Brookings: Topics - U.S. Congress

Implementing the Affordable Care Act: Organizational and Political Challenges

Mon, 20 May 2013 14:00:00 -0400

Event Information

May 20, 2013
2:00 PM - 3:30 PM EDT

Falk Auditorium
Brookings Institution
1775 Massachusetts Avenue NW
Washington, DC 20036

The Affordable Care Act is the single biggest domestic policy accomplishment of the Obama administration, but most Americans have yet to feel its impact, since many of the most far-reaching provisions do not take effect until 2014. Although the Supreme Court upheld the law, it continues to face political opposition and attempts to slow down its full implementation.

On May 20, the Management and Leadership Initiative at Brookings hosted a forum on the organizational challenges of implementing the Affordable Care Act in a difficult political environment. A panel of experts discussed obstacles such as building the state exchanges, expanding Medicaid, the role of the IRS, enforcing the individual mandate, the reaction from the small business community and the effect on premium prices.

Video

Audio

Implementing the Affordable Care Act: Organizational and Political Challenges

The Affordable Care Act: From Hiccups to Repeal

Elaine Kamarck — Wed, 15 May 2013 17:34:00 -0400

Note: On Monday, May 20, Elaine Kamarck, director of the Management and Leadership Initiative at Brookings, will moderate a public forum on "Implementing the Affordable Care Act: Organizational and Political Challenges."

It's been a long time since the federal government had to implement a large, new, federal program. Ten years ago we saw the implementation of Medicare Part D and the creation of a new cabinet department, the Department of Homeland Security. In each instance there were predictions of disaster and substantial growing pains. In the case of Medicare Part D implementation exceeded expectations and costs have not been nearly as high as feared. In the case of DHS, implementation was bumpier, nonetheless, ten years later both operate more or less smoothly and, in retrospect, the crisis now seems overblown.

This year, the Obama administration needs to finalize implementation of the Affordable Care Act—a historic piece of legislation and the most significant domestic policy achievement of the Obama administration to date. And the question of how it goes is front and center. Even the president has admitted that there will be “hiccups” along the way. Compared to earlier pieces of health care legislation, the ACA is incredibly complex, involving activity by fifty states, the jurisdiction of fifty state insurance regulators and changes in the entire health care industry. Added to the inherent complexity of the bill is the fact that it had no Republican support and is still adamantly opposed by the Republican party and by half of all those polled.

So the question is: how bad will it be? Imagine a continuum that goes from “hiccup” on one end to repeal on the other end. With plenty of points in the middle. What would that look like?

The hiccup scenario is the most optimistic. Hiccups are more or less normal. If the implementation is successful, the exchanges will be up and running. There will be glitches. Some people who qualify won’t get their subsidies; some who don’t will. The number of companies on the exchanges won’t be as big as hoped for but will grow. Premiums for health care will rise only modestly and the enhanced services in the new health care plans will make most people okay with the price increase.

The delay scenario is not really good nor is it fatal. A less successful outcome is one where the feds and states find they have to pull back from key provisions in the bill at least for a while. There may be delays in opening exchanges which would necessitate delays in enforcing the mandate that everyone buy insurance. The federal hub may not be able to interface with statewide data and eligibility could become a lengthy bureaucratic process. HHS might adopt a generous waiver policy while states work out their systems. Premiums may rise, leading to complaints from the public but no substantial drops in insurance buying.

The repeal scenario is fatal. Obviously Republicans, especially in the House, are rooting for this one. In fact they seem to like taking the repeal vote so much that they’ve done it 37 times in the past three years. So the question is: what would it take to move support for repeal beyond the Republican base? In 1989 Congress repealed the Medicare Catastrophic Coverage Act a short sixteen months after it was passed. Why? It increased costs to seniors and offered them things that they didn’t want. In the context of ACA the repeal scenario is feasible if premium prices rise so high that people who don’t qualify for subsidies (there are more of them than those who do) decide that they really don’t want the enhanced packages envisioned in the law and then get really mad and let their representatives know it.

Where will we end up? Stay tuned.

Authors

Elaine Kamarck

Image Source: © Jonathan Ernst / Reuters

Free Trade Is Not Quite President Obama's Neglected Stepchild, But...

Bill Frenzel — Wed, 01 May 2013 00:00:00 -0400

In the first Obama term, trade was not quite a step-child, but neither was it a priority. Mostly, the Obama trade team concentrated on improving enforcement of trade laws. That is useful work, but it’s no fun for trade enthusiasts. They would rather play offense by opening markets instead of looking for ways to slow down trade.

The team did manage to complete 3 trade treaties handed to it by its predecessors. Only one of them, Korea, required significant renegotiation. The President’s most important trade action was the initiation of the Trans-Pacific Partnership (TPP) negotiations, effectively managed by U. S. Trade Representative Ron Kirk.

Political polarization makes everything difficult, but the Administration faced other daunting trade problems, too. One of its principal constituencies, big labor, opposes most trade treaties. That labor position has been a powerful deterrent to trade expansion policies.

Most important treaties passed by other administrations in the post-war period were handled under the “fast track” process, now called Trade Promotion Authority, which guarantees an up or down vote in both houses. President Obama and his trade people have never had that authority.

The 2013 State of the Union address was the first sign of change. In it, the President served notice that he has moved trade up the priority ladder in his second term. He cited two major negotiations: the TPP which he hopes to complete this year; and a new initiative, the Trans-Atlantic Trade and Investment Partnership (TTIP).

The Trans Pacific Partnership has been moving along through a dozen and a half negotiating sessions. Until a few months ago, it had a less than impressive list of participants. Then Canada decided to join. Japan followed shortly. Those new entrants, and others as yet unannounced, but known to be waiting in the wings, gave a dose of steroids to the TPP. It began to look more muscular, and therefore more attractive to American businesses.

Surprisingly, the push for TTIP originated in Europe. There, leaders tired of recession and austerity saw it as an economic booster shot. Apparently, President Obama thought so, too. He accepted the difficult challenge of negotiating a Trans-Atlantic agreement. This long-time dream of American and European trade expansionists will require extended and arduous negotiations with no assurance of completion in the next 3.5 years left in Obama’s term. But, it is a prize worth the effort. Europe amounts to about 20% of total US two-way trade.

Taken together, TPP and TTIP form an aggressive effort which, if successful, could be the needed substitute for the moribund WTO Doha Development Round. They could spark a growth spurt in world trade. They also might be the force which causes the WTO multinational Doha Round to arise from its sick-bed. This new Obama trade priority has escalated US trade policy from the minor leagues to the majors.

Last week came more good news on the trade front. Stories from the White House indicate that the President intends to nominate Michael Froman as his new US Trade Representative to replace Kirk, who returned to private life after 4 years on the job. Froman, is a White House insider who previously advised the President on international economic policy, and who is held in high regard by many business people.

The US has been fortunate to have a succession of great Trade Representatives over the 50 year history of the office. Some of the most effective have been those who enjoyed both the ear, and the confidence, of the President. Those who lacked ready access to the President found the job more difficult. If history is any guide, Froman would seem to possess a critical asset for his new trade job.

In the first Obama term, some trade observers were wont to say that the President was wasting the most pro-trade Congress in years. This term will test that assessment of both the President and Congress. Will Congress’ pro-trade proclivities allow it to overcome the polarization that has stalemated the legislative process? Or will the on-going fist-fight under the Capitol dome doom trade legislation that might otherwise claim majority votes?

Trade’s higher priority and increased visibility are assured, but its success is not. The Congress has the right inclinations. The President is showing leadership. The omens appear favorable. But, both branches of government have a long way to go before they can bring home the difficult treaty legislation needed to increase US and world trade.

Authors

Bill Frenzel

Publication: Forbes

Image Source: © Larry Downing / Reuters

Fund - Don't Cut - U.S. Soft Power

Michael E. O'Hanlon and Gen. David Petraeus — Tue, 30 Apr 2013 00:00:00 -0400

The president’s budget proposal is now on the streets of Washington, D.C. Currently, it would protect funding for the State Department and the Agency for International Development and related activities from further cuts. The combined annual budget for development aid, security aid and diplomacy has averaged close to $60 billion over the past half decade. That is now slated to decline to about $50 billion, partly due to reduced war-related costs. But this amount could come under intense scrutiny. Moreover, if there is no grand bargain between the president and the Congress, sequestration could force reductions of a further 10 percent.

Such an outcome would be bad for our nation’s security. As each of us has testified on Capitol Hill in past years America’s ability to protect itself and advance its global interests often depends as much on its “softer” power as it does on our nation’s armed forces. For example, though Latin American countries were themselves primarily responsible for their progress, the headway many of them made in stabilizing their countries in recent years has been a big plus for American security, too — and American aid had a role in that progress. That is part of why we have supported a budget deal that would repeal sequestration and achieve most further deficit reduction through savings in entitlement spending with similar increases in revenue generation. Implicit in our approach was the thinking that lawmakers should avoid the temptation to gut foreign aid just because it generally lacks a strong constituency in the United States.

America’s spending on development and diplomacy and security aid — the so-called 150 account — has strengthened under Presidents George W. Bush and Barack Obama. That has been a positive and long overdue development. Funds for diplomacy and development were starved in much of the 1990s. Some of the reductions in that earlier period were warranted, admittedly, as aid then was not always as productive as it might have been.

Today, we are arguably doing a good deal better. Various forms of development assistance and aid have, in fact, produced impressive results on a host of fronts in recent years. The President’s Emergency Plan for AIDS Relief, a major initiative of Presidents Bush and Bill Clinton and now President Obama, has played a significant role in helping to turn the tide against the HIV/AIDS epidemic — even if more work remains to be done. Development assistance has also helped more than 600 million people move out of extreme poverty, achieving one of the United Nations Millennium Development Goals several years before the 2015 target date.

Moreover, as John Podesta has recently written, in this century alone, aid has helped reduce the global childhood mortality rate by one-third — impressive, even if only halfway toward the U.N. goal for 2015. The maternal mortality rate has been reduced by almost half, as well. And progress has been seen in other sectors — such as agriculture, energy and other realms, including many in the combat zones where each of us spent considerable time in the past decade.

America deserves considerable credit for much of this progress, as the U.S. is the world’s largest aid contributor, at roughly $30 billion in 2012. The United Kingdom, Germany, France and Japan round out the rest of the top five donors, each providing from $10 billion to $15 billion a year. But relative to our economy’s size, America does not do more than its fair share; it provides just 0.19 percent of gross domestic product in development aid, similar to Japan’s level but less than half that of the three big European donors listed above, and less than a third the U.N. goal of 0.7 percent of GDP. Private donations improve our net national position somewhat, but only to an extent. The State Department budget is still less than 5 percent of the military’s — and the number of Foreign Service officers worldwide is less than half the number of soldiers in a single Army division.

Given our military contributions to international stability and the global economic growth that results from that stability in various areas, American foreign aid doesn’t need to grow substantially. But it should not be cut further. Consider some of the ideas we might want to consider in the years ahead. These should not be unconditional offers of help but would require the right kind of cooperation from key nations abroad whose future stability is central to our own security:

A possible deal to help Egypt revive economic growth and service its debt after a two-year economic downturn following its Arab Spring; this would be contingent on President Mohamed Morsi respecting the Egyptian constitution and helping us with Middle East peace;

A possible proposal to help Pakistan reinvigorate its energy sector, which currently holds back the country’s growth and compromises its quality of life; this would be contingent on Pakistan contributing more to security in the region and to pursuing reforms that reduce disincentives for significant private initiatives in the energy arena;

A major push with other donors to help countries like the Democratic Republic of the Congo reform and strengthen their security forces;

Aid for transitional governments in Libya, Yemen and Mali, and perhaps someday Syria, to get on their feet so they can stabilize, develop security forces, police their own territories and prevent terrorists from establishing sanctuaries;

Ongoing help in future years for Afghanistan’s government provided that it takes steps toward better governance and a sound election in 2014.

This agenda need not break the bank; even taken together, development aid and assistance and these initiatives would not remotely add up to another Marshall Plan. But this discussion suggests that our security will be improved by sustaining foreign aid in the years ahead rather than by making further cuts.

