It Took Nearly Seven Years...

Paul Krugman finally answers a rhetorical question he posed in September of 2003. Way back then he was bashing Bush for Iraq (natch) and for going hat in hand to China to talk to them about their undervalued currency.  His Nobel Prize for international trade was still in the future, so on the gloomy prospects of a currency confrontation between China and the US the extent of his "analysis" was this:

But [President Bush, by way of Treasury Secretary Snow] got no satisfaction. A quick look at the situation reveals one reason why: the U.S. currently has very little leverage over China. Mr. Bush needs China's help to deal with North Korea — another crisis that was allowed to fester while the administration focused on Iraq. Furthermore, purchases of Treasury bills by China's central bank are one of the main ways the U.S. finances its trade deficit.

Nobody is quite sure what would happen if the Chinese suddenly switched to, say, euros — a two-point jump in mortgage rates? — but it's not an experiment anyone wants to try.

That was during the 2003 recession and recovery when the Fed was keeping the Fed Funds rate below 2%.

But the years have passed, as has the Bush Administration, and now Paul Krugman has joined the world in decrying the undervalued Chinese currency.  And he has answers on the economic front!

Tensions are rising over Chinese economic policy, and rightly so: China’s policy of keeping its currency, the renminbi, undervalued has become a significant drag on global economic recovery. Something must be done.

...

If Treasury does find Chinese currency manipulation, then what? Here, we have to get past a common misunderstanding: the view that the Chinese have us over a barrel, because we don’t dare provoke China into dumping its dollar assets.

What you have to ask is, What would happen if China tried to sell a large share of its U.S. assets? Would interest rates soar? Short-term U.S. interest rates wouldn’t change: they’re being kept near zero by the Fed, which won’t raise rates until the unemployment rate comes down. Long-term rates might rise slightly, but they’re mainly determined by market expectations of future short-term rates. Also, the Fed could offset any interest-rate impact of a Chinese pullback by expanding its own purchases of long-term bonds.

It’s true that if China dumped its U.S. assets the value of the dollar would fall against other major currencies, such as the euro. But that would be a good thing for the United States, since it would make our goods more competitive and reduce our trade deficit. On the other hand, it would be a bad thing for China, which would suffer large losses on its dollar holdings. In short, right now America has China over a barrel, not the other way around.

Hmm, some of those points were obvious even to me back in 2003.  As to debunking the "common misunderstanding" that China has us over a barrel, one wonders why that was less obvious back when Bush was raising the issue. One might also wonder whether Krugman was contributing to that misunderstanding with his "Nobody is quite sure what would happen if the Chinese suddenly switched to, say, euros" fog-burst.  And while we are wondering, we might ask when it was that Team Obama solved the North Korean problem that featured so prominently in Krugman's 2003 rhetorical sally.

So many questions.  No doubt some will be cleared up by a Krugman column in 2017.

MORE:  Dan Drezner decries Krugman's bellicose unilateralism and manages to limit his "I told you so-ism" to much less than seven years.

Comments

[Clarice]

He should talk to Trump who figured out long ago the power a really big debtor has .

[Jane]

I asked this last night, but did anyone else see Michael Lewis on 60 minutes last night. I never watch that show, but this segment was stunning.

Clarice, do you get the sense that a lot of people are going to Washington tomorrow?

[Neo]

Hundreds of powerful US “bunker-buster” bombs are being shipped from California to the British island of Diego Garcia in the Indian Ocean in preparation for a possible attack on Iran.

...

Contract details for the shipment to Diego Garcia were posted on an international tenders’ website by the US navy.

A shipping company based in Florida, Superior Maritime Services, will be paid $699,500 to carry many thousands of military items from Concord, California, to Diego Garcia.

Crucially, the cargo includes 195 smart, guided, Blu-110 bombs and 192 massive 2000lb Blu-117 bombs.

Spine of Steel ? ... or Wag the Dog ?

[narciso]

The distinction that I make about Lewis's complaint is that Goldman's product seems to be abetting a fraud, in wrapping subprime debt
in an envelope of legitimacy

[Neo]

Seems the report got ahead of the facts.

Hard Target penetrator changed into low-cost Joint Direct Attack Munition [JDAM] include the 1,000 pound BLU-110 forged steel casing warheads similar to the MK 83.

