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Pass the farm bill, or these kids on food stamps get it

Ezra Klein's Wonkbook

June 20, 2013

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.

There’s a farm bill reauthorization moving through Congress. And like everything else that moves through Congress it’s not moving with quite the alacrity that supporters want. So Rep. Mike Conaway, a Texas Republican, is offering an amendment to get Congress working again: Either pass the farm bill by September 30th or the food stamp program gets it.

Yes, food stamps. The particular spur Conaway has come up with is that if Congress doesn’t move with more urgency food stamps, which are part of the farm bill, take an across-the-board cut. According to the Center on Budget and Policy Priorities, the formula Conaway is using would cut the average benefit by $64 per month, or 15 percent.

“Among those who would be harshly affected are the 22 million low-income children -- 10 million of whom now live below half of the poverty line -- and the 9 million low-income elderly and disabled people who rely on SNAP assistance to try to get enough to eat,” writes Bob Greenstein, CBPP’s president.

This isn’t just a bit cruel. It’s also really, really unusual. For decades now, these kinds of action-forcing, sword-of-Damocles ideas have excluded programs that serve the poorest Americans. That’s why, for instance, sequestration excludes food stamps and Medicaid and the Earned Income Tax Credit. Conaway is turning that on its head: His amendment exclusively targets a program that serves the poorest Americans.

Conaway’s been very public about his reasoning. The amendment, he says, is necessary to get Democrats to vote for the bill. “Right now they're on the take side and they're not part of the process," he told the Associated Press. And without more Democratic votes, the bill can’t pass. So he’s giving Democrats a choice: get on the bill or the poorest Americans will get less food.

Remember this story next time you see a poll showing Congress to be the least trusted institution in American life.

Wonkbook’s Number of the Day: 7 percent. That’s the unemployment rate threshold that would begin the end of the bond-buying program, Fed chairman Ben Bernanke announced in yesterday’s monetary-policy meeting.

Wonkbook’s Graph of the Day: This graph shows how bad the Fed is at predicting the future.

Wonkbook’s Top 5 Stories: 1) immigration reform looking better; 2) a 101 on the monetary policy announcement; 3) a new green agenda; 4) the unknown exchanges; and 5) in drones we trust?

1) Top story: An immigration-reform breakthrough?

Border-security deal boosts immigration reform’s hopes. “The Senate's Gang of Eight and a pair of Republicans are near a deal that would beef up the immigration bill's border security language and break a major impasse between the two sides, senators and aides say. Democrats and Republicans are beginning to sell the agreement to their respective caucuses, but if the deal holds, it could put immigration legislation on a glide path to pass the Senate by the end of the month by delivering a large, bipartisan majority of votes. The emerging deal would soften Republican requests for a strict requirement that 90 percent of illegal border crossers be apprehended to hit a "trigger" toward a pathway to citizenship for undocumented immigrants, but would provide an unprecedented increase in border security funding and officers and a guarantee on finishing the fence along the Southern border, sources said.” Burgess Everett, Manu Raju and Carrie Budoff Brown in Politico.

Senate kills Rand Paul border-security amendment. “Senate supporters of an immigration overhaul drew the line on which border-security measures they were willing to accept Wednesday, effectively killing an amendment designed to give Congress more clout on security issues. The Senate voted 61 to 37 to table an amendment by Sen. Rand Paul (R., Ky.), effectively killing it. All eight senators from the bipartisan group that drafted the immigration bill voted to table the measure…Mr. Paul’s bill would have put into practice new visa-tracking systems and required Congress to vote repeatedly on whether the border is secure. Congress would have to give its approval on border security before immigrants in the U.S. illegally could gain legal status--a deal breaker for those in the group of the eight.” Sara Murray and Janet Hook in The Wall Street Journal.

@ryanavent: Important to remember that fiscal effects of immigration are basically meaningless next to massive welfare gain to migrants themselves.

House approves controversial immigration bill. “The House Judiciary Committee approved a measure late Tuesday that would make it a federal crime for illegal immigrants to be in the United States. The Republican-backed proposal also would permit state and local governments to draft their own immigration laws, as long as they are consistent with federal statutes…The committee approved the bill late Tuesday night on a party-line vote of 20 to 15.” Ed O’Keefe in The Washington Post.

