Saturday, March 19, 2005

Agenda Setters

Josh Marshall writes:
One of the Democrats' greatest problems -- far more insidious than many realize -- is their desire to gain the approval and approbation of establishment Washington and its A-list pundits.
It may be true, in that it forces them to operate in the weird echo chamber of Washington opinion when the issues have national importance (do we really want the Georgetown party circuit determining what policy makers think is right and important?). But then, it's not so insane. When the A-list pundits are reporters and the like, they are the ones who determine how the masses perceive what's going on in Washington, they are "agenda setters." Say what you will, but it's not so insane to cater to such people. Not doing so, in fact, can be disastrous in that press coverage will create the impression that you are doing the "wrong" thing; and there is an odd hysterisis in politics: (recent, and more distant) history matters, if press coverage is bad even if you are right on the issues, then you are doomed, unless you have some way of circumventing those agenda setters.

Sunday, March 06, 2005

Cost Saving Measures

Apparently we send prisoners in the war on terror abroad not to, well,torture them but to...save money?

The official declined to be named but agreed to discuss the program to rebut the assertions that the United States used the program to secretly send people to other countries for the purpose of torture. The transfers were portrayed as an alternative to what American officials have said is the costly, manpower-intensive process of housing them in the United States or in American-run facilities in other countries.

Eliminating Downsides

The Times has a story about the Medicare bill, expressing surprise that insurance companies are willing to sign up. The headline reads "Defying Experts, Insurers Join Medicare Drug Plan." But there seems to be a temporal problem with the defiance.
In 2000, however, when the legislation began moving through Congress, Charles N. Kahn III, who was then president of the Health Insurance Association of America, said: "Private drug insurance policies are doomed from the start. The idea sounds good, but it cannot succeed in the real world."
Note, though, that this is in 2000, before the bill was, well, improved. Specifically,
Insurers say they now find the risk acceptable because the government will protect them against large financial losses, at least in the first years of the program.

Under the law, the government offers subsidies to insurers, pays more for sicker patients and pays still more if the claims significantly exceed what the insurer expected.
Or, insurers make money by taking risks. The bill allows them to take risks, but the government guarantees they won't lose money. Not surprisingly, they are willing to take the business. Eliminate the downsides, and it's always a good investment.

Friday, March 04, 2005

Political Bullshit and Market Failure

I'm reading The Myth of Democratic Failure by Donald Wittman. He argues, among other things, that voter ignorance isn't the problem we typically take it to be because, especially in a two party state, voters have to be only minimally informed to make the "correct" choice. It's not necessary for voters to know their elected officials voting records in detail, just that voters have a broad sense of what's happening. In particular, the elected official's opponents will be a good source of information about the important details.

This raises the question how did Bush win for we liberals like to use voter ignorance to explain it. In particular, we see Bush winning because he both lied about his positions and because he created an environment in which disagreements were not to be taken seriously, the obvious corrective mechanism in the political market.

We can imagine a candidates public pronouncements being largely bullshit (in the Frankfurt sense), then what happens with voter ignorance? Then the obvious corrective mechanism in the political market is for the Kerry campaign to point this out. Somehow in Wittman's model voters are supposed to come away with an accurate take on Bush's positions. But if one candidate is willing to spout bullshit, or lie, how does this happen?

I see several mechanisms:
- The statement is so obviously bullshit/a lie that voters know it to be so and react accordingly.
- Your well-informed friend tells you it's a lie, and you believe him.
- The other campaign is able to convince the public that it is a lie, and the public believes this other campaign.
- Experts say this is so, and the public believes it
- Similarly, reporters say it is so, and the public believes it.

Excepting the first and possibly the second, I'm convinced that you could see the 2004 election as proving that in some cases the other three mechanisms fail. The Kerry campaign was unable to shift the debate or the facts when it wanted to. And the Bush campaign managed to "pollute the waters" through talk of patriotism and through the broader right wing attack on universities such that experts were not to be trusted because of course that was unpatriotic or just so much partisan hackery (I'm thinking specifically of economic policy and the lack of weight the almost unanimous disapproval of Bush's economic policies by economists held). And reporters were either not to be trusted or wrote he said/she said stories.

If these mechanism fail, then what? This doesn't actually undermine Wittman's thesis, for you could see the same thing at play in economic markets with corporations lying about their products or themselves. But those things are regulated -- to a degree -- and because the interaction is repeated more times, it's easier to adjust behavior. Yet there aren't that many presidential elections. The issue here is that a market failure in the political market seems to have much more dramatic consequences than a market failure in the economic market. Sure maybe these things are temporary (but then how is it that views shift over time and issues are framed?), but temporarily much damage can be done.