vox--2020-02-20--Democratic hopes for climate policy may come down to this one weird Senate trick

Democratic hopes for climate policy may come down to this one weird Senate trick Share All sharing options for : Democratic hopes for climate policy may come down to this one weird Senate trick This piece was first published in May 2019 and has been lightly updated .
The US federal government is rapidly falling behind on climate change and clean energy policy .
If Republicans keep the presidency or either house of Congress in 2020 — if they retain veto power over federal legislation — it will continue falling behind .
They ’ ve made that very clear .
@ @ @ @ @ @ @ branches ?
They will have a brief window to act .
Voters typically tack back after a sweep election , punishing the president ’ s party ( see : 2010 ; 2014 ; 2018 ) .
So Democrats will likely have two years in which to get something big done .
What kind of climate policy could they get passed ?
One looming obstacle is the Senate filibuster .
Use of the filibuster — which requires a 60-vote supermajority to overcome — used to be rare , but during Obama ’ s administration @ @ @ @ @ @ @ by Mitch McConnell , made it routine .
As things now stand , effectively all Democratic bills are filibustered , meaning that all bills require a supermajority to pass .
Even Democrats ’ most optimistic 2020 projections have them winning 51 seats in the Senate , maybe 52 .
That means they would need eight or nine sympathetic Republican votes to get anything past a filibuster .
They are ... not going to get those votes .
For anything .
So Democrats are not going to pass anything unless they kill the filibuster @ @ @ @ @ @ @ many people think .
It ’ s the reason several presidential candidates , among them Elizabeth Warren and Pete Buttigieg , have advocated for scrapping the filibuster .
( Other Democrats , like Sen. Jeff Merkley of Oregon , have proposed changing the rule to restore the “ talking filibuster , ” which would force objecting senators to actually stay on the floor , talking , as long as they wanted to delay a bill . )
“ The first thing I want to do in Washington is pass my anti-corruption bill so @ @ @ @ @ @ @ need to make on climate , ” said Sen. Elizabeth Warren during the Wednesday Democratic debate in Las Vegas .
“ And the second is the filibuster .
If you ’ re not willing to roll back the filibuster , then you ’ re giving the fossil fuel industry a veto.
” But there is another possibility , one less often touted in public by Democrats but frequently discussed behind closed doors : budget reconciliation .
The idea of using reconciliation as a vehicle for climate policy has been floating around since at @ @ @ @ @ @ @ , it has returned with a vengeance .
I spent a week or so discussing it with a variety of Senate scholars and current and former aides .
In this post , I ’ ll summarize what they told me about what budget reconciliation is , what type of climate policy might pass through it , and the political implications of using it .
The TL ; DR version : It ’ s a special kind of bill meant to reconcile the federal budget that only requires a majority vote in the Senate @ @ @ @ @ @ @ partisan gridlock , the boundaries of its use have been pushed by both parties .
“ As polarization has made it harder to legislate under regular order , ” says Molly Reynolds , a congressional scholar at the Brookings Institution , “ the pot of gold at the end of the reconciliation rainbow has become more and more valuable as a way to pursue party-defining achievements.
” To get Green New Deal-size things done through reconciliation , Dems would have to push its boundaries even further .
Pursuing policy objectives “ is not @ @ @ @ @ @ @ process , ” says Bill Hoagland , a onetime Senate staffer now at the Bipartisan Policy Center , but these days “ reconciliation is being used by both sides to carry out much broader public policy goals.
” It is yet another norm , crumbling , and it forces Democrats to make a decision they ’ ve faced again and again in the face of Republican radicalization : Do they take advantage of crumbling norms to get things done ?
Or do they respect and attempt to restore the norms ?
As ever @ @ @ @ @ @ @ My take — what Ezra Klein concluded in his piece on reconciliation and health care — is that even in terms of norm-busting , abusing reconciliation seems less defensible than simply restoring majority rule by scrapping the filibuster .
To get truly adequate climate policy , or health care policy , or any policy at all , the majority needs to be able to legislate .
It ’ s fundamental .
Still , if it ’ s to be reconciliation , there is quite a bit of room to maneuver — different levels @ @ @ @ @ @ @ bring to bear on the process .
We ’ ll get into that in a minute , but first , we must pause for a brief civics lesson .
Have a sip of coffee .
We ’ re going to talk budget .
If you want a deep dive into the history and purpose of reconciliation , I highly recommend Dylan Matthews ’ s explainer on the subject .
Here I ’ ll just try to cover the basics .
It all goes back to the Congressional Budget Act of 1974 , which @ @ @ @ @ @ @ way Congress passes a federal budget .
( Among other things , it created the Congressional Budget Office , which provides lawmakers with objective budget analysis . )
Here ’ s how the budget process works , as laid out by the CBA .
First , the House and Senate budget committees produce and pass a budget resolution , which sets an overall cap on federal discretionary spending and allocates spending to various areas ( note , this first step alone has been no easy task in recent years ) .
Then Appropriations @ @ @ @ @ @ @ within those spending parameters .
But wait .
Appropriations committees only control discretionary spending .
A huge chunk of the federal budget is taken up by mandatory spending , prescribed by previous laws , things like Medicare , Medicaid , and food stamps .
Mandatory spending falls under the purview of other committees .
And then there ’ s the tax code , controlled by the Senate Finance and House Ways and Means committees .
In order to keep federal spending within the cap set by the budget resolution , sometimes mandatory spending @ @ @ @ @ @ @ futzed with .
Thus , reconciliation , a process to make sure all the spending numbers from all these committees add up .
Typically once a year , a budget reconciliation bill is passed in the Senate by a simple majority vote .
Debate is limited to 20 hours , and non-germane amendments are prohibited — it is , as Matthews says , much easier to pass than most bills .
Because it is so much easier to pass , reconciliation has carried increasing freight throughout the years .
It was used to @ @ @ @ @ @ @ George H.W .
Bush .
It was used to pass the George W. Bush tax cuts .
It was what allowed Obamacare to pass and what enabled Trump ’ s recent tax cuts for the wealthy .
Not just anything can be passed via reconciliation , though .
The Senate is limited only by the Senate Here ’ s where things start to get fuzzy .
It ’ s important , when discussing the boundaries of Senate procedure , to remember that the Senate largely imposes those boundaries on itself , through self-adopted @ @ @ @ @ @ @ decade , as Republican Senate Majority Leader Mitch McConnell has trampled on one Senate norm after another in pursuit of power , those boundaries have begun to look less like fixed features of the landscape and more like choices .
The filibuster itself was one such norm .
When McConnell needed it to block Democratic bills , he made it routine .
Now he is jamming through right-wing judges at the rate of several a week , on a simple majority vote , with debate limited to two hours .
Yes , two @ @ @ @ @ @ @ to scrap the filibuster — in the case of judges , a particular interest of conservatives — in order to accomplish his goals .
So he did .
He values those goals more than precedent or procedure .
The same is ultimately true of any of the rules discussed below : They are imposed on the Senate by the Senate , and could be changed by a majority vote in the Senate .
Whether to respect them and leave them unmolested is not a choice about law ; it ’ s a choice @ @ @ @ @ @ @ in the end , is whether the importance of those norms outweighs the benefits of the policies that might be passed by violating them .
Over and over again , Republicans have chosen outcomes over norms .
If Dems take power , they will face the same choice , repeatedly .
With that said , let ’ s talk about the current boundaries of reconciliation .
The big and most obvious limitations are that a budget reconciliation bill is typically only passed once a year , can not create or change regulations , @ @ @ @ @ @ @ discretionary spending ( things like research , defense , and environmental protection ) .
It can only mess with mandatory spending or the tax code .
Within that basic framework , the biggest limitations are imposed by the “ Byrd Rule , ” introduced by then-Senate Minority Leader Robert Byrd in 1985 ( and subsequently incorporated into the CBA in 1990 ) .
He wanted to prohibit “ extraneous ” measures in reconciliation bills .
He defined as extraneous any measures that ( quoting Matthews ) : “ change Social Security ; don @ @ @ @ @ @ @ spending or revenue , or where such a change is merely ‘ incidental ’ ; increase deficits outside the 10-year budget window , and/or are outside the jurisdiction of the committee recommending them.
” All reconciliation bills receive a special analysis to see if they abide by these restrictions , a process known semi-affectionately as a “ Byrd bath.
” This set of restrictions creates a kind of conceptual puzzle into which reconciliation policies must fit .
They must materially affect spending or revenue , but they must balance out over the budget @ @ @ @ @ @ @ Any new spending or tax expenditure must be paid for within that window .
Remember how George W. Bush passed a bunch of tax cuts for the wealthy and then during Obama ’ s first term there was an enormous battle over whether to reauthorize them ?
