"There's been a dramatic zero-point shift in the polls since Obama came out for gay marriage," tweeted Nate Silver on Monday.
A 1.5 percent swing in the polling average isn't nothing. But it's not much. And it's certainly not clear it was caused by Obama's comments on gay marriage. What we can say is that for all the hubbub, and all the column inches devoted to gaming out the political fallout, Obama's announcement led to little evident movement in the polls, and what movement there has been has been in his favor. That doesn't mean gay marriage can't matter later in the campaign -- if it increases turnout among Ohio evangelicals, or leads to much-improved superPAC fundraising for Obama, it could have an impact on the election without having a major effect in national polling -- but for now, it doesn't appear to be changing many votes.
RCP Obama vs. Romney: Obama +2.3%; 7-day change: Obama +0.9%.
RCP Obama approval: 49.0%; 7-day change: +0.7%.
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1) France and Germany are set to clash over 'euro bonds.' "France and Germany came no closer to a compromise on the thorny issue of how to revive economic growth in the euro zone after a meeting in Berlin on Monday, paving the way for a potential showdown of European Union leaders at an informal summit this week. The new government of French President François Hollande is upsetting the balance in the Franco-German relationship, threatening to block the fiscal treaty on budget discipline, and now reasserting a demand for joint euro bonds that his predecessor, Nicolas Sarkozy, had given up on in deference to German Chancellor Angela Merkel. It was widely believed that Mr. Hollande, like his predecessor, would quickly cave in to Ms. Merkel, but the French Socialist leader is proving more stubborn than expected and appears to be trying to drive a wedge between Germany and the rest of Europe in a bid to force Berlin to open its purse and do more to revive the flagging economies in weakened countries on the periphery of the euro zone." William Boston in The Wall Street Journal.
@zerohedge: "[Insert French president] set to clash with Merkel over euro bonds" - date? August 15, 2011 http://ind.pn/K69kvc
2) The Senate's student loan bill is being held up. "A bill that would extend the current student loan rate is just the latest legislation stuck in partisan limbo despite support from both parties for the overall idea...The rates for some federal student loans are slated to double from 3.4 percent to 6.8 percent if Congress does not act by July 1. Though both parties believe the bill should get done, they disagree over how to pay for it. Republicans want to take funds from the health care law, and Democrats want to close a loophole on wealthy taxpayers who classify their pay as dividends in order to avoid certain kinds of taxes. Now the parties can’t even agree on a vote schedule. Senate Democrats are open to having a vote on a House-approved bill that includes the health care funding provision, but only if Republicans agree to open debate on the underlying bill, which they already filibustered earlier this month on a 52-45 vote." Meredith Shiner in Roll Coll.
3) Only a handful of states will be ready to run their own health insurance exchanges come 2014. "When health insurance exchanges open in 2014, it is now clear that the federal government will be playing the lead, not the understudy. Many insurance experts and health policy consultants predict only a dozen or so states will be ready to run exchanges on their own -- and a few say that projection may be too sunny. Only a handful of the most militant states are likely to continue all-out resistance to federal health reform if the law is upheld -- which ironically would mean the federal government would run their exchanges. But for most states, the likely scenario is 'partnerships' in which states run some parts of these new insurance markets but the feds run many aspects that consumers will experience most directly. Thirty-four states and Washington, D.C., received exchange planning grants totaling $856 million. Only 14 of them have passed legislation authorizing an exchange, and a couple more are moving ahead under executive orders from the governor." J. Lester Feder and Jason Millman in Politico.
4) Catholic institutions filed lawsuits against the birth control mandate. "In an effort to show a unified front in their campaign against the birth control mandate, 43 Roman Catholic dioceses, schools, social service agencies and other institutions filed lawsuits in 12 federal courts on Monday, challenging the Obama administration’s rule that their employees receive coverage for contraception in their health insurance policies. The nation’s Catholic bishops, unable to reverse the ruling by prevailing on the White House or Congress, have now turned to the courts, as they warned they would. The bishops say the requirement is an unprecedented attack on religious liberty because it compels Catholic employers to provide access to services that are contrary to their religious beliefs. The mandate is part of the Obama administration’s overhaul of the health care system, which the bishops say they otherwise support." Laurie Goodstein in The New York Times.
