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| Welcome to Wonkbook, Wonkblog's morning policy news primer byMax Ehrenfreund (@MaxEhrenfreud). Send comments, criticism or ideas to Wonkbook at Washpost dot com. To read more by the Wonkblog team, click here. Follow us on Twitter and Facebook. |
| Why firefighters in Memphis are calling it quits |
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When Wal-Mart said it was giving its workers a raise last month, many observerspointed to improvements in the labor market as the reason. When it's easier to find a job, people are more likely to quit the one they have, and no business can operate smoothly if it constantly has to recruit, hire and train new workers to replace the dissatisfied ones who are quitting.
That's true not just of businesses, but also of fire departments -- which makes Timothy W. Martin's report from Memphis in The Wall Street Journal especially worrying. The city council there, realizing there isn't enough money to pay the city's pension debts, voted for a less generous plan in December. In response, at least 250 police officers and firefighters quit their jobs, and the city is having trouble finding replacements.
"I can't justify me putting my life on the line, and not knowing if my family would be taken care of," a firefighter named Joseph Vaughn told Martin.
A stable pension is an important reason that many people go into public service. But these pensions are in the red across the country, and if local governments want to continue to function, they'll need to find more money, whether to close the gap or to raise pay instead. Otherwise, not only will we all be less safe, but local government won't be able to adequately fulfill its other crucial
The good news is that Memphis's public safety officers are evidently confident in their ability to find work elsewhere -- another sign that the economy is improving.
What's in Wonkbook: 1) GOP budget resolutions 2) Opinions, including Douthat on the working-class family 3) A few of America's most expensive medications, and more
Chart of the day: "A majority of Americans -- 54 percent, according to a Pew Research Center poll last year -- favor raising taxes on the wealthy to expand programs for the poor. The problem with this, from a policy standpoint, is that nearly everybody thinks 'rich people' are people who make more money than they do." Christopher Ingraham in The Washington Post.
GOP chairmen will announce the party's budget resolutions beginning Tuesday. "Republicans now in charge of Congress offer their budget blueprint this week with the pledge to balance the nation's budget within a decade and rein in major programs such as food stamps and Medicare. More pressing for many Republicans, however, is easing automatic budget cuts set to slam the military." Andrew Taylor in the Associated Press.
On entitlements, Republicans will propose giving states more control over programs. "While details of the document aren’t final, Republicans would propose turning funding for those programs into something similar to a block grant... That approach would call for the federal government to pay states a lump sum, instead of a percentage of the program’s costs. States would have more control over the program and would be responsible for footing the rest of the bill. ... Senate Republicans say they expect their budget resolution will make no changes to Social Security and will propose overall spending for Medicare, the federal health-insurance program for the elderly and disabled, at the same level proposed by the White House budget earlier this year, according to a GOP lawmaker." Kristina Peterson in The Wall Street Journal.
There's a chance the resolutions won't pass, though, due to disagreement among Republicans on spending. "The congressional push this week to secure the first Republican budget plan in nearly a decade is revealing a chasm between fiscal hawks determined to maintain strict spending caps and defense hawks who are threatening to derail any budget that does not ensure an increase for the military. 'This is a war within the Republican Party,' said Senator Lindsey Graham, Republican of South Carolina... The budget debate is coming as falling deficits have eased fiscal pressures. This month, the Congressional Budget Office updated its deficit forecast, projecting $486 billion in red ink this fiscal year, dropping to $455 billion next year. Measured against the economy, the deficit would fall from 2.7 percent of the gross domestic product to 2.4 percent, well below modern historical averages." Jonathan Weisman in The New York Times.
COOPER: What happened to the reform conservative movement? "Two years and an election later, enough has happened to draw some conclusions about the success of reform conservatism. Have they succeeded in changing the GOP's policy orientation? Nope. ... Their one halfhearted attempt to buy off the middle and upper-middle class with a new welfare program has already been adulterated with gallons of 200-proof Reaganomics, and they're still under attack from their own party for being insufficiently pro-rich. ... Republicans won the 2014 elections. That has dramatically undermined the perception that the party needs to change anything to win back the presidency in 2016. With the memory of George W. Bush's gruesome failure of a presidency fast receding in the distance, they might even be right about that." The Week.
DOUTHAT: Economics alone cannot explain the decline in marriage among the working class. "Lower-income Americans have more money, experience less poverty, and receive far more safety-net support than their grandparents ever did. Over all, material conditions have improved, not worsened, across the period when their communities have come apart. ... In a substantially poorer American past with a much thinner safety net, lower-income Americans found a way to cultivate monogamy, fidelity, sobriety and thrift to an extent that they have not in our richer, higher-spending present." The New York Times.
