The vote to proceed to Estate Tax Repeal failed 57-41 falling short of the 60 votes required to even CONSIDER the legislation. Many members of the Senate have talked about how they are for reform but not repeal but today’s vote showed this was just a red herring. You can not reform the estate tax if you vote against considering the legislation which is the vehicle to implement that reform. As such, a vote against considering the estate tax legislation today is an endorsement of the pre-2001 rates of 55 percent with a $1 million exemption, which go into effect in 2011.

Interestingly, Evan Bayh, Mary Landrieu, and Ron Wyden voted for full repeal in 2002. Today, they voted against even considering the legislation for some type of reform. Hence they went from supporting a 0 percent estate tax to a 55 percent rate. That’s because this is not whether you support or oppose estate tax repeal. The Dems have actively traded votes to let their vulnerable members up for reelection support the legislation and have other members not up for reelection vote against the legislation, even if they support estate tax repeal/reform. This ensures incumbent protection while also ensuring 60 votes can never be reached.

As an example, Sen. John Breaux, the prime sponsor of the legislation for repeal, voted no in 2002 so Mary Landrieu can vote yes.

These three flip-floppers made the difference between 57 votes and 60 votes. Also Tim Johnson has not learned his lesson from the 2004 race in his home state where Tom Daschle, then sitting Minority Leader, was ousted in which this issue was used. How about Ken Salazar from Colorado whose campaign focused on a major reform due to the agriculture issues in their state?

But last and certainly not least is Mark Pryor from Arkansas who constantly speaks about the harmful effects of the estate tax. Well he was a no as well.

It is one thing to vote no on the legislation – but it’s a totally different ball game when you vote to ensure that the Senate cannot even CONSIDER legislation these Senators promised to their constituents in the past.

True to form Harry Reid held his caucus tightly together and we won’t know the impact until after the fall elections.

Donald Luskin, chief investment officer of Trend Macrolytics, says investors shouldn't invest based on hurricane activity. "I would put it in a category of exogenous risks that you really can't do anything about."

...he was fired in as insulting a fashion as possible, including snide remarks about his personal appearance. (White House aides made a point of telling reporters that Mr. Bush complained about Mr. Lindsey's failure to exercise.)

:...imagine our surprise when Special Prosecutor Patrick Fitzgerald declared his intention last month to use that editorial as part of his perjury and obstruction case against former Vice Presidential aide Scooter Libby, who had also questioned Mr. Wilson's claims. It suggests that his case is a lot weaker than his media spin.

Mr. Libby wasn't a source for our editorial, which quoted from the October 2002 National Intelligence Estimate concerning the Africa-uranium issue. But Mr. Fitzgerald alleges in a court filing that Mr. Libby played a role in our getting the information, which in turn shows that "notwithstanding other pressing government business, [Libby] was heavily focused on shaping media coverage of the controversy concerning Iraqi efforts to obtain uranium from Niger."

The prosecutor comes close here to suggesting that senior government officials have no right to fight back against critics who make false allegations. To the extent our editorial is germane to this trial, in fact, it's because it puts Mr. Libby's actions into a broadly defensible context that Mr. Fitzgerald refuses to acknowledge.

The government would decide how many gallons of gasoline should be consumed per year...

COMPLAINTS about the May 23 Page 1 article on Hillary and Bill Clinton add up to one of the most uniformly negative and partisan reader reactions to a Times article during the past year. Most decried as tabloid journalism the story about the couple and the political implications of their marriage for her Senate re-election campaign and presidential aspirations.

the movement known as "9/11 Truth," a society of skeptics and scientists who believe the government was complicit in the terrorist attacks. In colleges and chat rooms on the Internet, this band of disbelievers has been trying for years to prove that 9/11 was an inside job.

Update... Our DC lawyer/lobbyist friend (who always asks for anonymity) contributes this thought.

I finally figured out the motivation of the New York Times: it serves to feed stimuli to the anxiety-addicts of the left. If things were said to be good, or getting better, this key demographic might die instantly. Oh, how could things be getting better, since they are not in charge.

Not so long ago, one of their kind was briefly in charge, or thought he was. This speech defined him well. I'm talking about Jimmy Carter, and his famous "malaise speech."

He lost his reelection by the then-biggest margin ever.

Keep a copy handy for easy reference. You'll note a few similarities in Hillary's energy policy, most notably the billion-dollar federal "bank" to "invest" in energy. Golly, wonder how that'll turn out.

One of the disadvantages of having a public Social Security system is that people are free to make all sorts of untrue statements about it without facing any consequences. For example, an oped [sic] in the Washington Post this morning described the Social Security trust fund as “largely an accounting fiction.” This statement is of course absurd. The trust fund consists of U.S. government bonds, which the government is obligated to repay under the law. There is no sense whatsoever in which it can accurately be described as fictional. [emphasis added]

Because Social Security is an agency of the government, the author is free to impugn the soundness of Social Security's financial situation with impunity, and the Post need not fear any consequences from printing this libel. On the other hand, if the author had made similarly untrue claims about the financial status of General Electric or Microsoft, the paper would be quickly greeted with an angry call from some honcho corporate lawyer. [emphasis added]

The Left's normal strategy is to characterize as a "lie" any interpretation of economic situations that differs from their own preferred one -- now Baker has upped the ante, and suggests a new characterization: "libel." In this case (as in most), there is (at the very least) a great deal of room for difference of opinion about the situation being interpreted. For example, this excellent paper by Wharton economist Kent Smetters presents numerous credible rationales for considering the Trust Fund real and fictional. Whichever side you come down on, to regard the Trust Fund as a fiction is neither lie nor libel. It is legitimate opinion.

I happen to believe that Baker's opinion on this is dead wrong. It hinges on the fact that the Trust Fund holds government bonds. Indeed it does. But that is a legal fact, not an economic one. The duty to pay promised Social Security benefits is an obligation of government, and the duty to pay off the bonds at maturity is, too. A single obligated party cannot legitimately fund one of his  obligations with another of his obligations. To use Baker's analogy of General Electric, that company could not fund its own pension obligations by having its pension fund hold General Electric bonds. As the Congressional Budget Office puts it,

The trust funds serve mainly as an accounting mechanism to track revenues and outlays for Social Security. The funds' balance represents the total amount that the government is legally authorized to spend on Social Security. That balance provides only a limited perspective on the program's finances, however, because it does not consider the interaction with other federal tax and spending programs. Although the Social Security system is authorized to spend certain amounts, the resources to finance those outlays derive from the budget as a whole--and ultimately from the economy.

...positive trust fund balances indicate the legal authority to pay benefits but not the budgetary resources to do so.

...repeal [of the estate tax] would cost the U.S. Treasury $1 trillion in its first ten years. That's about equivalent to what's needed to save Social Security over the next 75 years.

Mankiw suspects that Reich got this from a report of the Center on Budget Policies and Priorities. Now Paul Krugman makes his own version of the same howler in a New York Times column this morning. As Mankiw continues his new career as a blogger, he'll quickly realize that liberal columnists like Reich and Krugman never create their own economic content. They feed on economic talking points provided by think tanks cum lobbyists like CBPP -- accepting them uncritically and adding their own particular gloss of literary style.

Update... Irony... In another Mankiw blog post, he cites a Congressional Budget Office study to show that repeal of the estate tax would have almost no negative impact on charitable giving. Here's the headline from CBPP's take on the same CBO report:

NEW CBO STUDY FINDS THAT ESTATE TAX REPEAL
WOULD SUBSTANTIALLY REDUCE CHARITABLE GIVING