Bush ’ s tax cuts were set to lapse abruptly after 10 years .
They had to , in order to balance out the 10-year budget window , pass a Byrd bath , and be included in a reconciliation bill .
( Donald Trump ’ s @ @ @ @ @ @ @ 10 years . )
Beyond the Byrd Rule , there are other , more recent rules governing reconciliation .
Matthews summarizes : In addition to rigging the rules in their favor , Republicans egregiously violated a number of longstanding congressional norms to get their 2017 tax cuts passed .
That bill explicitly pursued ideological goals — to enrich the already rich and undermine public health care — and was passed in an unprecedentedly rushed and chaotic fashion .
“ They abandoned all the congressional processes that have been developed over the years to @ @ @ @ @ @ @ ” says law professor and former congressional staffer Greg Dotson .
“ They didn ’ t hold hearings on the legislative proposals .
They didn ’ t negotiate with , or even adequately inform , the minority party .
They didn ’ t collect expert views on the legislative language before it was acted upon .
They disregarded the Congressional Budget Office .
The full list of precedential breaches is really quite impressive.
” It ’ s clear that the longer Republicans retain power , the less they will allow rules or precedent @ @ @ @ @ @ @ ve already demonstrated that they have no restraint , ” says Sen. Jeff Merkley of Oregon .
If Democrats take power , are they going to treat that rushed and chaotic process as precedent ?
Or will they attempt to restore the norms Republicans have trampled ?
The answers to those questions create the parameters in which Democrats might act on climate policy through reconciliation .
What sort of climate policy might pass through reconciliation ?
With a majority , Democrats can fairly easily change the recent rules Republicans have imposed on reconciliation @ @ @ @ @ @ @ the Senate parliamentarian [ the congressional officer who adjudicates disputes over rules ] that enabled them to increase deficits by using reconciliation , ” says Merkley , “ the exact opposite of what it was intended for .
That ’ s a very significant change and a demonstration of the fact that this loophole can move in different directions.
” Let ’ s assume for the moment that Democrats will abide by the Byrd Rule : All reconciliation provisions must materially affect federal spending or revenues ( and that budget impact must be @ @ @ @ @ @ @ purpose of the provision ) , and the bill as a whole can not raise the budget deficit outside the budget window covered by the bill , typically 10 years .
What can Dems do on climate policy within those parameters ?
The answer seems to be : a lot .
But exactly how much depends on how aggressive they are willing to be in pushing the boundaries of reconciliation .
There is an enormous amount possible within Byrd parameters .
Just about any kind of tax charge or expenditure is fair game @ @ @ @ @ @ @ spending .
Congress could create a federal Green Bank and unleash a huge round of green infrastructure spending — new transmission lines , smart-grid upgrades , high-speed rail , public transit — across the country .
It could help fund state climate action plans .
It could increase , improve , and extend tax rebates for zero-emission vehicles , renewable energy , energy storage , and carbon capture .
It could create new tax rebates , to encourage everything from distributed energy to green manufacturing , regenerative agriculture , and community-based resilience .
@ @ @ @ @ @ @ and unemployment benefits are all mandatory spending .
“ This may be where a just transition can begin , ” says Greg Carlock of Data for Progress , “ by adding funds and eligibility requirements for states to open up entitlements to workers leaving fossil fuel industries.
” Similarly , mandatory spending in other departments ( think Education or Energy ) could be tweaked to support a comprehensive climate agenda .
Washington Gov .
Jay Inslee , the former presidential candidate , wrote an Evergreen Economy Plan that contains dozens more ideas for @ @ @ @ @ @ @ climate impact .
How to pay for all this ?
One obvious idea is a carbon tax , which is likely to be on the table if it comes to reconciliation .
Perhaps a tax-and-dividend system that returns tax revenues to citizens on a per capita basis will be discussed , though I think that would be a huge mistake in this context — the spending should go to clean energy !
To help raise revenue , the bill could also raise excise taxes on fossil fuels , roll back fossil fuel subsidies @ @ @ @ @ @ @ cuts , or implement any number of new taxes on wealthy people or financial institutions .
( Elizabeth Warren has a few ideas . )
With some thought and a modicum of ambition , a reconciliation bill could be hugely significant for climate .
Some Green New Deal activists are urging Chuck Schumer to start any new Democratic term with something like this , using reconciliation to pass a “ greener American Recovery and Reinvestment Act , on steroids , ” as Evan Weber of the Sunrise Movement puts it .
( It @ @ @ @ @ @ @ , but Obama ’ s stimulus was , among other things , the largest clean energy bill in US history . )
This would mean a different way of thinking about climate strategy .
Rather than viewing climate policy as a liability , a one-shot-only act of falling on the sword ( which is how many legislators view the House passing the Waxman-Markey climate bill in 2009 ) , Democrats could make their opening bid on climate something positive and popular , i.e.
, spending money !
These investments would span the country @ @ @ @ @ @ @ millions of jobs .
People like that sort of thing .
It might even expand the political map for Democrats and enable them to do more climate policy .
One of the toughest restrictions on reconciliation is that it can only tax and spend — it can not be used to make regulatory policy changes .
( That ’ s why , when Republicans were attempting to repeal Obamacare in 2017 , they were only going after the taxing and spending portions .
They could not repeal the rules on health insurers through @ @ @ @ @ @ @ failed anyway , because they couldn ’ t find 50 votes for it . )
This rules out quite a bit of important climate policy , most notably performance standards , which have proven enormously effective in reducing greenhouse gas emissions .
A reconciliation bill can ’ t change federal fuel economy standards , appliance standards , building codes , or anything of that sort .
But reconciliation might still be configured to reach similar goals .
One key fact here is that while reconciliation can not direct discretionary spending — those year-to-year @ @ @ @ @ @ @ appropriators — “ you can create new entitlements that act in many ways like discretionary spending , ” says Zach Moller , a former Senate Budget Committee staffer now at Third Way .
And , of course , the tax code is fair game .
Imagine , if you will , a system of federal tax fees and rebates on vehicles .
For each vehicle class , vehicles that fall under the average fuel efficiency of the class pay a proportionate fee ; those that exceed the average receive a proportionate rebate .
@ @ @ @ @ @ @ for each vehicle class is recalculated and the fees and rebates are adjusted accordingly .
( You could implement it at the level of the individual vehicle or at the level of vehicle manufacturer , whichever worked best . )
This kind of “ feebate ” program would certainly affect federal spending and revenue , thus presumably satisfying the Byrd Rule .
But it would have the effect of imposing a perpetually rising fuel economy standard on vehicles .
It would be CAFE standards by other means .
Or imagine a federal clean @ @ @ @ @ @ @ of being imposed directly , it is tied to the federal wire charges utilities pay to move electricity over long-distance transmission lines .
Just adjust the charges so that it costs less to transport clean energy .
( Thanks to Mike Carr , a former senior counsel to the Senate Energy and Natural Resources Committee , for this idea . )
You could do something similar with performance standards on appliances , buildings , factories , or what have you — translate the standard into a feebate program , and voila , it @ @ @ @ @ @ @ feebate programs automatically balance out financially , there ’ s no worry about the 10-year budget window .
Similarly , pollution standards could be translated into fees .
“ Congress wouldn ’ t be able to use reconciliation to require natural gas producers to use state-of-the-art technology to prevent fugitive methane emissions , ” says Dotson , “ but they could levy stiff and appropriate fees on any producer not using state-of-the-art technology.
” If you really stretch your brain , you can imagine ways of translating just about any climate policy into @ @ @ @ @ @ @ .
Is there any limit to this kind of bankshot policymaking in reconciliation ?
Well , yes .
Her name is Elizabeth MacDonough .
She is the Senate parliamentarian , the congressional officer charged with advising the Senate on rules and procedures , and has been since 2012 .
( She is the first woman to hold the position . )
If Democrats introduce a reconciliation provision and Republicans challenge it under the Byrd Rule , she advises the chair , who then issues a ruling .
“ No one ’ s opinion @ @ @ @ @ @ @ Moller .
The fuzzy area , where MacDonough will likely be called upon , has to do with whether a provision ’ s changes in spending and revenue are “ incidental ” to its purpose .
There ’ s no clear definition of “ incidental , ” so she will be making some judgment calls , and it ’ s difficult to know how far she would let this kind of policymaking-by-proxy go on .
Which brings us to ...
If Democrats truly wanted to declare all-out partisan warfare , they could fire @ @ @ @ @ @ @ committed to the widest possible scope for reconciliation .
Or they could have a Democratic VP do what Bernie Sanders staff director Warren Gunnels threatened on Twitter : rule that any judgment of the parliamentarian that goes against Democrats can be overruled by a simple majority vote .