Authors

Michael E. O'Hanlon
Gen. David Petraeus

Publication: POLITICO

Image Source: © Akhtar Soomro / Reuters

Why Congress is Failing Us

Thomas E. Mann and Norman J. Ornstein — Fri, 26 Apr 2013 15:54:00 -0400

Editor’s Note: Norman J. Ornstein is a resident scholar at the American Enterprise Institute. Thomas E. Mann is a senior fellow at the Brookings Institution. They are co-authors of “It’s Even Worse Than It Looks: How the American Constitutional System Collided With the New Politics of Extremism.” On April 26, 2013, Mann and Ornstein discussed why Congress is failing the American people in a Moyers & Company video interview:

Why Congress is Failing Us from BillMoyers.com on Vimeo.

Veteran Congress-watchers Thomas Mann and Norman J. Ornstein spoke with Bill Moyers about the Senate’s failure to make progress on gun control in April despite 90% of the American public supporting background checks. Though leadership is contextual and there have been historically dysfunctional legislatures, today’s extreme political polarization is unique and the American people are those affected the most by partisan polarization.

In the interview, Thomas Mann explains that "sadly, divided party government, which we have because of the Republican House, in a time of extreme partisan polarization, is a formula for inaction and absolutist opposition politics, not for problem solving. It wasn’t that long ago when you could actually get something done under divided government.”

How do Mann and Ornstein reply when Bill Moyers asks who wins and who loses when we have this deadlock and dysfunction?

Norman J. Ornstein: Well first of all the public and future generations really do lose. We have real problems, short and long term, in the country…

Thomas Mann: …We’ve been living through, now, years of stagnant wages, of high unemployment, of growing economic inequality. So the work of our legislature, our government, makes a big difference. And right now those issues are not being addressed in any substantial way because of the dysfunctional politics and because the Republican party has drifted so far from the mainstream of our politics.

Watch the full video on billmoyers.com »

Authors

Thomas E. Mann
Norman J. Ornstein

Publication: Moyers & Company

Image Source: © Larry Downing / Reuters

An Examination of the Judicial Conduct and Disability System

Russell Wheeler — Thu, 25 Apr 2013 13:30:00 -0400

Editor's Note: Russell Wheeler testified before the House Judiciary Subcommittee hearing on the federal judicial conduct and disability system on April 25, 2013. The Judicial Conduct and Disability Act of 1980 authorizes any person to file a complaint alleging that a federal judge has engaged in conduct "prejudicial to the effective and expeditious administration of the business of the courts." The text which follows is Russell Wheeler's opening statement.

Chairman Coble, Ranking Member Watt, Vice-Chairman Marino, and members of the Subcommittee: Thank you for this opportunity to testify at this oversight hearing examining the federal judicial conduct and disability system, and thank you for the oversight itself. Proper legislative oversight of the other two branches is a vital part of the checks and balances embodied in the Constitution. By way of summary, I believe the judicial branch is doing, overall, a very good job of administering the Act, which largely involves sifting through a high number of insubstantial and often frivolous complaints to find the few that justify further investigation.

Since September 2005, I have been a Visiting Fellow in the Brookings Institution’s Governance Studies Program and president of the Governance Institute—a small, non-partisan, non-profit organization that since 1986 has analyzed various aspects of interbranch relations. In both positions I have been especially interested, among other things, in various aspects of judicial ethics regulation.

Before assuming these positions I was with the Federal Judicial Center, the federal courts’ research and education agency, serving as Deputy Director since 1991. While at the Judicial Center and for about a year at Brookings, I assisted the six-member Judicial Conduct and Disability Act Study Committee, appointed in May 2004 by Chief Justice William H. Rehnquist and often referred to as the “Breyer Committee,” after its chairman, Associate Justice Stephen G. Breyer. The committee—Justice Breyer, two former chief circuit judges, two former chief district judges, and the Chief Justice’s administrative assistant— reported to the Judicial Conference of the United States in September 2006,[1] after which a renamed Judicial Conference Judicial Conduct and Disability Committee developed new, mandatory rules governing the processing of complaints, rules that the Conference approved in March 2008. [2]

Credit for the report and the subsequent rules goes in part to the House Judiciary Committee and its then-chairman, Representative F. James Sensenbrenner, who called attention in early 2004 to what he regarded as an improper dismissal of a judicial conduct complaint he had filed (the Breyer Committee subsequently agreed that the dismissal was improper)[3]. Chief Justice Rehnquist said in announcing the committee appointments, “There has been some recent criticism from Congress about the way in which the Judicial Conduct and Disability Act ... is being implemented, and I decided the best way to see if there are any real problems is to have a committee look into it.”[4]

The relatively few problems highlighted by the Breyer Committee, and the process enhancements in the 2008 rules, have no doubt led to improvements in how the federal courts handle complaints filed under the Act, although, as the Committee report documented, the courts had already been doing, overall, a very good job. In this statement, I describe the Breyer Committee’s methods and principal findings, and then offer a few fairly modest suggestions to strengthen further the judicial conduct and disability system.

The Breyer Committee and Its Work

At the outset, let me make very clear that I speak only for myself and in no way claim to speak for the Breyer Committee (which went out of existence after it filed its report) or for any former members of the committee or its small research staff (or, for that matter, for my two current affiliations).

What it did Working with two Judicial Center researchers and one from the Administrative Office of the U.S. Courts (and me as a coordinator of sorts), the committee selected two samples of complaints terminated from 2001-03: a 593-complaint sample, selected to overrepresent complaints most likely to have alleged behavior covered by the Act (e.g., the sample included a larger percentage of complaints filed by attorneys than in the initial unmodified sample and a lower percentage of complaints filed by prisoners) and a separate sample of 100 terminations drawn totally at random. It also identified 17 complaints terminated from 2001 to 2005 that received press or legislative attention—“high visibility complaints”.[5]

The research staff reviewed the 593 complaints and terminations to identify “problematic” terminations, based on committee-approved definitional standards[6] and after committee review of a subset of initial staff reviews to ensure the staff was applying the standards as the committee wished. The committee members alone reviewed the smaller 100-case sample without staff assistance. (The various forms for reviewing the complaints are in the report appendices.)

The purpose of both reviews was not to determine if the subject judges had committed misconduct or displayed performance-degrading disabilities but rather to assess whether chief circuit judges and judicial councils applied the statute as intended—mainly whether the chief judge conducted a “limited inquiry” (as the Act authorizes) sufficient to justify dismissing the complaint or concluding the proceeding, but not an inquiry that invaded the investigatory role reserved for a special committee.

Finally, staff, using survey instruments approved by the committee, interviewed current former chief circuit judges and staff.

What it found The committee concluded that 3.4 percent of the 593 stratified sample of terminations were problematic, as were 2.0 percent of the terminations in the 100 straight random sample complaints (not surprising given the larger sample’s oversampling of likely meritorious complaints). The Committee found a greater proportion of problematic dispositions among the high-visibility complaints (five of the seventeen), which it attributed to those complaints’ greater likelihood to confront the chief judge or circuit council with more decisions, and thus a greater chance of at least one incorrect decision. The Committee expressed concern that these five problematic dispositions could take on outsize importance because of their visibility, and convey an inaccurate impression to the public and would-be filers of the Act’s effectiveness.

To be clear, this was a methodologically rigorous analysis that let the chips fall where they may. (The non-partisan American Judicature Society praised the report for “not hiding the federal judiciary's dirty linen in the closet,” and for “thoroughly discuss[ing] situations in which the judiciary's performance was deficient [and] the causes that may be responsible”.[7]) The committee imposed strict—some might even say too strict—criteria in its review of the terminations it assessed. For one example, a complaint by a prisoner alleged that the person on the bench in a hearing in his case was a young man, probably the judge’s intern, not the judge. The judge informed the chief circuit judge that he had no intern at the time of the hearing and his law clerk was a middle-aged woman, after which the chief judge dismissed the complaint. The committee characterized the allegation as “bizarre, [but] not so outlandish as to be what our Standard 4 calls ‘inherently incredible,’” and classified the disposition as problematic because the chief judge did not obtain, or order his staff to obtain, the electronic recording of the proceeding to verify that the voice on the tape was that of the judge.[8]

These findings suggest that, despite occasional problematic dispositions, proper administration of the Act is by and large engrained in the culture of federal judicial administration. One might ask whether a replication of the research conducted on a more recent sample of cases would find the same low level of problematic dispositions. Obviously, we cannot know that without the replication itself, but there are reasons to suspect that such a replication would find performance at least as favorable as that found by the committee. One reason is the mandatory committee rules and the tougher enforcement and oversight regime they mandate. Also, though, the Breyer Committee findings track very closely those of an earlier study, conducted in 1991-92, using the same basic methodology, for the statutory National Commission on Judicial Discipline and Removal, chaired by former Congressman Robert Kastenmeier. The earlier study used only one modified random sample (of 469 complaints) and found a 2.6 percent problematic disposition rate (compared to the 3.4 percent that the Breyer Committee found in its 593-case sample). The difference is not statistically significant.[9]

Informal discipline outside the Act Finally, the committee interviews tracked a widely shared view within the federal judiciary, namely that informal resolution of misconduct and disability, perhaps in the shadow of the Act, is more extensive than resolutions that result from formal complaints. This is especially so as to performance-degrading disability, which is rarely the basis for complaints under the statute.[10]

Committee Recommendations and Additional Steps

The Committee offered twelve recommendations, principally to provide additional information to chief judges and councils including a vigorous role for the Conduct Committee; to provide additional information about the Act to potential users; and to enhance publically available information about the Act and its implementation. The judicial branch, mainly through the new rules, has adopted many of the recommendations. I am also aware of Professor Arthur Hellman’s specific proposals to improve the implementation of the Act, mainly in the areas of transparency, disqualification of certain judges in judicial conduct proceedings, and review of chief judge and council orders. Professor Hellman is probably the country’s leading expert on the federal judicial and disability system. In general I share his concerns and endorse his proposals, and add here only a few additional comments.

The role of the Conduct Committee The Act is clear that the chief judge, upon receipt of a complaint, may undertake a “limited inquiry” but “shall not undertake to make findings of fact about any matter that is reasonably in dispute.”[11] A complainant may appeal a chief judge’s dismissal order to the judicial council, but a judicial council’s “denial of a petition for review of the chief judge’s order shall be final and conclusive and shall not be judicially reviewable on appeal or otherwise.”[12] Perhaps because of some reported instances in which chief judges appear to have dismissed complaints after making findings of fact of matters reasonably in dispute—dismissals affirmed by the respective judicial council—Rule 21 seeks, in the words of its commentary, “to fill a jurisdictional gap.” It authorizes the Conduct Committee to consider, on petition of a dissenting council member or on its own initiative, whether the chief judge should have appointed a special committee. This is an important role for the Conduct Committee, even if it would be needed rarely. I tend to agree with Professor Hellman that a statutory change would help to clarify the Conduct Committee’s authority in such situations, rare as they may be.

In a related vein, the Breyer Committee recommended that the judicial branch monitor the Act’s administration periodically, but doubted that “a full-blown replication of our research would be necessary each time. This was a labor-intensive process for us, for our staff, and for the judges and supporting personnel in the circuits.”[13] The Conduct Committee has taken an important step in this direction by examining of some of the universe of terminations it receives from the circuits and doing so in a manner the highly respected Committee chair, Judge Anthony Scirica, characterizes as similar to the Breyer Committee’s review. Just as the Breyer Committee published summary data on its review of the terminations it examined and explained why some terminations were problematic, the Conduct Committee might release similar periodic summary analyses.

Providing information on how the Act has been interpreted The commentary to Rule 3 states that the “responsibility for determining what constitutes misconduct under the statute [“conduct prejudicial to the effective and expeditious administration of the business of the courts,” 28 U.S.C. § 351(a),] is the province of the judicial council of the circuit subject to such review and limitations as are ordained by the statute and by these Rules.”

The judicial branch needs a transparent way of accessing the decisions of the judicial councils (and chief judges) in order to allow chief judges, council members, and other process participants and observers a means of identifying and assessing the determinations the councils are making—accessing what some have called the common law of judicial misconduct and disability.

One of the Breyer Committee’s main recommendations was for selected orders to be posted on the judicial branch website “in broad categories keyed to the Act’s provisions, and . . . with brief headnotes.”[14] This recommendation is embodied to a degree in the Rules’ promise that the Conduct Committee “will make available on the Federal Judiciary’s website . . . selected, illustrative orders, appropriately redacted, to provide additional information to the public on how complaints are addressed under the Act.”[15] The Conduct Committee’s forthcoming on-line Digest of Authorities can make a valuable contribution to this end.

