Opinion: To save the economy from COVID-19, the only effective policy is medical, not monetary or fiscal

The priority should be detection, containment, and treatment, not tax cuts and lower interest rates

March 10, 2020 By Barry Eichengreen

A patient is screened for coronavirus on Monday at the CHU Pellegrin in Bordeaux, southwestern France. AFP via Getty Images 

PICTURE FROM FRANCE BECAUSE THIS IS NOT HAPPENING IN AMERICA

BERKELEY, Calif. (Project Syndicate) — Last week, G-7 finance ministers and central bank governors vowed to use “all appropriate policy tools” to contain the economic threat posed by the COVID-19 coronavirus. The question left unanswered is what is appropriate, and what will work.

The immediate response took the form of central bank rate cuts, with the Federal Reserve fast off the mark. Though central banks can move quickly, however, it is not clear how much they can do, given that interest rates TMUBMUSD10Y, 0.703% are already at rock-bottom levels. In any case, the Fed’s failure to coordinate its rate cut with other major central banks sent a negative signal about the coherence of the response.

Moreover, monetary policy can’t mend broken supply chains. My colleague Brad DeLong has tried to convince me that an injection of central bank liquidity can help get global container traffic moving again, as it did in 2008. (Now you know the kind of elevator conversations we have at UC Berkeley.) But the problem in 2008 was disruptions to the flow of finance, which central banks’ liquidity injections could repair.

The problem today, however, is a sudden stop in production, which monetary policy can do little to offset. Fed Chair Jerome Powell can’t reopen factories shuttered by quarantine, whatever President Donald Trump may think. Likewise, monetary policy will not get shoppers back to the malls or travelers back onto airplanes, insofar as their concerns center on safety, not cost.

Rate cuts can’t hurt, given that inflation, already subdued, is headed downward; but not much real economic stimulus should be expected of them.

The same is true, unfortunately, of fiscal policy. Tax credits won’t get production restarted when firms are preoccupied by their workers’ health and the risk of spreading disease. Payroll-tax cuts won’t boost discretionary spending when consumers are worried about the safety of their favorite fast-food chain.

The priority therefore should be detection, containment, and treatment. These tasks require fiscal resources, but their success will hinge more importantly on administrative competence. Restoring public confidence requires transparency and accuracy in reporting infections and fatalities. It requires giving public health authorities the kind of autonomy enjoyed by independent central banks. (Unfortunately, this is not something that comes naturally to leaders like Trump.)

Still, expansionary fiscal policy, like expansionary monetary policy, can’t hurt.

Here, Italy has shown the way, postponing tax and mortgage payments, extending tax credits to small firms, and ramping up other spending. The U.S. so far has shown less readiness to act, failing even to encourage people to seek testing by helping them pay their medical bills.

One obstacle to fiscal stimulus is that its effects leak abroad, because some of the additional spending is on imports. As a result, each fiscal authority hesitates to move, and governments collectively provide less stimulus than is needed. This justifies coordinating fiscal initiatives, as G-20 countries did in 2009. But, by that year’s standards, the recent G-7 communiqué promising “all appropriate action” was a nothingburger that did little to bolster confidence that governments would take the concerted steps called for by worsening global conditions.

Then there are fiscal hawks and monetary-policy scolds who claim that any official intervention will be counterproductive. They warn, for example, that financial systems will be impaired if central banks push interest rates deeper into negative territory. But while there surely exists an interest rate sufficiently below zero where this is the case, all the evidence is that current rates are still very far from this point.

In addition, we are cautioned that fiscal stimulus by governments with heavy debts will undermine confidence, rather than bolster it. Japan, it is said, is already dangerously over-indebted. This exaggerated argument ignores the fact that the Japanese government has extensive public-sector assets to offset against its debts.

Likewise, we are reminded that the U.S. has a looming entitlement burden, an argument that ignores the fact that the interest rate on the public debt is perennially below the economy’s growth rate. And while China’s state-owned enterprises may have massive debts, the tightly controlled financial system limits the risk of the kind of financial crisis that the country’s critics have been erroneously forecasting for years.

Central banks and political leaders, faced with a global crisis, should ignore these fallacious arguments and use monetary and fiscal policies to ensure market liquidity, support small firms, and encourage spending. But they must recognize that these textbook responses will have only limited effects when the problem is not a shortage of liquidity, but rather supply-chain disruptions and a contagion of fear.