MATTHEWS: The American system of government will be unrecognizable in a generation. "It's hard for me to imagine a crisis whose resolution would involve an all-out coup or dissolution of democratic institutions. What's much likelier is a continuation of the executive's gradual consolidation of power until the presidency is something like an elective dictatorship. It won't happen in a big bang, and no individual step in the process will feel like a massive leap into tyranny. But compared to today, the president's powers will be almost unrecognizable."Vox.
President Reagan would have acted to mitigate global warming, writes George P. Shultz, who served as Reagan's secretary of state. During his administration, "many scientists thought the ozone layer was shrinking. There were doubters, but everyone agreed that if it happened, the result would be a catastrophe. Under these circumstances, President Ronald Reagan thought it best not to argue too much with the doubters but include them in the provision of an insurance policy. ... We all know there are those who have doubts about the problems presented by climate change. But if these doubters are wrong, the evidence is clear that the consequences, while varied, will be mostly bad, some catastrophic. So why don’t we follow Reagan’s example and take out an insurance policy?" The Washington Post.
There is no currency war. "Anyone paying attention to the financial media could easily get the impression that the world is hellbent on stealing the U.S. economic recovery. Central banks from Frankfurt to Beijing, the story goes, are pushing down their currencies' exchange rates against the dollar -- and against one another -- in a craven effort to make their exports cheaper. ... Central banks' policies affect currencies, but this isn't necessarily warfare. Much depends on the motives. Unfair manipulation involves resisting upward market pressure on the currency, as China did throughout much of the early 2000s: The aim of the policy, you could say, is to keep the foreign-exchange market out of equilibrium. Easing monetary policy to stimulate a flagging economy is quite different -- even if it gives exports a boost as a byproduct. The euro area, Japan and China all have ample justification for monetary stimulus." The editors ofBloomberg View.
Miraculously, Congress is getting ready to end the "doc fix.""An emerging deal would permanently void the formula that automatically reduces Medicare’s price controls on physicians, known as the sustainable growth rate, or SGR. These spending caps were introduced by Bill Clinton and Newt Gingrich in 1997 to supposedly contain entitlement costs, and reimbursement is scheduled to fall 18% in April. The inevitable harm to doctors and seniors is why the SGR has been overridden 18 times since 2002 with a temporary “doc fix.” But the practical result has been to disguise future spending from the federal budget and thus hide Medicare’s true cost. Far better to end this cycle of fiscal deception and replace the SGR with more honest budgeting." The editorial board of The Wall Street Journal.
The idea that the United States is a Christian country is a modern one, writes historian Kevin M. Kruse. "Throughout the 1930s and ’40s, corporate leaders marketed a new ideology that combined elements of Christianity with an anti-federal libertarianism. Powerful business lobbies like the United States Chamber of Commerce and the National Association of Manufacturers led the way, promoting this ideology’s appeal in conferences and P.R. campaigns." The New York Times.
Democrats have an advantage in the 2016 presidential election. "It's the electoral college. Yes, the somewhat arcane — yet remarkably durable — way in which presidential elections are decided tilts toward Democrats in 2016, as documented by nonpartisan political handicapper Nathan Gonzales in a recent edition of the Rothenberg & Gonzales Political Report. ... Gonzales notes that if you add up all of the states that are either 'safe' for the eventual Democratic nominee or 'favor' that nominee, you get 217 electoral votes. (A candidate needs to win 270 to be elected president.) Do the same for states safe or favoring the Republican standard-bearer, per Gonzales’s rankings, and you get just 191 electoral votes." Chris Cillizza inThe Washington Post.
Expensive drugs are increasingly out of reach. "Specialty drug spending fueled a 13 percent increase in prescription drug spending last year, the largest annual increase in the past decade, according to a report this week from pharmacy benefits manager Express Scripts. These drugs represent just 1 percent of all U.S. prescriptions, yet they made up nearly 32 percent of all drug spending in 2014, up from 28 percent in 2013. ... Insurers complain that drugmakers' prices go virtually unchecked in the United States. Drugmakers complain that insurers are selling plans that increasingly making it harder for patients to access and afford their drugs. And in the middle are patients, whose lives could depend on these advances in medicine." Jason Millman in The Washington Post.