The BLU-117/B is a 2000 lb penetrator Bomb/Warhead similar to Mk84, which is used in the GBU-10 Paveway II. The BLU-117 is the current GP bomb filled with the Insensitive Munition (IM) explosive PBXN-109 currently used by the US Navy.
Over 12,000 Mk84 bombs were dropped during Desert Storm.

These many be penetrating bombs, but these are not of the MOAB (Mother Of All Bombs) line of penetrators, so this sounds like a standard resupply for the Afghan theater of operations.

[glasater]

Both Lewis and Goodfriend were just on CNBC in a most interesting interview.
Goodfriend was a main character in Lewis's first bestseller "Liar's Poker".
The conversation ended with Goodfriend's questioning of the ratings agencies and their legitimacy. What an awful job they've done for years.
I'm waiting for that expose.

[rse]

OT but part of our ongoing discussion about the new primacy of race and the law in education discussions.

Apparently the Obama Admin filed an amicus brief on Friday giving its full complete advocacy for the use of race in college admissions or other grad programs.

LUN for article.

Brief apparently also makes it clear diversity is a primary goal of K-12 as well.

Along with the disparate impact analysis to be used in high school's on college prep classes and the quotas in health care bill on med school admissions, it's not the postracial era many bought into in November 2008.

Yuck.

[Jack is Back!]

The Greatest Press Conference, Evah!

[NK]

Hey TM--

Catching Krugman with intellectual dishonesty and facile economic analysis? easier than shooting fish in a barrel. I am afraid the die is already cast; US/Europe/Japan sovereign debts are beyond control; ChiCom debt is just as bad, but covered up better; whose ox gets gored? the bond holders natch-- the mechanism will be double digit inflation for 2-5 years; the really rich get hit, the poor get killed, but the political class will skate away saying "who me"?

Tom-- how did you fare in the great Fairfield County storm? we lost a 80 ft hickory --on to our neighbor's house, but all of the falling pines missed us. Darned lucky, apparently no structural damage next door.

[Clarice]

Jane, I've no idea at all.

[bgates]

we might ask when it was that Team Obama solved the North Korean problem

Same day they fixed Darfur.

[Jane]

Glasater,

The 60 minutes piece was amazing. It talked about how all these big deal billion dollar brokers were completely clueless. And how Goldman insisted AIG get bailed out because AIG was insuring Goldman's investments. So the money AIG got, went to Goldman. And how these same guys who have now figured out what they did to destroy the economy have been hired to fix it.

There were apparently about 20 people who saw this coming. They interviewed one - he made $878 million bucks by guessing that the economy would tank in 2007. He realized it by looking at one piece of paper.

It was an incredible segment.

[Jane]

Clarice,

I figured that DC would be a tough place to feel an influx, but I didn't know.

[Patrick R. Sullivan]

Jane, it was only incredible in that 60 Minutes was dumb enough to buy the story of a dilettante like Michael Lewis. His 'expertise' was in having been a salesman for Salomon Bros. for a few years. Like most salesmen, he didn't understand what he was selling.

Notice they didn't talk about the source of the bad mortgages; without which there would have been no crisis at all. Whatever the failings of the ratings agencies (themselves a duopoly created and protected by government), if the loans had been sound their ratings were moot. Nor did Lewis mention the Basel international banking regulations that made such AAA ratings attractive.

Had they tried to produce an honest and informative piece, they would have started with the Federal government's assault on the home loan industry; i.e. that those bad loans were official government policy. Instead of promoting the latest book by a poseur like Michael Lewis, they should have interviewed U 0f T-Dallas economist Stan Liebowitz. Maybe have him read from the paper I just linked to.

[narciso]

Well he is peddling a book, optioned to be a movie, the Big Short, and it follows a very
reductionist view of the subprime problem

[glasater]

As per usual--Patrick R. Sullivan and Narciso have impeccable assessments and I mean that very sincerely.

No one ever mentions the governments involvement in setting up the situations for this kind of chicanery and in the end the horrible results.

[Jane]

Patrick,

Did you actually see the 60 Minutes segment. I have no frame of reference but he didn't discount any of those causes you mentioned. It was a pretty big indictment of Goldman and the industry as a whole, but it certainly didn't vindicate the government.

