MA Think Tank: Romneycare Added Less Than 1% to State Budget

Forbes has an interesting story up that includes an interview with Michael Widmer, president of the nonpartisan Massachusetts Taxpayers Foundation.  Widmer says that Romneycare added about $100 million to the state budget:

To pay for extra coverage, however, the state had to find an additional $350 million from its own budget. On balance, RomneyCare costs Massachusetts an extra $100 million a year from its state budget. “Not bad for a state with a $30 billion budget,” Widmer said. 

So, based on this analysis, Romneycare added 0.3% to the state budget----that's hardly a budget-buster.

Combining those numbers with the possibility that Romneycare may have actually slowed the rate of health-care spending growth in Massachusetts, one might suggest that more research into the effects of the law may be warranted.

Showdown in Jacksonville

A few brief points on tonight's debate:

• Gingrich built up a lot of expectations going into the debate, but he often seemed unable to counter Romney's jabs.  His attempt to turn the debate on Wolf Blitzer spun back at him.  These increased expectations made his uneven debate performance seem like more of a defeat.
• Santorum stole some of Gingrich's thunder in his attacks on Romney.  With Gingrich losing support by the day (if recent polling is to be believed), Santorum may find himself gaining in this race.  It might be too early to count Santorum out.
• This was a good night for Romney.  He pushed at Gingrich in a focused, yet restrained, way.  He didn't seem blustery (for the most part) but in command of details and facts.  He often caused Gingrich to back down and swung hard at Barack Obama.  This was one of Romney's sharpest debates.

Thematic Foundations

Mitt Romney has promised to make a forceful argument against Newt Gingrich in order to rehabilitate his campaign, which has recently hit a South Carolina-sized pothole.  Here are some thoughts on what Romney could do to revive his campaign.

Perhaps the most crucial thing that Romney can do is to unite the disparate aspects of his campaign into a focused, principled message.  Romney is known as a devotee of arcane details, and that facility with information may prove useful in governing, but now might be the time to sell a more focused campaign theme.  Romney's team has, I think, been moving in this direction, but it's been knocked off course a little by the Gingrich surge (especially by the tax returns issue, as even Romney advisor Stu Stevens admits).

Many sense that the sotto voce theme of Romney's campaign is his electability, but that empirical principle is not enough to win a primary, especially in a party with a base that enthusiastically replaced Mike Castle with Christine O'Donnell in Delaware in 2010.  Romney's competence with complex administrative apparatuses is also a good selling point, but claims of competence immediately draw the eye to questions of principle: to what ends will this technocratic skill be put?

I've suggested before that Romney could argue persuasively on behalf of a pro-growth, pro-middle class conservatism.  By fighting for a tighter labor market (through tackling trade and immigration issues), Romney could in turn encourage new growth for the middle and working classes, which have increasingly been left behind.  It is possible for conservatives to be concerned about income inequality and stagnating social mobility and to make a conservative case for improving the opportunities for the poor and middle class.

Despite what the media (and some right-leaning pundits) may claim, "progressives" do not have a monopoly on those issues.  Indeed, the kind of expansionist government that "progressives" often desire has only seen its power grow due to income inequality and economic stagnation.  Moreover, the later Bush and Obama years have shown that those who control massive amounts of wealth can gain the most through an expansionist central government: they alone know how to manipulate the government system to make the most for themselves.  There's a reason why GE paid less in corporate taxes (i.e., nothing) than the average business.

A strong case can be made for restoring economic vitality by cutting burdensome regulations, investing in infrastructure and human capital, aggressively protecting US economic interests abroad, putting the financial industry on sound footing, and incentivizing economically productive activities.  And Romney could be just the man to make it.  His experience in the corporate world demonstrates his utter intimacy with the tendencies of modern business---the good and the bad.  His economic policies go beyond tax cuts; for Romney (unlike for some GOP candidates), every economic problem is not a nail waiting for a tax-cut hammer.

The idea would be to run on a platform of restoring economic hope.  That would mean restoring economic growth and pushing for reforms that would help more of the American people benefit from the gains of growth; these two goals are complementary.  With some of his speeches, Romney seems to be edging in this direction, but more emphasis could be placed on the hope of increasing opportunity.  The real political topic at issue is not how much in taxes Romney has legally paid but how to reform the political-economic structure in order to give the opportunity to more Americans to make it to the higher tax brackets and to ensure that even those in lower tax brackets can have some kind of economic security.

It's probably not time for the Romney campaign to hit the panic button yet; if the media senses more blood in the water, a feeding frenzy could ensue.  But now is the time to focus its argument and redirect the energies of the primary cycle.

In addition to that positive point, here are a few don'ts:

Don't go Newtclear: The auditions for the angriest anti-establishment Republican have come and gone, and Newt Gingrich seems to have won that part.  Attempts to outflank Gingrich in nastiness toward Democrats/the media/Barack Obama are more likely to be taken as pandering than anything else.  This doesn't mean that Romney can't hit Obama and his failures hard, but playing the politics of alienation is not a game Romney can or should try to win.  Reagan was bigger than that, and it worked out for him.

