Celebrity historian Niall Ferguson doesn't like President Obama, and doesn't think you should either.
That's perfectly fine. There are plenty of legitimate reasons to disapprove of the president. Here's the big one: 8.3 percent. That's the current unemployment rate, fully three years on from the official end of the Great Recession. But rather than make this straightforward case against the current administration, Ferguson delves into a fantasy world of incorrect and tendentious facts. He simply gets things wrong, again and again and again. (A point my colleague James Fallows makes as well in a must-read.)
Here's a tour of some of the more factually challenged sections of Ferguson's piece.
"Certainly, the stock market is well up (by 74 percent) relative to the close on Inauguration Day 2009. But the total number of private-sector jobs is still 4.3 million below the January 2008 peak."
Did you catch that little switcheroo? Ferguson concedes that stocks have done very well since January 2009, but then says that private sector payrolls have not since January 2008. Notice now? Ferguson blames Obama for job losses that happened a full year before he took office. The private sector has actually added jobs since Obama was sworn in -- 427,000 of them, to be exact. For context, remember that the private sector lost 170,000 jobs during George W. Bush's eight years.
Of course, it's not really fair to blame Obama -- or Bush -- for jobs lost in their first few months before their policies took effect. If we more sensibly look at private sector payrolls after their first six months in office, then Obama has created 3.1 million jobs and Bush created 967,000 jobs.
"Meanwhile real median annual household income has dropped more than 5 percent since June 2009."
I can't replicate this result. It's difficult, because Ferguson does not cite his source. The Census Bureau only has data on real median household incomes through 2010 -- and it shows them falling 2.28 percent from 2009. The Bureau of Labor Statistics has numbers on real median weekly earnings that go through 2012, but those only show a 3.7 percent decrease from June 2009.
"Welcome to Obama's America: nearly half the population is not represented on a taxable return--almost exactly the same proportion that lives in a household where at least one member receives some type of government benefit. We are becoming the 50-50 nation--half of us paying the taxes, the other half receiving the benefits."
It is true that 46 percent of households did not pay federal income tax in 2011. It is not true that they pay no taxes. Federal income taxes account barely account for half of federal taxes, and much less of total taxes, if you count the state and local level. Many of those other taxes can be regressive. If you take all taxes into account, our system is barely progressive at all.
But why do almost half of all households pay no federal income tax? Because they don't have much money to tax. Here's the breakdown from the nonpartisan Tax Policy Center. Half of these households are simply too poor -- they make under $20,000 -- to have any liability. Another quarter are retirees on tax-exempt Social Security benefits. The remaining households have no liability because of tax expenditures like the earned-income tax credit or the child credit.
In other words, the poor, the old, and children. Not exactly the "50-50 nation" of makers and takers -- or "lucky duckies" -- that Ferguson imagines.
"By the end of this year, according to the Congressional Budget Office (CBO), [debt-to-GDP ratio] will reach 70 percent of GDP. These figures significantly understate the debt problem, however. The ratio that matters is debt to revenue. That number has leapt upward from 165 percent in 2008 to 262 percent this year, according to figures from the International Monetary Fund."
This is incorrect. Ferguson had it right the first time -- the number that matters is debt-to-GDP, not debt-to-revenue. The former reflects our capacity to pay; the latter our willingness to pay right now. Moving on.
"Not only did the initial fiscal stimulus fade after the sugar rush of 2009, but the president has done absolutely nothing to close the long-term gap between spending and revenue."
Ferguson wasn't always a critic of the stimulus. Back in August 2009, he wrote that "the stimulus clearly made a significant contribution to stabilizing the U.S. economy." Perhaps he thinks the stimulus should have been bigger so the "sugar rush" would last lasted longer? It's not clear. What is clear is that Obama has tried to close long-term deficits -- several times! And the sequester scheduled for next January is his deal with Republicans to rein in spending. More on that in a bit.
