Original Dumping

With this story, we have the within-country extension of the infamous Summers Memo of 1991.

If You Ever Wanted a Reason for a Line Item Veto ...

... now you have it. From the Review and Outlook in today's WSJ:

Pension Crash Landing
May 29, 2007; Page A14

When Congress passed a broad pension reform last year prodding companies to get their retirement programs in order, it seemed too good to be true. Now we know it was.

That's the lesson of an amazing bit of corporate welfare the Senate tucked into the Iraq war supplemental last week. Last year's bill included a hard-fought political compromise: Carriers that agreed to a "hard freeze" of their pension plans would be allowed to use a higher interest rate in calculating their plans -- which would reduce their net liabilities. The idea was to discourage airlines from buying union peace by running up their pension tabs, which they might later dump on taxpayers. A few airlines, such as Northwest and Delta, took this medicine.

Their competitors, namely American and Continental, headed back to the Beltway and last week their lobbying blew apart last year's compromise. Under the Senate's backroom fix, the airlines can use a higher interest rate even if they promise higher pension benefits. The airlines claim this is about "leveling the playing field," which makes little sense because American and Continental could have accepted the same rules all along. This is about giving those two a competitive advantage over other airlines that have already agreed to play by the reform rules.

The taxpayer-backed Pension Benefit Guaranty Corp. is obliged to bail out any company that can't meet its pension obligations, so there is once again little reason for these airlines to practice any pension restraint. The PBGC conservatively estimates that this airline fixeroo will result in an additional $2 billion in underfunded pension obligations over the next 10 years.

No Senator is taking credit for this pension earmark, though we'd note that both Continental and American hail from the great state of Texas. Meanwhile, the architects of the provision were nothing if not clever; by including this in a war supplemental, they made it veto proof.

This is simply unbelievable. When even good legislation is undermined by backroom dealing, it shows a corrosive lack of seriousness on the part of the legislature itself. I think this bumper sticker sums it up pretty well.

Dartmouth Welcomes Barack Obama

Today, the College Democrats and the Rockefeller Center co-sponsored an appearance by Senator Barack Obama at Dartmouth. Here's a picture of him addressing the crowd in the courtyard outside the Center.

Some estimates put the crowd at 5-6,000. That was my unscientific estimate as well from my vantage point underneath that flag. I saw what was in the picture below, a crowd that could likely have been arranged in about 60 rows of 100 people each.

There was nothing surprising about his remarks if you have heard him speak before. His line on the war in Iraq is, "We need to be as careful getting out as we were careless getting in." On the domestic side, he covered the big three of health care, education, and the environment in a way that didn't seem to be different from other Democrats I've heard. Nothing on immigration as I recall.

In the press conference that followed, the questions were split between specific issues (mostly the war) and the process of the campaign. On the latter, it seemed as if the press wanted him to comment unduly on current polls, such as these, in which he is trailing Senator Clinton. He answered them politely. I think he should have used the Fight Club defense: The first rule of a campaign is, "Don't Talk About the Campaign." Talk about the issues. Talk about people.

On a personal level, he seemed both gracious and attentive, despite what is already a grueling schedule. I think he will continue to grow as a candidate, in just the way we would hope from retail politics in New Hampshire. I stand by what I wrote in these two earlier posts. There's only one poll that matters in the end.

UPDATES: An example of the press coverage of his appearance, in this post by John McCormick of the Chicago Tribune. The article in the campus newspaper here. Video of the event is being posted. This link is to YouTube search results. Here's a short clip that shows his appeal--none of his rivals are as compelling on this issue.

Memorial Day at Dartmouth

Last week, ABC News made the Wright choice for its Person of the Week. To read more about the inspiring work that Dartmouth President Jim Wright has been doing on behalf of severely injured veterans, see this story from The New York Times:

When he first met James Wright, the president of Dartmouth College, two years ago, Samuel Crist was in a hospital bed at the National Naval Medical Center in Bethesda, Md., recuperating from gunshot wounds from a firefight in Falluja, Iraq.

