Economy Department with Ezra Klein

Ezra Klein: Health Care, Obama News Conference, More

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Ezra Klein
Washington Post Business Blogger
Thursday, July 23, 2009; 12:00 PM

Ezra Klein writes a Post blog about economic and domestic policy, and he was online Thursday, July 22 at noon ET to take your questions about collapsing banks, cap and trade, health care reform and pretty much anything else you can attach a chart to.

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Washington, D.C.: Looking at Drudge's blaring headline this morning, I can't help but think that this whole Skip Gates thing is going to be used as a tool by Republicans and conservatives in the media to inject racial tension back into the political atmosphere. Thoughts?

Ezra Klein: Very much. But this was, in my view, an unforced error by Obama. He's the President of the United States. He's trying to reform the health-care system and remake the energy sector. He doesn't need to comment on the specifics of Skip Gates's arrest -- particularly when he has to admit four or five times that he doesn't know the specifics. Getting really involved in this is punching below weight, and there's no benefit to it: Either Obama's intervention has no effect, or it harms and distracts him.

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New York, NY: Hey Ezra, What's the deal with the Blue Dogs blocking Health Care in the Energy and Commerce Committee? What bones do Waxman and Pelosi need to throw them to get it out of committee and when can we expect a deal?

Ezra Klein: Yesterday, in my interview with Nancy Pelosi, she seemed totally untroubled by it, and thought that the Blue Dogs were pretty much resigned to the basic features of the bill, including the public option.

But of course they still want some concessions they can spin as a victory for their caucus. The Blue Dogs want to insert certain provisions -- they've been vague about what these provisions are -- into the bill. Some of them, like the MedPAC stuff, could actually be good. Some of them, like reducing subsidies, would be bad. But this is horse-trading. It's politicians with the power to change a bill trying to change it. It's normal.

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Philadelphia: Just from a numbers standpoint, can Baucus get a piece of legislation out of the Finance Committee without Grassley or Republican support? If yes, would he be willing to if Reid or Obama told him to?

Ezra Klein: Yes and, in theory, yes. He's done this a few time this year already, and those time were primarily on health care. he did it with S-CHIP and he did it with the doctor payment fix for Medicare. Health-care reform is bigger, of course, but he's shown some flexibility in this direction.

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Seattle: Why haven't any business groups that support health insurance reform (Wal-Mart, etc.) been able to convince any Republicans to be more supportive of getting a bill passed? You would think that the more moderate members would listen to them...

Ezra Klein: A lot of people have a mental model of politicians as being first and foremost governed by special interests. That's not, in my experience, true. It's true when there are no other forces at work. But partisanship is often stronger than special interests, and the partisan incentive is to make health care unpopular and defeat it and then win seats in the next election. So that's the plan.

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New York, N.Y.: Do you think things are essentially on track and as long as Obama keeps pushing and the Congressional leadership keeps pushing, we will have health care reform, or does Obama need to pull out a real game-changer because, even though we're further along than ever, without something bold and different the effort will fall short because the institutional obstacles (as put so well by Harold Meyerson yesterday) are just too formidable?"

washingtonpost.com: Meyerson -- The Can't-Do Blue Dogs

Ezra Klein: I think they're basically on track, and absent any surprises, the bills are on their way to passage. The Blue Dogs are an annoyance, but they're not a problem. There's been no demonstrated opposition to health-care reform among them. There's just been a demonstrated desire to achieve some concrete concessions. I don't think that's abnormal and, depending on the concessions, may not even be worth worrying about.

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Unsure what it is, but likes it: RNC Chairman Steele could not, when queried in an interview, say what his health plan was, but did say he was satisified with it, just like 85% of all Americans. Do you know what poll he was citing? Are even 85% of Americans covered by health plans? I gather Steele is saying the status quo is acceptable.