[glasater]

In the CNBC interview of Michael Lewis doesn't deny the governments involvement.

[Ignatz]

As much as I dislike Goldman and the rest of Rick's "banksters", seems to me blaming them as the cause or even a cause is like blaming the vultures picking away at a roadkill for the death of the critter they're eating and ignoring the car that ran over it.

[Jane]

Oh I think they deserve some blame -- particularly with the whole "you have to bail out AIG so we can get repaid" part. And the complete idiocy of not having a clue what they were doing.

Now none of that means I don't think the government started it and owns it.

[Patrick R. Sullivan]

Did you actually see the 60 Minutes segment.

Yes, did you read the Liebowitz paper?

...he didn't discount any of those causes you mentioned.

I didn't say he did. I said he didn't mention them. Instead he just jumped to the middle of the story, because if he starts at the beginning Wall Street's roll becomes more understandable.

He also didn't mention that investors looked at Fannie and Freddie's role and said 'These are guaranteed by the US govt.'. That turned out to be correct. So, where's the stupidity?

[glasater]

Krugman has found some cohorts.

[Jane]

Yes, did you read the Liebowitz paper?

NO, I'm clearly out of my league.

I think his point was not that they were stupid, just didn't care about the consequences. ANd you can argue that either way. I think it interesting that you don't find him credible and am interested in why. TBH I think 60 Minutes is completely untrustworthy and agenda driven, I just don't enough about it to know why in this case.

[Melinda Romanoff]

Jane-

PRS has it right. The circumstances that led to where we are now all started with "good intentions".

Michael Lewis has been a bit of an opportunist in "seeing" this crisis from the beginning. Dr. Liebowitz's paper is very thorough and very good. Lewis, on the other hand, was one of the first writers to catch on to what was happening by how his normal contacts were freaking out, and by knowing how the game was played on "The Street". A big difference.

I could bore you to death with the details.

So I won't!

[Patrick R. Sullivan]

The Liebowitz paper isn't out of your league, Jane, Stan doesn't write in economese. You could get your feet wet watching a guy who really is out of his league sitting next to Stan here.

[Jane]

Well I still found it interesting.

[Patrick R. Sullivan]

Also, David Warsh has a timely column today, reviewing Michael Lewis' book and two others:

Lewis elevates a one-eyed physician-turned-hedge-fund operator named Michael Burry to a starring role, along with stock analyst turned hedge-fund manager Steve Eisman and a handful of others who discovered credit default swaps and used them to bet against the housing marker. Burry plays a subordinate role in Zuckerman’s account, because he gets the timing of his trade wrong. Such is the joy in Lewis’s telling of the story that it doesn’t matter – hubris is everywhere. ....

The point is credit default swaps turned out to be an excellent vehicle for a ventilating a difference of opinion – not about a horse race, but about the housing bubble and the subprime mortgage bender that fueled it. They are how we got the bad news, once mortgage defaults began to rise and, if they had been more familiar and better understood, might have communicated the bad news earlier, perhaps even soon enough to prevent the meltdown that ensued.

Warsh gets it right, the CDS are the messenger that bore the bad news. Michael Lewis acts like he wants to kill that messenger.

[Melinda Romanoff]

I disagree PRS, a CDS is the shadow of the trade.

They are merely a reflection of the underlying instrument, and, due to net/net games, there was frequently no money down on the actual CDS contracts.

The Lehman report by Valukas is a great learning opportunity for those who choose to dive into 300 pages of financial gruel.

[Melinda Romanoff]

Jane and Patrick-

Read this.

Summates a lot of what you are covering.

[Ignatz]

--They are how we got the bad news, once mortgage defaults began to rise...--

Seems to me the rising mortgage defaults functioned as a bit of news all by themselves, as they always have, and the CDSs functioned more as a fire extinguisher full of lighter fluid.

[narciso]

What did they think was going to happen when they leverage so much interest sensitive debt
and they you pop it, with escalating interest
rates and high energy prices, that crowd out
disposablr income

[Rick Ballard]

Ignatz,

The thesis cited in the WSJ article linked by Mel provides some foundation for the term "bankster". She could have entitled it "Algorithms Gone Wild" or "Three Monkey Credit Rating 'R Us". I suppose the major American, Swiss and German investment banks could plead mutual ignorance backed by a herd mentality and leavened with a bit of stupidity but they had better hope that I'm not on any jury deciding their fate.

