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

Sheryl Jean of the Dallas-Morning News ‘Economy Watch Blog’ reports that the National Small Business Association has launched a new website, “Health Reform Today.”
In his Alternet article, “Health Care Reform in Critical Condition,” Roy Ulrich discusses whether it is still true, as former HEW Secretary Joseph Califano said that “real health care reform in this country could not become a reality until we accomplished the goal of enacting campaign finance reform at the national level.”
Former Senator Tom Daschle has a WaPo op-ed urging Americans not to get distracted by conservative fear-mongering about the ‘who’ of health care reform, and instead keep focused on the ‘what’ and the imperative of making reform a reality.
Also at WaPo, Karen Pallarito takes a look at the Obama Administration evolving health care reform proposals in light of a recent national opinion survey by Kaiser Family Foundation and the Harvard School of Public Health (toplines here).
Salon.com columnist Joe Conason’s “The questions our health care debate ignores” puts America’s health care system in global perspective in terms of universal coverage and cost.
Roger Hickey, co-director of the Campaign for America’s Future, takes an interesting look at current reform options facing Obama and the Democrats in “An Election, a Budget, and Two Summits = A Bold Obama Strategy for Health Care Change.”
On March 3rd, I suggested that the failures of health care system are as much if not more of a real threat to national security in terms of protecting the lives of Americans than terrorism. Imagine, for example, the outrage if the death toll for our troops was 60 per day in Iraq or Afghanistan, because 60 per day or about 22 thousand Americans per year die from “the lack of health insurance,” according to the Institute of Medicine.
The Atlantic‘s Marc Armbinder reports that The Obama Administration will pursue health care reform through the 2010 budget resolutions, if they can’t forge a bipartisan consensus. Nate Silver of fivethirtyeight.com riffs on Armbinder’s article, noting the additional leverage Dems get in the struggle for health care reform as recession deepens and arguing that “it’s a fight where the White House ought to be favored.” Ezra Klein also has a post up today at The American Prospect on the legislative strategy of health reform via the budget process.
Ezra Klein also has an In These Times interview of Steffie Woolhandler, co-director of Physicians for a National Health Program, and Richard Kirsch, the national campaign manager for Health Care for America Now (HCAN) on the topic, “Which Way to Universal Healthcare?.”
A CNN/Opinion Research Corporation poll conducted 3/12-15 found that nearly three out of four adults are “happy with their overall health care coverage,”but more than three out of four respondents are “dissatisfied with the total cost of health care in this country” and only 29 percent say they are “very confident” they could pay their bills in the event of a major medical emergency.
Single-payer advocates will find americanheathcarerreform.org a bountiful source of links to insightful articles on the topic.

This week, the Seattle Post-Intelligencer printed its last issue. Last month, the Rocky Mountain News ceased to exist. Across the country, newspapers and magazines are cutting staff, reducing coverage, and scaling back.
Journalists feel like they’re living in a crisis, and rightly so. A respected profession that has been supported by a stable, profitable business model for more than a hundred years is about to be upended.
But it’s the business model which has been given the death sentence — not the profession. The end of print is not the end of journalism.
In a brilliant essay published online this week, Clay Shirky writes:

Society doesn’t need newspapers. What we need is journalism. For a century, the imperatives to strengthen journalism and to strengthen newspapers have been so tightly wound as to be indistinguishable. That’s been a fine accident to have, but when that accident stops, as it is stopping before our eyes, we’re going to need lots of other ways to strengthen journalism instead.

The future offers plenty of alternatives — we just don’t know what they are yet.
The newspaper business is dominated by the fact that owning and operating a printing press is an enormously expensive endeavor. Those production costs are so high that newspapers rely on a combination of advertising and paid subscription to turn a profit.
The Internet poses an incredible threat to print journalism because it reduces production costs to nothing. That in turn provides competition for both advertiser dollars and story coverage.
Classified advertising — which used to be the lifeblood of newspapers all over the country — has been replaced by Craigslist. Print journalists are so frequently scooped by online competitors that many newsrooms have shifted their production schedules to meet the demands of the Internet (which means publishing stories online immediately), and it seems like every beat writer in America has her own blog and Twitter feed.
Perhaps no fact better demonstrates the absurdity of print production than this: The New York Times could buy each of its subscribers a new Amazon Kindle — the popular e-book reader which offers Times content — for half the amount of money that it costs to print and deliver its newspaper each year.

