least for now, those executive actions Treasury is mulling may be Obama's only option. "The move has been lighting up social media, with Burger King’s Facebook page buzzing with customers calling for a boycott and blasting the company as a traitor, Democrats renewing calls to act immediately and Republicans calling it a symptom of the dysfunctional U.S. tax system. But despite hand-wringing by lawmakers of both parties — and a shaming by President Barack Obama...prospects for any kind of intervention by Congress are still dim." Kelsey Snell in Politico.

FLEISCHER: Consumer reaction may be crucial in merger. "It may be easier for an insurance company or oil and natural gas company to undertake an inversion than for a consumer brand. We saw a glimpse of this a few weeks ago, when the Walgreen Company was considering an inversion, then backed away....On the other hand, Burger King has to deal with something that Stanley Works did not: social media....Twitter is not the optimal medium to debate tax policy, but such is the deal environment a consumer company like Burger King must manage....In the end, Burger King may have an ace in the hole in the form of Warren E. Buffett." Victor Fleischer in The New York Times.

GLECKMAN: A sales-based tax formula? "The good news is the tax inversion flap has generated some interesting ideas for broader changes in the way we tax multinational firms. One...called single sales factor apportionment, a multinational would report income for all its worldwide entities and be taxed on a share of its total worldwide profits. But the tax would be apportioned by the percentage of the firm’s worldwide sales that occur in an individual country. For instance, if half of a firm’s sales occurred in the U.S., half of its worldwide profits would be subject to U.S. tax. The levy would apply to all corporations, whether based in the U.S. or elsewhere. This would be a dramatic change from today’s system." Howard Gleckman in Forbes.

HILTZIK: Is Buffett really betting against America? "Back in February, in his annual message to shareholders in his company Berkshire Hathaway, Warren Buffett said this: 'Who has ever benefited during the past 237 years by betting against America? ... America's best years lie ahead.' You can expect these words to be thrown back in Buffett's face this week (as we're doing), as word spreads of his investment....But it's worthwhile to take a closer look at Buffett's involvement, and about his opinion of corporate taxation — indeed, of taxes in general. Here's a spoiler: He doesn't think U.S. corporate taxes are too high, and he's not really in favor of the inversion loophole." Michael Hiltzik in the Los Angeles Times.

Another dog interlude: Cockatoo feeds treats to dog.

3. Meet the new CEO of HealthCare.gov

Connecticut exchange leader named CEO of HealthCare.gov. "Kevin Counihan, who led one of the country’s most successful Obamacare exchanges, will take over as CEO of HealthCare.gov before the next insurance sign-up season, the Department of Health and Human Services announced Tuesday. It’s the latest in a series of hires by HHS Secretary Sylvia Mathews Burwell, who is bringing in a new management team keen to avoid a repeat of last fall’s disastrous launch of the federal exchange. HHS is still looking for a permanent chief technology officer for HealthCare.gov, but the agency announced Tuesday that Tim Hughey of Accenture will effectively fill that role in the interim." Sarah Wheaton in Politico.

Why Counihan? "Counihan, also a former executive with the Massachusetts exchange that was a model for the Affordable Care Act, ran the Connecticut exchange, which managed to avoid major tech glitches while reportedly cutting the state's uninsured rate in half this year. Maryland is planning to use Connecticut's technology for the upcoming enrollment period, and other states have looked at using the Connecticut platform. Connecticut also did some unique things to boost enrollment, like setting up a handful of storefronts across the state that were modeled after Apple's retail locations....That's not to say, though, that Connecticut's exchange hasn't been without its problems." Jason Millman in The Washington Post.

Democrats are slowly learning to love Obamacare. "Democrats won't be mounting a big political offensive around the Affordable Care Act any time soon, but they're beginning to test the pro-Obamacare waters. Heading into the 2014 midterms, Republicans continue to hold a clear advantage in the politics of Obamacare. And even if the tide does ultimately shift for the law, it almost certainly won't happen by November. Still, there are signs that Democrats are slowly becoming more confident talking about the health care law, or at least parts of it....If that transition is happening, though, it's still in its very early phases." Sam Baker in National Journal.

Related: Why is Arkansas Sen. Mark Pryor running on Obamacare if it doesn't poll well? Adrianna McIntyre in Vox.

