Kevin Drum

The New York Times writes today about greedflation:

PepsiCo has become a prime example of how large corporations have countered increased costs, and then some.

Hugh Johnston, the company’s chief financial officer, said in February that PepsiCo had raised its prices by enough to buffer further cost pressures in 2023. At the end of April, the company reported that it had raised the average price across its snacks and beverages by 16 percent in the first three months of the year. That added to a similar price increase in the fourth quarter of 2022 and increased its profit margin.

It's become common among large corporations to raise prices far in excess of inflation simply because they can. But why can they?

David Beckworth, a senior research fellow at the right-leaning Mercatus Center at George Mason University and a former economist for the Treasury Department, said he was skeptical that the rapid pace of price increases was “profit-led.”...Mr. Beckworth and others contend that those higher prices wouldn’t have been possible if people weren’t willing or able to spend more.

....“It seems to me that many telling the profit story forget that households have to actually spend money for the story to hold,” Mr. Beckworth said. “And once you look at the huge surge in spending, it becomes inescapable to me where the causality lies.”

So has there been a surge in household spending? That depends a bit on how you look at it:

On the one hand, it's true that personal spending, even adjusted for inflation, has increased a lot since the start of the pandemic. Spending today is $2,500 higher than it was at the start of 2020.

On the other hand, there's nothing unusual about this. Spending has just followed its usual trendline.

But trendline or no, this suggests that Beckworth is on to something. It's one thing to wantonly raise prices above the level of inflation in search of windfall profits, but you can only do it if consumers don't push back—and if they don't push back then you might as well charge all that the market can bear. And right now it looks like people are spending money freely enough that the market can bear quite a bit.

Traffic jam at the bird feeder in the late afternoon.

We all know that abortion rights tend to be popular at a nationwide level—even more so following the Dobbs decision. Most polling suggests that around 60% of Americans think abortion should be legal all or most of the time.

But nationwide doesn't matter since Dobbs made abortion a state matter. Abortion is now banned, or mostly banned, in a dozen states throughout the South plus a handful elsewhere.

But are abortion bans popular even in these states? This is where things get curious. We don't have a lot of state polling, but we do have one comprehensive poll: a survey of all 50 states done in February by PRRI. Here's what it looks like:

I can't say for sure how reliable these numbers are, but they sure seem to suggest that abortion bans are not especially popular even in deep red states. In only four states is there even a bare majority that thinks abortion should be banned all or most of the time.

Other states are even weaker. In Texas, one of the most aggressive states to ban abortion, only 40% of residents think abortion should be illegal all or most of the time. In Florida it's only 33%. No wonder Ron DeSantis dithers so much about acknowledging the abortion restrictions he signed into law.

In all of these states there are conservative Republican majorities against abortion, and obviously that's the only thing extremist Republican legislators care about. Nevertheless, this polling explains why pro-abortion referendums often succeed even in red states: when everyone votes, they have pretty clear majority support. It's only when the zealots can ignore half their constituents that abortion bans have a chance. Unfortunately, history suggests they can keep ignoring them for a good long while.

The Wall Street Journal has an inexplicably fascinating story about gambling in Las Vegas today. I've long been accustomed to hearing about microscopic changes in gambling rules to favor either the house or (via negotiation) high rollers, but now casinos have thrown all their subtlety out the window. For example, if you hit 21 on your first two cards in blackjack, it used to pay $15 on a $10 bet. Now it pays only $12. Roulette wheels used to have two green slots, zero and double-zero, that paid out nothing. Now they have a third slot, triple-zero, that also pays out nothing.

In the delicately balanced world of big-time gambling these are huge changes—and they're obviously right out in the open. How can casinos get away with fleecing regular customers like this?

The answer appears to be simple: they don't care. Gambling in Vegas is up a whopping 25% since the pandemic ended and casinos are stuffed to the gills. They can reduce payouts as much as they want and they'll still have thousands of punters jockeying for a place at the tables.

Life is good when you have so much business you can barely handle it. And when it comes to blowing off steam after the pandemic, apparently Vegas was firstest with the mostest.

Today really is the start of the French Open, so here's a pair of pictures of Court Simonne Mathieu, the newest of the courts at Roland Garros. As you can see in the top picture, it's a sunken court. The entrance leads to the top level, not the bottom. The bottom picture shows the court itself, all of it below surface level.

