Plan B, If Leaders Have the Courage to Execute It

I see trees of green, Red roses too, I see them bloom

For me and you. And I think to myself, What a wonderful world.

Even Louie Armstrong's songwriters (their lyrics above) wasn't as divorced from reality as this economist, as well as others who want Joe Biden to persevere:

be a huge improvement -- would tear Trump to shreds https://t.co/na8qqsbJCi

— Dean Baker (@DeanBaker13) June 28, 2024

The main task now is to defeat Donald Trump and the Republican Party which adores him and would view his election as confirmation of its obeisance to a candidate who has openly advocated termination of the Constitution. Thanks go to Pete Buttigieg for his service to his country serving in Iraq. However, my guess is that the American people are not yearning to vote for a short, small, gay man. And as a nominee for President, he'd have to answer for the Administration's response- or lack thereof- to the Norfolk Southern train derailment in East Palestine.

Also, a white man. The Democratic Party is not going to persuade Biden to throw in the towel and consider an alternative to the sitting Vice President in order to nominate a white male, especially if his name does not rhyme with "Calvin Gruesome." This pertains to a statement about the incumbent President- threat, really- uttered by Democratic strategist Karen Finney, reported last September and which I've quoted several times:

When you had people who were trying to test the waters, the party rose up and made it clear to those individuals — who were mostly white men — that to disrespect the vice president would not be well received by women and people of color within the party. They got a little bit of a smack in the face. 

President Biden now is dead man walking, thus Kamala Harris, dead woman walking. Twisting Joe Biden's arm to persuade him to exit the race no longer would be disrespecting either of them. Joe Biden is concerned about not only the country, but also about the Democratic Party and his own legacy. Continuing with this charade of a race would doom a great many Democrats down ballot and tarnish substantially and irreparably his own legacy.

So, what to do? 

If you're the last ex-President of the Democratic Party, you convene a gathering of party leaders and other possibly influential parties. It should be not very long nor very short and in addition to Barack Obama, probably should include Eric Holder, former Attorney General, now head of the National Democratic Redistricting Committee; Nancy Pelosi, former House Speaker, still a congresswoman and party heavyweight; Nanette Diaz Barragan, head of the Hispanic Congressional Caucus; Representative James Clyburn, who made Joe Biden the 2020 nominee; perhaps Val Demings, formerly both a police chief and US Representative from Florida; and Senate Majority Leader Chuck Schumer, because even the Democratic Party needs a white male here and there. One or two of these may balk at being involved and could be replaced by another individual.

The group's major order of business would be to agree upon a viable alternative to Mr. Biden and Ms. Harris, the latter of whom was selected by candidate Biden and who is even less popular (at least until Thursday night) than the President. It must, however, be a package deal, with both a Presidential and Vice Presidential nominee selected.

I'm partial to to the sound of "President Sherrod Brown" or "President Rafael Warnock." However, the latter may not be saleable to the American electorate and the former not saleable to the Party. (See "Finney, Karen" above.) And now is not the time to be stuck on our favorites, nor on the incumbent being the best President of our lifetime, even of those of us who are elderly

Therefore, given the overriding importance of defeating Donald Trump and of electing Democrats throughout the country, would be Michigan governor Gretchen Whitmer in the top spot and the young governor of Maryland, Wes Moore, in the bottom spot.

Agreement would have to be reached with those two individuals, contingent on President Biden bowing out. The latter is the easy part; if there is a consensus ticket determined and Joe Biden does not step aside, the Party has a far greater problem than it now appears to have. And I think it very unlikely that under those circumstances, Mr. Biden wouldn't discover that the needs of party and country are greater than his own.

And if he doesn't, we will learn that the Democratic nomination for President is worth about as much as John Nance Gardner reportedly believed the vice-presidency to be: "not worth a bucket of warm spit."

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Tweet of the Day- Recession Doesn't Look Good in Any Color

In an article in February describing recent moves regarding nominations to the Federal Reserve, The Washington Post noted "the seven-member Fed Board of Governors is in charge of keeping prices stable and fostering maximum employment, along with regulation of the banking system."

The Board of Governors, under chairperson Jerome S. Powell, clearly is focused on preventing inflation from climbing further and disinterested in fostering employment.

Hey Sherrod, I'm happy for that. But, if our America-looking Fed raises rates enough to give us a bad recession, I will not be happy (and neither will America).

