The President Holds an Open Discussion Across the Aisle in Baltimore after the State of the Union

Obama mentions tort reform at the House GOP Event in Baltimore

President Obama: 'It's not enough if you say, for example, that we've offered a health-care plan.... But specifically, it's got to work. You know, if I'm told...that the solution to dealing with health-care cost is tort-reform--something that I've said I am willing to work with you on--but the CBO or other experts say to me, "You know, at best, this could reduce healt-care costs...by a couple of percentage points, or save $5 billion a year...and it will not bend the cost curve long-term or reduce premiums significantly," then you can't make the claim that that's the only thing that we have to do.'

(Taken from The Wall Street Journal.)

Site for Terror Trial Isn’t Its Only Obstacle

From The New York Times:

For much of President Obama’s first year in office, his national security team worked to devise a secure plan to send dozens of Yemeni detainees held at Guantánamo Bay, Cuba — the largest single group at the prison camp — home to Yemen, perhaps to a rehabilitation program.

Then came the Christmas Day airliner bombing attempt, which was planned in Yemen, and the president put all transfers there on hold.

Since November, the administration had been preparing to move the highest-profile Guantánamo prisoners — Khalid Shaikh Mohammed and four accomplices accused of plotting the Sept. 11, 2001, attacks — to Manhattan for a federal criminal trial.

[The administration may have] to revive the very option that the president and Attorney General Eric H. Holder Jr. had rejected: military commissions at Guantánamo for the 9/11 plotters.

For a president who campaigned on a promise to close Guantánamo, and who just missed a self-imposed one-year deadline to get the job done, the meltdown of a potential Manhattan 9/11 trial is the latest measure of the stubborn complexity of his national security inheritance.

For some who have always advocated military commissions for the 9/11 plotters, the demise of the Manhattan plan simply proved their point. “It just shows what a dumb idea it was in the first place,” said Senator Lindsey Graham, Republican of South Carolina, in an interview Thursday.

Mr. Graham plans to reintroduce legislation in a few days to block criminal trials for the 9/11 suspects altogether. A similar bill is already pending in the House. Two Democratic senators, Blanche Lincoln of Arkansas and Jim Webb of Virginia, joined several Republican colleagues last week in coming out against criminal trials for the Qaeda plotters, raising opponents’ hopes that Congress could make the hunt for a new 9/11 courthouse moot.

“The attacks of 9/11 were acts of war, and those who planned and carried out those attacks are war criminals,” the group of six senators wrote in a letter to the attorney general. They said that any American venue for a trial would become a terrorist target, and that military commissions were the proper way to bring terrorists to justice.

(1) Roubini Calls U.S. Growth ‘Dismal and Poor,’ Predicts Slowing. (2) Larry Summers on state of economy: 'Statistical recovery & a human recession.'

From Blooomberg.com:

New York University Professor Nouriel Roubini, who anticipated the financial crisis, called the fourth quarter surge in U.S. economic growth “very dismal and poor” because it relied on temporary factors.

Roubini said more than half of the 5.7 percent expansion reported yesterday by the government was related to a replenishing of inventories and that consumption depended on monetary and fiscal stimulus. As these forces ebb, growth will slow to just 1.5 percent in the second half of 2010, he said.

“The headline number will look large and big, but actually when you dissect it, it’s very dismal and poor,” Roubini told Bloomberg Television in an interview at the World Economic Forum’s annual meeting in Davos, Switzerland. “I think we are in trouble.”

Roubini said while the world’s largest economy won’t relapse into recession, unemployment will rise from the current 10 percent, posing social and political challenges.

“It’s going to feel like a recession even if technically we’re not going to be in a recession,” he said.

And from The Wall Street Journal:

Key Obama economic adviser Larry Summers coined a telling way to look at the current American economic state of play. He said the U.S. is experiencing a “statistical recovery and a human recession.”

It is a phrase that should resonate through much of the industrial world, where high and long-standing unemployment is increasingly becoming a huge domestic political issue.

Speaking on a panel at the annual meeting of the World Economic Forum in Davos, Summers said one in five American men aged 25 to 54 are unemployed. He said given a “reasonable recovery,” that rate could improve to one in seven or one in eight. That still contrasts with a 95% employment rate for that group in the mid-1960s.

He said the U.S. can gain from increased global integration, but if it is to be politically sustainable it “has to work for people.” That means job creation in the U.S. is a crucial issue.

To replace an aging fleet of warplanes, the Pentagon plans to buy 2,400 F-35s, known as the Joint Strike Fighters, for the Air Force, Navy & Marines.

The F-35 is designed to take off from short runways and land vertically.

From The Wall Street Journal:

To replace an aging fleet of warplanes, the Pentagon plans to buy more than 2,400 F-35s, known as the Joint Strike Fighters. The F-35 will be used by the Air Force, Navy and Marine Corps, as well as U.S. allies such as the U.K.

Last year, Mr. Gates shook up the Pentagon's weapons priorities, canceling or curtailing programs that weren't relevant or were too expensive. [B]ut funding for the F-35 program actually increased.
_______________

See update in this 2-1-10 article in The New York Times.

Peggy Noonan on the State of the Union address

Part of what Peggy Noonan had to say on the State of the Union address (from The Wall Street Journal):

President Obama's speech was not a pivot, a lunge or a plunge. It was a little of this and a little of that, a groping toward a place where the president might successfully stand. It was well written and performed with élan. The president will get some bounce from it, and the bounce will go away. Speeches are not magic, and this one did not rescue him from his political predicament, but it did allow him to live to fight another day. In that narrow way it was a success. But divisions may already have hardened. In our current media and political environment, it is a terrible thing to make a bad impression in your first year.

There were strong moments. Of what he frankly called the "bank bailout," he observed: "I hated it. You hated it." His unfancy language was always the most interesting: "We don't quit. I don't quit." The president conceded, with striking brevity, having made mistakes, but defensively misstated the criticism that had been leveled his way. He said he was accused of being "too ambitious." In fact he'd been accused of being off point, unresponsive and ideological.

The president did not speak of health care until a half hour in. "As temperatures cool, I want everyone to take another look at the plan we've proposed." Then, "If anyone has a better idea, let me know." Those bland little sentences hidden in plain sight heralded an epic fact: The battle over the president's health-care plan is over, and the plan will not be imposed on the country. Waxing boring on the virtues of the bill was a rhetorical way to obscure the fact that it is dead. To say, "I'm licked and it's done" would have been damagingly memorable. Instead he blithely vowed to move forward, and moved on. The bill will now get lost in the mists and disappear. It is a collapsed soufflé in an unused kitchen in the back of an empty house. Now and then the president will speak of it to rouse his base and remind them of his efforts.

As the TV cameras panned the chamber, I saw a friendly acquaintance of the president, a Republican who bears him no animus. Why, I asked him later, did the president not move decisively to the political center?

Because he is more "intellectually honest" than that, he said. "I don't think he can do a Bill Clinton pivot, because he's not a pragmatist, he's an ideologue. He's a community organizer. He mixes the discrimination he felt as a young man with the hardship so many feel in this country, and he wants to change it and the way to change that is government programs and not opportunity."

The great issue, this friendly critic added, is debt. The public knows this; Congress and the White House do not. "To me the Republicans are as rotten as the Democrats" in terms of spending. "Almost."

"I hope we have big changes in 2010," the friend said. Only significant loss will force the president to focus on spending. "To heal our country we need to get the arrogance out of the White House and the elitists out of the Congress. We need tough love. We need a real adult in the White House because we don't have adults in the Congress."

Connecting the dots on two posts from yesterday about the Obama administration beginning to fix the disconnect and listen to America.

Khalid Sheik Mohammed, the self-proclaimed mastermind of the Sept. 11 attacks, shortly after his 2003 arrest and in a recent photo.

This is a follow-up on two posts from 1-29-10 entitled "Obama begins to fix the disconnect & listen to America: Administration Considers Moving Site of 9/11 Trial" and "Yes; fixing the disconnect & listening to America continues: Obama faces dwindling options in his effort to close Guantanamo Bay."

From The Washington Post:

The Obama administration has all but abandoned its plan to put Khalid Sheik Mohammed, the self-proclaimed mastermind of the Sept. 11, 2001, attacks, on trial in Lower Manhattan, according to administration officials.

The reversal would mark the latest setback for an administration that has been buffeted at every turn as it seeks to close the military detention center at Guantanamo Bay, Cuba. Its options for closing the prison had already been dwindling, and without the backdrop of Ground Zero for a trial, the administration would lose some of the rich symbolism associated with its attempt to forge a new approach to handling high-profile al-Qaeda detainees.

The decision to reconsider the plan for Mohammed's trial comes after a surge of political opposition to holding it in Manhattan, a venue that Attorney General Eric H. Holder Jr. described in November as the "right place."

Moving the trial in the wake of political objections would not augur well for the administration's plans to bring other leading Guantanamo Bay detainees to other federal jurisdictions. Administration officials have said they plan to put about 35 Guantanamo detainees on trial, either in federal court or in military commissions.