Today, economic stabilization depends most importantly on the actions of public-health authorities, who should be given the resources and leeway to do their jobs, including freedom to cooperate with their foreign counterparts.

In the fight against the COVID-19 pandemic, economists, economic policy makers, and bodies like the G-7 should humbly acknowledge that “all appropriate tools” imply, above all, those wielded by medical practitioners and epidemiologists. Coordination, autonomy, and transparency must be the watchwords.

Barry Eichengreen is professor of economics at the University of California, Berkeley, and a former senior policy adviser at the International Monetary Fund. His latest book is “The Populist Temptation: Economic Grievance and Political Reaction in the Modern Era.”

Republican mayor and former Trump voter explains why he’s about to cast his first-ever vote for a Democrat
“I remember thinking this Trump thing is insane, I slowly talked myself into it. ‘He can’t seriously be this deranged once he gets in there,’ and he’s even more deranged now than I thought then. So, I take the blame.”

March 10, 2020 By Shawn Langlois

Democratic presidential candidate Joe Biden speaking in Detroit. Getty

‘How could I look at those three kids and tell them I’m proud to support Donald Trump? I can’t. I won’t.’

That’s Michael Taylor, mayor of Sterling Heights, Mich., pointing to his family in a tweet this week as reasons why he was preparing to cast his first-ever vote for a Democrat.

“I think Joe Biden is the candidate who can unify all of the Democrats,” Taylor, a Republican son of Republican parents, told the Chicago Tribune. “He’s the candidate who can appeal to moderates and Republicans like me who don’t want to see four more years of President Trump.”

His comments came before voters headed to the polls on Tuesday in Michigan, as well as in Idaho, Mississippi, Missouri, North Dakota and Washington. Biden currently has 664 delegates to Bernie Sanders’s 573, according to a tracker by the Wall Street Journal. It takes 1,991 to win the nomination on the first ballot at this summer’s Democratic convention.

Taylor, until now, has proven to be a devoted conservative. According to the Tribune, he tangled with liberal students in high school as the author of a right-leaning column for his campus. He later became a member of the Tea Party and ultimately cast his vote for Donald Trump in 2016.

“I think what you saw in 2016 was people saying, ‘We’re sick of these places on the coasts, New York, Los Angeles and Washington, D.C. ... dictating to us what’s going to happen,” he explained. “We’ve got some political power, we’ve got some political might and we’re going to flex it,.”

Taylor, now 36, took office in 2014 at the age of 31, replacing South Bend, Ind., Mayor Pete Buttigieg as the youngest mayor of a city with more than 100,000 people. He recalled to the Tribune why Trump earned his vote the first time around.

“I remember thinking this Trump thing is insane, but when it was down to him and Hillary, I kind of said, ‘Well, you are a Republican, and yeah he’s nuts, but maybe he’ll get better and you know he’s going to lower taxes,” he said. “I slowly talked myself into it. ‘He can’t seriously be this deranged once he gets in there,’ and he’s even more deranged now than I thought then. So, I take the blame.”

This controversial energy stance splits top Democrats — and likely the country
Shale-rich Pennsylvania, with its fracking and its unions, reprising its role as a key election swing state
March 10, 2020 By Rachel Koning Beals
Workers with Cabot Oil and Gas work at a hydraulic fracturing site in South Montrose, Pa. The extraction method, also known as fracking, injects wells with high volumes of chemical-laced water in order to free up pockets of natural gas. Getty Images

The debate over fracking in 2020 battleground state Pennsylvania divides the last major Democrats vying for the party’s backing for president — a policy distinction that has wider implications as the U.S. tightens its clasp on energy independence against heavyweights Saudi Arabia and Russia.

Former Vice President Joe Biden and Sen. Bernie Sanders of Vermont will emphasize energy-policy differences in coming weeks; Pennsylvania’s Democratic primary is set for April 28. Their pro-fracking rival on the Republican side, President Donald Trump, has been clear in his push to keep fossil fuels, especially domestic production, in the energy mix. Trump won Pennsylvania during his unexpected march to the White House four years ago, which made him the first Republican presidential candidate to carry the commonwealth since 1988.