Read more…

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.

President Obama’s quick apology for his gaffe likening his bowling skills to the “Special Olympics or something” on Jay Leno’s Tonight Show was well-timed and well-directed. Shortly after his appearance on the program, the President called Special Olympics Chairman Timothy Shriver, who described the President’s apology as “sincere and heartfelt.”
In his response, Shriver offered a challenge:

This is a teachable moment for our country. We are asking young people, parents and leaders from all walks of life to engage in conversation and help dispel negative caricatures about people with intellectual disabilities. We believe that it’s only through open conversation and dialogue about how stereotypes can cause pain that we can begin to work together to create communities of acceptance and inclusion for all

Shriver also urged the white house to hire a Special Olympics athlete and he called on “policy leaders at all levels to commit to improving the support and resources for people with intellectual disabilities in areas such as healthcare, education, housing and recreation.” This may be why Republican leaders have thus far not made too much of the President’s remark, since they have rarely supported adequate funding to help people with intellectual and physical disabilities. President Obama, on the other hand, has a robust agenda to expand assistance to people with disabilities.
People with disabilities, together with their families, are one of the largest constituencies in the electorate. It is estimated that approximately 20 million Americans with disabilities voted in the November election. Factoring in their families, a rough guestimate of 50 million voters significantly affected by disability policies would not be far out of line.
The ‘teachable moment’ for Obama offers a good lesson — the need for heightened sensitivity to the struggles of people with disabilities and their families. Also, be careful on the late night talk shows, where the format encourages loose jabber, as well as an opportunity to humanize or ‘warm up’ political leaders.

Over at RealClearPolitics, you can find a valuable exchange between RCP’s Jay Cost and TDS Co-Editor Ruy Teixeira over the latter’s “New Progressive Majority” study published recently by the Center for American Progress.
A few days ago, Cost questioned Texeira’s confidence that the demographic trends he documented in the study represented a reliable indicator of future presidential election cycles, suggesting that short-term factors including campaign dynamics are often crucial variables. Texeira’s response notes that he’s dealing in trends and probabilities, not predictions or certainties, and makes this point about perennial “short-term factors” dismissals of electoral results:

Of course, there are some–Cost appears to be one–who argue that all elections are not much more than short-term forces and that’s all you need to look at. By that logic, the election of Ronald Reagan in 1980 was all about short-term discontent with Carter and the economy and the shifting patterns of support compared to twenty years previously were not of much significance. But that wasn’t true then and I suspect the argument that Obama’s victory was all short-term forces will also turn out to be incorrect.

In a wrap-up post, Cost partially concedes some of Teixeira’s arguments, but notes the strong belief of Republicans as recently as four years ago that trends were moving permanently in their direction.
The whole exchange is worth reading. But while Jay Cost raised some good questions about the implications that some Democrats might draw from Teixeira’s study, he didn’t lay a glove on Ruy when it came to the data.

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.

The most amusing story out there today is provided by Politico‘s Manu Raju, who’s been trying to push Republican Member of Congress to take a position on a proposed surtax for those receiving bonuses from AIG. Here’s the money quote:

They wouldn’t mind letting the bonus issue linger for a while, and they’re wary of either signing on to the plan — and with it, a tax increase — or resisting it, and thereby risking being seen as insufficiently tough on AIG and its employees

Could be that GOP Congressmen are waiting for Grover Norquist to make up his mind how he feels about an AIG bonus tax:

Thirty-four senators and 172 House members signed a pledge with the Americans for Tax Reform saying they would not vote to raise taxes. The group is still evaluating the legislation and has not determined yet whether a vote for the plan would violate the pledge.

Republicans hope Grover’s staff gets a move on. The House is likely to vote on an AIG bonus surtax this very day, and while GOPers would prefer to be watching NCAA tournament basketball, they’re going to have to go on the record as to whether their fear of voter wrath or their hatred of government is greater.

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.