Republicans and a number of Democrats in Congress have demanded that the detainees be tried in a military commission at Guantanamo Bay, arguing that they are enemy combatants in a war with al-Qaeda and the Taliban, not criminals deserving of the protections of civilian court.

But the decision to bring Mohammed and his cohorts onto U.S. soil for a civilian trial is a linchpin of Holder's tenure, and an administration official said the Justice Department would not back down on the central principle of trying the men in federal court and inside the United States.

But the administration would appear to have few good alternative locations.

The administration also hopes to acquire a state prison in Thomson, Ill., both to hold military commissions and to house detainees who are deemed too dangerous to release but unprosecutable. Conceivably, the Thomson facility, which would be guarded by the military, could also house a federal courthouse and a federal prison wing for detainees such as Mohammed.

Officials said they have not decided where to turn, and the administration still needs funding from Congress to acquire the prison in Illinois. One official said several domestic locations are under review.

Others, including relatives of the victims of the Sept. 11 attacks, said the administration should reconsider its decision to close Guantanamo Bay.

"I applaud the president for recognizing that a better decision needs to be made," said Hamilton Peterson of Bethesda, who lost his father and stepmother on United Flight 93, which went down in Shanksville, Pa. "But it seems insane to those of use who have visited the pristine $40 million courthouse in Cuba that he would not use it. I would hope he would also revisit the issue of military tribunals."

During his first State of the Union speech President Obama gives due credit to the Bush administration for the source of many of the country's woes.

From Political Junkie by Ken Rudin:

At the beginning of the last decade, America had a budget surplus of over $200 billion. By the time I took office, we had a one year deficit of over $1 trillion and projected deficits of $8 trillion over the next decade. Most of this was the result of not paying for two wars, two tax cuts, and an expensive prescription drug program. On top of that, the effects of the recession put a $3 trillion hole in our budget. That was before I walked in the door.

Good show by the Empire State of the South with its huge transportation issues: North Carolina invests, wins rail money; Georgia doesn't.

From the AJC:

North Carolina has spent more than $300 million since 1992 to bolster its passenger rail service. On Thursday, it saw a return on that investment: a $545 million slice of President Barack Obama's $8 billion high-speed rail stimulus.

Florida got an even bigger piece of that pie -- $1.25 billion. The Sunshine State may have helped its case by boosting funding for mass transit after U.S. Transportation Secretary Ray LaHood warned that it needed to get its act together to compete for high-speed rail funds.

Georgia got a similar warning but didn't jump to action. It got a $750,000 sliver.

So soon Florida will start work on a high-speed line from Orlando to Tampa, and North Carolina will get busy upgrading track from Charlotte toward Washington, D.C. Meanwhile, while they're building, Georgia will be studying. The $750,000 will be divided on projects examining the feasibility of three proposed lines: one from Atlanta to Birmingham, another from Atlanta to Chicago, and the third from Macon to Jacksonville.

Atlanta business leaders, warily eyeing the rise of Charlotte and other Southern cities, have dreaded this moment for years.

"It matters very much," said Renay Blumenthal, senior vice president at the Metro Atlanta Chamber, which has advocated for high-speed rail planning for more than a decade. "We have long feared," she said, "that there was going to be a high-speed rail from Washington, D.C., down the southeastern corridor, and we did not want to see that train stop in Charlotte. If it didn’t come down to Atlanta, think about the economic advantage that corridor gives to Charlotte."

Charlotte's line goes through Richmond to Washington. Lines on maps show it also would have come down to Atlanta if it were funded.

One lobbyist said Thursday's announcement hearkened to critical decisions that Atlanta and Birmingham, similar cities decades ago, made on transportation. “I’m afraid this is like Birmingham deciding not to expand its airport back in the 1950s,” giving Atlanta the opportunity to become a different class of city, said Matt Hicks, associate legislative director at the Association County Commissioners of Georgia.

Georgia did apply for a major grant from the $8 billion, asking for $472 million to build a complete, passenger-ready line between Atlanta and Macon. One problem: Georgia already has $80 million in federal earmarks for that rail corridor, which it has not spent.

Yes; fixing the disconnect & listening to America continues: Obama faces dwindling options in his effort to close Guantanamo Bay

From The Washington Post:

The closure of the military detention center at Guantanamo Bay, Cuba, is beginning to look like a protracted and uncertain project for the Obama administration as political, legal and security concerns limit the president's options.

David Brooks writes: Obama made a good start in the State of the Union address.

David Brooks writes in The New York Times:

If I were one of those fellows advising Barack Obama, I would tell him that . . . you need to distance yourself from the status quo. You need to detach from the Old Bull committee chairmen you foolishly affixed yourself to in your first year. You need to detach from all those deals with pharmaceutical lobbyists and earmark champions. You need to detach yourself from Washington’s ping-pong match of ideological overreach — as each party interprets victory as a mandate to grab everything.

You made a good start in the State of the Union address, I would tell him. In that speech, you began to reclaim the mantle of the permanent outsider.

First, you distanced yourself from the Democratic orthodoxy. You embraced some traditional Democratic policies, but also an eclectic grab bag of other policies that play well with independents: a spending freeze that excluded defense, nuclear power, offshore drilling, the elimination of a capital gains tax on small business, a fiscal commission, free trade deals and earmark reform.

Second, you distanced yourself from the old debates. You sidestepped the whole big-government-versus-small-government question. Instead of doing the liberal-people-versus-the-powerful shtick, you emphasized targeted tax cuts, deficit reduction and community bank subsidies.

Third, you distanced yourself from Washington morality. At times the speech was like a vice principal’s lecture to an unruly middle school classroom. You scolded Democrats and Republicans about excessive partisanship, pettiness and insider-dealing. You cast yourself as the sole coolheaded man in Gomorrah.

In short, you made it clear that you will not be going down with the Congressional Titanic. You took a few steps toward recapturing your image as the last thoughtful reformer. Now you have to embrace that role with a vengeance.

There aren’t going to be any big new policy initiatives this year anyway. You might as well cross the country on a Perot-like tour of consciousness-raising, complete with charts and everything.

The deficits are the issue around which everything else revolves. The mounting deficits both symbolize Washington’s institutional dysfunction and genuinely threaten the nation.

You want to cross the country screaming the facts. As you do, states like California and Illinois will be undergoing fiscal implosions to illustrate your ongoing point. You want to use the fiscal crisis as a wedge to change the way the whole system operates.

If you get a deficit-reduction deal, you break through the polarized rigidities that encrust everything else. You wipe clean the special-interest barnacles that encrust the tax code. You force the country to think in 30-year increments and deliver a blow to the tyranny of the news cycle. You force the country to accept common sacrifice. This is the issue that unlocks everything else. So will you establish your credibility and offer to raise taxes on the lower 98 percent? Yes, you can!

If the setbacks of the last year haven’t radicalized you about the sickness of our current political system, Mr. President, I don’t know what will. Are you really content to spend the year lobbying for tiny tax credits for ineffective training programs?

Obama begins to fix the disconnect & listen to America: Administration Considers Moving Site of 9/11 Trial

From The New York Times:

Facing mounting pressure from New York politicians concerned about costs and security, the Obama administration on Thursday began considering moving the trial of the chief organizer of the Sept. 11 terrorist attacks out of Manhattan, administration officials said.

A decision to move the Sept. 11 trial from Manhattan would be a retreat by the administration from its calculated choice in November to bring the defendants to a courthouse just blocks from where the World Trade Center stood.

Mr. Obama restated his support for a civilian trial, which supporters say would have more legitimacy than a military tribunal.

Say what? (1) Tonight Obama to accept responsibility, but not blame, for missteps, & will not agree that there is a disconnect. (2) Veep: All's fine.

From The New York Times:

Are the missteps at the White House rooted in message or substance?

When Mr. Obama presents his first State of the Union address on Wednesday evening, aides said he would accept responsibility, though not necessarily blame, for failing to deliver swiftly on some of the changes he promised a year ago. But he will not, aides said, accede to criticism that his priorities are out of step with the nation’s.

Still undecided, advisers said, was how much of the address would be devoted to health care as the prospects of finding a lifeline for the legislation seemed to be diminishing.

Vice President Joseph R. Biden Jr., in a speech on Tuesday to top party contributors in Washington, dismissed the political worrying among Democrats.

My man N.H. Sen. Judd Greg (who is in his last term unfortunately): "Congress is more concerned with the next election than the next generation."

From The New York Times:

Advocates of more aggressive steps to address the national debt failed Tuesday in their effort to create a bipartisan commission to press for tax increases and spending cuts, but President Obama now plans to establish a similar panel by executive order in his State of the Union address on Wednesday.

The proposal for a commission died when its supporters could not muster enough votes in the Senate to push it ahead, reflecting unwillingness among many Republicans to back any move toward tax increases and objections among Democrats to the prospect of deep spending cuts in Medicare and Medicaid. While 53 senators voted for the plan and 46 against, it needed 60 votes to be approved under Senate rules.

The alternative panel to be established by Mr. Obama will also come up with recommendations by December to reduce annual budget deficits and slow or reverse the growth of the national debt. But unlike the commission proposal killed by the Senate, Mr. Obama’s executive order could not force Congress to vote on a commission’s suggestions.