“I was pretty heavily medicated, so my memory is a little bit foggy, but he was visiting people and asking about their experiences in the war, and pushing people to get an education,” said Mr. Crist, 22, who grew up in Lafayette, La. “He said he’d been a marine, too, and he’d gone to college after he got out as a lance corporal, the same rank I separated at.”

That hospital visit changed things for both Mr. Crist and Mr. Wright: On Mr. Wright’s advice, Mr. Crist enrolled in college courses in Texas, and next fall, will transfer to Dartmouth.

Mr. Wright, 67, meanwhile, has made eight more visits to wounded veterans at Bethesda and at Walter Reed Army Medical Center in Washington, and, with the American Council on Education, started a program to provide individualized college counseling to seriously injured veterans.

We'll look forward to welcoming Mr. Crist and others to campus in the fall and, as ever, be grateful that we can honor them on Veterans' Day rather than Memorial Day.

Immigration on The Exchange

I participated in New Hampshire Public Radio's program, The Exchange, this morning to discuss the immigration bill passing through Congress. Audio will shortly be posted here.

For the details, I relied a lot on my archive and on some posts by George Borjas at his new blog. There were four questions I wanted to raise on the show:

1) Is immigration from Mexico just like any other wave of immigration?

The historical success of immigration in this country has been based on immigrants who left the old country behind, to assimilate and to blend their culture with the existing American culture. Mexico is right next door. The presumption that most immigrants will assimilate is much weaker, if not plain wrong. We should be very wary of absorbing so many immigrants, even legal immigrants, from a neighboring country whose objectives may not coincide with our own.

2) Is a guest worker program a good idea?

I regard a guest worker program as a form of second-class citizenry, and I do not support the creation of a second-class citizenry. Citizenship to me is not incidental to an economic relationship. Once we legitimize a second-class citizenry, their pleas to be elevated to first-class citizenry will be difficult to ignore, particularly given our national history of inclusion and equality. Once we legitimize frequent border crossings, we take ownership of the social problems that result from explicitly transitory populations NOT rooted to family relationships in a particular place. Show me the shining examples of guest worker programs in other large industrialized countries and I'll change my mind.

3) Are there jobs that Americans won’t do (this one is straight from an earlier post)?

There are no jobs that Americans refuse to perform. There may be jobs that Americans refuse to perform at the prevailing wage rates. This simply means that the wage rates should rise and the number of jobs should fall, until the number of jobs matches the number of people authorized to work in the country who are willing to perform them. If it turns out that with these higher prevailing wage rates, the employer can no longer operate at a profit, then the employer should cease operations--or relocate to a place where labor and other costs are sufficiently cheap as to allow a profitable business.

4) Is there a link between immigration and terrorism?

When discussing immigration from Mexico, this link appears to be tenuous at best. I have not seen any evidence that a porous southern border has contributed to greater vulnerability to an attack like 9/11. The way terrorists from 9/11 (or the recent episode at Ft. Dix) was to overstay visas--that's very different. The southern border may be contributing to law enforcement problems in the Southwest, to which I am not indifferent, but that’s a very different problem.

For the rest, you will need to listen to the podcast. Enjoy!

A Great Strides Thank You

It was a fantastic weekend in Grand Rapids for the annual Great Strides walk for Cystic Fibrosis. Here's a picture of Ally's Allies. Allison is sitting on her grandmother's lap near the middle, next to her parents, all with purple shirts on. The picture was taken at the conclusion of the walk, in Calder Plaza. My son and I are on the upper right. My wife and daughter are on the upper left.

I would like to say a heartfelt "thank you" to everyone who contributed through this appeal. I'll keep the link to Allison's page and Cystic Fibrosis in the sidebar, for those of you who are interested in how she's doing and in how the treatment of this disease is improving.

What Did Ron Paul Say?

From the Spin Room after last night's GOP "debate" in South Carolina, Byron York captures Ron Paul's reaction:

For a man who had just grabbed the spotlight in a nationally televised presidential debate, Ron Paul seemed a little, well, defensive. A few minutes after the debate ended here at the University of South Carolina, Paul, a Republican congressman from Texas, ventured into the Spin Room to talk to reporters, only to find that they wanted to know whether he really blamed the United States for the September 11 terrorist attacks.