"The most recent estimate for the difference between the net present value of federal government liabilities and the net present value of future federal revenues--what economist Larry Kotlikoff calls the true "fiscal gap"--is $222 trillion."
That's a lot of trillions! But if our fiscal gap is "really" this many trillions, why can we borrow for 30 years for a real rate of 0.64 percent? It's because this number is meaningless. First of all, it seems to project many decades of growth figures and budget decisions that we simply don't know will happen. It assumes the Bush tax cuts never ever expire and that the healthcare cost curve never ever bends. This is like projecting, in 1942, that the Empire of Japan will rule the entire Asian continent for 70 years based on a few years of battle outcomes. It's an interesting prediction, but it's not an empirical vision of the future.
"The country's largest banks are at least $50 billion short of meeting new capital requirements under the new "Basel III" accords governing bank capital adequacy."
This would be damning if we had already fully implemented the Basel III bank rules. We have not. As this handy timeline from Deloitte shows, the bank capital ratios don't take effect until January 2013. And even if they had -- which again, they have not -- it would be a bad idea to change risk-weighted capital too much too soon. Europe's banks have done just that, and the results have left something to be desired. The IMF projects their banks will deleverage some $2.6 trillion over the next year and a half -- starving their economies of credit when they most need it. In other words, Ferguson not only get the facts wrong; he gets the economics wrong too.
"The Patient Protection and Affordable Care Act (ACA) of 2010 did nothing to address the core defects of the system: the long-run explosion of Medicare costs as the baby boomers retire, the "fee for service" model that drives health-care inflation, the link from employment to insurance that explains why so many Americans lack coverage, and the excessive costs of the liability insurance that our doctors need to protect them from our lawyers."
There are reasons to think the ACA will fail to address the core defects of the health care system. But it's wrong to say it does nothing to address them. Here's a partial list of the things Obamacare does. It tackles the long-run explosion of Medicare costs. It tries to move away from the fee-for-service model that drives healthcare inflation. And it cuts the link between employment and insurance. In other words, Obamacare does everything Ferguson says it doesn't do, with the exception of tort reform. Matt Yglesias of Slate has a good explainer on how Obamacare tries to do these things -- everything from IPAB, to Accountable Care Organizations and guaranteed issue. Read it.
"The president pledged that health-care reform would not add a cent to the deficit. But the CBO and the Joint Committee on Taxation now estimate that the insurance-coverage provisions of the ACA will have a net cost of close to $1.2 trillion over the 2012-22 period."
Maybe Ferguson doesn't understand the meaning of the word "deficit"? The only other explanation is that he is deliberately misleading his readers. The CBO is quite clear about Obamacare's budgetary implications. It reduces the deficit. Here's what the CBO said exactly:
[T]he effects of the two laws on direct spending and revenues related to health care will reduce federal deficits by $210 billion over the 2012-2021 period.
In other words, the law is more than paid for. As Paul Krugman pointed out, it does spend $1.042 trillion covering people, but it pays for this coverage by finding savings in Medicare and levying a surtax on investment income for high-earners. That Ferguson looked up the CBO's estimate of the bill's cost and didn't notice that those costs are paid for is peculiar indeed. Even more peculiar is that he is apparently doubling down on this falsehood. And yes, it is a very deliberate falsehood.
"Having set up a bipartisan National Commission on Fiscal Responsibility and Reform, headed by retired Wyoming Republican senator Alan Simpson and former Clinton chief of staff Erskine Bowles, Obama effectively sidelined its recommendations of approximately $3 trillion in cuts and $1 trillion in added revenues over the coming decade. As a result there was no "grand bargain" with the House Republicans--which means that, barring some miracle, the country will hit a fiscal cliff on Jan. 1 as the Bush tax cuts expire and the first of $1.2 trillion of automatic, across-the-board spending cuts are imposed. The CBO estimates the net effect could be a 4 percent reduction in output."