Pennsylvania’s election role is significant certainly for the vote tally alone. But its energy-pegged economy and mix of rural and urban demographics positions the commonwealth as a test for nationwide sentiment on traditional fossil fuels. That includes relatively cleaner and cheaper natural gas, which increasingly powers electric utilities. Fracking has, in a few short years, lifted Pennsylvania to the No. 2 ranking among U.S. natural-gas producers, behind only Texas.

Biden’s energy and climate-change plan includes a ban on Arctic oil drilling, while boosting regulations on fracking, but stops short of banning the practice. When a voter in Iowa said the country should stop building pipelines and drilling, Biden, a Pennsylvania native, responded: “You have to go vote for somebody else.”

Sanders has called for a national fracking moratorium and made a plug for the aggressive and comprehensive Green New Deal framework. It’s that plan, or a variation thereon, that Sanders believes can help move oil- and coal-industry workers into higher-paying green infrastructure jobs. For sure, calls for banning fracking are widening the fault lines between Pennsylvania’s Democrats and their traditional allies in organized labor, many of whose members work in the energy industries.

“I’m not sure how anybody in their right mind thinks they might win Pennsylvania on a fracking ban,” said Frank Maisano, senior principal at Policy Resolution Group, who has a focus on energy issues. “There is a small, but vocal, group of activists [against the practice], but then there are unions, small business and just about everybody else that benefits from a shale-drilling economy.”

Maisano said, for instance, that endangered rural hospitals in some parts of the state are beneficiaries of natural-gas-linked funding. The energy sector in Pennsylvania adds $45 billion to the commonwealth’s economy and has contributed more than 300,000 jobs, according to the U.S. Chamber of Commerce.

The rise of natural gas also gives new life to the accompanying debate on methane leaks during natural-gas extraction, especially their contribution to raising average global temperatures. Hydraulic fracturing uses high-pressure, chemical-laced liquid to extract oil, and secondarily, gas, at shale sites. The process increases seismic-activity risk, water contamination and other factors, say fracking’s critics.

The fracking issue currently plays out against extreme energy-market volatility. Saudi Arabia and Russia — two of the biggest U.S. energy rivals, with geopolitical strings attached — are dancing around a global price war. This uncertainty dealt the oil market its biggest one-day price drop since 1991. The tension is fueled by the U.S.’s rise to energy independence, in part because of its shale bounty. The Trump administration on Tuesday was seen as likely to push federal aid for shale companies hit by the international energy shock and the coronavirus outbreak, the Washington Post reported.

Along with new horizontal drilling techniques, fracking has unlocked new volumes of natural gas and oil from shale deposits in the U.S. over just the past decade-plus. That helped turn the U.S. from the world’s biggest oil importer into the world’s biggest oil and gas producer, which some energy analysts stress gives the U.S. an edge in curbing greenhouse-gas emissions by earning a bigger say on the international energy-policy stage.

“Up to recently, before the U.S. shale-gas revolution, Russia was the country which was dominating, alone, the gas markets,” Fatih Birol, executive director of the International Energy Agency, said in a CNBC interview last year. “With the U.S. coming into the picture, there is a choice, there are options for the consumers, better for energy security, for diversification.”

At what cost
The methane that is emitted from the process has 86 times the global-warming potential of carbon dioxide over a 20-year period, according to the Union of Concerned Scientists. It is the main component of natural gas, and, when companies drill for oil, they generally also get natural gas. Methane is released in the atmosphere during the extraction and distribution of natural gas, and, while many scientists agree this is a major problem, there is little data to show exactly how much is leaking into the atmosphere.

With shale in their back yards, Pennsylvania voters remain divided, according to a statewide Morning Call/Muhlenberg College poll. It found 42% of Pennsylvanians oppose a ban on fracking and 38% support a moratorium, with 20% undecided.

A poll from the same source taken in late February, before Sen. Elizabeth Warren of Massachusetts had withdrawn from the presidential race, showed Trump doing better against potential Democratic rivals than he did in a similar poll three months earlier, especially in potential matchups with Biden and Warren. Sanders maintained a slight lead over the president in hypothetical matchups at that time.

In the Philadelphia suburbs that have been trending Democratic, some voters have shown a growing opposition to the drilling and massive pipelines (sometimes right through their neighborhoods) required to move fracked material to refineries, the Associated Press has reported.