1) RACHMAN: Breaking up the eurozone is the best way forward. "As I read the umpteenth article on the 'Grexit', a phrase from the film Marathon Man ran around my head. In this cult-thriller, Laurence Olivier plays a war criminal turned dentist who tortures Dustin Hoffman by drilling through his dental nerves without anaesthetic. As he does so, he asks repeatedly 'Is it safe?' 'Is it safe?' is the question European leaders have been asking themselves for months, as they contemplate Greece leaving the eurozone. Late last year I found myself discussing this very question with a senior European politician. He had noticed that I had written repeatedly that the eurozone was a flawed construction that was likely to collapse. If that was the case, I was asked, would it not be better to break the whole thing up now?...Yes, I do think that it would ultimately be better if the eurozone broke up. This might not involve a complete reversion to national currencies. A hard core of euro-users, centred on Germany, might survive. But the current euro will have to go." Gideon Rachman in The Financial Times.
@tylercowen: “Better an end with horror, than a horror without end.”
@mattyglesias: Best thing about a Grexit is if it happens we don't need to debate the word "Grexit" anymore. Worst thing is massive financial panic.
2) KLEIN: What Romney didn't learn at Bain is what's important. "The real problem with Romney isn’t what he did at Bain. It’s what he didn’t seem to learn from it...What he could have learned from that experience is that, just as creative destruction is important for moving an economy forward, a safety net is important for catching those who are left behind. As head of Bain, Romney fired a lot of workers who were perfectly good at their jobs, who were committed to their companies, who had families they needed to support. That was his job as head of a private-equity giant. But his job as president of the United States would also be to look out for those workers...In Massachusetts, Romney seemed to take that to heart...Romney’s national platform, however, calls for doing less for the victims of the global economy. He wants to repeal the Affordable Care Act, which would guarantee that workers would get health insurance even if they lost their jobs in, say, a private-equity led restructuring." Ezra Klein in The Washington Post.
3) SORKIN: Glass-Steagall wouldn’t have prevented the financial crisis. "A meme around Glass-Steagall has been created, repeated so often that it has almost become conventional wisdom: the repeal of Glass-Steagall led to the financial crisis of 2008. And, the thinking goes, has become almost religious for some people, that if the law were reinstated, we would avoid the next crisis. The facts -- basic facts -- just aren’t that convenient. While the repeal of Glass-Steagall has seemingly become the sine qua non of the financial crisis, it is pure historical revisionism...Here’s the key: Glass-Steagall wouldn’t have prevented the last financial crisis. And it probably wouldn’t have prevented JPMorgan’s $2 billion-plus trading loss. The loss occurred on the commercial side of the bank, not at the investment bank...Would Glass-Steagall make things slightly better? Sure. But the next time someone says that it is the ultimate solution, think again." Andrew Ross Sorkin in The New York Times.
4) BLINDER: Deficit reduction can come later. "Can we talk about the federal budget deficit?...One persistent point of confusion arises from the radically different macroeconomic effects of larger budget deficits in the short and long runs. In the short run--let's say within a year or so--a larger deficit, whether achieved by spending more or taxing less, boosts economic growth by increasing aggregate demand. It's pretty simple. If the government spends more money without raising anyone's taxes to pay the bills, that adds to total demand directly...So, as long as the government can borrow on reasonable terms, the crucial short-run question is: Does the economy need more or less demand? For the last several years, the answer has been clear: more...But don't we need to reduce the deficit--and by large amounts? Yes, we do, but that's in the long run, where the effects of larger deficits are mostly harmful to economic growth." Alan Blinder in The Wall Street Journal.
5) PONNURU: Romney shouldn't back a tax deduction for healthcare. "In 2007, George W. Bush’s administration proposed to start treating individually purchased and employer-provided coverage the same. People who got insurance either way would get a 'standard deduction' of $15,000 off their taxable income -- and they would get the same deduction whether they bought cheap or expensive insurance, restoring the incentive to economize. Romney is considering reviving Bush’s idea. Like today’s tax break for employer coverage, the standard deduction would be most valuable to people in the highest tax brackets. The uninsured typically aren’t in those brackets. As a result, Bush’s proposal would have done little to increase rates of insurance coverage. At the high end of estimates, 9 million additional people would have gotten coverage. (About 50 million Americans lack insurance.) That’s why other Republican health proposals have offered a tax credit instead of a deduction. A credit is worth the same amount of money in all tax brackets." Ramesh Ponnuru in Bloomberg.