— Dean Baker (@DeanBaker13) September 23, 2022

In Senator Brown's "look like America," he evidently was referring to approval to the Board of Governors of the Federal Reserve System Michelle W. Bowman (who looks like a white woman), Lisa D. Cook (who looks like a black woman), and Philip N. Jefferson (who looks like a black man) to joing Lael Brainard (who looks like a white woman), Christopher J. Waller, Michael s. Barr, and Powell (who looks like a white man). There was no one who appears to be of Latin or Asian descent but the Board did then look a little more like America than it did with all white people.

If President Biden's appointees steer the Fed in the proper direction, one which will benefit Americans even if major banks suffer, lending  diversity to the Board will have been a major improvement.

Policy should triumph over an officials' appearance or racial makeup. Unfortunately, the generally wise Sherrod Brown had voted in favor of Jerome Powell's reappointment as Board chairperson. It appears that Powell, whose reappointment the generally wise Sherrod Brown supported, is satisfied with prompting a recession in hopes of stemming inflation. If that ensues, as now appears likely, white women, black women, and black men will be among the Americans crushed financially.

 

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Same Old GOP Tune

While Project Lincoln- "racist, pure and simple"- is wrong, thee is probably even more wisdom in the tweet than even PSU Blaze himself realizes:

I don’t remember Senator Kennedy calling Melania “comrade”

— PSU Blaze (@PSU_Blaze) November 18, 2021

Saule Omarova is President Biden's nominee to be head of the Office of the Comptroller of the Currency. As noted here, "Originally from Kazakhstan, Omarova was educated in Moscow before coming to the United States in 1991 on a student exchange program in the Political Science Department at the University of Wisconsin-Madison."

Kazakhstan is a small, sparsely populated nation in central Asia and was the last jurisdiction to declare its independence from the Soviet Union, in the same year that Omarova left to study in the USA.

Omarova earned a doctorate at Wisconsin and a law degree from Northwestern University, later serving as a senior advisor in the United States Treasury under Bush 43.  According to Senate Banking, Housing, and Urban Affairs chairperson Sherrod Brown, Omarova has "published dozens of works" pertaining to finance and "more than 70 financial regulatory experts from across the political spectrum, including bankers, have endorsed her nomination."

That, and Omarova's expertise as a staunch critic of concentration in the financial services industry, earned Senator Kennedy's cheap shot. He never did call Melania Trump "comrade," because she is the wife of the president to whom John Kennedy has pledged his allegiance. 

Bigotry is selective. Republicans even have their own black senator, South Carolina's Tim Scott, who vehemently opposes Omarova because, well, let Matthew Stoller explain:

I've read Omarova's work for about a decade. It's very clear that she is a foe of too big to fail banks, reckless bailouts, and speculative excess. The right, as usual, simply cannot see policy alignment when it's a Democrat making the case.

But she poses an even bigger threat than that for Republican donors.

Omarova is being opposed for just one reason. She understands banking.

The first tweet indicates why champagne corks were popped by the financial services industry when Bernie Sanders was eliminated in the stretch round for the Democratic presidential nomination. But it's why the bigger celebration probably occurred earlier when Elizabeth Warren was effectively eliminated in the race. And it leads us to factors aside from race or national background to the recognition that when push comes to shove, Republican legislators will always side with capital over consumer, with profits over people.

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Problem Of A Different Sort

Two days after the mid-terms, the Daily Beast reported

“I think he’s a fantastic politician in the best sense of the word,” (Bernie) Sanders said of Gillum. “He stuck to his guns in terms of a progressive agenda. I think he ran a great campaign. And he had to take on some of the most blatant and ugly racism that we have seen in many, many years. And yet he came within a whisker of winning.”

However, Sanders conceded also "I think you know there are a lot of white folks out there who are not necessarily racist who felt uncomfortable for the first time in their lives about whether or not they wanted to vote for an African-American."

Having failed to label multitudes of white voters as "racist," the naughty Senator brought down upon himself a torrent of Twitter criticism, including "not feeling comfortable voting for a black person because they’re black indeed means that person is racist;" "Folks have to stop excusing racism/sexism as a means of normalization in hopes not to hurt the perpetrators feelings;" and "What do you call a person who is uncomfortable voting for a Black person? A RACIST."

In response to a fellow tweeting out a January, 2015 Washington Post article entitled "Sherrod Brown: Why aren't progressives begging him to run for president?"Jill Filipovic ( though right about this and this), unaware of the buzz surrounding senators Kamala Harris and Amy Klobuchar, contends

No shade to Sherrod, but can we see more of these articles about women (especially the many qualified women of color on the Dem bench) and more discussion of female candidates as presidential hopefuls? The midterms showed us who votes Dem, and it's not white men.