Chester and Delaware counties in the Philadelphia suburbs, for example, have more than 750,000 voters, which is roughly 9% of the voters in Pennsylvania. The two counties sit between the shale-gas fields on the western side of the state and the industrial hub of Philadelphia. To connect the two, companies are cutting through lawns and near schools to lay pipelines, E&E EnergyWire has reported. Trump won the state by fewer than 45,000 votes in 2016.

Republican U.S. Sen. Pat Toomey of Pennsylvania has framed a fracking ban as a tough choice for Americans between affordable energy and unaffordable energy. Pennsylvania’s top Democrats, including Gov. Tom Wolf and U.S. Sen. Bob Casey, have tried to discourage talk of a fracking ban, while labor leaders point to thousands of building-trades members working on gas drilling sites, laying billions of dollars in pipelines and building massive refineries, the Associated Press has reported.

”The shale revolution started in Texas, but the oil patch is no longer just Texas and Oklahoma. The Mid-Atlantic [region] and the upper Plains are producers, too, and the entire country is benefiting,” said Martin Durbin, president of the Chamber of Commerce’s Global Energy Institute.

“Now that natural gas is the largest source of electricity ... and fracking has lowered its cost, that’s what has given us the ability to lower carbon emissions [over coal use and other traditional fossil fuels],” Durbin said.

Age and other demographics, more so than party, may sway the energy vote. In November, the Pew Research Center released a national poll showing that rising percentages of millennial Republicans believe the federal government is not doing enough on climate. Other surveys have found similar trends.

Many politicians consider natural gas, even with the methane problem, a transitional fuel that helps the U.S. move away from heavier fossil fuels. But the natural-gas bridge to a carbon-free future must have a clear end date, say environmental advocates.

“It’s kind of a weird environment.”

Two epidemics combine to make for a ‘dangerous time for the stock market,’ Nobel Prize–winning economist warns

March 10, 2020 By Shawn Langlois

Robert J. Shiller, Nobel laureate for Economic Sciences AFP/Getty Images

‘What we have now is really two epidemics. We have an epidemic of the coronavirus, but we also have an epidemic of fear based around a narrative that is not necessarily keeping up with scientific reality. And, this narrative has been quite striking. It’s a dangerous time for the stock market.’

That’s Robert Shiller, Yale professor and Nobel Prize winner, explaining to CNBC during Monday’s market plunge why he believes there’s more selling to come. “This disease is contagious even before it shows obvious symptoms,” he said. “So, it’s going to be harder to quarantine people in this epidemic. That’s the narrative, and we haven’t gotten very far into it yet.”

According to the latest tally from Johns Hopkins, there are now 116,146 cases of COVID-19, with at least 4,088 deaths. In the U.S., there are 761 cases and 27 deaths.


“The potential for market disruption because of a scary narrative is quite high,” Shiller warned. “It’s highly likely now that we’ll have a recession. It’s already disrupting business. It’s already causing people to pull back. We’re not going to see creative new investments blossom in this environment.”

The stock market on Tuesday again reflected the uncertainty and volatility facing investors, with the Dow Jones Industrial Average DJIA, +4.89% giving back a chunk of its early gains by midday.

“We’ll see how well the measures to reduce the coronavirus epidemic play out. But I wouldn’t put too much hope in that,” Shiller said. “It’s a dangerous epidemic and the epidemic of fear that accompanies it is dangerous also.”

This chart of the stock market’s ‘fear’ index in 2020 illustrates how unhinged markets have been over coronavirus compared to the 2008 crisis

March 10, 2020 By Mark DeCambre

The Cboe VIX boasted a nearly 300% year-to-date return at its peak on Tuesday

MarketWatch photo illustration/iStockphoto


How volatile and anxious is Wall Street amid this evolving worry about a potential global pandemic that could shake the global economy to its core?

Perhaps, the best gauge of that deep-rooted concern is one of the market’s most closely watched measures of volatility.

The Cboe Volatility Index VIX, -13.14%, or VIX, hit its highest intraday level since 2008 on Monday, amid a stock market slump that also registered as the ugliest one-day plunge for the Dow Jones Industrial Average DJIA, +4.89%, the S&P 500 index SPX, +4.94% an the Nasdaq Composite Index COMP, +4.95% in 12 years.

