Oct. 12, 2012

Welcome to Wonkbook, Ezra Klein and Evan Soltas’s morning policy news primer. Send comments, criticism, or ideas to Wonkbook at Gmail dot com. To read more by Ezra and his team, go to Wonkblog.

Wonkbook dashboard

RCP Obama vs. Romney: Romney +0.7%; 7-day change: Obama -4.0%.

RCP Obama approval: 49.8%; 7-day change: -1.0%.

Intrade percent chance of Obama win: 62.7%; 7-day change: -11.0%.

Top story: The VP debate

Biden and Ryan debated foreign and domestic policy last night. Here’s what you need to know. “Vice President Biden and Rep. Paul Ryan clashed over Libya, Afghanistan and the economy in the campaign's only vice-presidential debate Thursday, interrupting and re-interrupting one another during a 90-minute exchange shaped by Biden's aggressive tone. Ryan picked up themes used by his running mate, Mitt Romney, in last week's presidential debate. He criticized the Obama Administration for its handling of an attack in Libya, and accused it of dodging hard questions about the debt…But the debate's dominant voice was Biden's. The vice president was assertive in a way that President Obama had not been, chuckling in seeming exasperation several times at Ryan's arguments, and interrupting the Republican in mid-argument…But, at times, Biden's tone edged toward dismissive. In a few instances, he cut off his counterpart multiple times in the same answer. Eventually, Ryan seemed frustrated with the cacophony of the two talking over each other.” David A. Fahrenthold and Felicia Sonmez in The Washington Post.

Read: The full transcript of the vice-presidential debate.

The VP candidates offered sharp contrasts which will divide voters along partisan lines. “It was the debate that President Obama and Mitt Romney did not have a week ago. Vice President Joseph R. Biden Jr. and Representative Paul D. Ryan fiercely quarreled at the vice-presidential debate here on Thursday night, with Mr. Biden using the cutting attack lines against the Republican ticket that Mr. Obama did not and Mr. Ryan delivering a spirited case for conservative policies that Mr. Romney had soft-pedaled. The 90-minute debate, which unfolded in rapid tempo, offered a spirited airing of the sharp contrasts over the administration's handling of the terrorist attack in Libya, the pace of the economic recovery at home and the role of government in addressing the nation's fiscal burdens. While Mr. Obama and Mr. Romney were not on stage, they were at the center of the conversation as their running mates made certain the evening was squarely focused on defining the men at the top of the ticket. But, under pressure to pass the test, Mr. Ryan displayed a proficiency in areas like foreign policy and kept pace with Mr. Biden, who is 27 years his senior.” Jeff Zeleny and Jim Rutenberg in The New York Times.

The Fix’s Chris Cillizza explains: Winners and losers in the vice presidential debate.

@jimtankersley: Ryan needs to spell out how Romney’s econ plan will speed up growth — Romney was more effective on that front in his debate.

CNN instant poll finds a slight win for Ryan in debate. “A CNN poll of debate watchers released following Thursday’s matchup between Rep. Paul Ryan and Vice President Joe Biden showed 48% of respondents named Ryan the winner and 44% said Biden won. The margin between the two candidates was within the poll’s five point sampling error.” CNN.

But CBS found the opposite, marking it a win for Biden. “Fifty percent of uncommitted voters who tuned into Thursday night’s vice presidential debate in Danville, Ky., said they see Vice President Joe Biden as the winner over Mitt Romney’s GOP running mate Rep. Paul Ryan, R-Wis., according to an instant poll taken by CBS News. Of the 431 polled immediately following the debate, 31 percent deemed Ryan the winner, and 19 percent said they felt it was a tie…Both Biden and Ryan gained ground on relatability and knowledge. The percentage of voters who say they believe they can relate to Biden spiked from 34 percent before the debate to 55 percent; 48 percent think Ryan is relatable, up from 31 percent before the debate. Meanwhile, after watching the two candidates debate, 85 percent of those polled think Biden is knowledgeable about the issues; 75 percent say that about Ryan.” Sarah Dutton, Jennifer De Pinto, Anthony Salvanto, Fred Backus and Lindsey Boerma in CBS News.

