Brendan Nyhan

MoveOn.org is running an ad that reinforces the myth that John McCain wants to continue the Iraq war for 100 years:

Hi, John McCain; this is Alex. He’s my first. So far, his talents include trying any new food and chasing after our dog — that, and making my heart pound every time I look at him. So, John McCain, when you said you would stay in Iraq for 100 years, were you counting on Alex? Because, if you were, you can’t have him.

As I’ve written before, McCain didn’t say what the ad suggests. Here’s the New York Times fact-check:

In several forums last January, Mr. McCain said he could envision a United States troop presence in Iraq for 100 years or more. But he did not mean to advocate a prolonged war, and he was clearly speaking in terms of a peace-keeping presence. The quotation Democrats most commonly refer to was from a town-hall-style meeting on Jan. 3 in Derry, N.H., when a voter mentioned that President Bush had spoken of “staying in Iraq for 50 years.” Mr. McCain interrupted to say, “Maybe 100.” But his comment came in the context of a broader lecture equating such a decades-long mission to American troop deployments in South Korea and Japan. He had also included a pretty big “if,” saying that such an enduring presence in Iraq, “would be fine with me as long as Americans are not being injured or harmed or wounded or killed.”

Update 6/21 8:43 AM: Also, as commenters note, John McCain won’t be president when “Alex” reaches draft age and he certainly won’t be president in 100 years.

New York Times business reporter/columnist David Leonhardt has three questions for John McCain about his tax plan, which is disturbingly reminiscent of George W. Bush’s 2000 tax proposal in its use of gimmicks and its failure to add up:

A week before Pennsylvania’s Democratic primary… John McCain traveled to Pittsburgh to remind everyone how different his economic agenda would be from theirs.

In a speech that day, he said he would abolish the dreaded alternative minimum tax. He said he would also allow companies to write off spending on new equipment more quickly than they now could, effectively reducing their taxes. Most ambitiously, he vowed to set up a simpler income tax system, one that anyone could voluntarily use instead of the current tangle. In the months since then, Mr. McCain has repeated these vows.

Fast forward to last week, when a Washington research group called the Tax Policy Center set out to estimate the budgetary effects of Mr. McCain’s and Mr. Obama’s plans, after having talked with the campaigns about the details. Almost immediately, the center’s report became the yardstick that journalists and bloggers used.

To anyone who has been following the campaign closely, however, there were some strange things in the report’s summary. The alternative minimum tax? Mr. McCain apparently no longer wants to abolish it. The write-off for corporate equipment? It exists for a few years, but then it disappears. The simple new tax system? Gone.

…Here, then, are three questions that I hope Mr. McCain will answer soon:

No. 1: Are you really going to eliminate the alternative minimum tax?

…Mr. McCain, in speeches, is perfectly clear about what he wants to do: “Abolish the A.M.T.,” as he said to a conservative group. Yet his campaign told the Tax Policy Center that “Senator McCain does not plan to repeal the individual A.M.T.”

…In the fine print of his plan, he doesn’t abolish the tax. Instead, he “patches” it, so that it would continue to apply to roughly the same number of households as it did last year — about one out of every 30. (Mr. Obama’s A.M.T. proposal isn’t so different.) The trick is that no one would actually pay the tax under the McCain plan. As Douglas Holtz-Eakin, a campaign adviser, explained to me, anyone hit by the A.M.T. could opt into Mr. McCain’s voluntary, simplified tax system, where their taxes would be lower.

Of course, no matter what it’s called, an effective elimination of the A.M.T. will cost the government a lot of money — about $60 billion a year. As a point of comparison, the entire deficit is projected to be $300 billion a year during the next president’s first term.

No. 2: Are you serious about tax simplification?

If I told you that you could choose between two different set of tax rules, I’m guessing that you would pick the one that required you to pay less in taxes. Such a system, then, would have to cost the Treasury a good bit of cash. It’s inherent.