But what’s arguably more impressive than the daily move for the gauge, that uses S&P 500 options to measure trader expectations for volatility in the coming 30-day period, is its year-to-date surge so far (see attached chart).

Compared against the move for the VIX at the same point this year in 2008, the differential between the two is dizzying. The VIX so far this year is on pace for a 280% surge, compared against a 108% return for the fear index in 2008—a period marked by the global proliferation of esoteric mortgage bonds and derivatives that brought world-wide financial markets to their knees and ushered in the 2007-09 recession.



“That spread is remarkable to see what’s going on out there in the [VIX],” Mark Longo CEO of The Options Insider, an options-focused analytics firm, told MarketWatch.


The rise in the VIX usually correlates to a decline in stocks because traders and investors use it to hedge their equity positions.

The surge in the VIX was at least partially sparked by an outbreak of COVID-19, the infectious disease that was first identified in Wuhan, China in December and has sickened roughly 117,000 people and claimed more than 4,260 lives, implying that fears of the deadly pathogen to this point by far outstrip those pegged to an implosion of the global financial markets.


That may have been the inflection point, the coronavirus,” Longo said.

Longo also said the surge in VIX this year may reflect that the markets, which have enjoyed a period of quiescence, even amid a few bursts higher, may be entering a paradigm shift.

“We may be in a new volatility regime for the foreseeable future,” he said.

The options expert said it is worth noting that this period for the VIX is demonstrably different than 12 years ago because there are so many more products that are pegged to the VIX, including the VelocityShares VIX Short Term ETN VIIX, -8.30%, the iPath Series B S&P 500 VIX Mid-Term Futures ETN VXZ, -3.48%, and iPath S&P 500 Dynamic VIX ETN XVZ, -5.42% among a few.

Randy Warren, chief investment officer at Warren Financial, who focuses on VIX options, also said that on a year-to-date basis the peak for 2008 didn’t start to play out until August, September, and October as Fannie Mae and Freddie Mac went into conservatorship, Lehman Brothers went bankrupt, AIG required help from the government and investors wrestled with the fallout of all that. The VIX finished the full year 2008 up 130%, according to FactSet data.

The VIX hit a historical peak at 80.86 on Nov. 20, 2008 and had not again approached such a lofty level until Monday.

That said, Warren says his firm has made 10x its money on its VIX contract bets this year, but that those gains have only mitigated losses on its equity positions.

As far as where VIX is headed, Warren says it is anyone’s guess.

“It’s a really hard call at this point because [the VIX], it is really stretched. It’s like a rubber-band now,” he said, given its move from a recent low at around 13 or 14 in mid February. The VIX’s historical average usually is said to be about 19 or 20.

Longo emphasized that he thinks professionals use VIX futures to better measure volatility in the market rather than the so-called cash VIX, which is most commonly used.

He said the spread between the VIX and VIX contracts, the VIX is an index and the contracts are the tradable securities, have been stunning with unusual gaps of 12 points at some junctures in the market.

It isn’t clear to those traders what’s underpinning those odd moves. “I’ve never really seen it like that before--they are somewhat disassociated from futures. They should be in lockstep,” Longo said.

“It’s kind of a weird environment.”

ALEX JONES BUSTED FOR DRIVING WHILE INSANE

Conspiracy theorist Alex Jones arrested on DWI charge in Texas

Conspiracy theorist Alex Jones was arrested in Texas on a misdemeanor charge of driving while intoxicated, authorities said Tuesday.

Republicans are far more likely than Democrats to think the coronavirus threat is ‘exaggerated,’ new survey finds

Both groups agree, however, on how they would react to a federally mandated two-week self-quarantine for people exposed to COVID-19, the survey said

The CDC cautions that 'more cases of COVID-19 are likely to be identified in the United States in the coming days, including more instances of community spread.' David Ryder/Getty Images
March 10, 2020 

As U.S. health officials confirm more cases of the new coronavirus, a new survey suggests that Republicans are more likely than Democrats to believe COVID-19 concerns are overblown.

Some 62% of Republicans and Republican leaners say the seriousness of COVID-19, the disease caused by the coronavirus SARS-CoV-2, is “generally exaggerated,” according to a new Axios/SurveyMonkey poll of 4,633 adults conducted last week. Just 31% of Democrats and Democrat leaners and 35% of independents said the same.