The vote on a commission proposal was the price that fiscally conservative senators extracted from Congressional Democratic leaders as the price for their support later this week in a vote to increase the $12 trillion debt limit. Without an increase, the government soon could not borrow to cover its obligations.

The proposal, co-sponsored by Senator Kent Conrad, Democrat of North Dakota, the chairman of the Budget Committee, and Senator Judd Gregg of New Hampshire, the committee’s senior Republican, called for an 18-member commission — eight lawmakers from each party and two administration officials — to draft a package that Congress would have to vote on in December without amending it.

After the vote, Mr. Conrad said he was “delighted” to have gotten 53 votes, adding, “I think that provides a significant boost to the momentum that is under way to begin to address the very deep challenge of a burgeoning debt.”

But Mr. Gregg, in a statement, said the outcome was “yet another indication that Congress is more concerned with the next election than the next generation.”

In an interview, however, Mr. Gregg would not commit to supporting a presidential commission. “It would still have no force of law to bind the Congress to do anything, and there really aren’t a whole lot of giants around here,” he said.

Sen. Evan Bayh's Prognosis: Democrats Must Move to the Middle

Gerald F. Seib writes in The Wall Street Journal:

Sen. Evan Bayh of Indiana, the very embodiment of calm understatement, seems an unlikely character to play the role of scold. But in recent weeks—particularly after last week's Massachusetts mauling—he has been scolding his Democratic Party, and sternly.

His message: Democrats and their president need to move decisively to the political center and root themselves there by showing they are serious about controlling spending and the deficit, which angry mainstream voters see as the real sign that Washington is out of touch.

Thus, while many Democrats complain that the Obama administration's problems arise because it hasn't been aggressive enough in pursuing a liberal agenda, Mr. Bayh arises to make the opposite case.

Many in his party, Mr. Bayh said, are "tone deaf" about the real message voters are sending, which is that Democrats have "overreached rather than looking for consensus with moderates and independents." He added: "It is amazing that some people here in Congress still don't get it.…For those people it may take a political catastrophe of biblical proportions before they get it. I don't think we'll get to that. But we might."

These are stern words from a man known more for rounding the edges of a debate than sharpening them. But they come from someone who knows a thing or two about Democrats wandering into political minefields.

Mr. Bayh saw it happen in his own family. His father, Birch Bayh, was a respected veteran senator from Indiana in his own right when the conservative Reagan Revolution snuck up in 1980 and washed him and a Democratic Senate majority out to sea.

Mr. Bayh has been sounding political alarm bells for weeks now over rising anger in the heartland.

Mr. Bayh was one of only three Democrats to vote against a massive, catch-all, end-of-year spending bill his party's leaders steered through Congress in December. He then asked Mr. Obama to veto it. In the aftermath of the vote, he put out a statement saying bluntly: "Washington is totally out of touch with mainstream America." Remember, that was well before Democrats lost that Massachusetts Senate seat.

"The only way Democrats can govern in this country is by making common cause with moderates and independents," he said. "It may be too late to regain them on health care. It's not too late to regain them on spending." To a president being pulled by some toward the left, and by others toward easy populism, Evan Bayh makes the case for driving a stake firmly in the political center instead.

David Brooks on the Populist Addiction

David Brooks writes in The New York Times:

Politics, some believe, is the organization of hatreds. The people who try to divide society on the basis of ethnicity we call racists. The people who try to divide it on the basis of religion we call sectarians. The people who try to divide it on the basis of social class we call either populists or elitists.

These two attitudes — populism and elitism — seem different, but they’re really mirror images of one another. They both assume a country fundamentally divided. They both describe politics as a class struggle between the enlightened and the corrupt, the pure and the betrayers.

Both attitudes will always be with us, but these days populism is in vogue. The Republicans have their populists. Sarah Palin has been known to divide the country between the real Americans and the cultural elites. And the Democrats have their populists. Since the defeat in Massachusetts, many Democrats have apparently decided that their party has to mimic the rhetoric of John Edwards’s presidential campaign. They’ve taken to dividing the country into two supposedly separate groups — real Americans who live on Main Street and the insidious interests of Wall Street.

It’s easy to see why politicians would be drawn to the populist pose. First, it makes everything so simple. The economic crisis was caused by a complex web of factors, including global imbalances caused by the rise of China. But with the populist narrative, you can just blame Goldman Sachs.

Second, it absolves voters of responsibility for their problems. Over the past few years, many investment bankers behaved like idiots, but so did average Americans, racking up unprecedented levels of personal debt. With the populist narrative, you can accuse the former and absolve the latter.

Third, populism is popular with the ruling class. Ever since I started covering politics, the Democratic ruling class has been driven by one fantasy: that voters will get so furious at people with M.B.A.’s that they will hand power to people with Ph.D.’s. The Republican ruling class has been driven by the fantasy that voters will get so furious at people with Ph.D.’s that they will hand power to people with M.B.A.’s. Members of the ruling class love populism because they think it will help their section of the elite gain power.

So it’s easy to see the seductiveness of populism. Nonetheless, it nearly always fails. The history of populism, going back to William Jennings Bryan, is generally a history of defeat.

That’s because voters aren’t as stupid as the populists imagine. Voters are capable of holding two ideas in their heads at one time: First, that the rich and the powerful do rig the game in their own favor; and second, that simply bashing the rich and the powerful will still not solve the country’s problems.

Political populists never get that second point. They can’t seem to grasp that a politics based on punishing the elites won’t produce a better-educated work force, more investment, more innovation or any of the other things required for progress and growth.

In fact, this country was built by anti-populists. It was built by people like Alexander Hamilton and Abraham Lincoln who rejected the idea that the national economy is fundamentally divided along class lines. They rejected the zero-sum mentality that is at the heart of populism, the belief that economics is a struggle over finite spoils. Instead, they believed in a united national economy — one interlocking system of labor, trade and investment.

Hamilton championed capital markets and Lincoln championed banks, not because they loved traders and bankers. They did it because they knew a vibrant capitalist economy would maximize opportunity for poor boys like themselves. They were willing to tolerate the excesses of traders because they understood that no institution is more likely to channel opportunity to new groups and new people than vigorous financial markets.

In their view, government’s role was not to side with one faction or to wage class war. It was to rouse the energy and industry of people at all levels. It was to enhance competition and make it fair — to make sure that no group, high or low, is able to erect barriers that would deprive Americans of an open field and a fair chance. Theirs was a philosophy that celebrated development, mobility and work, wherever those things might be generated.

The populists have an Us versus Them mentality. If they continue their random attacks on enterprise and capital, they will only increase the pervasive feeling of uncertainty, which is now the single biggest factor in holding back investment, job creation and growth. They will end up discrediting good policies (the Obama bank reforms are quite sensible) because they will persuade the country that the government is in the hands of reckless Huey Longs.

They will have traded dynamic optimism, which always wins, for combative divisiveness, which always loses.

I hope this isn't what Obama thought Scott Brown's election was primarily all about: Obama to Offer Aid for Families in State of the Union Address

From The New York Times:

President Obama will propose in his State of the Union address a package of modest initiatives intended to help middle-class families, including tax credits for child care, caps on some student loan payments and a requirement that companies let workers save automatically for retirement, senior administration officials said Sunday.

As is usually the case when the public speaks this loudly, the people are right: The process that produced House & Senate bills was an abomination.

David Ignatius has a excellent idea on how Obama can break the impasse that now exists -- through his own participation, contribution and lack of leadership --with health care in the context of America's biggest problem of political dysfunction, where our system isn't fixing problems that people care about such as health care.

His ideas come from a former chief executive of the Mayo Clinic the current chief executive of the Cleveland Clinic. Read his column for the specifics.

In discussing the health care legislation, he writes in The Washington Post:

Bay State reporting suggests that voters liked Obama well enough but they rejected the health-care monstrosity that has emerged in Washington after a year of congressional logrolling and special pleading. Judging by anecdotal evidence, people seem worried that the legislation will disrupt their existing care and balloon the deficit -- without really reforming the system.

As is usually the case when the public speaks this loudly, the people are right: The process that has produced the House and Senate bills has been an abomination. The voters sent Obama to Washington to lead, not to engage in endless horse-trading. When Sen. Ben Nelson demanded a tax exemption for his state of Nebraska as the price of his vote, that should have been a sign to the White House that the process had gone haywire. Instead, the administration agreed to similar buy-offs for the insurance industry and labor unions.

Bowing to the concerns of senators of both political parties, President Obama endorses bipartisan deficit-reduction panel.

From The Washington Post:

Bowing to the concerns of senators of both political parties, President Obama endorsed legislation Saturday that would create a bipartisan commission to develop a plan to address the nation's soaring budget deficits.

Obama previously had urged that a presidential fiscal panel be created. But some senators were concerned that such a panel would have limited authority, preferring instead a statutory commission empowered to force a deficit-reduction plan through Congress by year's end.

Rich: Obama has failed to deliver a coherent message on his health care, signal his imperatives & explain why and how it relates to economic recovery.