The Act itself also requires each circuit to make available in the court of appeals clerks office all written orders implementing the Act’s provisions.[16] The Rules bolster that provision by suggesting the courts’ websites as an optional form for making the orders public, and, in terms of transparency and ease of access, website postings are obviously the better option.[17] A preliminary review of circuit practices as I prepared this statement suggest that these circuits do so[18]:

First	All orders from 2008 following, ranging in number from 14 to 45 per year.
Seventh	All orders since 2011 (93 in 2012, for example) with earlier years available on website archives.
Ninth	794 orders, from 2006 and later
Tenth	About 500, since January 2008
DC	Orders from 2011-2013 (53, for example in 2012)

Two other circuits (the Second and Fifth) have posted a small number of orders in high-visibility complaints, and the Federal Circuit has posted 24 orders from 2008, 2009, and 2010.

These postings are surely a positive, if incomplete, step. At the risk of sounding unappreciative of the posting circuits’ efforts, however, analyzing the orders, to compare dispositions of similar complaints, or to assess how different chief judges and councils define or interpret the statute and the governing rules, would require wading into an undifferentiated mass of orders (including routine council orders affirming chief judge dismissals), identified only by date, case number, and, in some circuits, a generic description (e.g., “Order, Chief Judge” or “Order, Judicial Council”). A more helpful typology is necessary (along with indicating the page length of each order as a rough way to identify non-routine orders).

Enhanced orientation for chief circuit judges

The Breyer Committee recommended an individual, in-court orientation program for each new chief circuit judge, provided by an experienced current or former chief judge and a member of the Administrative Office General Counsel’s office who staffs the Conduct Committee, and that the Federal Judicial Center develop a common core curriculum for the program to promote uniformity in the Act’s implementation. The recommendation, along with others, for on-tap resources, was designed to ensure “‘that the chief judge is not out there alone’.” [19] I do not believe the Conduct Committee to date has requested the Federal Judicial Center to develop such a program, or some other program toward the same end. It is worth exploring, however, whether the Center is in a position to develop and administer such a program and curriculum, and whether the Conduct Committee perceives a need for it in light of the other steps it is taking in its advisory role.

Providing information on the Act to potential users The courts, based on my most recent and admittedly non-exhaustive review have done a fairly good job with another transparency-related Breyer Committee recommendation, namely making information readily available on court website about the Act and how to file a complaint. Not all courts that post such material place it on the homepage, as the Committee recommended,[20] but for the most part I do not believe the information is hard to find. The Judicial Conference Committee on the Judicial Branch, under its former chair, Judge D. Brock Hornby, and current chair, Judge Robert A. Katzmann, with the assistance of its Administrative Office staff, has aggressively reminded the courts of the Rules requirements for such posting.[21] The Breyer Committee found, in 2006, only marginal compliance with a previous suggestion for such posting, and found that those courts that were posting the information on their websites did not experience a greater proportionate number of filings.[22] It accompanied its recommendation with a suggested paragraph warning would-be filers that the chief judge would dismiss their complaint if it related to the merits of an underlying decision, and a fair number of courts appear to have adopted that suggestion.

* * *

Thank you for the opportunity to testify this afternoon. I will do my best to answer any questions you may have.

[1] “Implementation of the Judicial Conduct and Disability Act of 1980, A Report to the Chief Justice,” (Sept, 2006), available at http://www.fjc.gov/library/fjc_catalog.nsf/autoframepage!openform&url=/library/fjc_catalog.nsf/DPublication!openform&parentunid=C6CA3DC8B22AC2D78525728B005C9BD3

[2] Available at http://www.uscourts.gov/Viewer.aspx?doc=/uscourts/RulesAndPolicies/Misconduct/jud_conduct_and_disability_308_app_B_rev.pdf

[3] See report, id at note 1, at 73-75.

[4] Id at 131.

[5] Id at 39ff.

[6] Id at Appendix E, 144ff.

[7] “Politics and Progress in Federal Judicial Accountability,” Judicature (Sep’t., Oct., 2006), available at http://www.ajs.org/ajs/ajs_editorial-template.asp?content_id=530

[8] Id at 53.

[9] Id at 95ff.

[10] Id at ch. 5.

[11] 28 U.S.C. §352(a)

[12] 28 U.S.C. §352(c)

[13] Report at 123.

[14] Id at 117.

[15] Rule 24(b).

[16] 28 U.S.C. §360(b)

[17] Rule 24(b)

[18] The orders are available at these links:
http://www.ca1.uscourts.gov/?content=judicialmis.php;
http://www.ca2.uscourts.gov/judmisconduct.htm;
http://www.ca5.uscourts.gov/JudicialMisconductOrders.aspx;
http://www.ca7.uscourts.gov/JM_Memo/jm_memo.html;
http://www.ce9.uscourts.gov/misconduct/judicial_misconduct.html;
http://www.ca9.uscourts.gov/misconduct/;
http://www.ca10.uscourts.gov/misconduct.php;
http://www.cadc.uscourts.gov/internet/misconduct.nsf/DocsByRDate?OpenView&count=100;
http://www.cafc.uscourts.gov/judicial-reports;

[19] Report at 113

[20] Report at 120-21.

[21] Rule 28

[22] Report at 33

Downloads

Download the testimony

Authors

Russell Wheeler

Publication: House Judiciary Committee, Subcommittee on Courts, Intellectual Property and the Internet

Image Source: © POOL New / Reuters

Gridlock is No Way to Govern

Thomas E. Mann and Norman J. Ornstein — Fri, 19 Apr 2013 09:47:00 -0400

Editor’s Note: Norman J. Ornstein is a resident scholar at the American Enterprise Institute. Thomas E. Mann is a senior fellow at the Brookings Institution. They are co-authors of “It’s Even Worse Than It Looks: How the American Constitutional System Collided With the New Politics of Extremism.”

Larry Summers is a brilliant, award-winning economist. Monday, in his monthly op-ed column for The Post, he opined about politics and history [“Sometimes, gridlock is good for America,” April 15]. Our advice, as political scientists, is that Summers should stick to economics.

Summers painted a rosy scenario, saying that the frustration people feel at the slowness and gridlock of recent years is misplaced — that things were just as bad, if not worse, in the early 1960s; that the failures to enact health-care and welfare reform in the Nixon years were a good thing; and that more gridlock, not less, would have been helpful during the George W. Bush years. Summers also lauded the economic policies that have enabled the United States to avoid the double- or triple-dip recessions that have hit Europe, as well as passage of the Affordable Care Act and financial regulation, and advances in energy and the widespread acceptance of same-sex marriage.

We were left wondering what political system Summers has been living in the past several years. This level of partisan polarization, veering from ideological differences into tribalism, has not been seen in more than a century. The U.S. system has always moved slowly, but in times past major advances were achieved with some level of cooperation or restraint, if not consensus, between the parties. No more.

The progress on energy and the shift in public opinion on same-sex marriage have occurred with little or no relationship to Washington’s political pathologies. The policy triumphs that Summers trumpeted — stabilization and economic stimulus, health reform, financial regulation — were all achieved in the first two years of the Obama administration over the united, vociferous opposition of Republicans in Congress. The stimulus package passed in early 2009 was a major step to avert depression but was watered down and diverted into unproductive uses because of House Republicans’ strategic unwillingness to cooperate and the need to accommodate senators of both parties to get the 60 votes necessary to overcome a filibuster — one of countless episodes in the past five years when the filibuster has been used in unprecedented ways.

The Affordable Care Act and the Dodd-Frank reforms were enacted despite GOP obduracy and promiscuous use of the filibuster, in part because Democrats for a short time had 60 votes in the Senate and kept their members together. But the quality of both laws was diminished by the unwillingness of members of the minority to vote for the final product on the floor after many concessions they requested had been agreed to during committee markups. More important, passing laws in this fashion left nearly half the polity viewing the legislation as illegitimate. Efforts followed to demonize and hamstring the laws as they moved toward implementation — including the unprecedented blockage for years of highly qualified nominees to head the Centers for Medicare and Medicaid Services and the Consumer Financial Protection Bureau.

It is true that politicians of both parties came together in the fall of 2008 to save the financial system and economy from utter disaster — but only after House Republicans blocked the initial bailout plan and were chastened by a sharp drop in the stock market. That was followed in 2011 by congressional Republicans’ reprehensible use of the federal debt limit as a hostage, resulting in the first-ever downgrade in the United States’ credit rating. We are not confident that the result would be the same if there were an equally urgent need for action today to save the global economy.

To be sure, the United States has done better than Europe. But years after the initial crisis, and in significant part because of the shortcomings of our political system, we are still sputtering, having missed multiple opportunities to emerge from the financial crisis in a far better way.

Finally, Summers’s idea that climate change and inequality are issues not of gridlock but of vision forgets the fact that serious debates about policy avenues in these areas are impossible if half the political arena believes that climate change is a hoax, and if one political party is animated by the Grover Norquist no-tax pledge and the Mitt Romney vision of a nation of 53 percent makers and 47 percent takers.

Yes, there are signs of progress in our political system. The universe of problem-solvers in the Senate has increased since the 2012 elections. But the broader pathologies in our politics remain. For all the problems that existed in previous decades, in a system designed not to act with dispatch, there was a strong political center, with responsible bipartisan leadership. The same cannot be said today.

Authors

Thomas E. Mann
Norman J. Ornstein

Publication: The Washington Post

Image Source: © Jason Reed / Reuters

What's Behind all Those Judicial Vacancies Without Nominees?

Russell Wheeler — Thu, 18 Apr 2013 11:54:00 -0400

Last week, Senate Judiciary Committee ranking member Charles Grassley (R-IA.), said “we hear a lot about the vacancy rates. There are currently 86 vacancies for federal courts. But of course, you never hear the President mention the 62 vacancies that have no nominee. That is because those 62 vacancies represent nearly 75 percent of the total vacancies.”

This brief paper, after noting the considerable power that home state senators have over judicial nominations, reports that:

• Considerably fewer of the vacancies without nominees on April 12, 2013, could reasonably be expected to have had nominees by then, based on patterns in the previous two administrations.

• Of the vacancies without nominees, almost half are in states with two Republican senators, and those vacancies are older than those in other states.

• There are many more nominee-less vacancies now than at this point in President George Bush’s presidency.

• Of the vacancies that have received nominations, the time from vacancy to nomination was greater in states with two Republican senators.

• Although it is difficult to apportion responsibility for the number and age of nominee-less vacancies and the longer times from vacancy to nomination, we should consider a specific proposal for more transparency about pre-nomination negotiations that might produce more nominations, more quickly.

The Senate has long honored the concept of “senatorial courtesy”—a willingness to confirm judicial nominees only if the home state senators approve. Senate Judiciary Committee chair Patrick Leahy and most of his predecessors over the last half-century or more have refused to process nominees to whom home state senators have objected, although the form of the objections and the weight given to objections from majority and minority senators has varied.[1] This year, even the Senate majority leader couldn’t get a hearing for a Nevada state judge whom he had recommended, because his Republican colleague refused to let the nomination proceed. Home-state senators’ effective veto over judicial nominees leads to bargaining—how much currently, we outsiders can’t say—between the White House and home state senators to find nominees that the administration favors and that the home state senators are willing to let proceed. The practice now seems to be, in general, that senators propose district nominees to the White House and react to potential court of appeals nominees proposed to them by the White House.

Number and age of vacancies without nominees

As of Friday, April 12, 2013, 71 actual and future vacancies on the district courts did not have nominees before the Senate, nor did 13 court of appeals vacancies. (A “future” vacancy refers to a judgeship occupied by a judge in active status who has announced publically that s/he plans to leave active status at some future date. The Judicial Conference of the United States encourages judges to give a year’s notice of their intention to leave active status, but not all judges do so.)

Only 33 of the 71 district vacancies, however, and nine of the appellate vacancies occurred or were announced before the August 2012 recess. For this and the previous two administrations, vacancies occurring after those fourth-year recesses have not received nominations until mid-April or later of the fifth year, except for one of President Barack Obama’s nominees.[2] The 33 district and nine circuit vacancies also exclude those that became nominee-less when, after the August recess, a nominee withdrew or was not resubmitted. (For example, the Nevada nominee referenced above asked the president to withdraw her nomination on March 13, 2013. Although the president had nominated her in February 2012 for a vacancy created in August 2011, the new date of the vacancy is the date of the withdrawal, and, for that reason, is not one of the 33 district vacancies.)