Then in equal parts disturbing and predictable

Nancy Pelosi is making gender a central part of her bid to reclaim the speaker’s gavel — leaning hard into the pitch that Democrats cannot oust the only woman at their leadership table following a historic election for women.

In addition to arguing she’s the best qualified for the job, the California Democrat and her allies are also framing a Pelosi victory as a matter of protecting political progress for women at a critical moment. Push her out, and men may take over the party at a time when more than 100 women are heading to Capitol Hill and after female voters have been thoroughly alienated by President Donald Trump. Embrace her, and she’ll prioritize legislation empowering women on issues ranging from equal pay to anti-harassment legislation.

This sentiment, assessing an individual's value on the basis of the inherited characteristics of race and gender, is pervasive but all too infrequently acknowledged. This past Monday, Slate's Jordan Weissman wrote that newly re-elected Ohio senator Sherrod Brown

isn’t the only candidate who needs to make this sort of tough calculation. Instead of running for president, Beto O’Rourke could try to go after Texas Sen. John Cornyn’s seat in 2020. Montana Governor Steve Bullock might be interested in the Oval Office. But he might be be more useful taking on on Republican Sen. Steve Daines. West Virginia’s Richard Ojeda, who went so far as to announce his presidential bid on Monday after losing his House bid last week, might do better to try to knock off Sen. Shelley Moore Capito. But with Brown, the tension is a bit more clear, both because he’s such a compelling presidential candidate on paper, and because winning the presidency would actually guarantee that his Senate seat flipped, rather than simply remain in Republican hands.

There are also other reasons why Brown might not be an ideal Democratic standard bearer. He’s loudly sided with Trump on trade issues, which may be a big part of his secret to winning in Ohio, but might not play well with progressive primary voters who loathe pretty much all things about the administration. And while his Republican opponent failed to make much of an old domestic abuse allegation, that issue could play awkwardly on the national stage. (The issue involve some nonspecific accusations made by Brown’s ex-wife during their divorce in the 1980s. She has since become one of his most vocal political supporters, and cut a TV ad for him this year after Republicans tried to revive abuse claim during the campaign).

But ultimately, the question hanging over Brown isn’t whether he’s a good candidate, or even a great one. It’s whether he’s so much better than the other 2020 contenders that it would be worth waving his Senate seat goodbye.

Nonetheless, were Brown to be nominated and elected, he would be president, a rather more important office than senator.  Were he not elected- or not even nominated- he would remain a US Senator, no harm done.

Moreover, Weissman's inclusion of Richard Ojeda, now holding no political office, and of Beto O'Rourke, now holding no political office after his defeat by Ted Cruz, suggests that his concern may be motivated by more than concern of Brown's seat being taken by a Republican. 

It may be that Weissman is feeling a touch of that sentiment held by Filipovic, some Pelosi supporters, and members of the Twittersphere who find Bernie Sanders is insufficiently critical of voters who vote against a black candidate.

Sherrod Brown is a white male.  No Democrat (or Republican), and that includes an estimable senator from the nation's heartland, can be elected President without first being nominated for the office. While Weissman's article is entitled "The Really Obvious Problem With Sherrod Brown Running for President," the really obvious problem for Brown is demographic, and one he is powerless to change.

Following the 2016 elections, Senator Sanders asserted

It is not good enough for somebody to say "I'm a woman, vote for me." No, that's not good enough. What we need is a woman who has the guts to stand up to Wall Street, to the insurance companies, to the  drug companies, to the fossil fuel industry. In other words, one of the struggles that you're going to see in the Democratic Party is whether we go beyond identity politics.

"Crushing truths perish from being acknowledged," Albert Camus once noted. Whether the Party goes beyond "identity politics," it shouldn't be prohibitively difficult for the left and journalists (such as Weissman) sympathetic to a Democratic agenda to concede, openly and clearly, the role that gender and race play in the Party.

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Sorry. The Money Is All Gone.

In floor debate in late November, Senate Finance Committee chairperson Orrin Hatch, who worked with the late Senator Edward Kennedy to create the Children's Health Insurance Program, assured Ohio Senator Sherrod Brown "We're going to get CHIP throught. There's no question about that. I'm going to see that it gets through."

Politico's Haberkorn reported Friday that the Utah Republican stated “We’re going to take good care of CHIP. I can’t tell you exactly when, but we’ll get it done.”

