Politics with Marc Ambinder

Megan McArdle

Recently by Megan McArdle

Jul 8 2009, 12:30PM

A Second Stimulus Or Health Care?

by Megan McArdle

Paul Krugman asks why favoring a second stimulus, like opposing the Iraq War, has been written out of the public argument.  Now, I seem to remember a very robust and lengthy public argument about the war, which couldn't have persisted without opponents.  But leaving that aside, what about the stimulus?

Well, it is starting to get some traction.  But it probably won't get much, and here's why:  Democrats aren't interested.  They aren't interested because they are already facing political pressure over the debt.  Doing another stimulus will--or so they think--make it much harder for them to do health care and climate change.  Their initial thesis that a big, bold spending program would "prime the pump" for more big, bold spending programs has fallen flat.  The stimulus is working too slowly, probably because little money has yet been dispensed, which has made further spending programs less, not more, popular.

A question for Paul Krugman and other stimulus proponents:  would you rather have a second stimulus, or health care?  I know that in an ideal universe you wouldn't have to choose, but assume that the worrywarts are right, and you do.  Which should Obama get done?

That's a genuine question, and one that I think congressional democrats and Democratic wonks should probably be more conflicted about than they apparently are.  Not to concern troll, but it's a genuinely tricky, and interesting, political question.  If you think a second stimulus will work, and is needed, then you're risking the 2010 midterms and the 2012 election if you don't do it.   On the other hand, what's the point of electing Democrats if they can't get a single major program passed?

Apr 29 2009, 9:19AM

The Trillion Dollar Fix

by Megan McArdle

Facing the biggest financial crisis of our generation, the Obama administration has certainly been busy. In the first hundred days, the administration has pushed through the largest stimulus package in U.S. history, steered Chrysler and GM toward a managed reorganization, and stress tested our banking system. Treasury Secretary Geithner has floated multiple plans to rebuild Wall Street with a mixture of public and private capital. And if, as many critics have claimed, the administration's proposed packages have not always been harsh enough to put the fear of God into wayward bankers, the administration certainly managed to scare the bejeesus out of them Monday morning with the fighter plane that buzzed Manhattan's financial district.

It's probably no exaggeration to say that Obama's presidency will ultimately stand or fall on its handling of the financial crisis. And at this point, with respect to all the frantic activity, the polls seem to be saying, so far, so good. Even though a recent New York Times/CBS survey suggests that Americans don't expect the country to be out of recession by the end of his first term, Obama's approval ratings are in the mid-sixties.

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Apr 20 2009, 5:12PM

Financial Journalism Shut Out Of Pulitzers

by Megan McArdle

No, seriously.  Two sex scandals (Spitzer and Kilpatrick), wildfires, immigration enforcement, OSHA violations . . . but I guess no one was writing anything interesting about finance.  Oh, hell, I have to concede, it was a quiet year for those of us on the finance and economics beat, with no big stories to grab a Pulitzer Committee's eye.  But I feel like they might have thrown us something.

Seriously, though, I have to wonder if this isn't an education problem.  The Pulitzer committee doesn't want to get caught in an embarassing error, implicitly endorsing a theory that turns out to be wrong.  Neglected children are comprehensible, and everyone agrees that they're terrible, so they make great Pulitzer fodder.  Credit default swaps are trickier.  Why take the risk?
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Apr 8 2009, 10:46AM

The Problem with Chris Dodd

by Megan McArdle

This op-ed makes a point I've been hearing a lot of over the last few days:

Meanwhile, with the power to give out our money as they wish, congressmen take campaign money from lobbyists and industries they regulate. Sen. Chris Dodd, D-Conn., is only the latest poster boy for that, but boy is he a good one. There may be no one who better represents all that is wrong with Washington. The powerful Senate Banking Committee chairman got a sweetheart mortgage from Countrywide; he has received $280,000 in campaign contributions from troubled insurer AIG; and he made sure that AIG executive bonuses were untouched by Congress -- then claimed for 24 hours that he knew nothing about it, before reporters forced him to admit the truth.

Polls show Dodd is in re-election trouble. But don't hold your breath: Despite record-low approval ratings for Congress last year, we continued sending our congressmen back at about a 90 percent retention rate.

We have, sadly, been corrupted.

I have to say, the worst allegation I've heard about Chris Dodd is not that he's in the pocket of banks and insurers--financial companies naturally seek to curry favor with the Senate Banking Committee, but I don't really see the case that he's sold us out for his benefit.  No, the more damning case is that the Senate Banking Committee was basically non-functional in the early part of the crisis, because Dodd was running for president.  Even if early action could have saved us money and pain later--and that's a big if--I recently heard a plausible case made that such action was made impossible by his presidential campaign.  But somehow, no one finds that offensive, or even notable.

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Mar 6 2009, 3:19PM

Should Geithner go?

by Megan McArdle

Henry Blodget thinks it is time for Timothy Geithner to go.  So far, Geithner's performance has been shockingly unimpressive.  It's not as if he's walking into the crisis anew; he's been the head of the New York Fed for years, and dealing with these issues from the very beginning.  Yet on the really crucial problem of what to do about the banking system, he's been very nearly silent, going to Congress with a non-plan-plan that terrified the very markets it was supposed to reassure.  Blodget also has a point when he says that Geithner has been mysteriously stuck on his original ideas.  I would add that he seems mysteriously stuck on them, but not willing to pay the political cost of executing them, which is the worst of both worlds.

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Feb 5 2009, 7:49AM

Austerity begins at home

by Megan McArdle

It does seem to me that if Congress is worried about executives spending outrageous sums of taxpayer cash on luxury jaunts . . . they might stop spending outrageous sums of taxpayer cash on luxury jaunts:

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