Ezra Klein: That's a pretty common finding in polls. Most people are satisfied with their health insurance but worried they'll lose it, or be unable to afford it, in the future. Most people also want reform. Americans aren't very coherent on this stuff, and it accounts for the Obama administration's deep desire to let everyone -- including Michael Steele -- keep the insurance that they have.

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Denver: Hey Ezra,

What did you think of Ray's Hellburger yesterday? Can we expect a full review soon?

Ezra Klein: An incredibly delicious burger. I got the Big Punisher, and am still full. My one critique would be that the grilled onions and peppers atop are good on their own terms, but when combined with the juice from the patty, make the whole thing a bit soggy a bit quick. That messiness, of course, is part of the appeal, but I think it also takes away from the taste of the meat.

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Washington, D.C.: yup, you're right to call it an unforced error. It's being used against him. Any thoughts on why this happened, because I assume questions to him are pre-vetted?

Ezra Klein: They're not pre-vetted.

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New York, NY: An interesting counterfactual: If Obama had left Peter Orzag in charge of the CBO instead of moving him to the OMB, would we be getting more friendly estimates for the cost of health care reform out of the CBO, making it more likely to pass?

Ezra Klein: It is an interesting counterfactual, but my sense is the scores wouldn't be very different. It's not as if Elmendorf is working all this out on his calculator. The CBO's analysts are using models they've already developed. And many of those models were developed under Orszag. Which is to say they probably would have returned the same results under Orszag. And there's evidence for that view in the two health-care options volumes he put out last October (I think it was October). They weren't very cheering to reformers, even as they came from one of the leading advocates for reform.

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Washington, D.C.: After Obama's press conference last night, Bill O'Reilly and Dick Morris went on a tirade about how Democrats health plan would give the government access to individuals' medical record.

Morris said he knew "as a fact" that this would happen, especially if there's a "public plan."

Can you either debunk this claim, or (disappointingly) confirm that it's true?

Ezra Klein: It's not even clear what this would mean in practice. But no, I'm pretty sure the federal government will not have access to your medical records. I'd assume, in fact, that sharing records with, say, the White House would be literally illegal under the privacy provisions of HIPAA.

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Clifton, Va.: In the House Dems plan for health care, if you leave your current employer for any reason and then return to work you have no choice and are forced into the govt plan. You do not, as Obama spouts, keep your current plan and doctors.

If you choose no health insurance and are a legal resident of the U.S. or a U.S. citizen the U.S. govt will fine you big bucks. If you are an illegal immigrant and have no health insurance you are not fined. Great system.

My spouse and I make more than $500k large each and based on the advice of our lawyers and accountants if the Dem plan passes as is and is signed by Obama we will renounce our U.S. citizenship maintain no health insurance and pay no taxes since we are both self employed.

We want to enjoy the same bennies that our Congress has bestowed on illegal immigrants. Since we were both born in the U.S. this will result in some paperwork but it's worth not paying any taxes or Social Security. Just move my money offshore into those nice banks that don't deal with U.S. govt.

Chances the govt ever does anything or catches us slim. Renouncing your U.S. citizenship and becoming illegal is the way to go for US citizens making more than $300k. The govt agencies involved do not track this info and neither to do the states. You avoid SS and other self employment taxes and that means you keep more of what you earn. Might even create a job or two. And where is the U.S. govt going to deport me to?

Ezra Klein: Your first paragraph is wrong, but I'm more interested in your clever evasion schemes: I urge you to give them a shot. My understanding is that the IRS is particularly enamored of blindingly obvious ways to evade taxation. But do give it a try and let me know how it works out for you.

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Washington, D.C.: Two pieces of news came out today: Existing home sales increased 3.2%, the third straight monthly incline, and total jobless claims fell. What does this tell us about where the economy is going? Momentary blips? Long trends?

Ezra Klein: Not much at the moment. But if these numbers continue to improve, then they'll move from data points to trends, and that's the move we're looking for.

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New York City: If conservative, libertarian, and partisan-Republicans had chosen to engage constructively on health-care reform, would a compromise program based on the elements of Brad DeLong's "Unrealistic, Impractical, Utopian" policy have been possible? Has this been a historic missed opportunity for those who advocate a greater role for markets in health-care delivery?

