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RCP Obama vs. Romney: Obama +4.0%; 7-day change: Obama +0.6%.

RCP Obama approval: 48.0%; 7-day change: +0.5%.

Intrade percent chance of Obama win: 58.0%.

Top story: How will Paul Ryan change the 2012 race?

Outlook cloudy, ask again later, say polls. "A new Washington Post-ABC News survey released Monday showed that positive views of Ryan increased by 15 percentage points after Romney named him to the ticket Saturday. But it also indicated that by Sunday, 30 percent of respondents still registered no opinion of the congressman. A new USA Today-Gallup poll found that 39 percent of Americans think Ryan is an “excellent” or “pretty good” pick for a running mate — but 42 percent say he is a “fair” or “poor” choice." Amy Gardner and Rosalind S. Helderman in The Washington Post.

Ryan's initial numbers compare poorly against past picks -- comparable to Cheney, Quayle, or Palin. "Rep. Paul Ryan starts his vice presidential campaign in not-so-great territory, with Americans rating his selection more unfavorably than any pick since at least 2000, according to a new poll...Those numbers are worse than the initial reactions to both Dick Cheney in 2000 and Sarah Palin in 2008. And they appear to be the worst since Dan Quayle in 1988 (according to a different pollster). All three Republicans wound up being very unpopular in the following years...Quayle was the only somewhat-recent vice presidential candidate to have more poll respondents rate worse than Ryan; 52 percent of likely votes in a Harris Poll rated him as a “fair” or “poor” choice." Aaron Blake in The Washington Post.

SILVER: Be skeptical of the polls for a few weeks. "I wouldn’t be too eager to consume the first few polls that we’ll get after Mr. Ryan’s selection, however. They may be a bit unsettled, and reflect a temporary burst of excitement for Mr. Romney and Mr. Ryan that may not persist. Gallup has found, for instance, that candidates typically get about a 5-point bounce in their polls after naming their running mates. But the effect seems to fade out after a week or two." Nate Silver in The New York Times.

@fivethirtyeight: If Ryan alienates seniors, working-class whites, etc etc, then the electoral math won't matter. Romney will lose pretty big.

Ryan might not move national numbers significantly in the end. "The conventional wisdom inside the Beltway is that Paul Ryan’s presence on the Republican ticket is either going to work big for Mitt Romney or backfire completely. But there’s another possibility that is perhaps even likelier: that it doesn’t much matter at all. That’s usually what happens with vice presidential picks. And it could be what happens with Ryan." Ezra Klein in The Washington Post.

Medicare is now a major election issue. "Assailing proposed changes to the retiree health plan is a time-tested line of attack, nowhere more so than here in Florida, where voters 65 and older made up 22 percent of the electorate in the 2008 presidential election. Polls show that a majority of elderly voters nationally oppose changes in Medicare or Social Security, which Mr. Ryan in the past has also proposed altering. The implications extend beyond Florida. Elderly voters are significant forces in Iowa, New Hampshire, Ohio, and Virginia and Pennsylvania, all states that could help determine the outcome of the election...Mr. Romney and Mr. Ryan signaled that they intended to go on the offensive...They are gambling that anxiety about deficits, the influence of the Tea Party movement and changing demographics will give them a chance to convince voters that the time has come to confront the rapidly mounting costs of sustaining entitlement programs." Adam Nagourney in The New York Times.

@R_Thaler: question: how is a voucher system for Medicare supposed to work for a population in which 100% have pre-existing conditions? Like Obamacare?

KLEIN: Let's bust some Medicare myths. "Ryan’s budget — which Romney has endorsed — keeps Obama’s cuts to Medicare, and both Ryan and Obama envision the same long-term spending path for Medicare. The difference between the two campaigns is not in how much they cut Medicare, but in how they cut Medicare...This brings us to the big myth of this campaign, or at least of this particular conversation: That Republicans, but not Democrats, have a plan to cut Medicare costs...Democrats believe the best way to reform Medicare is to leave the program intact but vastly strengthen its ability to pay for quality. Republicans believe the best way to reform Medicare is to fracture the system between private plans and traditional Medicare and let competition do its work." Ezra Klein in The Washington Post.

