U.S. Politics: It’s beginning to look a lot like Rescission

[DMC]

11 minutes ago, The Marquis de Leech said:

Tennessee is no longer winnable for Democrats - the trends are simply too brutal.

I agree Tennessee is increasingly trending red, obviously.  Just saying, that doesn't make it impossible if Trump encounters really shitty circumstances.  And it's entirely conceivable he goes into 2020 in way worse shape than he's ever been.  In which case, the GOP will be weak almost everywhere.

[DMC]

Seems like there's this underlying assumption in the recent discussion that the Dems hit their ceiling in 2018.  Um, no.  Are midterms predictive of the following presidential cycle?  No.  But that doesn't mean there's not just as much a chance Trump - and consequently the GOP - does worse than 2018 as there is a chance they do better.  In the words of an old piece of shit, that's a known unknown.

[OldGimletEye]

It seems like Judge Reed O'Connors opinion about the ACA should go down in flames.

Yet, perhaps, there is reason to worry as conservative judges will find some convoluted piece of logic to uphold it.

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What do I think will happen next with the Texas lawsuit? I’ll put my cards on the table: I really have no idea. I think one of the reasons that you see such disparate predictions for Texas v. Azar is the fact that the history of Affordable Care Act litigation has been really unpredictable. Challenges that once seemed frivolous have ended up in front of the Supreme Court in the past. One of them — the challenge to the Medicaid expansion, which I’ll dive into a bit later — was even successful.

 

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The errors of their conservative ways.

Brad Delong reminds us of the conservative foul ups a decade ago.

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I was profoundly embarrassed by and ashamed of the Swedish Nobel Committee and of being an economist when they awarded the Nobel Prize to Eugene Fama.

You see, the economists who cheerled for the Trump-McConnell-Ryan tax cut and claimed it would rapidly and permanently boost annual investment in America by 800 billion had arguments—bad arguments. The economists who condemned Benanke's quantitative easing and claimed it would soon lead to high inflation and a debased dollar had arguments—bad arguments. I do not think any of them made those bad arguments in good faith: the failure of those in either group to acknowledge that they got a big one wrong and to engage in Bayeisan updating is interesting: that silence speaks volumes.

But Fama and the others who claimed a decade ago that, while private decision to spend more boosted employment and production, public decisions to spend more—fiscal stimulus—not only would not, but could not possibly ever boost employment and production... they had no argument at all.

It is one thing, I suppose, for random Republican goobers to spew nonsense. But, they weren't the only ones. Nonsense was spewed by people holding prestigious jobs at Universities.

Fama's conservative mistakes:

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Bailouts and Stimulus Plans: There is an identity in macroeconomics... private investment [PI] must equal the sum of private savings [PS], corporate savings (retained earnings) [CS], and government savings [GS]....

(1) PI = PS + CS + GS....The problem is simple: bailouts and stimulus plans are funded by issuing more government debt.... The added debt absorbs savings that would otherwise go to private investment....stimulus plans do not add to current resources in use. They just move resources from one use to another.... I come back to these fundamental points several times below....

 

The Sad Logic of a Fiscal Stimulus: In a "fiscal stimulus," the government borrows and spends the money on investment projects or gives it away as transfer payments to people or states. The hope is that government spending will put people to work.... Unfortunately, there is a fly in the ointment.... [G]overnment infrastructure investments must be financed — more government debt. The new government debt absorbs private and corporate savings, which means private investment goes down by the same amount....

Suppose the stimulus plan takes the form of lower taxes... we can't get something for nothing this way either... lower tax receipts must be financed dollar for dollar by more government borrowing. The government gives with one hand but takes them back with the other, with no net effect on current incomes...

Friends don't let friends get influenced by Robert Lucas.

Under Fama's view of the world financial markets are complete, meaning their is an asset that can be traded under every future state of the world, and financial markets have complete participation(which is obviously not true, because people yet not born can't trade). Under this arrangement, their is one equlibrium outcome, evidently, for national income Y and no need for anyone to hold money or other liquid assets because everyone can insure for various future states of the world.

But financial markets are not complete. And there is possibility of more one level of national income, Y. Fama failed to understand that the savings equals investments identity is just an identity and not a behavioral relationship.
 

 

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This matters a lot because whenever unwanted inventories accumulate the next thing that happens is that incomes and savings drop. (i) NIPA-defined investment is equal to (ii) private savings minus the (iii) government deficit, so if (iii) changes and (ii) doesn't then (i) must change. But if that change in NIPA-defined investment is driven by unwanted inventory accumulation or unexpected inventory declines then private savings do change, and do change quickly and substantially.