One of the most consistently advanced arguments in the conservative effort to oppose the Obama administration’s policy agenda is that it is exhibiting “arrogance” or “hubris,” and is also making a mockery of all of the president’s previous rhetoric about reaching across the partisan aisle and respecting other points of view. Almost invariably, the stimulus legislation, and the administration’s health care and climate change proposals, are cited as exhibits A, B and C. There’s a classic version of this argument being offered in the current issue of National Review by Ramesh Ponnuru, one of the smartest and least hackish of contemporary conservative political writers. And the same argument has been offered by self-styled “centrists” like David Brooks, and even to some extent by those “centrist” Democrats who want to take legislative vehicles for majority rule like budget reconciliation procedures off the table.
This whole approach, of course, is intimately connected with the conservative claim that Obama is, as they of course warned during the presidential campaign, a “radical” who is turning a 7 percentage point popular vote magin on November 4 into an illegitimate mandate for all sorts of crazy socialist intentions that he craftily hid from public view on the campaign trail.
At the risk of redundancy (not that this seems to be a concern of Obama critics), it’s helpful once again to examine this argument and expose its very shaky underpinnings.
Of course Obama didn’t outline the stimulus legislation in detail on the campaign trail, because the financial and economic meltdown largely occurred at the very tail end of the contest, and worsened significantly later on.
The size and structure of the stimulus legislation reflected decades of progressive, “centrist,” and even some conservative opinion on what government should do in the case of a collapse in demand and credit. And in the intra-progressive debate about exactly what Obama should propose, he hardly sided with “radicals,” or even old-fashioned liberals, who typically feared the stimulus package was too small to work and too open to “centrist” or conservative influence.
On health care reform and climate change, Obama is proposing relatively modest versions of what Democrats have largely agreed on in these areas for quite some time, and of what he specifically and consistently pledged to do throughout his presidential campaign. He has also specifically and consistently argued that dealing with these two topics would be expensive in the short run but extraordinarily cost-effective in the long run–an approach that also happens to nicely coincide with a fiscal strategy of short-term stimulus and long-term fiscal sanity.
As for “bipartisanship,” Obama has specifically and consistently offered Republicans a seat at the table if they were willing to agree with him on major policy goals and key principles–the “what” rather than the “how.” Since most Republicans have loudly and fundamentally disagreed with his major policy goals and key principles in terms of the stimulus package (they either want to do nothing or rely strictly on tax cuts), health care reform (they continue to pursue such truly radical ideas as forcing all Americans into individually purchased health insurance or paying for health care with cash via tax-preferred savings), and climate change (they either deny the problem, want to use all carrots and no sticks to bribe companies into alternative energy usages, or simply say the problem’s too expensive to address), Obama’s moved on without them.
A lot of the conservatives (though not Brooks or Ponnuru) who are attacking Obama for abandoning bipartisanship violently deplore the very idea themselves, so it’s not an objection to be taken very seriously in any event.
The one area where Obama critics have some sort of case for pig-in-a-poke charges is on the subject of financial industry “bailout” or “repair” or “damage mitigation” policies (there’s no real term for this policy area that’s not loaded, unfortunately). Whatever else they represented, the last two national elections that produced Democratic control of Congress and the White House weren’t referenda on what to do if a housing market collapse produced a financial system collapse that produced a credit collapse and then a consumer demand collapse. To the extent that the last few weeks of the 2008 presidential campaign revolved around this scenario, there certainly wasn’t any clear-cut D versus R split of opinion on what to do immediately, and Obama had zero input into the Bush administration’s structuring of the first big round of bailouts. If anyone in politics “flip-flopped,” it was the large segment of the GOP, including its presidential candidate, who conspicuously backed the Bush bail-out but now talks as if anything vaguely similar as pursued by Obama is insane.
An even more mendacious aspect of the criticism of Obama’s financial industry policies from the Right is the ventilating about “corporate welfare.” If Obama abandoned the current approach in favor of a temporary government takeover of imploded financial institutions–the most visible option other than doing nothing–they’d be the first to scream that he had succumbed to Red Russian Socialism.
The main point is that Obama’s done pretty much what he promised to do, and has departed from his campaign pledges mainly in areas outside the orbit of campaign discussion, and mainly in the direction of accomodation of “centrist” views. It’s entirely legitimate for conservatives or anyone else to argue that his policies are wrong or won’t work, but the idea that ideological rigidity or “arrogance” characterizes his young presidency is tiresomely threadbare. And by and large, the notion that fidelity to ideology represents “hubris” sounds more than a bit strange from conservatives who are competing with each other to see who can most loudly denounce George W. Bush and latter-day GOP “reformers” for failing to hew to the True Faith.