Frank Rich writes in The New York Times:

Tuesday’s special election was a dire omen for this White House. If the administration sticks to this trajectory, all bets are off for the political future of a president who rode into office blessed with more high hopes, good will and serious promise than any in modern memory.

[T]he master communicator in the White House has still not delivered a coherent message on his signature policy. He not only refused to signal his health care imperatives early on but even now he, like Congressional Democrats, has failed to explain clearly why and how reform relates to economic recovery — or, for that matter, what he wants the final bill to contain. Sure, a president needs political wiggle room as legislative sausage is made, but Scott Brown could and did drive his truck through the wide, wobbly parameters set by Obama.

Ask yourself this: All these months later, do you yet know what the health care plan means for your family’s bottom line, your taxes, your insurance? It’s this nebulousness, magnified by endless Senate versus House squabbling, that has allowed reform to be caricatured by its foes as an impenetrable Rube Goldberg monstrosity, a parody of deficit-ridden big government. Since most voters are understandably confused about what the bills contain, the opponents have been able to attribute any evil they want to Obamacare, from death panels to the death of Medicare, without fear of contradiction.

On the economic front, Obama needs both stylistic and substantive makeovers. He has stepped up the populist rhetoric lately — and markedly after political disaster struck last week — but few find this serene Harvard-trained lawyer credible when slinging populist rhetoric at “fat-cat” bankers. His two principal economic policy makers are useless, if not counterproductive, surrogates. Timothy Geithner, the Treasury secretary, was probably fatally compromised from the moment his tax lapses surfaced; now he is stalked by the pileup of unanswered questions about the still-not-transparent machinations at the New York Fed when he was knee-deep in the A.I.G. bailout. Lawrence Summers, the top administration economic guru, is a symbol of the Clinton-era deregulatory orgy that helped fuel the bubble.

Obama must also reconnect.

Last year the president pointedly studied J.F.K.’s decision-making process on Vietnam while seeking the way forward in Afghanistan. In the end, he didn’t emulate his predecessor and escalated the war. We’ll see how that turns out. Meanwhile, Obama might look at another pivotal moment in the Kennedy presidency — and this time heed the example.

The incident unfolded in April 1962 — some 15 months into the new president’s term — when J.F.K. was infuriated by the U.S. Steel chairman’s decision to break a White House-brokered labor-management contract agreement and raise the price of steel (but not wages). Kennedy was no radical. He hailed from the American elite — like Obama, a product of Harvard, but, unlike Obama, the patrician scion of a wealthy family. And yet he, like that other Harvard patrician, F.D.R., had no hang-ups about battling his own class.

Kennedy didn’t settle for the generic populist rhetoric of Obama’s latest threats to “fight” unspecified bankers some indeterminate day. He instead took the strong action of dressing down U.S. Steel by name. As Richard Reeves writes in his book “President Kennedy,” reporters were left “literally gasping.” The young president called out big steel for threatening “economic recovery and stability” while Americans risked their lives in Southeast Asia. J.F.K. threatened to sic his brother’s Justice Department on corporate records and then held firm as his opponents likened his flex of muscle to the power grabs of Hitler and Mussolini. (Sound familiar?) U.S. Steel capitulated in two days. The Times soon reported on its front page that Kennedy was at “a high point in popular support.”

Can anyone picture Obama exerting such take-no-prisoners leadership to challenge those who threaten our own economic recovery and stability at a time of deep recession and war? That we can’t is a powerful indicator of why what happened in Massachusetts will not stay in Massachusetts if this White House fails to reboot.

After Mass. vote, White House should accept this & need for Guantánamo & move on: Biden Says U.S. Will Appeal Blackwater Case Dismissal

From The New York Times:

Vice President Joseph R. Biden Jr. promised Iraqi leaders on Saturday that the United States would appeal the dismissal of manslaughter charges against five Blackwater Worldwide security contractors involved in a deadly shooting here that has inflamed anti-American tensions.

[The federal district court judge's dismissal, based on having read much of the opinion, will not be overturned, I assure you.]

Can Obama learn anything from the way Pres. Clinton recovered from electoral disaster for Dems in '94? I hope; he needs to go to the political center.

Gerald F. Seib writes in The Wall Street Journal:

[In 1994 and today,] a political statement made by voters seemed to invite a rethink of strategy and tactics.

The conventional wisdom says Mr. Clinton responded to that 1994 debacle by moving to the political center. In the parlance of the time, he began to "triangulate," or to take stands that positioned him between liberals of his own party and conservatives of the Republican Party.

That's certainly true, but a bit of an oversimplification. Mr. Clinton didn't simply reposition himself, but also shifted his priorities.

Famously, of course, he left behind efforts to overhaul health care. Then, in 1995, Mr. Clinton went against his party's orthodoxy by embracing a plan to balance the federal budget. And in 1996, he moved against Democratic orthodoxy again, by embracing a plan for wholesale changes to the welfare system.

He hardly turned his back on his own party in the process, though. Instead, he embraced more-conservative goals, while sometimes rejecting Republican tactics for achieving them. Thus, though he agreed on a plan to balance the budget, he confronted the GOP from the left on the specifics of spending bills designed to get that done. He vetoed a series of appropriations bills in 1995, ultimately leading to a temporary shutdown of much of the federal government that fall—which turned into a political disaster for Republicans, who absorbed most of the blame for letting it happen.

He also vetoed two versions of a welfare overhaul before finally signing a third in late 1996. Changing welfare was politically popular and, again, Mr. Clinton was the most obvious political beneficiary of the exercise.

In sum, Mr. Clinton engaged the opposition in a substantive way, while also reserving the right to battle with them over specifics. That repositioned the Clinton White House politically, of course, but also had the effect of compelling the Republicans to take a full share of responsibility. By engaging Republicans, in effect, he forced them to take a stake in failure as well as success.

So how much of this script could Mr. Obama follow? In his initial response to the Massachusetts loss, there was a hint of a move to the political center, particularly in his suggestion that he reposition himself on health care.

Similarly, the White House's emerging new focus on attacking the budget deficit will reposition Mr. Obama toward the middle on an issue that has great appeal there right now.

On other hand, the White House's move to double down on more regulation of big banks presages a much harder populist line, which is less in keeping with the Clinton reaction. And obviously, Mr. Obama simply can't move too far away from his party's congressional wing, which today, unlike in 1995 and 1996, still runs both the House and Senate.

It also will be harder to make Republicans take a full share of responsibility when they are still in the minority. A reasonable guess is that Mr. Obama will reposition himself, though not as drastically as did his Democratic predecessor.

Obama Moves to Centralize Control Over Party Strategy

From The New York Times:

Mr. Obama has asked his former campaign manager, David Plouffe, to oversee House, Senate and governor’s races to stave off a hemorrhage of seats in the fall.

The White House is searching for ways to respond to panic among Democrats over the possible demise of his health care bill and a political landscape being reshaped by a wave of populism.

[In his State of the Union address, r]ather than unveil a laundry list of new initiatives, advisers said, Mr. Obama will try to reframe his agenda and how he connects it with public concerns. In particular, he will focus on how his ideas for health care, energy and financial regulation all fit into the broader economic mission of creating what he calls a “new foundation” for the country, the key words being “rescue, restore and rebuild.”

While presidents typically experience rough patches, this one is particularly challenging for Mr. Obama. Liberals have grown disenchanted with what they see as his unwillingness to fight harder for their causes; independents have been turned off by his failure, in their view, to change the way Washington works; and Republicans have become implacably hostile.

The long and messy legislative fight over health care is a leading example of how Mr. Obama has failed to connect with voters, advisers say, because he appeared to do whatever it would take to get a bill rather than explain how people could benefit.

Union Membership Drops 10%

From The Wall Street Journal:

Organized labor lost 10% of its members in the private sector last year, the largest decline in more than 25 years. The drop is on par with the fall in total employment but threatens to significantly limit labor's ability to influence elections and legislation.

On Friday, the Labor Department reported private-sector unions lost 834,000 members, bringing membership down to 7.2% of the private-sector work force, from 7.6% the year before. The broader drop in U.S. employment and a small gain by public-sector unions helped keep the total share of union membership flat at 12.3% in 2009. In the early 1980s, unions represented 20% of workers.

Labor experts said the union-membership losses would have a long-term impact on unions and their finances, because unions wouldn't automatically regain members once the job market rebounded. In many cases, new jobs will be created at nonunion employers or plants.

Peggy Noonan: The New Political Rumbling -- Massachusetts may signal an end to old ways of fighting.

Peggy Noonan writes in The Wall Street Journal:

What does the Massachusetts election mean? It means America is in play again. The 2008 election settled nothing, not even for a while. Our national politics are reflecting what appears to be going on geologically, on the bottom of the oceans and beneath the crust of the Earth: the tectonic plates are moving.

America never stops moving now.

Massachusetts said, "Yes, we want change, but the change we want is not the change that has been delivered by the Democratic administration and the Democratic Congress. So we will turn elsewhere."

We are in a postromantic political era. They hire you and fire you, nothing personal. Family connection, personal charm, old traditions, fealty to party, all are nice and have their place, but right now we are immersed in crisis, and we vote on policies that affect our lives.

