Matthews is writing Wonkbook while Ezra is on vacation.
Five in the morning
1) The House will vote on a clean debt limit increase today, reports Paul Kane: 'Setting the stage for a long summer of heated negotiations, the House is expected to reject a proposal Tuesday that would increase the nation’s ability to borrow money without also making major cuts in federal spending. A day before they huddle with President Obama at the White House, Republicans will vote on the administration’s initial request that the nation’s $14.3 trillion debt ceiling be lifted without any accompanying spending reductions. Both sides now recognize that such a request is politically impossible...GOP House leaders timed the vote Tuesday night to demonstrate that point before all 241 members of the Republican conference visit Obama on Wednesday.'
2) Mitch McConnell will only back a debt limit increase if it includes Medicare cuts, reports Joseph White: 'Senate Minority Leader Mitch McConnell (R., Ky.) said he won’t support a deal to raise the U.S. federal debt ceiling unless it restrains the growth of Medicare spending, but in an interview aired Sunday on NBC he left open what form that deal could take. 'To get my vote on the debt ceiling..Medicare will be a part of it,' Mr. McConnell said on NBC’s 'Meet the Press,' in response to questions from host David Gregory...Mr. McConnell said a bipartisan deal to resolve the Medicare and debt issues is possible, and drew a parallel between the current budget battle and the early 1980s agreement between President Ronald Reagan and the Democratic Speaker of the House Tip O’Neill that bolstered Social Security.'
3) Democrats plan on running on the auto bailout in 2012, report Sharon Terlep and Jeff Bennett: 'Midwestern auto-industry towns that were hit hard in the recession are becoming an important backdrop for President Barack Obama and other Democrats hoping to use reinvigorated factories to paint a picture of the improving economy ahead of the 2012 elections...Ohio Democratic Sen. Sherrod Brown, who is up for re-election, said the Democrats campaigning in the Midwest would cite the auto makers' rebound to repel Republican criticism...The auto industry's rebound poses a challenge for Republicans because many of them argued against using $80 billion in taxpayer dollars to try to save General Motors Co., Chrysler and many of their suppliers.'
4) Some prominent GOP governors are charging ahead on health reform, reports Sarah Kliff: 'A small but growing number of prominent, Republican governors -- including Mitch Daniels and Haley Barbour -- are taking the lead to shape a key component of the health care overhaul their party fought so hard to kill...Wisconsin, under the leadership of Gov. Scott Walker, is one of six states to win an Early Innovator grant. While the grant was received under Walker’s predecessor, Gov. Jim Doyle, Walker has continued to use the resource...Daniels, Walker and Barbour are a stark contrast to Republican governors who are more stridently opposed to all aspects of health reform. Govs. Rick Scott of Florida, Bobby Jindal of Louisiana, and Susana Martinez of New Mexico have come out in fierce opposition of any kind of implementation.'
5) House prices are creeping ever-lower, reports David Streitfeld: "Even as the economy began to fitfully recover in the last year, the percentage of homeowners dropped sharply, to 66.4 percent, from a peak of 69.2 percent in 2004. The ownership rate is now back to the level of 1998, and some housing experts say it could decline to the level of the 1980s or even earlier. Disenchantment with real estate is bound to swell further on Tuesday when the most widely watched housing index is all but guaranteed to show that prices of existing homes sank in March below the lows reached two years ago -- until now the bottom of the housing crash. In February, the Standard & Poor’s/Case-Shiller index of 20 large cities slumped for the seventh month in a row."
'90s alt-rock interlude:
Weezer plays 'Paranoid Android' by Radiohead.
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Still to come: Cutting tax breaks for retirement won't raise a lot of money; hospitals are fighting a new Medicare pay-for-quality plan; some businesses are upset at the Supreme Court's immigration ruling; why regulators should gear up for driverless cars; and a gosling tries its best not to fall asleep.
Economy
Cutting retirement tax breaks wouldn't save much money, reports Lori Montgomery: 'As Washington considers closing a profusion of tax breaks in its quest to reduce record budget deficits, a study suggests that some targets might produce far less cash than is commonly thought. Tax preferences for retirement plans, such as 401(k) accounts, rank among the biggest money losers for the federal government, with official projections showing a loss of about $600 billion to federal coffers over the next five years. But a study set for release this week suggests that the accounts would have to be closed, or contributions sharply limited, to realize much in the way of budget savings -- a move that could undermine some of the nation’s most popular retirement tools.'