Let's tell the story of how:

Suppose that it is Friday, January 2, 2009, and all of a sudden the federal government borrows some money—reducing savings—and buys some extra stuff. Savings is still equal to investment on January 2: savings went down because the government ran a bigger deficit but investment also went down because firms sold extra and so their inventories dropped.

If financial markets were complete, any firm holding excess inventories would be able to exchange them for other commodities at a predetermined rate of exchange. But you know in the real world, that doesn't just happen.

Perhaps if Fama had read Chapter 14 of the GT, he wouldn't have made so many conservative mistakes.

[Maithanet]

14 hours ago, lokisnow said:

Coupled with a strong national environment for dems, resource investment in the state for last cycle and the next cycle, that it’s an open seat and that TN is trending more dem. It’s totally plausible. It’s a reach seat, but in 2006, 2008 and 2012 democrats won lots of senate seats like this one. 

Basically we should absolutely gun hard for the seat and all the ones like it, because we win those sometimes. Given the insane levels at which republicans turned out in 2018 democrats only won 68% of all the senate seats but we were competitive in 90% of them including TN. Even a slight reduction in republican turnout or a slight increase in democrat turnout would put TN in the D column. 

TN is definitely not trending more Dem.  Here's the margins of Tennessee in the past six presidential elections:

1996:  D+2

2000:  R+4

2004:  R+14

2008:  R+15

2012:  R+20

2016:  R+26

There is a clear pattern there, and it definitely is not in Democrats favor.  Now that doesn't change your overall point, which is that Democrats should be competing for ever Senate seat, on the off chance that they get lucky with a great candidate vs a bad candidate.  But I would say that Alexander's retirement increased Democrats chances of winning the seat from ~5% to 10-12%.  Which is not nothing, but it's still a very long shot. 

[Mr. Chatywin et al.]

13 hours ago, Jace, Basilissa said:

And if the moon is made of cheese then a supermajority is in the cards!!!

Have you ever been to the moon? I didn’t think so, so you wouldn’t know if it is or isn’t made of cheese!!!!!

13 hours ago, Fragile Bird said:

‘Sighs’.

Not a great win...

Jokes aside, I caught the A block of the morning news and they said this December’s market has been the worst since The Great Depression. Talk about a bleak situation.

10 hours ago, DMC said:

Is it possible for the Dems to pick up Alexander's seat?  Sure.  Will it require very favorable conditions?  Yup.  I feel like going back to Bredesen is very uninspired.  Find someone else.

It seems to me that retreads don’t work as well for Democratic voters. We need something shiny and new.

[Maithanet]

Just now, Tywin et al. said:

It seems to me that retreads don’t work as well for Democratic voters. We need something shiny and new.

I would definitely be curious how many people in Tennessee remembered who Bredesen was before the campaign started.  My suspicion is not very many, particularly among Democrats. 

[The Marquis de Leech]

8 hours ago, DMC said:

Seems like there's this underlying assumption in the recent discussion that the Dems hit their ceiling in 2018.  Um, no.  

Oh, they're some way off their ceiling. Florida alone testifies to that, and both Georgia and Texas will become genuinely competitive within the next ten years.

Problem is, most of the red states are getting redder, as party polarisation becomes ever more rigid. Most of these places will continue to vote Republican regardless of what happens with Trump. If there's bad news about Trump, they'll blame it on the media. If there's a bad economy in 2020, they'll blame it on Pelosi and the House.

[The Marquis de Leech]

8 minutes ago, Maithanet said:

I would definitely be curious how many people in Tennessee remembered who Bredesen was before the campaign started.  My suspicion is not very many, particularly among Democrats. 

The guy left office in 2010. They knew who he was. Every county in Tennessee voted for him in 2006 too.

It's simply that the days of moderate Democrats winning red states are numbered. 

[Mr. Chatywin et al.]

17 minutes ago, Maithanet said:

I would definitely be curious how many people in Tennessee remembered who Bredesen was before the campaign started.  My suspicion is not very many, particularly among Democrats. 

Maybe younger Democrats wouldn’t remember him, but he was in office from 2003 to 2011, so I would think most did, and by all accounts he was very popular. People remember the popular and unpopular EOs. It’s the bland ones that people forget about.   

[Mr. Chatywin et al.]

2 minutes ago, The Marquis de Leech said:

The guy left office in 2010. They knew who he was. Every county in Tennessee voted for him in 2006 too.

It's simply that the days of moderate Democrats winning red states are numbered. 

I have a different theory. I think you need younger candidates, possibly younger minority candidates, to win in red states and in the South.

[Jace, Extat]

1 minute ago, Tywin et al. said:

I have a different theory. I think you need younger candidates, possibly younger minority candidates, to win in red states and in the South.