Don't be knocked off message: There's going to be a real temptation for Romney to embrace the old version of the Ryan budget in order to distinguish himself from Gingrich, who dismissed it as "right-wing social engineering."  The first Ryan proposal is extremely unpopular (and not exactly realistic in some of its assumptions), and Ryan himself has abandoned it.  Democrats will have a hard time Mediscaring Romney (he is, after all, the man who expanded health-care coverage in Massachusetts), and Romney should not throw this advantage away to score a minor point, one that won't really help him anyways.  For those concerned about Gingrich's stances on policy issues, his dismissal of Ryan's budget is one of the most minor points.  Trying to pander on various faddish right-wing talking points (such as 9-9-9) is not going to win Romney the nomination.  Instead, he needs to focus on building a consistent, conservative campaign theme---even if this theme sometimes runs afoul of the dogma of the moment.

Don't make attacks on Gingrich the centerpiece:  Hitting Gingrich on issues of hypocrisy, his inconsistency on policy, his Washington insiderism, etc. can deliver some benefits.  But Romney should be sure to use these attacks to pivot to a more affirmative case for his own campaign.  A media cycle focusing on how badly Romney hurt Gingrich in a debate will be less helpful for the campaign than one focusing on Romney's proposals and campaign vision.

Florida Shifts

Tonight's debate was an interesting one.  Gingrich has apparently tried to go back to Newt 2.0 mode, by turning down the vitriol and righteous indignation.  It's unclear how convinced voters will be by this change, however, since it comes after Newt 1.0's explosive reappearance in South Carolina.

Romney's attacks seemed to unsettle Gingrich.  At one point, the former Speaker had to pause for a few moments to collect his thoughts to respond.  The famously loquacious politician was at an apparent loss for words.  Romney hit Gingrich hard on his connections to Freddie Mac and his record as Speaker.  Though Gingrich tried, he seemed unable to beat off Romney's criticisms fully.  Meanwhile, Romney kept turning the course of the debate to the failures of the Obama administration and emphasizing Romney's own conservative bona fides (for example, his strong stand on immigration enforcement).

Santorum stressed that his own record was one of consistent conservatism.  He didn't pile on Gingrich, but he didn't refrain from criticizing him either.

It's clear that Gingrich got no winning soundbite moments out of this debate.  His campaign in South Carolina depended upon those.  The lack of fire in this debate may slow Gingrich's momentum.  For the past week, the narrative of his campaign has been one of explosive growth; it's hard to see how tonight will add to that growth rate.  Any slowing in his support could be a signal that momentum has begun to be reversed.  And Romney was able to land some effective blows tonight, muddying Gingrich's claim that he is the true conservative.  Gingrich walked into this debate with great expectations, and he didn't actually deliver.  This was an attempt to sell himself as a candidate who can still win in a restrained debate.  We'll have to see whether the public buys this image.

Gallup Outlier

A poll that's been circulating in the rightosphere today (pushed especially hard by Bill Jacobson over at Legal Insurrection) is this Gallup tracking poll showing Gingrich lagging Obama only by 2 points (48-50).  Some in Gingrichistan are pointing to this poll as evidence of the fact that that Gingrich's new style is paying dividends not only with the Republican base but with the nation as a whole.

There's one problem with this argument, however: this poll is over a month old.  Though this tracking data is featured prominently on Gallup's site (and Gallup doesn't provide a date for it on the main page of its election 2012 polling), it seems to stop by December 15-18, 2011.  So this polling was taken well before Newt 1.0 was unleashed.  (The Gallup chart conflates the GOP nomination polling, which is currently updated, with the general election polling, which is not.)

Many polls taken since then have shown Obama with a much bigger lead over Gingrich---most polls give him around a 10-point (or greater) edge.  Obama's average polling lead over Gingrich has increased over the past few weeks.  Moreover, this poll was probably an outlier even then; other polls taken around the same time show Obama leading by a much larger margin.

So if you're looking for evidence that Newt Gingrich has closed the electability gap, this poll probably isn't it.

"Free" Markets in the 21st Century

The New York Times has a very interesting article about the production of Apple products in the People's Republic of China.  Though Apple used to make products in the United States, it has changed its manufacturing approach over the past decade.

Apple executives say that going overseas, at this point, is their only option. One former executive described how the company relied upon a Chinese factory to revamp iPhone manufacturing just weeks before the device was due on shelves. Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly line overhaul. New screens began arriving at the plant near midnight.
A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.
“The speed and flexibility is breathtaking,” the executive said. “There’s no American plant that can match that.” 

I guess "speedy and flexible" is one way to describe that situation.

And, of course, much of what makes the PRC attractive to companies like Apple is less the free market and more government subsidies:

When an Apple team visited, the Chinese plant’s owners were already constructing a new wing. “This is in case you give us the contract,” the manager said, according to a former Apple executive. The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory. It had a warehouse filled with glass samples available to Apple, free of charge. The owners made engineers available at almost no cost. They had built on-site dormitories so employees would be available 24 hours a day. 

Clearly, another victory for "free trade"!  Yves Smith has more thoughts on this.

Pyrrhic Victory?

There is no doubt that Gingrich's win in South Carolina is a significant victory for him.  The anti-Romney forces pulled out all the stops in the Palmetto State, and, if they couldn't stop the Mitt Train here, they wouldn't be able to stop it anywhere.  Nor should it be forgotten that Gingrich's vote percentage in South Carolina is the second lowest for any winning candidate in a contested South Carolina primary since 1980; even Bob Dole got 45% of the vote in 1996.  Only John McCain did worse with 33% of the vote in 2008.  Still, Gingrich was able to give new life to his campaign, though the way he won may point to electoral red flags in the future.