“Who did that?” Paul snapped. “Who blamed America?”

“Well, your critics felt that you did.” “No, I blamed bad policy over 50 years that leads to anti-Americanism,” Paul said. “That’s little bit different from saying ‘blame America.’ Don’t put those words in my mouth.”

“But the policies were bad American policies?”

“We’ve had an interventionist foreign policy for 50 years that has come back to haunt us,” Paul continued. “So that’s not ‘Blame America’ — that’s demagoguing, distorting issues…That’s deceitful to say those kinds of things.”

James Joyner at OTB has the best commentary I've seen on this issue in this post. I'm not surprised at Paul's reaction to the spin, and I think the "American Idol" format is in part responsible, even though this one flowed better than the last. If this were really a "debate," Paul's point should be debated, not dismissed.

Seeing RED To Be Green

Two interesting pieces today, both concerning carbon "sinks" and their ability to alleviate global warming due to carbon release.

First up is a story on "Reducing Emissions from Deforestation:"

Tropical deforestation, which releases more than 1.5 billion metric tons of carbon to the atmosphere every year, is a major contributor to global climate change. Recognizing this, a group of forest-rich developing nations have called for a strategy to make forest preservation politically and economically attractive. The result is a two-year initiative, dubbed "Reducing Emissions from Deforestation" (RED), launched by the United Nations Framework Convention on Climate Change.

So is 1.5 billion metric tons per year a lot or a little? Continuing its summary of the study:

[T]he authors found that reducing deforestation rates by 50% over the next century will save an average of about half a billion metric tons of carbon every year. This by itself could account for as much as 12% of the total reductions needed from all carbon sources to meet the IPCC target of 450 parts per million of carbon dioxide in the atmosphere by the year 2100.

It also finds:

[C]omputer models that link climate effects to changes in the carbon cycle have predicted that tropical forests will survive and continue to act as a "sink" by absorbing carbon, provided that emissions can be kept under control . The efficiency of the tropical forest as a carbon sink might in fact diminish over time, but the authors expect that it will not disappear completely.

A second article considers the role of the oceans in absorbing carbon from the atmosphere and the reverse:

A University of Colorado at Boulder-led research team tracing the origin of a large carbon dioxide increase in Earth's atmosphere at the end of the last ice age has detected two ancient "burps" that originated from the deepest parts of the oceans.

The new study indicated carbon that had built up in the oceans over millennia was released in two big pulses, one about 18,000 years ago and one 13,000 years ago, said Thomas Marchitto and Scott Lehman of CU-Boulder's Institute of Arctic and Alpine Research, who jointly led the study. While scientists had long known as much as 600 billion metric tons of carbon were released into the atmosphere after the last ice age, the new study is the first to clearly track CO2 from the deep ocean to the upper ocean and atmosphere and should help scientists better understand natural CO2 cycles and possible impacts of human-caused climate change.

As a non-specialist, it does seem like the public debate about global warming seems to focus quite a lot on how much carbon is introduced into the atmosphere, rather than how much is taken out.

Where's Your Brain?

If you ever wondered whether there was a place in the online world where the use of Google was prohibited, I have a candidate for you. How else would we politely explain Matt Stoller's post at MyDD, "Where's Your Core?" in which he refers to Jeff Liebman as a "Cato-infused nut?"

At issue is Jeff's position as one of Barack Obama's top economic advisors and his status as a co-author of the LMS plan to reform Social Security. Stoller quotes a Bloomberg article as follows:

Liebman, an expert on Social Security, isn't easily pigeon- holed either. He has supported partial privatization of the government-run retirement system, an idea that's anathema to many Democrats and bears a similarity to a proposal for personal investment accounts that Bush promoted, then dropped in 2005.

``Liebman has been to open to private accounts and most people in town would say he's a moderate supporter of them,'' said Michael Tanner, a Social Security expert at the Cato Institute in Washington, a research organization in Washington that advocates free markets and often backs Republicans.