First black lady governor can't hear you because she doesn't exist.

[Mr. Chatywin et al.]

12 minutes ago, Jace, Basilissa said:

First black lady governor can't hear you because she doesn't exist.

She would hear me if not for wide spread voter suppression, so hush up moon cheese breath!

[Fez]

Certainly anything could happen in the Tennessee race, but after the strongest Democratic candidate just lost by a wide margin to one of the weakest possible Republican candidates in an extremely favorable Democratic year, I do not have high hopes. Probably the best outcome is Bill Haslam runs and wins the primary, which at least means a Republican senator willing to be moderate at least some of the time (or at least, isn't pushing the party to be even worse than it already is, the way Blackburn does).

No senate seat should be totally ignored, they are simply too important for that, but this goes way down on the list of pick-up targets; probably at number 8 or so. 

[Fez]

39 minutes ago, Tywin et al. said:

I have a different theory. I think you need younger candidates, possibly younger minority candidates, to win in red states and in the South.

Doug Jones, John Bel Edwards, Roy Cooper, and John Hood would like a word with you. Its easy to get excited for the inspirational southern Democrats, but the Democrats that actually win, when it happens, are middle-aged boring white guys.

Your theory may work in other red states, but the south is still the south (except Virginia of course).

[Maithanet]

Ducey picked McSally to fill John McCain's Senate seat after all.  So Democrats will be looking to defeat McSally a second time in 2020.  She struck me as a pretty average candidate (in terms of ability) in 2020, so winning in 2020 is definitely possible, but won't be easy.  A lot will depend on coat-tails, given how important Arizona is going to be in 2020.

[Jace, Extat]

5 minutes ago, Maithanet said:

Ducey picked McSally to fill John McCain's Senate seat after all.  So Democrats will be looking to defeat McSally a second time in 2020.  She struck me as a pretty average candidate (in terms of ability) in 2020, so winning in 2020 is definitely possible, but won't be easy.  A lot will depend on coat-tails, given how important Arizona is going to be in 2020.

That's a big vote of confidence in a second run. If she wins in 2020 she won't be a junior senator despite serving her first elected term.

[Maithanet]

Trump Foundation is shutting down.

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President Trump has agreed to shut down his embattled personal charity and give away its remaining funds amid allegations that he used it for his personal and political benefit, the New York attorney general announced Tuesday.

New York Attorney General Barbara Underwood announced that the Donald J. Trump Foundation is dissolving as her office pursues its lawsuit against the charity, Trump and his three eldest children.

The attorney general’s suit, filed in June, alleged “persistently illegal conduct” at the charity and sought to have the foundation shut down. Underwood is continuing to seek more than $2.8 million in restitution and has asked a judge to ban the Trumps temporarily from serving on the boards of other New York nonprofits.

 

Well, that's one slush fund eliminated.

[Fez]

15 minutes ago, Jace, Basilissa said:

That's a big vote of confidence in a second run. If she wins in 2020 she won't be a junior senator despite serving her first elected term.

Or a lack of confidence in the rest of the Republican field. Arizona has a surprisingly weak bench of Republican candidates, a consequence of McCain and Kyl being the senators for so long, the former governors all being old (or Democrats), strict term limits on the state legislature, high turnover in the congressional delegation (and fair maps meaning half are Democrats), and the other statewide elected positions being so under the radar (except Secretary of State, who is a Democrat).

I think Democrats have a very good shot at beating her in 2020. And even if they don't, they get another chance in 2022, since 2020 is technically just the special election to fill the rest of McCain's final term. Best case scenario for McSally is that she'll have 3 senate elections in 6 years, which just sounds exhausting.

[Jace, Extat]

3 minutes ago, Fez said:

Or a lack of confidence in the rest of the Republican field. Arizona has a surprisingly weak bench of Republican candidates, a consequence of McCain and Kyl being the senators for so long, the former governors all being old (or Democrats), strict term limits on the state legislature, high turnover in the congressional delegation (and fair maps meaning half are Democrats), and the other statewide elected positions being so under the radar (except Secretary of State, who is a Democrat).

I think Democrats have a very good shot at beating her in 2020. And even if they don't, they get another chance in 2022, since 2020 is technically just the special election to fill the rest of McCain's final term. Best case scenario for McSally is that she'll have 3 senate elections in 6 years, which just sounds exhausting.

Did you like my Van Jones impression? I'm not sure if smug aloofness translates through text.

[Fez]

7 minutes ago, Jace, Basilissa said:

Did you like my Van Jones impression? I'm not sure if smug aloofness translates through text.

Honestly, I was getting more of a Stephen A Smith vibe; he's a big fan of confidence.