1. Richard Mayhew: $2.32 per person per month: “That is the great ‘risk corridor’ and ‘death spiral’ potential of one major Exchange carrier.  Highmark is an insurer for Pennsylvania, Delaware and West Virginia.  They did well on the Exchanges this year by picking up over 100,000 new members in Pennsylvania.  However their actuaries were off by a little bit…. ‘The state’s largest health insurer expects to lose $2.9 million on its exchange business in Pennsylvania from July 1, 2014, to June 30, 2015, according to a filing with the state Department of Insurance.’ The actuaries, flying blind, were able to get within a large cup of coffee.  The article states that the major source of error was an underestimation of how much ‘catch-up’ care that previously uninsured individuals were consuming in the first three months of the open enrollment and active policy period.  I think that this error will narrow as the last minute surge of healthier and younger people who either signed up last week or are in the process of signing up now through the blue box enrollment period enter the acturial calculations.  But even if the revised projection is perfect, and the age/health composition of the Highmark risk pool does not get younger/healthier, their base rates have to increase by the cost of a good cup of coffee. So how do we get death spiral stories out of that? We don’t.”

  2. Ezra Klein: How politics makes us stupid: “At one point in our interview Kahan does stare over the abyss…. He recalls a dissent written by Supreme Court Justice Antonin Scalia in a case about overcrowding in California prisons. Scalia dismissed the evidentiary findings of a lower court as motivated by policy preferences. ‘I find it really demoralizing…’ Kahan says. But Scalia’s comments were perfectly predictable given everything Kahan had found…”


  1. Jonathan Chait: Why Race Has Been the Real Story of Obama’s Presidency All Along: “f you set out to write a classic history of the Obama era, once you had described the historically significant fact of Obama’s election, race would almost disappear from the narrative. The thumbnail sketch of every president’s tenure from Harry Truman through Bill Clinton prominently includes racial conflagrations—­desegregation fights over the military and schools, protests over civil-rights legislation, high-profile White House involvement in the expansion or rollback of busing and affirmative action. The policy landscape of the Obama era looks more like it did during the Progressive Era and the New Deal, when Americans fought bitterly over regulation and the scope of government. The racial-policy agenda of the Obama administration has been nearly nonexistent. But if you instead set out to write a social history of the Obama years, one that captured the day-to-day experience of political life, you would find that race has saturated everything as perhaps never before…”

  2. Nick Rowe: Temporary vs permanent money multipliers: “‘The current amount of deposits is not so much based on the curren[t] supply of [monetary] base but the supply expected in the future’…. Now that is what I call a real and important critique of the money multiplier, as exposited in the textbooks…. It is a critique that has important real world implications, like for the US right now. And it is us Market Monetarists who should be making that critique. Compare two different cases: 1. The Bank of Canada announces it will permanently double the monetary base…. 2. The Bank of Canada announces that a computer glitch will cause the monetary base to double, but only for one month…. In the first case I would expect an (approximate) doubling of currency in public hands and doubling of deposits. The money supply would double, as would the price level and all nominal variables like NGDP. Nominal interest rates would rise temporarily, then revert to normal. In the second case I would expect approximately nothing to happen. The banks would roll their eyes and sit on (approximately) all the extra base as reserves for one month…. I think that the current US case is much closer to case 2 than to case 1…. The current state of the balance sheet matters less than the expected future balance sheet, and the expectations about the conditions under which the central bank will change that balance sheet.”

Should Be Aware of:

  1. James Kwak: More Pseudo-Contrarianism: “I accidentally glanced at the link to David Brooks’s recent column and—oh my god, is it stupid. You may want to stop reading right here to avoid being exposed to it. Basically, Brooks says that the Supreme Court’s decision in McCutcheon is pro-democratic because it strengthens political parties relative to ‘donors and super PACs’…. McCutcheon eliminates the aggregate limits on direct contributions to candidates, parties, and PACs (not super PACs–no such limits exist) but the individual contribution limits still stand—so now you can max out to more candidates and parties than you could before…. In the 2012 cycle, 644 people hit the aggregate limits, and they donated $93 million (to entities governed by aggregate limits). That’s nothing. Sheldon Adelson alone contributed close to $150 million…. So basically we’re talking about those very few people who, when asked to contribute to (say) the DCCC, said, ‘Sorry, I’m maxed out’. At the margin, now some of those people can write the check to the DCCC rather than to some super PAC—although they can also write the check to some candidate, or that candidate’s PAC, and that money isn’t under party control.”

  2. Sharon K. Long et al.: QuickTake: Number of Uninsured Adults Falls by 5.4 Million Since 2013: “The Urban Institute’s Health Reform Monitoring Survey (HRMS) has been tracking insurance coverage since the first quarter of 2013. Today, we report the first estimate of how the uninsurance rate has changed through early March 2014… uninsurance rate for nonelderly adults (age 18–64) was 15.2 percent for the nation, a drop of 2.7 percentage points since September 2013, the month before ACA open enrollment began. This represents a gain in coverage for about 5.4 million adults. States that implemented the ACA’s Medicaid expansion saw a larger decline: their uninsurance rates for adults dropped 4.0 percentage points since September, compared with a drop of 1.5 percentage points for the nonexpanding states. The average uninsurance rate for adults in the 24 nonexpanding states was 18.1 percent in March 2014, well above the 12.4 percent average in the expansion states.”