I wonder if Ernst & Young will make it through. I also wonder if the Feds are going to take Sarbox seriously and let Fuld make a full and complete explanation of what his signature meant wrt attestation that all required disclosures had been made.

[Melinda Romanoff]

Rick-

I think the "Big Accounting" model is done, and FASB is the anchor dragging them all over the edge.

It was, and still is, systemic, and it is not going away soon.

It will take time and diligence, but it's not over by a long shot.

G'night all.

[Patrick R. Sullivan]

Barnett-Hart, a 24-year-old financial analyst at a large New York investment bank.

Great research skills by Michael Lewis, relying on a Bachelor thesis.

[Sean P]

If one were trying to read Krugman charitably, with an eye towards resolving any apparent inconsistencies, one COULD argue that China's leverage over the US is less because Obama, unlike Bush, doesn't care one whit whether North Korea dismantles its nuclear program or even if they launch it. Of course, I suspect Krugman would never admit to this, seeing as how dangerously misguided it would make Obama look.

[Clarice]

NEW HC THREAD ...OTHER ONE IS TOO LONG.

[DrJ]

I'm in!

[Clarice]

RUSH: NRO IT'S A COIN TOSS --REPS NEED 7 OF THE UNDECIDEDS TO DEFEAT THIS.

[centralcal]

new (old) thread - yippee. Yeah, Clarice, I am listening to Rush too.

[MikeS]

We are being mislead into this health care quagmire by tricks and lies that were cooked up years ago in Chicago in the offices of SEIU and Acorn.

[To Bad. So sad. Your 'Dad's']

Six of the last seven threads have averaged just over 400 comments. This one, Krugman bashing, was the outlier.
======================

[My cat was curious what was the matter with my face.]

Meh, that was supposed to be 'Your Dad's now glad'.
============

[Sue]

Who are the 7? Do we know?

[Sue]

Drudge says that there are 100,000 phone calls per hour to Congress. Do you really think those are people wanting them to vote yes? I don't.

[Clarice]

COLUMBIA, S.C. -- Top prosecutors in South Carolina and Florida said Friday they are ready to sue if health care reform legislation passes this weekend as expected. South Carolina Attorney General Henry McMaster said he and Florida Attorney General Bill McCollum will file a federal lawsuit challenging the bill's constitutionality. "We are ready to kill it," McMaster said. "When the national government and Congress start going wild, it's up the states to rein them in." The U.S. House plans to vote on the plan Sunday. McMaster and McCollum will argue that it violates state sovereignty

[Pagar]

The healthbill hasn't even been passed yet and already we are moving backwards.

[It takes a village to attract a horde. This one's idiot is Paul, who lives by the Wall.]

The Mongol Horde just galloped off to take another village.
==================

[narciso]

It has felt like seven years, on that thread
in the last day and a half, like time dilation
near the speed of light

[My Dad used to ask waitress what color of pie they had. Most of 'em knew.]

Like the color of Pi to the 220 thousandth digit?
==============

[narciso]

I thought we agreed to round pi down to 3

[Old Lurker]

Hi guys!

[centralcal]

Hey, OL - a lot roomier over here, no?

[Sue]

15,000 new IRS workers to make sure we comply with the healthcare mandate. If that doesn't scare John Q. Public, I don't know what will.

[SWarren]

From the other thread Re that lady that called Rush all excited about the 20% of the House can demand a recorded vote. Rush was incredulous about what she said and called Mark Levin who explained very simply why that can't be challenged. .

He had the best legal minds look at it and the kicker is that 20% call for Yea and Nay clause only applies if they are voting to pass a BILL, not a RULE.

In the case of HCR they are not voting on a BILL but on a House rule (Slaughter) by which they will deem the BIll passed.

I think that is just what DoT was saying the other day.

[Old Lurker]

Whew. You can say that again. We need to get TM to grant a power of attorney to Clarice so she can start a new open thread when Tom's away from the wheel!

[pagar]

If you thought whatever garbage CBO is putting out was too Rosy Legal insurrection says
the new immigration bill will blow the number away.