@bdomenech: Ryan is spending his entire time deflecting and defending where Romney spent the whole debate on offense.

Twitter answers: Who won the debate?

SILVER: How you should read these VP debate poll numbers. “Instant polls conducted after the debate are suggestive of something between a tie and a modest win for Vice President Joseph R. Biden Jr…The social media sentiment during the debate also seemed to flow along these lines. The liberals in my Twitter feed seemed a bit more satisfied with Mr. Biden's performance than the conservatives were with Mr. Ryan's, but it wasn't a slam dunk…My best guess: perhaps Mr. Biden can be credited with what in baseball statistics would be termed a ‘hold’: something a bit shy of either a win or a save and which will probably seem perfunctory with the passage of time, but which might have done his team a bit of good.” Nate Silver in The New York Times.

@mattyglesias: This is how a debate should be. Liberals think the more liberal candidate is winning, conservatives think the reverse.

Coming out of the debate, the Democratic talking point says Biden got the job done. “President Obama, who campaigned in Miami on Thursday, watched the vice presidential debate aboard Air Force One on the way home to Washington. Upon landing at Andrews Air Force Base, he told reporters, ‘I'm going to make a special point of saying that I thought Joe Biden was terrific tonight. I could not be prouder of him. I thought he made a very strong case. I really think that his passion for making sure that the economy grows for the middle class came through. So I'm very proud of him.’” David Nakamura in The Washington Post.

And the GOP’s talking point is that Biden was rude. “The early word from the GOP side after Thursday night's debate was that Vice President Biden ‘embarrassed himself’ in the face-off by interrupting his opponent and laughing openly.” Felicia Sonmez in The Washington Post.

@DouthatNYT: I feel like Republicans are growing much more confident about their Biden-the-jerk debate narrative as the night wears on.

The debate will certainly be remembered for Biden’s attacks. “It was a sharp and spirited debate, with both candidates delivering some lacerating blows, but Mr. Ryan at times seemed disconcerted by the sheer blowhard intensity Mr. Biden brought to the night. Mr. Ryan tried to be respectful, listening to the vice president with a tilted head, choirboy smile and puppy-dog eyes, but he showed his irritation when Mr. Biden kept interrupting to attack his policy on Medicare…For Mr. Biden especially, the night was his chance to relive past debates and unleash his inner barroom brawler. He had to be contained and courteous when he debated Sarah Palin four years ago, lest he look like a bully. This time he let loose. And unlike the courtly Mr. Bentsen in 1988, Mr. Biden turned his temperature up, singeing the young man across the table with patronizing grins, but mostly withering retorts. His interruptive barrage was as relentless as his silent mugging for the camera.” Alessandra Stanley in The New York Times.

@AlecMacGillis: When Ryan was picked, who thought we’d spend VP debate dwelling on Biden? For good or ill, Ryan’s been so much less dominant than expected.

But also for Biden’s facial expressions. “Did the vice president help or hurt his case with his animated display of grins, grimaces, gesticulations and finger wagging? The vice-presidential face-off was only minutes old when one of the biggest discussions on Twitter focused on Vice President Joseph R. Biden Jr.'s animated gestures and facial expressions. Within minutes of the debate's end, the Republican National Committee and others had cut a highlight reel of the smirks and Cheshire-cat grins, fueling a partisan fight over Mr. Biden's behavior. Watched in split screen, Mr. Biden's broad grin while Representative Paul D. Ryan spoke had the effect of distracting from Mr. Ryan's remarks and telegraphing Mr. Biden's disdain. Whether that was brilliant post-McLuhan-esque use of the medium or undignified overacting was in the eyes of beholders.” Trip Gabriel in The New York Times.

@DKThomp: It’s the Joe Biden Debate. Libs and cons will discuss his points, his smile, his interjections, his nattitude. Ryan is 2nd billing here.

There was more than a bit of generational tension onstage. “It was the Young Gun against the Old Hand, the reformer ready to turn the page on an aging social compact that dates to the New Deal jousting with the veteran — alive for much of that compact's construction — defending the tried and true…If Mr. Biden was sometimes openly emotional, a hot on-screen presence, Mr. Ryan, 27 years his junior, was cooler, often coming off as confident, and fluent in the policy underlying his arguments.” Jonathan Weisman in The New York Times.