Top long reads
Stephanie Saul finds state-funded scholarships for the poor are enriching private schools: "When the Georgia legislature passed a private school scholarship program in 2008, lawmakers promoted it as a way to give poor children the same education choices as the wealthy. The program would be supported by donations to nonprofit scholarship groups, and Georgians who contributed would receive dollar-for-dollar tax credits, up to $2,500 a couple. The intent was that money otherwise due to the Georgia treasury -- about $50 million a year -- would be used instead to help needy students escape struggling public schools. That was the idea, at least. But parents meeting at Gwinnett Christian Academy got a completely different story last year. 'A very small percentage of that money will be set aside for a needs-based scholarship fund,' Wyatt Bozeman, an administrator at the school near Atlanta, said during an informational session. 'The rest of the money will be channeled to the family that raised it.'"
Jim Morris investigates the flaws of the workplace safety system: "Early on the morning of September 3, 2009, Nicholas Adrian Revetta left the Pittsburgh, Pennsylvania, suburb of Pleasant Hills and drove 15 minutes to a job at US Steel's Clairton Plant, a soot-blackened industrial complex on the Monongahela River. He never returned home. Revetta was working as a laborer for a US Steel contractor that had employed his father, at the same plant that employed his brother. Shortly before 11:30 a.m., gas leaking from a line in the plant's Chemicals and Energy Division found an ignition source and exploded, propelling him backward into a steel column and inflicting a fatal blow to his head...Under the Occupational Safety and Health Act of 1970, American workers are entitled to 'safe and healthful' conditions. Revetta's death and the events that followed lay bare the law's limitations, showing how safety can yield to speed, how fatal accidents can have few consequences for employers, and how federal investigations can be cut short by what some call a de facto quota system."
Bluegrass interlude: The Del McCoury Band plays "1952 Vincent Black Lightning" at the Ryman Auditorium.
Got tips, additions, or comments? E-mail me.
Still to come: The FDIC sues over mortgage debt; small business tax credits are not proving popular; study time declines; he nuclear safety regulator steps down; and a puppy can't keep its head up.
'Reshoring' isn't creating many jobs. "The hand mixer line illustrates the promise--but also the limitations--of a trend that has been growing over the past two years: the 'reshoring' of some manufacturing work that was 'offshored' to low-cost producers like China in the past few decades. Producing in Asia 'is not as big of a no-brainer as it was 10 years ago,' says Mr. Good. Whirlpool is considering bringing back production of other small appliances. Yet the return of some production to the U.S. by Whirlpool and scores of other companies isn't creating a huge number of jobs. Most of the parts for the mixers--including the motors--are still made in China because Whirlpool couldn't find U.S. suppliers that would make them cheaply enough. Plastic parts for the mixers are being made in the U.S.--but partly on equipment newly purchased from China...After a 35% decline in the number of manufacturing jobs between 1998 and 2010, the tally has since risen by 489,000, or 4.3%, to 11.9 million." James Hagerty in The Wall Street Journal.
The S.E.C. is trying to do a better job with informants. "Embarrassed after missing the warning signs of the financial crisis and the Ponzi scheme of Bernard L. Madoff, the agency’s enforcement division has adopted several new -- if somewhat unconventional -- strategies to restore its credibility. The S.E.C. is taking its cue from criminal authorities, studying statistical formulas to trace connections, creating a powerful unit to cull tips and assign cases and even striking a deal with the Federal Bureau of Investigation to have agents embedded with the regulator...In one of the agency’s first efforts, Mr. Khuzami and his boss, Mary L. Schapiro, the chairwoman, sought to tear down the agency’s bureaucratic barriers. The S.E.C. had more than 70 tip lines, including e-mail and voice mail, but no central repository. To consolidate the tip system, Ms. Schapiro dispatched a top lieutenant, Stephen L. Cohen, to help create a database from scratch." Ben Protess and Azam Ahmed in The New York Times.
Rental demand is fueling signs of recovery in the property market. "Nearly six years after the US housing bubble burst, the property market is showing signs of a nascent recovery fueled by rental demand that is spurring investment in apartment buildings. For the first time in decades, it is cheaper to buy a home than rent it across much of the US. Home prices are down 35 per cent from their 2006 peak and mortgage rates are at record lows. Even so, residential vacancy rates have dropped, rents are soaring and investors are driving up prices for buildings in many US cities...This changing mindset, along with a more mobile job market and the wariness of other would-be homeowners facing high student debt loads, has helped push the national apartment vacancy rate down to 4.9 per cent in the first quarter, the lowest since late 2001, according to Reis, the research group." Shannon Bond and Anjli Raval in The Financial Times.