Now, Obama did not push Congress to adopt Simpson-Bowles, but neither did Congress adopt it. Among those who voted against it? Paul Ryan, who Ferguson later lauds for his fiscal courage. Although that wasn't the last attempt at a so-called "grand bargain". That came during the debt ceiling standoff the Republicans forced. Obama offered a long-term deal heavily tilted towards Republican priorities -- read: spending cuts -- that the Republicans spurned. Among those who pushed the Republicans to reject it? Paul Ryan, who worried that a deal would burnish Obama's bipartisan credentials and make his re-election a foregone conclusion.
And then there's the cognitive dissonance of it all. Noah Smith points out that Ferguson reproaches Obama for both running big deficits and for closing them.
"The failures of leadership on economic and fiscal policy over the past four years have had geopolitical consequences. The World Bank expects the U.S. to grow by just 2 percent in 2012. China will grow four times faster than that; India three times faster. By 2017, the International Monetary Fund predicts, the GDP of China will overtake that of the United States."
China has 1.3 billion people. The United States has 300 million people. China's GDP will pass ours when they are only four times poorer than us. That might happen in 2017; it might happen later if China's current slowdown is more than a blip. It doesn't really matter if and when this happens. There's nothing Obama can do to prevent China from catching up -- nor should Obama want to! Economics isn't zero sum. The more money China has, the more money they have to buy things from us and other countries. This is good news, and yet Ferguson treats it like a modern-day equivalent of "losing China".
"In his notorious "you didn't build that" speech, Obama listed what he considers the greatest achievements of big government: the Internet, the GI Bill, the Golden Gate Bridge, the Hoover Dam, the Apollo moon landing, and even (bizarrely) the creation of the middle class. Sadly, he couldn't mention anything comparable that his administration has achieved."
It's bizarre that Ferguson thinks government policies didn't help create America's middle class. America was the first country to make high school compulsory. It was also the first country to make college widely accessible with the G.I. bill. This democratization of education went a long way towards laying the foundation for broad-based prosperity. And as for big things the government has achieved lately, surely moving to near-universal healthcare coverage counts?
In the world as Ferguson describes it, Obama is a big-spending, weak-kneed liberal who can't get the economy turned around. Think Jimmy Carter on steroids. But the world is not as Ferguson describes it. A fact-checked version of the world Ferguson describes reveals a completely different narrative -- a muddy picture of the past four years, where Obama has sometimes cast himself as a stimulator, a deficit hawk, a health care liberal and conservative reformer all at once. And it's a world where the economy is getting better, albeit slowly.
It would have been worthwhile for Ferguson to explain why Obama doesn't deserve re-election in the real world we actually live in. Instead, we got an exercise in Ferguson's specialty -- counterfactual history.
Conservatives once warned that Obamacare would produce the Democratic Waterloo. Their inability to accept the principle of universal coverage has, instead, led to their own defeat.
Seven years and three days ago, the House of Representatives grumblingly voted to approve the Senate’s version of the Affordable Care Act. Democrats in the House were displeased by many of the changes introduced by Senate Democrats. But in the interval after Senate passage, the Republicans had gained a 41st seat in the Senate. Any further tinkering with the law could trigger a Republican filibuster. Rather than lose the whole thing, the House swallowed hard and accepted a bill that liberals regarded as a giveaway to insurance companies and other interest groups. The finished law proceeded to President Obama for signature on March 23, 2010.
A few minutes after the House vote, I wrote a short blog post for the website I edited in those days. The site had been founded early in 2009 to argue for a more modern and more moderate form of Republicanism. The timing could not have been worse. At precisely the moment we were urging the GOP to march in one direction, the great mass of conservatives and Republicans had turned on the double in the other, toward an ever more wild and even paranoid extremism. Those were the days of Glenn Beck’s 5 o’clock Fox News conspiracy rants, of Sarah Palin’s “death panels,” of Orly Taitz and her fellow Birthers, of Tea Party rallies at which men openly brandished assault rifles.