Greater shares of Democrats than Republicans said they were likely to avoid large events like concerts or sporting events (67% vs. 49% “very” or “somewhat” likely); public spaces like malls, theaters and restaurants (53% vs. 37%); and social gatherings at friends’ and family members’ homes (38% vs. 25%).

The Centers for Disease Control and Prevention has said that community-based interventions like “social distancing” — defined as “remaining out of congregate settings, avoiding mass gatherings, and maintaining distance (approximately 6 feet or 2 meters) from others when possible” — can help slow the disease’s spread, among other measures. No vaccine exists.

Democrats and Republicans in the survey agreed, however, on how they would react to a federally mandated two-week self-quarantine for people exposed to the disease: Only 22% of respondents from both parties said such a measure would threaten personal rights and freedoms. Independents were slightly more likely to say the same, at 30%.

There were 116,588 COVID-19 cases and 4,090 deaths globally as of Tuesday afternoon; about 64,391 people had recovered, according to data published by Johns Hopkins University’s Center for Systems Science and Engineering. The U.S. had 791 cases as of Tuesday afternoon.

As the 2020 U.S. presidential race forges ahead, the coronavirus outbreak has hit the U.S. economy and further inflamed partisan tensions. Sen. Bernie Sanders, a Vermont independent, and former Vice President Joe Biden — the top vote getters in the Democratic primaries — have criticized President Trump’s response to the outbreak and said they would do a better job.

House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer, the top congressional Democrats, have also publicly urged Trump to “prioritize the needs of American workers and their families before the needs of major corporations” while responding to the outbreak.

Trump, who is reportedly considering options including a payroll-tax cut and paid sick leave, has accused media outlets and Democrats of spreading fear and trying to leverage the outbreak for political advantage.

“The Fake News Media and their partner, the Democrat Party, is doing everything within its semi-considerable power (it used to be greater!) to inflame the CoronaVirus situation, far beyond what the facts would warrant,” Trump wrote Monday on Twitter TWTR, +5.69%.

Personalities on presidentially favored Fox channels have offered divergent opinions on the severity of the outbreak: Fox News host Tucker Carlson warned that COVID-19 was a “real” threat that was “definitely not just the flu,” while Fox Business host Trish Regan called criticism of Trump’s response “yet another attempt to impeach the president.”

(Fox News and Fox Business parent Fox Corp. shares common ownership with News Corp NWSA, +7.57%, the parent of Wall Street Journal and MarketWatch publisher Dow Jones.)

The CDC says that immediate risk of exposure to the virus “is thought to be low” for the majority of people, noting that there isn’t widespread circulation in most U.S. communities. But it also cautions that people living in areas with community spread of the virus are at elevated risk, and that “more cases of COVID-19 are likely to be identified in the United States in the coming days, including more instances of community spread.”

“It’s likely that at some point, widespread transmission of COVID-19 in the United States will occur,” the agency said.

Former Vice President Joe Biden told a pro-gun worker he was “full of s***” during a testy exchange after speaking at an auto plant in Detroit.

William Cummings, USA TODAY•March 10, 2020

Michigan could redefine Democratic primary

Former Vice President Joe Biden got into a heated exchange with a worker over gun rights during a tour of a Detroit auto plant on Tuesday.

The worker, among a group surrounding Biden in their hardhats at the Fiat Chrysler plant, accused Biden of "actively trying to end our Second Amendment right" and "take away our guns" in the exchange, which was caught on video.

"You're full of ----," Biden responded. "I support the Second Amendment." He then appeared to tell an aide who was trying to end the conversation to "shush."

Biden went on to explain that he believes there are limits to the Second Amendment. He compared it to the limits on the First Amendment right to free speech, such as the famous example of not being able to yell "fire!" in a crowded theater.

The former vice president told the man he owned shotguns and that his sons were hunters.

"I'm not taking your gun away at all," Biden said.

The man repeated his accusation that Biden had pledged to take away peoples' guns.

"I did not say that," Biden said, his voice rising.

The man replied that there was a "viral video" of him saying he would.

"It's a viral video like the other ones they've been putting out that are simply a lie," said Biden. A recent video clip of remarks by Biden that was retweeted by President Donald Trump was labeled "manipulated media" by Twitter and "partly false" by Facebook.