@lizzieohreally: I'll just throw this out there as someone who's covered economics: "Jobs created" is a sexy metric, but utterly imperfect and distortable.
Video game music interlude: Radiohead's "Kid A" in 8-bit style.
Obamacare's tax credits for small businesses aren't catching on. "Tax credits in President Obama's healthcare law aren't big enough to prompt small businesses to start offering healthcare benefits, the Government Accountability Office said Monday. Fewer businesses than expected have been taking the tax credit. The Congressional Budget Office initially estimated that the credits would total $2 billion in 2010, but instead businesses only claimed $468 million...GAO said it couldn't pin down the number of eligible businesses, but concluded interest has been limited in part because the credit is too small. It's not big enough to change the minds of companies that aren't offering healthcare coverage, GAO said...Only about 17 percent of the businesses that would otherwise be eligible for the maximum tax credit offered health insurance, according to government data cited in the GAO report. The tax credits are administered on a sliding scale, covering up to 35 percent of a company's healthcare costs." Sam Baker in The Hill.
@sarahkliff: Gruber: "My dream is of a world, twenty years from now, where someone at a townhall says 'keep the government's hands off my ACA.'"
The amount of time college students spend studying is declining. "Over the past half-century, the amount of time college students actually study -- read, write and otherwise prepare for class -- has dwindled from 24 hours a week to about 15, survey data show...Declining study time is a discomfiting truth about the vaunted U.S. higher-education system. The trend is generating debate over how much students really learn, even as colleges raise tuition every year. Some critics say colleges and their students have grown lazy. Today’s collegiate culture, they say, rewards students with high grades for minimal effort and distracts them with athletics, clubs and climbing walls on campuses that increasingly resemble resorts. Academic leaders counter that students are as busy as ever but that their attention is consumed in part by jobs they take to help make ends meet...Tradition suggests that college students should invest two hours in study for every hour of classes...Students miss that goal by half." Daniel de Vise in The Washington Post.
More liberal arts colleges are stressing career development. "Some schools are beginning to make career development a mission-critical aspect of the college experience, with everything from ramped-up career services to academic programs emphasizing real-world applications and efforts to engage faculty in practical mentoring...For decades, liberal-arts schools largely have been insulated from such questions, even as for-profit and community colleges have faced scrutiny over low graduation rates, high rates of loan defaults and whether they truly prepare students for employment in their chosen fields. And the benefits of a liberal-arts education, such as critical thinking and communication skills, are still highly valued. But with tuition increases far outpacing inflation and graduates entering a bad job market with record debt, students and parents are demanding a clearer--and quicker--return on their investment." Lauren Weber in The Wall Street Journal.
Adorable animals who are sleepy interlude: Tired dog is tired.
Natural gas prices are ticking up again. "Some investors are wagering on natural-gas prices losing their spark. Natural-gas prices have jumped as much as 44% since sinking to decade lows last month. Much of that rally had been powered by rising demand from utilities, which had taken advantage of the low prices by using more natural gas instead of coal. But the higher prices are making coal competitive once again. Coal prices are down 22% since the start of the year. Utilities are continuously fine-tuning how much coal and natural gas they're burning to generate electricity. In recent months, they've increasingly favored natural gas due to the steep drop in gas prices. Utilities keep the breakdown of their fuel use a trade secret. How utilities will respond to higher gas prices has spurred debate among investors. Some analysts and traders say the rally threatens to erode natural gas' recent gains in market share as utilities switch back to coal, and that could limit any further price increases." Ben Lefebvre and Carolyn Cui in The Wall Street Journal.
The nation's controversial nuclear safety regulator resigned. "The nation’s chief of nuclear safety announced his resignation Monday after a three-year tenure marked by debates over regulatory guidelines, praise for the U.S. response to the Japanese nuclear disaster and complaints that he had verbally abused women in the workplace. The departure of Gregory B. Jaczko, an advocate of tough safety standards at nuclear reactor sites during eight years on the Nuclear Regulatory Commission, caps almost a year of concerns about his leadership of the NRC, which he has chaired since 2009...The White House can now nominate a replacement who could be paired with Kristine L. Svinicki, a Republican NRC commissioner who requires confirmation for a new five-year term. An industry source, who asked for anonymity to preserve relationships in Congress, said that to replace Jaczko, the White House was considering one of two women with academic backgrounds in nuclear matters." Steven Mufson and Ed O'Keefe in The Washington Post.
Wonkbook is compiled and produced with help from Karl Singer and Michelle Williams.