20 ACA website, rollout contractors exceeded cost estimates, review finds. "The Department of Health and Human Services inspector general (IG) found that federal contracts in the rollout exceeded $1.7 billion in value. Seven companies are due to receive more than double their initial estimates, the IG report stated. The government was obligated to pay nearly $800 million for 60 contracts related to the federal marketplace as of February 2014. By that time, it had spent nearly $500 million. The IG review is perhaps the first to sketch the financial consequences of the technical problems that nearly killed HealthCare.gov and several other exchanges last fall." Elise Viebeck in The Hill.

Millions don't have to sign up for Obamacare thanks to exemptions. "Although as many as 30 million Americans will remain without health insurance by 2016, despite the best efforts of the ACA’s proponents, all but about seven million of them will be spared having to join the new system because of exemptions created by the act itself....Most of the other 20 exemptions address circumstantial situations such as homelessness, eviction, foreclosure, bankruptcy, the death of a close family member or an experience with domestic violence" Nick Madigan in Kaiser Health News and Miami Herald.

Separately, WHO wants tougher regulations on e-cigarettes. "The organization said that because there were still too many uncertainties surrounding e-cigarettes, which have been on the market for less than a decade, their use indoors should be banned 'until exhaled vapor is proven to be not harmful to bystanders.' The report also called for regulation to ensure the products contain a standard dose of nicotine, as the drug content now varies widely among manufacturers. And to stop children from picking up the habit, it said that e-cigarette sales to minors should be banned and that fruity, candy-type flavorings should be prohibited." David Jolly and Sabrina Tavernise in The New York Times.

Other health care reads:

How will we know if the Ebola experimental drugs worked? David Kroll in Forbes.

Nonprofit hospitals' had worst performance since Great Recession amid changes to health care system. Reed Abelson in The New York Times.

Federal officials order Medicaid to cover autism services. Michelle Andrews in Kaiser Health News and NPR.

Robin Williams interlude: Watch the tribute to him at the Emmy Awards.

4. A more direct and forceful way to make the case for climate policy

U.N. makes even blunter case for climate emissions action. "The report, intended to summarize and restate a string of earlier reports about climate change released over the past year, is to be unveiled in early November, after an intensive editing session in Copenhagen. A late draft was sent to the world’s governments for review this week....Using blunter, more forceful language than the reports that underpin it, the new draft highlights the urgency of the risks that are likely to be intensified by continued emissions of heat-trapping gases, primarily carbon dioxide released by the burning of fossil fuels like coal, oil and natural gas....If society wants to limit the risks to future generations, it must find the discipline to leave a vast majority of these valuable fuels in the ground, the report said." Justin Gillis in The New York Times.

More and more scientists worry the facts don't speak for themselves in convincing public. "Scientists are used to talking about climate change in facts and figures, a discussion framed around parts-per-million concentrations of carbon dioxide, millimeters of sea-level rise, and degrees of global temperatures. Joe Duggan wants them to talk about their feelings. Duggan, a masters of science communication student at the Australian National University, has set up a website hosting handwritten letters in which scientists express their fear, frustration, distress, and confusion about the growing threat of climate change and the politicization of the issue." Jason Plautz in National Journal.

Obama administration wants climate 'accord,' not 'treaty.' "Negotiators are meeting with diplomats from other countries to broker a deal to commit some of the world’s largest economies to enact laws to reduce their carbon pollution. But under the Constitution, a president may enter into a legally binding treaty only if it is approved by a two-thirds majority of the Senate. To sidestep that requirement, President Obama’s climate negotiators are devising what they call a 'politically binding' deal that would 'name and shame' countries into cutting their emissions. The deal is likely to face strong objections from Republicans on Capitol Hill and from poor countries around the world, but negotiators say it may be the only realistic path." Coral Davenport in The New York Times.

Why investors' fossil-fuel addiction is hard to kick. "A successful movement for divestment — which urges institutional investors to dump stocks in petroleum and coal companies — will require far more than dog-whistle support from the president. A new report explains why getting big money out of fossil fuels, especially big oil, is a tall order, even if a growing number of universities, cities, and churches have agreed to shift their investments in recent years. 'Fossil fuels are investor favourites for a reason. Few sectors offer the scale, liquidity, growth, and yield of these century-old businesses vital to today's economy,' states the report from Bloomberg New Energy Finance....But not all fossil fuels are alike." Ben Geman in National Journal.