Cunningly, Gingrich was able to change the narrative in South Carolina by making it about him.  Between "King of Bain"-style attacks on Romney and his explosions of outrage against the media, Gingrich pushed narratives of Romney's momentum to the background.  Eschewing policy, Gingrich ran instead on performance art.  Despite his long history as a Washington insider and many positions on many issues, he made himself the avatar of "conservative" frustration, victimization, and irritation.  In a Republican primary in South Carolina, that's a good tactic. 

If, however, a general election between Gingrich and Obama becomes a referendum on Gingrich, the former Speaker probably loses.  Obama's mixed record is a hard thing to run on; surely, the White House would much rather run against Newt Gingrich as a cultural and political figure.  Gingrich has proven all too glad to make himself the center of a political race, and the Obama administration will likely oblige him.

Almost twenty years ago, another Democratic incumbent realized this dynamic.  Bill Clinton was able to reconfigure the media landscape by letting the 1996 and 1998 elections be about Newt Gingrich.  In both of them, Republicans lost seats in the House (coming within a few seats of losing the House itself in the latter).  Furthermore, by making Gingrich a central figure of the 1996 campaign, Clinton was able to make what might have seemed a troubled reelection bid a sure thing.  There's a reason why few of Gingrich's conservative House colleagues have endorsed him and why many have outright attacked him.

For a while, Gingrich had run on the narrative that this was a "kinder, gentler" Newt, an older and wiser man who had learned from his past personal and rhetorical excesses.  Gingrich's nuclear (and, at times, self-contradictory) barrage against Romney and the media has shattered that narrative.  We're back to Newt 1.0, the battle plans against which were already drafted by the Clinton White House.

If he wants to be viable as a general election presidential candidate, Gingrich is going to need to move beyond red-meat appeals to the conservative id and beyond the politics of personality.  As Conn Carroll at the Washington Examiner has noted, Gingrich's net approval rating with the American public is around -30.  He remains an exceedingly polarizing figure to the public at large.  Gingrich has a few months to turn that around.  But that is a steep hill to climb.  In the days ahead, Republicans will have to ask themselves whether that hill is worth the ascent.

Triumph of Style

Ross Douthat wonders where he can find the ideas in an "idea-oriented" campaign:

I have, for my sins, watched Gingrich make his pitch across what feels like seventeen thousand Republican primary debates, and I am at a loss to identify the “big ideas” and “big solutions” that he is supposedly campaigning on. Yes, he has an implausible supply-side tax plan, but you never hear him talk about it. He has technically signed on to some form of entitlement reform, but you never hear him talk about that, either. Instead, so far as I can tell, his “idea-oriented” campaign consists almost entirely of promising to hold Lincoln-Douglas-style debates with President Obama, grandstanding about media bias and moderator stupidity, defending his history of ideological flexibility much more smoothly than Mitt Romney, and then occasionally throwing out a wonky-sounding notion (like, say, outsourcing E-Verify to American Express) that’s more glib than genuinely significant. His last-minute momentum in South Carolina, which last night’s debate did nothing to derail, has been generated almost exclusively by the politics of ressentiment: If he wins the Palmetto State primary, it will be because conservative voters don’t much like the mainstream press, and Gingrich has mastered the art of taking tough questions and turning them into dudgeon-rich denunciations of the liberal media and all its works.

Meanwhile, the Politico explores the reasons for Gingrich's rise in South Carolina.  This report also comes down to questions of style.

Gingrich's campaign has always been a very style-driven one.  Even the flaws popularly imputed to Gingrich tend to focus more on questions of image than those of substance: he called Paul Ryan's budget "right-wing social engineering" or sat on the couch with Pelosi.  Those public relations specters have haunted his candidacy, in some respects far more than actual policy positions (such as his plan to give local boards the ability to legalize "undocumented" immigrants or his position that the president can ignore Supreme Court rulings at will or his---past---support for cap-and-trade).

Running on style has helped Gingrich in a variety of ways.  Filled with thirty-second soundbites, the debate structure of this cycle has encouraged this emphasis on style.  The limitations of these fora have empowered the one-liner (though some interesting substantive points have been brought up as well).  And Gingrich has mastered the ability to pour a distillation of disdain and wrath into a few sentences.  For many frustrated "conservatives," this concoction is the sweetest of candies.

Much of the grassroots right has expressed a great desire for a bare-knuckles fighter and a primordial cage match between progressivism and "true conservatism," and Gingrich has blithely volunteered to be the anointed gladiator.  Moreover, his aggression toward the media and the left has helped differentiate him from Romney.  Gingrich has had as many "flip-flops" as Romney (if not more), but his casting of himself as the antithesis of "the establishment" has given him a brand that can ignore those petty distinctions of policy.

Early on, style almost broke Gingrich's candidacy.  Then, late in 2011, style elevated him.  A sustained attention to Gingrich's record interrupted this rise, leading to the ascent of Santorum in Iowa.  In order to restore his position, Gingrich has embraced his role as the anti: anti-media, anti-Obama, anti-Romney, anti-establishment, anti-"vulture capitalism," anti-settling, and anti-ending the primary.  By casting himself as the great NOT, Gingrich can play into the frustrations of those looking for the "perfect" candidate.  This stylistic approach has given new life to his campaign.  We'll have to see how much it helps him in South Carolina tomorrow night.

