If you are really interested in debates over out-year budget deficits, last night’s presidential press conference was a gas from beginning to end, with reporters putting on their green eyeshades and clucking over ten-year debt and deficit forecasts, and Obama answering with polite variations on the theme: “You don’t get it.”
But in the eyes of the news media itself, the big news probably wasn’t how the president answered questions, but who got to ask them. Here’s how Michael Calderone of Politico summed it up:

[I]n quite a departure from the first presser — and White House protocol — Obama skipped over the nation’s top newspapers. Indeed, there were no questions from the NY Times, Washington Post, Wall Street Journal or USA Today. That might not sit well with the already insecure newspaper industry.
In exchange, Obama opened things up to a wider variety of outlets, including Spanish-language television, a military news outlet, and black-oriented media. It’s another example of the White House going over the typical Washington press corps “filter.”

Calderone didn’t specifically mention the joy that probably broke out at Politico itself when its own reporter, Mike Allen, was called on by the president, while the Washington Post, where many Politico staffers used to work, didn’t get the Big Nod for prime-time TV exposure.
That makes two-for-two for defiance of ancient press protocol canons in Obama’s prime-time presidential press conferences. In the first one last month, the president created a buzz by calling on Sam Stein of Huffington Post. Oh my God, you could almost hear reporters think, calling on a blogger at a presidential press conference!
In taking this approach, it’s not as though Obama is trying to dodge tough questions or hostile reporters. Fox and the Washington Times were among the organizations whose reporters were selected for a question last night. Moreoever, the president routinely allowed follow-up questions, which most politicians just as routinely refuse to do, since they (a) reduce the amount of time available to spread the press-love around, and (b) are generally designed to expose evasions of initial questions.
I really don’t think there’s any overt strategy of exclusion or inclusion going on in Obama’s press conferences, to this point. But it is clear he and his staff aren’t particularly interested in observing traditions of press entitlement that lost whatever rationale they ever had many years ago. I’m sure some Washington observers were annoyed that time was “wasted” in questions from “ethnic media” like Univision and Ebony. But the questions–about the Mexican “border war” and about homelessness–were actually a refreshing break from the relentless effort to provoke a presidential gaffe on the budget or AIG.
In general, Team Obama’s approach to media relations is more a reflection than a cause of social, technological and economic changes in media usage and the consequent reportorial pecking order. But it’s interesting to see these changes play out in one of the hoariest, most tradition-laden venues this side of the British House of Lords, the presidential press conference.

For anyone focused on the climate change challenge, or for that matter, the long-overdue task of transforming America’s energy sector, the last few days have been painful, as signals emerge from Washington that congressional action this year on carbon limits–the hinge on which all other climate change efforts depends–is unlikely.
This bad news first arose from a report by ABC’s George Stephanopolis last week that the Obama administration had decided tentatively to move (or at least threaten to move) health care reform, but not its signature carbon cap-and-trade proposal, via the budget reconciliation route. The decision itself was likely forced when eight Senate Democrats signed onto a Republican letter to the Budget Committee opposing the inclusion of cap-and-trade in any budget reconciliation package.
As the perpetual gridlock over earlier cap-and-trade bills in Congress would indicate, a proposal without the protection of a reconciliation package–which cannot be filibustered–is unlikely to survive the Senate without being fatally watered down.
Moreover, as TDS Co-Editor Bill Galston explains at TNR today, there are other adverse developments that make action on cap-and-trade this year very problematic. For one thing, polls are showing new strength for the old Republican talking point that we can’t afford environmental progress in a bad economy. And for another, regional factionalism on energy policy hasn’t gone away, as evidenced by the above-mentioned senatorial letter to the Budget Committee: of the eight Democrats signing on, seven are from energy-producing states, and the eighth is from auto-producing Michigan.
But as Galston also points out, the consequences of inaction this year are more concrete and immediate than another delay in dealing with the ever-ticking clock of climate change. For one thing, cap-and-trade is a revenue raiser, and if it’s not included in the budget package, the administration will have to find some other way to pay for the president’s politically crucial Make Work Pay tax credit, his major tax cut for middle-class families. And for another, the long-awaited resumption of international climate change negotiations, which the Bush administration worked so hard to torpedo, is due to occur in December in Copenhagen, and it would be very helpful if the United States showed up with a policy accomplishment in hand.
There remains, of course, a sort of “nuclear option” for enacting carbon limits: regulatory action by EPA under the aegis of the Clean Air Act, a path made available by a 2007 Supreme Court decision. As Kate Sheppard of Gristmill reported yesterday, EPA has just taken an important procedural step–a finding that climate change endangers the public welfare–in that direction. It’s more likely, suggests Sheppard, that the administration will use that option as leverage to force Congress to deal with the subject itself. But it may have to wait until next year.