Other energy/environmental reads:

Slow going for natural-gas trucks. Bob Tita in The Wall Street Journal.

U.S. to resume nuclear permits, relicensing on waste rule. Mark Chediak in Bloomberg.

Animals interlude: Elephant plays hula hoop.

5.  Some promising economic data, but what's up with housing?

Meanwhile, the economy continues showing signs of strength. "Orders for long-lasting U.S. manufactured goods posted their biggest gain on record in July on strong overseas demand for aircraft, and the underlying trend also remained firm, pointing to brisk economic growth....Outside of transportation, demand was decidedly softer....Helping bolster investors' spirits, the Conference Board said consumer confidence hit its highest level in nearly seven years in August. A gauge of households' perceptions of the labor market touched its best level since July 2008. A separate report, however, showed house price growth continued to slow in June." Lucia Mutikani in Reuters.

Charts: How home prices have slowed down, in 5 charts. Nick Timiraos in The Wall Street Journal.

Thanks to the strong data, the S&P finally closed above 2,000 for first time. "Investors were encouraged by Tuesday’s data, with the Standard & Poor’s 500-stock index closing above 2,000, and the Nasdaq and Dow Jones industrial average showing similar modest gains. A healthier job market and the recent surge in stocks, which has lifted the S.&P. 500 into record territory, has helped consumer confidence to rebound." Nelson D. Schwartz in The New York Times.

Existing home sales are up, but new home sales are down. What’s going on? "Sales of existing homes shot up in July. Sales of newly-built homes fell. Behind the numbers, however, lurked the same old story: The housing market has yet to fully recover. The Commerce Department reported Monday that new home sales dropped 2.4 percent from June to a seasonally adjusted annual rate of 412,000. Normal would be closer to 800,000....Only a few days earlier, the National Association of Realtors reported that sales of previously-built (or existing) homes jumped 2.4 percent in July to their highest level since September....This helps explain why the mix of homes available to potential buyers is totally out of whack." Dina ElBoghdady in The Washington Post.

Some economists also see price gap between new, existing homes closing. "A few economists and builders point to emerging factors....First, the number of foreclosed homes in the resale market continues to shrink, which will help push the existing-home market’s median price upward. Second, builders likely will start building less expensive homes as first-time buyers inevitably return to the market in greater numbers in light of slowly loosening mortgage-qualification standards and stronger wage growth. Meanwhile, builders increasingly will feel pressured to rein in new-home prices as they face more competition from a growing supply of newly built homes and cheaper existing homes." Kris Hudson in The Wall Street Journal.

Other economic/financial reads:

More laid-off workers are bouncing back, and fewer are taking pay cuts. Ben Leubsdorf in The Wall Street Journal.

The depressing jobs mystery America’s top labor economist aims to solve. Tim Fernholz in Quartz.

A new reason to question the official unemployment rate. David Leonhardt in The New York Times.

Star Wars interlude: Check out this rendition of the main theme on harps.

Wonkblog roundup

Tim Hortons makes more money than Burger King and Dunkin’ Donuts, combined. Roberto A. Ferdman.

Study: Couples who smoke marijuana are less likely to engage in domestic violence. Christopher Ingraham.

There’s finally someone in charge of HealthCare.gov. Jason Millman.

Gun assault injuries alone cost taxpayers almost half a billion dollars a year. Roberto A. Ferdman.

Have taxes your way: Why Burger King wants to become a Canadian citizen. Roberto A. Ferdman.

Et Cetera

Ferguson, Mo.: The poorest corner of town. Ben Casselman in FiveThirtyEight.

Federal prosecutions not easy in police shootings. Eric Tucker in the Associated Press.

Judges chide state lawyers over gay marriage bans. Michael Tarm in the Associated Press.

Texas v. Perry emerges from years of struggle over anticorruption unit. David Montgomery in The New York Times.

Drug czar approaches challenge from a different angle: As a recovering alcoholic. Katie Zezima in The Washington Post.

A seal of approval for corporate gender equality. Jena McGregor in The Washington Post.

Expect Napa quake to rattle D.C. efforts on seismic alerts. Michael Doyle in McClatchy Newspapers.

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

Wonkbook is produced with help from Michelle Williams and Ryan McCarthy.

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