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March 27, 2014

Yesterday, a new one-and-a-half-minute economics video from Ezra Klein's newly formed Vox Media hit the internet. In it, Vox Executive Editor Matt Yglesias explained why the current level of the national debt is neither dangerous nor worrying:

He concludes that "debt just isn't a problem right now," because inflation is currently near historic-lows.

The video stirred up some pretty angry responses from people who think that debt is a problem right now. Red State's Erick Erickson claims some of the video is incorrect and calls Yglesias a liar who is spreading "left-wing propaganda."

Erickson contends that: "[Yglesias] tries to explain the National Debt and out of the gate begins with a lie. He claims the national debt is $5 trillion less than the U.S. Treasury says it is."

But Yglesias is pretty clear that he's excluding debt owed from one arm of the government to another, and only including federal debt held by the public. That is completely rational. After all, money the government owes to itself is simply money moved from one side of the government balance sheet to the other. There's nothing dishonest or disingenuous about citing the lower figure that only includes debt held by the public, especially given that Yglesias was clear about this.

Erickson then contends that: "[Yglesias] uses deficit and debt interchangeably."

But the debt is just the sum of the deficit over many years. So there's nothing wrong with treating them as two manifestations of the same thing so long as you understand that one is an annual figure and the other is the total. Yglesias' point is that the reason to worry about deficits is when they lead to elevated inflation and interest rates, something which we are not currently experiencing. This bases the assessment of debt and deficits around the real world consequences of debt and deficits, instead of hand-wringing over the size of the number, which seems to be what Erickson would rather have us do.

Erickson's next point is that: "[Yglesias] claims the U.S. government can never run out of money."

This, of course, is true. The U.S. government is a monetary sovereign that controls its own state-backed fiat money. Does Erickson think this is untrue? Does he think that the U.S. government can run out of paper and electronic dollars? Does Erickson think that the U.S. is back on the gold standard and therefore can run out of money?

Erickson concludes: "This isn't education. It is not explaining. It is left-wing propaganda. It is also sponsored by General Electric. Why is General Electric sponsoring left-wing propaganda?"

Now, to be fair, I'm not sure Yglesias' video will change many minds. It crams in a baffling quantity of information into a relatively short period. Viewers might on first viewing find it more confusing than enlightening, especially given that the mainstream narrative of the terribleness of government debt and deficits has become so deeply ingrained as "common knowledge."

But everything in the video is technically correct. At the very least it has succeeded in sparking a public debate on the issue of the national debt. And it is very definitely not left-wing propaganda, no matter how much Erick Erickson and other debt fearmongers would like it to be. John Aziz

7:53 a.m. ET

First Lady Melania Trump has backed out of plans to accompany her husband to the World Economic Forum in Davos, Switzerland, where he is scheduled to speak on Friday, CNN reports. East Wing communications director Stephanie Grisham said the decision was made due to "scheduling and logistical issues," although the first lady's absence is nevertheless raising eyebrows as it follows reports that President Trump's lawyer supposedly paid adult film star Stormy Daniels $130,000 to keep quiet about an alleged affair with Trump in 2006.

The Trumps did spend the long weekend of Martin Luther King, Jr. Day together in Mar-a-Lago, although Melania Trump was absent from dinners hosted by the president, The Independent reports. Trump's own trip across the Atlantic had been delayed due to the government shutdown, although White House Press Secretary Sarah Huckabee Sanders confirmed Monday that the U.S. delegation "will leave tomorrow" for Davos, with Trump himself following "later in the week."

A recent poll by The Economist/YouGov found that 48 percent of Americans have a favorable opinion of Melania Trump, making her the most-liked member of the president's family. Jeva Lange

5:52 a.m. ET

A magnitude 7.9 earthquake off the coast of Alaska early Tuesday prompted NOAA's U.S. Tsunami Warning System to issue a tsunami warning for parts of Alaska and all of coastal British Columbia, and put the entire U.S. West Coast and Hawaii on tsunami watch. The earthquake struck 157 miles southeast of Chiniak, Alaska, at about 3:30 a.m. Alaska Standard Time (9:31 a.m. GMT), the U.S. Geological Survey said, and the National Weather Service (NWS) issued this map estimating when the tsunami would hit various areas. The NWS's Los Angeles office estimated that the tsunami would hit southwest California between 6 a.m. and 7 a.m. local time.