Fred Thompson, during his brief campaign, proposed a system along these lines, and the Tax Policy Center estimated that it would have increased the deficit by some $600 billion a year. “It would be the largest tax cut ever, by a large margin,” said the center’s director, Len Burman (who, I should add, has been careful to note what his calculations do and do not include).

The McCain campaign says its proposal won’t be the same as Mr. Thompson’s, but the two certainly are similar. Mr. Holtz-Eakin is responsible for coming up with the details, he said, and he is under orders “to make it revenue neutral.” That means the plan will pay for itself — that it will include tax increases to offset the reductions. When Mr. McCain describes those increases, you’ll know he’s serious about tax simplification.

No. 3: Are you going to use gimmicks to make your numbers add up?

In 2001, President Bush signed a 10-year tax cut with a novel feature. In the final years of the cut — 2009 through 2011 — it began disappearing, making the cost look smaller than it otherwise would have. Now that those final years have arrived, however, Mr. Bush argues that Congress should restore the tax cut.

Mr. McCain agrees… Yet his campaign agenda includes one of these same sunset provisions (which wasn’t apparent until the Tax Policy Center analysis came out). The new rule on corporate deductions for equipment lasts only until 2013, when the old rule — with its higher taxes — returns. This gimmick, obviously, helps reduces the proposal’s apparent cost.

John McCain is currently running a banner ad online that puts a picture of Barack Obama and Iranian president Mahmoud Ahmadinejad side by side (screenshot of it on my site):

I’m not one of those people who demands that negative ads can’t ever use pictures of hated foreigners like Osama bin Laden, but doesn’t this seem a bit pernicious given the misperceptions about Obama being a Muslim?

How bad are things for the GOP? In a fundraising letter to the National Republican Senatorial Committee email list, Senator Orrin Hatch warns that “the coming Democratic tsunami” could lead to a filibuster-proof Democratic majority in the Senate (PDF):

For all of us, there comes a time when the choices are so stark, the risks so great, we have to take a stand. We can no longer assume someone else will save us. We have to step forward and be counted.

We face such a time today. If we don’t take a stand against the coming Democratic tsunami, the country we know and love today will be lost.

…Just this week, the Senator in charge of raising money to get Democratic Senators elected said they are going to pickup nine seats in the US Senate. Nine seats! Do you know what that would mean! That would mean they could pass every piece of their liberal agenda through the House and the Senate untouched! There would not be a tax they could not raise or a freedom they could not abridge.

…I am doing all I can to ensure the Democrats don’t have a super-majority. You need to do all you can to help.

As part of his email, Hatch misstates Democratic tax plans, saying that “I believe the Democrats when they say they plan to double our taxes.” What evidence is there to support that claim? In fact, contrary to both Hatch and John McCain, Barack Obama would cut income taxes on Americans with incomes under $75,000 while rolling back the Bush tax cuts for people with higher incomes.

Last week, I questioned Barack Obama’s statement that “over the long term we will save money” under his health care plan, which suggests that the plan actually decreases government health spending in the long term. This is not true. However, estimates for Yale political scientist Jacob Hacker’s health care plan, which is similar to Obama’s plan, show that it would reduce national health spending.

At the end of the post, I asked for feedback from blogosphere health policy wonks Ezra Klein and Jonathan Cohn. Over the weekend, Klein stepped up. The short answer is that cost savings from Obama’s plan are ambiguous:

[T]he answer to whether Obama’s plan will save us money? A definitive maybe.

First off: Barack Obama’s plan is not Jacob Hacker’s plan. In the update to his post, Nyhan mentions the Lewin analysis of Jacob Hacker’s plan, which shows that Hacker’s plan will save about $1.1 trillion over its first decade. But the mechanism for those savings are a rule Hacker places on his group market, which caps per person spending increases at the growth of GDP plus one half of one percent per year. That’s a much lower rate of growth then the system currently exhibits, and Hacker is achieving it basically by government fiat — the government will adjust reimbursement rates in order to meet the spending requirements. In other words, the group market has price controls (for a more in-depth explanation of these controls, and how the two plans differ, see this article). These controls account for approximately $1 trillion of the plan’s $1.1 trillion in savings.