With Republicans in favor of the program and Democrats completely committeed to it, CHIP will sometime in the near future be reauthorized.

Still, Haberkorn added

House Republicans on Wednesday released a spending bill that would fund CHIP for five years but pay for it with cuts to Obamacare and other programs that Senate Democrats would not support. The bill would need Democrats' help to get through the Senate.

Nice little program you got there- it would be a shame if something happened to it.  The GOP is quite willing to fund children's health care- provided that it can chip away at the social safety net elsewhere.

The hostage may be released, but the GOP is bound and determined that a heavy price is paid. It is, after all, the secondary motive for a disastrous tax bill, the primary motive being to please the Party's donors.  Hatch himself gave it away when in the largely empty chamber with Brown, he contended

We're going to do CHIP. There's no question about it in my mind. And it's gotta be done the right way. But- the reason CHIP's having trouble is that we don't have any money anymore. We just add more and more spending and more and more spending and you can look at the  rest of the bill for more and more spending.





"It has to be done the right way... we don't have any money anymore," remarked the Senator who unreservedly voted for the GOP tax plan, targeted to increase the debt by something north of $1 trillion. Excited at the pospect of slashing Medicaid, Speaker Paul Ryan at a conservative event in March bragged to the editor of the National Review "Sending it back to the states, capping its growth rate. We have been dreaming of this since I have been around, since you and I were drinking at a keg.”

Shortly before triumphantly pushing through his chamber the Corporate Tax Cut Sham of 2017, Ryan maintained at a town hall meeting "You cannot get the national debt under control, you cannot get that deficit under control, if you don’t do both — grow the economy, cut spending."  Ryan had commented in a radio interview . "Frankly, it's the health care entitlements that are the big drivers of our debt, so we spend more time on the health care entitlements — because that's really where the problem lies, fiscally speaking."

Frankly, the Speaker dares not utter the words "Medicaid" or "Medicare," and while more detached than Hatch, he's a little more subtle, or at least wonkier. So carrying water for Ryan, Politico's Alberta and Bade characterize the Speaker's goal as "entitlement reform," in which he "tackles what he sees as the systemic problems with Social Security, Medicare and Medicaid." Charlie Pierce recognizes “'what he sees as being systemic problems' with Social Security, Medicare, and Medicaid are that those programs exist at all."

Senator Marco Rubio echoes Ryan's call that Congress "structurally reform" earned benefits. More candid than the Speaker or Hatch, the Florida Republican stated

The only way you are going to deal with the debt is you have to do two things. ... You have got to generate economic growth because growth generates revenue. But you also have to bring spending under control. And not discretionary spending. That isn’t the driver of our debt... The driver of our debt is the structure of Social Security and Medicare for future beneficiaries.

The good news is that individuals currently elderly probably will be left somewhat, relatively, unharmed. Perhaps Hatch and his merry band of oligarchs with a daddy complex will "take care" of people now in retirement age or close to it because elderly people vote. Health care for children also- to whatever extent- will be provided. But all those people in between better hold onto their wallets. The Republican Senate and Republican Senate are coming for you- unless, of course, your parents leave their $11 million estate to you when they die.




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Don't Take It Personally, Senator. He Just Doesn't Like People.

The surprise should be that it took so long to happen- and is so limited.

Last month, criticizing Massachusetts Senator Warren on MSNBC's Hardball, President Obama stated "I love Elizabeth. We're allies on a whole host of issues. But she's wrong on this. Last weekend, Obama charged "The truth of the matter is that Elizabeth is, you know, a politician like everybody else.”

After the Senate (at least temporarily) yesterday blocked the Trade Promotion Authority (fast track authorization) the President had been aggressively seeking, Senator Sherrod Brown (D-Ohio), an ally of Senator Warren on the matters of trade, financial regulation, and giving a helping hand to the middle class, remarked “I think the president was disrespectful to her by the way he did that... I think that the president has made this more personal than he needed to.”

Had Senator Brown been less respectful himself, he might have noted that, following Obama's initial criticism of Warren, the President misleadingly claimed

Every single one of the critics saying this is a secret deal, or send out e-mails to their fundraising base that they're working to stop a secret deal, could walk over and see the text of the agreement. When I just keep on hearing people repeating this notion that it's secret -- I gotta say, it's dishonest. And it's a little concerning when I see friends of mine resorting to those sort of tactics.