Limits of Standardized Testing

My latest post at the Huffington Post explores a conservative critique of test-driven education "reform":

A persistent -- and, I think, powerful -- theme in conservatism is the emphasis upon limits and doubt about the wisdom of centralized actors.  One of the strongest pragmatic defenses of the free market is that centralized authority is not efficient enough and wise enough to direct the economic energies of the nation; hence, a diversity of economic actors should make their own, personal economic decisions.  Moreover, a mainstream of conservative philosophy from Burke onwards suggests that the richness of a given human society and culture goes beyond mere statistics -- something about the weave of human life resists quantification.

However, a great many "conservatives" ignore these teachings when the topic of education "reform" comes up.  Suddenly, a technocratic mania that seems far more a trait of bureaucratic "progressivism" rules. 

Read more at the Huffington Post.

Splitting the Vote

Much anti-Romney analysis claims that the multiple candidates running against Romney are splitting the Republican vote and allowing the "Massachusetts Moderate" (not sure if this phrase has been trademarked by Gingrich yet or not) to beat a divided field.  Polling before might have backed up this claim (when various not-Romneys beat Romney in a one-on-one polling match-up), but it now tells a different story.

For example, recent YouGov polling showed Romney beating Santorum 58%-42% and beating Gingrich 66%-34% nationally.  A CNN poll of Republicans nationwide released on Friday showed Romney beating Santorum 60%-37% and beating Gingrich 59%-37%.  This trend also carries over into many statewide races.  In South Carolina, a PPP poll shows Romney with a five-point lead against the whole field.  Match-ups where Romney is pitted against a single other Republican see his margin of victory grow considerably.  He leads Gingrich 48%-37%, Paul 63%-28%, Perry 56%-31%, and Santorum 48%-39%.

Many supporters of one not-Romney feel more comfortable with Romney rather than another not-Romney.  So, at this point, it seems as though a full field could be hurting Romney more than helping him. A multiplicity of opponents can attack Romney (sometimes in contradictory ways) and hope to pull his polling numbers down enough to allow one of the not-Romneys to win.  At this time, however, polling seems to suggest that Republicans would rally around Romney more than they would around any of his GOP rivals.

Huntsman and Audience

Now that Jon Huntsman has declared that he's withdrawing from the race to be the GOP presidential nominee (and has endorsed Mitt Romney), the postmortems have begun.  Many of them focus on Huntsman's seeming difficulty in finding an audience.

David Frum says that there was a disconnect between Huntsman's personality and his program:

Huntsman offered a critique of what has gone wrong in the modern Republican party: too anti-science, too socially conservative, too militarily interventionist, too hostile to expertise.

He did not however offer a unique selling proposition for his own candidacy. Even supposing a Republican primary voter agreed with every point in Huntsman's critique (and surprisingly many do agree)—what then? Huntsman's answer to the party's problems was himself: smart, sophisticated, worldly, pragmatic. But every one of those characteristics is shared with Romney. What Huntsman did not offer was a programmatic alternative. On the contrary, the Huntsman program doubled down on Norquistism: big tax cuts, Ryan plan, etc.

This program created a contrast with Romney, but in the wrong direction: the least ideological Republican candidate now offered the most ideological economic platform. 

Ace instead focuses on how Huntsman seemed to treat the base:

It's difficult to like someone who clearly doesn't like you. While in the past several weeks conservatives, seeking some alternative to Romney, have started to at least entertain the possibility of backing Huntsman, it was all but impossible given Huntsman's frequent obnoxious signaling that he just doesn't like us.

It's not just an emotional thing, either. If a candidate specifically lays down the marker that he doesn't think much of our opinion but cares a great deal about what the editors of Vogue might think, that's a pretty strong sign that he'd govern in such a way to pander to their opinions and against ours.

Federal Judge Denies Perry, Gingrich et al Request for Injunction in Virginia

Rick Perry, joined by Newt Gingrich, Jon Huntsman, and Rick Santorum, filed a lawsuit challenging the ballot requirements of the Republican Party of Virginia.  Currently, only Mitt Romney and Ron Paul have fulfilled Virginia's requirements and will be on the March 6 primary ballot.

U.S. District Judge John Gibney (an Obama appointee) has ruled against these campaigns.  The principal reason for Gibney's ruling seems to be the doctrine of laches (when a plaintiff takes an unreasonable amount of time to claim a legal defense of his or her rights).

Gibney seems to suggest that, in his opinion, Virginia's requirement that only those who are eligible to register to vote can circulate petitions for a candidate is an abridgement of the First Amendment.  However, requiring 10,000 signatures with at least 400 signatures from each Congressional district is not an unconstitutional burden.  If the campaigns had filed a lawsuit against this purported abridgement of First Amendment rights earlier (such as in August or September or October), Gibney probably would have ruled this requirement unconstitutional.

However, the candidates did not do that.  As Gibney writes:

They plaintiffs could have challenged the Virginia law at that time. Instead, they waited until after the time to gather petitions had ended and they had lost the political battle to be on the ballot; then, on the eve of the printing of absentee ballots, they decided to challenge Virginia's laws. In essence, they played the game, lost, and then complained that the rules were unfair.

Because they waited so long, Gibney has denied their request for an injunction.

Some other interesting details come out in this.  One is that the Virginia State Board of Elections does not seem to know the exact number of signatures that either Gingrich or Perry got.  However, Perry's camp only admits that it submitted more than 6,000 signatures, and the Board agrees that it was less than 10,000.  Gingrich's camp says it submitted 11,050 signatures, but the Board determined that fewer than 10,000 were valid.  These details seem to suggest no evidence for a RINO establishment conspiracy to keep Perry and Gingrich off the ballot.