Obama’s plan has a similar structure to Hacker’s plan, but it doesn’t explicitly include that provision. In an e-mail to me, Hacker argued that it could be implicit. “It really depends,” he said, “on what they end up doing with the public plan alternative. Assuming it uses Medicare-like rates and bargains for prescription drug prices, it’s going to have the leverage to bring down costs. The crucial issues are (a) how many people end up in the public plan and (b) whether the payments to private plans within the purchasing pool are tied to the average cost of the public plan. If the answer to (a) is ‘many’ and (b) is roughly as Medicare currently does it, with risk-adjusted payments based on average per capita costs, then the public plan will not only have leverage, but in addition the payments to the private plans will be contained insofar as the public plan’s costs are contained. The candidates will need to spell this out, but they certainly have not ruled it out and, indeed, the architecture of their plans is set up to facilitate it.”

Hacker’s right about that. Obama has left the cost controls ambiguous (though a more cynical observer, like me, would say he’s simply removed them), and adopted a structure that could easily support them. As a matter of policy, it’s extremely easy to see how they build upon the underlying architecture of the plan to implement effective cost controls. As a matter of politics, however, it’s much harder. I’ve little doubt that a President Obama would like his health care plan to save money. But cost controls through spending caps are a tough political sell, and if Obama can’t get to 60 votes with them, he’ll try and get to 60 votes without them.

The question then becomes whether Obama’s plan without the “hard” cost controls will save us money. Because it does have what I call “soft” cost controls — prevention programs, health information technology, a comparative effectiveness board that could, over time, help us waste less money on useless treatments. Will those provisions wipe out the spending from increased access? Probably not. Comparative effectiveness could have huge impacts down the road, but in the 10 year timeframe we’re talking about, you can’t confidently predict huge savings. These provisions will save some money, but not necessarily enough to put us in the black.

In his post, Klein also quibbles with my interpretation of Obama’s statement that “I think over the long term we will save money”:

Brendan Nyhan questions whether Barack Obama’s health care plan “would actually cause a net reduction in government health care spending.” Except that Obama doesn’t say it would cause a net reduction in government health care spending. In the quote Nyhan offers, Obama says, “I think over the long term we will save money because people will be getting regular checkups, regular screenings.” The “we” here refers to what the “we” in health care spending usually refers to: National health care spending.*

…*Nyhan has a bit of a sleight-of-hand at the end of his post. He concludes by writing, “In short, while the Hacker plan would reduce total national health spending, it’s still projected to cost the federal government approximately $50 billion more per year than the status quo.” That’s like saying the new buying system will save our business millions of dollars, but it’s still projected to cost our secondary checking account $10,000 more per year. Nyhan is leaving the impression that under Hacker, spending goes up. But it doesn’t. Slightly more of it is shifted to the government’s dime, but that’s paid for through premiums. As it is, all health spending actually comes out of our pockets. We pay for it in premiums, taxes, wages, and fees. The question, then, isn’t whether one or another of our intermediaries (Cigna, the government) is paying more, but whether we’re paying less. And under Hacker’s plan, we are. It saves money.

Klein’s statement that “The ‘we here refers to what the ‘we’ in health care spending usually refers to: National health care spending” is too broad. Policy analysts and politicians frequently refer to the projected costs of health care plans to the government rather than their net effect on national health spending. For instance, Klein himself referred to estimates of the costs to the government of both the Edwards (“$90 billion and $120 billion a year”) and Obama (“$50 billion and $65 billion a year”) plans.

It’s also strange to suggest that American politicians and policy analysts don’t refer to government actions using the pronoun “we.” Obama does. (“For what we spend in several months in Iraq, we could be providing [people without health care] with the quality, affordable health care that every American deserves.”)

Finally, at a more general level, it’s bizarre for Klein to try to rule out any discussion of the relative change in government spending associated with a health care plan. From a distributional perspective, the extent to which health care costs are paid by the government matters quite a bit. And from a fiscal policy perspective, the projected costs of a new health care plan need to be funded to avoid widening the federal budget deficit.