It is not the end of something so much as the beginning of something. Ted Kennedy took his era with him. But what has begun is something new and potentially promising.

President Obama carried Massachusetts by 26 points on Nov. 4, 2008. Fifteen months later, on Jan. 19, 2010, the eve of the first anniversary of his inauguration, his party's candidate lost Massachusetts by five points. That's a 31-point shift. Mr. Obama won Virginia by six points in 2008. A year later, on Nov. 2, 2009, his party's candidate for governor lost by 18 points—a 25 point shift. Mr. Obama won New Jersey in 2008 by 16 points. In 2009 his party's incumbent governor lost re-election by four points—a 20-point shift.

In each race, the president's party lost independent voters, who in 2008 voted like Democrats and in 2010 voted like Republicans.

Is it a backlash? It seems cooler than that, a considered and considerable rejection that appears to be signaling a conservative resurgence based on issues and policies, most obviously opposition to increased government spending, fear of higher taxes, and rejection of the idea that expansion of government can or will solve our economic challenges.

And it's taking place within a particular context.

Speaking broadly: In the 2006 and 2008 elections, and at some point during the past decade, the ancestral war between Democrats and the Republicans began to take on a new look. If you were a normal human sitting at home having a beer and watching national politics peripherally, as normal people do until they focus on an election, chances are pretty good you came to see the two major parties not as the Dems versus the Reps, or the blue versus the red, but as the Nuts versus the Creeps. The Nuts were for high spending and taxing and the expansion of government no matter what. The Creeps were hypocrites who talked one thing and did another, who went along on the spending spree while lecturing on fiscal solvency.

In 2008, the voters went for Mr. Obama thinking he was not a Nut but a cool and sober moderate of the center-left sort. In 2009 and 2010, they looked at his general governing attitudes as reflected in his preoccupations—health care, cap and trade—and their hidden, potential and obvious costs, and thought, "Uh-oh, he's a Nut!"

Which meant they were left with the Creeps.

But the Republican candidates in Virginia and New Jersey, and now Scott Brown in Massachusetts, did something amazing. They played the part of the Creep very badly! They put themselves forward as serious about spending, as independent, not narrowly partisan. Mr. Brown rarely mentioned he was a Republican, and didn't even mention the party in his victory speech. Importantly, their concerns were on the same page as the voters'. They focused on the relationship between spending and taxing, worried about debt and deficits, were moderate in their approach to social issues. They didn't have wedge issues, they had issues.

The contest between the Nuts and the Creeps may be ending. The Nuts just got handed three big losses, and will have to have a meeting in Washington to discuss whether they've gotten too nutty. But the Creeps have kind of had their meetings—in Virginia, New Jersey and Massachusetts. And what seems to be emerging from that is a new and nonsnarling Republicanism. It may be true—and they will demonstrate in time if it is true—that they have learned from past defeats, absorbed the lessons, reconsidered the meaning of politics. Maybe in time it will be said of this generation of Republicans what André Malraux said to Whittaker Chambers after reading his memoir, "Witness": "You did not come back from hell with empty hands."

For Mr. Brown now, everything depends on execution. He made the Olympics. Now he has to do the swan dive, with a billion people watching. And then he has to do it again.

He needs to serve the country the way he campaigned for votes—earnest, open, not beholden to interest or party. And he needs to avoid the Descent of the Congressional Vampires, who'll attempt to claim his victory as their own and suck from his neck until he's a pale and lifeless husk. Not to understate. But they'll want him fund-raising and speaking all over the country, not knowing or perhaps caring that the best work he can do for his party is succeeding in the eyes of his constituents, who couldn't care less about the fortunes of the GOP. He needs to avoid the vampires in the nicest possible way. Maybe he should carry a little cross deep inside his breast pocket so they retreat without knowing why: "I tried to get him to Boca for the donor retreat but some invisible force stopped me! I ran backwards and slipped on the shiny marble floor! Mah hip is out! "

In a telephone conversation Wednesday night, Mr. Brown spoke of what's ahead. The conversation turned to the movie "The Candidate," to the moment Robert Redford wins the election and takes a top strategist aside to ask: "What do we do now?"

Mr. Brown laughed: "I know what I want to do: Go down there and be a good person, a good and competent senator. I have huge shoes to fill, the legacy is just overwhelming. I'm a consensus builder. . . . I can disagree in the daytime and have a coffee or beer later on. Everyone's welcome to their opinion."

He said he thought the president "inherited a lot of problems," that "he's doing a great job with North Korea, a nice job with Afghanistan." A centerpiece of Mr. Brown's campaign was opposition to the president's health-care plan, but he stressed that he opposes high spending wherever it comes from. "I've criticized President Bush for his failure to use his veto pen. There's plenty of blame to go around. The question is how to solve problems. It's not bailouts. What made America great? Free markets, free enterprise, manufacturing, job creation. That's how we're gonna do it, not by enlarging government."

The next morning he took the 8 a.m. shuttle from Boston to Washington for his first trip to the Capitol. On the plane, after they took off, the pilot came on and said, "Senator Brown is on board, on his way to Washington." The plane erupted in applause.

That's a good way to begin. It reminded me of 12 months before, on the shuttle to Washington, with a plane full of people on their way to the inauguration of Barack Obama. The pilot spoke of it, and the plane erupted in cheers.

That feels like another era. Because America keeps moving, the plates keep shifting, and execution is everything. Everything.

The government bailed them out in 2008, why not again? The risk of moral hazard remains. -- Banks May Get Help to Escape Risk Limits

From The New York Times:

Only a year after the government stepped in to aid Goldman Sachs and Morgan Stanley by granting them access to the federal safety net, policy makers are developing an exit path that would allow them and others to escape limits on banks being proposed by the Obama administration.

President Obama wants to limit the scope of risk-taking by barring banks with federally insured deposits from trading securities for their own accounts and from owning hedge funds and private equity funds. The plan, policy makers said on Friday, would effectively require bank holding companies — which Goldman and Morgan became at the height of the financial crisis — to divest themselves of these lucrative operations.

But Treasury Department officials are also seeking to give banks that do not like the proposed rules the option of dropping their status as holding companies to keep their trading and other investment businesses.

Mr. Obama called the ban on trading “the Volcker Rule,” in recognition of the former Fed chairman, Paul A. Volcker . . . . Big losses by banks in the trading of financial securities helped fuel the credit crisis in 2008.

Bernanke’s Bid for a Second Term at the Fed Hits Resistance

From The New York Times:

The Obama administration struggled on Friday to secure confirmation of Ben S. Bernanke to a second term as chairman of the Federal Reserve, underscoring the political upheaval as both parties tried to find their footing amid a powerful wave of populism.

Two Democratic senators who are up for re-election this year announced that they would oppose Mr. Bernanke, whose four-year term as head of the central bank expires at the end of this month. Their decisions reflected a surge of opposition among some Democrats and Republicans to Mr. Bernanke, a primary architect of the bailout of the financial system and a contributor to policies that critics contend put the economy at risk in the first place.

By the end of the day, the White House had extracted a statement of support for Mr. Bernanke from the Senate majority leader, Harry Reid of Nevada, who had been noncommittal. Mr. Reid’s statement, issued after the markets closed, was intended to signal that Democrats, backed by some Republicans, could come up with the 60 votes necessary to break a deadlock and reconfirm Mr. Bernanke.

But even then Mr. Reid’s statement was remarkably unenthusiastic.

[S]ome influential Republican senators, including Judd Gregg of New Hampshire and Lamar Alexander of Tennessee, have said they will back Mr. Bernanke. [I do like Sen. Judd Gregg.]

Debt Ceiling Debate Begins

From The Wall Street Journal:

The Senate voted Thursday to wind down the Treasury's financial-market bailout plan as part a broader bill that would raise the government's debt ceiling, but the 53-40 tally serves only as a symbolic show of disapproval because a Senate rule requires 60 votes to pass any amendments to the legislation.

The proposal was the first of a series Republicans plan to offer as the Senate debates a bill to increase the amount of debt the government can issue by $1.9 trillion to $14.3 trillion.

The move to wind down the government's $700 billion Troubled Asset Relief Program, or TARP, . . . drew support from 13 Democrats along with all 40 Republicans [and] called for using unspent bailout funds to reduce the federal budget deficit.

The Democratic leadership opposed the amendment, saying it would handcuff Treasury Secretary Timothy Geithner's efforts to ensure the stability of financial markets.

Sen. Christopher Dodd, who voted against the amendment, said TARP funds should be used to make loans to small businesses struggling to tap the commercial-credit markets. The Connecticut Democrat said there is approximately $320 billion of unspent TARP money that could be at least partly used to stimulate private-sector job growth.

Republicans said the crisis facing financial firms has passed and that the Obama administration is trying to use TARP money as a slush fund to score political points.

They also are pushing for a freeze to federal discretionary spending for the next five years, and to cancel unspent money from last year's $787 billion economic-stimulus plan. Some senators also want legislation to create a commission made up primarily of lawmakers to come up with ways to tackle the country's long-term fiscal challenges. The Obama administration instead has proposed that a commission be created by the president's executive authority, but some senators have argued that such a panel would lack the requisite authority to force Congress to hold a vote on the commission's findings.

