Economists Who Are Really Bad At Their Jobs For $200: Who Is Kevin Hassett?

Kevin Hassett is a really, really, really bad economist. He’s so bad that he’s basically Megan McArdle’s idea of someone who is good at math. This wouldn’t be a problem if he wasn’t also the chair of the President’s Council of Economic Advisors. First Hassett made this really tone deaf remark in a TV interview:

We now know that that was only the shot, here’s the chaser:

Here’s the video if you want to see it with your own eyes and hear it with your own ears:

I’ve been hesitant to write about the shutdown, especially its effects on contractors, because I am one. But I think it is important that people realize that Hassett’s failure to be even remotely competent at his job by not accounting for the effects of contractors being out of work is actually worse than he’s now owned up to. Does anyone know, by any chance, what happens when a veteran owned or minority owned or Native American owned or Native Alaskan owned or some combination of those owned small business gets a contract award from a part of the government, say the Department of Defense, that is not shut down right now? The answer is quite simple. In order for the contract award to be finalized so that actual people waiting for start dates and on boarding dates can be issued, the Small Business Administration has to verify that the small business is indeed a small business. This is routine paperwork. Unfortunately, the Small Business Administration is currently closed because of the shut down. As a result that routine paperwork certifying that small businesses are, indeed, small businesses cannot be issued. This means that every contract award to a small business, whether owned by a veteran or a minority or a Native American or a Native Alaskan or by some combination, can’t be finalized. The people lined up to fill the positions in those contracts can’t start. And the ripples through the economy get larger.

This effects everything from new contracts for maintenance and janitorial services to food service to IT to a whole range of other technical specialties – many of them essential for national security. And it is important to remember that a lot of these companies and the people that work for them have been stretched thin over the past five years because of the combination of the Budget Control Act (doing business as the sequester), as well as the inability of the GOP majority Congress to pass a budget and regular appropriations from 2015 through 2018 or the GOP majority House to actually do its job in terms of appropriations from 2011 through 2014 because they were using the budget as leverage against President Obama. Every time the US has approached a shut down or a rolling, short term Continuing Budget Resolution (CR) is passed, it effects whether people start new contract assignments. And because of the sequester, when this happens repeatedly, contract award money for specific positions can be, and often is, clawed back to fund other needs that aren’t provided by contractors. All of these budgetary failures, from those created by the GOP majorities in the House and the Senate from 2015 through 2018 and the House GOP majority’s budgetary brinksmanship from 2011 through 2014.

The simple reality here is that nothing will happen to get Senate Majority Leader McConnell to actually function as he was the leader of one half of a co-equal branch of government until something catastrophic happens. Not even Congresswoman Ocasio-Cortez’s excellent social media skills. As I wrote yesterday, McConnell is immune to the type of pressure that she and her colleagues tried to bring to bear today. Until or unless something really bad happens, civil servants and contractors are going to continue to either have to work without pay or are going to be on furlough. That money, as well as money that should have started flowing into the economy through new contract awards to small businesses, but can’t because the Small Business Administration is closed because of the shut down, will continue to not circulate through the economy. And the failure of that money to be circulated, through mortgage and rent payments, through the purchase of groceries and clothes, through car payments, gas purchases, and paying for mass transit to get to work, for haircuts delayed, and for non-essentials like movies, the occasional dining out, or other social activities, will have a massive effect on both the macro and micro economies of the US. And those effects won’t be positive.

Open thread.



Proof of Life: Denver Meet-Up

From commentor Comrade Scotts Agenda of Rage:

Low key evening at a nice, low key microbrewery. Left to right: Scamp Dog, PsiFighter37 and moi, comrade scotts agenda of rage.

Hopefully we can pull more Denver folks out of the woodwork for another one this year.



Our goose is cooked, our reputation is shot

Now seems like a good time to start tightening the vise around Republican Senate “moderates'” heads. Nominee funds are a great way to get good candidates to oppose clowns like Susans Collins and Cory Gardner.

You know what to do


Goal Thermometer

Benny says give til it hurts.








Open Thread — Pelosi to Trump: No Grandstanding While the Secret Service Is Working Without Pay

Good for Speaker Pelosi:



Open Thread: I Got a New Ride

My old ride:


We were kind of outgrowing it, plus I am worried about an issue with a possible serious recall in the near future, so safety was becoming a concern. Trade-in the Kia Soul now while it had some real value.

I really wanted my next car to be a hybrid. Excited I found a plug-in hybrid SUV that fits all of us:

Kia Niro. 105-107 mpg (in strictly hybrid mode, it’s about 50 mpg).

Open thread until the next awful thing comes across the news.