Washington Post editorial page editor Fred Hiatt has returned us to the morass of the tiresome debate about whether President Bush lied about the war in Iraq — the same one that bogged down Jon Stewart’s interview with Scott McClellan.

Hiatt quotes a Senate Select Committee on Intelligence report saying “the administration repeatedly presented intelligence as fact when it was unsubstantiated, contradicted or even nonexistent,” suggesting this is equivalent to saying Bush “lied,” and then points to conclusions in the report that appear to exonerate the President.

In response, Brad DeLong lists bullet points from the report that he says are “six of Bush, Cheney, and now Hiatt’s lies”:

• Statements and implications by the President and Secretary of State suggesting that Iraq and al-Qa’ida had a partnership, or that Iraq had provided al-Qa’ida with weapons training, were not substantiated by the intelligence.
• Statements by the President and the Vice President indicating that Saddam Hussein was prepared to give weapons of mass destruction to terrorist groups for attacks against the United States were contradicted by available intelligence information.
• Statements by President Bush and Vice President Cheney regarding the postwar situation in Iraq, in terms of the political, security, and economic, did not reflect the concerns and uncertainties expressed in the intelligence products.
• Statements by the President and Vice President prior to the October 2002 National Intelligence Estimate regarding Iraq’s chemical weapons production capability and activities did not reflect the intelligence community’s uncertainties….
• The Secretary of Defense’s statement that the Iraqi government operated underground WMD facilities that were not vulnerable to conventional airstrikes… was not substantiated by available intelligence information.
• The Intelligence Community did not confirm that Muhammad Atta met an Iraqi intelligence officer in Prague in 2001…

Similarly, Matthew Yglesias calls Hiatt’s editorial “preposterous” and describes the “war sales pitch” as “deeply dishonest,” “not supported by the evidence,” and a “dishonest tapestry.”

Once again, however, the problem with this debate is the way it becomes hung up on the word “lies.” As I noted in the Stewart post (among others), the word “lie” implies an outright falsehood made with conscious intent. But (a) we can never prove intent and (b) most of the Bush administration’s deceptions are exaggerations, false suggestions, and half-truths rather than outright falsehoods (as in DeLong’s list above). Why can’t we just focus on the problems with (b) rather than wasting more time on this pointless debate?

Last month, I argued that Democrats will end up deciding not to strip Joe Lieberman of his chairmanship in the next Congress for fear of causing him to switch parties. But based on Lieberman’s increasingly aggressive rhetoric, Josh Marshall is suggesting in a post and video that the Connecticut independent will be stripped of his position.

There’s certainly a strong case to be made that Lieberman has forfeited his right to any favors from the party, but I don’t think people realize how costly it will be to strip him of his chairmanship. Here’s what I wrote back in May:

The Lieberman-defenstrators out there don’t appreciate the fact that the Connecticut senator’s overall voting record in the current Congress is actually pretty close to the middle of the party. If he switches parties, that’s unlikely to continue — previous party switchers have drastically changed their voting patterns. The resulting shift would make it that much harder for a President Obama to end Republican filibusters and get his agenda passed. My guess is Democrats will realize this and let Lieberman stay in the caucus.

With Democrats projected to end up with approximately 55-57 seats in the next Senate, do they really want to raise the bar on every bill by one more vote?

TNR’s Noam Scheiber flags an interesting quote from Obama strategist David Axelrod:

“Even though Senator McCain has been on the scene for three decades, there are a lot of people who don’t know a lot about him — and there are a lot of people who don’t know about us,” said David Axelrod, Mr. Obama’s senior strategist. “Both campaigns are about to begin filling in the gaps.”

Scheiber interprets Axelrod as claiming that the “McCain brand isn’t nearly as familiar to most people as we in the political media assume,” which will help Obama because it will be “much easier (and cheaper) to create an image on a blank slate than it is to replace an existing one.”