Ezra Klein: Nope. I love Brad, and it's a clever thought experiment, but it has very little to do with anything in this debate, or anything that people want. What you'd have is something like the Wyden-Bennett Healthy Americans Act.

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Brooklyn, NY: Conor Friedersdorf just wrote a post for the Daily Dish entitled In Defense of Ezra Klein then knocked your writing as containing "breezy arrogance." What sort of defense is that?

Ezra Klein: It seems to have been taken down. There's been a weird backlash for the past two days after I question Greg Mankiw's increasingly inane and disengaged commentary on health-care reform. This has, apparently, shocked some people with its temerity.

But its evidence of a broader, and quite weird, dynamic in Washington, where economists are considered masters of all subjects. Mankiw doesn't study health-care reform and doesn't evince much knowledge of the actual policies being considered in the debate. Being a smart guy on other topics doesn't somehow compensate for that. As for my breezy arrogance, I certainly don't mean to come off that way, but as it stands, I'd be a lot more concerned if people were attacking me for writing things that were untrue, or ignorant of important elements of the debate I was involved in.

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Cambridge, Mass.: Any response to Yglesias's criticism today of another hackish George Will column (using the temperature spike in 1998 to quote Mark Steyn claiming that "If you're 29, there has been no global warming for your entire adult life.") If you made factually incorrect statements on your blog, would the Post require a correction? (Even though we know you're such an honest guy you'd do it yourself.) Is Will held to a different standard that lets him say whatever he wants?

washingtonpost.com: Yglasias -- Washington Post to the Rescue

Ezra Klein: I really don't know how the op-ed section works, as I'm in financial. But as the Washington Post encourages a glorious diversity of opinion in its pages, I will say that George Will is taken in by a lot of nonsense on this topic, and it's sort of a shame. Michael Gerson, who I don't agree with on many particulars, is, by contrast, very good on this topic, and George Will should read this column of his. You can oppose what Obama's doing without setting yourself in opposition to the best evidence available, or distorting what the broad trends show.

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Sterling, VA: Re: Clifton, VA - the depressing thing here is that once this genius and his wife get caught, you and I are going to get stuck with paying for their food, shelter, and, yes, medical care while they're in prison.

Ezra Klein: But we do that for illegal immigrants, too, so it's how they would want it.

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tax attorney: The US taxes the full income of both citizens and residents. If they want to avoid taxes they will have to renounce US citizenship and become residents of another country. I also believe you have to pay capital gains taxes on any property (like stocks) that will no longer be subject to US taxation because you have left.

Ezra Klein: And that's true also. Another way of putting this is that rich people are rational and they have accountants. If it were so trivial to totally evade taxes, more of them would do it.

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Point Pleasant, NJ: So what are the odds of getting health care reform out of the House and Senate by the August recess? And will they postpone the recess until it gets done?

Ezra Klein: Out of the House? Quite high. Out of the Senate? That's where things get trickier. And I think that's a real shame. The problem here, incidentally, is not the date but the recess. Right now, all the committees are working, talking, in the groove on this. To take a month off when they're nearing the finish line? It's nuts.

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European outcomes: Hi Ezra,

I'm curious about European outcomes for health care. Do superior European health care outcomes have anything to do with their healthier lifestyles? If far less of the population is obese because they walk more & eat better, their health outcomes will be more positive. I don't know how insurance for all is going to make Americans eat smarter & exercise more without a massive preventive care undertaking, which still may not be effective. Even people with insurance routinely skip annual exams that are fully paid for.

Ezra Klein: Those are definitely factors in their health outcomes, and probably bigger ones than their health care systems.

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Washington, DC: Here's a quotation from today's Washington Post:

"John Mackey, chief executive of Whole Foods, said that while his company offers coverage, he worries that an employer mandate would lead to more stringent federal rules on what employer plans must include.