Gibney's ruling also notes that Jerry Kilgore, a former Attorney General of Virginia and the Virginia campaign chair for Perry, got over 13,000 valid signatures on a "shoestring budget" in his race for AG in 1997.

We'll have to see whether/how these campaigns appeal this ruling.

Oh, the Irony

A list of the some of the ironies regarding the "King of Bain" dust-up:

• The old anti-Romney claim was that Romney was too sympathetic to the middle class (for example, in offering certain tax-cuts only for those who make less than 200K/year); now, he's become the embodiment of corporate, top-1% greed.
• Perry and Gingrich can make these attacks second-guessing Romney's experience in business in part because they have been career politicians.
• Gingrich served on the board of a company that pioneered the leveraged buyout mechanism about which he has criticized Bain.
• Perry collects plenty of donations from those who practice the very same "vulture capitalism" of which he accuses Romney.
• Conservatism is supposed to be about individual responsibility, but now Romney is being blamed for the actions of Bain years after he retired from the organization; many of the events talked about in the "King of Bain" "documentary" happened after 1999, when Romney left the organization.
• I thought a standard line for "True Conservative" purists was that too many regulations are strangling the national economy, but the purported excesses of Bain (from the perspective of the Gingrich and Perry camps, at least) occurred due to certain regulatory rules---which could be revised or added to.  So we've moved from regulatory abolition to the idea of regulatory reform or increase (and President Obama would no doubt be glad to talk about the latter).
• Many "True Conservative" purists were salivating at the prospect of Gingrich offering a full-throated defense of capitalistic profit in all its forms in the presidential debates against Barack Obama.  So much for that exchange.
• Some "libertarians" warned that Rick Santorum was some kind of anti-market technocrat (or something), but Santorum has actually defended the actions of private equity firms (and thereby Bain) as a worthwhile part of capitalism.
• At a time when they could be working to develop and defend market-oriented policies that support the economic middle, many conservatives have chosen instead to indulge in identity politics.

Architech of AZ Immigration Law Backs Romney

The Washington Times reports:

“Romney stands head and shoulders above the crowd,” Kris W. Kobach, Kansas’ secretary of state and the architect of the Arizona law, told The Washington Times, praising Mr. Romney for treading where other Republican candidates have refused to go. “Immigration is one of those issues that will appear to be a hot button — some elected officials who are afraid of offending anyone will avoid taking tough stands on immigration, and he took a tough stand.”

Other opponents of legalization for "undocumented" immigrants are also coming out for Romney.

Beating Expectations

If someone had predicted a little over a month ago that Romney would have won in both Iowa and New Hampshire, more than a few people would have dismissed that notion as a little delusional.  Yet here we are.  With nearly around 40% of the vote (and a 15+-point margin), Romney cruises to victory in New Hampshire, becoming the first non-incumbent Republican to win both the Iowa and the New Hampshire primaries.  I thought Romney would need at least a 10-point win to maintain his momentum, and it looks like he got it.

Exit poll data shows what a crushing victory this was for Romney.  Among registered Republican voters, he got 48% of the vote, outpacing by over thirty points his nearest rival (Ron Paul at 15%).  Romney's win did not come purely from a coalition of independents and moderate Republicans (though he did win registered independents as well, beating Paul 32-30).  Self-described conservative and very conservative voters overwhelmingly preferred him to other candidates.  Moreover, he won by eighteen points those New Hampshire voters who support the "Tea Party": Granite State "Tea Partiers" have claimed that Romney is their man.  Ironically, Gingrich and Perry's hectoring attacks upon Romney's record in the private sector may help unify conservative support behind Romney.

Ron Paul's second-place finish was fueled by young people, new voters, and independents.  Among registered Republicans, he didn't get above 15%, but independents and Democrats helped lift him to second place.

Jon Huntsman bet it all on New Hampshire and came in at around 17%---and could only get to 10% of registered Republican voters.  Huntsman has said he's staying in, but he's hovering around 2% or 3% in South Carolina, Florida, and nationally.    New Hampshire was the sort of territory most favorable to Huntsman, so those states will be a long march for him.  We'll have to see over the next few days whether his numbers increase or not---if there's a bump, perhaps we could be seeing the beginning of Huntsmentum.

No doubt Team Santorum finds tonight's results a little unpleasant.  But a near-tie with Gingrich for fourth place definitely keeps his campaign viable.  Unlike either Gingrich or Perry, Santorum has performed very strongly in one of the first two key primary battles and respectably in the other.  He goes into South Carolina with some vigor in his step.  Unlike New Hampshire, South Carolina will be a key testing ground for his candidacy.

What to Look For Tonight

Looking at some key numbers for tonight:

In the lead-up to the New Hampshire primary, here are a few key things to look for:
Romney's margin of victory: It's widely assumed that Romney is going to win New Hampshire tonight.  If Romney had come in a distant third in Iowa, he would probably need a New Hampshire win to stay viable as a candidate.  Right now, he only needs a New Hampshire win to maintain his momentum....

 Read more at the Huffington Post.