Immigration Proposal Will Blow Out All HCR Cost Estimates

While you're at the link go to the top left corner and look for the link to:

Cpl Jonathan Daniel Porto another of our finest is going. May God comfort his wife and family.

[JeanD]

Since this is just a little bitty thread by comparison, I thought I might jump in with this.

Yesterday, Clarice and Thomas Collins nominated, seconded, and, of course, deemed my selection as official JOM letter writer. I am humbled, and grateful that we didn't have any pesty investigations into my left-handedness or prior tax filings.

Nonetheless, I am nervous about eating up space or time with my latest rant to my Congress weasel, since we didn't actually have a vote, and I am a freshman member of this august body.

I offer it anyway, because it is my strange, but heartfelt, tribute to Sue. If it should not be sent to my weasel, or if my nomination is revoked, I shall accept your judgment and say no more:

Sir:

I realize that you are really busy today: fending off voters who want you to stop waffling and just guarantee that NO does, in fact, mean NO and will still mean NO on Sunday; paging through Speaker Pelosi's Catalog of Bribes, Freebies, Ambassadorships, Foundations and Miscellaneous Sinecures; contemplating the flight plan for your promised ride on Air Force 1; or, getting your dislocated arm or
other "non-compliance injury" treated at Walter Reed Hospital, so I won't take up much of your time.

What I was wondering is if you could free up a little time on your schedule in the next few weeks, should the Senate bill be considered passed Sunday as affirmed by the Congressional goat entrail
reader/parliamentarian.

I ask because I am going to need you to borrow Speaker Pelosi's private-junket-and-party plane to make a quick trip. Here's my proposed itinerary:

First: to Cincinnati to tell my elderly mom that she won't be getting Medicare Advantage anymore. (She'll hate this, but she's a pretty nice lady, so she probably won't swear at you.)

Oh, and you also need to tell her that you are strenthening her Medicare benefit by stripping $535 billion from that almost bankrupt program and pretending that those "savings" can be used for several other benefits in other places. (This one could be tricky, though, because my mom graduated at the top of her class in business school and really gets the accounting stuff. She's crafty that way. So, good luck!)

And, you have to slip in the good news that the years of private long term care insurance that she has paid for were just for naught, cause under the "new" rules, only Kathleen Sebelius gets to control that, too. (Here, you could just remind her that "good guys don't always win." If that doesn't work, you might tell her that it's "for the children," but I caution against that. It might remind her that her
grandchildren will be saddled with an unsustainable burden from this foolishness, and then she might rant. Also, she might remember that her fly-over country grandkids won't necessarily be popular with the new College Czar. After all, she has voted for Republicans before. Not pretty. So, good luck!)

You should probably grab a quick lunch before hitting the other side of town to see my sister and my brother.

You'll need to tell my sister that she had better not get pregnant again, unless she is going to do a better job of it. After all, her first baby was a preemie in a NICU, and that kind of expense isn't
going to work out anymore. (My advice here is just to yell it from the front porch. Otherwise, things might turn ugly. She's a practicing Catholic, if you get my drift. So what if she had insurance? That was the "old" insurance.)

Okay, so that went pretty well.

Now, off to my brother's house, and I gotta warn you, this one is very tricky. My brother is smarter than you, he has worked harder than you, and he has risen to the top of a Fortune 500 company by producing results. It is a health industry company. (I suggest you first apologize for the relentless demonizing of his industry, and hope that he was too busy working his butt off to notice that that vilification continued on this very day. Maybe that will set a good tone?)

When he tells you about his eight year old son who was diagnosed with an aggressive glioblastoma on his brain stem two years ago and was given only 10 days to live, do not mistake this for a ploy. It is a
fact, and the other fact is that gifted, compassionate professionals, and modern, state of the art medical treatment have kept this boy alive, engaged, and joyful.

So, as I said, it might be tricky to explain to him how the ruination of his industry and career will be a benefit. (Also, talk really fast when you explain to him that, as a member of the "rich," he will be paying a lot more, both in income taxes and future insurance premiums. Good luck!)

Finally, you need to fly to Miami and tell my internist brother-in-law that he is now a government drone and that his new bosses will be in touch. And, if you have the time, tell my sister that the high-risk
Medicaid kids and families that she handles through Dade County will have to "learn to share." (Neither of them will take it very well, and it will be a sad loss to their community when both decide to abandon
their professions, but what the heck. They can make room for all of the new professionals just quivering to serve the State.)