@TPCarney: So, yeah, Biden is winning this debate by lying, interrupting, and otherwise being a drunk blustery jerk at the bar.

Fact-checking the debate

Wonkblog explains: Our footnotes on the debate.

On letting Detroit go bankrupt: “Biden claimed that Romney wanted the auto industry to go bankrupt. This statement is drawn from a headline — ‘Let Detroit Go Bankrupt’ — on an opinion article written by Romney for the New York Times. But he did not say that in the article. (He repeated the line, however, on television.) Although ‘bankrupt’ often conjures up images of liquidation, Romney called for a ‘managed bankruptcy.’ This is a process in which the company uses the bankruptcy code to discharge its debts, but emerges from the process a leaner, less leveraged company. Ultimately, along with getting nearly $80 billion in loans and other assistance from the Bush and Obama administrations, GM and Chrysler did go through a managed bankruptcy. But many independent analysts have concluded that taking the approach recommended by Romney would not have worked in 2008, simply because the credit markets were so frozen that a bankruptcy was not a viable option at the time.” Glenn Kessler in The Washington Post.

Fact patrol: Slate’s Matthew Yglesias on five dubious claims from Ryan and Biden.

On Iraq: “Ryan hit Biden hard on failing to secure an agreement with the Iraqi government to keep some U.S. troops in the country…It is true Obama did not secure such an agreement. The main stumbling block was the refusal of the Iraqi parliament to grant U.S. forces immunity from Iraqi prosecution for any alleged crimes committed there beyond the 2011 deadline. It is also true Obama, eager to fulfill his campaign pledge, was not overly eager to maintain forces in Iraq at a time of rising debt at home and a troop surge in Afghanistan…Biden countered that nothing Ryan said was accurate.” Scott Wilson in The Washington Post.

On birth control: “Vice President Biden said the Affordable Care Act would not require religious groups to finance coverage of birth control…But there are still unsettled issues in this matter, so Biden went a bit far saying it is a fact that they will not pay for contraceptives. Some church organizations still object to the mandate despite the exemption for religion-affiliated groups, arguing that they could end up paying for birth control indirectly if the mandate causes their health insurance costs to rise. Furthermore, the Obama administration said in March that it will come up with an accommodation for religiously affiliated employers that self-insure, but it has not yet decided how to handle that seven months later.” N.C. Aizenman in The Washington Post.

On people losing health insurance: “What does Ryan mean when he says 20 million Americans will lose their health insurance under Obamacare? He is referring to a recent CBO study that gave several scenarios for what could happen to employer-based coverage once the law was implemented. The most positive scenario has 3 million people being added to employer coverage, while ‘on balance, the number of people obtaining coverage through their employer would be about 3 million lower in 2019 under the legislation than under prior law,’ the CBO concludes. The worst-case scenario was 20 million people, which is where Ryan got his number.” Glenn Kessler in The Washington Post.

On Libya: “‘We weren't told they wanted more security. We did not know they wanted more security there.’ — Biden, speaking of the consulate in Libya…But this was contradicted by State Department officials just this week, in testimony before a congressional panel and in unclassified cables released by a congressional committee. ‘All of us at post were in sync that we wanted these resources,’ said Eric Nordstrom, the top regional security officer in Libya earlier this year. A Utah national guardsman who led a security team, Lt. Col. Andrew Wood, said: ‘We felt great frustration that those requests were ignored or just never met.’” Glenn Kessler in The Washington Post.

Opinion and reaction to the debate

KLEIN: Biden did his job. “Vice President Joe Biden seemed like he never wanted his debate with Paul Ryan to end. Post-debate commentary tends to focus on who won and who lost. I'd give the edge to Biden, but Ryan delivered a solid performance, and it's hard for me to imagine many voters changing their minds because of a vice presidential debate. But what's unquestionably true is that Biden succeeded tonight…But if it was Biden's job tonight, it's really Obama's job going into the homestretch in the election. Biden gave Democrats hope tonight. But the real question is whether, in the next presidential debate, Obama will give them change.” Ezra Klein in The Washington Post.