Clarifying the Curve

In a comment at FrumForum, Chris Conover at AEI replies to my analysis of the rate of growth of per capita health-care spending in Massachusetts.  Since Conover raises some worthwhile points and because FrumForum is (alas) about to go dark, it's worth quoting the comment in full:

As a practical matter, it is quite difficult to distinguish the effects of the recession from the effects of “Romneycare” in the 2007-2009 period. So in general, Fred Bauer gives more credit to Romneycare than I myself would.
That said, in assessing gubernatorial performance, it seems a little odd to ignore the fact that health spending was going up MUCH faster than the national average while Governor Romney was in office but then give him great credit for the purported slowdown in spending after he left office. If the argument is that governors really can’t do that much about health spending anyway, then it renders all these cross-state comparisons moot. One can’t (or shouldn’t) cherry-pick the data to highlight a comparison that looks favorable and ignore ones that are not.
The best analogy I can give is this. Imagine someone who is very obese getting a diet pill. Prior to taking the pill, this individual’s weight relative to the national average was rising 27% every 2 years. After the pill, their weight is still rising relative to the national average, but “only” 5% faster. The individual taking the diet pill is still gaining weight faster than those who don’t. Would you take that pill?
Until Mr. Bauer can explain what it is about Massachusetts health care that should lead us to “expect” 27% faster-than-average growth in its spending, pointing to only 5% faster-than-average growth seems problematic. Especially since the one thing we know for certain happened between 2004-2006 and 2007-2009: Governor Romney left office! If we give Governor Romney “credit” for the ballooning of MA health spending during his administration, then his apparent ability to lower this excess to “only” 5% seems far less impressive.

There's a lot here, so I'll address it in parts.

First of all, I should clarify that the aim of my last piece was not---FrumForum headline notwithstanding (and I was not responsible for writing the headline for the FF post)---that Romneycare alone bent the spending curve down forever.  I think more analysis and evidence would be needed to substantiate that argument.

Instead, my analysis grew out of a desire to test the now-standard claim that Romneycare exploded health-care spending in Massachusetts.  This federal data suggests that, at least until 2009, this claim might be more than a little problematic.  Now, more evidence might come out that supports the argument of exploding Massachusetts health-care spending due to Romneycare, but current federal data does not support this claim.

In his last few posts to the AEI blog, Chris Conover has been making a very different claim: that health-care spending grew rather quickly during Romney's term as governor.  The CMS data certainly seems to support that claim.  For example, in 2006, health-care spending grew 44% faster in Massachusetts than it did in the nation as a whole.  However, Romney is not exactly an anomaly here.  In 1998, during Paul Cellucci's term, health-care spending also grew 44% faster in Massachusetts than it did in the nation as a whole.  Since 1991, there have been only three years---1995, 1996, and 1999---where health-care spending in Massachusetts grew slower than it did in the nation as a whole. It's also worth noting that my piece was not particularly talking about Romney's overall record of health-care spending but about the effects of Romneycare (or at least what the effects of it aren't).  So I'm not sure how much I was "cherry-picking" data here as much as trying to compare the immediate period before Romneycare to the period after Romneycare.

Also, the extreme increase in spending during Romney's tenure arguably makes the case for Romneycare stronger, not weaker: an executive looking at exploding spending might feel the need for a game-changing reform.  Moreover, most anti-Romney "conservatives" are not claiming that health-care spending in Massachusetts during Romney's tenure was much of a problem; for them, Romneycare's meddling with the status quo was worse than leaving things as they were.

As I said in my earlier post, I think health-care spending is due to a variety of factors, some of which are out of the hands of governors and government more broadly.  So I think there are limits to how much any single political official can change the health-care curve, especially in the US health-care system, which relies on a combination of government and private spending.  I also think that cost controls are not the be-all and end-all of measuring the worth of a health-care system.

However, if I were to defend the claim that Romneycare reduced the rate of health-care spending growth, I might make the following points.  Mr. Conover is right to note that the recession does play a role in the reduction of the rate of health-care spending growth in the US and Massachusetts.  However, much more analysis would need to be done to explain why the recession caused the rate of growth in per capita health-care spending to decline in Massachusetts faster than it did in many other states, including ones with higher unemployment rates.

The recession might explain the absolute fall in the rate of per capita health-care spending growth in Massachusetts, but it does not entirely explain the relative fall as well.  In the recession during the early 2000s, Massachusetts was hit fairly hard (its unemployment rate more than doubled between late 2000 and the middle of 2003), but its health-care spending grew at a much more rapid rate than that of the nation as a whole: 14.7% faster in 2001, 20.5% faster in 2002, and 9.7% faster in 2003.  So, in the past, an economic slow-down did not lead to a radical narrowing of the gap between US and Massachusetts health-care spending growth rates.

And to return to Mr. Conover's analogy of the pill:

Prior to taking the pill, this individual’s weight relative to the national average was rising 27% every 2 years. After the pill, their weight is still rising relative to the national average, but “only” 5% faster. The individual taking the diet pill is still gaining weight faster than those who don’t. Would you take that pill?

 I think I, and most other people, would take that pill (with a couple caveats on the side).*  After all, that is still a big reduction in the rate of growth.  But I wouldn't stop looking for further treatment, either.  Refusing to take that pill (when that pill can be taken as part of a broader health-care regime) would be somewhat like letting the perfect be the enemy of the good.

And more data here will be crucial in adjudicating this point.  In 2007, per capita health-care spending in Massachusetts grew 46% faster than it did for the nation as a whole, but, in 2008 (once Romneycare went more fully into effect), it grew 6.7% faster; by 2009, it was only growing 3.8% faster.  That could either be a statistical blip or it could be the start of a downward trend in the growth of health-care spending in Massachusetts; there have been times when the rate of growth in Massachusetts spending has slowed compared to the nation as a whole only to explode a few years later, so a couple years is not enough time to demonstrate sufficiently the effects of a health-care policy on spending.