Since I know this is a busy schedule, you don't have to come to my house and explain why my privately purchased high-deductible policy "just won't do." I already know what you and your colleagues have done
to my freedom and don't need a taxpayer funded explanation from you.

If you don't want to take this trip, VOTE NO!

Your friend, Jean

So, too much?

[maryrose]

I like this thread better. Basketball games
are really awesome. Glad to hear some good news from Rush. Ohio has the most undecided -they listed them today in the Plain Dealer. We'll see what happens.We will gladly vote them out in November.

[Sue]

Jean,

I love it. And no, I don't think it is too much.

[pagar]

In my 02:52 PM,I incorrectly used the word going. The correct information is that Cpl Jonathan Daniel Porto HAS made the Supreme Sacrifice for his Nation

I'll bet you can't read this with completely dry eyes.

"I will always be a Marine wife"

[Clarice]

JEAN, SUBMIT THAT TO EDITOR AT AMERICAN THINKER DOT COM ..Tell em I sent you.

[Ignatz]

--He had the best legal minds look at it and the kicker is that 20% call for Yea and Nay clause only applies if they are voting to pass a BILL, not a RULE.--

How do they know that?
Article 1 section 5 says "...and the yeas and nays of the members of either House on any question shall, at the desire of one fifth of those present, be entered on the journal..."

Her point, and she was a former assistant AG for many years, was that the denial of a right to have the yeas and nays directly on the Senate bill defied the above article and section, which would seem to sidestep Levin's point.
The Dem's counter no doubt is that a yea or nay on a rule purporting to deem a bill passed is the equivalent of passage of the bill itself.

[MaryD]

JeanD, your letter is fabulous.

[SWarren]

Barack Hates This

Rush urged that we go to this site and let our voices be heard. LUN

[Ignatz]

Her other point was that the general granting of the right to make it's own rules did not allow the House to make rules in violation of the specific instructions in Art 1 Sec 5 I cited above regarding the yeas and nays.

[centralcal]

Great letter, Jean!

SWarren, you forgot your LUN :)

[peter]

I haven't been on this much of an emotional roller coaster since Gore tried to steal the White House in 2000. As of twenty minutes ago, Riehl World View gives me some tiny bit of optimism. God Damn you, Obam, you illegitimate despot. Putting the entire country through this stress just so you could put a feather in your cap.

[SWarren]

Oops. LUN

[Sue]

Hannity just said that the CBO is saying they will not be able to score the bill before they vote Sunday. Excuse me????? Surely I misunderstood.

[jimmyk]

Hannity just said that the CBO is saying they will not be able to score the bill before they vote Sunday.

I'm still confused. Where are all these "changes" to the bill coming from if the House has to vote on the bill as it passed the Senate, verbatim? Or is all this new stuff in the reconciliation bill?

[Janet]

There was a short video linked by Instapundit showing some protesters outside where Obama was speaking in Fairfax, VA. I recognized some of the people from my church! God bless em!!

[Clarice]

The scam is that they are preending to be voting for the recon bill, when in fact it is wrapped around the Senate Bill which will be dismembered from the pkg. But it is a hoist on her own petard for Nancy if the GBO cannot score it before the vote--I recall that was a promise, no?

[DrJ]

Or is all this new stuff in the reconciliation bill?

That's how I read it. All the last-minute horse trading in the reconciliation portion can't be scored in time. The Senate portion stands as passed in the Senate. I've no idea if the college financing package has changed recently, either.

[Clarice]

Ben Chandler (Ky) voting NO. Was listed as Undecided.

[Sue]

Boyd, D-FL is voting yes. Was a no last time. Panhandle of Florida democrat.

[Sue]

Bad: RT @jmartpolitico: As in Allen Boyd, blue dog from FL panhandle RT: @Eric_Jotkoff BREAKING: Boyd to support health care reform

[Clarice]

WS says Pelosi doesn't have the votes:

John Boccieri becomes the fourth Democrat who voted against the health care bill in November to flip his vote to "yes". He joins Betsy Markey, Bart Gordon, and Dennis Kucinich. I expect Scott Murphy of New York to become the fifth soon. Other potential flippers from "no" to "yes" include Suzanne Kosmas (Fla.), Brian Baird (Wash.), Jim Matheson (Utah), and Jason Altmire (Pa.).