Were Brown less reserved, he might have mentioned that the person making that statement has decided that this non-secret deal is a national security matter. On the floor of the Senate, an exasperated Senator Barbara Boxer explained (video below)








The guard says, "you can’t take notes." I said, "I can’t take notes?’” "Well, you can take notes, but have to give them back to me, and I’ll put them in a file." So I said: "Wait a minute. I’m going to take notes and then you’re going to take my notes away from me and then you’re going to have them in a file, and you can read my notes? Not on your life."

I gotta say, it's dishonest, swears the guy who maintains it is not a secret deal, although a Senator is subject to prosecution if she reveals anything about it. As Joseph Stiglitz told Chris Hayes

Well, to put it quite bluntly, I think from what we`ve been able to see of the TPP, you have to remember, USDR keeps these trade agreements secret and the only reason we know about it is from WikiLeaks (ph) and in my case, talking to negotiators from other countries where there`s a little bit more transparency than the United States.

From what we`ve been able to see, this is a very bad agreement. It`s not just about trade. The trade part is bad enough. But it`s about intellectual property, regulation.

While Brown called Obama "disrespectful," he could have knocked him for being dishonest. Patronizing might have come into play, also.  It wouldn't be the first time for Obama, who infamously on the campaign trail in 2008 lifted his nose in the air and maintained "It’s not surprising then that they get bitter, they cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustrations.”

During his re-election campaign, the President, defending his wife, patronizingly argued "there's no tougher job than being a mom," a perspective torn to shreds (in another context) a year ago by writer and mother Mary Elizabeth Williams.

The President not only looks down on mere mortals, the habit is spreading.  Presidential press secretary Josh Earnest, appearing on Morning Joe, actually stated

Well Joe, as somebody who gets paid to talk in public for a living, I try to be mindful of at least trying to be slow to criticize people who say things in public that are so inconsistent with their reputation and with their character. And Senator Brown is somebody that has a good relationship with the president. They've worked effectively on a range of issues including nominating and confirming the first woman to be the chair of the Federal Reserve. So, Senator Brown is a stand-up guy. And I'm confident after he's had a chance to take a look at the comments he made yesterday, that he'll find a way to apologize.

Gosh, Barack Obama's feelings were hurt and Sherrod Brown will apologize, Earnest speculated, "after he's had a chance to look at the comments he made yesterday" As a child, Brown just blurts things out, infers the President's spokesperson.

So keep at it, Senator.   It may be a dream, but perhaps a couple of other members of Congress will follow your lead and Barack Obama will realize your criticism is quite mild, that others have not escaped the realization of how demeaning he is.






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Now He Perks Up

Finally, President Obama has had enough- he's not going to take it anymore! This advocacy for the middle, and working, classes has to end. Therefore, in his typically low-key fashion, on Tuesday, President Obama claimed "I love Elizabeth. We're allies on a whole host of issues, but she's wrong on this... When you hear folks make a lot of suggestions about how bad this trade deal is, when you dig into the facts, they are wrong."

You'd hardly expect the cheerleader for the jobs-destroying Trans-Pacific Partnership to concede the Senator is "right on this."  Still, it was a little disconcerting when Barack on Thursday whined

The one that gets on my nerves the most is the notion that this is a ‘secret’ deal. Every single one of the critics who I hear saying, ‘this is a secret deal,’ or send out emails to their fundraising base saying they’re working to prevent this secret deal, can walk over today and read the text of the agreement. There’s nothing secret about it.

If "the truth shall set you free," Barack stands chained in a 4' x 8' cell.  Too polite to call him a liar, Charlie Pierce comments

In fact, there's been a lot that's secret about it ever since the negotiations began. It was negotiated behind closed doors, and for reasons that benefited nobody except large corporations and the politicians, dictators, and provincial satraps who do their bidding. (The fact we know much of anything at all is because the good folks at WikiLeaks threw some of the treaty out into the world, which is hardly a proof that the TPP isn't a "secret" deal. WikiLeaks doesn't do a lot of work with stuff that's in the public domain.) 

On Friday, Barack added to his earlier remarks

Every single one of the critics saying this is a secret deal, or send out e-mails to their fundraising base that they're working to stop a secret deal, could walk over and see the text of the agreement. When I just keep on hearing people repeating this notion that it's secret -- I gotta say, it's dishonest. And it's a little concerning when I see friends of mine resorting to those sort of tactics.

Of course, it's not secret- not to the people who really count to Barack. Jim Hightower explains

Top executives, lawyers, and lobbyists of 500-some major corporations who serve on 16 Industry Trade Advisory Committees do have access to the secret texts and to the negotiators themselves. They get to review and amend official proposals, submit their own drafts, and generally look after their own very special interests.