Sen. Landrieu: Let’s pass the easy amendments first. “"I would like right now is to stop this operation here until we can get the noncontroversial amendments out of the way," Landrieu said on the floor Wednesday evening. "Those amendments that are thoughtful go to the back of the line and only the amendments that have no chance of passing get discussed on the floor. ... That's not the Senate I signed up for."…Landrieu said Democrats have produced a list of more than 20 amendments they'd be willing to pass. She suggested Republicans come up with a similar list, adding that the current system rewards bas behavior.” Ramsey Cox in The Hill.

@reihan: Wasn’t premise of the comprehensive immigration reform that it would tackle unauthorized immigration in exchange for legalization?

Republican immigration votes are slipping away. “Sen. Marco Rubio (R-Fla.) is feeling the heat as potential GOP allies are now turning against his immigration reform bill. Republican colleagues who were previously viewed as possible "yes" votes are keeping their distance…Republican Sens. Mitch McConnell (Ky.), Rand Paul (Ky.) and John Cornyn (Texas), who were once viewed as possible supporters of the bill, are now expected to reject it…Republican Sens. Bob Corker (Tenn.) and John Hoeven (N.D.) met Wednesday with members of the Gang of Eight, who drafted this bill, to negotiate a compromise on enforcement measures.” Alexander Bolton in The Hill.

Immigration splits Texas Republicans. “Texas lawmakers say it shouldn’t come as a surprise that the state with the longest border with Mexico would find its representatives in Washington playing a large role in the immigration debate. But the different strategies of the state’s 26 Republicans on Capitol Hill, and their divergent views, are providing an unusually vivid illustration of the challenge GOP party leaders face in trying to corral unified support for a rewrite of immigration laws.” Kristina Peterson in The Wall Street Journal.

@grossdm: Kind of ironic. GOP immigration reform rejectionists, largely centered in the south, really wans a permanent form of less-than-free labor

It's almost as if Jeff Sessions' opposition to immigration reform isn't about the poor at all. “Immigration, he warns, could be "the biggest setback for poor and middle-class Americans of any legislation Congress has considered in decades."…But that's not why he opposes anything else. Sessions doesn't typically vote against bills because the benefits accrue to business owners or because they'll make life harder for Americans who can't find work. Quite the opposite, actually.” Ezra Klein in The Washington Post.

Proposal would allow more women to come to U.S. under immigration bill. “Under their amendment, the female senators propose reserving 30,000 residency cards each year for fields in which women hold most of the jobs, such as nannies, home health-care workers and early childhood educators…The lawmakers say pending immigration legislation is unfairly weighted toward male workers because it rewards applicants who are better educated and have more technical skills.” David Nakamura in The Washington Post.

No, the CBO report doesn’t mean immigration brings down wages. “The headline conclusion is that wages would be 0.1 percent lower in 2023 but 0.5 percent higher in 2033 than under current law:..While by 2033, all income groups will see wages rise due to the legislation, in 2023 the middle three quintiles (for reference, that meant those making between $20,262 and $101,582 in 2011) would gain relative to those on the top and bottom.” Dylan Matthews in The Washington Post.

@JimPethokoukis: Previously I didn’t really there was a CBO current law baseline for unlawful immigration. Seems dodgy

Customs and Border Protection avoids sequester furloughs. “Congress has approved a plan to avoid furloughs for U.S. Customs and Border Protection employees in fiscal 2013, according to a statement Wednesday by Homeland Security Secretary Janet Napolitano…The agency had initially planned to furlough its employees for up to 14 days and eliminate unscheduled overtime for Border Patrol agents to trim costs under the government-wide spending cuts known as the sequester.” Josh Hicks in The Washington Post.

HENNINGER: Border fence is dumb idea. “The border-security fence in the Senate bill would be America’s Berlin Wall--a historic embarrassment. Once built, it will never come down. Long after more feasible solutions have resolved the immigration problem, Congress will lose interest in funding so much complex technology. It will sit in the desert sun and rot, the way France’s Maginot Line rotted into the 1960s.” Daniel Henninger in The Wall Street Journal.