( This is what Ted Cruz advocated during the Obamacare repeal debate , though his colleagues didn ’ t take him up on it . )
That would effectively throw the budget reconciliation process open to anything that could get a majority vote , including @ @ @ @ @ @ @ I spoke to views this strategy as both unlikely and unpleasant to contemplate .
Josh Huder , a scholar of congressional procedure at Georgetown ’ s Government Affairs Institute , calls it “ dangerous , bordering on authoritarian.
” It would destroy one of the last Senate norms still standing .
“ The principle here is that the presiding officer in a deliberative assembly isn ’ t supposed to make procedural rulings according to the views of whoever sits in the chair , ” says political scientist Sarah Binder of George Washington University @ @ @ @ @ @ @ chair will rule according to existing rules and past interpretations .
So in that sense , I do see it as a quasi-nuclear move in itself.
” Among other things , it would definitively destroy any possibility of even a small handful of Republican votes on any provision .
“ You will create a toxic situation where all members of the other party will band together , ” says Moller .
Every provision would be challenged ; every overriding of precedent would require another vote .
Almost every single Democrat in the Senate @ @ @ @ @ @ @ violating the rules , again and again .
It ’ s like killing the filibuster , but doing it in the least defensible and most extended way possible .
“ I would conclude the budget process is truly dead and the last nail has been pounded into its coffin , ” Hoagland says .
Senate Democrats are extremely unlikely to support this kind of norm-trampling , despite seeing their counterparts across the aisle do it repeatedly .
And no amount of Sanders revolution-speak is likely to change their minds .
“ They will @ @ @ @ @ @ @ , ” says Dotson .
“ They ’ ll hold hearings and try to enlist some GOP support.
” ( Sanders undoubtedly knows this ; he is , after all , the ranking member on the Senate Budget Committee . )
One reason many Senate Dems support the filibuster is that it gives them cover and conceals differences within the party .
“ If conditions are ripe — new Democratic president and ambitious , cohesive Democratic House and Senate on a particularly salient issue to the Democrats — the Byrd Rule could well @ @ @ @ @ @ @ “ But absent that partisan wave , the Byrd Rule is a convenient way for a new majority to blame the other party for inaction.
” Anyone who has followed politics for a few decades knows that Democrats in a majority are rarely cohesive .
“ Democrats would almost certainly be forced to go on record in a way that could be described as ‘ breaking the rules ’ and ‘ ending the filibuster ’ , ” says Reynolds , “ and whether there would be some Democrats who are unwilling to do @ @ @ @ @ @ @ underlying legislation , is an important possibility to consider.
” Moller is less equivocal : “ You would lose that hypothetical majority.
” Senate Democrats will not enjoy , and are unlikely to accede to , being forced to vote over and over again on a series of Republican amendments meant to peel them off from an aggressively partisan course of action .
There are any number of provisions that would have difficulty gathering 51 Democratic votes even in the best of circumstances .
No , it ’ s likely that Democrats will @ @ @ @ @ @ @ process and be cautious about pushing its limits .
( Remember , with only one reconciliation bill a year , many interest groups will be jostling to have their priorities included , and all will be keen for it to pass . )
Egregiously violating the rules of reconciliation would be wildly out of character .
Budget reconciliation might be an appropriate venue for an opening bid on climate policy .
Ambition level one — the stimulus on steroids — is plenty ambitious .
But to truly pass a complete climate policy , @ @ @ @ @ @ @ Democrats ( assuming their far-from-certain victories in 2020 ) would have to stretch the reconciliation process well beyond its traditional bounds , a pure partisan play for which they and the parliamentarian are likely to have little appetite .
Even if they were willing to do that , it ’ s not going to result in particularly good policy .
Hoagland says that Senate staffers used to refer to reconciliation as making policy into Swiss cheese , once the Byrd-prohibited provisions were removed .
It ’ s the reason Republicans ’ Obamacare repeal @ @ @ @ @ @ @ , ” Reynolds says — it could cancel spending but not reverse regulations .
And even the provisions that do qualify under Byrd are not optimal .
It is not healthy to continue channeling policy through the tax code , where its impacts are obscured .
Which brings us back , again , to the filibuster .
“ One of the things that puzzles me ” about passing ambitious policy through reconciliation , says Moller , “ is why are we doing this instead of , at the start of the Senate term @ @ @ @ @ @ @ s a simple process , where this is kind of convoluted.
” “ Presumably if they have the votes to sustain these kinds of rulings , they have the votes to nuke the filibuster , ” says Huder .
“ That advances their cause without violating laws and rules of procedure.
” The filibuster needs to go .
In a modern society , the majority needs to be able to legislate .
As long as the majority in the US is unable to implement its policy preferences , nothing — not reconciliation , @ @ @ @ @ @ @ Joe Biden ’ s magical bipartisanship powers — will save the country from multiple ongoing crises , climate change most notable among them .
And it ’ s not just the filibuster .
There is a whole range of reforms needed to the rickety US system of elections and governance , changes that make ambitious policy , on climate or anything else , possible .
Democrats need to pass those reforms , by simple majority if necessary .
“ Mitch McConnell and President Trump are shredding the Constitution using simple majority .
They @ @ @ @ @ @ @ majority , ” says Merkley .
“ We would not be fulfilling our responsibilities if we did not defend the constitution by simple majority.
” When it comes to climate policy , reconciliation is a hack .
To get the job done , US democracy ’ s source code needs to be rewritten .

Democratic hopes for climate policy may come down to this one weird Senate trick
Share All sharing options for: Democratic hopes for climate policy may come down to this one weird Senate trick
This piece was first published in May 2019 and has been lightly updated.
The US federal government is rapidly falling behind on climate change and clean energy policy. If Republicans keep the presidency or either house of Congress in 2020 — if they retain veto power over federal legislation — it will continue falling behind. They’ve made that very clear.
But what if Democrats take all three branches?
They will have a brief window to act. Voters typically tack back after a sweep election, punishing the president’s party (see: 2010; 2014; 2018). So Democrats will likely have two years in which to get something big done.
What kind of climate policy could they get passed?
One looming obstacle is the Senate filibuster. Use of the filibuster — which requires a 60-vote supermajority to overcome — used to be rare, but during Obama’s administration, Republicans in the Senate, led by Mitch McConnell, made it routine. As things now stand, effectively all Democratic bills are filibustered, meaning that all bills require a supermajority to pass.
Even Democrats’ most optimistic 2020 projections have them winning 51 seats in the Senate, maybe 52. That means they would need eight or nine sympathetic Republican votes to get anything past a filibuster. They are ... not going to get those votes. For anything.
So Democrats are not going to pass anything unless they kill the filibuster, right?
That is certainly what many people think. It’s the reason several presidential candidates, among them Elizabeth Warren and Pete Buttigieg, have advocated for scrapping the filibuster. (Other Democrats, like Sen. Jeff Merkley of Oregon, have proposed changing the rule to restore the “talking filibuster,” which would force objecting senators to actually stay on the floor, talking, as long as they wanted to delay a bill.)
“The first thing I want to do in Washington is pass my anti-corruption bill so we can start making the changes we need to make on climate,” said Sen. Elizabeth Warren during the Wednesday Democratic debate in Las Vegas. “And the second is the filibuster. If you’re not willing to roll back the filibuster, then you’re giving the fossil fuel industry a veto.”
But there is another possibility, one less often touted in public by Democrats but frequently discussed behind closed doors: budget reconciliation.
The idea of using reconciliation as a vehicle for climate policy has been floating around since at least 2009, and as 2020 approaches, it has returned with a vengeance. I spent a week or so discussing it with a variety of Senate scholars and current and former aides. In this post, I’ll summarize what they told me about what budget reconciliation is, what type of climate policy might pass through it, and the political implications of using it.
The TL;DR version: It’s a special kind of bill meant to reconcile the federal budget that only requires a majority vote in the Senate to pass. In an age of partisan gridlock, the boundaries of its use have been pushed by both parties. “As polarization has made it harder to legislate under regular order,” says Molly Reynolds, a congressional scholar at the Brookings Institution, “the pot of gold at the end of the reconciliation rainbow has become more and more valuable as a way to pursue party-defining achievements.” To get Green New Deal-size things done through reconciliation, Dems would have to push its boundaries even further.
Pursuing policy objectives “is not what the drafters envisioned for the reconciliation process,” says Bill Hoagland, a onetime Senate staffer now at the Bipartisan Policy Center, but these days “reconciliation is being used by both sides to carry out much broader public policy goals.”