I will beg regular readers to forgive my redundancy on this subject. But so long as Republicans continue to shriek about the possible use of budget reconciliation procedures for health care and/or climate change legislation as though this represented some sort of revolutionary new technique for sneaking legislation through Congress, I will ocassionally issue reminders that reconciliation in its current form was largely the creation of the sainted Ronald Reagan.
You wouldn’t know that from watching an exchange between Sean Hannity and Mike Huckabee on Fox late last week, wherein the duo acted like they’d never heard of reconciliation until it was spawned by the devilish socialists of the Obama administration:

HANNITY: [T]he Congress now along with the White House is looking now to use a parliamentary procedure called reconciliation as a means of passing their health-care reform, their tax increases, their extreme cap and trade, their energy policies. Now, that would mean that they pass all of these things without any Republicans even having an opportunity to vote. How dangerous do you think that is?
HUCKABEE: It’s horribly dangerous because it really does bypass the entire system of the American government, where we’re supposed to have an honest debate.

Aside from the fact that the “Republicans can’t vote” assertion is nonsense (at most reconciliation means that Republicans can’t filibuster), Hannity and Huckabee surely know that reconciliation as we know it–as a vehicle for large packages of legislation that don’t simply alter funding levels–was largely invented by Reagan OMB director David Stockman as the means of enacting Ronald Reagan’s entire agenda in 1981.
In the original Congressional Budget Act of 1974, “reconciliation” was an enforcement measure attached to the end of the budget process as a means of forcing rebellious authorizing or appropriations committees to remain within the bounds of the congressional budget resolution. In 1980, however, the procedure was changed allowing “reconciliation instructions” to be included at the front end of the process, to avoid time delays and to anticipate disputes. Only in 1981 did this “front-end reconciliation” become something very different: a fast-track measure to enact very specific changes in in a vast array of federal laws that happened to accomplish budget resolution revenue and spending targets. It was a giant tail wagging the dog of budget levels.
The audacious use of reconciliation by the Reagan administration in 1981 didn’t end there, however. Once the reconciliation bill emerged from the committee system and came to the House floor for a vote, the administration’s congressional allies, unhappy with some of the details, offered a comprehensive floor substitute, labeled Gramm-Latta II, that essentially enacted a couple of years’ worth of legislation in one bill that virtually nobody had read. (The bill as enacted included lunch orders and lobbyists’ phone numbers scribbled by staffers in the margins of the text). And hardly any significant federal program avoided a major re-write of its authorizing langage in ways that reshaped the federal government and its relationship with state and localities, businesses, and individuals in a sweeping array of areas.
While nothing will ever match the breath-taking chutzpah of Gramm-Latta II, short of an actual dictatorship (the so-called Byrd Rule did subsequently place some limits on fast-track enactment of legislation that has little or nothing to do with spending or revenue levels), reconciliation has been regularly used to package and enact major legislation in the ensuing years. Examples included the first Clinton budget package of 1993, the first Gingrich budget package (twice vetoed by Clinton until a final compromise was worked out) in 1995, the Balanced Budget Act of 1997, and the Bush tax cuts of 2001, among others. All of these bills included major policy changes that were remote from the task of simply laying out a federal budget or changing spending or revenue levels.
It may ultimately turn out that the Obama administration and congressional Democrats will decide to move some parts of the president’s agenda, including health care and/or climate change legislation, outside the reconciliation process, to make changes that might run afoul of the Byrd Rule or to encourage some bipartisan support. But those whose alpha and omega in politics and policy is Ronald Reagan really do need to acknowledge that their hero created this particular tool for majority rule in Congress.