Will the new net neutrality rules result in federal price controls on Internet access? "FCC Chairman Tom Wheeler has repeatedly insisted that his agency won't set Internet prices. When the commission met last month to approve the regulations, he promised that the FCC would not impose 'utility-style' requirements or anything that would 'pose a meaningful threat to network investment.' 'That means no rate regulation,' he vowed. ... But one of the provisions that the FCC is applying requires that all of a provider's 'charges, practices, [and] classifications' be 'just and reasonable.' That section is critical for the overall net neutrality rules. The FCC is using the 'just and reasonable' standard as the legal basis for its ban on Internet providers blocking or manipulating Internet traffic. So even though providers won't need permission to set prices, the rules allow consumers to file complaints to the FCC, including ones if they believe that some 'charges' aren't 'just and reasonable.' "Brendan Sasso in National Journal.
UPCOMING EVENT: Washington Post Live presents “Changing the Menu,” March 26 at Arena Stage. Steve Case, chairman and chief executive, Revolution & co-founder, America Online; Debra Eschmeyer, executive director, Let’s Move! Dan Kish, head chef, Panera; Agriculture Secretary Tom Vilsack and many other innovators and experts will look at food and wellness -- what we eat, how we move and how to ensure a healthy, well-fed America. Learn more about the event and register to attend.
That's true not just of businesses, but also of fire departments -- which makes Timothy W. Martin's report from Memphis in The Wall Street Journal especially worrying. The city council there, realizing there isn't enough money to pay the city's pension debts, voted for a less generous plan in December. In response, at least 250 police officers and firefighters quit their jobs, and the city is having trouble finding replacements.
"I can't justify me putting my life on the line, and not knowing if my family would be taken care of," a firefighter named Joseph Vaughn told Martin.
A stable pension is an important reason that many people go into public service. But these pensions are in the red across the country, and if local governments want to continue to function, they'll need to find more money, whether to close the gap or to raise pay instead. Otherwise, not only will we all be less safe, but local government won't be able to adequately fulfill its other crucial
The good news is that Memphis's public safety officers are evidently confident in their ability to find work elsewhere -- another sign that the economy is improving.
What's in Wonkbook: 1) GOP budget resolutions 2) Opinions, including Douthat on the working-class family 3) A few of America's most expensive medications, and more
Chart of the day: "A majority of Americans -- 54 percent, according to a Pew Research Center poll last year -- favor raising taxes on the wealthy to expand programs for the poor. The problem with this, from a policy standpoint, is that nearly everybody thinks 'rich people' are people who make more money than they do." Christopher Ingraham in The Washington Post.
1. Top story: Republicans to release budget
On entitlements, Republicans will propose giving states more control over programs. "While details of the document aren’t final, Republicans would propose turning funding for those programs into something similar to a block grant... That approach would call for the federal government to pay states a lump sum, instead of a percentage of the program’s costs. States would have more control over the program and would be responsible for footing the rest of the bill. ... Senate Republicans say they expect their budget resolution will make no changes to Social Security and will propose overall spending for Medicare, the federal health-insurance program for the elderly and disabled, at the same level proposed by the White House budget earlier this year, according to a GOP lawmaker." Kristina Peterson in The Wall Street Journal.
There's a chance the resolutions won't pass, though, due to disagreement among Republicans on spending. "The congressional push this week to secure the first Republican budget plan in nearly a decade is revealing a chasm between fiscal hawks determined to maintain strict spending caps and defense hawks who are threatening to derail any budget that does not ensure an increase for the military. 'This is a war within the Republican Party,' said Senator Lindsey Graham, Republican of South Carolina... The budget debate is coming as falling deficits have eased fiscal pressures. This month, the Congressional Budget Office updated its deficit forecast, projecting $486 billion in red ink this fiscal year, dropping to $455 billion next year. Measured against the economy, the deficit would fall from 2.7 percent of the gross domestic product to 2.4 percent, well below modern historical averages." Jonathan Weisman in The New York Times.
2. Top opinions
DOUTHAT: Economics alone cannot explain the decline in marriage among the working class. "Lower-income Americans have more money, experience less poverty, and receive far more safety-net support than their grandparents ever did. Over all, material conditions have improved, not worsened, across the period when their communities have come apart. ... In a substantially poorer American past with a much thinner safety net, lower-income Americans found a way to cultivate monogamy, fidelity, sobriety and thrift to an extent that they have not in our richer, higher-spending present." The New York Times.
MATTHEWS: The American system of government will be unrecognizable in a generation. "It's hard for me to imagine a crisis whose resolution would involve an all-out coup or dissolution of democratic institutions. What's much likelier is a continuation of the executive's gradual consolidation of power until the presidency is something like an elective dictatorship. It won't happen in a big bang, and no individual step in the process will feel like a massive leap into tyranny. But compared to today, the president's powers will be almost unrecognizable."Vox.