District vacancies The table shows that of the 32 vacancies in district courts with Senate delegations, almost half—15—were in the 14 states with two Republican senators—including six in Texas, three in Georgia, and two in Kentucky.

Eight of the vacancies are in the18 states with two Democratic senators, including three in California and two in New York. Nine are in states with a mixed delegation, including two in Illinois, three in Pennsylvania, and two in Wisconsin (and one in Massachusetts that was announced three and a half years ago, when the state had a mixed delegation, even though the delegation reverted to all Democratic in January 2013). These 32 nominee-less vacancies include three that once had a nominee who dropped out—two in two-Republican senator states and one in a split-delegation state.

The nominee-less vacancies in the states with two Republican senators are considerably older than those in states with two Democratic senators—measured in average days from the vacancy date, here defined as when it was announced, when it was created if no announcement, or Inauguration Day for vacancies that Obama inherited. Average age of the district vacancies in states with two Republican senators is 672, versus 649 for states with mixed delegations, and 471 for states with two Democratic senators.

Court of appeals vacancies Court of appeals judgeships are not statutorily assigned to particular states within the circuit but strong and rarely disputed traditions dictate that each judgeship belongs to a particular state.

Of the six nominee-less appellate vacancies in states with Senate delegations, four are in states with two Republican senators (Georgia, Kansas, and two in Texas). One is in Wisconsin, where the incoming Republican senator made clear in early 2011 that he would veto a nominee whom the administration first submitted in 2010 and resubmitted in 2011. The Kansas vacancy also had a nominee who dropped out after the two senators would not allow the nomination to proceed. The other is a vacancy on the Ninth Circuit’s Court of Appeals—the oldest vacancy in the country—that has been the object of one of the rare interstate disputes over the seat’s proper location, this one between the California and Idaho Senate delegations. (The 1,543 days shown are from the 2009 Inauguration Day; the vacancy dates to 2004.)

The average age of the four nominee-less appellate vacancies in the judgeships from states with two Republican senators is 529 days and much longer for the Wisconsin vacancy.

Bush Administration Nominee-less Vacancies in April 2005

The current situation is different, certainly as to the district courts, than the one that prevailed early in President George W. Bush’s second term, as shown on the table below, indicating pre-2004 recess vacancies that had no nominees by mid-April 2005, and the days that had elapsed since the vacancies’ creation or announcement.

In 2005, there were five nominee-less district vacancies, as opposed to 33 now, in part because the Senate had confirmed 97 percent of Bush’s pre-recess district nominees, as opposed to 90 percent of Obama’s, and Bush submitted only three nominees from the recess through mid-April, versus 15 by Obama. The three nominee-less appellate vacancies are three fewer than the current six vacancies in states with Senate delegations. Two were in California, one a vacancy for which the administration did not resubmit its initial 2013 nominee due to the home state senators’ objections. The extended vacancy reflected in part a dispute over whether the judgeship belonged to Maryland or Virginia.

Time from vacancy to nomination

What about judgeships that got nominees, whether confirmed or not? The table below shows the total number of Obama district nominees as of April 12, 2013.

On average, the Obama administration has submitted its 171 district nominees 406 days after the date of vacancy. The average for the 28 nominees in states with two Republican senators was 457 days, compared to 412 for the 94 two-Democratic senator state nominees and 364 for the 43 split-delegation state nominees. These figures, though, show the analytical difficulties created by changes in the make-up of Senate delegations; three long-pending Pennsylvania nominations could be ascribed to either the mixed or two-Democratic group. I have ascribed them to the latter, but ascribing them to the former would increase the average days for mixed delegation state nominations to 419 and reduce those for two -Democratic states to 387.[3]

There was considerable variation within the three categories. The six Texas nominees waited on average 603 days from the date of vacancy (as defined above), while the four in South Carolina waited only 286. The nine in Florida, with its mixed delegation, waited 353 days. The two Pennsylvania nominations clearly ascribed to the mixed delegation group waited 665 and 850 days, while the three I ascribed (almost by a flip of the coin) to the two-Democratic category waited 1,152 days on average. The 20 New York nominees waited 399 days on average, and the six in Illinois when it had two Democratic senators waited 275 days.

Average days for making circuit nominations were lower in all categories. There were not enough nominations for individual states to identify reportable variations.

What explains these differences?

We can only speculate, but no doubt both the Obama White House and at least some of the senators bear some responsibility for the high number of long-lasting nominee-less vacancies, and the long times from vacancy to nomination. The 391 days on average from date of district vacancy to nomination in two-Democratic senator states under Obama is longer than the overall time for all nominations under Bush to this point—276 days on average (At this point, Bush circuit nominees had waited on average 300 days for nominations.)

Perhaps the Obama White House has been slower to suggest potential nominees in states with Republican senators, or react more slowly to suggestions from those senators. Perhaps Republican senators insist, more than their Democratic counterparts, on nominees they proposed over White House objections or object more to White House-proposed nominees. The entire Senate Republican caucus told the White House by a March 2009 letter that “if we are not consulted on, and approve of, a nominee from our states, the Republican Conference will be unable to support moving forward on that nominee. . . .”[4] Perhaps Democratic senators from mixed-delegation states are the hold-ups, or perhaps Democratic House of Representative delegations have also stymied quick nominations by insisting that the White House pay attention to them as well as to their Republican senator counterparts.

Because we can only speculate on White House-senator negotiations, consider the proposal by Columbia Law School’s Michael Shenkman, a former Senate Judiciary staffer who later worked in the Obama administration. He has proposed that White Houses publish “the status of pre-nomination negotiations, although not the names of the [potential] nominees themselves.”[5] Senators could call out what they regard as misleading administration information, bringing the dispute into the open for verification. All in all, “[l]ocal editorial pages across the country would be newly equipped to comment on who is holding up the filling of” vacancies.[6] (Shenkman’s proposal is aimed at district vacancies, because his main objective is to try to fix the somewhat more fixable district judge confirmation process. Restricting the greater transparency proposal to potential district nominees may be the best way to inject any transparency into the process at all. The proposal, though, may merit consideration for court of appeals vacancies as well.)

The form of disclosure would resemble the Administrative Office of the U.S. Courts’ on-line list of “Current Judicial Vacancies,”[7] from which I have drawn some of the data for this short analysis. It displays the vacancy and the date it was actually created, the previous incumbent, the name of any formally submitted nominee, and the date of the nomination. The administration Web page would add to this information, for each vacancy without a nominee, the date on which the incumbent gave notice of the forthcoming vacancy or the date the vacancy was created in the absence of such notice, the date when the White House received senators’ recommendations, and an administration statement on whether it is still considering the unnamed, potential candidates or whether the administration has requested new names.[8] Where the administration initially provides names to senators for comment, the list could identify the date the names were provided, the date of any senatorial response, and, again, whether the administration is still considering the candidates. The administration list, to repeat, would include no names except those of the previous incumbents and those of nominees formally submitted to the Senate.

Shenkman acknowledges that candidates submitted to the White House who are identified in senatorial press releases or by the rumor mill could be embarrassed if they do not get the nomination, but argues the “[a]dministration’s priority should be on the health of the overall process.” Senators might not like the light such a list would shed on their dealings with the White House, but Shenkman argues that it would be difficult for senators to frame a principled objection to such disclosures, which could help repair the overall process.

* * *

At the least, such a public list (and any disputes over its accuracy) would shed more light on the vacancy situation than merely counting the number of nominee-less vacancies.

Download the full paper »

[1] See M. Sollenberg, The History of the Blue Slip in the Senate Committee on the Judiciary, 1917-Present (2003), http://wikileaks.org/wiki/CRS-RL32013 . Thanks to my colleague Sarah Binder for calling this document to my attention and for her comments on the phenomenon at issue.

[2] In February, Obama submitted a nominee to a vacancy announced in mid-August on the (senator-less) Court of Appeals for the Federal Circuit.

[3] The three dates of vacancy were in early to mid 2009, when the state had two Democratic senators after Arlen Specter’s switch in April 2009, and persisted through the almost two years of the two-Democratic delegation until nominations in mid-and late 2012, when the state had had a mixed delegation for over a year and a half.

[4] Manu Raju, “Republicans Warn Obama on Judges,” Politico, March 2, 2009, available at http://www.politico.com/news/stories/0309/19526.html.

[5]M. Shenkman, Decoupling District from Circuit Bench Nominations: A Proposal to Put Trial Bench Confirmations on Track,” 65 Ark. L. Rev. 217, at 299 (2012).

[6] Id. at 302.

[7] See star note at p. 1.

[8] Shenkman, op cit at 300.

Downloads

Download the full paper

Authors

Russell Wheeler

Image Source: © Chip East / Reuters

Defeat of Toomey-Manchin: Neither Cloture nor Closure for Victims of Gun Violence

John Hudak — Thu, 18 Apr 2013 14:21:00 -0400

Whither Representation? Yesterday’s failure to advance the Toomey-Manchin Amendment to expand background checks on gun purchases showed the American people that regardless of their preferences, regardless of what a majority of Senators want, regardless of the amount of compromise, some Senators refuse to represent their states.

Public polling is clear, and those who argue that polling is non-scientific, not truly capturing public opinion, are liberal machinations, or are biased in sampling and question wording remind us of those who expected a decisive Romney victory in November because all the polls were wrong. One poll could be off; two polls could fall victim to poor question wording. Yet, the reality of public opinion on background checks is well-established by a variety of sources including universities (here, here and here); in blue states, red states, and swing states; liberal sources and conservative sources; and the most well-regarded polling firms in the world (here and here).

Such support is not mixed. In almost every poll between 85%-91% of Americans support such reforms. Support is not regional, nor gendered, nor partisan, nor ideological, nor dependent on gun ownership. It is as broad-based as the reforms are moderate. It is as systematic as Toomey-Manchin is sensible.

Despite public opinion, 45 Senators failed to represent voters, and instead represented interest groups. (There were 46 Nay votes because Sen. Reid was required by Senate rules to switch his vote from Yea in order to reserve the right to recall the legislation at a later date—a common procedural move by Senate leaders.) They fell victim to pressure from a lobby who warned of national registries and criminalizing innocent behaviors. Chuck Grassley noted on the Senate floor yesterday that, “This is a slippery slope of compromising the Second Amendment, and if we go down that road, we are going to find it easier to compromise other things in the Bill of Rights.”

Senators failed to allow public opinion to get in the way of their voting. The same can be said for the facts. Fears about national registries arose because of interest group involvement and United States Senators constantly repeating talking points that diverged from reality. A quick reading of the Toomey-Manchin legislation shows that a national gun registry is explicitly banned in not one, not two, but three different places.

“Congress supports and reaffirms the existing prohibition on a national firearms registry.”

“Nothing in this title, or any amendment made by this title shall be construed to allow the establishment, directly or indirectly, of a Federal firearms registry.”

”Prohibition of National Gun Registry. – Section 923 of Title 18, United States Code, is amended by adding at the end the following:

"(m) The Attorney General may not consolidate or centralize the records of the-
(1)   Acquisition or disposition of firearms, or any portion thereof, maintained by-
    (A) a person with a valid, current license under this chapter;
    (B) an unlicensed transferor under section 922(t); or
(2)   Possession or ownership of a firearm, maintained by any medical or health insurance entity."

This language could not be clearer. Public support could not be stronger. And 45 Senators could not possibly have turned their back on their constituents in a more striking way.

Victims of gun violence—particularly families who suffered losses in the Newtown massacre—came to Capitol Hill not to promote their personal interests, not to promote their personal narrative above public will. They lobbied Senators to support something Americans overwhelmingly support.

Forty-five Senators worried that conducting background checks on gun buyers is a Constitutional violation and feared the wrath of interest groups who represent the views of 10% of the population on this issue. Now they must hope that when voters conduct their own background checks before going into the voting booth, that this vote is overlooked.

Authors

John Hudak

Why Congress Should Care About the International Aid Transparency Initiative

George Ingram — Wed, 17 Apr 2013 15:41:00 -0400

As the long-dreaded sequestration process begins to set in, U.S. government programs that have already been feeling the heat of budget pressures are now starting to feel the pinch. Across all agencies and departments, there has never been such heightened vigilance to determine the quality, value, and effectiveness of taxpayer-funded programs in order to save them from landing on the proverbial chopping block. U.S. foreign assistance is no exception, and in fact, is likely to be a popular target despite notable progress over the past decade in how aid is delivered.