No surprise here. Workers are Americans & workers are angry, union or no union: AFL-CIO Poll Shows Union Households Boosted Brown

From The Wall Street Journal:

Republican Scott Brown's victory in the Massachusetts Senate race was lifted by strong support from union households, in a sign of trouble for President Barack Obama and Democrats who are counting on union support in the 2010 midterm elections.

A poll conducted on behalf of the AFL-CIO found that 49% of Massachusetts union households supported Mr. Brown in Tuesday's voting, while 46% supported Democrat Martha Coakley.

The finding, disclosed during an AFL-CIO conference call about the poll, represents a fresh problem for Democrats, who count on union leaders and union members as a pillar of the party's base.

Brooks: Obama (full of hubris) misinterpreted 2008 election as rejection of not only Bush-style conservatism, but also Bill Clinton-style moderation.

David Brooks writes in The New York Times:

In November 2008, William A. Galston and Elaine C. Kamarck wrote a report called “Change You Can Believe In Needs a Government You Can Trust.” Galston and Kamarck, who served in senior positions in the Clinton administration, threw up some warning flags for the incoming Obama administration.

Despite the Democratic triumph that month, they noted, public distrust of government remains intensely high. Historically, it has been nearly impossible to pass major domestic reforms in the face of that kind of distrust. Therefore, they counseled, the new administration should move cautiously to rebuild trust before beginning a transformational agenda.

The Obama administration interpreted the political climate in an entirely different way. As John F. Harris and Carol E. Lee wrote in a smart piece in Politico on Wednesday, the administration interpreted the 2008 election as a rejection of not only George W. Bush-style conservatism, but also Bill Clinton-style moderation. The country was ready for a New Deal-size change. It had a leader in Barack Obama who could uniquely inspire a national transformation.

As happens every four years, hubris defeated caution, and the administration began its big-bang approach.

As always, it backfired. Instead of building trust in government, the Democrats have magnified distrust. The country already believed Washington is out of touch with its core concerns. So while most families were concerned about jobs, Democrats in Washington spent nine months arguing about health care. The country was already tired of self-serving back-room deals, so the Democrats negotiated a series of dirty deals with the pharmaceutical industry, the unions and certain senators. Americans already felt Washington doesn’t understand their fears and insecurities. So at the moment when economic insecurity was at its peak, the Democrats in Washington added another layer of insecurity by threatening to change everything at once.

Instead of building a new majority, the Democrats have set off a distrust insurrection (which is not the same as a conservative insurrection). Republicans are enraged. Independents are furious. Democrats are disheartened. Health care reform is brutally unpopular. Even voters in Massachusetts decided it was time to send a message.

The Democrats now have four bad options. The first is what you might call the Heedless and Arrogant Approach. A clear majority of Americans are against the Congressional health care reform plan. Democrats could say: We know this is unpopular, but we think it is good policy and we are going to ram it through and you voters can judge us by the results.

The second route is what you might call the Weak and Feckless Approach. Democrats could say: We have received and respect the message voters are sending. We are not going to shove the biggest social transformation in a generation down the throats of a country that has judged and rejected it. We are not going to concentrate immense new powers in a Washington the country detests.

Instead, we will regroup and reorganize. Perhaps we will try incremental reforms. Perhaps we will use federal money to support a series of state reform efforts — like the one in Massachusetts — which are closer to the people. (In 2007, Russ Feingold, a Democrat, and Lindsey Graham, a Republican, co-sponsored the State-Based Health Care Reform Act to spark this kind of local experimentation.)

The third approach is the Dangerous and Demagogic Approach. This begins with the presumption that what Americans really want is a bunch of pseudopopulists to tell them they can have everything for free. This would mean stripping the health bills of anything that might be unpopular — like Medicare cuts and tax increases — and passing the rest regardless of the cost.

The fourth approach is the Incoherent and Internecine Approach. This would involve settling on no coherent policy but just blaming each other for cowardice and stupidity for the next month. Liberals, who make up 20 percent of the country, could complain because they didn’t get their version of reform. The Senate and the House could bash each other. The intelligentsia could bash the public.

Right now, Incoherent and Internecine is winning, but the hard choice is between the first two approaches. Galston, ironically, now supports Heedless and Arrogant. It was a mistake to rush into health care, he believes, but now that the party is down the road it would be suicide to turn back. Democrats should stand for what they believe in. If the policy works, then public trust will follow.

I support the Weak and Feckless Approach. Trust is based on mutual respect and reciprocity. If, at this moment of rage and cynicism, the ruling class goes even further and snubs popular opinion, then that will set off an ugly, destructive, and yet fully justified popular rebellion. Trust in government will be irrevocably broken. It will decimate policy-making for a generation.

These are the choices ahead. Have a nice day.

A New Search for Consensus on Health Care Bill

From The New York Times:

Lawmakers, Congressional aides and health policy experts said the [pared-back approach] package might plausibly include these elements:

¶Insurers could not deny coverage to children under the age of 19 on account of pre-existing medical conditions.

¶Insurers would have to offer policyholders an opportunity to continue coverage for children through age 25 or 26.

¶The federal government would offer financial incentives to states to expand Medicaid to cover childless adults and parents.

¶The federal government would offer grants to states to establish regulated markets known as insurance exchanges, where consumers and small businesses could buy coverage.

¶The federal government would offer tax credits to small businesses to help them defray the cost of providing health benefits to workers.

¶If a health plan provided care through a network of doctors and hospitals, it could not charge patients more for going outside the network in an emergency. Co-payments for emergency care would have to be the same, regardless of whether a hospital was in the insurer’s network of preferred providers.

The package could also include changes in Medicare, to reduce the growth in payments to doctors and hospitals while rewarding providers of high-quality, lower-cost care. To help older Americans, it could narrow a gap in Medicare coverage of prescription drugs, sometimes known as a doughnut hole.

A perfect storm made it possible for Scott Brown.

David Broder writes in The Washington Post:

Ron Kaufman, the longtime Republican National Committee member from Massachusetts, said that "it was a perfect storm" that made it possible.

"We had a really good candidate," Kaufman said. "A military veteran, a family guy, a fiscal conservative, moderate on social issues, a pro-choice Catholic. But it was bigger than that. The Democrats didn't understand that people here are very upset with the way things are going in Washington, just as they are elsewhere. They see big sums being spent, big deficits piling up, and they want to send a message."

Health-care reform -- the Democrats' chosen issue of 2009 and Kennedy's lifetime cause -- actually worked for the Republicans in this race. As Kaufman pointed out, Massachusetts enacted its own bipartisan health reform four years ago under Republican Gov. Mitt Romney, with Kennedy cheering, and that reform insured almost everyone in the state without raising taxes and without creating a government insurance company.

That allowed Brown to argue that he would vote against the legislation pending in Washington, which by comparison looks more expensive, more bureaucratic and more partisan than the Massachusetts model.

Yes!!: In a first test for court watchers, Sotomayor upholds death sentence

From The Washington Post:

The Supreme Court on Wednesday upheld the death penalty for an Alabama inmate whose attorney declined to present evidence about the man's mental deficiencies to a jury deciding his fate.

The 7 to 2 ruling was notable because it was written by Justice Sonia Sotomayor, her first full opinion on capital punishment since she joined the court. She said that while the wisdom of the lawyer's decision might be "debatable," it was not unreasonable to think he had made a strategic decision that kept out more damaging evidence about his client.

You got that right Brother (on disconnect part): President offers limited regrets for losing touch and disconnect with American people

From The New York Times:

Chastened and bruised, President Obama on Wednesday began the daunting process of trying to turn around his presidency in a drastically altered political environment that will test his leadership, his instincts and his political dexterity as never before.

With the loss of his party’s unilateral control of the Senate, Mr. Obama pivoted to acknowledge the deep public anger on display in Tuesday’s special election in Massachusetts, offering limited regrets for losing touch and signaling that he may scale back some of the sweeping ambitions he brought into office just one year ago to the day.
_______________

And from The Washington Post:

President Obama on Wednesday blamed the Democrats' stunning loss of their filibuster-proof majority in the Senate on his administration's failure to give voice to the economic frustrations of the middle class, a disconnect that White House aides vowed to quickly address as they continue to work to advance the president's agenda.

Both Parties Seek Ways to Channel Populist Ire

From The New York Times:

The remarkable Republican victory in Massachusetts demonstrated convincingly that the deep populist anger fueling the Tea Party movement has migrated from the political fringe to the mainstream, forcing both parties to confront how to channel a growing mood of public resentment to their own ends.

But it was impossible to judge whether the manner of Mr. Brown’s win would become the rule or an exception. National Republicans and the grass roots could easily find themselves in clashes over conservative dogma that ultimately weaken general election candidates.

Members of both parties agree the electorate is unsettled and unhappy. Many Americans see themselves as people who play by the rules but struggle to keep their heads above water while the government devotes its attention to saving those who made bad or irresponsible decisions, like bankers and auto executives.