It is yet another norm, crumbling, and it forces Democrats to make a decision they’ve faced again and again in the face of Republican radicalization: Do they take advantage of crumbling norms to get things done? Or do they respect and attempt to restore the norms? As ever, there is no good answer.
My take — what Ezra Klein concluded in his piece on reconciliation and health care — is that even in terms of norm-busting, abusing reconciliation seems less defensible than simply restoring majority rule by scrapping the filibuster. To get truly adequate climate policy, or health care policy, or any policy at all, the majority needs to be able to legislate. It’s fundamental.
Still, if it’s to be reconciliation, there is quite a bit of room to maneuver — different levels of ambition and chutzpah that Democrats might bring to bear on the process. We’ll get into that in a minute, but first, we must pause for a brief civics lesson.
Have a sip of coffee. We’re going to talk budget.
What is budget reconciliation?
If you want a deep dive into the history and purpose of reconciliation, I highly recommend Dylan Matthews’s explainer on the subject. Here I’ll just try to cover the basics.
It all goes back to the Congressional Budget Act of 1974, which attempted to impose some order on the way Congress passes a federal budget. (Among other things, it created the Congressional Budget Office, which provides lawmakers with objective budget analysis.)
Here’s how the budget process works, as laid out by the CBA. First, the House and Senate budget committees produce and pass a budget resolution, which sets an overall cap on federal discretionary spending and allocates spending to various areas (note, this first step alone has been no easy task in recent years).
Then Appropriations Committees pass bills on various subjects, within those spending parameters.
But wait. Appropriations committees only control discretionary spending. A huge chunk of the federal budget is taken up by mandatory spending, prescribed by previous laws, things like Medicare, Medicaid, and food stamps. Mandatory spending falls under the purview of other committees. And then there’s the tax code, controlled by the Senate Finance and House Ways and Means committees.
In order to keep federal spending within the cap set by the budget resolution, sometimes mandatory spending programs and the tax code must be futzed with. Thus, reconciliation, a process to make sure all the spending numbers from all these committees add up.
Typically once a year, a budget reconciliation bill is passed in the Senate by a simple majority vote. Debate is limited to 20 hours, and non-germane amendments are prohibited — it is, as Matthews says, much easier to pass than most bills.
Because it is so much easier to pass, reconciliation has carried increasing freight throughout the years. It was used to pass programs important to Bill Clinton and George H.W. Bush. It was used to pass the George W. Bush tax cuts. It was what allowed Obamacare to pass and what enabled Trump’s recent tax cuts for the wealthy.
Not just anything can be passed via reconciliation, though.
The Senate is limited only by the Senate
Here’s where things start to get fuzzy. It’s important, when discussing the boundaries of Senate procedure, to remember that the Senate largely imposes those boundaries on itself, through self-adopted rules and norms.
Over the past decade, as Republican Senate Majority Leader Mitch McConnell has trampled on one Senate norm after another in pursuit of power, those boundaries have begun to look less like fixed features of the landscape and more like choices.
The filibuster itself was one such norm. When McConnell needed it to block Democratic bills, he made it routine. Now he is jamming through right-wing judges at the rate of several a week, on a simple majority vote, with debate limited to two hours. Yes, two hours.
McConnell saw that he needed to scrap the filibuster — in the case of judges, a particular interest of conservatives — in order to accomplish his goals. So he did. He values those goals more than precedent or procedure.
The same is ultimately true of any of the rules discussed below: They are imposed on the Senate by the Senate, and could be changed by a majority vote in the Senate. Whether to respect them and leave them unmolested is not a choice about law; it’s a choice about norms. And the question, in the end, is whether the importance of those norms outweighs the benefits of the policies that might be passed by violating them.
Over and over again, Republicans have chosen outcomes over norms. If Dems take power, they will face the same choice, repeatedly.
With that said, let’s talk about the current boundaries of reconciliation.
What restrictions limit budget reconciliation?
The big and most obvious limitations are that a budget reconciliation bill is typically only passed once a year, cannot create or change regulations, and cannot create or direct any discretionary spending (things like research, defense, and environmental protection). It can only mess with mandatory spending or the tax code.
Within that basic framework, the biggest limitations are imposed by the “Byrd Rule,” introduced by then-Senate Minority Leader Robert Byrd in 1985 (and subsequently incorporated into the CBA in 1990). He wanted to prohibit “extraneous” measures in reconciliation bills. He defined as extraneous any measures that (quoting Matthews): “change Social Security; don’t change the overall level of spending or revenue, or where such a change is merely ‘incidental’; increase deficits outside the 10-year budget window, and/or are outside the jurisdiction of the committee recommending them.” All reconciliation bills receive a special analysis to see if they abide by these restrictions, a process known semi-affectionately as a “Byrd bath.”
This set of restrictions creates a kind of conceptual puzzle into which reconciliation policies must fit. They must materially affect spending or revenue, but they must balance out over the budget window (typically 10 years). Any new spending or tax expenditure must be paid for within that window.
Remember how George W. Bush passed a bunch of tax cuts for the wealthy and then during Obama’s first term there was an enormous battle over whether to reauthorize them? Bush’s tax cuts were set to lapse abruptly after 10 years. They had to, in order to balance out the 10-year budget window, pass a Byrd bath, and be included in a reconciliation bill. (Donald Trump’s tax individual tax cuts also expire after 10 years.)
Beyond the Byrd Rule, there are other, more recent rules governing reconciliation. Matthews summarizes:
From 2007 to 2011, Democrats and Congress further banned reconciliation from being used to increase deficits; Republicans junked that rule upon retaking power in the House. Since 2011, Republicans have adopted rules that block reconciliation’s use to expand mandatory spending at all, even if such spending is offset or more than offset by other cuts or taxes. That would effectively rule out using reconciliation to set up programs like SCHIP or boost Obamacare subsidies or expand the EITC, as it’s been used to do in the past.
In addition to rigging the rules in their favor, Republicans egregiously violated a number of longstanding congressional norms to get their 2017 tax cuts passed. That bill explicitly pursued ideological goals — to enrich the already rich and undermine public health care — and was passed in an unprecedentedly rushed and chaotic fashion.
“They abandoned all the congressional processes that have been developed over the years to promote transparency and encourage informed policymaking,” says law professor and former congressional staffer Greg Dotson. “They didn’t hold hearings on the legislative proposals. They didn’t negotiate with, or even adequately inform, the minority party. They didn’t collect expert views on the legislative language before it was acted upon. They disregarded the Congressional Budget Office. The full list of precedential breaches is really quite impressive.”
It’s clear that the longer Republicans retain power, the less they will allow rules or precedent to restrain them. “They’ve already demonstrated that they have no restraint,” says Sen. Jeff Merkley of Oregon.
If Democrats take power, are they going to treat that rushed and chaotic process as precedent? Or will they attempt to restore the norms Republicans have trampled? The answers to those questions create the parameters in which Democrats might act on climate policy through reconciliation.
What sort of climate policy might pass through reconciliation?
With a majority, Democrats can fairly easily change the recent rules Republicans have imposed on reconciliation. “Republicans got a ruling of the Senate parliamentarian [the congressional officer who adjudicates disputes over rules] that enabled them to increase deficits by using reconciliation,” says Merkley, “the exact opposite of what it was intended for. That’s a very significant change and a demonstration of the fact that this loophole can move in different directions.”
Let’s assume for the moment that Democrats will abide by the Byrd Rule: All reconciliation provisions must materially affect federal spending or revenues (and that budget impact must be more than “incidental” to the purpose of the provision), and the bill as a whole cannot raise the budget deficit outside the budget window covered by the bill, typically 10 years.
What can Dems do on climate policy within those parameters? The answer seems to be: a lot. But exactly how much depends on how aggressive they are willing to be in pushing the boundaries of reconciliation.
Ambition level 1: ambitious
There is an enormous amount possible within Byrd parameters. Just about any kind of tax charge or expenditure is fair game, along with existing and new mandatory spending.
Congress could create a federal Green Bank and unleash a huge round of green infrastructure spending — new transmission lines, smart-grid upgrades, high-speed rail, public transit — across the country. It could help fund state climate action plans. It could increase, improve, and extend tax rebates for zero-emission vehicles, renewable energy, energy storage, and carbon capture. It could create new tax rebates, to encourage everything from distributed energy to green manufacturing, regenerative agriculture, and community-based resilience.
Medicare, Medicaid, food stamps, and unemployment benefits are all mandatory spending. “This may be where a just transition can begin,” says Greg Carlock of Data for Progress, “by adding funds and eligibility requirements for states to open up entitlements to workers leaving fossil fuel industries.” Similarly, mandatory spending in other departments (think Education or Energy) could be tweaked to support a comprehensive climate agenda.