After a slow rollout over the last few days, the administration’s bank rescue plan has been released, to very mixed reviews. And this time, skepticism if not hostility has spread pretty deeply into the progressive ranks.
Brad DeLong offers a pretty clear explanation, and a relatively positive take. Paul Krugman expresses “despair,” and says it’s just another rehash of the Paulson Plan.
(Meanwhile, international markets responded positively to advance reports over the weekend, and stocks–particularly for banks–rose sharply on Wall Street this morning.)
There’s an important anomaly to note in the freetings over progressives over this plan. Most of those reacting negatively favor a “temporary takeover” or “nationalization” of financial institutions. But even in this camp, there’s a widespread assumption that a failure of the current plan will drive Congress in the opposite direction, towards a neo-Hooverian obsession with deficit reduction and suspension of any further public investments. Since Republicans are already pretty much down with the Herbert Hoover approach, that means a significant faction of congressional Democrats would move not towards a more aggressive approach to freeing up credit, but towards the Republicans.
Indeed, some nationalization proponents seem to think the public will move that way too, out of anger towards never-ending public subsidies of banks and other failed enterprises. In other words, one highly influential progressive point of view is that the administration must move sharply “left” or its policies will likely produce a sharp move to the “right” in Congress and around the country–led by enough congressional Democrats to thwart the administration’s designs.
If nothing else, it seems to be clear that Democrats as a whole control their own destiny. The question is which Democrats will be in a position to lead one way or another once the dust has settled.
UPCATEGORY: Democratic Strategist

Today’s Wall Street Journal features a novel conservative argument about comparisons between Barack Obama and FDR. The standard fare is that everybody knows FDR failed to do much about the Great Depression, which was actually ended by World War II (never mind the contradiction between claims that stimulating demand through government spending always fail–except when that stimulus is via the Department of Defense!).
But George Bittlingmayer and Thomas W. Hazlitt, two conservative academics, have taken a different tack: FDR’s 100 Days policy blitz, which focused on a banking crisis, was actually “conservative,” and depended in no small part on rhetorical attacks on government spending that assuaged the concerns of bankers and other investors.
In making this case, Bittlingmayer and Hazlitt don’t much try to compare the nature of the 1933 banking crisis and today’s, and also don’t comment at all on how or why FDR departed from his wise conservative course in subsequent months and years. They do sneak into the argument the assumption that Obama’s (and, as anyone who reads polls can tell you, the public’s) concerns about the behavior of corporate executives seeking public subventions are disastrously undermining investor confidence:

Limiting corporate jets and CEO salaries may play well to the crowd. But every rational shareholder knows that jets make sense if (and only if) they help increase profits, and that arbitrary pay limits don’t protect company assets or owners. Instead, failed managers need to be replaced, at competitive wages, by superior ones. New shareholder protections that made that easier would attract bipartisan support and be cheered by investors.

I guess that these gents think investors are “going Galt” in their own small way out of disgust at public anger over their “rational” perks, and depressing the markets. By suggesting that current psychology, not past policies and events, are responsible for the current crisis, this is a clever means of shifting blame from Bush and the GOP to Obama and Democrats, which is an obvious objective in virtually all conservative agitprop these days.
But it’s interesting the extent to which the profs rely for their argument almost exclusively on the accounts of the 100 days by Raymond Moley, the brain-truster who left the Roosevelt administration midway through 1933, and then devoted much of the rest of his long career to New Deal-bashing, contemporary and revisionist. It’s a bit like citing Dick Morris as the definitive chronicler of the Clinton administration. Like Morris, Moley was indeed briefly a shaker and mover in a presidential administration. But like Morris, he chose to go into opposition, and his bitterly expressed interpretation of the deeds and thoughts of his one-time chief have to be taken with a shaker of salt.

The broadly exhibited public anger about the AIG bonus scandal, and equally broad if less intense hostility to federal “bailouts” of financial institutions, has spurred a lot of worthy ruminations about populism in its various manifestations. Most of them quote Bob Borosage (though without a link; I can’t seem to find the source online, either) as reminding us of this historical lesson:

If the Roosevelt era is any parallel, you’ll get both a left-wing populism and a right-wing populism. It was not just Huey Long, it was also Father Coughlin. There is an anger out there that is populist and will take right-wing and left-wing forms. And politicians on each end of the political parties–aided by populist rabble-rousers–will start to stoke this anger and move it.

Today at TNR Walter Shapiro talks at some length about the risk of a major populist backlash against Obama’s financial policies, and even suggests the White House fears such a backlash more than any conventional Republican opposition. But he goes on to note that there’s no obvious political vehicle for this backlash. To the extent that Republicans oppose corporate subsidies, it’s primarily from a laissez-faire point of view that’s not shared, and never really has been shared, by that much of the public. A party that excoriates bailouts while demanding lower corporate and upper-income taxes, and in some cases applauding deflation and unemployment as healthy, isn’t going to go much farther than a default-drive anti-incumbent electoral option, particularly since the GOP continues to hold generally unpopular positions and manias on cultural issues. And as Shapiro notes, for all the unhappiness evident in some precincts of the Left about the policies and backgrounds of administration officials like Geithner and Summers, there are no signs so far of a revolt against Obama:

[U]nlike Democratic predecessors like Lyndon Johnson or Jimmy Carter, Obama does not have to brood about a political threat from his left flank. Even Vermont’s independent socialist Senator Bernie Sanders offers praise for the new president: “I think, in general, Barack Obama is doing a very good job.” For Capitol Hill left-wingers like Sanders, the emphasis is less on pressuring Obama and more on shining a spotlight on Wall Street for its rule of ruin. “We need a real investigation–not a sham investigation–about how this crisis did occur and who were the people pushing subprime loans and who were the people who fought for deregulation,” Sanders says. “We need a real investigation and we need to hold people accountable.”