One basic tool to help circumvent arbitrary and needless cuts is to make information related to foreign assistance transparent, accessible and comparable with the activities of other international donors. Congress has the important responsibility of choosing how much to allocate for activities that seek to lift millions out of extreme poverty, fight disease, spur growth and restore human dignity. In this challenging budget environment, that responsibility is of even higher consequence, with the potential to affect lives all around the world, either for the better or worse. But to make informed decisions, Congress needs to have at its disposal comprehensive, reliable data that is timely and up-to-date.

The Foreign Assistance Dashboard— a public website launched a little over two years ago by the Obama administration to examine this data— demonstrates a strong commitment to aid transparency. However, compliance from agencies involved in U.S. foreign assistance has been slow; the site still only has partial information (budget plans, obligations and expenditures) for a couple of agencies (USAID and Millennium Challenge Corporation) and just planning data for the State Department, leaving out more than a dozen others as well as critical program and project data that lie beneath the aid-flow surface.

The U.S. made another major commitment to the transparency agenda at the 2011 High Level Forum on Aid Effectiveness in Busan, South Korea, by joining the International Aid Transparency Initiative (IATI). Meeting the IATI commitments, particularly the publication of comprehensive and timely foreign assistance information, is incomplete and moving slowly.

Congress needs to understand that the dashboard and IATI are the tools it has been searching for. Members continuously complain about the opaqueness of foreign assistance – how much assistance is the U.S. providing, to what countries, for what purposes, in cooperation with whom, to what effect? Where is the information to explain to constituents how their tax dollars are being spent? Together the dashboard and IATI will provide this information.

Even more importantly, while there are varying opinions over the best uses and purposes for foreign assistance, members of Congress, Republicans and Democrats, are united in caring that foreign assistance dollars are used well – that tax dollars are not wasted and that the assistance does help lift individuals and countries from poverty and promote U.S. foreign policy interests.

IATI is a critical tool in contributing to the effective use of foreign assistance funds – and not just government provided assistance, but also that which is provided by private entities such as NGOs, foundations and corporations. It is currently the only place for comparable aid information. While the dashboard is a valuable domestic resource, IATI allows a wide range of stakeholders to know what the U.S. government is doing alongside what others are doing. This is the full aid picture and what recipients want to know on the ground.

As of April 2013, 39 government and multilateral donors, and over 100 private organizations, have committed to IATI. When fully operative and with timely and comprehensive data from all donors, we will have the ability through one website to find all donor activity in a particular sector and a particular locale in a country – a virtual one-stop-data-shop for foreign assistance. So how will this improve aid effectiveness?

Let’s say you are: (1) USAID contemplating investing scarce assistance funds in education in region X of country Y; (2) a congressional staffer whose boss has asked whether donors are helping to expand education opportunities in that region; (3) an NGO contemplating working in that region; (4) a finance ministry budget expert in country Y trying to figure out which school districts are in the greatest need of resources in the next fiscal year. IATI will provide the data to help answer these questions.

Through IATI, USAID will know which other donors are engaged in the region, at what level of funding, with what specific focus, and with whom it might coordinate. The congressional staffer can tell his member what donors and at what level education is being assisted. The NGO can tell if this region is overrun by its sister organizations or ignored and with whom it might partner. The ministry budget expert can better allocate scarce resources and query the education ministry staff as to whether it is integrating donor activity into national education plans.

The administration is to be commended for taking the leading in bringing U.S. assistance into the age of data transparency. It is now time for Congress to become involved, by supporting the administration but also by pushing for more robust implementation. Congressman Ted Poe does this in his bill, the “Foreign Aid Transparency and Accountability Act”, which passed the House in the waning days of the last Congress but was held up in the Senate. It is expected that he will soon reintroduce the bill. Congress should act swiftly to enact it into law and recommend that IATI be the standard by which all agencies in the aid space publish their data.

Authors

George Ingram

Image Source: © Philimon Bulawayo / Reuters

Which Military Opinions To Listen To

Paul R. Pillar — Thu, 11 Apr 2013 00:00:00 -0400

Editor's note: This article was originally published by The National Interest.

A recent study by Jim Golby, Kyle Dropp and Peter Feaver published by the Center for New American Security examines the effects that public statements by senior military officers have on public opinion about the use of force. The study is based on survey research in which respondents were presented with real and hypothetical questions about whether the United States should apply military force to certain situations overseas. Some respondents were told that U.S. military leaders favored the contemplated action, others were told that the same military leaders opposed the action, and still others were given no cues about what the military thinks. The main finding of the research is that publicly expressed military views do make a difference on public opinion, especially when such views oppose a military action. Military opposition reduced public support for the use of military force abroad by an average of seven percentage points, while military support increased public support by three percentage points. The surveyed sample was large enough that these were significant differences.

The authors discuss some concerns suggested by these findings, especially the hazard of what they call “a problematic politicization of the military.” Their concerns are legitimate, but the study fails to make an important distinction between the sort of military opinions that ought to worry us (worry us, that is, because they are being expressed publicly) and the sort that ought not.

The public (and policymakers in the executive branch and Congress) ought to pay careful attention to what senior military officers say on questions that are contained within the military's area of expertise. That is where military officers can offer opinions that are more firmly grounded than what anyone else can offer. Such questions would include the costs and time required to accomplish a military mission, risks incurred in accomplishing it such as collateral damage to civilians, and the likelihood of being able to accomplish it at all.

A military officer's opinion ought not to be considered worth more than anyone else's when it goes beyond the area of specifically military expertise. Outside that area would be questions such as political and diplomatic costs of an action, national priorities in the allocation of limited resources, and how important attainment of the military objective would be to the national interest. Because these sorts of questions are just as important in any decision to apply armed force overseas as are the ones on which military officers are specially qualified to speak, an overall judgment on whether any given application of force ought to be undertaken also goes beyond the area of military expertise. Thoughtful and intelligent military officers are going to have opinions about these things and are entitled to have them, but that is not the same as having a special claim on the public's attention.

If there is a norm to be cultivated here, it is that active-duty military officers ought to insist on being heard on military questions (which is not the same as the question of whether a particular military action ought to be undertaken), while being mindful of the politicization hazard that Golby, Dropp and Feaver mention and thereby not taking advantage of their prestige, their uniform and their credibility to offer publicly their opinions on other things.

Unfortunately, too often military opinion gets handled in exactly the opposite way. On one hand, armchair generals sometimes do not defer to the military on military questions. A well known and egregious example is the public disparagement by civilian Pentagon leaders of the army chief of staff's judgment about the U.S. troop presence that would be required in Iraq after the overthrow of Saddam Hussein. On the other hand, military officers' opinions on questions that go beyond strictly military judgments sometimes are given excessive prominence, usually because politicians either want to shirk the responsibility for making a decision by pretending that a military opinion can be treated as a surrogate for a policy judgment, or want to use military officers as supporting props for promoting their own point of view.

Authors

Paul R. Pillar

Publication: The National Interest

The Perils of Automatic Budgeting

Philip A. Wallach — Tue, 26 Mar 2013 11:00:00 -0400

In the fall of 1978, the United States Congress finally solved the federal government's budget problems. While the Senate debated a bill making some technical revisions to the Bretton Woods Agreement, Virginia senator Harry Byrd, Jr., offered an amendment that read, in its entirety: "Beginning with fiscal year 1981, the total budget outlays of the Federal Government shall not exceed its receipts." The amendment passed, and the bill was eventually signed into law.

The next year, in a bill increasing the debt ceiling, the overwhelmingly Democratic Congress again enacted essentially the same requirement for balanced budgets beginning in 1981. It did so again in 1980, and then in 1982 struck the reference to fiscal year 1981 but reiterated its "commitment" to balanced budgets. To this day, Title 31, Section 1103, of the United States Code reads: "Congress reaffirms its commitment that budget outlays of the United States Government for a fiscal year may be not more than the receipts of the Government for that year."

Of course, in all but four of the 30 years since, the federal government has indeed spent more than it has taken in — running an average annual deficit of more than $340 billion (adjusted for inflation) and well over a trillion dollars in more recent years. The debt held by the public has grown by more than $10 trillion in that time. Not surprisingly, promising to be fiscally responsible in the future has done nothing to mitigate the government's fiscal recklessness in the present.

And yet precisely that practice remains the essence of our fiscal policy today, as Congress and the president struggle to get the federal deficit under control. Now as then, their prayer is: Lord, make our budget sustainable — but not yet.

Our lawmakers contend that today's budget mechanisms are more effective than Senator Byrd's commitment to balanced budgets because they impose specific (if broad) spending cuts that will occur automatically unless Congress undoes them. There has been little recognition of the irony involved in continuing to make this argument even as lawmakers spent the past several months trying to avoid and then mitigate the consequences of a previously enacted mechanism of exactly the same sort: the sequester adopted as part of the 2011 debt-ceiling fight.

The automatic budget mechanism has long held Washington under its spell. But again and again it has disappointed, and for precisely the same reason that Byrd's balanced-budget language was meaningless: As a people no less sovereign than we, future voters (and, more to the point, their representatives) may not feel obligated to respect decisions made in years gone by.

At first glance, this inability to bind the future — which political scientists call the "commitment problem" — would seem to preclude the very possibility of responsible representative government, at least on matters that require sustained discipline (such as the management of the public debt). If representatives today can always put off hard choices until tomorrow — and especially if their voting constituents want them to — it is hard to see how any sacrifices will ever be made. And yet we know that responsible choices are possible, because our predecessors often made them. Balanced budgets in peacetime were the norm for most of our country's history until after the Second World War. Even in the aftermath of the New Deal and Great Society expansions, the polity has managed a few impressive moments of self-control — reining in runaway spending and reducing the growth of entitlement costs.

So why do most of our attempts to achieve such results through automatic budget mechanisms fail? And what has enabled those occasional fiscal successes? To answer these questions, we must first examine the automatic budget mechanisms employed over the past few decades, seeking to distinguish effective recipes for long-term balance from willful acts of self-delusion.

Read the rest of the article»

Authors

Philip A. Wallach

Publication: National Affairs

Image Source: © Kacper Pempel / Reuters

The Department of Energy’s Strategy for Exporting Liquefied Natural Gas

Charles K. Ebinger — Tue, 19 Mar 2013 15:00:00 -0400

Mr. Chairman, Ranking Member Speier, and distinguished Subcommittee members:

Thank you for inviting me here to share my views on U.S. LNG export policy. My name is Charles Ebinger and I am Director of the Energy Security Initiative at the Brookings Institution. These views are mine alone and do not reflect the views of the Brookings Institution, which does not take institutional positions on any policy issue.

The Energy Security Initiative at Brookings has been studying this issue for the past two years, having published an assessment of the case for LNG exports in May 2012 in our report, Liquid Markets: Assessing the Case for Exports of Liquefied Natural Gas from the United States.[1] In that report, we focused on two determinants of whether the U.S. should allow exports of LNG: what is the feasibility of exporting LNG, and what are the implications? After assessing both factors, my co-authors, Kevin Massy and Govinda Avasarala, and I came to two primary conclusions: first, the negative implications of LNG exports from the lower 48 states, which we believe to be technically feasible, are marginal and outweighed by the benefits; second, as the lynchpin of the globalized economy the United States must continue to espouse free trade and avoid intervening in a global market. Ultimately we believe, as we stated in our report, “that the United States should neither act to prohibit nor to promote LNG exports.”

In the 10 months since the release of this report, more studies and information—some good, some misleading—have surfaced. More opinions are being voiced. Amid the increased volume of debate, however, my opinion has not changed. I still believe that the benefits of U.S. LNG exports are, on balance, a benefit to the United States; that the United States still has the responsibility and the incentive to be an advocate for free trade; and that the U.S. government should not intervene in what should be a market-driven process.

I applaud this Committee for avoiding another acrimonious debate on the pros and cons of LNG exports by spending more time with both the implications of LNG exports and discussing some specifics reforms that might help rationalize the permitting process while clearly protecting the public interest.

Part 1: Implications

Any discussion surrounding the implications of U.S. LNG exports will focus on several considerations including the implications for domestic natural gas and electricity prices, the impact on other consumers of natural gas, and the impact on international prices and geopolitics.