@petersuderman: I will be pretty shocked if this debate has any impact except to very mildly encourage some Obama supporters.

COHN: Democrats got what they wanted. “Tonight Democrats got the show they wanted--and President Obama may have gotten the boost he needed…Vice President Joe Biden gave one of the most aggressive, passionate, and detailed debate performances I can recall…[O]n the domestic policy questions at the heart of this campaign--which also happen to be the issues I know best--Biden made the essential points that President Obama did not last week. And he did so in a way sure to fire up liberals, whose disappointment over last week's performance appear to have been a significant factor in Obama's sliding poll numbers.” Jonathan Cohn in The New Republic.

@ezraklein: Biden was stronger through most of the debate. Ryan had a stronger close. But Biden gave the base exactly what they wanted.

DOUTHAT: Biden stopped the bleeding. “The biggest thing that tonight's vice presidential debate illustrated was how unusual last week's presidential debate really was -- a clear victory for Romney, acknowledged as such by liberals as well as moderates, and the clear movement toward the Republican ticket that followed. There's a reason that pundits and political scientists tend to assume that debates usually don't move the polls that much -- it's because they're usually much more like tonight's affair, which was a win for Joe Biden if you like his garrulous ‘I'm your Irish uncle, Paul, so let me interrupt you’ style, a loss for Joe Biden if you tend to tune out when a national politician rolls his eyes and uses the phrase "malarkey," and probably something like a draw for the kind of voters who both sides actually want to influence…Overall, that's good news for the Democrats. Even if only liberals loved Biden, there's a lot to be said for firing up the base after the downer of a performance President Obama delivered last week. The veep's job was to stop the bleeding, to remind viewers of some of the things they disliked about Mitt Romney just a week ago, to give the media something to talk about besides Big Bird, Benghazi and the Romney-Ryan polling surge.” Ross Douthat in The New York Times.

@ezraklein: Obama looked like he didn’t want to be debating Romney in the first place. Biden looked like he never wanted his debate with Ryan to end.

DIONNE: Biden put Ryan on the defensive. “In the first presidential debate, President Obama let Mitt Romney's attacks on him stand, and seemed disengaged. Vice President Joe Biden stayed in Rep. Paul Ryan's face for the entirety of Thursday's vice presidential debate. In the process, he forced Ryan, and by extension the Romney campaign, onto the defensive for a large part of the evening. Obama has a lot to be grateful for…Ryan was forced again and again to answer for his voucher/’premium support’ approach to Medicare, which Biden hammered at relentlessly…And Ryan made a major mistake in defending his past support for privatizing Social Security…Biden was hot, avuncular, occasionally sarcastic, and always engaged. He laughed a lot, and never let a point slip. I am certain that the cheers in Democratic living rooms around the country were as loud as the sighs of relief. That alone was vital to Obama. Demoralized Democrats themselves contributed to the story line of Obama's failure in the first debate. The days of demoralization are over.” E.J. Dionne in The Washington Post.

@MichaelSLinden: My view: Biden won relatively handily. But it won’t have the impact that last week’s debate did.

NOONAN: Biden confused strength with aggression. “For the second time in two weeks, the Democrat came out and defeated himself. In both cases the Republican was strong and the Democrat somewhat disturbing. Another way to say it is the old man tried to patronize the kid and the kid stood his ground. The old man pushed, and the kid pushed back…Last week Mr. Obama was weirdly passive. Last night Mr. Biden was weirdly aggressive, if that is the right word for someone who grimaces, laughs derisively, interrupts, hectors, rolls his eyes, browbeats and attempts to bully. He meant to dominate, to seem strong and no-nonsense. Sometimes he did--he had his moments. But he was also disrespectful and full of bluster.” Peggy Noonan in The Wall Street Journal.

