The debt ceiling showdown is essentially over. But another manufactured crisis is stalking the recovery.
We are not deadbeats! We are not deadbeats! We are not, well, you get the point.
With the Treasury fast running out of "extraordinary measures" to keep the government from hitting the debt ceiling, and consequently defaulting on its obligations (and maybe the debt too), House Republicans voted to "suspend" the debt ceiling until May 19 -- which, as the Bipartisan Policy Center points out, means raising the debt ceiling until at least August. That's right: a three-month suspension is actually a six-month increase. Remember, there are really two limits when it comes to the debt limit. The first is when the Treasury "hits" the debt ceiling, and the second is when the Treasury really hits the debt ceiling. In other words, the former is when the Treasury has to resort to accounting shenanigans, those "extraordinary measures," to avoid the debt limit, and the latter is when those accounting shenanigans are no longer enough. The Republican plan suspends the debt ceiling until May 19, at which point 1) it will be raised by as much as the government borrows between then and now (probably $450 billion), and 2) the clock will re-set on the Treasury's extraordinary measures. Default day won't come until early August.
Not that default day will ever come. House Republicans don't actually want to play Russian roulette with Treasury bonds, and will raise -- or, if they prefer, "suspend" -- the debt ceiling again when the time comes. And that won't be long in coming. The sequester kicks in on March 1, and the continuing resolution that funds the government runs out on March 27, setting up Fiscal Cliff 2: This Time's It's Budget-y, with some kind of longer-term debt ceiling hike almost certainly figuring into the final deal. If history is any guide, Republicans will demand some smaller cuts in return for not shutting the government down, and try to turn the sequester into more palatable, for them, spending cuts.
For those of you who have trouble keeping all of our manufactured crises straight, the sequester is the $1.2 trillion of purposely painful cuts over the next decade, which was supposed to encourage the super-committee -- remember that one? -- to reach some kind of alternative, long-term debt deal. It didn't, and now Congress is left with a giant pile of automatic spending cuts it doesn't want. As you can see in the chart below from the Bipartisan Policy Center, it would cut almost half a trillion from defense, more than a quarter trillion from discretionary spending (which is already at 40-year lows), and $92 billion from Medicare.
As Jonathan Chait of New York points out, John Boehner has tried to claim the leverage in the upcoming sequester battle by saying he and his caucus really don't mind if it goes into effect. Maybe ... although it strains credulity that a party that has criticized Chuck Hagel for his willingness to cut defense spending doesn't care about cutting defense spending. The operative questions in this game of fiscal chicken are whether President Obama and House Republicans can find mutually agreeable cuts to replace the sequester cuts, and whether they will postpone whatever cuts come out of this latest (though certainly not last) cliff. The first matters more when it comes to protecting the recovery, while the second gets at the deep philosophical divide between the two parties. The risk, of course, is that wrangling over the latter prevents a deal on the former, and that the sequester subsequently starts on schedule, rather than at a later, more opportune, date.
With the default caucus within the Republican party fading into irrelevance, the specter of missing an interest payment on Treasury bonds has thankfully receded. Now we just have to worry about too much austerity too soon.
Hooray, we're not a banana republic. But we still might become Europe.
The Warriors star is the embodiment of basketball’s analytics revolution.
The Golden State Warriors are now some 15 months in to their turn as one of the best teams in basketball history. Last season, they won 67 games, the most in the NBA in eight years, and secured a championship in June against LeBron James and the Cleveland Cavaliers. This season’s Warriors make last season’s Warriors look like a team that hadn’t yet gotten loose. They started the year winning their first 24 games in a row, a record opening, and as of now have won 46 of 50.
Golden State’s brilliance is more than just statistical. The Warriors are a basketball idyll, a paradise of skill and collaboration. Their offense runs on nifty ballhandling, willing passing, and sublime shooting, with their point guard and reigning NBA Most Valuable Player acting as ringleader. A slim 6’3” and 185 pounds, with a bouncy jog and a barely post-pubescent tuft of beard at his chin, Stephen Curry dribbles with the intentional abandon of a card hustler, flings one-handed passes to all sectors of the court, and shoots better than anyone ever has.
