This item by TDS Co-Editor William Galston is cross-posted from The New Republic.
On Tuesday, Intel CEO Paul Otellini delivered a speech at Brookings on long-term economic competitiveness. While there were some points with which I disagreed—specifically, his critique of the stimulus plan and his advocacy of wide-ranging corporate tax cuts—I agreed with his core thesis: We’re not investing adequately or strategically in our nation’s future, and we’ll pay a huge price if we don’t change course.
To support his argument, Otellini cited some startling statistics: Although we rank sixth among the top 40 nation’s in innovation-driven competitiveness, we rank dead last—40th out of 40—in the effort we’ve made over the past decade to improve future competitiveness. That sounded too bad to be true, so I hunted down Otellini’s source, “The Atlantic Century,” a 2009 study conducted by the Information Technology and Innovation Foundation.
The ITIF constructs an index based on 16 indicators in six different categories—human capital, innovation capacity, entrepreneurship, information technology infrastructure, economic policy, and economic performance. A few examples will make the point. We rank fourth in science and technology researchers as a share of our workforce, but only 20th in our rate of change over the past decade; fifth in corporate R&D investment, but 17th in the rate of change; fourth in government R&D investment, but 15th in the rate of change; seventh in broadband, but 22nd in rate of change; first in GDP per working-age adult, but 16th in rate of change; and so on.
While statisticians can always quibble with the report’s selection of indicators and the methodology used to weigh and assess them, it’s harder to argue with its overall thrust. Because we’re under-investing in the areas that will determine our future dynamism and standard of living, we’ll continue to lose ground relative to our competitors and may eventually lose ground in absolute terms as well. (In seven of the 16 ITIF indicators, we’ve actually gone backwards since 1999.)
To be sure, 1999 represented a cyclical peak. Still, it’s hard not to conclude that the past ten years were a lost decade. We can’t afford to lose the next one. Our challenge now is to adopt policies that build a stronger future while reining in our unsustainable budget deficits and protecting working families from the harshest consequences of disruptive economic change.
The way forward is neither obvious nor easy. But one thing is clear: Our margin for error is a lot smaller than it was a generation ago. We can no longer afford to waste resources, public or private, on expenditures that do not create economic or social value. The federal budget and tax code are honeycombed with unproductive payoffs to special interests; it’s time to purge them. And the private economy has been dominated by a financial sector that’s more interested in transferring wealth (to itself) than in creating wealth through sensible investments. Perhaps the 2008-2009 financial crash will force bright young people to stop producing complex derivatives and start working on innovations that improve our lives.

I generally agree with J.P. Green’s take on today’s health care summit, but would add a couple of points in an effort to answer his question: will this help pass health care reform?
I doubt too many Americans watched the whole seven-hour show, and it’s unclear yet how it will be covered in the MSM (though I’m afraid the Obama-McCain exchange will soak up more attention that it really merited). But certainly the president and congressional Democrats did a good job of trying to explain the fundamentals of health care reform: why the system’s broken; why an individual mandate, subsidies, and regulation of benefit levels are necessary to fix it; and why Republican panaceas such as interstate insurance sales, association health plans, health savings accounts, and state high-risk pools, won’t help and will probably make things worse. Anyone who did watch big chunks of the summit probably understands by now that you can’t just do the easy, popular stuff like banning exclusions of people with pre-existing conditions and let it go with that. You’d guess that a poll of people watching would rate the Democratic approach to health care reform as far superior to that of Republicans, and perhaps that impression will spread or seep through the media coverage.
The harder question is how the summit affects public opinion on the very key question of what comes next. From the president on down, Democrats frequently said there were many areas of fundamental bipartisan agreement, and Republicans frequently said it’s time to start over and work on a bipartisan plan. You could listen to all that talk and conclude it’s time for a new round of negotiations based on “common ground.” If you listened more closely, you’d more likely conclude that Republicans object to the basic design of any plausible comprehensive health care reform initiative, and that “common ground” is confined to some broad goals that have never been in doubt, and to some details that could theoretically still be addressed, but that aren’t game-changers for anybody. Any time Republicans seemed to sound too agreeable or friendly towards the president, one of their leaders (most notably House Minority Leader John Boehner) would reset the mood with some hammer-headed comments on “government takeover of health care ” or “abortion subsidies,” as though to remind all attendees that this is essentially an exercise in political theater.
The President’s concluding comments indicated that he wanted to let the summitry marinate for a while, and see if some new progress could be made within four or six weeks. But at that point, he made clear, it would be time to act, which means the House passing the Senate bill and then the Senate and House enacting what would normally be a conference committee report via reconciliation (which, as Democrats kept explaining today, is hardly an unusual procedure for major legislation). If, as appears most likely, Republicans simply retreat to their “start over” demand, you can expect Obama to unilaterally endorse a few more of “their” ideas (perhaps a stronger interstate sales provision with stronger federal regulation, or something more tangible on medical malpractice reform than grants to states, or maybe one of Tom Coburn’s fraud prevention or chronic disease management concepts), and then let the public decide who’s been reasonable. Since it would have probably taken that long to work out differences among House and Senate Democrats anyway, nothing much will be lost by this kind of delay, and perhaps the summit will have somewhat disrupted the conservative demonization campaign over the entire legislation.
At the very least, opponents of health care reform can no longer credibly complain that they haven’t been given a fair hearing for their “ideas” and their point of view. And Democrats have been given, and have largely taken advantage of, a fresh opportunity to get back to the basic arguments for health care reform.