Washington Gov. Jay Inslee, the former presidential candidate, wrote an Evergreen Economy Plan that contains dozens more ideas for how to channel federal investment for maximum climate impact.
How to pay for all this? One obvious idea is a carbon tax, which is likely to be on the table if it comes to reconciliation. Perhaps a tax-and-dividend system that returns tax revenues to citizens on a per capita basis will be discussed, though I think that would be a huge mistake in this context — the spending should go to clean energy!
To help raise revenue, the bill could also raise excise taxes on fossil fuels, roll back fossil fuel subsidies, roll back the recent Trump tax cuts, or implement any number of new taxes on wealthy people or financial institutions. (Elizabeth Warren has a few ideas.)
With some thought and a modicum of ambition, a reconciliation bill could be hugely significant for climate. Some Green New Deal activists are urging Chuck Schumer to start any new Democratic term with something like this, using reconciliation to pass a “greener American Recovery and Reinvestment Act, on steroids,” as Evan Weber of the Sunrise Movement puts it. (It’s not often remembered this way, but Obama’s stimulus was, among other things, the largest clean energy bill in US history.)
This would mean a different way of thinking about climate strategy. Rather than viewing climate policy as a liability, a one-shot-only act of falling on the sword (which is how many legislators view the House passing the Waxman-Markey climate bill in 2009), Democrats could make their opening bid on climate something positive and popular, i.e., spending money!
These investments would span the country, stimulate the economy, and create millions of jobs. People like that sort of thing. It might even expand the political map for Democrats and enable them to do more climate policy.
Ambition level 2: super ambitious
One of the toughest restrictions on reconciliation is that it can only tax and spend — it cannot be used to make regulatory policy changes. (That’s why, when Republicans were attempting to repeal Obamacare in 2017, they were only going after the taxing and spending portions. They could not repeal the rules on health insurers through reconciliation. In the end, they failed anyway, because they couldn’t find 50 votes for it.)
This rules out quite a bit of important climate policy, most notably performance standards, which have proven enormously effective in reducing greenhouse gas emissions. A reconciliation bill can’t change federal fuel economy standards, appliance standards, building codes, or anything of that sort.
But reconciliation might still be configured to reach similar goals.
One key fact here is that while reconciliation cannot direct discretionary spending — those year-to-year decisions are still in the hands of appropriators — “you can create new entitlements that act in many ways like discretionary spending,” says Zach Moller, a former Senate Budget Committee staffer now at Third Way. And, of course, the tax code is fair game.
Imagine, if you will, a system of federal tax fees and rebates on vehicles. For each vehicle class, vehicles that fall under the average fuel efficiency of the class pay a proportionate fee; those that exceed the average receive a proportionate rebate. Each year, automatically, the average for each vehicle class is recalculated and the fees and rebates are adjusted accordingly. (You could implement it at the level of the individual vehicle or at the level of vehicle manufacturer, whichever worked best.)
This kind of “feebate” program would certainly affect federal spending and revenue, thus presumably satisfying the Byrd Rule. But it would have the effect of imposing a perpetually rising fuel economy standard on vehicles. It would be CAFE standards by other means.
Or imagine a federal clean energy standard for utilities, but instead of being imposed directly, it is tied to the federal wire charges utilities pay to move electricity over long-distance transmission lines. Just adjust the charges so that it costs less to transport clean energy. (Thanks to Mike Carr, a former senior counsel to the Senate Energy and Natural Resources Committee, for this idea.)
You could do something similar with performance standards on appliances, buildings, factories, or what have you — translate the standard into a feebate program, and voila, it affects spending and revenue. And because feebate programs automatically balance out financially, there’s no worry about the 10-year budget window.
Similarly, pollution standards could be translated into fees. “Congress wouldn’t be able to use reconciliation to require natural gas producers to use state-of-the-art technology to prevent fugitive methane emissions,” says Dotson, “but they could levy stiff and appropriate fees on any producer not using state-of-the-art technology.”
If you really stretch your brain, you can imagine ways of translating just about any climate policy into some kind of revenue or spending equivalent. Is there any limit to this kind of bankshot policymaking in reconciliation?
Well, yes. Her name is Elizabeth MacDonough. She is the Senate parliamentarian, the congressional officer charged with advising the Senate on rules and procedures, and has been since 2012. (She is the first woman to hold the position.) If Democrats introduce a reconciliation provision and Republicans challenge it under the Byrd Rule, she advises the chair, who then issues a ruling. “No one’s opinion matters more than hers,” says Moller.
The fuzzy area, where MacDonough will likely be called upon, has to do with whether a provision’s changes in spending and revenue are “incidental” to its purpose. There’s no clear definition of “incidental,” so she will be making some judgment calls, and it’s difficult to know how far she would let this kind of policymaking-by-proxy go on.
Which brings us to ...
Ambition level 3: berserker
If Democrats truly wanted to declare all-out partisan warfare, they could fire the parliamentarian and replace her with someone committed to the widest possible scope for reconciliation.
Or they could have a Democratic VP do what Bernie Sanders staff director Warren Gunnels threatened on Twitter: rule that any judgment of the parliamentarian that goes against Democrats can be overruled by a simple majority vote. (This is what Ted Cruz advocated during the Obamacare repeal debate, though his colleagues didn’t take him up on it.) That would effectively throw the budget reconciliation process open to anything that could get a majority vote, including, Gunnels says, Medicare-for-all.
Everyone I spoke to views this strategy as both unlikely and unpleasant to contemplate. Josh Huder, a scholar of congressional procedure at Georgetown’s Government Affairs Institute, calls it “dangerous, bordering on authoritarian.” It would destroy one of the last Senate norms still standing.
“The principle here is that the presiding officer in a deliberative assembly isn’t supposed to make procedural rulings according to the views of whoever sits in the chair,” says political scientist Sarah Binder of George Washington University. “The expectation is that the chair will rule according to existing rules and past interpretations. So in that sense, I do see it as a quasi-nuclear move in itself.”
Among other things, it would definitively destroy any possibility of even a small handful of Republican votes on any provision. “You will create a toxic situation where all members of the other party will band together,” says Moller.
Every provision would be challenged; every overriding of precedent would require another vote. Almost every single Democrat in the Senate would have to vote in favor of violating the rules, again and again.
It’s like killing the filibuster, but doing it in the least defensible and most extended way possible. “I would conclude the budget process is truly dead and the last nail has been pounded into its coffin,” Hoagland says.
Senate Democrats are extremely unlikely to support this kind of norm-trampling, despite seeing their counterparts across the aisle do it repeatedly. And no amount of Sanders revolution-speak is likely to change their minds.
“They will want to reinstate a modicum of process,” says Dotson. “They’ll hold hearings and try to enlist some GOP support.” (Sanders undoubtedly knows this; he is, after all, the ranking member on the Senate Budget Committee.)
One reason many Senate Dems support the filibuster is that it gives them cover and conceals differences within the party. “If conditions are ripe — new Democratic president and ambitious, cohesive Democratic House and Senate on a particularly salient issue to the Democrats — the Byrd Rule could well be undermined,” Binder says. “But absent that partisan wave, the Byrd Rule is a convenient way for a new majority to blame the other party for inaction.”
Anyone who has followed politics for a few decades knows that Democrats in a majority are rarely cohesive. “Democrats would almost certainly be forced to go on record in a way that could be described as ‘breaking the rules’ and ‘ending the filibuster’,” says Reynolds, “and whether there would be some Democrats who are unwilling to do that, even if they support the underlying legislation, is an important possibility to consider.”
Moller is less equivocal: “You would lose that hypothetical majority.”
Senate Democrats will not enjoy, and are unlikely to accede to, being forced to vote over and over again on a series of Republican amendments meant to peel them off from an aggressively partisan course of action. There are any number of provisions that would have difficulty gathering 51 Democratic votes even in the best of circumstances.
No, it’s likely that Democrats will respect the traditional contours of the reconciliation process and be cautious about pushing its limits. (Remember, with only one reconciliation bill a year, many interest groups will be jostling to have their priorities included, and all will be keen for it to pass.) Egregiously violating the rules of reconciliation would be wildly out of character.
Just scrap the damn filibuster
Budget reconciliation might be an appropriate venue for an opening bid on climate policy. Ambition level one — the stimulus on steroids — is plenty ambitious.
But to truly pass a complete climate policy, the kind appropriate to the challenge, Democrats (assuming their far-from-certain victories in 2020) would have to stretch the reconciliation process well beyond its traditional bounds, a pure partisan play for which they and the parliamentarian are likely to have little appetite.