"I support the Second Amendment," Biden adds while vising under-construction auto plant in Detroit. @CBSNews pic.twitter.com/sueOSBaY9P
— Bo Erickson CBS (@BoKnowsNews) March 10, 2020

A video of Biden meeting with former Rep. Beto O'Rourke, who supports a mandatory buyback program, after O'Rourke endorsed him has been shared as evidence that Biden plans to confiscate guns. But FactCheck.org determined that such spin on that video was "misleading."

In the video, Biden expresses admiration for O'Rourke's positions on assault weapons and climate change and warns O'Rourke's wife, Amy, that if he wins the election he is "coming for him," presumably to work under a Biden administration. Some conservative sites have shared the video with the implication that Biden was saying, "I'm coming for them," referring to guns.

After denying the claim that he wanted to confiscate guns, an agitated Biden then waved his finger in the man's face and mistakenly referred to "AR-14s."

The two men exchanged more words at that point, which were difficult to discern in the video.

"You're working for me, man," the worker then tells Biden, as the audio becomes clear again.

"I'm not working for you," Biden said. "Give me a break, man. Don't be such a horse's ---."

"Here's the deal. Are you able to own a machine gun?" Biden asks the worker.

"Machine guns are illegal," the man replies. Biden argues AR-15s should be illegal for the same reason before the man is led away by other workers.

Fact check: O’Rourke Endorsement Triggers False Posts on Biden’s Gun Policy
Democratic presidential candidate Joe Biden meets workers as he tours the Fiat Chrysler plant in Detroit, Michigan on March 10, 2020.

According to the platform laid on his website, Biden favors a ban on the sale and manufacture of assault rifles and high-capacity magazines. Those already in possession of such weapons would have a choice between selling them as part of a voluntary government buyback program, or registering them with the Bureau of Alcohol, Tobacco, Firearms and Explosives.

He also endorses expanded background checks, "red flag laws" aimed at keeping guns away from people suffering from mental illness, limits on how many guns people can buy and expanding the list of prohibited buyers.

Six states are voting in the Democratic presidential race on Tuesday, and of those Michigan has the most pledged delegates up for grabs. Polls have suggested Biden is the strong favorite to carry Michigan, though Sen. Bernie Sanders defied the polls and defeated Hillary Clinton there in 2016.

Biden has had other clashes with voters on the campaign trail.

Last month, he called a New Hampshire voter a "lying dog-faced pony soldier" after she asked him a question about his fourth-place finish in the Iowa caucuses.

In December, he called a man at an event in Iowa a "damn liar" when the man accused Biden of selling access to Ukraine. And at a New Hampshire campaign event later that month he called a heckler "an idiot."

'Manipulated media': Twitter uses label for first time after Trump retweets edited video clip of Biden

Contributing: Saranac Hale Spencer, FactCheck.org; The Associated Press

This article originally appeared on USA TODAY: Joe Biden has heated gun control exchange with Michigan worker

502

Published: March 10, 2020 at 2:25 p.m. ET

By 

Shawn Langlois

Joe Biden says he’s got no intention of confiscating guns.

 Reuters

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‘You’re full of sh—. ... Don’t tell me that, pal, or I’m going to go out and slap you in the face. ... Don’t be such a horse’s ass.’

That’s presidential hopeful Joe Biden at a campaign stop in Michigan firing back at a construction worker who accused him of trying to confiscate Americans’ guns.

“You are actively trying to end our Second Amendment right and take away our guns,” the man told Biden, adding that the former vice president vowed to do just that in “a viral video.”

The worker was likely referring to a clip that recently racked up clicks with the Facebook FB, +5.12% headline, “Joe Biden says if he wins he’s coming for our guns”. FactCheck.org determined the video was “used as fuel for misinformation” about Biden’s gun policy.

“I support the Second Amendment,” Biden explained. “I have a shotgun, I have a 20-gauge, a 12-gauge. My sons hunt. ... I’m not taking your gun away at all.”

Here’s a clip of the exchange in Detroit, via CBS News:

Biden was on hand to tour the Fiat Chrysler FCAU, +4.36% FCA, 2.498% assembly plant, where he was reportedly greeted warmly by hundreds of IBEW members before the spat.