Wellhead Prices

There have been a number of studies that have examined the impact of U.S. LNG exports on domestic prices. When analyzing them, policymakers should identify which study’s assumptions most resemble the existing natural gas market and its likely direction, and which models are most reflective of the complex nature of domestic and global natural gas trade. For instance, assuming realistic volumes of natural gas exports as well as a reasonable supply response by natural gas producers are two critical considerations. It is also important to note that the supply curves in the various studies reflect different interpretations of the economics of marginal production.

Under the most reasonable assumptions (in this case assuming 6 bcf/day of exports), most reports forecast that natural gas prices will be between 2 and 11 percent higher in 2035 than if the U.S. did not export LNG.[2] There are a number of factors that insulate domestic prices from dramatic increases in price as a result of exports. First, as will be discussed later, there is a market-determined limit on how much the United States can economically export, depending on domestic prices, the international gas market, and the global market for competing fuels. Second, the size of the resource base is substantial, an important factor because the EIA estimates that roughly 63% of the gas required to meet demand for LNG export will come from increased domestic production.[3] Finally, the domestic natural gas sector is very efficient and producers are able to respond rapidly to marginal increases in the domestic price.

Figure 1: Study-by-study comparison of the Average Price Impact from 2015-2035 of 6 bcf/day of LNG exports (unless otherwise noted)

Study	Average Price without Exports ($/MMBtu)	Average Price with Exports ($/MMBtu)	Average Price Increase (%)
EIA*	$5.28	$5.78	9%
Deloitte	$7.09	$7.21	2%
Navigant (2010) (2 bcf/day of exports)**	$4.75	$5.10	7%
Navigant (2012)***	$5.67	$6.01	6%
ICF International***	$5.81	$6.45	11%

* Price impact figure for EIA study reflects the reference case, low-slow export scenario.
** Navigant (2010) did not analyze exports of 6 bcf/day.
*** Navigant (2010 and 2012) and ICF International studies are based on Henry Hub price.
Source: EIA, Deloitte, Navigant, ICF International
Power Sector Implications

LNG exports are likely to have a modest impact on electricity prices as well. In the power sector, natural gas has historically been used as a back up to coal and nuclear base-load generation. For such gas used at the margin, the increase in electricity prices as a result of LNG exports will be limited by its competitiveness relative to other fuels: as soon as it becomes more expensive than the alternative for back up generation, power producers will move away from gas. According to ICF International, a $0.64/MMBtu increase in the price of natural gas will result in an electricity price increase of between $1.66 and $4.97/megawatt-hour (MWh), depending on how often gas is used as the marginal fuel for electricity. Deloitte estimates that the price increase of electricity will not be more than $1.65/MWh. EIA estimates that electricity price impacts will be marginal as well (between $1.40/MWh and $2.90/MWh) except in the “high rapid” export scenario. By contrast, the EIA Annual Energy Outlook 2013 estimates that, in its reference scenario, the average price of electricity (across all fuels) in 2035 will be $101/MWh, showing clearly the small impact that the rise in domestic electricity prices will have on consumers.[4]

Industrial Sector Implications

I am similarly skeptical about the negative consequences of exports on our industrial sector. Some of the more vocal industry opponents to LNG exports contend that price increases will reverse the trend of manufacturing investment returning to the United States. I firmly disagree with this assessment. For starters, I don’t believe that multi-billion dollar industrial investments in factories that will be a part of the capital stock for decades will be rendered unprofitable by single-digit percent changes to natural gas prices. As one analyst put it, “if your margins are so thin that [modest price increases] could break them, then there isn’t much benefit to putting up a plant here. Conversely, if it is so beneficial to do it here, then a small change in price probably won’t undermine those benefits.”[5]

For the petrochemical sector, the picture is even more positive. The prospects of large volumes of new supply suggest that the industrial sector’s competitiveness is stable regardless of U.S. export policy. Today the ratio of the price of oil to the price of natural gas is over 25:1. This is well over the 7:1 oil-to-gas price ratio at which the American Chemistry Council (ACC) believes U.S. petrochemical and plastics producers to be globally competitive. European and Asian petrochemical producers use oil-based products such as naphtha as a feedstock, as they lack access to cheap natural gas liquids (NGLs). Increased drilling will likely result in the greater production of the NGLs. This is one of the principal reasons why petrochemical producers are looking to return to the United States, after spending much of the previous decade relocating facilities overseas. According to a March 2011 report by the ACC, a 25 percent increase in ethane—a natural gas liquid—production will yield a $32.8 billion increase in U.S. chemical production.[6] To the extent that increased gas production linked to exports results in increased production of natural gas liquids, they will benefit the petrochemical industry.

International/Geopolitical Implications

Before diving too deep into the international pricing and geopolitical implications of U.S. LNG exports, it is worth reviewing the structure of the global LNG market, which is informally separated into three markets: North America, the Atlantic Basin (mostly Europe), and the Pacific Basin (including Japan, South Korea, Taiwan, China, and India). These markets are separated because of important technical differences that impact the pricing structure for LNG in each market. The North American natural gas market is competitive and prices are traded in a transparent and open market. The Atlantic Basin is dominated by European LNG consumers such as the United Kingdom, Spain, France, and Italy, and is a hybrid of a competitive U.K. market that was liberalized in the mid-1990s and a Continental European market that is partially dependent on oil-linked, take-or-pay contracts. In recent years, the U.K. hub, the National Balancing Point (NBP), has traded at a premium to the U.S. hub, known as the Henry Hub. The Pacific Basin is a more rigid market that depends heavily on oil-indexed contracts that are more expensive than those used in the Atlantic Basin. While they have no central trading hub, the Pacific Basin consumers such as Japan and South Korea currently import LNG based on a pricing formula known informally as the Japan Crude Cocktail, the average price of custom-cleared oil imports into Tokyo. Many Pacific Basin contracts have a built-in price floor and price ceiling depending on the price of oil.

Without exporting any natural gas, the U.S. shale gas “revolution” has already had a positive impact on the liquidity of global LNG markets. Many LNG cargoes that were previously destined for gas-thirsty U.S. markets were diverted and served spot demand in both the Atlantic and Pacific Basins. The increased availability of LNG cargoes has helped create a more competitive LNG market for other consumers. This in turn has helped apply downward pressure to the terms of oil-linked contracts resulting in the renegotiation of some contracts. In 2010 short-term and spot contracts represented 19 percent of the total LNG market, up from only a fraction one decade earlier. This trend is particularly prominent in Europe, where in 2012 nearly half of its gas supply came on a spot-price basis (see Figure 2). As will be discussed later, this trend in the European market towards cheaper oil-indexed rates and increased spot consumption has not only benefited European economies but is also helping loosen the stranglehold of Gazprom, Russia’s state gas company, on our east and west European allies and trading partners.

Figure 2: European Gas Supply by Contract Type (%), 2012

Source: Societe Generale

Although increases in domestic gas production have initiated some changes within the international gas market, any dramatic alterations to the existing structure will depend on the volume that is actually exported. With roughly 37 bcf/day of liquefaction capacity in the global market today, it is unlikely that the U.S. will export a significant portion of the nearly 30 bcf/day worth of applications currently proposed to the Department of Energy. Building an LNG facility requires billions of dollars in investment and years of planning. Prospective exporters must also undergo an intricate and thorough regulatory process and must be reasonably certain that the economic opportunity for any investment exists for two or more decades.

Given these sobering realities, I don’t see very many LNG projects—our estimates predict 4-6 bcf/day’s worth—being constructed before their economic opportunity and early-mover advantage is eroded by increased domestic gas prices (resulting from more gas consumption in the electricity and industrial sectors, sources of demand that are emerging faster than export facilities), decreasing international gas prices, and a more balanced global LNG market. This last point about LNG market equilibrium is critical. Our forecast suggests that from 2015 to 2020, the global LNG market will swing to a surplus, mostly aided by the nine Australian projects that already have or are close to reaching final investment decision (see Figure 3) as well as other new supplies from East and West Africa. Further, pipeline gas (particularly into China), and a stubborn coal market will also compete with gas in global energy markets, particularly those in Asia. Furthermore, as we move beyond 2025, the possibility of other countries—again, China in particular—developing their own shale gas reserves could begin to have an impact on international gas trade.

Figure 3: Global LNG Supply/Demand Balance, 2015-2020 (bcf/day)

Source: Brookings, IEA, EIA, Morgan Stanley, JP Morgan, Credit Suisse

U.S. LNG exports will therefore have a beneficial but not transformational impact on international LNG prices. The market is still largely dependent on long-term contracts and much of the new liquefaction capacity emerging in the next decade (largely from Australia) has already been contracted for at oil-indexed rates.[7] The incremental LNG volumes supplied by the United States at floating Henry Hub rates will be small in comparison. Indeed, importing U.S. LNG at Henry Hub rates includes a number of other costs, such as the cost to liquefy the gas and the cost to ship it on specialized tankers. (Depending on the type of contract, regasification is another cost that can be borne by either the buyer or the seller.) These costs range depending on the transportation distance and the size of vessel. As a reference point, it is estimated that shipments of LNG from the U.S. Gulf Coast to Japan will cost $5-6/MMBtu.[8] These additional costs dramatically reduce the arbitrage opportunity available to exporters.

There is also no guarantee that all U.S. exports will be supplied at floating U.S. prices. LNG export facilities are multi-billion dollar investments that require revenue certainty. Moreover, many of the export facilities are owned by producers of natural gas. John Watson, Chevron’s Chief Executive, said earlier this week that his company’s investments in LNG export facilities does not mean that natural gas will be available to consumers at U.S. rates.[9] Most producers prefer selling long-term supply contracts to reduce the price risk to their investments.

A large increase in U.S. LNG exports will have the potential to increase U.S. foreign policy interests in both the Atlantic and Pacific basins. Unlike oil, natural gas has traditionally been an infrastructure constrained business, giving geographical proximity and political relations between producers and consumers a high level of importance. Issues of “pipeline politics” have been most directly visible in Europe, which relies on Russia for around a third of its gas. Previous disputes between Moscow and Ukraine over pricing have led to major gas shortages in several E.U. countries in the winters (when demand is highest) of 2006 and 2009. Further disagreements between Moscow and Kiev over the terms of the existing bilateral gas deal have the potential to escalate again, with negative consequences for E.U. consumers. The risk of high reliance on Russian gas has been a principal driver of European energy policy in recent decades. Among central and eastern European states, particularly those formerly aligned with the Soviet Union such as Poland, Hungary, and the Czech Republic, the issue of reliance on imports of Russian gas is a primary energy security concern and has inspired energy policies aimed at diversification of fuel sources for power generation. From the U.S. perspective such Russian influence in the affairs of these democratic nations is an impediment to efforts at political and economic reform. The market power of Gazprom, Russia’s state-owned gas monopoly, is evident in these countries. Although they are closer to Russia than other consumers of Russian gas in Western Europe, many countries in Eastern and Central Europe pay higher contract prices for their imports, as they are more reliant on Russian gas as a proportion of their energy mixes.

In the larger economies of Western Europe, which consume most of Russia’s exports, there are efforts to diversify their supply of natural gas. The E.U. has formally acknowledged the need to put in place mechanisms to increase supply diversity. These include market liberalization approaches such as rules mandating third-party access to pipeline infrastructure, and commitments to complete a single market for electricity and gas by 2014, and to ensure that no member country is isolated from electricity and gas grids by 2015.

Despite these formal efforts, there are several factors retarding the E.U.’s push for a unified effort to reduce dependence on Russian gas. National interest has been given a higher priority than collective, coordinated E.U. energy policy: the gas cutoffs in 2006 and 2009 probably contributed to the acceptance of the subsea Nord Stream pipeline, which carries gas directly from Russia to Germany. Germany’s decision to phase out its fleet of nuclear reactors by 2022 will result in far higher reliance on natural gas for the E.U.’s biggest economy. The environmental imperative to reduce carbon emissions—codified in the E.U.’s goal of essentially decarbonizing its power sector by the middle of century—mean that natural gas is being viewed by many as the short-to medium fuel of choice in power generation. Ironically, in the near term the phase out of nuclear power has lead to greater reliance on both domestic coal as well as imported coal from the United States.