RAGO: The intellectual history of Ryan's Medicare plan. "Mr. Ryan was drawing from a rich intellectual well. Premium support was first proposed by Stanford economist Alain Enthoven in the New England Journal of Medicine in 1978. He observed that the pervasive methods of direct economic regulation of health care did not contain costs and suggested that "managed competition" would do a better job...Mr. Enthoven's reform models were the Federal Employees Health Benefits Program, created in 1959, and Calpers, the California health-insurance program for public employees. He used premium support when he designed the Stanford faculty health plan. Mr. Enthoven's ideas won some support in the Carter administration. Deregulation czar Alfred Kahn publicly endorsed them. Missouri Democrat Dick Gephardt, of all people, pushed them in Congress." Joseph Rago in The Wall Street Journal.

But Ryan's budget axe comes down hardest on Medicaid -- not Medicare. "Paul Ryan’s Medicare overhaul may be the most controversial part of his budget. But the proposed cuts to the program are not the biggest cuts in the plan...Ryan’s cuts to Medicaid are more drastic, and they start sooner: Between 2013 and 2022, it would make nearly $1.4 trillion in cuts to Medicaid that 'would almost inevitably result in dramatic reductions in coverage' as well as enrollment, according to the non-partisan Kaiser Family Foundation." Suzy Khimm in The Washington Post.

Paul Ryan seems to take his cues on monetary policy from Ayn Rand. "In 2005, Paul Ryan explained that he often looks to Ayn Rand’s novel “Atlas Shrugged” as inspiration for his views on monetary policy. 'I always go back to, you know, Francisco d’Anconia’s speech, at Bill Taggart’s wedding, on money when I think about monetary policy,' he said in a speech to the Atlas Society. So what are Ryan’s views on this front? And what do they have to do with Ayn Rand?...[Ryan] comes at monetary policy from a somewhat non-mainstream perspective. Like many other Republicans, he has repeatedly criticized Ben Bernanke’s efforts to stimulate the economy. But he has also gone further, arguing that the Federal Reserve shouldn’t be focused on reducing unemployment, period...Perhaps Ryan’s most unconventional opinion on monetary policy came in the summer of 2010, when he told Ezra Klein that the Federal Reserve should actually raise interest rates even as the U.S. economy was still struggling" Brad Plumer in The Washington Post.

@ObsoleteDogma: ...Sad that someone who fashions himself a monetary policy expert like Ryan gets it so wrong...

So is Ryan an idealist or a pragmatist? "Rep. Paul Ryan, Mitt Romney’s running mate, has been described in the past few days as a combination of two congressional ideals. Tea Party activists say he is an uncompromising budget-cutter. Romney himself says Ryan is a deal-maker, able to find common ground with Democrats. Over a complicated, contradictory career in the House, Ryan (R-Wisc.) has done plenty to prove them both wrong. For more than half his career, Ryan was a dutiful GOP foot soldier, which meant he voted for many of the budget-busting, Bush-era measures that tea partiers have come to hate...Then, in recent years, Ryan recast himself as a GOP visionary: instead of seeking compromises with Democrats, he sketched out uncompromised GOP ideals on Medicare and Social Security." David A. Fahrenthold in The Washington Post.

@ObsoleteDogma: The collision of an aging society and the welfare state means taxes will have to go up on the rich and defense spending comes down.