Saying No saves money

Walid Gellad and others have a short research letter in JAMA Internal Medicine this week on the cost of prescription drugs under various payments schemes.  This team simulated the differential spending between what Medicare Part D paid for the top-50 drugs and what the Veterans Administration paid for those drugs.  The prices paid are significantly different:

Annual net Medicare Part D spending on the top 50 oral drugs ranged from $26.3 billion in 2011 to $32.5 billion in 2016 (Table). In 2016, if Medicare Part D obtained VA prices, the cost of these medications would have been $18.0 billion, representing savings of $14.4 billion, or an estimated 44%. The projected magnitude of estimated annual savings from 2011 to 2015 was similar, ranging from 38% to 50%.

The Veteran’s Administration uses aggressive formulary management.  It makes take it or leave it offers when there are multiple drugs in the same therapeutic classes.  It will not cover all drugs.  The VA will be aggressive in pre-authorization, step therapy and other medication management techniques.  The VA says “NO” a lot and it says it with great credibility.  Therefore,the VA gets good prices.

Austin Frakt and colleagues performed a related analysis in 2011 where they asked the question of how would a VA formulary work on Medicare Part D and what were the welfare implications:

In the paper, we compute the savings to the Medicare program and the loss of value (formally, consumer surplus) to beneficiaries due to tightening Part D formularies to the level found in the Veterans Health Administration (VA). (A formulary is a list of drugs covered by a health plan.) We measure formulary generosity as the percentage of the 200 most popular drugs covered. The VA’s national formulary covers 59% of the top 200 drugs while Medicare PDPs cover between 68% and 93% of those drugs, averaging about 85% covered. So, if Medicare plans looked more like the VA, a lot fewer drugs would be covered….

loss of choice is worth something, and it can be monetized using econometric techniques. Doing so, we estimate the loss of choice to be valued at $405 per beneficiary per year. Because the savings ($510 per beneficiary) exceeds the loss of value to beneficiaries ($405), they could, in principle, be made whole with $105 left over (= $510 – $405). This could be done by lowering premiums, for example…..

Both studies are useful. They quantify the power of “NO”. They also implicitly highlight the challenge of building systems that effectively say “No, not at that price” because the VA gets good pricing because they limit choice. We, as a society, are enamored with choice. We don’t like seeing the option space pre-emptively constrained.

If we want lower drug prices it means empowering large scale buyers to credibly say “No” and then hold to that “No.” It means forgoing some drugs for some conditions and some states. Otherwise having Medicare negotiate prices for drugs that everyone knows that they have to buy is just a time consuming interpretative dance routine.








Wednesday Morning Open Thread: Elections Have Consequences

Excellent, and sometimes unexpected, consequences:

Davids is a member of the Ho-Chunk Nation from Kansas. Haaland is a member of the Pueblo of Laguna from New Mexico. They joined a record number of Native women that ran for public office in 2018, according to Indian Country Today’s Mark Trahant. To say their arrival in Congress is overdue is a harsh understatement…

Congress has desperately needed more Native voices, specifically Native women. Without them, the nation’s most powerful legislative body will continue to misunderstand and mute the litany of issues that Indian Country faces. Some of the more headline-grabbing issues are tragic—scores of missing and murdered Native women, woefully underfunded health services, white parents continuing the long practice of snatching Indian children from the reservation. And some are more abstract, like the issue of climate change in the Southwestern tribes, or the sudden importance of non-voided tribal land agreements.

With such a wide array of issues to tackle, and with little support coming from the White House or the Department of the Interior, it’s fortunate that a pair of Democrats as distinctive as the new Native congresswomen are the first to emerge. Haaland and Davids come from different generations, from different states, from different life experiences, from different tribes, from different views of what a government should look like. The steps they’ll take to represent their people, let alone their own districts, are going to be just as unique as Indian Country itself…
Read more



On the Road and In Your Backyard

Good Morning All,

On The Road and In Your Backyard is a weekday feature spotlighting reader submissions. From the exotic to the familiar, please share your part of the world, whether you’re traveling or just in your locality. Share some photos and a narrative, let us see through your pictures and words. We’re so lucky each and every day to see and appreciate the world around us!

Submissions from commenters are welcome at tools.balloon-juice.com

If it’s Wednesday, it must be 🐾BillinGlendaleCA – yay!

Have a wonderful day, and enjoy the pictures!

Read more



Late Night Armchair Physicians Cynics Open Thread: Thin-Skinned


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I’d bet a store-bought cookie the old man’s on blood thinners. Although it’s quite possible his aides / Jarvanka have told him they’re ‘vitamins’, or even Murphy forbid ‘virility supplements’.