Finally, the prospects for European countries to replicate the unconventional gas “revolution” that has resulted in a glut of natural gas in the United States look uncertain. Several countries, including France and the U.K., have encountered stiff public opposition to the techniques used in unconventional gas production, while those countries, such as Poland and Hungary, that have moved ahead with unconventional-gas exploration have generally seen disappointing early results. Ukraine is also at a very early stage in developing its potential shale reserves. Collectively, these factors suggest that the prospects for reduced European reliance on Russian gas appear dim.

The one factor that has been working to the advantage of advocates of greater European gas diversity has been the increased liquidity of the global LNG market, discussed above. Russia’s dominant position in the European gas market is being eroded by the increased availability of LNG. Qatar’s massive expansion in LNG production in 2008, coupled with the rise in unconventional gas production in the United States as well as a drop in global energy demand due to the global recession, produced a global LNG glut that saw many cargoes intended for the U.S. market diverted into Europe. As mentioned previously, with an abundant source of alternative supply, some European consumers, mainly Gazprom’s closest partners, were able to renegotiate their oil-linked, take-or-pay contracts with Gazprom.

Increased LNG exports will provide similar assistance to strategic U.S. allies in the Pacific Basin. By adding supply volumes to the global LNG market, the U.S. will help Japan, Korea, India, and other import-dependent countries in South and East Asia to meet their energy needs. The desire on the part of Pacific Basin countries for the U.S. to become a gas supplier to the region has been underlined by the efforts of the Japanese government, which has attempted to secure a free-trade agreement waiver from the United States to allow exports. As with oil price-linked Russian gas contracts in Europe, U.S. LNG exports—to the extent they occur on a floating Henry Hub basis, have the potential to weaken the market power of incumbent LNG providers to Asia, increasing the negotiating power of consumers and decreasing the price. As U.S. foreign policy undergoes a “pivot to Asia,” the ability of the U.S. to provide a degree of increased energy security and pricing relief to LNG importers in the region will be an important economic and strategic asset.

Beyond the basin-specific considerations of U.S. LNG exports, they will provide a source of predictable natural gas supply that is relatively free from unexpected production or shipping disruption. With Qatar representing roughly one-third of the global LNG market, a blockade or military intervention in the Strait of Hormuz or a direct attack on Qatar’s liquefaction facilities by Iran would inflict chaos on world energy markets. While the United States government will be unable to physically divert LNG cargoes to specific markets or strategic allies that are most affected (gas allocation will be made by the market players), additional volumes of LNG on the world market will benefit all consumers. Further still, even if the volumes exported from the United States aren’t large, there is an ideological geopolitical benefit to U.S. LNG exports. Exports will provide certainty to allies and economic partners around the world that the United States is a steadfast advocate for free trade.

Part 2: Policy Solutions

In that context, I believe a prudent policy is to continue to allow exports. However, there will be a need to reform the existing rules pertaining to LNG exports in order to reduce the risk and uncertainty that is hurting both producers and consumers.

So what does such a policy look like? For starters, I disagree with the two most extreme proposals of a volumetric cap, or a policy where the U.S. automatically approves all applications. Both are treacherous to implement and may increase, rather than decrease uncertainty. A balanced approach is one that doesn’t increase the cost of exporting, but accurately reflects the cost of building a facility at the beginning of the process. I suggest a policy that requires a prospective exporter to have successfully gone through FERC’s pre-filing process and have a portion of its supply contracts signed before being eligible to be considered by DoE for an application to export to non-FTA countries. Both requirements are costly and will encourage only serious projects to move forward.

There will also need to be more clarity on the “public interest” determination, which is currently too vague and creates investor uncertainty. One possibility is to allow the “public interest” to be dependent on the aforementioned two stipulations. In other words, if a company completes its pre-filing process and contracts out a given percentage of its capacity, the exports are deemed to be in the public interest.

One final consideration is to have an audit of natural gas export policy every five years. This would be an important information-gathering exercise. Such an audit would identify what happened to domestic natural gas supply, demand, and prices, and international markets during each five-year period.

I would like to thank the Subcommittee for giving me the opportunity to provide my views on this important issue, particularly in helping move the debate forward. I look forward to taking the Committee’s questions.

[1] Charles Ebinger, Kevin Massy, and Govinda Avasarala, “Liquid Market: Assessing the Case for Exports of Liquefied Natural Gas from the United States,” The Brookings Institution, May 2012. (Brookings 2012) (http://www.brookings.edu/research/reports/2012/05/02-lng-exports-ebinger)

[2] Brookings 2012, pg. 33; Pricing studies include “Effect of Increased Natural Gas Exports on Domestic Energy Markets,” Energy Information Administration, January 2012; “Made in America: the economic impact of LNG exports from the United States,” Deloitte, December 2011; “Resource and Economic Issues Related to LNG Exports,” ICF International, August 17, 2011; “Market Analysis for Sabine Pass LNG Export Project,” Navigant Consulting, August 23, 2010.; and “Jordan Cove LNG Export Project Market Analysis Study,” Navigant Consulting, January 2012. Note that Navigant Consulting’s study of the Sabine Pass LNG project forecasted the pricing implications of 2 bcf/day.

[3] Brookings 2012, pg. 33

[4] Brookings 2012, pg. 34.

[5] Comment by Kevin Book, Managing Director, Research, ClearView Energy Partners, at “Liquid Markets: Assessing the Case for U.S. Exports of Liquefied Natural Gas,” on May 2, 2012 at the Brookings Institution in Washington, D.C. (http://www.brookings.edu/~/media/events/2012/5/02%20lng%20exports/20120502_lng_exports.pdf)

[6] American Chemistry Council, “Shale Gas and new Petrochemicals Investment,” March 2011.

[7] Brookings 2012, pg. 39

[8] For two estimates, see Ken Medlock, “U.S. LNG Exports: Truth and Consequences,” James A. Baker III Institute for Public Policy, Rice University, August 10, 2012 (http://bakerinstitute.org/publications/US%20LNG%20Exports%20-%20Truth%20and%20Consequence%20Final_Aug12-1.pdf); and Robert Smith, “Asian Natural Gas: A Softer Market is Coming,” Presentation to the U.S. EIA International Natural Gas Workshop, Washington, D.C., August 23, 2012.

[9] Ed Crooks, “Chevron explores first Canada gas exports,” Financial Times, March 12, 2013. (http://www.ft.com/intl/cms/s/0/aaa61d84-8b3e-11e2-b1a4-00144feabdc0.html#axzz2NeqtOvnR)

Downloads

Download testimony

Authors

Charles K. Ebinger

Publication: Subcommittee on Energy Policy, Health Care, and Entitlements, House Committee on Oversight and Government Reform

SORT vs. New START: Why the Administration is Leery of a Treaty

Steven Pifer — Fri, 15 Mar 2013 10:49:00 -0400

Yesterday’s blog—“Presidents, Nuclear Reductions and the Senate”—described how presidents over the past 40 years have sought to limit or reduce nuclear weapons by means other than a treaty requiring two-thirds majority approval in the Senate. Why would the Obama administration consider something other than a treaty? Because it fears that Republicans in the Senate would not consider a treaty on its merits. A comparison of the ratification experiences of the Strategic Offensive Reductions Treaty (SORT) signed by President George W. Bush in 2002 and the New Strategic Arms Reduction Treaty (New START) signed by Mr. Obama in 2010 provides Exhibit A for those fears.

SORT limited the United States and Russia each to no more than 1,700-2,200 “strategic nuclear warheads,” the level of nuclear weapons that the Bush administration’s 2001 nuclear posture review concluded was necessary for the United States—regardless of what levels of nuclear arms other countries had. Mr. Bush originally proposed that he and President Vladimir Putin merely make statements of national policy setting out their intended strategic force levels, but he later agreed to do a treaty at Mr. Putin’s insistence.

SORT was not much of a treaty. While START I and New START each made a good-sized book, SORT barely filled two pages. Curiously, it did not define a “strategic nuclear warhead” … or any other term for that matter. Lacking any monitoring provisions, SORT was unverifiable.

It appears, moreover, that Washington and Moscow did not even count the same weapons. The Bush administration defined “strategic nuclear warheads” as the same as “operationally deployed strategic nuclear warheads”—that is, nuclear warheads on intercontinental ballistic missiles (ICBMs) and submarine-launched ballistic missiles (SLBMs) plus nuclear bombs and air-launched cruise missiles stored at air bases for B-2 and B-52 bombers (as a normal practice, neither side’s air force keeps weapons on bombers). The Russians, however, apparently tallied only warheads on ICBMs and SLBMs. They did not count bombs or air-launched cruise missiles at air bases for their bombers; those weapons were not on the aircraft and thus not “deployed.”

On March 6, 2003, 48 Republican senators voted to consent to ratify SORT, which won approval by a tally of 95-0.

Given how SORT sailed through the Senate, the Obama administration in 2010 expected the New START Treaty to receive easy approval as well. After all, the treaties imposed similar limits on deployed strategic warheads. New START specified a limit of 1,550, but it treated each bomber as only one deployed warhead (bombers can carry more). The United States and Russia each likely have 200-300 additional weapons to put on their bombers, so New START’s 1,550 limit amounts to about 1,800 or so total weapons, equivalent to SORT’s 1,700-2,200. In contrast to SORT, the sides use agreed counting rules under New START, so they count the same things. Moreover, New START has substantial monitoring provisions and is verifiable.

What happened to New START in the Senate? It faced a tortuous ratification debate: myriad claims of alleged flaws and weaknesses, 1,000 questions for the record, and several efforts to delay a vote. On December 22, 2010, the Senate finally approved New START by a count of 71-26. Seventy-one votes meant four more than needed, but it was a far cry from the 95 votes that approved SORT.

The 26 senators who voted against New START in 2010 were all Republicans. Sixteen of them held seats in the Senate in 2003; 15 voted to approve SORT while one abstained. Moreover, three other Republican senators who voted to approve SORT chose to abstain on New START.

So 18 Republican senators who voted “yea” on SORT in 2003 just seven years later found New START—a verifiable treaty with agreed counting rules and a warhead limit comparable to SORT—an unacceptable risk to U.S. national security. One can be forgiven for thinking that factors other than New START’s merits and the national interest figured in their votes. Indeed, one senator attributed his “nay” vote against New START to unhappiness with the Obama administration’s decision to do away with the military’s “don’t ask/don’t tell” policy.

It thus should come as little surprise that the Obama administration thinks about arrangements other than a treaty. And the administration need only look back to its predecessor for a ready model: the Bush administration’s original proposal in 2001 that Mr. Bush and Mr. Putin simply make parallel statements of the number of strategic warheads that each country would deploy.

Say that Mr. Obama and Mr. Putin now agree that they could reduce the number of each country’s deployed strategic warheads from New START’s limit of 1,550 to 1,000 (still well more than enough to devastate the other). The two presidents could announce, perhaps in a joint statement, that each had decided as a matter of national policy to limit his country’s strategic forces to no more than 1,000 deployed strategic warheads.

The 1,000 limit would be politically binding, while the 1,550 limit would remain a legally binding constraint. U.S. and Russian officials could use the detailed monitoring provisions of New START to verify compliance with both limits.

This would be a relatively fast and simple way to achieve further nuclear reductions—not requiring a new treaty, not requiring a treaty amendment, and not requiring a vote in the Senate.

To be clear, the preferable way for such an arms control agreement would be a legally binding treaty, ideally one that limited all U.S. and Russia nuclear weapons, not just deployed strategic warheads. But a treaty is not the only option the Obama administration has. Nor, given attitudes of some in the Republican Senate ranks, is it the only option the administration should consider.

Authors

Steven Pifer

Presidents, Nuclear Reductions and the Senate

Steven Pifer — Thu, 14 Mar 2013 12:32:00 -0400

President Barack Obama desires to further reduce nuclear arsenals below the levels set in the 2010 New Strategic Arms Reduction Treaty (New START). Republicans on Capitol Hill and former officials of the George W. Bush administration assert that he can reduce U.S. nuclear forces only as the result of another treaty, requiring approval by a two-thirds majority in the Senate. In fact, over the past 40 years, there is plenty of precedent—set by Republican presidents—to the contrary.

Why this matters has to do with how Mr. Obama might codify a new arms reductions arrangement with Russia. If Moscow is prepared to engage, still an open question, the Obama administration appears to want options in addition to a treaty. Why? Fear that Senate Republicans would set an impossibly high bar for any new Obama treaty, a worry fueled by the unexpectedly partisan and bitter ratification fight over New START.