STOCKMAN: The Ryan budget is a 'fairy tale,' not a serious vision. "Paul D. Ryan is the most articulate and intellectually imposing Republican of the moment, but that doesn’t alter the fact that this earnest congressman from Wisconsin is preaching the same empty conservative sermon...A true agenda to reform the welfare state would require a sweeping, income-based eligibility test, which would reduce or eliminate social insurance benefits for millions of affluent retirees. Without it, there is no math that can avoid giant tax increases or vast new borrowing. Yet the supposedly courageous Ryan plan would not cut one dime over the next decade from the $1.3 trillion-per-year cost of Social Security and Medicare. Instead, it shreds the measly means-tested safety net for the vulnerable...In short, Mr. Ryan’s plan is devoid of credible math or hard policy choices." David A. Stockman in The New York Times.

@ggreenwald: For those who haven't heard: the Paul Ryan pick means we're about to have some reallly serious debates about really serious issues

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Top op-eds

BLOOMBERG: Bad immigration policy harms the economy. "Immigration reform is probably the most important issue in the U.S. on which such a consensus exists. Yes, immigration is contentious...But on a host of significant immigration policies, Republicans, Democrats and the American people understand the pressing need for change. Those areas of agreement are where our immediate focus should be...A platform for reform exists, with many members of each party prepared to sign on. First, provide green cards to foreign students earning graduate degrees in STEM fields...Second, increase the percentage of green cards awarded on the basis of economic needs...Third, create a visa specifically for entrepreneurs...Fourth, devise a guest-worker program for seasonal and labor-intensive industries." Michael R. Bloomberg in Bloomberg.

PONNURU: The gender pay gap is not the product of discrimination. "It’s a staple of feminist rhetoric: Women make less money than men because of discrimination...Here’s the truth you won’t hear: The pay gap is exaggerated, discrimination doesn’t drive it and it’s not clear that government can eliminate it -- or should even try...[Conservative economist Diana Furchtgott-Roth] points out that part of the gap reflects the fact that women, on average, work fewer hours than men...Furchtgott-Roth cites a 2005 study by economists June O’Neill and Dave O’Neill, which found that for the most part 'the gender gap is attributable to choices made by women concerning the amount of time and energy to devote to a career.' They continue: 'There is no gender gap in wages among men and women with similar family roles.'" Ramesh Ponnuru in Bloomberg.

BARRO: Online sales taxes are appropriate. "[R]equiring tax collection for online sales is the only way to ensure that sales taxes continue to be a workable way to finance government -- which is a good thing...[Conventional sales tax r]ates have been rising because the sales tax base has been shrinking...Why is the sales tax base shrinking? For most of the last few decades, the principal story has been economic shifts: Most states tax most goods and few services, and the economy increasingly consists of services. But in the last decade, online sales have become an important part of the problem." Josh Barro in Bloomberg.

FOLBRE: Public policy's horrendous accounting. "The accounting systems we currently have in place are seriously flawed. Glaring omissions related to off-balance-sheet entities contributed to major meltdowns in the private sector of the economy in 2001 and 2007. Our national income accounts are full of similar holes...Official calculations of gross domestic product ignore unpaid work, count spending on education as a form of consumption rather than investment and pretend that depletion of natural-resource stocks, pollution and global climate change are irrelevant to our economic scorecard...If only we could better account for – and correct – this problem." Nancy Folbre in The New York Times.

Top long reads

Nathaniel Popper examines high-frequency trading on Wall Street: "[A]s the speed and complexity of the markets have continued to change at a rapid pace — with trade times now measured in millionths of a second — a growing number of studies and market participants suggest that those benefits to investors have stalled or even started to reverse...The advantages of the nation’s increasingly high-speed stock market are under the microscope after a number of recent trading malfunctions underscored the risks and instability that have come with the rapid changes...As the battle to introduce more sophisticated technology continues, raising the specter of more problems like Knight’s, the diminishing returns flowing back to investors are making even longtime proponents of innovation question whether the competition to make the market faster and more efficient is now doing more harm than good."

Urban interlude: Racial segregation in major American cities, as seen by census data in this incredible set of maps.