“The loss in Massachusetts should serve as a wake-up call to the wing of the Democratic Party that wants the federal government to overreach and overspend,” said Senator Mary L. Landrieu, Democrat of Louisiana. “We need to get back to the basics.”

Scott Brown Victory Upends Senate and the President's Agenda

Scott Brown celebrated with his wife Gail Huff and daughters after defeating Democrat Martha Coakley in the U.S. Senate race on Tuesday night.

From The New York Times:

Scott Brown, a little-known Republican state senator, rode an old pickup truck and a growing sense of unease among independent voters to an extraordinary upset Tuesday night when he was elected to fill the Senate seat that was long held by Edward M. Kennedy in the overwhelmingly Democratic state of Massachusetts.

[How blue? Massachusetts is the only state that joined me as a young, wide-eyed liberal law student in voting for George McGovern over Richard Nixon in 1972.]

And after the results were announced, one centrist Democratic senator, Jim Webb of Virginia, called on Senate leaders to suspend any votes on the Democrats’ health care legislation until Mr. Brown is sworn into office. The election, he said, was a referendum on both health care and the integrity of the government process.
_______________

And from an article in The Washington Post entitled "Democrats find themselves on wrong end of the politics of discontent":

President Obama and the Democrats rode a wave of anger aimed at the presidency of George W. Bush to victories in 2006 and 2008. Now, a year to the day after Obama was sworn into office, in a dramatic reversal of fortunes, populist anger has turned sharply against the president and his party.

Given our nation's huge budget deficit, no more please, just quit please: Obama to seek $1.35 billion more for Race to the Top education program

From The Washington Post:

President Obama is slated to visit a Fairfax County school Tuesday to announce plans to seek $1.35 billion in his next budget to expand his signature education initiative to improve schools.

The $4.35 billion effort was enacted last year as part of the $787 billion economic stimulus plan, marking one of the largest federal expenditures ever on the nation's public schools.

While Race to the Top has piqued the interest of many states and school districts, others have turned their back on the prospect of new federal money, calling the reform agenda attached to it an intrusion on local educational prerogatives.

Thousands of school districts have declined to take part in the competition for the federal money, while some states have balked at the emphasis on charter schools.

David Brooks: The country is now split on Obama, because he is temperate, thoughtful and pragmatic, but his policies are almost all unpopular.

David Brooks writes in The New York Times:

When I was in college, I was assigned “Leviathan,” by Thomas Hobbes. On the cover was an image from the first edition of the book, published in 1651. It shows the British nation as a large man. The people make up the muscles and flesh. Then at the top, there is the king, who is the head and the mind.

When the Pilgrims left Britain to come to America, they left behind that metaphor as well. For these settlers, and the immigrants who have come since, the American nation is not a body with the government as the brain. Instead, America has been defined by its vast landscape and the sprawling energy of its entrepreneurs, scientists and community-builders.

In times of crisis, Americans rally around their government, but most of the time they have treated it as a supporting actor in national life. Americans are an unusual people, with less deference to central authority and an unparalleled faith in themselves. They seem to want a government that is helpful but not imperious, strong but subordinate.

Over the years, American voters have reacted against any party that threatens that basic sense of proportion. They have reacted against a liberalism that sought an enlarged and corrosive government and a conservatism that threatened to dismantle the government’s supportive role.

A year ago, the country rallied behind a new president who promised to end the pendulumlike swings, who seemed likely to restore equilibrium with his moderate temper and pragmatic mind.

In many ways, Barack Obama has lived up to his promise. He has created a thoughtful, pragmatic administration marked by a culture of honest and vigorous debate. When Obama makes a decision, you can be sure that he has heard and accounted for every opposing argument. If he senses an important viewpoint is not represented at a meeting, he will stop the proceedings and demand that it gets included.

If the evidence leads him in directions he finds uncomfortable, he will still follow the evidence. He is beholden to no ideological camp, and there is no group in his political base that he has not angered at some point in his first year.

But his has become a voracious pragmatism. Driven by circumstances and self-confidence, the president has made himself the star performer in the national drama. He has been ubiquitous, appearing everywhere, trying to overhaul most sectors of national life: finance, health, energy, automobiles and transportation, housing, and education, among others.

He is no ideologue, but over the past year he has come to seem like the sovereign on the cover of “Leviathan” — the brain of the nation to which all the cells in the body and the nervous system must report and defer.

Americans, with their deep, vestigial sense of proportion, have reacted. The crucial movement came between April and June, when the president’s approval rating among independents fell by 15 percentage points and the percentage of independents who regarded him as liberal or very liberal rose by 18 points. Since then, the public has rejected any effort to centralize authority or increase the role of government.

Trust in government has fallen. The share of Americans who say the country is on the wrong track has risen. The share who call themselves conservative has risen. The share who believe government is “doing too many things better left to business” has risen.

The country is now split on Obama, because he is temperate, thoughtful and pragmatic, but his policies are almost all unpopular. If you aggregate the last seven polls on health care reform, 41 percent support it and 51 percent oppose.

Many Democrats, as always, are caught in their insular liberal information loop. They think the polls are bad simply because the economy is bad. They tell each other health care is unpopular because the people aren’t sophisticated enough to understand it. Some believe they can still pass health care even if their candidate, Martha Coakley, loses the Senate race in Massachusetts on Tuesday.

That, of course, would be political suicide. It would be the act of a party so arrogant, elitist and contemptuous of popular wisdom that it would not deserve to govern. Marie Antoinette would applaud, but voters would rage.

The American people are not always right, but their basic sense of equilibrium is worthy of the profoundest respect. President Obama has shown himself to be a fine administrator, but he erred in trying to make himself the irreplaceable man in nearly ever sphere of public life. He erred in not sensing that even a pragmatic government could seem imperious and alarming.

If I were President Obama, I would spend the next year showing how government can serve a humble, helpful and supportive role to the central institutions of American life. Even in blue states like Massachusetts, voters want a government that is energetic but limited — a servant, not a leviathan.

Massachusetts Senate Candidates Push to Finish Line

Massachusetts vote in a crucial Senate race, Scott Brown, a Republican, faces Martha Coakley, a Democrat.

From The New York Times:

The questions now are whether the enthusiasm Mr. Brown has generated on the trail will translate into enough votes, and whether the Democratic establishment and labor unions supporting Ms. Coakley will be able to turn out voters the way they once did. The New England weather added another wrinkle to this unusual January special election: snow fell across much of the state on Monday, and more was forecast for Tuesday, making knocking on doors and standing on street corners a slushy affair.

Ms. Coakley should have the on-the-ground organizational advantage: her supporters were operating some 60 phone banks that have already made nearly 600,000 calls urging people to vote, and they expect to call a million voters by tomorrow. She also has more than 6,000 volunteers working for her election.

Mr. Brown, by contrast, listed 10 phone banks on his campaign Web site. One of them, in Littleton, Mass., had made 10,000 calls by 4:30 p.m., towards its goal of 15,000. Kurt Hages, a volunteer from Boxborough, Mass., said the campaign had been targeting independent voters.

Peggy Noonan: President Obama and the public are on different pages, if not in different books.

Peggy Noonan writes in The Wall Street Journal:

We're at the first anniversary of the inauguration of President Barack Obama, and . . . the word that captures its essence, is "Disconnect."

This is, still, a surprising word to use about the canny operatives who so perfectly judged the public mood in 2008. But they haven't connected since.

There is a disconnect, a detachment, a distance between the president's preoccupations and the concerns of the people. There's a disconnect between his policy proposals and the people's sense, as expressed in polls, of what the immediate problems are.

You want a competent chief executive with a deep and shrewd sense of the people. Americans want him to be on the same page as they are. But he's on a different page, and he may in fact be reading a different book.

The people are here, and he is there. The popularity of his health-care plan is very low, at 35% support. Someone on television the other day noted it is as low as George Bush's popularity ratings in 2008.

Yet—and this is the key part—the president does not seem to see or hear. He does not respond. He is not supple, able to hear reservations and see opposition and change tack. He has a grim determination to bull this thing through. He negotiates each day with Congress, not with the people. But the people hate Congress! Has he not noticed?

The people have come alive on the issue of spending—it's too high, it threatens us! He spends more. Everywhere I go, I hear talk of "hidden taxes" and a certainty that state and federal levies will go up, putting a squeeze on a middle and upper-middle classes that have been squeezed like oranges and are beginning to see themselves as tired old rinds. Mr. Obama seems at best disconnected from this anxiety.

The disconnect harms him politically, but more important it suggests a deepening gulf between the people and their government, which only adds to growling, chafing national discontent. It also put the president in the position, only one year in, only 12 months into a brand-new glistening presidency, of seeming like the same old same old. There's something tired in all this disconnect, something old-fashioned, something sclerotic and 1970's about it.

And of course the public is reacting. All politicians are canaries in coal mines, they're always the first to feel the political atmosphere. It was significant when the Democrats lost the governorships of Virginia and New Jersey two months ago. It is significant that a handful of House and Senate Democrats have decided not to run this year. And it is deeply significant that a Republican state senator in Massachusetts, Scott Brown, may topple the Democratic nominee to fill Ted Kennedy's former seat, Martha Coakley. In a way, the Republicans have already won—it's a real race, it's close, and in "Don't blame me, I'm from Massachusetts"!