And in the working-class milieu where I grew up, this kind of ‘horsing around with the kid’ injury would mean that Barron is now big enough to physically stop the old man from bashing his mother again. But then, we didn’t have Secret Service agents hanging around 24/7…



Mitch McConnell: American Insurgent

This is Senate Majority Leader McConnell’s statement regarding Congressman Steve King of Iowa (emphasis mine):

“I have no tolerance for such positions and those who espouse these views are not supporters of American ideals and freedoms,” McConnell said in a written statement to The Washington Post. “Rep. King’s statements are unwelcome and unworthy of his elected position. If he doesn’t understand why ‘white supremacy’ is offensive, he should find another line of work.

To answer Senator McConnell’s question, perhaps this is why Congressman King doesn’t understand why ‘white supremacy’ is offensive:

This is a picture of Senator Mitch McConnell receiving an award from the John Hunt Morgan Camp of the Sons of Confederate Veterans taken in the early 1990s at the Big Springs Country Club in Louisville, Kentucky. The picture is posted on the blog of an unrepentant neo-Confederate who posted it to call Senator McConnell out for his hypocrisy (I recommend not clicking across!). Also, it is nice to see people so enthusiastic about the Confederate Navy that they fly the 2nd Confederate naval jack!

I know a lot of folks have been speculating about what Senator McConnell will or won’t do in regard to the shutdown, the President’s desire to pull out of NATO, the President’s hiding the nature, details, and any agreements reached in his conversations with Putin, the President’s tariffs and trade wars, etc. The simple reality is that Senator McConnell will continue to do what he’s been doing every day since January  21, 2009. He’ll either make a lachrymose, more in sorrow than in anger speech from his desk on the Senate floor first thing in the morning where he telegraphs the norms he will break, the traditions he’ll abandon, and the rules he’ll violate regarding whatever issue he’s speaking on and providing heartfelt advice to his Democratic colleagues about what they should and shouldn’t do or he’ll say nothing and just get about breaking those norms, abandoning those traditions, and violating those rules. And he’ll do it quietly knowing full well that it will get little to no coverage by the reporters covering politics in DC or back at home in Kentucky. And he’ll continue to do it, just as he’s done every day since January 21, 2009 when he embarked on a strategy to bring the Republicans back into the majority in the US Senate, because for the past ten years he has paid absolutely no price whatsoever for doing so. Rather he has reaped great rewards. He brought the Republicans back into the majority in the Senate. He kept significant numbers of Federal district and appellate court judgeships open so that a future Republican president could fill them instead of President Obama during whose administration these vacancies came open. He kept a Supreme Court vacancy open so that both a future Republican president could fill it instead of President Obama during whose administration the vacancy occurred and so it could be used as a political weapon during the 2016 presidential and senatorial elections. And he telegraphed during the hearings for Brett Kavanaugh that he’s gearing up to leverage another potential Supreme Court vacancy* in 2019 or 2020 as a political weapon in the 2020 presidential and senatorial elections.

As I wrote back in June 2018 in regard to the lamentations of Senators Corker, Flake, and Collins (emphasis mine):

Senate Majority Leader McConnell really isn’t a politician or like any politician who has ever served as Senate Majority or Minority Leader. Rather than view him as a politician, it is more appropriate to understand Senator McConnell as an insurgent, albeit a non-violent one. He recognizes no legitimacy but his own. When out of power he’ll do whatever is necessary using asymmetric, irregular, and/or unconventional means to achieve power. And once he achieves power he will do whatever he can to achieve his objectives to consolidate his gains as quickly as possible using any means necessary as he believes his actions are self justifying – that his achievement of power justifies his by any means necessary strategy. This is, by the way, the basic argument of the premier Italian fascist (national-syndicalist) theorist Sergio Panunzio, who delineated the fascist theories for the use of political violence and low intensity warfare in the 1920s. As a result, there is no law, rule, tradition, norm, ethic, promise, and/or deal he won’t violate or renege on. This also makes him an unreliable interlocutor and makes it impossible to negotiate with him in good faith as he doesn’t believe in good faith negotiations.