But there's good news (I think): Peter DeFazio just announced he's flipping from Yes to No. And even if Pelosi can flip ten "no" votes to "yes," she's still short. Here's why.

If the number of Democrats who flip from "yes" to "no" is greater than the number who flip from "no" to "yes," the bill will be defeated.

Bart Stupak's coalition of pro-life Democrats is larger than many had assumed. While Stupak has claimed to have a dozen members willing to flip from "yes" to "no," most Democrats assumed he only had five. I think Stupak has at least nine Democrats in his coalition. Yes, I know politicians can go back on their word, but House leadership is still frantically trying to cut a deal with Stupak, which indicates they don't have the votes.

The Stupak coalition includes:

1. Bart Stupak (Mich.)
2. Dan Lipinski (Ill.)
3. Joe Donnelly (Ind.)
4. Kathy Dahlkemper (Pa.)
5. Jerry Costello (Ill.)
6. Steve Driehaus (Ohio)
7. Marion Berry (Ark.)
8. Brad Ellsworth (Ind.) (He's given mixed signals, but it would be hard to break from Donnelly/win the general Senate election while abandoning Stupak.)
9. Nick Rahall (W.V.)

Rahall's announcement just today of an ultimatum on abortion makes it very difficult for fellow West Virginian Alan Mollohan to vote for the bill. Other potential members of the Stupak coalition:

* Henry Cuellar (Tex.) has given mixed signals.

* Marcy Kaptur has given mixed signals, but her latest remarks make it seem that she might stick with Stupak.

* Chris Carney (Pa.) had a strong statement about opposing federal funding of abortion but didn't specify whether he was talking about Stupak.

KLo says Stupak deal impossible

NROor Anyone Thinking a Stupak Deal Could Work [Kathryn Jean Lopez]
One Senate source confirms: "A bill like that is just not going to happen. Dems would filibuster. We had a vote on Stupak language over here; it got 45 votes (needs 60). Not going to happen."

And an off-the-Hill counter points out: "Only 45 Democrats supported the Stupak language — which is why it wasn't in the Senate version of the bill." The source continues: "Any fix, if a fix were possible, would involve 45 Ds and 15Rs. A totally impossibility. "

[Sue]

Commenters at Ace are saying the "pocket votes" are being outed. She didn't have the votes.

Damn sons of bitches.

[Sue]

Florida Democrat Allen Boyd – a leader of the House Blue Dogs – has flipped from his firm "no" position and will vote "yes" on the House health care vote this Sunday, the Tallahassee Democrat is reporting.

Damn.

[Porchlight]

Yeah, I just don't see what they can give Stupak that would make a difference, assuming he isn't just holding out for the fun of it, and I really don't think he is at this point. It's got to be a real deal.

Don't know if that holds true for the rest of his gang, though.

[Clarice]

Stupak may be a real hero.Pray for him.

[Rick Ballard]

"She didn't have the votes."

Still doesn't and probably won't. Botoxic Kool-Aid just isn't the drink of choice for moderate Dems.

On to Copenhagen III!

[SWarren]

Ignatz,
The Dem's counter no doubt is that a yea or nay on a rule purporting to deem a bill passed is the equivalent of passage of the bill itself.

IANAL but I think this is Levin's point - there is no Bill.
In Levin's lawsuit which he will file the minute the House votes, argues that the passing of Slaughter Rule does not constitute a vote for the Bill. He argues that using Slaughter abrogates the Bicameral Clause.

Am I reading it right?

Levin's Draft LUN.

[Porchlight]

Obama finally under water in RCP job approval average. About flipping time.

[Clarice]

I think that's his point, SW.
Let's hope we needn't test it.

Or any of the other constitutional issues raised in this legislation like racial preferences, violation of the rules of federalism, lack of a constitutional way to mandate individuals buy insurance.

[glasater]

Jean--What a wonderful letter!

you don't have to come to my house and explain why my privately purchased high-deductible policy "just won't do."

Points directly to the dilemma my better half and I are in....