“You’re the best damn workers in the world,” Biden said. “I promise you if I become your president you will never have a better friend in the White House. I’m union from, as my — I won’t say what my grandfather used to say — but from belt buckle to shoe sole, man.”

According to CBS, Biden was scheduled to meet with the leaders of a gun-control advocacy organization in Columbus, Ohio, later in the day. 

20 leading economists just signed a letter arguing Medicare for All would generate massive savings for American families

Business Insider•March 10, 2020

Sen. Bernie Sanders (I-VT) speaks while introducing health care legislation titled the "Medicare for All Act of 2019" with Sen. Kirsten Gillibrand (D-NY) and Sen. Jeff Merkley (D-OR), during a news conference on Capitol Hill, on April 9, 2019 in Washington, DCMore

Photo by The Asahi Shimbun via Getty Images


Twenty of the nation's leading economists argued in favor of Medicare for All in an open letter that Business Insider first published on Tuesday.

They argue that existing research suggests there would be massive savings and it would reduce waste in healthcare.

"There's been too much loose talk that Medicare for All is unaffordable. What's really unaffordable is the current system," signatory Gerald Friedman said in an interview.

Twenty of the nation's leading economists argued in support of Medicare for All in an open letter first published by Business Insider on Tuesday.

"We believe the available research supports the conclusion that a program of Medicare for All (M4A) could be considerably less expensive than the current system, reducing waste and profiteering inherent in the current system, and could be financed in a way to ensure significant financial savings for the vast majority of American households," the economists wrote in the open letter.

"Most important, Medicare for All will reduce morbidity and save tens of thousands of lives each year," the group of economists said.

The letter was provided by Business for Medicare for All, an advocacy group pressing for universal healthcare in the US.

The economists aren't coming out in favor of a specific candidate, though some have individually consulted with Democratic presidential campaigns (at least one has endorsed Sen. Bernie Sanders).

Instead, they're making the case that a government-run health insurance system would slash wasteful spending and generate massive savings for most Americans.

Dr. Gerald Friedman, a professor at the University of Massachussetts Amherst, told Business Insider that the best argument for a universal healthcare system is its potential ability to rein in the skyrocketing costs of healthcare.

"There's been too much loose talk that Medicare for All is unaffordable," Friedman said. "What's really unaffordable is the current system. We spend about twice the average for affluent countries in the OECD on healthcare," referring to the Organization of Economic Cooperation and Development.

Friedman also noted that increased spending often leads to worse health outcomes compared to other developed nations.

Among the letter's signatories are prominent progressive economists like former Labor secretary Robert Reich; Jeffrey Sachs, a leading expert on poverty; Gabriel Zucman and Emmanuel Saez, two professors at the University of California, Berkeley, who laid out plans for a wealth tax; and Darrick Hamilton, a professor of economics at the Ohio State University and a pioneer in economic inequality research.

Medicare for All is the signature plan of Sen. Bernie Sanders, the remaining progressive candidate in the Democratic primary. It would set up a new government health insurance system that provides comprehensive benefits to Americans and toss out deductibles, co-pays, and out-of-pocket spending. Private insurance would be eliminated as well.

Estimates for a system that ensures benefits on the scale Sanders is seeking is upwards of $30 trillion over 10 years. A recent study from the Economic Policy Institute, a left-leaning organization, suggested it could increase the wages of workers and boost the development of small businesses.

The proposal turned into an ideological faultline in the primary, dividing moderates like former Vice President Joe Biden who sought incremental measures to expand coverage and progressives such as Sanders calling to replace the existing system with something entirely new.

In addition to Sanders, Sen. Elizabeth Warren also rolled out a plan to achieve universal healthcare within four years before dropping out of the race.

Skeptics of Medicare for All argue it's a progressive pipe dream that won't be achieved anytime soon. They note it'd be an enormous lift politically even among Democrats, most of whom don't support the idea, The New York Times reported.

An ongoing poll from the Kaiser Family Foundation found that while a slim majority of the public supports Medicare for All, backing flips when respondents learn they could lose their private health insurance or pay more in taxes.

The economists in the letter, though, say that "shifting the burden" onto taxation of wealthier households would "magnify savings."

"A system that cuts costs and shifts financing to income and wealth taxes will dramatically lower this burden, producing significant savings for workers and businesses," they write.

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