@JimPethokoukis: If you want to have a fact-based debate and other guy is “Hubba, Hubba, Hubba, Medicare, Medicare, Medicare , who do you trust” it’s tough

FRUM: Ryan performed solidly, with one slip-up. “I had the odd experience of first listening to the debate (or rather the first hour of the debate) on the radio; then watching the debate over again on video. On radio, Biden was … what’s the word? … Oh yeah: terrible. Impatient and dismissive, punctuated by forced, faked little laughs and peevish demands for more airtime. Ryan’s voice, by contrast, had a timbre of sincerity, even when he was being evasive, as for example when he sought to escape Martha Raddatz’s demand for more specifics on how the Romney tax plan would work…But on TV, Biden seemed somehow much better: impassioned rather than impatient, aggressive rather than dismissive. Ryan’s superior poise and courtesy – the sincere timbre of his voice that resonated so nicely on radio — seemed suddenly defensive and weak: the indicators of a competitor who doesn’t want to take and hold the center of the arena. On this second view, I was struck most by Biden’s relentless hammering of the points most likely to resonate with voters: the auto rescue, withdrawal from Afghanistan by 2014, and the economic interests of the middle class.” David Frum in The Daily Beast.

@BobCusack: Unlike last week, this is more of a normal debate where the winner can be debated. This debate didn’t change any votes.

DREZNER: Why we bother with foreign affairs in debates. “'d like to apologize to American voters. I'm one of the 5 percent. The 5 percent, that is, who vote in presidential elections based on the foreign policy views of the candidates. It might seem to the other 95 percent of you that we pull the strings…Really, those of us paying attention to foreign policy are trying to do the rest of you a favor. Maybe if some of you paid attention to the rest of the world as well, American presidents would be more cautious about expending blood and treasure abroad. That sounds crazy, but it's true…If presidents seem to be ever more constrained in their domestic policy making, in foreign affairs the executive branch has far more leeway…It's precisely because presidents have so much more leeway to do what they want in the global realm that I now vote based on foreign policy.” Daniel W. Drezner in The New York Times.

@jimtankersley: This is a very substantive debate. My Twitter feed is focusing largely on facial expressions. This is why we can’t have nice things.

ROSENTHAL: High marks for moderator Martha Raddatz. “Let me say a few words about the really astonishing person who appeared at the vice presidential debate on Thursday — the moderator. Martha Raddatz of ABC News didn't ask puffy questions like Jim Lehrer did at the presidential debate. Or let the candidates get away with vague non-answers, as Jim Lehrer did. Ms. Raddatz acted like a working journalist instead of a television personality from her first question…Ms. Raddatz showed a consistent willingness to call the candidates on their ‘malarkey’…And she refused to let Mr. Ryan ignore her question about his ticket's plan to increase the defense budget.” Andrew Rosenthal in The New York Times.

@CitizenCohn: Reading over transcript, struck again by Raddatz questions. Substantive and very specific — made it tougher to evade questions. Well done.

BARRO: Actually, Raddatz was a bad moderator. “I actually thought the worst performer on the stage was moderator Martha Raddatz of ABC News. I'm against the consensus of my Twitter feed on this, and I'm sure I'll get letters, but I thought her topic selection was terrible and led to a debate that was much less useful than it could have been. Raddatz asked a lot of foreign policy questions, which was fine, but Libya, Afghanistan, Iran and Syria each got their own question, with no discussion of China, Latin America or Europe. It was like a bad replay of 2004, when we acted like the Middle East was the only part of the world that mattered…This is time that could have been spent discussing other issues that have thus far been neglected in the debates: immigration, monetary policy, housing policy, unwinding the fiscal cliff. The result was a muddled debate, much of it spent on issues of little importance to voters.” Josh Barro in Bloomberg.

@jbarro: This debate was a draw. Will read to most voters as two guys bickering, often incomprehensibly.

KLEIN: What I learned from debating Paul Ryan. “[O]ver the past few years, I've spent a good number of hours arguing policy with Ryan, and an even larger number of hours trying to understand his policies. So what have I learned? First, he's smart. This shouldn't need to be said, but some liberals seem to think Ryan's intelligence is some kind of facade…Ryan's smart, and he's quick, and he's heard most of what you have to say before…He's sufficiently engaged in the policy conversation that he knows both the arguments for and the arguments against his positions…That's not to say he always has good answers for them. I remember walking away from our first debate somewhat confused. The deeper we drilled into the regulations in Ryan's plan, the more they sounded like the very plans he was arguing against…The result is that, while he's a highly ideological thinker, he doesn't come off as particularly ideological. He comes off as an affable, decent, conservative guy who holds strong views, but recognizes that he doesn't have all the answers and that his party hasn't always lived up to its promises.” Ezra Klein in The Washington Post.