Walk into the offices of Memac Ogilvy Advize, an advertising firm on the third floor of a car rental building in a business district of West Amman, Jordan, and you’ll be greeted with an immense black-and-white photo of Donald Trump’s face. The red cursive text printed across it reads: “We Trumped the awards.”
The sign sits behind a reception counter boasting a large trophy won at the Dubai Lynx 2017, an annual advertising competition where Memac Ogilvy won the Grand Prix for PR (a first for any Jordanian agency) along with four other silver and gold prizes, for trolling Trump in their ads on behalf of Royal Jordanian Airlines.
The College Board earns over half of all its revenues from the courses—and, in an uncertain environment, students keep being suckered.
Fraudulent schemes come in all shapes and sizes. To work, they typically wear a patina of respectability. That's the case with Advanced Placement courses, one of the great frauds currently perpetrated on American high-school students.
That's a pretty strong claim, right? You bet. But why not be straightforward when discussing a scam the scale and audacity of which would raise Bernie Madoff's eyebrows?
The miscellany of AP courses offered in U.S. high schools under the imprimatur of the College Board probably started with good intentions. The idea, going back to the 1950s, was to offer college-level courses and exams to high-school students. The courses allegedly provide students the kind of rigorous academic experience they will encounter in college as well as an opportunity to earn college credit for the work.
"Where people are desperate, it is still America they count on, whether they love or scorn it, and America they blame when aid does not come."
After Donald Trump’s victory in the U.S. presidential election in November, a foreign ambassador accosted one of my deputies at the State Department, where from 2014 to early this year I served as theassistant secretary of state for democracy, human rights, and labor. “You must be so sad!” the man, a representative of a Central Asian government, said, grinning widely. “All this talk of elections being important, of democracy being important, and now look at you! Now even your new president says there were 3 million illegal votes in your election! … You must all feel so stupid these days.”
Since then, the global club of autocrats has been crowing about Trump. Sudan’s dictator Omar al Bashir praised him for focusing “on the interests of the American citizen, as opposed to those who talk about democracy, human rights, and transparency.” Iran’s Supreme Leader Ayatollah Khamenei thanked him for showing “America’s true face” by trying to ban Muslim immigration. The Cambodian government justified attacks on journalists by saying Trump, too, recognizes that “news published by [international] media institutions does not reflect the real situation.”
Most of management theory is inane, writes our correspondent, the founder of a consulting firm. If you want to succeed in business, don’t get an M.B.A. Study philosophy instead
During the seven years that I worked as a management consultant, I spent a lot of time trying to look older than I was. I became pretty good at furrowing my brow and putting on somber expressions. Those who saw through my disguise assumed I made up for my youth with a fabulous education in management. They were wrong about that. I don’t have an M.B.A. I have a doctoral degree in philosophy—nineteenth-century German philosophy, to be precise. Before I took a job telling managers of large corporations things that they arguably should have known already, my work experience was limited to part-time gigs tutoring surly undergraduates in the ways of Hegel and Nietzsche and to a handful of summer jobs, mostly in the less appetizing ends of the fast-food industry.
The two-hour work, written and directed by Happy Valley’s Sally Wainwright, is a vibrant dramatization of how three sheltered women became such extraordinary novelists.
When it comes to the Brontë sisters, questions—and mythology—abound. How did three such relatively sheltered women, the daughters of a priest living in rural Yorkshire, write some of the most passionate and proto-feminist novels of the 19th century? To Walk Invisible, a two-hour drama airing on PBS on Sunday, touches on the fascinating contradictions of the Brontës, focusing on the three-year period when the sisters determined to publish their writing as a means of self-preservation. Aware of how they would be judged as women entering a man’s realm, they elected to use gender-neutral pseudonyms, so they could, as Charlotte explained in a letter, “walk invisible.”