He said that would drive up the cost of employer benefits, motivating companies to end their benefits and instead let employees sign up for the public insurance option, figuring that paying a penalty would be less costly. This would result in eventual domination by the public insurance plan -- something Mackey suspects is reformers' secret hope."

How do you respond to Mackey? For the record, I agree with him, as my employer has already strongly hinted that it will decline to cover us, forcing us into a public option, as the payroll penalty would less than their share of our premiums.

Ezra Klein: It's a weird argument. Right now, your employer could drop coverage for you entirely. That would mean it costs them no money, as opposed to the $750 envisioned by the payroll penalty. If they were going to do that, they'd have done that. Indeed, we have some evidence of this from Massachusetts, where there's a similar payroll penalty, and almost no deterioration in employer-based health care.

Also, no one will ever be forced into the public option. A small employer could buy into the Health Insurance Exchange, where there's a choice of public option and private options, but there's no scenario in which the public option is your only choice.

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Philadelphia, PA: I think it remains to be seen if the Gates comment was an error. I don't think it was strategic or intended, but there are two other possible outcomes to it:

1. I don't think it hurts Obama to show some authentic passion and show that he's a bit human. Sort of like the (debunked) checking out of a young woman's backside...even political opponents were pleased to see that he may be warm-blooded after all. (Alas, he's no Sarkozy...)

2. I don't know that the distraction works against him. He does the pressers presumably to show that he's in command, he gets the issue in all its complexity, he's protecting the middle class and he can be trusted. For every person easily distracted by bright shiny objects, it's better to have those people focused on bloviating and pontificating about the Gates issue than it is to have their anger getting worked up about gubment-run health care and socialized medicine. If Obama gets this thing passed before the idiots' attention clicks back in, we're all better off for it, right?

Ezra Klein: Potentially. There's also the argument that it's important for Obama to show he's not too cowed to address topics of race. That may just be important to him, as a human being.

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Washington, DC: I was surprised to read that you're in financial and not opinions. I agree that the Washington Post brand should have a mix of opinions and I think claims that you're all liberal stooges or conservative stenographers (I think it's funny how brutally you get it from both sides) tend to be loopy, and particularly unfair against the guys who spend all day digging up just-the-facts. But it strikes me as a fair criticism that the Post doesn't make a very honest attempt to identify what's opinion.

You're a liberal opinion commentator who writes about economic issues, and that's great. Why does the paper pretend there's all these important firewalls between editorial and news when they put opinion writers in the news section. It's totally fine to have opinion writers, and it's even okay to intermingle them. What's the perceived harm in being upfront about it?

Ezra Klein: Just to be clear, I'm on the opinion side of Financial, like Steve Pearlstein or Alan Sloan. Essentially, I'm an online columnist in the financial section. But my stuff is also listed under the opinion section proper. And for what it's worth, I don't think anyone ever visits my blog and misses the fact that I have a particular take on this stuff. So I think they're trying to be up-front.

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The Couburn Amendment: Ezra, What's your thought on Sen. Couburn's amendment to make all of Congress enroll in the public option, especially since it was passed by Committee when Dodd and Kennedy voted for the nominal 'poison pill'? Was this an example of the GOP being pwned?

Ezra Klein: Yep. They thought they could get the Democrats as hypocrites on this one. Instead, Kennedy and Dodd said fine -- we're happy to. So hopefully, Coburn will be in the public option before too long. Maybe he'll even like it.

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let's watch our numbers: If the 85% is true, it means 85% of people who HAVE health insurance are satisfied with it, NOT 85% of Americans. That 85% STILL doesn't tell us how many people DO NOT have and NEED health care.

Ezra Klein: No, it's actually 85 percent of Americans. Some people with no insurance are satisfied with their health-care coverage, weird as it seems. They just don't think about it much, or they're young and don't get sick, or whatever. It's a lower proportion, to be sure, but it's not as low as you might expect.

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Ezra Klein: Thanks, folks!

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