Practicing his stand-up routine, Barack maintained "The notion that corporate America is going to be able to use this provision to eliminate our financial regulations and our food safety regulations and our consumer regulations -- that's just bunk, It's not true."

That would not be so funny had the Senate Finance Committee (which ended up approving the fast track bill) not voted on two measures, approving one and defeating the other). They were aimed at deterring currency manipulation and the Administration so concerned about financial regulations opposed both. At the White House Correspondence Dinners, the President kills with his jokes. When ostensibly serious, he's even better.

Finally, flush with a deal which is a veritable wish list for multi-national corporations, Barack turns into a tough guy, discovering his inner Incredible Hulk (below). An exasperated Sherrod Brown of Ohio, according to the Huffington Post, called it "maddening" and

told reporters that the Obama administration was putting on a full-court press unlike anything Democrats have ever seen in his presidency in order to win the authority to fast track enormous trade deals.

"I think if you could get my colleagues to be honest, on the Democratic side, with you -- and I think you can mostly -- they will say they've been talked to, approached, lobbied and maybe cajoled by more cabinet members on this issue than any issue since Barack Obama's been president," Brown said...

"I wish they put the same effort into minimum wage. I wish they put the same effort into Medicare at 55. I wish they put the same effort into some consumer strengthening on Dodd-Frank," Brown said.

Evidently, Barack would have, were he interested in truly universal health care or regulating the financial sector. Alas, we finally have found out who the real Barack Obama is, and it's not pretty.









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Not By Accident


Thursday, Bloomberg News reported

Shortly before President Barack Obama was re-elected, he confided to John Podesta, an informal adviser, a vow he was making for his second term: He would never again bargain with Republicans to extend the U.S. debt limit. 

The precedent, set in the agreement that ended a 2011 budget standoff, “sent a signal that this was fair game to blackmail over whether the country would default,” Podesta, a onetime chief of staff to President Bill Clinton and co-chairman of Obama’s 2008 presidential transition, said in an interview. “He feels like he has to end it and end it forever.” 

The stand Obama has taken on the latest fight over the government shutdown and borrowing limit -- refusing to tie policy conditions to raising the debt ceiling -- is an attempt to repair some of the damage that he and his aides believe he sustained by making concessions to Republicans to avert a default two years ago, according to former top administration officials and advisers...

If Obama makes concessions again to House Republicans over raising the $16.7 trillion debt limit, “he’ll be viewed as a guy who you can hold up,” said Podesta, chairman of the Center for American Progress, a Washington research group with close ties to the administration.

Obama is surrounded by a core group of aides who are mostly veterans of the 2011 debt negotiations, which were followed by the first downgrade of U.S. government debt... 

At the same time, a political breakdown that leads to a debt default carries greater risk over the long run for Obama than for the Republicans. An economic crisis that might tip the country back into recession would tarnish his presidency and the durability of his initiatives such as expanding health care to millions of uninsured Americans and pushing through the most sweeping changes in financial-market rules in seven decades.

“There’s a hell of a lot more at stake for the president of the United States,” said Leon Panetta, Obama’s former defense secretary and Central Intelligence Agency director. “Nobody remembers who was speaker of the House when we went into the Depression; everybody remembers who the president was.”

He added: “Presidents who are successful are ultimately presidents who are able to get it done, get beyond this crisis. We cannot be a country that is constantly facing crisis.”

David Atkins of Digby's Hullabaloo and the Ventura County (CA) Democratic Committee applauds Obama for recognizing his mistake and resolving not to repeat it.  However, he then adds

But let's all stop pretending that the President was playing 11th dimensional chess in 2011. He wasn't. He wanted a grand bargain on the deficit (wrongly) and he thought the debt ceiling negotiations would be a good time to get it. That was an even bigger error that emboldened Republicans and put the nation at risk. Those of us who called it an error were right, his defenders were wrong, and the President is now admitting that and acting on it--much to his credit. 

President Obama may not have been playing 11th dimensional chess in 2011.  But he is now.

You might recall calls from the left in 2011 for the President to make sure the debt ceiling would be raised- without paying a ransom- by invoking the 14th Amendment, whose section 4 reads

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any state shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.

The President, however, chose instead severe budget cuts, which were to have been determined by a commission but, when it failed to come to agreement, were automatically imposed by sequester.   In the current hostage situation, Slate senior editor Emily Bazelon and historian Eric Posner argue

Obama does indeed have the power to declare, without Congress, that he’ll pay off the nation’s debt. Our view is that he can cite his inherent emergency powers under the Constitution once financial markets begin to freeze up. Others have noted that the 14th Amendment provides that the “the validity of the public debt … shall not be questioned,” and have argued that while it instructs Congress, not the president, to protect the debt, the president can act if Congress violates its duty.