Even if they were willing to do that, it’s not going to result in particularly good policy. Hoagland says that Senate staffers used to refer to reconciliation as making policy into Swiss cheese, once the Byrd-prohibited provisions were removed. It’s the reason Republicans’ Obamacare repeal bill was so “awkward and kludgy,” Reynolds says — it could cancel spending but not reverse regulations.
And even the provisions that do qualify under Byrd are not optimal. It is not healthy to continue channeling policy through the tax code, where its impacts are obscured.
NYT EDITORIAL: "The best way to end the Senate’s sorry history of inaction is to end the silent filibuster" http://t.co/sTzmZZtf — Senator Jeff Merkley (@SenJeffMerkley) January 22, 2013
Which brings us back, again, to the filibuster.
“One of the things that puzzles me” about passing ambitious policy through reconciliation, says Moller, “is why are we doing this instead of, at the start of the Senate term, repealing the filibuster? It’s a simple process, where this is kind of convoluted.”
“Presumably if they have the votes to sustain these kinds of rulings, they have the votes to nuke the filibuster,” says Huder. “That advances their cause without violating laws and rules of procedure.”
The filibuster needs to go. In a modern society, the majority needs to be able to legislate. As long as the majority in the US is unable to implement its policy preferences, nothing — not reconciliation, not Sanders’s revolution, not Joe Biden’s magical bipartisanship powers — will save the country from multiple ongoing crises, climate change most notable among them.
And it’s not just the filibuster. There is a whole range of reforms needed to the rickety US system of elections and governance, changes that make ambitious policy, on climate or anything else, possible. Democrats need to pass those reforms, by simple majority if necessary.
“Mitch McConnell and President Trump are shredding the Constitution using simple majority. They’re packing the courts by simple majority,” says Merkley. “We would not be fulfilling our responsibilities if we did not defend the constitution by simple majority.”
When it comes to climate policy, reconciliation is a hack. To get the job done, US democracy’s source code needs to be rewritten.


vox--2020-02-20--Coronavirus is starting to hit Big Tech’s bottom line

The outbreak of the Covid-19 coronavirus disease has taken the lives of over 2,100 people — with all but 11 of those deaths in China — and infected over 75,000 as of February 20 .
As the world scrambles to contain the public health crisis , global businesses are starting to take a hit , particularly in the technology sector .
China — which is the second-largest economy in the world — has all but halted its production of consumer goods like phones , clothing , and automobiles for the past several weeks .
The country has taken on unprecedented @ @ @ @ @ @ @ virus ’ s spread , such as placing severe restrictions of some 780 million people and instituting mass quarantines in major cities .
The Wall Street Journal reports that the lockdown on Chinese manufacturing has caused global markets to “ shudder ” and is casting an “ ever-widening shadow ” on the economy at large .
That ’ s particularly relevant in the tech industry , which depends on Chinese labor to build everything from computer chips to cellphone parts .
In recent days , China has started reopening its factories ( despite @ @ @ @ @ @ @ to restart its economy , but manufacturing sites are still running at a far lower capacity than usual .
It ’ s still too early to measure the full financial impact of the virus on the tech industry , but the early signs don ’ t look good .
Apple — the world ’ s most valuable tech company — said it is reducing its revenue targets this quarter in a rare company advisory released on Monday .
Tesla said last week that “ health epidemics ” are a risk to its business @ @ @ @ @ @ @ on the flow of goods between China , the US , and other countries , has not released any similar warnings but is stockpiling supplier items from China to protect against future disruptions due to the virus .
And Chinese companies themselves are feeling the hit , with tech giant Alibaba calling the outbreak a “ black swan ” event ( as in , unpredictable ) on a recent earnings call .
Social media companies — which are trying to keep up with a slew of misinformation about the virus ’ s origins @ @ @ @ @ @ @ impacted than companies like Apple since their main line of business isn ’ t selling physical goods .
But even Facebook has been affected , setting reduced production goals for its Oculus Quest virtual reality headsets in part due to a slowdown in Chinese manufacturing because of the virus .
And virtually all the major tech companies — Apple , Google , Facebook , Amazon , and Microsoft — have restricted employee travel to China , either banning or limiting it only to matters of critical importance .
They ’ re also asking @ @ @ @ @ @ @ home for up to two weeks .
In some cases , tech professionals in the US are so concerned about the virus that they ’ re taking other precautions , such as wearing breathing masks and eliminating handshakes in business meetings , as Recode previously reported .
For now , there are only four confirmed cases in the San Francisco Bay Area , but some feel these preventative measures are important given the high volume of travel between China and Silicon Valley — and concerns that the virus could quickly grow out of @ @ @ @ @ @ @ Asia .
Overall , the economic and social impact the coronavirus is having on the tech industry puts into stark relief the close connection between Silicon Valley and China , not just for manufacturing but for supplying a workforce of highly skilled engineers , investor funds , and academic collaboration .
Outside the workplace , tech companies are pulling out of major global conferences or canceling them altogether .
As Recode reported last week , Facebook canceled a 5,000-person global marketing conference in San Francisco .
And the world ’ s largest phone @ @ @ @ @ @ @ was canceled after major tech companies like Amazon pulled out over coronavirus concerns .
Here are more specifics on some of the main ways we are seeing coronavirus impact the global economy , particularly in the tech industry .
Virtually every major US tech company that builds physical products — like cellphones , computers , or video game consoles — relies on a vast Chinese workforce to manufacture products for cheaper than could be done in the US .
In the past few weeks , though , that supply chain , which includes @ @ @ @ @ @ @ , has been fundamentally disrupted .
Factories in China have been shut down .
Hundreds of millions of migrant workers who were visiting family in cities outside the main manufacturing hubs for Chinese New Year were quarantined .
Some are beginning to return to work , but reports indicate that as of earlier this week , over two-thirds remain stuck .
Roads have been blocked , trains halted , and flights canceled .
In its advisory , Apple said Monday that “ worldwide iPhone supply will be temporarily constrained ” because its manufacturing @ @ @ @ @ @ @ slower return to normal conditions ” than anticipated as manufacturing sites in the region slowly reopen .
The New York Times reports that even though some factories are starting up again , they are still “ operating well below capacity.
” And there are serious public health concerns about whether reopening the factories is the right decision at all , considering the virus continues to spread in China and elsewhere .
Companies are increasingly talking about the threat of the virus in public business announcements .
A MarketWatch report found that out of @ @ @ @ @ @ @ recent earnings calls between January 1 and February 13 , 38 percent of transcripts included the term “ coronavirus ” at least once .
Another major tech company with its supply chain impacted by the virus is Amazon .
It ’ s estimated that over 40 percent of Amazon sellers are based in China , which means that a large chunk of the products people buy comes from the country .
In addition to that , a large portion of US-based sellers source their products from China .
According to a recent Business @ @ @ @ @ @ @ week to a number of suppliers for products sold in the US but made in China and encouraged them “ to stockpile on certain products shipped from China , in anticipation of potential supply chain slowdowns caused by the coronavirus outbreak in the region , ” according to the outlet .
In response to a question about this practice , Amazon sent Recode the following statement : “ Out of an abundance of caution , we are working with suppliers to secure additional inventory to ensure we maintain our selection for customers.
” @ @ @ @ @ @ @ Oculus Quest headsets is impacted by the outbreak .
“ Oculus Quest has been selling out in some regions due to high demand , ” Facebook spokesperson Anthony Harrison wrote in a statement to Recode .
“ That said , like other companies , we ’ re expecting some additional impact to our hardware production due to the coronavirus .
We ’ re taking precautions to ensure the safety of our employees , manufacturing partners and customers , and are monitoring the situation closely .
We are working to restore availability as soon @ @ @ @ @ @ @ outbreak is impacting business is by reducing Chinese consumers ’ demand for consumer electronics .
China is the United States ’ third-largest and most rapidly growing market for exports , which means that US companies are increasingly setting revenue goals that rely on Chinese residents buying their products .
Apple in particular made a whopping $ 52 billion in sales in the last fiscal year by selling its products ( mostly iPhones ) in the country .
With the recent easing of tensions in the US-China trade war , analysts were anticipating that @ @ @ @ @ @ @ than it had in previous months .
But now , because of the coronavirus , that could all change .
Apple temporarily closed some of its more than 40 stores in the country and is currently still operating some under limited hours .
The company said on an earnings call that there has been “ very low customer traffic ” in its stores .
What we can expect Some business analysts are hoping this will only be a temporary disruption that will slow down in the coming weeks — but so far , @ @ @ @ @ @ @ to contain and hard to predict .
The last health crisis to impact trade between China and the rest of the world was SARS in 2003 .
But at that time , the country wasn ’ t as important a player in the global economy as it is today .