In a 2005 policy paper Liebman, along with Andrew Samwick of Dartmouth College in Hanover, New Hampshire, and Maya MacGuineas, a former aide to Senator John McCain, advocated a mix of benefit cuts, tax increases and mandatory personal accounts to shore up the system, which will begin paying more in benefits than it takes in through taxes by 2017 under current actuarial estimates.

Obama has called Social Security's problems ``real but manageable'' and has pledged to preserve what he's called the ``essential character'' of the pension program.

If they allowed the use of Google at MyDD, then Stoller might have typed in "jeffrey liebman" "social security" and hit return. The first link would be to this description of the LMS plan, the first paragraph of which is:

The three of us – former aides to President Clinton, Senator McCain, and President Bush – did an experiment to see if we could develop a reform plan that we could all support. The Liebman-MacGuineas-Samwick (LMS) plan demonstrates the types of compromises that can help policy makers from across the political spectrum agree on a Social Security reform plan. The plan achieves sustainable solvency through progressive changes to taxes and benefits, introduces mandatory personal accounts, and specifies important details that are often left unaddressed in other reform plans. The plan also illustrates that a compromise plan can contain sensible but politically unpopular options (such as raising retirement ages or mandating that account balances be converted to annuities upon retirement) -- options that could realistically emerge from a bipartisan negotiating process, but which are rarely contained in reform proposals put out by Democrats or Republicans alone because of the political risk they present.

It's hard to see what's so inflammatory about that. If I had to guess, it's either "bipartisan negotiating," "compromise plan," or "personal accounts." Let's give Mr. Stoller the benefit of the doubt and assume he understands that the first two are essential to getting any substantive public policy implemented. So it must be those "personal accounts."

Where oh where could Mr. Stoller find the answer to his conundrum of how a top advisor to Senator Obama could support such things? This is where that Google thing helps again. Mr. Stoller could click on the second link in the search, in which he would find the following excerpt from an interview with Jeff:

Q: Why are personal retirement accounts such an important element to the Social Security system as we move forward?

Liebman: The benefit of having personal retirement accounts in the plan is that if we’re going to spread the burden across generations and start putting some extra revenue into the system now, we need to have a way to save that money so that it doesn’t get diverted to other purposes, as the current Social Security surplus often does. If you bring in new revenue but put all of the net new revenue into personal retirement accounts, then you have a way to spread the burden across even current workers in terms of making extra contributions today, but to do so in a way that you can really be sure is going to be contributing to people’s retirement incomes in the future.

Yes, that's a very sinister explanation--you cannot reliably prefund without personal accounts. If Mr. Stoller would like to take the opposite position--that, for example, President Bush's budget policies have not spent the Social Security surpluses during his time in office--he's welcome to do so.

I don't know how Senator Obama would fare as President, but it seems pretty clear that he's better off with Liebman as an advisor than Stoller as a supporter. As I wrote regarding some earlier criticism of the LMS plan, "If you fancy yourself a liberal, and if your coalition doesn't extend far enough to the right to include Jeff Liebman, then you have relegated yourself to political irrelevance."

Normally, this is the part of the post where I would suggest that we raise some money to help Mr. Stoller afford a decent search engine. But search engines are free and improving the quality of the posts at MyDD may be impossible. Making progress against Cystic Fibrosis is neither. The pledge drive is still on. You can support our team at Great Strides or make donations directly to the Cystic Fibrosis Foundation in honor of Mother's Day.

Innovations in Distance Grandparenting

Jennifer 8. Lee reports in today's New York Times on "The Incredible Flying Granny Nanny," with examples of grandmothers who commute by airplane on a weekly basis to look after their grandchildren while both parents are at work. Here's one example:

Terri P. Tepper of Barrington, Ill., made a similar trek every week for a year to help care for her granddaughter so that her daughter could pursue her career. Beginning in 2001, Ms. Tepper flew to New York on Sundays and returned to Chicago on Thursdays.

“It was cheaper than getting a nanny,” said Ms. Tepper, 64. The round-trip tickets, which her daughter paid for, cost between $190 and $230. “I actually saved them a lot of money,” Ms. Tepper said. Her daughter later made partner in her consulting firm.