After watching a couple of hours of the health care reform summit today, I’d have to call it a big step towards enacting a credible bill. There were no major Democratic gaffes and the Republicans were unable to make a very persuasive case against the bill. Indeed, their incessant repetiton of the “my district hates this bill” put-down must have sounded a little scripted and unconvincing to viewers who were trying to make up their mind about the legislation, based on the best evidence presented by both parties.
President Obama looked large and in charge, calling everyone by their first names, while they all had to answer him as “Mr. President,” as he responded to most of the comments made by the Republicans and generally had the last word. This was a highly creative and effective use of the bully pulpit, which amplified the president’s image as a manager and a thoughtful leader who is sincerely trying to work some of the opposition’s ideas into the legislation. Again and again, he appealed to the Republicans to identify areas of agreement, which many Democrats noted, while few Republicans responded positively. President Obama’s performance will probably lend some cred to the public’s perception of the bill.
It was President Obama’s show. But other Dems acquitted themselves well enough. The Republicans did their best to appear as level-headed conservatives, not unduly influenced by tea party theatrics, and most pulled it off. Even the exchanges about resorting to budget reconciliation were impressively devoid of shrill demagoguery.
The civility of the exchanges is more a net plus for Dems because, as Chris Bowers notes in his OpenLeft post, “The largely positive impact of a boring health care summit,”

…makes charges of “communism” or “obstruction” seem a lot less credible. It looks like well informed people are discussing substantive legislation, rather than throwing bombs at each other…All in all, the summit is a huge net positive for the possibility of passing health reform this year. Democrats were losing the rhetorical battle on this bill, and a boring summit largely helps them.

A commenter called ‘workingclassdemocrat’ responds to Bowers, echoing,

I think summit deflated the fierceness of the GOP attacks. If nothing else, there haven’t been many “death panel” moments. That alone means the discussion is closer to reality. I think the time taken for this discussion and the buildup to it have allowed many on the left to reflect upon the benefit of choosing between this bill or nothing. Given the pressure of the media, the health industry, and the lack of pressure by the White House, something near to the Senate Bill is probably the reality.

The hysterical rhetoric about ‘socialism’ and Democratic reforms leading to economic disaster will probably sound a little less credible to open-minded voters, who the Republicans hope to win in November. No one can now say their views didn’t get a fair hearing, and the President addressed all of the critiques with calm, respectful authority. Hard to see any downside for the Dems.

To distract myself from the intense desire to scream while listening to Sen. John Kyl (R-AZ) speak at the health care summit, I read a fine post by Nate Silver that explodes the myth that incumbents who don’t hold a majority in early polls are already toasty if not toast. This myth is being used by Republicans to declare a lot of Democrats as walking dead long before campaigns actually develop. Turns out, though, the available evidence doesn’t support that proposition. Here’s Nate’s conclusion:

1) It is extremely common for an incumbent come back to win re-election while having less than 50 percent of the vote in early polls.
2) In comparison to early polls, there is no demonstrable tendency for challengers to pick up a larger share of the undecided vote than incumbents.
3) Incumbents almost always get a larger share of the actual vote than they do in early polls (as do challengers). They do not “get what they get in the tracking”; they almost always get more.
4) However, the incumbent’s vote share in early polls may in fact be a better predictor of the final margin in the race than the opponent’s vote share. That is, it may be proper to focus more on the incumbent’s number than the opponent’s when evaluating such a poll — even though it is extremely improper to assume that the incumbent will not pick up any additional percentage of the vote.

Nate goes on to say that a much narrower version of the “50% incumbent rule,” which focuses on polls taken late in an election cycle, has more merit, but isn’t really a “rule” either. On the other hand, incumbents who register at above 50% in early polls do typically win. This ought to be kept in mind by Republicans who are fantasizing about a late “wave” that will sweep popular Democratic incumbents (and there are some) out of office.