The extent to which US-based tech companies are being impacted by the coronavirus demonstrates how reliant the tech industry is on China .

The outbreak of the Covid-19 coronavirus disease has taken the lives of more than 2,770 people — with a vast majority of those deaths in China plus a growing number in countries like South Korea, Iran, and Italy — and infected more than 80,000 as of February 26. As the world scrambles to contain the public health crisis, global businesses are starting to take a hit, particularly in the technology sector.
China — which is the second-largest economy in the world — has all but halted its production of consumer goods such as phones, clothing, and automobiles for the past several weeks. The country has taken on unprecedented “wartime” measures to control the virus’s spread, such as placing severe restrictions on some 780 million people and instituting mass quarantines in major cities.
The Wall Street Journal reports that the lockdown on Chinese manufacturing has caused global markets to “shudder” and is casting an “ever-widening shadow” on the economy at large. That’s particularly relevant in the tech industry, which depends on Chinese labor to build everything from computer chips to cellphone parts. In recent days, China has started reopening its factories (despite public health concerns) in an effort to restart its economy, but manufacturing sites are running at a far lower capacity than usual.
It’s still too early to measure the full financial impact of the virus on the tech industry, but the early signs don’t look good. Technology shares, which had been steadily increasing this year — even during the beginning of the global outbreak — recently took a dive, although they have recovered slightly nearing Wednesday’s NYSE closing. The S&P 500 information technology sector, which analysts use to measure total shares in the tech industry, had fallen by over 9.3 percent from last Thursday’s close compared to a drop of 7.3 percent across sectors, Reuters reported on Tuesday.
Stock markets fluctuate all the time based on a variety of factors, and the coronavirus is impacting stocks across industries, not just tech. But the tech sector’s recent plunge is especially concerning given its recent track record of being resistant to any significant hits, and the fact that the top five major tech companies — Microsoft, Apple, Amazon, Facebook, and Google parent Alphabet — account for a large portion of the total stock market.
Apple — the world’s most valuable tech company — said it is reducing its revenue targets this quarter in a rare company advisory released on Monday. Tesla said last week that “health epidemics” are a risk to its business. Amazon, whose e-commerce business relies on the flow of goods between China, the US, and other countries, has not released any similar warnings but is stockpiling supplier items from China to protect against future disruptions due to the virus. And Chinese companies themselves are feeling the hit, with tech giant Alibaba calling the outbreak a “black swan” event (as in, unpredictable) on a recent earnings call.
Social media companies — which are trying to keep up with a slew of misinformation about the virus’s origins and spread — are still financially less impacted than companies like Apple since their main line of business isn’t selling physical goods. But even Facebook has been affected, setting reduced production goals for its Oculus Quest virtual reality headsets in part due to a slowdown in Chinese manufacturing because of the virus.
And virtually all the major tech companies — Apple, Google, Facebook, Amazon, and Microsoft — have restricted employee travel to China, either banning or limiting it only to matters of critical importance. They’re also asking workers returning from China to work from home for up to two weeks.
In some cases, tech professionals in the US are so concerned about the virus that they’re taking other precautions, such as wearing breathing masks and eliminating handshakes in business meetings, as Recode previously reported. For now, there are only four confirmed cases in the San Francisco Bay Area, but some feel these preventative measures are important given the high volume of travel between China and Silicon Valley — and concerns that the virus could quickly grow out of control given how it has spread in Asia.
Overall, the economic and social impact the coronavirus is having on the tech industry puts into stark relief the close connection between Silicon Valley and China, not just for manufacturing but for supplying a workforce of highly skilled engineers, investor funds, and academic collaboration.
Outside the workplace, tech companies are pulling out of major global conferences or canceling them altogether. As Recode reported last week, Facebook canceled a 5,000-person global marketing conference in San Francisco. And the world’s largest phone trade show, Mobile World Congress, was canceled after major tech companies like Amazon pulled out over coronavirus concerns.
Here are more specifics on some of the main ways we are seeing coronavirus impact the global economy, particularly in the tech industry.
Supply chain disruption
Virtually every major US tech company that builds physical products — like cellphones, computers, or video game consoles — relies on a vast Chinese workforce to manufacture products for cheaper than could be done in the US.
In the past few weeks, though, that supply chain, which includes everything from raw parts to finished products, has been fundamentally disrupted.
Factories in China have been shut down. Hundreds of millions of migrant workers who were visiting family in cities outside the main manufacturing hubs for Chinese New Year were quarantined. Some are beginning to return to work, but reports indicate that as of earlier this week, over two-thirds remain stuck. Roads have been blocked, trains halted, and flights canceled.
In its advisory, Apple said Monday that “worldwide iPhone supply will be temporarily constrained” because its manufacturing sites in China are “experiencing a slower return to normal conditions” than anticipated as manufacturing sites in the region reopen.
The New York Times reports that even though some factories are starting up again, they are still “operating well below capacity.” And there are serious public health concerns about whether reopening the factories is the right decision at all, considering the virus continues to spread in China and elsewhere.
Companies are increasingly talking about the threat of the virus in public business announcements. A MarketWatch report found that out of the S&P 500 companies’ recent earnings calls between January 1 and February 13, 38 percent of transcripts included the term “coronavirus” at least once.
Another major tech company with its supply chain impacted by the virus is Amazon. It’s estimated that more than 40 percent of Amazon sellers are based in China, which means that a large chunk of the products people buy comes from the country. In addition to that, a large portion of US-based sellers source their products from China.
According to a recent Business Insider report, Amazon reached out last week to a number of suppliers for products sold in the US but made in China and encouraged them “to stockpile on certain products shipped from China, in anticipation of potential supply chain slowdowns caused by the coronavirus outbreak in the region,” according to the outlet.
In response to a question about this practice, Amazon sent Recode the following statement: “Out of an abundance of caution, we are working with suppliers to secure additional inventory to ensure we maintain our selection for customers.”
Facebook also said the manufacturing of its Oculus Quest headsets is impacted by the outbreak.
“Oculus Quest has been selling out in some regions due to high demand,” Facebook spokesperson Anthony Harrison wrote in a statement to Recode. “That said, like other companies, we’re expecting some additional impact to our hardware production due to the coronavirus. We’re taking precautions to ensure the safety of our employees, manufacturing partners and customers, and are monitoring the situation closely. We are working to restore availability as soon as possible.”
Chinese demand
Another way the coronavirus outbreak is impacting business is by reducing Chinese consumers’ demand for consumer electronics.
China is the United States’ third-largest and fastest-growing market for exports, which means that US companies are increasingly setting revenue goals that rely on Chinese residents buying their products.
Apple in particular made a whopping $52 billion in sales in the last fiscal year by selling its products (mostly iPhones) in the country. With the recent easing of tensions in the US-China trade war, analysts were anticipating that number to grow at a faster rate than it had in previous months.
But now, because of the coronavirus, that could all change. Apple temporarily closed some of its more than 40 stores in the country and is currently still operating some under limited hours.
The company said on an earnings call that there has been “very low customer traffic” in its stores.
What we can expect
Some business analysts are hoping this will be only a temporary disruption that will slow down in the coming weeks — but so far, the virus has proven to be difficult to contain and hard to predict.
The last health crisis to impact trade between China and the rest of the world was SARS in 2003. But at that time, the country wasn’t as important a player in the global economy as it is today.
The extent to which US-based tech companies are being impacted by the coronavirus demonstrates how reliant the tech industry is on China.


vox--2020-02-21--Alexa records you more often than you think

How often do Alexa and her ilk listen to your conversations ?
Maybe more than you think .
According to a new report from Northeastern University , smart speakers accidentally activate as many as 19 times a day , recording as much as 43 seconds of audio each time .
There ’ s plenty of anecdotal evidence that voice-activated assistants aren ’ t perfect and will wake up accidentally and start recording if they think you ’ ve said their trigger word .
That ’ s not great if you ’ re a privacy-minded smart speaker owner ( this could @ @ @ @ @ @ @ the companies that make these devices hire contractors and employees to listen to small snippets of recordings .
But Northeastern ’ s Mon ( IoT ) r Research Group wanted to quantify for the first time how often these activations happen and what the devices hear when they do .
“ The anecdotes aren ’ t wrong , ” David Choffnes , an associate professor in computer science at Northeastern who worked on the report , told Recode .
Researchers tested five types of speakers : a first-generation Google Home Mini , a @ @ @ @ @ @ @ Harman Kardon Invoke , and the second- and third-generation Amazon Echo Dots .
For the experiment , they forced the speakers to binge-listen to several 125-hour cycles of television shows including Gilmore Girls , The West Wing , Big Bang Theory , and Narcos while they monitored if , when , and how the devices were accidentally triggered .