President Reagan would have acted to mitigate global warming, writes George P. Shultz, who served as Reagan's secretary of state. During his administration, "many scientists thought the ozone layer was shrinking. There were doubters, but everyone agreed that if it happened, the result would be a catastrophe. Under these circumstances, President Ronald Reagan thought it best not to argue too much with the doubters but include them in the provision of an insurance policy. ... We all know there are those who have doubts about the problems presented by climate change. But if these doubters are wrong, the evidence is clear that the consequences, while varied, will be mostly bad, some catastrophic. So why don’t we follow Reagan’s example and take out an insurance policy?" The Washington Post.
There is no currency war. "Anyone paying attention to the financial media could easily get the impression that the world is hellbent on stealing the U.S. economic recovery. Central banks from Frankfurt to Beijing, the story goes, are pushing down their currencies' exchange rates against the dollar -- and against one another -- in a craven effort to make their exports cheaper. ... Central banks' policies affect currencies, but this isn't necessarily warfare. Much depends on the motives. Unfair manipulation involves resisting upward market pressure on the currency, as China did throughout much of the early 2000s: The aim of the policy, you could say, is to keep the foreign-exchange market out of equilibrium. Easing monetary policy to stimulate a flagging economy is quite different -- even if it gives exports a boost as a byproduct. The euro area, Japan and China all have ample justification for monetary stimulus." The editors ofBloomberg View.
Miraculously, Congress is getting ready to end the "doc fix.""An emerging deal would permanently void the formula that automatically reduces Medicare’s price controls on physicians, known as the sustainable growth rate, or SGR. These spending caps were introduced by Bill Clinton and Newt Gingrich in 1997 to supposedly contain entitlement costs, and reimbursement is scheduled to fall 18% in April. The inevitable harm to doctors and seniors is why the SGR has been overridden 18 times since 2002 with a temporary “doc fix.” But the practical result has been to disguise future spending from the federal budget and thus hide Medicare’s true cost. Far better to end this cycle of fiscal deception and replace the SGR with more honest budgeting." The editorial board of The Wall Street Journal.
The idea that the United States is a Christian country is a modern one, writes historian Kevin M. Kruse. "Throughout the 1930s and ’40s, corporate leaders marketed a new ideology that combined elements of Christianity with an anti-federal libertarianism. Powerful business lobbies like the United States Chamber of Commerce and the National Association of Manufacturers led the way, promoting this ideology’s appeal in conferences and P.R. campaigns." The New York Times.
3. In case you missed it
Expensive drugs are increasingly out of reach. "Specialty drug spending fueled a 13 percent increase in prescription drug spending last year, the largest annual increase in the past decade, according to a report this week from pharmacy benefits manager Express Scripts. These drugs represent just 1 percent of all U.S. prescriptions, yet they made up nearly 32 percent of all drug spending in 2014, up from 28 percent in 2013. ... Insurers complain that drugmakers' prices go virtually unchecked in the United States. Drugmakers complain that insurers are selling plans that increasingly making it harder for patients to access and afford their drugs. And in the middle are patients, whose lives could depend on these advances in medicine." Jason Millman in The Washington Post.
Will the new net neutrality rules result in federal price controls on Internet access? "FCC Chairman Tom Wheeler has repeatedly insisted that his agency won't set Internet prices. When the commission met last month to approve the regulations, he promised that the FCC would not impose 'utility-style' requirements or anything that would 'pose a meaningful threat to network investment.' 'That means no rate regulation,' he vowed. ... But one of the provisions that the FCC is applying requires that all of a provider's 'charges, practices, [and] classifications' be 'just and reasonable.' That section is critical for the overall net neutrality rules. The FCC is using the 'just and reasonable' standard as the legal basis for its ban on Internet providers blocking or manipulating Internet traffic. So even though providers won't need permission to set prices, the rules allow consumers to file complaints to the FCC, including ones if they believe that some 'charges' aren't 'just and reasonable.' "Brendan Sasso in National Journal.
UPCOMING EVENT: Washington Post Live presents “Changing the Menu,” March 26 at Arena Stage. Steve Case, chairman and chief executive, Revolution & co-founder, America Online; Debra Eschmeyer, executive director, Let’s Move! Dan Kish, head chef, Panera; Agriculture Secretary Tom Vilsack and many other innovators and experts will look at food and wellness -- what we eat, how we move and how to ensure a healthy, well-fed America. Learn more about the event and register to attend.
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