LEVIN: The CBO versus the Gang of 8. “Although they contain some helpful projections on the economic and fiscal fronts, the reports undermine the case for the bill in some pretty fundamental ways…[T]hey're saying that, if the bill passes, then 10 years from now, after we have gone through all the effort and political combat involved in offering legal status to today's 11 or 12 million illegal immigrants, there will be somewhere around 7 or 8 million illegal immigrants in America.” Yuval Levin in National Review Online.

DIONNE: Republicans must choose sides on immigration reform. “Changes that so complicate a path to citizenship for illegal immigrants as to render it meaningless are (and should be) unacceptable to supporters of reform, including most Democrats. But if the GOP senators accept something short of this, they will face furious attacks from the hard-core opponents of any move toward large-scale naturalization of those who came here illegally.” E.J. Dionne in The Washington Post.

MILBANK: Tea Party scalds Rubio. “The speed with which the tea party turned on Rubio is stunning, beginning earlier this year with complaints from conservative commentators and now open mockery at a Capitol Hill rally.” Dana Milbank in The Washington Post.

Music recommendations interlude: Daft Punk’s “Get Lucky” played by five pianists.

Top op-eds

KLEIN: Who killed equality? “There are two main schools of thought on income inequality: The fatalists, who contend that rising inequality is the ineluctable result of a changing economy, and the redistributionists, who blame a skewed tax system and lethargic government…Where he parts with both fatalists and redistributionists is in his belief that government policies have hastened those divisive economic changes, and that a different set of government interventions has the potential to counteract them, creating a more equal economy.” Ezra Klein in Bloomberg.

SOLTAS: Four reasons inflation is too low. “The Fed’s own projections anticipate that inflation will stay below 2 percent through the end of 2015. Its best guess for inflation this year is just 1 percent. If such expectations become reality, it would mean that in the time since the Fed has adopted its inflation target, inflation has been above the target for three months and below it for 45 consecutive months.” Evan Soltas in Bloomberg.

CROOK: Bernanke’s forward guidance is as clear as mud. “[I]f you ask under precisely what circumstances the stimulus will eventually start to be withdrawn — which is what investors want to know, and is the message Bernanke keeps saying he means to impart with his commitment to "forward guidance" and transparency — the new refinements really don't help.” Clive Crook in Bloomberg.

BLOW: A nation divided upon itself. “America is quickly dividing itself into two separate nations, regional enclaves of rigid politics, as the idea of common national priorities fades further into a distant past…"In 1976, only about a quarter of America's voters lived in a county a presidential candidate won by a landslide margin. By 2004, it was nearly half."” Charles M. Blow in The New York Times.

International relations is child’s play interlude: Xi Jinping is to Winnie the Pooh as Barack Obama is to Tigger.

2) What you need to know about the Fed

Fed expects to begin stimulus pullback this year if recovery is steady. “The Federal Reserve expects to begin scaling back its massive economic stimulus later this year and end the program by mid-2014 if the recovery continues apace -- delivering its clearest outline of its plans for the multibillion-dollar effort so far…He said he expects the unemployment rate to be about 7 percent when the Fed stops the program, down from the current 7.6 percent and a "substantial improvement" from the 8.1 percent jobless rate when the program began. Bernanke also predicted a pickup in economic growth over the next several quarters. Overall, the Fed sounded a more optimistic note as it wrapped up its regular policy-setting meeting in Washington on Wednesday. It pointed out that the risks to the economy have "diminished" since the fall.” Ylan Q. Mui in The Washington Post.

It’s a conditional withdrawal, remember. “He emphasized, however, that the timing of the retreat depends on the health of the economy; if growth falters, the central bank would slow, or even reverse, the process. The expectations of Fed officials for the next several years, published Wednesday, are more optimistic than the consensus of private forecasters.” Binyamin Appelbaum in The New York Times.

Liveblogs: Read the play-by-play from our Neil Irwin in The Washington Post and The New York Times economics crew.

Explainer: This graph shows how bad the Fed is at predicting the future. Dylan Matthews in The Washington Post.