The White House will keep insisting it doesn’t want to act on its own because doing so would be politically risky. The president would much rather Congress fold. There is always some residual risk from doing something that hasn’t been done before, so we understand the reluctance. But if there’s no deal by the end of next week and financial markets get wobbly, Obama should just go ahead. He is not shy about advancing executive power in other domains. Why not put the country and the world financial markets out of their misery? Wouldn't the polls reflect support and relief? And wouldn't the American political system be better off if presidents in future can remove this gun from their own heads?

The White House line is that if Obama raises the debt ceiling on his own, the markets would still be spooked. There would be doubt that he actually had the authority he asserted. The whole thing would get tied up in the courts. And if the markets aren’t reassured, then his action would be not only risky politically, but pointless. Some economists share that view. “There would be too much uncertainty,” Stanford’s Darrell Duffie told us. “It would lead to a halt or abatement in trading of treasury bills.”

It’s true that debt issued by the White House would be less clearly kosher than normal debt sanctioned by Congress, simply because it’s new and different, and so less proven. People who oppose the president’s action on constitutional grounds or who might gain from default (like owners of credit default swaps) would bring suit, whereas no one would sue if Congress lifts the debt ceiling.

But lawsuits that challenge the president’s authority to issue debt would almost certainly go nowhere. Most plaintiffs would not be able to show a personal injury from the issuing of new debt. Lacking legal standing, their cases would be dismissed. Those who got beyond this stage would be blocked by the political question doctrine: Courts would dismiss the suit on the grounds that the controversy over the debt is an inter-branch conflict between the president and Congress that is not for judges to resolve. So if some creditors sell off Treasuries or refuse to buy new debt, the smartest investors—the hedge funds and the sovereign wealth funds—would sweep in to make a killing.

Bazelon and Posner concede "If Obama jumps the gun and lifts the debt ceiling before the public has a sense of crisis, he risks being accused of imperialism (and of being impeached)."  However, although articles of impeachment might be filed, there is little chance they'd go anywhere against the first black President, given a likely coalition of a few Republicans with a solid bloc of Democrats. Further, impeachment in the House and conviction in the Senate (the latter even less likely) would result in a President Biden who, as an incumbent, would be the favorite to win the next presidential election.  (Were President Clinton removed from office, Al Gore's majority would have been sufficient to prevent even the Supreme Court installing his opponent as President.)

But there is no evidence Barack Obama is seriously considering invoking the 14h Amendment.   And that is because he currently is playing 11th dimensional chess in which the most likely outcome of the debt standoff is, as Noam Scheiber maintains, one in which Obama would

basically give Republicans a trumped-up, impressive-sounding version of what he’s already offered: You guys reopen the government and raise the debt limit, and then I will dispatch my vice president and my entire economic team to negotiate face-to-face with Paul Ryan over a long-term deficit deal every week for two months (or whatever), after which they will report back to me, and John Boehner and I will discuss what they’ve come up with. Obama would have essentially offered no concessions for the reopening of the government and the raising of the debt limit. He will have committed to no cuts and no deficit-reduction targets of any kind. But he will have given Boehner a fig leaf that he can show his rank and file to persuade them that this whole suicide mission wasn’t entirely futile.

Democrats then would pat themselves on the back because they would not have given up anything substantive in the short term, though they will have rendered the GOP's intransigence a success.  Last week, Obama stated- without hint of irony or disappointment- "when you hear government not compromising, we're compromising so much we're willing to open the government at funding levels that reflect Republican wishes, that don't at all reflect our wishes."  He clearly has signaled he is willing to accept that and more through negotiation, once the federal government is re-opened and the debt ceiling raised.

And Democrats are poised to fall in line. Once the therat of either a continued government shutdown or a debt default is removed,  Senator Sherrod Brown (D-OH) told ABC's Jake Tapper Friday, a larger budget deal (likely to include cuts to earned benefits and "tax reform") would be "something we should consider. We should consider everything now," That is no Blue Dog Democrat or neo-liberal but one of the Senate's stalwart progressives.  (Think Grover Norquist suggesting a willingness to accept higher taxes on corporations.)

President Obama will have gotten another shot at a Grand Bargain.  He would be far from the wisest man in the room, but the smartest, most clever guy of them all.