To Walk Invisible is written and directed by Sally Wainwright, the creative force behind the BBC’s Last Tango in Halifax and Happy Valley. Like Happy Valley, a gritty drama about a forceful female police sergeant that’s developed an ardent American fanbase on Netflix,it draws much of its mood from the sullen bleakness of the Yorkshire landscape, suggesting a hostile, imposing environment that fosters strength in some and despair in others. In both dramas, Wainwright explores women forced to endure familial hardship: In the Brontë family, the burden is their brother, Branwell, whose descent into alcohol and drug addiction coincides with—and possibly spurs—the literary success of his sisters.
The Obama years left Republicans with excellent ratings from the Heritage Foundation, and no idea how to whip a vote.
The Republican Party’s marquee legislative initiative had just imploded in spectacular, and humiliating, fashion Friday afternoon when Paul Ryan stepped up to a podium on Capitol Hill. The beleaguered house speaker wasted no time in diagnosing the failure of his caucus. “Moving from an opposition party to a governing party comes with some growing pains,” he said. “And, well, we’re feeling those growing pains today.”
Ryan wasn’t wrong. The GOP’s inability to maneuver a health-care bill through the House this week—after seven years of promising to repeal and replace Obamacare—is, indeed, emblematic of a deeper dysfunction that grips his party. But that dysfunction may not be as easy to cure as Ryan and other GOP leaders believe.
Supporters of Trump’s budget are eager to restore the central role of faith-based organizations in serving the poor—but it’s not clear they can be an adequate substitute for government.
President Trump’s initial budget proposal would end aid for poor families to pay their heating bills, defund after-school programs at public schools, and make fewer grants available to college students. Community block grants that provide disaster relief, aid neighborhoods affected by foreclosure, and help rural communities access water, sewer systems, and safe housing would be eliminated. Mick Mulvaney, the director of the White House Office of Management and Budget, suggested recently that even small amounts of federal funding for programs like Meals on Wheels, which delivers food to house-bound seniors, may not be justified.
With billions of dollars worth of cuts to federal social services likely ahead, the wars of religion have begun. Bible verses about poverty have suddenly become popular on Twitter, with Republicans and Democrats each claiming to better know how Jesus would think about entitlement spending. While conservatives tend to bring religion into public-policy conversations more than liberals, the valence is often switched when it comes to the budget: Liberals eagerly quote the Sermon on the Mount in support of government spending, while conservatives bristle at the suggestion that good Christians would never want cuts.
Considered by conservatives to be one of postmodern society’s greatest threats, moral relativism may now be a relic of the past.
Four years before he was hoisted to Speaker of the House, a smooth-faced Representative Paul Ryan declared, “If you ask me what the biggest problem in America is, I’m not going to tell you debt, deficits, statistics, economics—I’ll tell you it’s moral relativism.” It was a bold claim given the depth of the economic recession, which began years earlier. But Ryan was echoing the sentiments of his conservative ancestors who’d made similar claims.
Moral relativism has been a conservative boogeyman since at least the Cold War. Conservative stalwarts like William F. Buckley claimed that liberals had accepted a view that morality was culturally or historically defined—“what’s right for you may not be right for me”—instead of universal and timeless. It’s true that the ethical framework was en vogue, particularly in places of higher education. Liberal college professors stocked conservatives’ arsenals with copious quotes to back up the claim that a squishy, flimsy understanding of morality had taken root in America.
Speaking after the collapse of the Republican health-care bill, the president assigned blame to plenty of parties but cast himself as a mere bystander.
Speaking in the Oval Office Friday afternoon, President Trump surveyed the wreckage of the Obamacare repeal effort and issued a crisp, definitive verdict: I didn’t do it.
The president said he didn’t blame Speaker Paul Ryan, though he had plenty of implied criticism for the speaker. “I like Speaker Ryan. He worked very hard,” Trump said, but he added: “I'm not going to speak badly about anybody within the Republican Party. Certainly there's a big history. I really think Paul worked hard.” He added ruefully that the GOP could have taken up tax-reform first, instead of Obamacare—the reverse of Ryan’s desired sequence. “Now we’re going to go for tax reform, which I’ve always liked,” he said.