It's fascinating to see how relative prices can drive behavior here. The article has the economics right, but I think it gets the sociology and history wrong, in the following passages (with my emphasis):

Even at a time when grandparents are more involved than ever in the lives of their children and grandchildren, the efforts of Mrs. Kim and Ms. Tepper are extraordinary. But many grandparents these days are making extreme efforts to help their children bridge the work-life divide.

[...]

Intercity commuting is just one way they provide that help. Grandparents are also taking time off from work, retiring early, moving to the United States from overseas or selling their home to be near grandchildren.

The greater involvement results from a confluence of factors, including the financial burdens of child care and anxiety over the quality of care. But most notably it is influenced by a generation of grandparents who have the time and the financial wherewithal to pitch in.

“This is the first generation where we have so many older people living long enough, being healthy enough and being affluent enough to provide these services on a large scale” since women entered the workplace in large numbers, Dr. Cherlin said.

While it is true that more grandparents are living to old ages and are more affluent than earlier generations of grandparents, it is also true that parents are having their first children later in life and are having fewer children than in earlier generations. (The latter effect is compounded, since it is true of both the parents' generation and the grandchildren's generation.) That generates less opportunity for interactions between grandparents and grandchildren. In addition, the children and grandchildren are often living further away from the grandparents than in prior generations. The article is motivated by the unusual expenses that some families are incurring to recreate what used to occur for free.

In prior generations, the grandparents were needed to help the non-working parent take care of a larger number of young kids. Now, the grandparents are stepping in to take care of one young kid while both parents work. It is not the least bit clear to me that longevity and affluence trump fertility and proximity in this comparison, but I'd be curious to know what others think.

The Cystic Fibrosis pledge drive is still on. If Great Strides is not your thing, how about donations in honor of Mother's Day?

Great Strides for Cystic Fibrosis

In what is now an annual event in the Samwick household, the four of us make a trip to Grand Rapids, Michigan, to participate in the Great Strides walk for Cystic Fibrosis. CF is a devastating genetic disease that affects tens of thousands of children and young adults in the United States. Research and care supported by the Cystic Fibrosis Foundation are making a huge difference in extending the quality of life for those with CF. Those of you who conduct or follow the health outcomes literature, or who are curious about how to improve medical treatment in this country, will find this article in The New Yorker from 2004 to be of interest as well.

We walk for the Woodhouse family, dear friends whose daughter Allison has battled this disease every day since birth (and even before). We've learned a lot about courage from her story. If you would like to support us in our efforts to raise money to help children and families like them, then please make a pledge here.

Race and Performance in the NBA

The New York Times article this week about the study of racial bias in NBA officiating by Joseph Price and Justin Wolfers generated quite a bit of commentary. What is amazing is how little people understand, or are willing to understand, about statistics. Here's what the authors claim in the abstract of the study:

We find that--even conditioning on player and referee fixed effects (and specific game fixed effects)--that more personal fouls are awarded against players when they are officiated by an opposite-race officiating crew than when officiated by an own-race refereeing crew.

Much of the reaction among sportswriters has been to take the authors to task for calling the refs racist. (See Mike Wise in his column in Thursday's Washington Post and Kevin Hench at FoxSports.) Having taken a look at the study myself, I am surprised that those who make a living based on the sport would be so dismissive of the result. The main result of the paper is that the foul rate (fouls called per 48 minutes played) increases for black players when the racial composition of the three-person crew of referees goes from black to white. (See Table 4 and the discussion on page 8.) Any honest sportswriter should hold the NBA accountable for the result--why are the outcomes for fouls different across different racial configurations of refs and players?

It is very difficult to posit an explanation for these results that would attribute them to something other than race. First, no one disputes the NBA's claim that it does not assign referees to games based on their race or the racial composition of the two teams. (See page 4 and Table 1 of the study for discussion and evidence.) With (conditionally) random assignment, and the fact that the explanatory variables are fixed characteristics of people (i.e., race), we have the conditions for a clinical trial here, where "controlling" for possibly confounding factors is not likely to be important. Second, the authors do in fact control for a number of "fixed effects," exploiting the fact that their dataset is a panel consisting of a limited number of individuals observed in numerous interactions. This includes characteristics of the player and the refs that don't change over time. As the authors note, the most comprehensive results "are identified only off the differential propensity of teammates to earn extra fouls when the refereeing crew is of the opposite race."