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

Still to come: Out-of-sync debt clocks; medical progress raises ethical dilemmas; ATF considers rebranding and reorganizing; half of Alaska reserves are up for grabs in Obama admin. proposal; and a simulation of New York City in 1863.


An analysis of economic history warns of dire costs to a euro-zone breakup. "[T]his dire policy brief from Anders Åslund of the Peterson Institute for International Economics...[finds] that a dissolution of Europe’s currency union would be utterly disastrous. But he thinks that breaking up the euro would be far more disastrous than most economists assume. To explain, he takes a short jaunt through history. His paper starts by noting that there have been plenty of currency unions in Europe over the past century...But the three examples most relevant to the euro crisis, Åslund argues, are the breakup of the Habsburg Empire in Austria-Hungary in 1918, the dissolution of the Soviet Union in 1991, and the breakup of Yugoslavia. All of those were total economic fiascos." Brad Plumer in The Washington Post.

@mattyglesias: "Don't start and then lose a great power conflict" seems to be the lesson, not anything about currency unions.

Greece's economy continues to contract, keeping Europe at the brink. "Greece's economy remained deep in recession in the second quarter of the year, contracting by 6.2% on an annual basis, further complicating the coalition government's efforts to introduce the next batch of austerity measures and meet fiscal targets demanded by international creditors. With the economy stumbling through its fifth year of recession, Greece is struggling to meet deficit-reduction targets demanded by the European Union and the International Monetary Fund in exchange for its second €173 billion ($212.6 billion) bailout. The sharp contraction far exceeds the program's assumptions, suggesting it is already veering off track." Stelios Bouras and Philip Pangalos in The Wall Street Journal.

Washington's debt clocks are out-of-sync. "An informal survey of Republican debt clocks — those constantly running tallies of the depth of U.S. government debt — shows that many of them are running fast. While most clocks are known to be rough estimates and extrapolations of the pace of federal debt, some are off by as much as $200 billion, and few seem to agree with each other." Pete Kasperowicz in The Hill.

Songs in the Key of Life interlude: Stevie Wonder performing "Sir Duke".

Health Care

Advancements in treatment for premature infants raise tough ethical questions. "NICUs are the triumph of modern medicine’s investment in technology, pharmacy and know-how. The most precarious are born at the margin of life: somewhere between 23 and 26 weeks of gestation, or what’s called the limit of viability. That limit has changed dramatically over the past half century. In the 1960s, when the first NICUs opened, premature infants had a 95 percent chance of dying. Today, they have a 95 percent chance of survival...Saving lives this young is not benign. Survivors of extreme prematurity have frequent, and often severe, complications during their time in the NICU." Rahul K. Parikh in The New York Times.

Domestic Policy

The Bureau of Alcohol, Tobacco, Firearms and Explosives considers reorganization in wake of 'Fast and Furious.' "[T]he agency's boss is looking to reinvent it, and maybe even change its name...[A]cting director B. Todd Jones has to figure out what to do with it. 'We're the entity that everyone loves to hate," said the 55-year-old former Marine.'...Hence an idea discussed by top ATF officials: ditching the agency's anachronistic seven-word name and rebranding it the Violent Crime Bureau...For the ATF these days, alcohol and tobacco investigations are a tiny part of the work. In 2010, there were fewer than 100 such cases initiated, compared with more than 500 arson and bomb investigations and about 10,000 firearms cases." Evan Perez in The Wall Street Journal.

U.S. southern border patrol will employ dozens of surveillance drones used by the military. "Over the next few weeks, the military will oversee a test in south Texas to determine if a 72-foot-long, unmanned surveillance blimp—sometimes called "the floating eye" when used to spot insurgents in Afghanistan—can help find drug runners and people trying to cross illegally into the U.S. The project is part of a broader attempt by U.S. officials to establish a high-tech surveillance network along the border and find alternative uses for expensive military hardware that will be coming back from Afghanistan, along with the troops."Dion Nissenbaum in The Wall Street Journal.