Like many of you, I’ve been watching the health care summit, and can’t decide just yet if it’s a spectacle of complex drama, or just one of the longest congressional hearings to be broadcast in a long time. For those unfamiliar with congressional events, the preliminary throat-clearing and personal preening must be excrutiating.
The Republican strategy for this event is pretty clear already: act like the administration is doing something really outrageous by using reconciliation to finalize the health care legislation already passed by both Houses. As I mentioned yesterday, this is factually ludicrous, but repeating talking points does sometimes work.
It’s pretty interesting that tea partiers are protesting the very existence of the event outside Blair House. Appointing themselves representatives of the people, and making unconditional demands on their behalf, has been a hallmark of their movement all along.

“Flip-flopping” on major issues can be hazardous to your political health. “Flip-flopping” when you’ve branded yourself as a brave principled “maverick” can be especially dangerous. And “flip-flopping” on grounds that you were confused about the issue in question is really, really bad, particularly when you are on the far side of 70.
That’s why John McCain may have ended his long political career the other day when he responded to attacks by primary challenger J.D. Hayworth on his support for TARP (popularly known from the beginning as the “Wall Street Bailout”) by claiming he was misled by the Fed Chairman and the Treasury Secretary into thinking the bill was about the housing industry, not Wall Street:

In response to criticism from opponents seeking to defeat him in the Aug. 24 Republican primary, the four-term senator says he was misled by then-Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke. McCain said the pair assured him that the $700 billion Troubled Asset Relief Program would focus on what was seen as the cause of the financial crisis, the housing meltdown.
“Obviously, that didn’t happen,” McCain said in a meeting Thursday with The Republic’s Editorial Board, recounting his decision-making during the critical initial days of the fiscal crisis. “They decided to stabilize the Wall Street institutions, bail out (insurance giant) AIG, bail out Chrysler, bail out General Motors. . . . What they figured was that if they stabilized Wall Street – I guess it was trickle-down economics – that therefore Main Street would be fine.”

What makes this claim especially astonishing is that McCain was rather famously focused on TARP at the time. He suspended his presidential campaign to come crashing back into Washington to attend final negotiations designed to get enough Republican support for TARP to get it passed. He was, by all accounts, a very passive participant in these talks, but it’s not as though he wasn’t there. And you’d think his memories of the event would be reasonably clear, since it probably sealed his electoral defeat.
It’s not obvious how McCain can walk this statement back. And in terms of the political damage he inflicted on himself, it’s hard to think of a suitable analogy without going all the way back to 1967, when Gov. George Romney (father of The Mittster) destroyed his front-running presidential campaign by claiming he had been “brainwashed” by military and diplomatic officials into erroneously supporting the Vietnam War. He never recovered from that one interview line. (Sen. Gene McCarthy, who did run for presidential in 1968, was asked about the Romney “brainwashing” by David Frost, and quipped: “I would have thought a light rinse would have been sufficient.”).
McCain has a more sizable bank of political capital than George Romney ever did, but in a primary contest where he was already in some trouble, the suggestion that he was brainwashed by a Republican administration into fundamentally misunderstanding the central national and global issue of the moment–not to mention the central current grievance of voters with Washington–could be fatal. It doesn’t help that it will vastly reinforce Hayworth’s not-so-subtle claims that McCain is a fine statesman whose time has come and gone, and is now losing it.

We’ve already heard repeatedly, and will hear incessantly during and after tomorrow’s health care summit, that use of the budget reconciliation process to enact changes to the Senate-passed bill represents an effort to “ram through” controversial legislation through some sort of obscure, draconian procedure. Conservatives have taken to calling it the “nuclear option” (appropriating a term that actually referred to the Republican threat in 2005 to outlaw all filibusters of judicial nominees).
Aside from the fact that the House and Senate have both duly enacted health reform legislation, and are utilizing reconciliation simply to make changes in the Senate bill that Sen. Scott Brown has promised to block, the idea that reconciliation is not a legitimate way to deal with health care issues is wrong from any historical point of view, particularly for Republicans who have resorted to it regularly.
Long-time health care journalist Julie Rovner has an important article up on the NPR site documenting the long history of reconciliation bills with major health care components. To hit a couple of highlights, SCHIP was created via a reconciliation bill (the 1997 Balanced Budget Act touted by Republicans at the time as an epochal achievement), and so, too, was the legislation allowing people to continue health insurance policies terminated by their employers (the term for this procedure, COBRA, refers to the Consolidated Omnibus Budget Reconciliation Act of 1986).
Sometimes Republicans claim that reconciliation is inappropriate for health care legislation because the procedure was designed for provisions strictly intended to reduce the federal budget deficit. According to CBO, of course, the House and Senate health care bills do in fact reduce budget deficits. Moreover, this particular Republican complaint rings rather hollow since GOPers used reconciliation to enact the mother of all budget busters, the Bush tax cuts of 2001.
The reality is that reconciliation, at least after its incredibly expansive use by the Reagan administration in 1981 to enact much of its agenda, has long been understood as the way Congress gets important business done on a broad array of issues that affect federal spending. Calling it the “nuclear option” or “draconian” doesn’t change that history, and progressives really need to push back on that distorted construction.