Top op-eds

KRUGMAN: Triumph of the wrong. “In these closing weeks of the campaign, each side wants you to believe that it has the right ideas to fix a still-ailing economy. So here's what you need to know: If you look at the track record, the Obama administration has been wrong about some things, mainly because it was too optimistic about the prospects for a quick recovery. But Republicans have been wrong about everything…[I]if Mitt Romney wins the election, the G.O.P. will surely consider its economic ideas vindicated. In other words, politically good things may be about to happen to very bad ideas. And if that's how it plays out, the American people will pay the price.” Paul Krugman in The New York Times.

BRITTAN: The harmful myth of the balanced budget. “So you think it only common sense that a government budget, like that of a family, should balance? But what do you mean by balance?…Then there is, probably the most important, the primary deficit — roughly how far the government is from reducing its debt…These numbers are likely to be revised unfavourably owing to the disappointing behaviour of the national economy. But the discrepancy between the various versions will remain, as will the conundrum about which total the budget balancers should target…I suggest a threefold division of the national budget. The first would be normal current expenditure, such as spending on teachers or soldiers, which would be always covered by revenue. The second would be a capital budget some of which governments could borrow, but strictly at market rates of interest. The third section would be a stabilisation fund which would inject purchasing power when depression threatens and remove it during periods of inflationary pressure.” Samuel Brittan in The Financial Times.

Internet interlude: The VP debate in GIFs.

Got tips, additions, or comments? E-mail me.

Still to come:Larry Summers wants to keep the payroll tax cut; the risks and rewards of DNA sequencing as a health technique; the fiscal cliff; green fraud in biofuels is rampant; and inspiring advice against discouragement from this year’s Nobel laureate in medicine.

Economy

Claims for jobless benefits decline to a four-year low. “The number of Americans filing new claims for jobless benefits slid last week to the lowest level in more than four and a half years, the Labor Department reported on Thursday. The report provided the latest sign of an improvement in the job market, though the surprisingly large 30,000 drop in new claims may have reflected distortions because of seasonal adjustments that are likely to be smoothed out in coming weeks…Initial claims for state unemployment benefits fell to a seasonally adjusted 339,000, the lowest number of new claims since February 2008. Economists polled by Reuters had forecast claims edging up to 370,000 last week. The four-week moving average for new claims, a better measure of labor market trends, fell 11,500, to 364,000, the lowest in six months.” Reuters.

Exporters in America doing better than you think. “American exporters are reasonably successful on the global stage, selling overseas everything from soybeans to jet aircraft, banking services to Disneyland vacations. Last year, U.S. exports totaled $2.1 trillion, a 14 percent rise from 2010. That activity accounted for many millions of jobs and about 14 percent of the nation's economic output…Looking at the inner details of the latest export numbers -- what American goods and services are being bought internationally and where — gives a sense of both optimism at the nation's often understated advantages, and reasons to worry about the near-term. Strong growth is evident in a number of categories of exports, particularly of sophisticated, complicated manufactured goods. ” Neil Irwin in The Washington Post.

Larry Summers: Keep the payroll tax cut. “Former White House economic adviser Larry Summers warned Thursday that the nation is at risk of sinking into a ‘great stagnation’ — a period of high unemployment and sluggish growth — and urged policymakers to extend a temporary payroll tax cut. Given the weakness of the economy, Summers argued that it is far more important to spur economic growth right now than to restrain record budget deficits — so long as policymakers adopt a plan to stabilize rampant government borrowing over the longer term…The statement puts Summers at odds with current administration officials, as well as congressional leaders, who have indicated that they are prepared to let the tax break expire on schedule in January.” Lori Montgomery in The Washington Post.

@GagnonMacro: We need fiscal stimulus. Extend the payroll tax cut!