[Porchlight]

Sue, thanks for mentioning Ace - this update from Gabriel M. is worth reading:

Mid-Day Spine Stiffener

[glasater]

I called Congressman Cao's LA office and asked the staffer if he would convey to the congressman to please vote No on hcr.
The staffer asked what zip code I was in and when I told him--he said "have a nice day" and hung up:-)

Also called Baird's office and got through with the same message.

[Clarice]

AOS's Spine stiffener's too good not to repeat entirely.

olks, you are effing pussies. As of this morning, Pelosi had 192 members "definitely voting yes." She was 24 votes shy and there were 28 maybes.

After "yeses" from Boyd, Boccieri, Titus, Perriello and a "no" from DeFazio she's at 195 members voting yes. She's 21 votes shy and there are 24 maybes left. This isn't bad. Guess what, puddin' heads: the race was always going to get tighter before it was finished. Big, giant DUH.

Now, sure, all those maybes are Democrats, which means their natural tendency will be to stick together. Going against that tendency is their individual desires to get reelected and the certain asswhoopin they're going to get in November as a result of voting in favor of this bill.

Pelosi can definitely do this. I'm not saying that we're going to win. But it is far from clear that we're going to lose at this point. She and Hoyer are still racing around trying beg, buy, and steal votes. MoveOn just sent out an "emergency" message trying to gin up support.

A reminder once again, Fox News' "whip count" which supposedly places Pelosi one vote away from 216 has no basis in reality. No other whip counts on either the right or the left have things that close. We don't have it that close because too many members keep saying they are undecided. Fox is making too many unexplained assumptions.

Also, all this "OMG they switched from 'no' to 'yes'" is also unhelpful. Divorce in your mind any member's November "no" vote from anything they are doing now. They're not flipping "no" to "yes." At least, it's not any worse than a "yes" staying "yes." All that matters is the total 216 votes, not where they get them from. It's not like we're going to lose if we don't get a certain amount of "no" votes. What does it matter? Remember, several "yes-in-November" votes have become "no-in-March" votes. Doesn't mean anything except: (1) this is a different bill; and (2) the political environment is vastly changed.

Instant Update: And even as I wrote this, Altmire confirmed that he's voting no. That brings the maybes down to 23. Guess what, three more declare for us and Pelosi cannot reach 216! Smile, it's not over yet.

And be sure and read FDL whip count's latest pre-Altmire update He's also coming up with a three-vote deficit being the margin.

[Janet]

The Ace of Spades crew can almost always make me feel better. Even if the news is horrible the commenters can give a good cussin to the bad guys!

[Old Lurker]

And another Mid Day Spine Stiffiner LUN

[Pagar]

New Zeal Blog says that the reason Obama doesn't care if the Healthcare bill destroys the Democrats is because Obama owes the groups who got him Elected more than he does the Democrats.

"The reality is that President Obama owes his success and his hold on power more to three Marxist groups than he does to the Democrats.

The three organizations, Communist Party USA, Committees of Correspondence for Democracy and Socialism and Democratic Socialists of America, all worked with Barack Obama for years and helped get him elected."

IMO, the demise of the Democrats will strengthen these Communist groups.

[Clarice]

HEH OL. Is the sun over the yardarm where you are?

Janet, I read the Bill takes on a 50% hike in insurance premiums for smokers.

[peter]

good news at LUN Altmire of Pennsylvania is a no

[Old Lurker]

"Is the sun over the yardarm where you are?"

As they say in the Navy...it is somewhere.

Seriously, we follow a strict 6PM rule at home but this HCR stuff is causing me to rethink that.

[Porchlight]

It is great news - I thought Altmire would end up a yes...

[centralcal]

Yep, OL, that is my spine stiffener each night when I get home from work - two brandy Manhattan's. I dispensed with the bitters a few years ago and don't miss them at all.

[peter]

Brandy Manhattans! How does that differ from a sidecar, exactly?

[Porchlight]

This comment at HotAir gave me a laugh earlier today, in case anyone else is needing some levity:

They might think they have the votes on paper, but remember folks – it’s like basketball games – they’re not played on paper, but inside TV sets.

fossten on March 19, 2010 at 1:23 PM

[Pops]

Catepillar Inc. reports the Obamacare will cost them 100 MILLION the 1st year.

Look for more lay-offs.

Alot of others will get wacked as well. If this passes, unemployment will be 12% by Christmas