The number of American teens who excel at advanced math has surged. Why?
On a sultry evening last July, a tall, soft-spoken 17-year-old named David Stoner and nearly 600 other math whizzes from all over the world sat huddled in small groups around wicker bistro tables, talking in low voices and obsessively refreshing the browsers on their laptops. The air in the cavernous lobby of the Lotus Hotel Pang Suan Kaew in Chiang Mai, Thailand, was humid, recalls Stoner, whose light South Carolina accent warms his carefully chosen words. The tension in the room made it seem especially heavy, like the atmosphere at a high-stakes poker tournament.
Stoner and five teammates were representing the United States in the 56th International Mathematical Olympiad. They figured they’d done pretty well over the two days of competition. God knows, they’d trained hard. Stoner, like his teammates, had endured a grueling regime for more than a year—practicing tricky problems over breakfast before school and taking on more problems late into the evening after he completed the homework for his college-level math classes. Sometimes, he sketched out proofs on the large dry-erase board his dad had installed in his bedroom. Most nights, he put himself to sleep reading books like New Problems in Euclidean Geometry and An Introduction to Diophantine Equations.
The New Jersey governor’s less-than-stellar showing in the New Hampshire primary will make it hard for him to carry on.
Updated on February 9 at 10:51 p.m. ET
For Chris Christie, the 2016 race has been leading up to New Hampshire.
The New Jersey governor, and increasingly long-shot Republican presidential hopeful, had pinned his hopes on a strong showing in the New Hampshire primary. But on Tuesday evening, the results were disappointing for the governor. Donald Trump was declared the winner of the GOP primary shortly after the polls closed, a blow to Christie, who warned that a victory for the real-estate mogul could jeopardize the state’s first-in-the-nation primary status. (Bernie Sanders, meanwhile, was named the winner of the Democratic primary.) In fact, Christie won’t even finish in the top five. An as-yet-incomplete vote tally shows him trailing Trump, John Kasich, Ted Cruz, Jeb Bush, and Marco Rubio.
Sanders’s youth movement is powered by the energy of the new campus left. What does it believe?
RINDGE, New Hampshire—Twenty-three minutes into his typically rambling, hourlong stump speech in the arena here, at a private liberal-arts college on the Massachusetts border—after he had decried the Koch brothers and the prescription-drug companies, after he had accused Wall Street of bribing its way to deregulation, after he had called out the corporate media and the political establishment—Bernie Sanders turned to the bleachers behind him, which were filled with college students waving blue signs and chanting his name.
A sly, unusual smile crossed his face. “I feel like a rock-n-roll star!” he exclaimed, taking off his jacket and tossing it to a startled youth behind him. He pantomimed tearing off his sweater, too, prompting a fresh chant of “Ber-nie! Ber-nie!” Then he grinned sheepishly. “All right, nothing else is coming off,” he said, and continued to the next topic—the sins of Walmart.
He’s tamed the federal budget and brought Ohio's economy back from the brink. His next target might be the White House—and he could be 2016's most interesting candidate.
The last time John Kasich went to New Hampshire, the visit did not go well. It was 16 years ago, and Kasich, a 47-year-old Republican congressman who had made his name in D.C. as the budget-balancing enfant terrible of the Gingrich revolution, was running for president.
Just when Kasich thought he was really connecting with a voter in Lebanon, the woman looked at her watch and asked him when the candidate was going to arrive. A few months later, Kasich’s candidacy was over, a minor footnote to George W. Bush’s steamroll to the GOP nomination.
Kasich is now the two-term governor of Ohio, and he’s thinking about running for president again. He returned to New Hampshire a few weeks ago and was surprised to find that his reception was very different. A gathering at the Snow Shoe Club in Concord, for example, drew a standing-room-only crowd, and the audience members all seemed to know who he was. “Sixteen years ago, I would have been shoveling the driveway!” he told me afterward.