For more than 40 years, U.S. presidents reduced nuclear weapons and recorded limits—or sought to do so—in ways that did not require Senate consent to ratification, starting with Richard Nixon. Mr. Nixon in May 1972 signed the interim offensive arms agreement on strategic weapons. It froze the numbers of launchers of U.S. and Soviet intercontinental ballistic missiles (ICBMs) and submarine-launched ballistic missiles (SLBMs) at levels giving the Soviets significantly larger numbers. Mr. Nixon chose to submit this as an agreement requiring a simple majority vote by both houses of Congress rather than as a treaty requiring two-thirds majority approval in the Senate.

Some 20 years later, President George H. W. Bush made deep unilateral cuts in the U.S. nuclear arsenal. In September 1991, he announced what became known as the “presidential nuclear initiatives.” These included the elimination of all U.S. nuclear artillery shells and warheads for short-range ballistic missiles, as well as the removal of all tactical nuclear weapons from U.S. Navy warships, many of which would be destroyed. Mr. Bush said that he had consulted with his senior advisors and the Joint Chiefs of Staff. He made no mention of the Senate or Congress—and appears not to have consulted with them before announcing a second set of nuclear initiatives in January 1992.

As a result of the presidential nuclear initiatives, the United States unilaterally eliminated thousands of tactical nuclear weapons from its arsenal. According to Department of Defense figures, the overall U.S. nuclear stockpile fell from more than 23,000 weapons to less than 13,000 during the Bush presidency. Only some of those reductions resulted from treaties approved by the Senate.

Ten years later, in November 2001, President George W. Bush announced that, as a result of his administration’s nuclear posture review, the U.S. military would maintain 1,700-2,200 “operationally deployed strategic nuclear warheads.” When President Vladimir Putin asked for a new arms control treaty with limits below the levels of the 1991 START I Treaty (it allowed each side 6,000 warheads), the Bush administration came up with a novel approach: Mr. Bush would state publicly that the United States would maintain no more than 1,700-2,200 operationally deployed strategic nuclear warheads, and Mr. Putin would state that Russia would maintain X. It would be up to Moscow to fill in the X at whatever level the Russians chose; the Bush White House did not care. These would be parallel statements of national policy, not a treaty subject to approval by the Senate.

This approach held little appeal for the Russians. In the end, Mr. Bush, grateful for Russian support in the aftermath of the 9/11 attacks, agreed to Mr. Putin’s direct plea for a treaty. They signed the Strategic Offensive Reductions Treaty (SORT) in May 2002, a two-page agreement that limited the United States and Russia each to no more than 1,700-2,200 “strategic nuclear warheads,” though it failed to define “strategic nuclear warhead” or anything else and had no monitoring provisions. The treaty was unverifiable.

There are good reasons to consider codifying further nuclear reductions in a treaty, particularly a treaty with agreed definitions and verification provisions. But Mr. Obama has other options, as his Republican predecessors have demonstrated. Tomorrow’s blog—“SORT vs New START: Why the Administration is Leery of a Treaty”—will address why the administration might choose an option other than a legally binding treaty.

Authors

Steven Pifer

Droning on: Thoughts on the Rand Paul “Talking Filibuster”

Sarah A. Binder — Thu, 07 Mar 2013 00:00:00 -0500

Sen. Rand Paul has just completed his nearly thirteen hour filibuster against John Brennan's nomination to head the CIA. Breaking off his filibuster (because, he inferred, he had to pee), Rand was heralded for bringing back the "talking filibuster." There was much written (and tweeted) about his filibuster, which began with Paul’s dramatic:

"I will speak until I can no longer speak…I will speak as long as it takes, until the alarm is sounded from coast to coast that our Constitution is important, that your rights to trial by jury are precious, that no American should be killed by a drone on American soil without first being charged with a crime, without first being found to be guilty by a court."

I thought I would add a few late-night thoughts in honor of this day spent with C-Span 2 humming in my ear.

First, I think Jon Bernstein’s reaction to the filibuster was right on the mark. There’s been a lot of enthusiasm for the talking filibuster today, from Ezra Klein's "If more filibusters went like this, there’d be no reason to demand reform," to Josh Marshall’s, "This is a good example of why we should have the talking filibuster and just the talking filibuster." But Bernstein raises a critical point: "Today’s live filibuster shows again just how easy it is to hold the Senate floor for an extended period." The motivation of recent reformers has been to reduce filibustering by raising the costs of obstruction for the minority. In theory, making the filibuster more burdensome to the minority—while putting their views under the spotlight—should make filibusters more costly and more rare. (Paul did note in coming off the Senate floor tonight that his feet hurt…) But as Bernstein points out, Paul believes in his cause, and it plays well with his constituencies. On the physical front, the tag-team of GOP senators rallying to Paul's cause also lessened the burden on Paul (as would have a pair of filibuster-proof shoes). That said, today's filibuster was a little unusual. The majority seemed unfazed by giving up the day to Paul’s filibuster, perhaps because the rest of Washington was shutdown for a pseudo-snow storm. Moreover, the Brennan nomination had bipartisan support, with Reid believing there were 60 senators ready to invoke cloture. In short, today's episode might not be a great test case for observing the potential consequences of reform.

Second, keep in mind that this was a double-filibuster day. The nomination of Caitlin Halligan for the DC Court of Appeals was blocked, failing for the second time to secure cloture. With 41 Republican senators voting to block an up or down confirmation vote on Halligan, an often-noted alternative reform (which would require 41 senators to block cloture instead of 60 senators to invoke it) would have made no difference to the outcome. And what if the minority had been required to launch a talking filibuster to block Halligan’s nomination? Reid might have been willing to forfeit the floor time to Paul today. But Reid would unlikely have wanted to give up another day to Halligan’s opponents. As Steve Smith has argued, the burden of talking filibusters also falls on the majority, which typically wants to move on to other business. "Negotiating around the filibuster," Smith has argued, "would still be common." On a day with two successful minority filibusters (at least in consuming floor time and deterring the majority from its agenda), we can see why the majority might be reticent to make senators talk.

Third, let's not lose sight of the target of Rand's filibuster: The head of the CIA. Although the chief spook is not technically in the president’s cabinet, the position certainly falls within the ranks of nominations that have typically been protected from filibusters. Granted, that norm was trampled with the Hagel filibuster for Secretary of Defense. But rather than seeing the potential upside of today's talking filibuster, I can't help but see the downside: In an age of intense policy and political differences between the parties, no corner of Senate business is immune to filibusters.

All that said, what's not to like about a mini demonstration of a real live filibuster?! Perhaps Paul's late day Snickers break was cheating. But it was a good C-Span type of day overall, for filibuster newbies to Franklin Burdette devotees. Even Dick Durbin well after midnight seemed to be enjoying the fray. Perhaps there’s a silver lining for talking filibusters after all.

Authors

Sarah A. Binder

Publication: The Monkey Cage

As 'Devastating' as Sequester is, not 'Immediate Catastrophe'

Thomas E. Mann — Sun, 03 Mar 2013 00:00:00 -0500

Editor's Note: In an interview with NPR Host Rachel Martin, Thomas Mann speaks about the economic and political impact of sequestration. He is the co-author of a book about political gridlock, called It's Even Worse Than It Looks.

RACHEL MARTIN, HOST: So, the satirical news site the Onion ran a headline this past week, and it read as follows: Obama, Congress must reach deal on budget by March 1st, and then April 1st and then April 20th and then April 28th and then May 1st and then twice a week for the next four years. Now, the Onion headline is fake, yes, those deadlines are not real, but it can be hard to tell, considering the current political climate in Washington.

Thomas Mann has followed Congress for a long time. He's a congressional scholar at the Brookings Institution here in Washington, and he says the careening from fiscal crisis to fiscal crisis has taken a toll.

THOMAS MANN: It's really quite devastating. We've come through the worst financial economic crisis since the Great Depression in reasonably good shape. But in the course of setting up these artificial crises and insisting on immediate cuts, we've actually slowed the rate of growth. We've made job creation all the more difficult and, in general, embarrassed ourselves in front of the rest of the world.

MARTIN: Interesting though, Wall Street seems to have adapted to this "new normal." quote, unquote. But is this a good thing that Wall Street has adapted, or not a good thing?

MANN: That's a good question. Wall Street and, frankly, the bond market are responding to the fundamentals of our economy and the U.S. relative to the rest of the world. More immediately, the sequester itself is not seen as capable of disrupting the macroeconomy. The damage it does is uneven across the country and to individual Americans. It will roll out slowly over time and it will hurt us on the longer-term quest to make the kind of investments and changes we need to thrive over the long haul. But it's just not an immediate catastrophe for the overall economy.

Listen to the full interview at npr.org »

Authors

Thomas E. Mann

Publication: NPR

Are the Days of the Hastert Rule Numbered? Some Caution in Reading the House

Sarah A. Binder — Fri, 01 Mar 2013 00:00:00 -0500

Most Congress watchers yesterday quickly noted the remarkable House vote to pass the Violence Against Women Act (VAWA): For the third time this year, the House passed an important bill over the objections of a majority of the majority party. Another "Hastert Rule violation," many reporters correctly observed. (Is it a good sign that House procedural speak is now lingua franca of the Capitol press corps? Next thing you know, Hollywood will be making Oscar-winning films about the 19th century House….Oh wait….)

Observers noted that the leadership brought the VAWA bill to the floor (knowing the GOP majority would be rolled on final passage) as a calculated move to repair damage done to the party'sbrand name in the last election. As the Los Angeles Times reported, many GOP strategists "feared that keeping the bill in limbo could expose the party to complaints they were hostile to women."

I think the coverage of the VAWA bill has been right on the mark. Still, we should be cautious in writing the Hastert Rule's obituary. Some considerations:

First, as many reporters noted, the substance of the yesterday's bill mattered. Concern about the party's electoral reputation likely helped to encourage the GOP to bring the bill to the floor (on a nearly unanimous procedural vote). We see some evidence of that concern in the makeup of the sixty Republicans who broke ranks to vote against the conservatives' alternative bill: Roughly sixty percent of them hailed from blue states won by Obama in 2012. (Note: GOP women were more likely to stick with their conservative brethren on that substitute vote, with roughly 80 percent of the GOP women favoring the more limited bill.) Moreover, on final passage, nearly three-quarters of the Republicans who voted with the Democrats hailed from blue states. I think it's reasonable to expect that on other electorally-salient bills this Congress we might see the leadership allow party splitting measures on the floor, letting the chamber median work its will in favor of passage. As many others have noted, immigration reform could provide another such opportunity. In short, the terrain for future Hastert rule violations might be quite limited.

Second, keep in mind that all three of the Hastert Rule violations occurred on legislative measures already cleared by the Senate. Mitch McConnell and Joe Biden negotiated the fiscal cliff bill that was passed 89-8 with broad bipartisan support. Hurricane Sandy relief was first cleared by the Senate on a (narrower) bipartisan vote. And the Senate had also already endorsed the more expansive version of the VAWA bill, with a majority of Senate GOP joining every Democrat in voting for the bill. The support of Republican senators (albeit to varying degrees) for Democratic measures makes it far harder for the Speaker to stick with his conservative conference majority. Instead, he offers them a vote to establish their conservative bona fides and then allows the Democrats to win the day. Split party control seems to limit the viability of the Hastert Rule, at least on those few measures on which Senate Democrats can attract GOP support to prevent a filibuster. Ironically, the new Boehner Rule of "Make the Senate Go First" (insert saltier language for full effect) undermines the Hastert Rule. Given the difficulty Boehner faces in assembling a chamber majority without Democratic votes on bigger issues of the day, perhaps we shouldn’t be surprised to see this periodic scuttling of the majority of Boehner’s majority.

Finally, yesterday's vote helps us to better identify the far right flank of the House GOP. Here, I consider the far right of the conference those Republicans who voted against waiving the debt limit for three months, against Hurricane Sandy relief, and against the VAWA bill. That group sums to 26 GOP. Given 232 House Republicans, Boehner can't bring party-favored bills to the floor without moving exceedingly far to the right. That's helps to explain why Boehner insists on letting the Senate go first on issues that evoke tough dissent within his party. He has no choice, even if that sets him up for potential majority rolls on important roll call votes. Ultimately, the fate of the Hastert Rule depends on how the Speaker balances his support within the conference with the responsibility of tending to the party's brand name (let alone to the will of the chamber).

Authors

Sarah A. Binder

Publication: The Monkey Cage