Need a good piece of evidence for the proposition that the latter-day Senate filibuster tactic is aimed at obstruction of action by the majority rather than opposition to questionable policies? Look at the final vote on the first “jobs bill” (a relatively small package of payroll tax credits for companies hiring new employees, and money for transportation construction). Six GOP senators who voted against cloture on the bill, and two others who were absent on the cloture vote (the functional equivalent of a “no” vote) flipped and voted for final passage.
As Josh Marshall points out:

It shows you a lot of the cowardice, buck-passing and general nonsense behind the current use of the filibuster. By any logic, the numbers should go the other way: the number of people who are willing to allow a vote should if anything be greater than the number who are willing to vote for the legislation on its merits.

You’d think so, but “logic” isn’t the ruling principle in the Senate right now.

Democrats who are anxious about the white house summit on health care tomorrow should find comfort and encouragement in Michael Gerson’s WaPo op-ed. “Obama’s Health Reform Gamble Raises Questions of Judgment.” Gerson, who served as President Bush’s chief speechwriter and a senior GOP policy advisor, provides perhaps the best bellwether in newspaper journalism for Democratic policy-making, in that, whatever he advocates is designed to support Republican political interests, and therefore will likely screw everyone but the rich. Here’s Gerson’s critique of the budget reconciliation process:

…Enacting health reform through the quick, dirty shove of the reconciliation process — would add coercion to arrogance…the imposition of a House-Senate health-reform hybrid would confirm the worst modern image of the Democratic Party, that of intellectual arrogance. Parties hurt themselves most when they confirm a destructive public judgment. In this case, Americans would see Democrats pushing a high-handed statism…Obama’s decision on the use of reconciliation will define his presidency. If he trusts in his charmed political fortunes and lets the dice fly, it will raise the deepest questions about his judgment.

In Gerson-think a simple majority is tantamount to a “dirty shove,” “coercion,” “arrogance,” and “high-handed statism.” He suggests it’s “intellectual arrogance” to believe that a true majority requires less than 60 percent. His readers are supposed to buy the argument that passing legislation with anything less than 60 Senate votes is outrageous.
Gerson warns that budget reconciliation “would almost certainly maintain conservative and Republican intensity through the November elections” — as if there was any chance of that not happening. He says budget reconciliation “would both insult House and Senate Republicans and motivate them for future fights.” What, not like now? We certainly don’t want to hurt their tender feelings, since they have been so kind when they were in majority.
Gerson’s readers are supposed to believe that, if only the selfish Democrats would cave on the principles that elected them, Republicans would become more cooperative. He warns, “The minority would not only be defeated on health reform but its rights would be permanently diminished — a development that would certainly be turned against Democrats when they lose their majority” — which sounds an awful lot like majority rule.
Few Dems will be hustled by Gerson’s polemic. No one believes the Republicans would not use budget reconciliation to enact any part of their agenda, as they did to ram through Bush’s deficit-expanding tax cuts and in their failed attempt to open the Arctic National Wildlife refuge to oil drilling.
More importantly, majority rule — 50 percent plus one — is more than defensible. It’s a fundamental principle of great democracies. Arguing otherwise, that the party in minority should have a permanent stranglehold on the fate of all reform legislation– is the real elitist arrogance.

Looking forward to tomorrow’s health care “summit,” Ben Smith of Politico has a pretty good summary of the five distinct audiences the President must think about in handling this event: House Democrats, Senate Democrats, the Public, the Fans of Bipartisanship, and Republicans. But there are obviously priorities in his messaging:

He’ll be making the sale, for the umpteenth time, to an American public that supports aspects of health care legislation but opposes the bill. He’ll be pitching Beltway graybeards obsessed, as always, with bipartisanship. He’ll be appealing to moderate Senate Democrats to back reconciliation.
But most important will be his pitch to a handful of conservative Democrats in the House who will have to switch their votes and vote for the Senate health care bill for it to pass into law.

Smith’s right that the most important immediate audience is House Democrats. In the longer run, however, this summit is a very important landmark in his overall positioning of himself and his party for the midterm elections in November. The reality in Washington is that a Republican Party that is becoming more ideologically extreme each day is using every procedural tool and political trick you can imagine to avoid any real action on any significant issue. If that reality becomes more generally known because of the summit, then it will be a success for Obama and Democrats, regardless of how it plays with the Republicans, the pundit class, or Democrats who are wavering on health reform.