Bond markets sold off on the Fed announcement. “Bond prices slumped, sending the yield on the 10-year Treasury note to its highest level in 15 months, as the Federal Reserve upgraded its growth projections for the U.S. economy…Yields on 10-year Treasurys jumped, closing at 2.308%, according to Tradeweb, from a low point on the day of 2.167%. Later in the afternoon, the yield on the 10-year Treasury note reached 2.360%. When bond yields rise, prices fall.” Katy Burne and Mike Cherney in The Wall Street Journal.

Return of Drunk Bernanke: What the Fed chairman might want to say, but probably won't. “You guys are focused on the wrong thing! You want to interpret us going from $85 billion a month to, say, $70 billion a month in September versus December versus next year as conveying a ton of information about how loose or tight monetary policy is going to be years into the future. It's not so. It's more a judgment based on factors like whether we're convinced the economy is gaining momentum, whether we expect inflation to rise to our target or decline farther, and how worried we are about the impact our purchases have for the functioning of the bond markets.” Neil Irwin in The Washington Post.

Finance people are from Mars. Economics people are from Venus. “On a day when there is already a strange hothouse atmosphere around the Federal Reserve's policy statement and chairman Ben Bernanke's afternoon news conference, there was a long, often tense exchange on CNBC between Rick Santelli, the network's sometimes-bombastic correspondent (recall that it was one of his rants that launched the tea party movement), and Jon Hilsenrath, chief economic correspondent at The Wall Street Journal…It boils down to Santelli giving Hilsenrath an earful about the reporter needing to give Bernanke and the Federal Reserve more holy hell about the nasty consequences of its easy money policies.” Neil Irwin in The Washington Post.

Senate approves Froman for U.S. Trade Representative. “Michael Froman, currently a deputy national security adviser focusing on international economics, received broad support on Capitol Hill since his nomination last month, although some lawmakers raised questions about his investment in an offshore fund and his commitment to transparency. He was confirmed 93-4 with one senator voting present.” William Maudlin in The Wall Street Journal.

Big banks are violating national mortgage settlement pledge, report says. “A new study supports complaints by state prosecutors that some of the nation's biggest banks have violated the terms of the $25 billion national mortgage settlement, a landmark agreement to clean up shoddy foreclosure practices. The court-appointed monitor of the settlement said in a report Wednesday that Bank of America, Citigroup, JPMorgan Chase and Wells Fargo have dragged their feet in processing homeowners' requests for lower monthly loan payments.” Danielle Douglas in The Washington Post.

In memoriam interlude: James Gandolfini.

3) Here comes the new environmental agenda

Obama to renew emissions push. “The Obama administration is set to renew its push to restrict greenhouse-gas emissions, including delayed measures on coal-fired power plants…On Wednesday, White House energy and climate adviser Heather Zichal said President Barack Obama would soon announce measures to tackle climate change, which she said include a focus “on the power plants piece of the equation.”" Keith Johnson in The Wall Street Journal.

Where’s the policy focus going? “Zichal, deputy assistant to the president for energy and climate change, was less specific, but she outlined three areas that are likely to be the focus of the administration's attention: reducing carbon emissions from power plants, improving the energy efficiency of appliances and expanding the development of clean energy on public lands.” Lenny Bernstein in The Washington Post.

Moniz taps environmentalist as chief of staff. “Energy Secretary Ernest Moniz has tapped highly regarded environmentalist Kevin Knobloch, most recently president of the advocacy group Union of Concerned Scientists, to be his chief of staff.” Al Kamen in The Washington Post.

Report: Building resilience to climate-fueled extreme weather is 'woefully underfunded.’ “The federal government spends six times more on disaster recovery than helping communities become resilient to extreme weather that's predicted to become more intense and frequent in a warming world, a new study shows. The analysis by the Center for American Progress (CAP), a prominent liberal think tank, labels the approach "pound foolish" and calls for a dedicated fund for "community resilience" fed by higher levies on fossil fuel production…CAP, citing Federal Emergency Management Agency estimates, notes that for every $1 invested in "pre-disaster" mitigation, the cost of damage from extreme weather is reduced by $4.” Ben German in The Hill.

Off the beaten path interlude: Western Sahara: Why Africa's last colony can't break free.