A key Fed official wants to boost rates, reports Joseph White: 'A top Federal Reserve official says it is time to raise interest rates to avoid causing inflation and economic problems. Thomas Hoenig, president of the Federal Reserve Bank of Kansas City, in a CNN interview broadcast Sunday said the U.S. should learn lessons from the last decade when low interest rates ended up discouraging savings in the U.S. and causing economic problems...Federal Reserve Chairman Ben Bernanke earlier in May outlined a plan to gradually raise its benchmark interest rate and take other actions to tighten credit. But the Fed hasn't signaled any plan to raise key interest rates soon.'
Growth looks like it's slowing, report Sara Murray and Jon Hilsenrath: "After a disappointing first quarter, economists largely predicted the U.S. recovery would ramp back up as short-term disruptions such as higher gas prices, bad weather and supply problems in Japan subsided. But there's little indication that's happening. Manufacturing is cooling, the housing market is struggling and consumers are keeping a close eye on spending, meaning the U.S. economy might be on a slower path to full health than expected...A growing number of forecasters are downgrading their second-quarter growth predictions. JPMorgan Chase & Co. economists revised down their estimate to a 2.5% rate from 3%, while Bank of America Merrill Lynch economists cut theirs to 2% from 2.8%. Deutsche Bank cut its forecast to 3.2% from 3.7%."
The US is falling behind in general, writes EJ Dionne: 'While Americans pay less in taxes than the citizens of other rich countries -- and currently pay the smallest share of their incomes for taxes since 1958 -- one house of Congress thinks the only thing that can be done to help the country is to cut taxes even more. While other countries have jumped ahead of us in green economics, we have backed away from any effort to put a price on carbon to battle climate change and promote new technologies. In the Republican Party, politicians have to apologize for even thinking about global warming. And while other countries invest in their basic facilities, we are letting our broadband access, roads and bridges, and rail and water systems go to seed.'
There's plenty we could do to curb unemployment, writes Paul Krugman: 'Once you realize that the overhang of private debt is the problem, you realize that there are a number of things that could be done about it. For example, we could have W.P.A.-type programs putting the unemployed to work doing useful things like repairing roads -- which would also, by raising incomes, make it easier for households to pay down debt. We could have a serious program of mortgage modification, reducing the debts of troubled homeowners. We could try to get inflation back up to the 4 percent rate that prevailed during Ronald Reagan’s second term, which would help to reduce the real burden of debt.'
Adorable animals cuddling interlude:
A cat mom hugs her kitten.
Health Care
Hospitals are rebelling against the administration's Medicare pay-for-performance plan, reports Robert Pear: 'For the first time in its history, Medicare will soon track spending on millions of individual beneficiaries, reward hospitals that hold down costs and penalize those whose patients prove most expensive. The administration plans to establish 'Medicare spending per beneficiary' as a new measure of hospital performance...Hospitals could be held accountable not only for the cost of the care they provide, but also for the cost of services performed by doctors and other health care providers in the 90 days after a Medicare patient leaves the hospital. This plan has drawn fire from hospitals, which say they have little control over services provided after a patient’s discharge.'
Doctors are moving left, reports Gardiner Harris: 'Doctors were once overwhelmingly male and usually owned their own practices. They generally favored lower taxes and regularly fought lawyers to restrict patient lawsuits. Ronald Reagan came to national political prominence in part by railing against 'socialized medicine' on doctors’ behalf. But doctors are changing. They are abandoning their own practices and taking salaried jobs in hospitals, particularly in the North, but increasingly in the South as well. Half of all younger doctors are women, and that share is likely to grow...As more doctors move from business owner to shift worker, their historic alliance with the Republican Party is weakening from Maine as well as South Dakota, Arizona and Oregon, according to doctors' advocates in those and other states.'
The administration says Medicaid recipients can't sue to stop cuts, reports Robert Pear: 'Medicaid recipients and health care providers cannot sue state officials to challenge cuts in Medicaid payments, even if such cuts compromise access to health care for poor people, the Obama administration has told the Supreme Court...Federal law says Medicaid rates must be 'sufficient to enlist enough providers' so that Medicaid recipients have access to care to the same extent as the general population in an area. In a friend-of-the court brief filed Thursday in the Supreme Court, the Justice Department said that no federal law allowed private individuals to sue states to enforce this standard.'
Want more primary care doctors? Make med school free, write Peter Bach and Robert Kocher: 'Huge medical school debts -- doctors now graduate owing more than $155,000 on average, and 86 percent have some debt -- are why so many doctors shun primary care in favor of highly paid specialties, where there are incentives to give expensive treatments and order expensive tests, an important driver of rising health care costs...We estimate that we can make medical school free for roughly $2.5 billion per year -- about one-thousandth of what we spend on health care in the United States each year. What’s more, we can offset most if not all of the cost of medical school without the government’s help by charging doctors for specialty training.'