Mr. Brown's whole story right now is not about disconnect but connect. Massachusetts has an 8.8% unemployment rate, and graduates of the commonwealth's great universities can't find work. An old Boston Republican hand said of the race, "It's 100% about policies—health care, taxes, what's the plan on the economy?"

Ms. Coakley has the advantage—Massachusetts is the heart of blue-state America—but in a way her advantage is her curse. Because she is the candidate of a party that for 40 years has been used to winning, reigning and winning again, she looks like the same old same old, a standard old-line liberal, the frontwoman for a machine, a yes woman for the Obama-Pelosi era.

Politics is about policy. It's not about who's emotional and who cries or makes you cry. It's not about big political parties and the victories they need in order to rule. It's not about going on some ideological toot, which is what the health-care bill is, hoping the people will someday see and appreciate your higher wisdom.

In a way, Mr. Obama's disconnection is a sign of the times. We are living in the age of breakup, with so many of the ties that held us together loosening and fraying. If the president wants to lead toward something better, he should try listening. If you can't connect through the words you speak, at least you can do it through your ability to hear.

Speaker Ralston's interesting take on 'hawks' (lawmakers who had the authority to join any committee at any time in order to push a particular vote)

From the AJC's Political Insider:

House Speaker David Ralston . . . .[last Friday and as previously promised,] rescinded the appointment of all “hawks” – lawmakers who carried the authority to join any committee at any time in order to push a particular vote.

“While this system was initiated to enable House committees to more readily meet their quorum requirements, it has become a tool used strictly for partisan purposes,” Ralston said. “Under my leadership, I am committed to working across the aisle and ensuring an equal voice to all House members no matter their party affiliation.”

From the Cracker Squire Archives: In 'I Have a Dream,' our native son let the thousands assembled in Washington, D.C. know that he was from Georgia

The March on Washington for Jobs and Freedom was a large political rally during which King delivered his historic "I Have a Dream" speech advocating racial harmony at the Lincoln Memorial.

From a 1-15-07 post containing excerpts from "I Have a Dream" as delivered by Dr. Martin Luther King, Jr. on August 28 1963:

"[G]o back to Georgia . . . knowing that somehow this situation can and will be changed."

"I have a dream that one day on the red hills of Georgia the sons of former slaves and the sons of former slaveowners will be able to sit down together at a table of brotherhood."

"I have a dream that my four children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character."

"[L]et freedom ring from Stone Mountain of Georgia! . . . When we allow freedom to ring, when we let it ring from every village and every hamlet, from every state and every city, we will be able to speed up that day when all of God's children, black men and white men, Jews and Gentiles, Protestants and Catholics, will be able to join hands and sing in the words of the old Negro spiritual, "Free at last! free at last! thank God Almighty, we are free at last!"

Piñera is expected to maintain close ties with the U.S., unlike the leaders of several other leftist governments in Bolivia, Nicaragua & Venezuela.

From The Washington Post:

Sebastian Piñera, a conservative billionaire businessman, won the presidency of Chile on Sunday, ending a generation of rule by a center-left coalition that had overseen the transformation of the country of 17 million into Latin America's most politically stable and economically dynamic.

Political analysts say Piñera will stay on the same free-market course pursued by Concertacion leaders while maintaining popular social programs that have given Chile Latin America's lowest poverty rate.

Piñera is expected to maintain close ties with the United States, unlike the leaders of several other leftist governments in Latin America, notably in Bolivia, Nicaragua and oil-rich Venezuela.

Piñera has barely hidden his disdain for the region's more left-leaning leaders. He told a group of foreign reporters last month that he admired leaders such as Brazilian President Luiz Inacio Lula da Silva and Peruvian President Alan Garcia, both market-friendly presidents.

Bolivia could prove to be a particularly nettlesome problem for Piñera. That neighboring, landlocked country, led by President Evo Morales, a close ally of Venezuelan firebrand Hugo Chavez, has been demanding access to the sea through Chile's remote north, a region the Bolivians lost in a 19th-century war.

You got that right Vicki Kennedy: "The eyes of the country are on us. What we do here is going to be the shot heard round the world."

President Obama hugs Martha Coakley, the Democratic state attorney general running for U.S. Senate against Republican state Sen. Scott Brown.

From The Washington Post:

President Obama made a last-ditch effort Sunday to resurrect the candidacy of a struggling Democrat who could provide him a critical Senate vote, returning to the city that launched him onto the national stage in 2004, this time to preserve his ambitious agenda.

Obama urged Massachusetts voters to send state Attorney General Martha Coakley to the U.S. Senate to succeed the late Edward M. Kennedy (D-Mass.) in a surprisingly close race that has taken on national implications both legislatively and politically. An upset victory on Tuesday by state Sen. Scott Brown (R), who was an afterthought a month ago in this Democratic-dominated state, would give Senate Republicans 41 votes, enough potentially to scuttle the sweeping health-care legislation that is the president's top domestic agenda priority. Republicans also think that claiming Kennedy's old seat, under his family's control since 1953, would be a political jolt that could herald big gains in November's midterm elections.

Obama, whose 2004 address to the Democratic convention here set him on an arc to winning the presidency, said his entire domestic agenda -- from financial regulatory reform to climate change legislation -- would be at risk with a Brown win.

Brown's momentum has been fueled by his success in tapping voter anger about double-digit unemployment and massive federal spending.
Democratic strategists privately suggested that liberal activists who were slow to engage in the race were now mobilized, stemming what had been growing momentum for the upstart Republican.

"The eyes of the country are on us. What we do here is going to be the shot heard round the world," Vicki Kennedy told union leaders Sunday in Quincy.

Mass. Race Tests Staying Power of Dems (I am catching up from being gone over the weekend. I wish I had read this before my similar post of today.)

Martha Coakley, right, with Victoria Reggie Kennedy, the widow of Senator Edward M. Kennedy.

From The New York Times:

There may be no better place to measure the shifting fortunes of President Obama and the Democratic Party than in the race being fought here this weekend for the Senate seat that had been held by Edward M. Kennedy.

When Mr. Obama was inaugurated one year ago this week, he and his party had big majorities in the Senate and House, enjoyed the backing of much of the country and were confidently preparing to enact an ambitious legislative agenda. Republicans seemed directionless and the conservative movement exhausted.

This weekend, Democrats are struggling to hang on to a seat held by Mr. Kennedy for 46 years in one of the most enthusiastically Democratic states in the country. Conservatives are enjoying a grass-roots resurgence, and Republicans are talking about taking back the House in November.

As Mr. Obama prepares to come here on Sunday to campaign for the party’s beleaguered Senate candidate, Martha Coakley, Democrats across the country are starting to wonder aloud if they misjudged the electorate over the last year, with profound ramifications for the midterm elections this year and, potentially, for Mr. Obama’s presidency.

Win or lose in Massachusetts, that a contest between a conservative Republican and a liberal Democrat could appear so close is evidence of what even Democrats say is animosity directed at the administration and Congress. It has been fanned by Republicans who have portrayed Democrats as overreaching and out of touch with ordinary Americans.

Mr. Obama’s decision to tear up his weekend schedule to come here reflects concern in the White House that a defeat of Ms. Coakley would be seen as a repudiation of the president’s first year. It would also raise the question of whether Mr. Obama squandered political capital by focusing so much on health care at a time of rising unemployment.

The Massachusetts campaign has neatly encapsulated the major themes that have come to deplete Mr. Obama’s popularity, themes that have fueled the rise of the Tea Party movement on the right and created an atmosphere where growing numbers of Democrats in conservative-leaning districts and states have decided not to run again.

[State Senator Scott] Brown is running directly against the health care plan, and Ms. Coakley is standing by it.

Mr. Brown has portrayed Ms. Coakley as an advocate of big government, big spending and big deficits; Obama advisers and other Democrats have worried that the expanding deficit, now at a level not seen since World War II, was hurting Mr. Obama with independents who lifted him to victory in 2008. Polls suggest that those voters have flocked to Mr. Brown, as they did to Republican candidates for governor in Virginia and New Jersey last year.

Mr. Brown has also portrayed Ms. Coakley — and by inference, her party — as acting as if she were entitled to the Kennedy seat, a perception Ms. Coakley reinforced by at first running an extremely lackadaisical campaign. With populist anger running strong, anything that smacks of establishment entitlement is politically dangerous.

[M]ost ominously for Democrats contemplating the midterm elections, the battle here suggests an emerging dangerous dynamic: that Mr. Obama has energized Republican activists who think he has overstepped with health care and the economic stimulus, while demoralizing Democrats who think he has not lived up to his promise.

[S]ome Democrats are wondering if Mr. Obama would be in a better position now if he had embraced a less ambitious health care proposal, as some aides urged, permitting him to pivot more quickly on the economy. Depending on what happens Tuesday, that is a debate that might be reverberating in the White House for a long time to come.
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The above Times articles says Martha Coakley has run "an extremely lackadaisical campaign." This is kind. It will go down and be remembered as one of the worst run, most arrogant campaigns conducted in years.