The good news is they didn ’ t find any evidence that the devices were constantly recording conversations , and about half of the accidental activations lasted less than six seconds .
Here ’ @ @ @ @ @ @ @ of the accidental recordings lasted six seconds or longer , with some recording as much as 43 seconds of audio without the hypothetical user ’ s permission or , possibly , knowledge .
Choffnes said these long activations were rare , but they did happen .
That said , the test environment did not fully replicate the environment in which these speakers are used ; the audio comes from television show dialogue , which is not always representative of how humans talk .
The audio also comes from a speaker rather than a @ @ @ @ @ @ @ ’ actions aren ’ t necessarily representative of a real-life situation .
As you can guess , the devices were usually activated when a word similar to the trigger word was spoken : “ I can work ” instead of “ OK Google , ” “ congresswoman ” instead of “ Alexa , ” “ he clearly ” instead of “ Siri , ” and “ Colorado ” instead of “ Cortana.
” While some speakers were better than others , they were all prone to accidental activations , ranging from an average @ @ @ @ @ @ @ .
The Apple and Microsoft devices activated more often than the others .
While this study ’ s findings are recent , the news that these speakers can be activated accidentally and record random conversations is not .
If you have a smart speaker in your house , it has surely happened to you .
What you might not know is that , intentional activation or not , the recordings are kept on servers and may even be reviewed by human ears .
Sounds creepy , but there is a reason : The @ @ @ @ @ @ @ accidental activations , the better they can refine their voice recognition software to prevent them .
Apple , Google , Amazon , and Microsoft all do this .
The human listeners are not told who they are listening to , but they might hear enough details to connect a voice to a specific person .
The report is part of a still-in-progress larger study , which will also look into what happens to all the data these voice-activated assistants collect .
Choffnes hopes consumers will feel more informed and better able to decide @ @ @ @ @ @ @ comes with voice-activated devices is worth the reward .
And that ’ s assuming consumers even have that option at all .
As he points out , it ’ s increasingly impossible to avoid smart devices , and he doesn ’ t think the burden should be on consumers to do so in the first place .
“ They should not be the ones making these decisions , ” Choffnes said .
“ Ultimately , we should actually have regulations to enforce good behavior in terms of protecting personal data.
” By now @ @ @ @ @ @ @ are hearing .
As it happens , you might be able to hear the recordings for yourself — and delete them and stop others from listening in .
Here ’ s how to take control of your favorite voice assistants .
Amazon gives you the ability to hear your recordings .
The instructions are here .
You might even get someone else ’ s recordings , which happened to one man in Germany .
You ’ ll also see how to delete those recordings and opt out of having your audio recordings reviewed @ @ @ @ @ @ @ that , why not give those recordings a listen and tell us what you heard ?
Google also lets you review your recordings and delete them if you ’ re so inclined ( but first please drop us a line and tell us about it ) .
Your recordings won ’ t be reviewed by humans unless you approve it .
Google also says that , yes , it may use the things you say when it ’ s activated to target ads to you .
Click here to access Google ’ s @ @ @ @ @ @ @ ( and turn off “ ad personalization ” to opt out of the targeted ads ) .
You can opt out of having your interactions with Apple ’ s Siri stored and reviewed through your device ’ s settings and you can delete recordings ; instructions are here .
Apple does not appear to give users the option to review their recordings .
You can review recordings from Microsoft devices through its privacy dashboard ( we ’ d love to know if you do ) , and there are instructions on how to @ @ @ @ @ @ @ .
Microsoft ’ s privacy policy doesn ’ t say whether it lets users opt out of having their recordings stored or reviewed .
Has your smart speaker accidentally recorded something you didn ’ t intend to be recorded ?
We want to hear what happened !
Just fill out this Google form to share your experience .
Open Sourced is made possible by Omidyar Network .
All Open Sourced content is editorially independent and produced by our journalists .

How often do Alexa and her ilk listen to your conversations? Maybe more than you think. According to a new report from Northeastern University, smart speakers accidentally activate as many as 19 times a day, recording as much as 43 seconds of audio each time.
There’s plenty of anecdotal evidence that voice-activated assistants aren’t perfect and will wake up accidentally and start recording if they think you’ve said their trigger word. That’s not great if you’re a privacy-minded smart speaker owner (this could be an oxymoron), especially since the companies that make these devices hire contractors and employees to listen to small snippets of recordings. But Northeastern’s Mon(IoT)r Research Group wanted to quantify for the first time how often these activations happen and what the devices hear when they do.
“The anecdotes aren’t wrong,” David Choffnes, an associate professor in computer science at Northeastern who worked on the report, told Recode.
Researchers tested five types of speakers: a first-generation Google Home Mini, a first-generation Apple HomePod, Microsoft’s Harman Kardon Invoke, and the second- and third-generation Amazon Echo Dots. For the experiment, they forced the speakers to binge-listen to several 125-hour cycles of television shows including Gilmore Girls, The West Wing, Big Bang Theory, and Narcos while they monitored if, when, and how the devices were accidentally triggered.
The good news is they didn’t find any evidence that the devices were constantly recording conversations, and about half of the accidental activations lasted less than six seconds.
Here’s the bad news: About half of the accidental recordings lasted six seconds or longer, with some recording as much as 43 seconds of audio without the hypothetical user’s permission or, possibly, knowledge. Choffnes said these long activations were rare, but they did happen.
That said, the test environment did not fully replicate the environment in which these speakers are used; the audio comes from television show dialogue, which is not always representative of how humans talk. The audio also comes from a speaker rather than a human mouth, so the voice assistants’ actions aren’t necessarily representative of a real-life situation.
As you can guess, the devices were usually activated when a word similar to the trigger word was spoken: “I can work” instead of “OK Google,” “congresswoman” instead of “Alexa,” “he clearly” instead of “Siri,” and “Colorado” instead of “Cortana.” While some speakers were better than others, they were all prone to accidental activations, ranging from an average of 1.5 to 19 times per day. The Apple and Microsoft devices activated more often than the others.
While this study’s findings are recent, the news that these speakers can be activated accidentally and record random conversations is not. If you have a smart speaker in your house, it has surely happened to you.
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What you might not know is that, intentional activation or not, the recordings are kept on servers and may even be reviewed by human ears. Sounds creepy, but there is a reason: The more data providers get about things like accidental activations, the better they can refine their voice recognition software to prevent them. Apple, Google, Amazon, and Microsoft all do this. The human listeners are not told who they are listening to, but they might hear enough details to connect a voice to a specific person.
The report is part of a still-in-progress larger study, which will also look into what happens to all the data these voice-activated assistants collect. Choffnes hopes consumers will feel more informed and better able to decide for themselves if the privacy risk that comes with voice-activated devices is worth the reward. And that’s assuming consumers even have that option at all. As he points out, it’s increasingly impossible to avoid smart devices, and he doesn’t think the burden should be on consumers to do so in the first place.
“They should not be the ones making these decisions,” Choffnes said. “Ultimately, we should actually have regulations to enforce good behavior in terms of protecting personal data.”
By now you must be wondering what your devices are hearing. As it happens, you might be able to hear the recordings for yourself — and delete them and stop others from listening in. Here’s how to take control of your favorite voice assistants.
Amazon’s Alexa/Echo
Amazon gives you the ability to hear your recordings. The instructions are here. You might even get someone else’s recordings, which happened to one man in Germany. You’ll also see how to delete those recordings and opt out of having your audio recordings reviewed by humans. But before you do that, why not give those recordings a listen and tell us what you heard?
Google Home
Google also lets you review your recordings and delete them if you’re so inclined (but first please drop us a line and tell us about it). Your recordings won’t be reviewed by humans unless you approve it. Google also says that, yes, it may use the things you say when it’s activated to target ads to you. Click here to access Google’s privacy controls to review and delete recordings (and turn off “ad personalization” to opt out of the targeted ads).
Apple’s Siri
You can opt out of having your interactions with Apple’s Siri stored and reviewed through your device’s settings and you can delete recordings; instructions are here. Apple does not appear to give users the option to review their recordings.
Microsoft’s Cortana
You can review recordings from Microsoft devices through its privacy dashboard (we’d love to know if you do), and there are instructions on how to delete your voice data from the service. Microsoft’s privacy policy doesn’t say whether it lets users opt out of having their recordings stored or reviewed.
Help Open Sourced’s reporting
Has your smart speaker accidentally recorded something you didn’t intend to be recorded? We want to hear what happened! Just fill out this Google form to share your experience.
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Open Sourced is made possible by Omidyar Network. All Open Sourced content is editorially independent and produced by our journalists.