The Supreme Court will consider a major challenge to affirmative action in public universities. "The case will be one of the most important of the court’s coming term...The Supreme Court said nine years ago that universities had a legitimate interest in building diverse classes and provided guidelines for administrators...Opponents of affirmative action have urged the court — now with justices more averse to race-conscious solutions — to reconsider...The Obama administration urged the Supreme Court on Monday to continue to allow universities to take race into account when assembling their student bodies, saying the government has a “vital interest” in drawing its leaders from a diverse pool of college graduates." Robert Barnes in The Washington Post.

Drought turns scrutiny to federal crop insurance. "With crop losses soaring, farmers are headed toward some $18 billion in losses, and taxpayers might foot up to $10 billion of that...That is on top of the $9 billion this year that the federal government provided farmers to help them afford crop insurance premiums...Partly because of the costs involved, the insurance program has come under scrutiny from both sides of the political aisle. Budget hawks and environmentalists alike are calling for tougher limits that they say would discourage farmers from taking risks with their finances and the land. But Congress seems to be interested in expanding, not curbing, the crop-insurance program." Alyssa A. Botelho, in The Washington Post.

To support farmers, the Obama administration made large purchases of food for aid programs. "Mr. Obama used his first stop in Iowa to announce that the Agriculture Department would purchase $170 million of pork, chicken, lamb and catfish in an attempt to alleviate the burden put on U.S. farmers from the drought. The purchases will be used in food-aid programs, the White House said...The Agriculture Department purchases will include as much as $100 million of pork products, $50 million of chicken and $10 million each of lamb and farm-raised catfish, the White House said. Mr. Obama also directed the Defense Department to encourage its vendors to speed up purchases of U.S. beef, pork and lamb, the official said." Carol E. Lee in The Wall Street Journal.

@jeffzeleny: In Iowa, Ag Sec. Vilsack hits Ryan at Obama rally: “His budget would absolutely shred the safety net for farmers. Make no mistake about it.

Former lives in miniature interlude: What New York City looked like during the Civil War draft riots.


The Obama administration put forward a plan which opens half of Alaska reserve to drilling. "The Obama administration proposed opening up 12 million acres of Alaska's 23 million-acre National Petroleum Reserve for oil and natural-gas drilling, while restricting energy production on the rest of the acreage...The areas targeted for oil and natural-gas leasing are thought to hold 550 million barrels of economically recoverable oil and 8.7 trillion cubic feet of economically recoverable natural gas, the Interior Department said." Tennille Tracy in The Wall Street Journal.

@Ben_German: Bottom line from Salazar's comments: He's making the case that if Shell doesn't get the 2012 go-ahead for Arctic drilling, it's their fault

Heat forced a nuclear reactor shutdown in Connecticut. "A reactor at the Millstone nuclear plant in Waterford, Conn., has shut down because of something that its 1960s designers never anticipated: the water in Long Island Sound was too warm to cool it. Under the reactor’s safety rules, the cooling water can be no higher than 75 degrees. On Sunday afternoon, the water’s temperature soared to 76.7 degrees, prompting the operator, Dominion Power, to order the shutdown of the 880-megawatt reactor." Matthew Wald in The New York Times.

World leaders are pushing for a change in American biofuels policy. "Leading members of the Group of 20 nations are prepared to trigger an emergency meeting to address soaring grain prices caused by the worst U.S. drought in more than half a century and poor crops from the Black Sea bread basket...[I]t must intervene through influence, perhaps urging the United States to relax its ethanol policy in response to the crisis - difficult only months before a presidential election that may be won or lost in Midwest farm states - or urging Russia not to impose an export ban, as it did two years ago...The United States uses 40 percent of its corn crop to produce ethanol, drawing criticism for using food for fuel when hunger is widespread in some poorer countries." Gus Trompiz and Nigel Hunt in Reuters.

Wonkbook is compiled and produced with help from Evan Soltas and Michelle Williams.