S&P: Cut Medicare, Social Security

Nearly lost in all the media hubbub over S&P’s unprecedented decision to downgrade the US credit rating is the blatant fact that it is meddling in US politics. Robert Reich makes the obvious point that S&P’s responsibility is simply to assess whether the US is likely to pay its debts, and that it has no right to insert itself into the question of how much debt the US should decide to maintain. But even Reich does not go far enough.

What S&P is doing is to use its rating leverage to take sides in the ongoing deficit negotiations in Washington. In its justification of the downrating, S&P says (a) it wants more deficit cuts, and (b) that the problem is partisan brinksmanship in those negotiations makes it unlikely that the federal government will accept the necessary package of revenue increases, especially tax hikes, and entitlement cuts needed to attain (a).

We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process.

In other words, the downgrade is about the further negotiations regarding deficit reduction that will resume when Congress reconvenes after the August break, specifically the debate over the balance between tax hikes and entitlement cuts.

Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.

S&P says that it takes no position on how the two parties work out that balance, as long as they do cut the deficit further.

Standard & Poor's takes no position on the mix of spending and revenue measures that Congress and the Administration might conclude is appropriate for putting the U.S.'s finances on a sustainable footing.

But that is disingenuous. Everybody in Washington (save perhaps the delusional would-be bipartisans in the White House) knows that the current GOP will never allow any tax increases. Hence what S&P is really saying is it demands to see cuts to Medicare and Social Security. It is threatening to lower the nation’s credit rating even further unless the deficit is cut even further, so the message is clear: Cut entitlements.

All of us saw that Obama and the Democrats allowed themselves to be taken hostage in recent months in order to save the Treasury’s creditworthiness. Now S&P is trying its hand at the same thing.

Update, Aug. 8: Right on cue, as the NYT reports, members of Congress start worrying about how they can get back into the good graces of S&P:

The downgrade of the United States government’s credit rating by Standard & Poor’s is almost sure to increase pressure on a new Congressional “supercommittee” to mute ideological disagreements and recommend a package of deficit-reduction measures far exceeding its original goal of at least $1.5 trillion, lawmakers said Sunday.

Even before the panel is appointed, its mission is expanding. Its role is not just to cut the annual budget deficit and slow the explosive growth of federal debt but also to appease the markets and help restore the United States’ top credit rating of AAA. Otherwise, taxpayers may eventually have to pay more in interest for every dollar borrowed by the Treasury.

The report certainly got the attention of Capitol Hill.

[snip]

Credit rating agencies have thus emerged as a powerful constituency whose concerns are taken seriously by Congress.

[snip]

S.&P. did not advocate a specific mix of increased revenue and spending cuts. But it did say that overhauling entitlement programs was “key to long-term fiscal sustainability” and that the debt deal “envisions only minor policy changes on Medicare.”

The practical and foreseeable effect of S&P's action and its announcement was mainly to ramp up pressure on Democrats to concede to entitlement cuts that their constituents oppose strongly. It's hard to believe that that was not its intent. In fact S&P has a history of throwing its weight around in political matters on behalf of Wall Street interests.

crossposted at unbossed.com

Another unacknowledged edit by Jeffrey Goldberg

The more evidence turns up about Jeffrey Goldberg’s revisions of his controversial post “Mumbai Comes to Norway,” the worse his journalistic lapses look and the less satisfactory his explanation appears.

I came across a site that mirrors his Atlantic blog, perhaps using his RSS feed. It preserves two versions of his “Mumbai” post – one with “UPDATED” in its title (from late in the evening of July 22), and the other without (evidently captured earlier that afternoon at 3:22 PM ET). Here is the text of the earlier version:

I'm following news of the Norway attacks like the rest of you, and am curious to see, among other things, Norway's response. I hope it is not to pull troops out of Afghanistan; this would only breed more attacks. So, why Norway? It doesn't seem likely, on the surface. There are many countries with more troops in Afghanistan than Norway; and there are several countries whose newspapers have printed cartoons of the Prophet Muhammad. My first reaction is two-fold: 1) Jihadists did this in Norway because they could. Norway is pretty well-known among homeland-security types for being among the softer, less-defended countries of the West, and 2) Norway is making moves to expel a jihadist called Mullah Krekar, who is one of the founders of Ansar al-Islam, the al Qaeda-affiliated group that operated in Iraqi Kurdistan with some help from Saddam's intelligence services. This could be a message about his coming deportation.

Of course, asking the question, "Why did jihadists attack (x)?" could lead people to believe that these sorts of attacks are responses to particular events. They are not. At the deepest level, they are responses to Western existence. I know that this sort of statement sounds too Bushian for some people, but I tend to think that many hardcore jihadists -- i.e. ones who are willing to murder innocent people -- develop a deep desire to murder infidels, and only then go looking for specific places to do this murder, and only then gin-up weak rationalizations for the murder. In other words, the list of ostensible grievances is endless.

This version differs from the original piece, posted half an hour earlier. The second paragraph is longer; everything after “Western existence” was added after the original post went up. Notice that this addition is not labeled an ‘update’.