Having said that, I think the authors soft-pedal one possible explanation of the results that would exonerate the refs. The following passage appears on pages 12-13:

The fourth point speaks to a relatively subtle interpretation issue: while we document a correlation between a player’s foul rate and the race of the referee, this may reflect the players responding to the race of the referees, rather than the referees policing opposite-race players more aggressively. Strategic responses by players would lead to an attenuation bias: expecting to receive more fouls for a given style of play, the players may play less aggressively, minimizing the impact of referee discrimination on realized fouls. This suggests that our results understate the amount of discrimination. Alternatively, if players exhibit oppositional responses, they may play more aggressively when policed by the opposite race. Importantly, such oppositional responses suggest that our findings are driven by changes in player behavior, rather than referee behavior. Yet if this were driving our results, one might expect to see effects not just on the number of fouls earned, but on the likelihood of fouling out, as well as other indicators of aggression, including blocks and steals. Instead, we find that blocks and steals actually decline under opposite-race referees.

I'm not persuaded by this reasoning. The player response needn't take the form of aggression--it merely needs to be a general decline in player performance in the presence of opposite-race referees. What if, for example, players find it more difficult to concentrate on their tasks when the refs are of opposite race? Elsewhere in the paper, the authors write, "Player-performance appears to deteriorate at every margin when officiated by a larger fraction of opposite-race referees." So why assume that it's the refs not the players? And why make a statement, "Basically, it suggests that if you spray-painted one of your starters white, you’d win a few more games," even under the possible coaxing of a reporter?

The interpretation of the results that it's the players, not the refs, may also reconcile the results of NBA's internal studies that claim that, on a call-by-call basis, there is no evidence of racial bias. (The NBA has not released the results of these studies, much less the data.) If the players are changing their game based on the racial composition of the refereeing crew, then it is possible that every call or non-call is legitimate, and both studies can be accurate.

A Game Show Rather than a Political Forum

I watched the Republican "debate" last evening. For what it's worth, I thought Tommy Thompson gave one of the best answers (on making Iraq more of a legitimate federal system) and one of the worst answers (on not opposing an employer firing an employee for being gay) of the evening. Overall, I think Captain Ed's summary at the NRO symposium was on the mark:

I think the first question we have to answer is “How did MSNBC do?” Answer: Poorly. This presidential debate resembled a game show rather than a political forum. We had three moderators, one of whom insisted on rambling all over the stage to ask questions from the online audience. Those questions made the MTV “Boxers or briefs?” question seem thoughtful and relevant at times. One bright light apparently expected an answer to “What do you dislike most about America?” Lightning-round queries by Matthews left the candidates understandably frustrated when complex questions left no time for good answers. The format also made for uneven candidate participation; we heard less from Rudy Giuliani than we did from Ron Paul.

Mitt Romney had the best night. Calm, warm, thoughtful, and engaging, he looked and sounded like a serious presidential candidate. John McCain and Giuliani didn’t do themselves any favors, and at times did some damage, but managed to rally back to adequacy. Jim Gilmore, Mike Huckabee, and Duncan Hunter made cases as real candidates, while Sam Brownback didn’t quite get over that hump. Tom Tancredo showed no depth outside of immigration. The two embarrassments were Tommy Thompson and Ron Paul. Thompson’s takeaway was that he doesn’t oppose firing people for being gay, while Ron Paul’s was his insistence on answering every question with a discourse on the original intent of the Constitution. Both of them should understand their roles as the GOP’s Crazy Uncle Bobs and return to the attic forthwith.

If Fred Thompson can manage to skip the rest of these debates until the primaries, he might become the consensus Republican nominee. He may have actually won this debate simply by forcing the others to endure this one without him.

I stand by my earlier post on how unhelpful these events with so much time left to go before the election.