Still, Shapiro notes, the anger out there is real and palpable, and could produce “ideologically incoherent rage.” He specifically suggests that bipartisan coalitions in Congress could emerge to block future Obama measures that appear aimed at propping up financial or even industrial firms. That certainly makes sense, if you remember how hard it was to secure congressional approval of the very first bailout package last year, despite support from the president, congressional leaders of both parties, and the presidential candidates of both parties.
Tactical coalitions aside, though, the ideological and institutional barriers to some left-right populist convergenge that overturns not only the Obama administration but politics-as-we-know-it are formidable. It’s worth remembering that the terrifying alliance of Huey Long, Father Coughlin and Francis Townsend that Borosage alludes to, united in hostility to both the New Deal and Corporate America, ultimately produced little more than the anemic Union Party ticket of 1936, which registered less than 2% of the popular vote as FDR cruised to a crushing re-election victory.
Strange times produce strange politics, so Team Obama is wise to worry about the kind of rage spurred by the AIG mess. In the end, though, the administration’s ability to turn the economy around will determine whether populist outrage can be assuaged or even harnessed by Barack Obama, or instead becomes a phenomenon as “postpartisan” as anything he proposes.

Nate Silver has a fascinating post up today at 538.com, based on his gleanings from the news aggregator Memeorandum, analyzing the spread of the AIG bonus story.
It all started with a Washington Post article posted online last Saturday night, and, after a very brief lull, it steadily emerged as a mega-story:

On Sunday, the story gained significant steam throughout the liberal blogosphere. By 3 PM, according to Memeorandum, 20 independent (e.g. not related to a major media outlet) blogs had picked up some variant of the AIG story, of which 16 (by my count) have a definitive liberal orientation. There was then an additional round of attention later in the day, this time mostly coming from the mainstream media, after AIG’s counterparty list was released, and as the papers began to release content online from their Monday editions.
AIG-related affairs continued to dominate the discussion on Monday after Barack Obama said he wanted to block the bonuses and amidst speculation about the political fallout. Over the course of the day, the discussion tended to shift from liberal blogs to mainstream media channels.
Then yesterday (Tuesday), the story got bigger rather than smaller, becoming the subject of about twice as much discussion as it had been 24 hours earlier. Noteworthy about yesterday is that conservative blogs, which had been slow on the trigger initially, finally started to cover the story en masse, perhaps sensing the potential for embarrassment to the Administration.

This pattern isn’t that surprising when you think about it for a bit. The “liberal blogosphere” is divided between people who strongly oppose financial industry bailouts, and those who don’t, or who at least have some sympathy for the reasons for them. Both camps have every reason to get angry about the AIG bonuses, so both gave the story attention. MSM coverage followed news hooks (though by now, of course, it’s migrated on to coverage of the public reaction as a news item in itself). And while fairly big majorities of conservative bloggers claim to deplore financial industry bailouts, they don’t generally like to “demagogue” about high corporate pay (after all, it’s the low-income mortgage-holders who are really to blame, right?), so they ignored the story until it became about an apparent mistep by Obama and Geithner.
But what Nate’s talking about is significant: the stories that tend to build and build and become mega-stories feeding on themselves are those which attract heated commentary from different directions. When the story quickly morphs from one of corporate greed to one of “liberal” incompetence, it becomes a pinata that gets whacked hither and yon.
If you think of the AIG bonus story in terms of the amount of time that is necessary for a blogger to read and digest a news item, and then a news reporter to read a blog post, it actually developed pretty slowly. But from the perspective of a White House trying to deal with the substance of a very complex issue while monitoring and influencing the reaction, it must have seemed viral. And there’s only so much you can do via “damage control” once the story is whizzing around. It’s all the more reason to realize that careful strategic analysis of the negative news almost certain to emerge from a complex mess like the AIG meltdown and bailout is a very wise investment of time, if only to limit the number of people who leap on a breaking story from all sides of the political spectrum.