This calls into further doubt Goldberg’s explanation of events. When he learned that I’d turned up evidence of an unacknowledged update to “Mumbai” in which he added material down through its third paragraph (with its alternative theory for the Norway attacks), you may recall, Goldberg quickly added an update to “Mumbai” stating:

(a) that he appended the ‘caveat’ in the third paragraph right after he originally posted “Mumbai” (“I wrote it almost right after I posted originally”)

(b) that he did initially label this addition as an ‘update’

(c) that a subsequent revision of “Mumbai”, because of obscure technical difficulties, accidentally deleted the update label in (b)

This new evidence is hard to square with that story. (i) It shows that there were at least two updates before the third paragraph was added, not one nearly immediate update as Goldberg implied. (ii) The first of these revisions (some 10 to 30 minutes after the original post) was not in fact labeled as an ‘update’, nor was the title of the post. (iii) A further revision (appending the third paragraph) came more than half an hour after the original post, not quickly as Goldberg said. So Goldberg’s account of his revisions of “Mumbai” is in tatters. We also have clear evidence that Goldberg did append some material to his original post without acknowledging the revision.

It’s also worth underlining that Goldberg’s first inclination after he wrote “Mumbai” was to go back to expand and emphasize the unequivocal blame he was heaping on jihadists. So the third paragraph, whenever it finally was added, was an even greater reversal than it had originally seemed (when we didn’t know of this first unacknowledged update).

Notice too that the clause Goldberg inserted surreptitiously in the first paragraph (“if this is jihadist in origin”) is not present yet in this first revision of “Mumbai”. That means very likely it was inserted at the same time as the third paragraph was added. In other words, it’s even clearer now that the inserted clause was meant to work together with the third paragraph in helping to deflect criticism that he had rushed to judgment.

As always, it will be interesting to see whether Jeffrey Goldberg attempts to explain the ever-widening confusion about the history of his revisions of this extraordinary post.

Jeffrey Goldberg busted

For the last ten days Atlantic writer Jeffrey Goldberg has struggled to explain how an inflammatory post he published on July 22 was radically altered subsequently to make it seem less imbalanced – without however alerting readers that it had been changed. Goldberg initially blamed the Norway attacks unequivocally on Muslim terrorists. But then as events that Friday were demonstrating how foolish his rush to judgment had been he appended seven new sentences to the original post, raising the possibility of right-wing terrorism and suggesting that all along he was just exploring various theories about who was responsible. Three days later, when Goldberg learned that I’d turned up evidence to show that he’d revised his post without acknowledgment, he went back to the post and added a nearly incomprehensible and dubious update explaning how that transpired. When this ‘gibberish update’ was greeted derisively by various journalists, he quietly slipped yet another explanation into the post briefly restating his version of events and accusing his critics of trying to undermine him for ideological reasons (I call this one his ‘Checkers update’).

Goldberg has maintained throughout – in vague terms – that misleading readers was entirely unintentional and the product of a single technical glitch. Goldberg claims that he originally did set the additional seven sentences apart, preceded by the label “UPDATE”, but later in the day when he appended a further ‘update’ the original label was accidentally omitted.

I’ve found no evidence to back up his story and have provided several grounds for doubting his explanation of events. Furthermore, although Goldberg promised in the ‘gibberish update’ to look into the electronic trail of his various updates to the post and thus clarify what actually transpired, he hasn’t said a word since then about it. I've pointed out repeatedly that he could simply use The Atlantic’s logs to show how his post changed over time. Goldberg has never responded to that suggestion or brought forward any actual evidence beyond his own assertions. His integrity and that of The Atlantic have been called into question, and he has declined to rebut the allegation in detail. Indeed, Goldberg has said that it is his critics who need to prove his story is false.

Well, a serious hole in his story just showed up. It was raised by commenter ‘Robinisms’ at my original post on the Goldberg scandal, who noted another telling (but until then overlooked) change Goldberg made to his original post: Goldberg inserted a new clause into the middle of his first paragraph. This insertion clearly was designed to make his original post seem more circumspect; it adds an element of caution to a paragraph that originally lacked it entirely. It is a change that Goldberg’s explanation plainly does not justify.

I quote the entire post as originally published:

I'm following news of the Norway attacks like the rest of you, and am curious to see, among other things, Norway's response. I hope it is not to pull troops out of Afghanistan; this would only breed more attacks. So, why Norway? It doesn't seem likely, on the surface. There are many countries with more troops in Afghanistan than Norway; and there are several countries whose newspapers have printed cartoons of the Prophet Muhammad. My first reaction is two-fold: 1) Jihadists did this in Norway because they could. Norway is pretty well-known among homeland-security types for being among the softer, less-defended countries of the West, and 2) Norway is making moves to expel a jihadist called Mullah Krekar, who is one of the founders of Ansar al-Islam, the al Qaeda-affiliated group that operated in Iraqi Kurdistan with some help from Saddam's intelligence services. This could be a message about his coming deportation.

Of course, asking the question, "Why did jihadists attack (x)?" could lead people to believe that these sorts of attacks are responses to particular events. They are not. At the deepest level, they are responses to Western existence.

When Goldberg appended the seven new sentences later that day, these original sentences remained the same with a single exception. He slipped a new clause into the fourth sentence of the first paragraph, which he did not mark in any way as a revision:

It doesn't seem likely, on the surface, if this is jihadist in origin.

The new clause turned the first two paragraphs of the post into a hypothetical exercise, which they had not been in the original. So even if Goldberg did add “UPDATE” before the long section he appended, as he claims, he had doctored the original post sufficiently with the surreptitious insertion of this clause that he might have hoped to deflect criticisms that he had rushed to judgment.

I see no way that Goldberg can explain away this clause under his current story, except by making it even more baroque than it already is.

The very surreptitiousness of this insertion tends to strengthen my original impression that Goldberg's unacknowledged revision was meant to mislead readers.