But I think there is a big difference (in terms of policy and in terms of politics) between debating how much Romneycare slowed spending up through 2009 versus debating how much it skyrocketed spending up through 2009.  Contemporary political discussion has focused on the latter; federal data suggests that this assumption might be a problematic one.

*Those caveats include a consideration of whether the pill would have other harmful side effects and whether it would work over the long term.  The jury is probably still out on Romneycare on both those points.  I do not think---and doubt even Romney himself believes---that Romneycare is the magic pill for curing all the nation's health-care concerns.

Minor Programming Update

On Friday, David Frum announced that FrumForum would be closing down.  As readers may know, I had been contributing to FF over the past few years.  I wish David Frum and Noah Kristula-Green all the best in their move to the Daily Beast/Newsweek.


In the wake of these changes, I'll still be posting here, but I will also be contributing to the Huffington Post.

The Long Fight

Moe Lane makes some fair points about the benefits of a longer primary race.  I've written before about the advantages of such a stretched out primary process.  Deliberation is a good thing, and Republicans have every right to engage in a months-long search for their nominee.

Bending the Curve?

Via an interesting post by Chris Conover, I came across this recently released National Health Expenditure report, which has data on health-care spending up through 2009.  This data includes a state-by-state breakdown of personal health-care spending (a number that includes direct expenditures on health-care but does not include administrative costs).

Digging into these numbers allows one to calculate (roughly) the growth of health-care spending in each state from 1991 to 2007.  This data set tells an interesting story for Massachusetts after the passage of health-care reform there: after the passage of Romney's reforms, the rate of per capita health-care spending growth slowed in Massachusetts both in absolute terms and relative to the national average.

Here's a chart I put together looking at the cumulative growth over two periods: from 2004 to 2006 (prior to Romneycare) and from 2007 to 2009 (after the measure was applied).  I've included the US national average as a whole as well as the New England average in order to situate Massachusetts in its local context.  New Hampshire offers the example of a New England state which did not engage in Romney-style reforms, and Ohio offers a counterexample of a Midwestern state with relatively slower-growing health-care costs.  Texas, often touted as an alternative model for the nation, also helpfully sets up a contrast with Massachusetts.  This chart looks at the cumulative percentage change in per capita personal health-care spending over the 2004-2006 and 2007-2009 periods.

	Spending Growth 2004-2006	Spending Growth 2007-2009
US National Avg	11.40%	7.86%
New England	9.23%	9.15%
MA	14.51%	8.28%
NH	16.69%	10.10%
NY	10.55%	8.02%
OH	9.56%	7.89%
TX	12.14%	9.05%

Perhaps in part due to the recession, the rate of growth for health-care spending dropped for the nation as a whole (though spending did still grow).  However, it's worth noting that, in the years after Romney's reforms went into effect, the rate of growth for health-care spending in Massachusetts dropped even faster than the national average did.  Between 2004 and 2006, health-care spending in Massachusetts grew almost 27% faster than it did for the nation as a whole; between 2007 and 2009, it grew only 5% faster.  After Romney's reforms, Massachusetts went from having a health-care spending growth rate well above the national average to one just a little bit above.  For example, between 2008 and 2009, personal health-care spending increased at a rate of 3.8% in the US, while Massachusetts saw its spending increase by 3.9%.  Compare that to the changes between 2005 and 2006: US spending grew at 5.3%, but Massachusetts spending grew at 7.6%.  Situating Massachusetts in the context of the rest of New England makes the change in spending rates even starker: prior to Romney's reforms, Massachusetts personal health-care spending grew faster than the New England average most years.  After his reforms, it grew slower than the New England average (often having one of the lowest rates of health-care spending growth in the region).  These numbers suggest that Texas is doing a worse job at taming the rate of health-care spending growth than Massachusetts (though, for the moment, per capita health-care spending in Texas is lower than that of Massachusetts).

Massachusetts seems to have especially slowed down the rate of growth in hospital spending.  Between 2004 and 2006, Massachusetts hospital spending jumped 16.5%; between 2007 and 2009, it only climbed 5.5% (a 67% reduction in the rate of growth).  US spending on hospital care grew 12.7% between 2004 and 2006; between 2007 and 2009, it grew 8.6% (a 33% reduction in the rate of growth).  Spending in Massachusetts hospitals rose much more slowly than the national average.  One of the key premises of Romneycare was that bringing all of the commonwealth into the health-care system would lower the need of hospital use (especially the use of emergency room care) and thereby lower spending at the hospital level.  These numbers seem to suggest that something like that may be happening.

In many areas of health-care spending, the rate of growth for spending in Massachusetts either fell more than it did for the nation as a whole or fell at roughly the same rate.  This data would seem to muddy the waters for the claim that Romney's reforms caused health-care spending in Massachusetts to skyrocket.  Since Romneycare, health-care spending in Massachusetts (at least until 2009) grew more slowly than it did in many other states and also grew much more slowly compared to the rate of spending growth in Massachusetts before Romneycare took effect.

Health-care spending depends upon a variety of factors (including population aging and economic growth), so this data set does not tell the whole story regarding the effect of the 2006 reforms on health-care spending.  It does, however, pose a challenge to the argument that Romney's reforms uniquely inflated health-care spending in Massachusetts.  In terms of raw health-care spending, Massachusetts seems to have bent slightly down the curve of growth---compared to many other states and, in many respects, the nation as a whole.