Banks are getting bullish on home loans again. “Federal stimulus has ignited a boom in mortgage refinancing, benefiting both homeowners and banks. And the good times could continue as the government steps up its support of the broad housing market. The proof will be in the profits…In the third quarter, banks probably originated as much as $450 billion of home loans, according to estimates by Inside Mortgage Finance, a publication that tracks the industry. That figure, which includes both refinances of existing mortgages and new loans to buy a house, would be a considerable jump from the previous period…Since the financial crisis of 2008, some large banks have found themselves well positioned to make money when the mortgage market gets hot. The profits from making mortgages have helped banks at a time when lower interest rates have weighed on other sources of revenue.” Peter Eavis in The New York Times.

First public remarks from the Fed’s new governor. “New Federal Reserve governor Jeremy Stein on Thursday entered the debate over the central bank's recent actions to lift economic growth with a forceful defense of the decision to inject hundreds of billions of dollars into the economy. In his first public remarks since joining the Fed in May, Stein, a 51-year-old Harvard economics professor, said he firmly supported the Fed's announcement last month that it will buy $143 billion of mortgage bonds through the end of the year in an effort to reduce already record-low interest rates. He also supported the Fed's decision to declare that it would continue to try to lift economic growth for as long as necessary to meaningfully reduce unemployment.” Zachary A. Goldfarb in The Washington Post.

@BCAppelbaum: Seems like people making lists of potential future Fed chairs should include Jeremy Stein.

Photography interlude: Underwater art by Christy Lee Rogers in the series “Reckless Unbound”.

Health Care

Why insurance status matters for your health. “Researchers at Johns Hopkins University published a study this summer looking at morality rates for heart attack victims. They separated out the patients who had insurance coverage and those who didn't. They adjusted for the severity of the disease and also the patient's neighborhood of residence, a proxy for socio-economic status. They found the uninsured had a risk of death 31 percent higher than those with private coverage after a heart attack. That's not necessarily because the uninsured received worse care for their heart attack, the researchers point out. Instead, it likely has to do with all the preventive care that patients may have skipped out on.” Sarah Kliff in The Washington Post.

Why the Medicare penalties in Obamacare might not work. “The Obama administration recently rolled out two programs that will penalize hospitals that provide low-quality care. The whole idea is to give health care providers a financial incentive to deliver excellent care. While there are some signs that hospitals are changing their behaviors under the new incentives, new research on a similar Medicare program launched four years ago suggests caution about expecting big results…It's hard to know what this means for the new programs that Medicare rolled out earlier this month. The penalties are bigger this time around — but would still take a relatively minor fraction of a hospital's budget. A hospital could lose, for example, 1 percent of its Medicare revenue if it has too many patients readmitted to the hospital within a month of a first visit. It could lose another 1 percent if it does not get high ranks from patients on quality measures.” Sarah Kliff in The Washington Post.

U.S. panel urges care as DNA sequencing goes mainstream. “A top bioethics panel warned Thursday that the rise of affordable DNA sequencing will jeopardize patient privacy on a wide scale unless governments embrace preemptive standards on handling genetic data. In a new report, the Presidential Commission on Bioethics touted the ‘enormous promise’ of whole-genome sequencing when leveraged for medical advancement. But the panel also urged federal and state officials to take an active role in preventing privacy lapses that could leave patients vulnerable.” Elise Viebeck in The Hill.

Domestic Policy

Why the fiscal cliff freaks businesses out. “You haven't heard much about Enhanced Section 179 expensing on the campaign trail. There's no mention of it in President Obama's 2013 budget or Romney's economic plan. But it's among the reasons that businesses are so worried about the looming fiscal contraction at the end of the year.” Suzy Khimm in The Washington Post.

@grossdm: ok, this is getting ridiculous. my kids are now citing “uncertainty due to fiscal cliff” as reason not to make their beds

And how the fiscal cliff matters on the margin. “Everyone knows that the fiscal cliff means a big tax increase…But what's arguably more important than the cliff's effect on the average tax rates that families pay is what it does to their marginal tax rates. Think of it this way. If you're a married couple making between $75,000 to $100,000 a year, you're paying around 8.1 percent of that in federal income taxes. But you're most likely in the 25 percent tax bracket. That means that for each additional dollar you earn, 25 cents goes to income taxes. Marginal tax rates thus tend to influence peoples' economic choices a lot more than their average tax rates…Households making between $40,000 to $50,000 a year, which is pretty close to the median, see marginal rates on wage income go up from 32.4 percent to 33.1 percent, when you count both the income and payroll taxes. That's something, but probably not enough to deter a lot of people from working more.” Dylan Matthews in The Washington Post.