4) Nobody knows about the exchanges

Poll: Few uninsured have heard about ObamaCare exchanges. “According to a new poll, only about one in 10 uninsured people have heard “some” or “a lot” about the exchanges, which will begin signing up participants in October. Another third say they’ve heard “only a little” about the new opportunity for healthcare coverage. Half say they’ve heard nothing at all. The survey was released Wednesday by the Kaiser Family Foundation (KFF).” Elise Viebeck in The Hill.

Democrats like health reform better when it's called 'Obamacare.' Republicans not so much. “According to the poll, overall favorability of the law jumps from 35 percent to 42 percent when the term "Obamacare" is used. That's almost entirely due to the enthusiastic reception it gets from Democrats, 58 percent of whom responded favorably to "health reform law," compared with 73 percent for "Obamacare." Independents in the poll reacted about the same to both descriptors (about a third responded favorably while around a half responded unfavorably). Among Republicans, 76 percent responded unfavorably to "the health reform law." That number jumped to 86 percent when "Obamacare" was used.” Sandhya Somashekhar in The Washington Post.

Should we soften the employer mandate? “A pair of centrist senators introduced a bill Wednesday to soften the employer mandate in President Obama’s healthcare law. The healthcare law requires employers to offer coverage to employees who work more than 30 hours per week. Some employers have said they will reduce workers’ hours to avoid the mandate. Sens. Joe Donnelly (D-Ind.) and Susan Collins (R-Maine) proposed a bill to move the threshold to 40 hours per week, saying the employer mandate should match the traditional definition of a full-time worker.” Sam Baker in The Hill.

What to expect of the small-business exchanges. “Looking to buy a small group plan from your state’s new health-insurance exchange? There’s a risk it won’t be ready to open on time in October. A report released Wednesday from U.S. Government Accountability Office said that officials still have big tasks to complete, including reviewing plans that will be sold in the exchanges and training and certifying consumer aides who can help small businesses and individuals find plans.” Sarah E. Needleman in The Wall Street Journal.

ObamaCare premiums lower than expected. “Premiums for a middle-of-the-road policy have come in below earlier estimates in all nine states that have released their initial rate information. A new analysis from Avalere Health says the lower-than-expected prices show that the central piece of the healthcare law -- new insurance exchanges in each state -- is working as intended.” Sam Baker in The Hill.

Robotic interlude: Test drivers are no longer humans.

5) In drones we trust?

FBI: Surveillance drones used over U.S. soil. “The head of the Federal Bureau of Investigation acknowledged Wednesday that his agency uses drones to conduct surveillance in the United States, but said it does so rarely. Asked about drones at a Senate hearing, FBI director Robert Mueller said the agency uses them "in a very, very minimal way, very seldom."” Devlin Barrett in The Wall Street Journal.

The NSA’s secrecy is bad for the NSA. ”At a rare unclassified session of the House Permanent Select Committee on Intelligence, Deputy NSA Director John Inglis said that there are only 22 officials with the authority to approve queries of the NSA's massive database of domestic calling records, and that only seven NSA officials have authority to approve disclosure of information about Americans to other agencies such as the FBI.” Timothy B. Lee in The Washington Post.

Reading material interlude: The best sentences Wonkblog read today.

Wonkblog Roundup

Delaware is bailing out its casinos. Wait, what? Lydia DePillis.

Democrats like health reform better when it's called 'Obamacare.' Republicans not so much. Sandhya Somashekhar.

The NSA’s secrecy is bad for the NSA. Timothy B. Lee.

Here's everything you need to know about Bernanke's press conference today. Neil Irwin.

This graph shows how bad the Fed is at predicting the future. Dylan Matthews.

It's almost as if Jeff Sessions' opposition to immigration reform isn't about the poor at all. Ezra Klein.

Finance people are from Mars, and economics people are from Venus. Neil Irwin.

The U.S. is putting fewer kids in prison these days. Here's why. Brad Plumer.

No, the CBO report doesn't mean immigration brings down wages. Dylan Matthews.

Return of Drunk Bernanke: What the Fed chairman might want to say, but probably won't. Neil Irwin.