People who live in coastal Alaska and British Columbia should "move inland to higher ground," the Anchorage Office of Emergency Management said. "Tsunami warnings mean that a tsunami with significant inundation is possible or is already occurring." The Pacific Tsunami Warning Center said that, "based on all available data a tsunami may have been generated by this earthquake that could be destructive on coastal areas even far from the epicenter." Japan's meteorological agency did not issue a tsunami alert but said it is monitoring the situation, Reuters reports. Peter Weber

Update 7:35 a.m. ET: The tsunami warnings and other alerts have now been canceled for Alaska, British Columbia, and the U.S. West Coast after "additional information and analysis have better defined the threat."

5:20 a.m. ET
Jack Taylor/Getty Images

On Tuesday, Britain's top competition regulator, the Competition and Markets Authority (CMA), provisionally rejected 21st Century Fox's bid to buy the 61 percent of satellite broadcaster Sky because it is "not in the public interest." The CMA was looking at two questions — would the proposed merger lower broadcasting standards in Britain and would it give Rupert Murdoch and his family too much control over British media and opinion; it said no to the first question and yes to the second. Sky, owner of Sky News, and Fox will respond to CMA's objections and proposed workarounds, and Culture Secretary Matt Hancock will make the final decision by the middle of May.

Murdoch has been trying for years to purchase full control of Sky, which he launched in the early 1990s, and in December 2016 he made a $16.3 billion offer. But the CMA noted that the Murdoch Family Trust controls news outlets watched or read b nearly a third of the U.K.'s population. "Media plurality goes to the heart of our democratic process," Anne Lambert, chairwoman of the CMA's independent investigation group, told BBC News. "It is very important that no group or individual should have too much control of our news media or too much power to affect the political agenda."

The CMA said that to mitigate its media plurality concerns, 21st Century Fox could call off the deal, sell or divest Sky News, or put in place "behavioral remedies" to wall off Sky News from Murdoch Family Trust interference. Murdoch's sale of most 21st Century Fox assets to the Walt Disney Co., if completed, could also mitigate those concerns. Peter Weber

4:28 a.m. ET

Stephen Colbert began Monday's Late Show by congratulating his American viewers on having a government — at least until Feb. 8. Senate Democrats agreed to re-open the government for three weeks in exchange for a 6-year extension of the Children's Health Insurance Program (CHIP) and a promise from Majority Leader Mitch McConnell (R-Ky.) to hold a vote to protect DREAMers. That's a bum deal, Colbert said. "Mitch McConnell has proved he will lie to anyone about anything," but "here we are. To avoid another shutdown, all that needs to happen is that Congress has to agree on how to fix our entire immigration system in 17 days — and once they do that, the pigs that fly out of all their butts will solve world hunger."

President Trump isn't helping create the environment for such magic to bloom, Colbert said, recapping his more over-the-top attacks on Democrats over the weekend and his gloating on Monday about how Democrats "caved." "Wait a second, there's a cave?" Colbert asked. "Can we all fit in there? Is there enough food and water for the next three years?"

Trump spent the shutdown weekend tweeting about watching Fox News and "working hard!" — in the same tweet — when he really wanted to be at his anniversary gala at Mar-a-Lago. "Because McConnell couldn't get the votes, Trump had to miss his party — which seems fair," Colbert said. "Republicans ruin Trump's party and Trump is ruining the Republican Party." Since Trump was stuck in D.C. wandering "around the White House like a cranky Roomba," he sent Eric Trump in his place — not a good deal for his $100,000-a-couple ticket holders, Colbert said. The guests had other concerns, though, with one griping about the caviar silverware and accompaniments. "I can't believe I'm saying this," Colbert said, "but Donald Trump might not be the worst person at Mar-a-Lago." Watch below. Peter Weber