Your daily cure against discouragement interlude: When this year’s Nobel Prize winner in medicine was told he would never be a real scientist by a teacher in a report card.

Energy

US struggles to rescue green program ridden with fraud. “Under [an] E.P.A. program, initiated in 2009, a producer who makes diesel fuel from vegetable oils and animal fats receives renewable energy credits for every gallon manufactured. The producer can then resell the credits to refiners, who pay millions of dollars for them under a government mandate to support a minimum level of production. The credits can also be resold, a commonplace activity in the arena of corporate compliance with federal environmental rules. The problem is that at least three companies were selling bogus credits without producing any biodiesel at all, the E.P.A. has said in announcements over the last year…Now no one is certain how many of the credits are real. So far, more than $100 million in fraudulent credits have been identified, the refining industry estimates. That amounts to roughly 5 percent of the credits issued since 2009, but the percentage could rise as current investigations of other producers progress.” Matthew L. Wald in The New York Times.

The move towards carbon capture and storage is too slow. “If you ask the experts at the International Energy Agency how the world can avert drastic global warming, they'll say it will take lots of different solutions…[One is that we'll] need to figure out how to capture some of our existing carbon-dioxide emissions from power plants and industrial facilities and bury them deep underground. So how's that going? A big new report from the Global CCS Institute takes stock of carbon capture and sequestration (CCS) projects around the world as of 2012. And progress has been rather slow. While a handful of carbon-capture projects are coming online, there's still nowhere near enough to make a major contribution toward tackling climate change…Worldwide, there are just eight CCS projects in operation…Altogether, these eight projects are storing 23 million tons of carbon-dioxide underground each year. The number is expected to rise to 16 projects capturing 36 million tons of carbon-dioxide per year by 2015.” Brad Plumer in The Washington Post.

Oil and gas industry sees itself in crosshairs, prepares to defend tax treatment. “A top lobby for the oil-and-gas industry said Thursday that its members had some concerns about a push to overhaul the tax code. Stephen Comstock of the American Petroleum Institute told reporters that, while the industry understood the value of a streamlined tax system, the group's members haven't pressed too hard for a simpler code…More broadly, the oil-and-gas lobby's stance also underscores the difficulty of tax reform — which, if successful, would almost certainly stick some taxpayers or sectors with a higher tax bill…Part of the industry's defense is that it already shells out more to governments than most industries, with API saying that oil-and-gas paid an effective tax rate of almost 45 percent between 2006 and 2011. ” Bernie Becker in The Hill.

Expecting oil exports? “Some of the world's biggest oil companies and traders are poised to export substantial amounts of crude from the US for the first time in decades, as booming output there promises to reshape global energy markets. Royal Dutch Shell, BP and Vitol, the world's largest independent oil trading house, are among the six companies known to have applied to the US government for export licences, the Financial Times has learnt…US federal rules and the country's dependency on imports have kept all but a trickle of crude from leaving the US. But a surge in supplies from states such as Texas and North Dakota have prompted companies to seek out refinery customers in Canada.” Gregory Meyer and Ed Crooks in The Financial Times.

A materials race in light-weight cars. “The Energy Department says that reducing a car's weight by only 10 percent can improve fuel economy by 6 to 8 percent. Three technologies that show promise in lightening vehicles are high-strength steel, carbon fiber composites and aluminum. All of them are supported by $8 million in development awards that the department has doled out to the likes of General Motors, Ford and Caterpillar, as well as to two federal laboratories. Drivers worried about running into older, heavier sport utility vehicles on the road might be reassured that these new materials are exceptionally stiff and strong, and will have to pass muster, including crash tests, with the National Highway Traffic Safety Administration.” Jim Motavalli in The New York Times.

Wonkbook is produced with help from Michelle Williams.

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