Baum on Money: 'A Great Problem to Have'
It's Day 2 of the government shutdown, and the nonsense shows no sign of abating. Here are some articles I've selected for your breakfast reading that are guaranteed to enhance your digestion.
Shutdown is just a warm-up exercise
We all read the stories with annotated graphs showing how stocks were undeterred by the last government shutdown in 1995 and 1996. So the word went out that it was OK to buy stocks, which rallied yesterday. But the partial shutdown (essential government services are being maintained) is just a drill for the big stand-off later this month: negotiations over raising the debt ceiling. If the silliness exhibited in Washington this week is any guide, investors may not be so blasé about round 2. There's even talk that efforts to fund the government and raise the debt ceiling could become intertwined. Talk about a grand bargain -- or a grand finale.
Something isn't much better than nothing
Yesterday the Republicans decided a bunch of piecemeal spending bills would be better than nothing. They should have stuck with nothing. House minority leader Nancy Pelosi called the gambit "pathetic." Senate Majority Leader Harry Reid said the GOP should "stop the games." Obama threatened a veto. The two parties pointed fingers at one another. And the public just looked on in amazement.
In case you were wondering what sort of economic data will be reported as long as the federal government is shutdown, the Wall Street Journal provides a calendar. Data compiled and released by the states and private entities, including trade groups, will be released on schedule. Ditto information that comes from the Federal Reserve and its various district banks, which are self-financing. (Yes, that super-sized portfolio pays interest.) The government's statistical agencies -- the Labor and Commerce Departments -- are shut down and will not release any data, including Friday's employment report for September. What will the Fed do without the report as guide?
Open for business, hampered by glitches
The state health-insurance exchanges opened for business on schedule yesterday but couldn't handle the traffic, the New York Times reports. Websites went down, flashed error messages and prevented users from creating accounts. Health and Human Services Secretary Kathleen Sibelius called it "a great problem to have." She was referring to the overwhelming volume, but one has to wonder if 3 1/2 years wasn't enough time to prepare for the big day. And where were the Republicans during the train wreck they predicted? "Chasing a different train," according to Politico: "staging photo ops with GOP negotiators pretending to wait for Democrats to come to the table" -- and figuring their way out of the budget mess.
The real problem with Obamacare is that it's not Romneycare
The Tax Policy Center's Len Burman wonders what would have happened if Obamacare were Romneycare. In other words, what would today's partisan debate look like if Mitt Romney had been elected president in 2012? "The White House and Republicans would be trumpeting the remarkable success of the free (but regulated) market in providing a wide range of choices in insurance plans and in most markets pushing prices down," Burman writes. At the same time, Democrats would be chafing at the individual mandate and the burden it puts on middle-income workers. They would complain about the hardship high-deductible plans imposed on middle-class families if they get sick. Just something to think about.
(Caroline Baum is a Bloomberg View columnist. Follow her on Twitter.)
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