But I don’t think this is quite right. Clearly, McCain is well-known to the public. I think Axelrod is saying that people “don’t know a lot” of negative information about him. The reason is that McCain was for some time one of the few politicians who both Democrats and Republicans praised. Until recently, he had never been the subject of serious criticism from the left at the national level. As a result, his public image was and is softer than someone who’s already withstood a great deal of criticism from the other party. (Imagine Bill Clinton in, say, 1996.)

The problem for Democrats, however, is that Obama’s never faced serious criticism from the right at any level.

Bringing you up to date on the Obama smear front, the RNC listed Barack Obama’s past profession as “street organizer” on an opposition research website; Fox News referred to Michelle Obama as Barack’s “baby mama” in an on-screen graphic; Washington Times editorial page editor Tony Blankley concluded a column on Obama by asking “Dictator or democrat? Radical or liberal? Who in the world is this man?” (via Andrew Sullivan); and Fox News contributor Dick Morris suggests that the question that plagues Obama concerns his feelings about this country: “Is he pro-American? How does he feel about white people?”

For the record, Hillary Clinton conceded the Democratic nomination five days ago.

There’s been a surge of stories describing the Obama/McCain debate over the economy as some sort of throwback to the 1980s. For instance, a day after NPR reporter Adam Hochberg described Obama’s economic plan as “heavy on working class populism,” NPR host Michele Norris framed Obama’s plan as “tax and spend liberalism” in an interview yesterday:

Now, as you well know, John McCain is also out this week talking about the economy. His campaign has already said that your “Change that works for you” campaign really amounts to change this country can’t afford. The GOP has used the same argument for decades, that tax and spend liberalism is bad for America. “Tax and spend” is almost a hyphenated phrase that’s become equivalent a dirty word. Are tax and spend policies really bad for America or is that what you’re intending to do?

Obama is probably the most liberal Democratic nominee since Michael Dukakis, but these descriptions are a caricature. His top economic advisers are establishment moderates (University of Chicago economist Austan Goolsbee and Brookings Institution economist Jason Furman); his health care plan, while ambitious by historical standards, is more cautious than Hillary Clinton’s; and his proposals to raise taxes on the wealthy largely represent a return to the status quo before President Bush took office. In addition, Norris is implicitly misrepresenting the effect of Obama’s tax plan on most Americans. As the New York Times points out this morning, he would actually reduce taxes on Americans making less than $75,000.

However, I do take issue with Obama’s claim during the Norris interview that “over the long term we will save money” under his health care plan:

John McCain doesn’t have a plan to make health care affordable and accessible to every American. I do believe that it’s important for wealthier Americans to contribute a little bit more by giving up some of the Bush tax cuts so that we can provide health care to every American. I think over the long term we will save money because people will be getting regular checkups, regular screenings. That’s something that John McCain does not do.

To me, this suggestion sounds disturbingly reminiscent of the phony supply-side claim that tax cuts pay for themselves. I’m sure that Obama’s plan would generate some savings from preventive care, but I’ve never seen a serious estimate suggesting that any plan like his would actually cause a net reduction in government health care spending. Is there any support for that idea? Over to you, Ezra Klein and Jonathan Cohn…

Update 6/12 12:57 PM: In comments, Matt points to the Lewin Group’s analysis of the Jacob Hacker health care plan that was the basis for the Democratic plans (PDF). Here’s a summary:

Last week, the Economic Policy Institute released an important analysis of Jacob Hacker’s Health Care for America (HCFA) plan by the respected health economics team at the Lewin Group. As you can read in the EPI press release, Lewin found that HCFA would cover everyone in America, while saving the U.S. economy over a trillion dollars over the next decade. And the efficiencies achievable primarily through Hacker’s public health insurance plan would save enough money that, after modest premiums from employers and individuals, the new system would cost the US government only $50 billion more than what we are paying now for a system that leaves millions uninsured or badly insured.

In short, while the Hacker plan would reduce total national health spending, it’s still projected to cost the federal government approximately $50 billion more per year than the status quo.

Update 6/12 7:29 PM: Per my point above, the progressive labor economist Jared Bernstein wishes Obama had chosen more liberal economic advisers.