(Of course, the rate of growth in health-care spending is not the sole deciding issue for Romneycare: other questions about long-term sustainability, the role of government coercion and spending, and other topics are also very important.  Nor is there a direct correlation between health-care spending and private insurance premiums, which seem to have increased in recent years.  Moreover, data for years after 2009 might tell a more complicated story.)

(Crossposted at FrumForum)

UPDATE: See this post for more on health-care spending in Massachusetts.

All Tied Up

In the wake of the Iowa caucuses, what matters now is not the exact order of Romney, Santorum, and Paul; the numbers are very close. What does matter is the range between the candidates. Iowa gives us basically a tie between Romney and Santorum, with both at around 25%. Ron Paul comes out a strong third at around 21%. Gingrich, Perry, Bachmann, and Huntsman, who did not even campaign in Iowa, fall far behind.

Romney did not sew up the nomination tonight, but he took a significant step down the road to the nomination. A few months ago, Romney was polling in the high teens and low twenties in Iowa. Since July, he has had relatively few days where he was in the lead. So a tie today is a not-insignificant accomplishment. It is, however, a limited one: he still remains under 26%. A big win in New Hampshire would be helpful for Romney in breaking the Romney-ceiling narrative. And Romney's people shouldn't be too depressed about the fact that Romney performed at about the same level in 2008 in Iowa: Reagan lost the Iowa caucuses to Ford in 1976 and lost them again to George HW Bush in 1980---he couldn't get above 30% in 1980. Somehow, Reagan still won the nomination, and the presidency, in 1980.

This is a hard night for Rick Perry. He spent more than any other candidate in Iowa and is stuck in fifth place. With Perry's declaration that he is going back to Texas to re-access his path to the nomination, his campaign is in critical condition. Newt Gingrich can't be too happy, either. A few weeks after boasting that he would be the nominee, he is stuck with a disappointing fourth-place showing. Moreover, the path to the nomination for Michele Bachmann now seems almost totally closed down.

Independents were responsible for Ron Paul's performance tonight. Among Republicans, the entrance poll reports the following: 28% Santorum, 27% Romney, and 14% Paul. Among independents, however, the numbers were 44% Paul, 18% Romney, and 13% Santorum. The "independent" number shows a big increase from the 2008 Republican caucuses; with the Democratic caucuses uncontested this year, many Democratic-leaners may have come out for Paul. Due to a number of reasons, it seems quite clear that many Democrats would love to run against Paul.

And, of course, this was a very good night for Rick Santorum. The outstanding question is whether Iowa is a one-off or a route to the nomination. For George W. Bush, it was the latter. For Mike Huckabee, it was the former. Look to see whether Rick Santorum's numbers rise in national polling over the next few days. If they do, those looking for a not-Romney might rally around him.

Santorum has wisely decided to contest the New Hampshire primary. Expanding his brand there will be crucial for maintaining his momentum. There's a reason why many Perry supporters and Gingrich supporters are deriding Santorum's chances of getting the nomination: he's a serious threat to them. If momentum starts to accrue to Santorum, we might see Gingrich and, possibly, Perry focus their fire on him rather than on Romney. We might also see Gingrich choose instead to focus on tearing down Romney in order to keep him from getting the nomination---whether that leads to a Gingrich victory or not. Santorum's victory speech tonight presents a less angry Santorum, one focusing on economic growth and social optimism. Like Romney, he has won in Democratic-leaning areas before.

A few points about the future:

The January 10 New Hampshire Primary: Look at Santorum's and Huntsman's performances. A decent showing in New Hampshire can keep Santorum nationally viable. Huntsman needs a strong showing to keep his campaign vital.

The January 21 South Carolina Primary: This could be a bloody, bloody battlefield. It's hard to see how both Gingrich and Perry make it out of this primary, if they both make it to that point. Perry is especially vulnerable here; Gingrich could have strong, though not winning, numbers and still limp on to Florida. A Romney win here would almost guarantee him the nomination, though he in no way needs to win in order to maintain his leading status. Santorum's numbers will also bear watching.

Premises, Premises

I think this Daily Caller headline ("Romney Supports, Opposes Free Trade with China") and story assume a bit much:

One day before the all-important Iowa caucuses, former Massachusetts Gov. Mitt Romney continues refusing to clarify his position on free trade with China.

In his 2010 book “No Apology: The case for American Greatness,” Romney argued against protectionism, an ideology that favors tariffs, quotas and other restrictions placed on international trade.

“Personally, I don’t like to see America lose any good jobs,” Romney wrote. “But when I see an American company challenged by a foreign competitor, I don’t look for protectionist policies as an answer to the company’s problems. Instead, I look to see how that company can become competitive once more, drive off its foreign foe, and propel its own products into foreign markets.”

But during the 2012 presidential campaign, Romney has taken the opposite position.

During an Oct. 24 radio interview with the Fox News Channel’s Sean Hannity, for instance, Romney promised that on “day one” of his presidency he would impose new tariffs on trade with China, and classify the nation as a “currency manipulator.”

“At some point, you’ve got to stand up for your rights and say ‘these people are cheating,” Romney told Hannity. “They’re killing certain industries. This just can’t go on forever. It’s simply unacceptable.”

There's only a contradiction here if you believe that the current trade relationship with the People's Republic of China is one of market-based free trade---a contested assumption to say the least. On a related note, David Frum suggests that there may be more depth than mere pandering to Romney's position on the People's Republic of China.