3:36 a.m. ET
Saul Loeb/AFP/Getty Images

Before the Senate passed a three-week stopgap measure to fund the government on Monday, the Republican chairman and top Democrat on the Senate Intelligence Committee unsuccessfully tried to remove a measure inserted by House appropriators at the request of the White House. "The language is troublesome for the committee because it would authorize the intelligence community to spend funds notwithstanding the law that requires prior authorization," Sen. Richard Burr (R-N.C.), the chairman, said on the Senate floor. "Effectively, the intelligence community could expend funds as it sees fit."

"If this exemption is granted, you could potentially have an administration — any administration — go off and take on covert activities, for example, with no ability for our committee, which spends the time and has oversight, to say 'time out,'" warned Sen. Mark Warner (Va.), the ranking Democrat. "We just want to make sure that we don't give a blank check to any administration, particularly this administration. We need to get it fixed."

Burr proposed an amendment that would replace the provision in question — which says funds may be spent "notwithstanding" Section 504 of a 1947 law that prevents intelligence agencies from spending money without congressional authorization — with one that requires such authorization. Sen. Thad Cochran (R-Miss.), the chairman of the Senate Appropriations Committee, objected, scuttling the amendment. Jennifer Hing, a spokeswoman for the House Appropriations Committee, said the language was narrowly tailored to a Pentagon budget request and isn't a black check for intelligence activities. Burr said he and Warner will work to quash the measure in the next spending bill, by Feb. 8.

President Trump signed the stopgap funding package Monday night, re-opening the federal government. Peter Weber

2:38 a.m. ET
Frederic J. Brown/AFP/Getty Images

Bank of America, the second-largest U.S. bank by assets, just finished switching all customers who used a free online-only checking account to to checking accounts that charge customers a $12 monthly fee if they don't maintain a minimum daily balance of $1,500 or a monthly direct deposit of at least $250, The Wall Street Journal reports. The eBanking accounts were popular with freelancers and people with low incomes, and a petition protesting Bank of America's shuttering of the accounts has drawn more than 45,000 signatures at Change.org.

Bank of America introduced the eBanking accounts in 2010 as a way to encourage customers to bank online; account holders were charged $8.95 a month only if they used a live bank teller for a routine transaction. It stopped offering the eBanking option to new customers in 2013 and began switching customers out of the accounts in 2015. "Banks have long grappled with how to charge customers for basic checking services," the Journal notes. "The accounts are costly for banks to maintain, though they do bring in revenue through overdraft and other fees."

Bank of America CEO Brian Moynihan, who has led the bank since late 2009, has reduced the company's consumer options and cut its branch network, pulling out of less-lucrative rural areas to focus on denser urban centers. Bank of America's share price has risen in response. Peter Weber

2:21 a.m. ET

The mourners gathered as close to the scene as possible, their stomachs empty but hearts full, remembering the chalupas and gorditas they once enjoyed inside the burned-down Taco Bell, now just an empty shell.

It started as a joke — holding a candlelight vigil for the Taco Bell on Zelda Road in Montgomery, Alabama, that was destroyed in a fire last Wednesday — but as word spread, the Taco Bell lovers realized that they actually would miss being able to pop over for a Doritos Locos taco whenever a craving hit. No one was hurt in the fire, which officials say started in a room that held electrical equipment, and the owners have already vowed to rebuild, making the candlelight vigil a celebration as well.

About 100 people showed up for the event, which had to take place in the parking lot of the Arby's next door for safety reasons. Fans who couldn't make it to the actual vigil shared their heartfelt memories on Facebook, including Shaw Gibbons, who said the Taco Bell was there when all other fast food restaurants had forsaken him. "When McDonalds failed me, you lifted me up," he wrote. "When Sonic was closed, you filled my cup. When Arby's went dark, you made me smile. Your quesadillas sustained me mile after mile." Catherine Garcia

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