Since Senators Corker, Flake, and Collins, let alone anyone else, cannot negotiate with Senator McConnell in good faith, because Senator McConnell doesn’t do anything in good faith, if they want to get anything done, then they need to rely on their leverage as senators in a very slim Senate majority caucus to force their initiatives through. This means threatening to and/or actually caucusing with the Democrats. The last thing that Senator McConnell wants is to lose control of the Senate. Whether now because of the defections of a pair of his retiring members using it as leverage to achieve their own objectives or in the mid terms because enough voters want a check on the President to override the partisan Republican advantage in this senatorial election cycle. It is why he’s ground everything in the chamber other than handling nominations, specifically judicial nominations, to a halt. It is why he doesn’t want to do the legally required annual budgetary resolution so he can avoid having his members take tough votes before the midterms. And it is why he’s cancelled most of the August recess under the pretense that it is the only way he can move judicial nominees because of what he alleges is Democratic obstruction. Nominations that only exist because he prevented President Obama from seating almost any judicial nominees during his final two years in office. The Democratic minority has no tools to stop these nominations, regardless of what Senator McConnell says because Senator McConnell in conjunction with Senator Grassley has gotten rid of the blue slip rule and refuses to recognize Democratic senators holds on nominees. Senator McConnell’s cancellation of the August recess is really just a thinly veiled attempt to keep incumbent Democratic senators up for reelection off the campaign trail. Every Senate rule, tradition, norm, ethic, and even law (Congressional Budget Act) has been bent or stretched to breaking or just outright ignored by Senator McConnell in his quest to consolidate his power and achieve his revanchist and reactionary objectives. As an insurgent, albeit a non-violent one, Senator McConnell only understands and recognizes the application of leverage and force. As an insurgent, albeit a non-violent one, Senator McConnell only understands and recognizes the application of leverage and force. Senators Corker, Flake, and Collins have the ability to apply significant leverage and force. The question is whether or not they have the will to do so. The sad reality is the answer is almost certainly not.

Senator McConnell’s calculus, which has been his calculus since January 2009, is that if he’s quiet and boring, even if the political reporters initially cover it, they’ll soon get bored and chase something more exciting. Or something more exciting will happen and distract them.

Open thread!

* I’m expecting, provided Justice Ginsburg completes her recovery as expected and remains healthy, that the administration in conjunction with Leonard Leo from The Federalist Society and Senator McConnell will try to replicate with Justice Thomas what they did in the summer of 2018 with Justice Kennedy. Specifically, they’ll create a retirement and subsequent Supreme Court vacancy during the late summer to early fall of 2020 that the President and Republican senators can campaign for reelection on. Thereby replicating the dynamic that Senator McConnell created and the President leveraged in his campaign that it was necessary to elect him, in this case reelect him, and to reelect the GOP majority in the Senate to ensure that the Democrats don’t appoint the next Supreme Court justice, change the balance of the Supreme Court, and destroy the Constitution and thereby the United States.



Gillibrand is in

Open thread



Tuesday Evening Open Thread: It’s the McConnell Shutdown Now


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Cuz we already know why the Oval Office Squatter is pro-shutdown…



Proof of Life: Cincinnati Meet-Up

From party-planner Ohio Mom:

Here we are at the Meet up. It’s me, Ohio Mom, standing, and Ohio Dad at the end of the table, caught with his fork in his mouth.

I’ll let everyone else identify themselves in the comments.

That’s Ohio Dad waving.

It’s hard to get a good photo of lots of people eating at a long table.

***********
I believe there’s going to be a (quite small & select) Denver meetup this evening, too.

Remember, you don’t need an out-of-town visitor for a meet-up… just somebody who’ll propose a date and place, and at least one other BJ jackal to show up.



May’s Brexit deal defeated

From The Post:

Breaking news: With just 73 days to go until Britain is scheduled to leave the European Union, lawmakers voted down the withdrawal deal that had been painstakingly negotiated between Prime Minister Theresa May and the European Union. May has until Monday to come back to Parliament with a Plan B.

Optional musical accompaniment:

What happens now?



Hey Facebook, Your Standards Seem Arbitrary, Capricious, and Stupid

My facebook account is closed to the public, meaning that only people I know personally, who follow me and whom I follow, can see what I post. So basically, the only people who can see what I say and post have signed up for this shit and know full well the hot mess they are dealing with. Despite that, I am somehow run afoul of facebook’s community standards:

You know what passes facebook’s community standards? This:

That’s right- Alex Jones, despite being very publicly banned from facebook, is back in full force:

Alex Jones, the rabidly anti-LGBTQ conspiracy theorist who hosts the web-show InfoWars was banned from Facebook, YouTube, iTunes, Twitter and Vimeo last year. But he has apparently snuck back onto Facebook, and so far he’s getting away with it.

The Daily Dot reports that Jones’ InfoWars is now available on Facebook via three pages called NewsWars, InfoWars Live 24/7 and Prison Planet.TV. All of them run anti-LGBTQ content which conflates LGBTQ rights with pedophilia.

Jones has admitted that his company operates NewsWars and its related website, NewsWars.com, but he has denied personally running any of the Facebook pages.

Many of the NewsWars.com posts contain InfoWars videos, helping Facebook users connect with Jones and his anti-LGBTQ and Islamophobic views despite formally being banned on the world’s largest social network.

Fuck you Zuckerberg, you piece of shit nazi enabler. And I can say that here, because as you all know, we have no god damned standards.