An op-ed in the New York Times today caught my eye: "The Real Reason Your Groceries Are Getting So Expensive." This got me curious: are groceries getting more expensive? I haven't checked for a while. Here's the answer:

Food inflation peaked in early 2022 but it's been plummeting since then. Groceries are still more expensive than they were a year ago, but on a month-over-month basis we're actually starting to see some deflation in food prices. For the past couple of months, groceries have been getting cheaper, not more expensive.

Now, the op-ed that caught my eye is more about long-term antitrust policy and the effect it's had on smallish food chains, not the latest inflation numbers. So there's a bit of apples and oranges here. Still, for the moment anyway, grocery prices are pretty clearly on a significant downturn.

Just as a minor historical note about the debt ceiling, it has been killed off before—for nearly 15 years. Dick Gephardt did it in 1979:

He consulted the parliamentarian. "I asked if there was a way that when we pass the budget [the debt ceiling] can be deemed 'raised' to accommodate the budget people are voting for," Gephardt said. "He said, 'Yeah, we think we can work that out.'"

Thus was born the "Gephardt rule." For a period thereafter, the adoption of the conference report on the budget resolution would trigger the Gephardt rule and "deem to have passed" legislation raising the debt limit to accommodate the spending and revenue levels approved in the budget. Presto! Problem solved.

Unfortunately, anything that can be legislated can also be unlegislated. When Democrats lost their majority in the Gingrich landslide of 1994 the Gephardt rule was quickly abolished. Republican revolutionaries wanted the debt ceiling back as leverage to force spending cuts—including two government shutdowns—on President Clinton. It's been with us ever since.

A new study of online news in 2020 has produced some dramatic—if unsurprising—results about consumption of misinformation between conservatives and liberals. It's a little complicated so I've split it into multiple simpler charts. Here's the first one:

The top set of points shows raw exposure: it's what Google shows you when you perform a search. As you can see, it's about the same for everyone.

The middle set of points shows what users actively choose to follow. This is not the same for everyone: Republicans choose to follow much more partisan news than anyone else.

The bottom set of points shows overall engagement and is even more dramatic. Republicans are far more likely to actively engage with partisan news than either Democrats or Independents.

The next chart shows how this shakes out in a measure of unreliable news:

Among Republicans, high engagement goes hand-in-hand with unreliability. The result is this:

As before, the top set of lines is merely what Google initially presents. There's little difference between partisans. But the bottom set of lines shows what people actively engage with, and the differences could hardly be more stark. Republicans freely choose to engage with far more unreliable news than anyone else. They crave it and they seek it out, even when the original search produces perfectly reasonable results.

I showed the results here only for the 2020 wave of data, but the authors performed the same analysis in 2018 with much the same results:

The two waves of our study replicate the same finding: engagement outweighs exposure to partisan and unreliable news within Google Search....Our results highlight the role of user choice, rather than algorithmic curation, in driving such effects

Conservatives don't get passively fed misinformation. They choose it, eyes wide open. They want to believe lies and conspiracy theories from people like Donald Trump, and after they "do their research" the comforting lies are all that's left.

But what is it that makes the endless lies so comforting?

I don't have any special reason for posting this. It just seems like something we should all be reminded of from time to time.

Texas Attorney General Ken Paxton is almost comically corrupt. He's been under federal indictment for securities fraud since 2015. In 2020 whistleblowers accused him of abusing his office to help a wealthy donor. Last year he requested state funds to pay off the whistleblowers, who had accused him of retaliating against them:

Among the allegations were that Mr. Paxton gave special treatment and abused his office to help Nate Paul, a friend and campaign donor in Austin, in several instances. Lawmakers also said that Mr. Paul helped with renovations on Mr. Paxton’s home and employed a woman with whom Mr. Paxton had been having an affair, actions that amount to bribes in the eyes of Mr. Paxton’s critics.

The impeachment articles also include claims that Mr. Paxton directed his employees to violate the state’s open records law, fired employees who reported his bad behavior, made false statements to a state board, did not accurately disclose his finances and stalled a separate criminal prosecution that accused him of securities fraud.

Here's what I don't get. This stuff has been going on for years. Everyone knew about it because it's been all over the front pages. Paxton's corruption is all but an open record, but he's maintained his political support anyway.

So why now? Out of the blue he's hit with impeachment and the vote against him is overwhelming, 121-23. A special Senate session to vote on conviction will be called within days or weeks.

What happened? Why did the dam break so suddenly? Is there more going on behind the scenes than we know about?