Domestic Policy
Businesses are upset at the Supremes' immigration ruling, report Miriam Jordan and Danny Yadron: 'A Supreme Court ruling this past week upholding an Arizona state law that cracks down on employers of illegal immigrants is irking some businesspeople who expect similar measures to spread to other states and threaten economic recovery in sectors that rely on unskilled workers...Thursday's ruling said Arizona could strip employers of a business license after a second violation of the Legal Arizona Workers Act, which bars hiring illegal workers. It also upheld the requirement that state employers use an electronic database system, E-Verify, to check whether new hires are eligible to work in the U.S...The Web-based E-Verify program allows businesses to check information provided by new hires against government databases.'
Obama is quietly working to improve FEMA, reports Brad Plumer: 'What has Barack Obama done to make the agency better? To his credit, he appointed as head of FEMA Craig Fugate, who had actual relevant experience directing Florida’s emergency-management division. And there are early signs that the agency is improving. Back in 2003, the Partnership for Public Service, a nonprofit, began taking surveys of federal workers, asking questions about morale, whether they have adequate resources, and how able their leaders are. Max Stier, the CEO of Partnership for Public Service, told me that these metrics may not be perfect, but they correlate pretty well with performance in the private sector.'
Food safety advocates are fretting about cuts, reports Lyndsey Layton: 'Budget cuts proposed by House Republicans to the Food and Drug Administration would undermine the agency’s ability to carry out a historic food-safety law passed by Congress just five months ago, food safety advocates say. The legislation, passed in December, is the first major change to the nation’s food-safety laws since 1938...To carry out the new law, President Obama is seeking $955 million for food safety at the FDA in the fiscal year that starts Oct. 1. Last week, the House Appropriations subcommittee that oversees the FDA pared back that amount to $750 million, which is $87 million less than the figure the agency is currently receiving for food safety.'
Voting should be a right from birth, writes Jonathan Bernstein: 'One of the strongest justifications for democracy is to aggregate interests. And, if democracy is at least partly about aggregating interests, the case for voting from birth is surprisingly strong. Under this rationale for democracy, the reason for elections has to do with a concept of fairness. If everyone is allowed to act (by voting) in their own self-interest, then policy decisions will eventually reflect their accumulated will, at least to some extent, or much better at least than if some autocratic or technocratic government made the decisions. We alone know, and judge, our own interests. But children, even infants, have interests that are as legitimate as those of anyone else.'
Education is set to change dramatically, writes Steven Pearlstein: 'You can understand why the education establishment has been in no hurry to embrace a digital future. The battles over standardized testing and adoption of common national standards were just the warm-up. Now that the opposition to them has been largely overcome, capital and creative talent will pour in to develop both the hardware and the software of the new education technology. Over the next decade, look for teaching to be transformed from an art into something much closer to a science, look for learning to become highly individualized, and look for education to go from being a cottage industry to one that takes full advantage of the economies of scale and scope. And as in every other industry, look for quality to go up and cost to go down.'
Arizona's other immigration bill is a model worth spreading, writes Ross Douthat: 'Advocates for 'comprehensive' reform, the holy grail of liberal Democrats and moderate Republicans alike, have long implied that it’s essentially impossible to prevent illegal immigrants from finding their way to eager employers...So far, though, Arizona’s E-Verify law seems to be providing a strong counterpoint to this counsel of despair. According to a recent study from the nonpartisan Public Policy Institute of California, the legislation reduced Arizona’s population of working-age illegal immigrants by about 17 percent, or roughly 92,000 people, in just a single year...These results suggest that maybe -- just maybe -- America’s immigration rate isn’t determined by forces beyond any lawmaker’s control.'
Bonus adorable animal interlude:
A gosling tries, fails to resist the call of sleep.
Energy
Regulatory barriers are preventing driverless cars, writes Tyler Cowen: 'Putting a computer behind the wheel may sound scary, but in road tests performed by Google and other companies, the cars have had a good safety record...Computer-driven cars could allow for tighter packing of vehicles on the road, which would speed traffic times and allow a given road or city to handle more cars...The driverless car is illegal in all 50 states. Google, which has been at the forefront of this particular technology, is asking the Nevada legislature to relax restrictions on the cars so it can test some of them on roads there. Unfortunately, the very necessity for this lobbying is a sign of our ambivalence toward change...Potentially major innovations need a path forward, through the current thicket of restrictions.'
Closing credits: Dylan Matthews is a student at Harvard and a researcher at The Washington Post. Wonkbook is compiled and produced with help from Michelle Williams.
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