He’s made the once-impossible seem possible—and now all bets are off.
CONCORD, New Hampshire—“Thank you, New Hampshire!” a somber but clearly gratified Bernie Sanders said to a crowd of thrilled supporters in a high-school gymnasium. The 74-year-old democratic socialist from Vermont had just resoundingly won the New Hampshire Democratic primary, dealing an astonishing blow to the Hillary Clinton juggernaut, casting the race into turmoil, and dramatically highlighting the dissatisfaction of the party base with its establishment.
Sanders’s win, he said, had sent a message to the country: “That the government of our great country belongs to all of the people, and not just a handful of wealthy campaign contributors and their super PACs!” The contest, he noted, had inspired record turnout, powered by a force that he implied would make him a better general-election candidate than his rival—“the energy and the excitement that the Democratic Party will need to succeed in November.”
Most people in the U.S. believe their country is going to hell. But they’re wrong. What a three-year journey by single-engine plane reveals about reinvention and renewal.
When news broke late last year of a mass shooting in San Bernardino, California, most people in the rest of the country, and even the state, probably had to search a map to figure out where the city was. I knew exactly, having grown up in the next-door town of Redlands (where the two killers lived) and having, by chance, spent a long period earlier in the year meeting and interviewing people in the unglamorous “Inland Empire” of Southern California as part of an ongoing project of reporting across America.
Some of what my wife, Deb, and I heard in San Bernardino before the shootings closely matched the picture that the nonstop news coverage presented afterward: San Bernardino as a poor, troubled town that sadly managed to combine nearly every destructive economic, political, and social trend of the country as a whole. San Bernardino went into bankruptcy in 2012 and was only beginning to emerge at the time of the shootings. Crime is high, household income is low, the downtown is nearly abandoned in the daytime and dangerous at night, and unemployment and welfare rates are persistently the worst in the state.
Black poverty is fundamentally distinct from white poverty—and so cannot be addressed without grappling with racism.
There have been a number of useful entries in the weeks since Senator Bernie Sanders declared himself against reparations. Perhaps the most clarifying comes from Cedric Johnson in a piece entitled, “An Open Letter To Ta-Nehisi Coates And The Liberals Who Love Him.” Johnson’s essay offers those of us interested in the problem of white supremacy and the question of economic class the chance to tease out how, and where, these two problems intersect. In Johnson’s rendition, racism, in and of itself, holds limited explanatory power when looking at the socio-economic problems which beset African Americans. “We continue to reach for old modes of analysis in the face of a changed world,” writes Johnson. “One where blackness is still derogated but anti-black racism is not the principal determinant of material conditions and economic mobility for many African Americans.”
The Wall Street Journal’s eyebrow-raising story of how the presidential candidate and her husband accepted cash from UBS without any regard for the appearance of impropriety that it created.
The Swiss bank UBS is one of the biggest, most powerful financial institutions in the world. As secretary of state, Hillary Clinton intervened to help it out with the IRS. And after that, the Swiss bank paid Bill Clinton $1.5 million for speaking gigs. TheWall Street Journal reported all that and more Thursday in an article that highlights huge conflicts of interest that the Clintons have created in the recent past.
The piece begins by detailing how Clinton helped the global bank.
“A few weeks after Hillary Clinton was sworn in as secretary of state in early 2009, she was summoned to Geneva by her Swiss counterpart to discuss an urgent matter. The Internal Revenue Service was suing UBS AG to get the identities of Americans with secret accounts,” the newspaper reports. “If the case proceeded, Switzerland’s largest bank would face an impossible choice: Violate Swiss secrecy laws by handing over the names, or refuse and face criminal charges in U.S. federal court. Within months, Mrs. Clinton announced a tentative legal settlement—an unusual intervention by the top U.S. diplomat. UBS ultimately turned over information on 4,450 accounts, a fraction of the 52,000 sought by the IRS.”