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Two Guys Make A Modest Suggestion


It is possible for liberal/progressive Democrats to work with Republicans.   And not only with the (ever-dwindling) ranks of "moderate" Republicans, but with conservative Republicans. And not on permanently lowering income tax rates, killing by drone strikes young males who are not terrorists, eavesdropping without warrants, preventive detention of American citizens, or cutting earned benefits.  Both the chairperson (from whose website the following is taken) and the ranking member of the Senate Banking Committee on Financial institutions and Consumer Protection have sent a letter

to U.S. Attorney General Eric Holder questioning whether the “too big to fail” status of certain Wall Street megabanks undermines the ability of the federal government to prosecute wrongdoing and impose appropriate penalties.  They also requested that the Justice Department disclose the identities of parties with whom prosecutors consult about the appropriate level of penalties for financial institutions.

“Wall Street megabanks aren’t just too big to fail, they’re increasingly too big to jail,” Brown said. “Already, the nation’s six largest megabanks enjoy what amounts to taxpayer-funded guarantee by virtue of their size, making it harder for regional and community banks to compete. Now, these megabanks may also enjoy some impunity when they violate the law by laundering money or illegally foreclosing on homeowners.  Wall Street should pay the full price of its wrongdoing, not pass the costs along to taxpayers.”

“The best deterrent to crime is to put people in prison,” Grassley said.  “That includes those at powerful banks and corporations.  Unfortunately, we’ve seen little willingness to charge these individuals criminally.  The public deserves an explanation of how the Justice Department arrives at these decisions.”

Matt Taibbi recently wrote that the bailout of the financial industry

built a banking system that discriminates against community banks, makes Too Big to Fail banks even Too Bigger to Failier, increases risk, discourages sound business lending and punishes savings by making it even easier and more profitable to chase high-yield investments than to compete for small depositors. The bailout has also made lying on behalf of our biggest and most corrupt banks the official policy of the United States government. And if any one of those banks fails, it will cause another financial crisis, meaning we're essentially wedded to that policy for the rest of eternity – or at least until the markets call our bluff, which could happen any minute now.

Andrea Mitchell of NBC News maintains that if Hillary Clinton decides to run for the 2016 Democratic presidential nomination, she will (as the NBC website put it) "clear the field" and "no one else will be able to challenge her, not Andrew Cuomo, Joe Biden, or Martin O’Malley."  But from 1964 through 2008, the vote in Ohio, represented in the U.S. Senate by one Republican (Rob Portman) and one Democrat,  for the winning presidential candidate has deviated from the national average by 1.3 percentage points- and in 2012, by .87% points.

Democratic politicos know Ohio is a swing state as well as a bellwether. If it  wants a nominee willing to challenge the powerful interests whose actions threatened to sink the world economy,  it should welcome a challenge to Hillary Clinton, and from someone bolder than Joe Biden or (especially) Andrew Cuomo.




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Predictable Change Of Heart

Ohio Senator Sherrod Brown and Senate Majority Leader Harry Reid are among the co-sponsors, all Democrats, of S1917, which includes a surcharge on millionaires with extension of the payroll tax cut and its extension to employers. Two days ago, The New York Times reported

Republicans — who have adamantly defended a renewal of the so-called Bush tax cuts, which also expire at the end of 2012 — have been lukewarm on extending the payroll tax holiday, arguing that it would not stimulate the economy. They are particularly displeased with the Senate proposal to pay for it: the bill calls for a 3.25 percent tax on gross income over $1 million for single filers and married couples filing jointly.

Liberals have been battering Republicans (see video of Rachel Maddow and Demos Distinguished Fellow Bob Herbert, below) because they have opposed continuation of the payroll tax cut, whether because of an animus to the middle class or a simple-minded opposition to anything supported by President Obama.

They should have taken the GOP's superficial opposition and considered themselves, and the American people, lucky.

Currently, at Obama's insistence, there is no loss to the Social Security trust fund because it receives a transfer equal to the hit it otherwise would have taken. I had planned for a few days to argue in this space that once there is a Repub-dominated government (de jure, rather than simply de facto, as at present), the cut would be temporarily extended or made permanent- but without reimbursement of the trust fund. Its reserves would decline as the Social Security trustees find that, without an increase in funding or a decrease in benefits, the Social Security trust fund no longer will be able to pay full benefits until 2037. Conservatives, having bled the trust fund, would declare that Social Security is in greater danger than ever and will not pay benefits unless it is seriously reformed- by privatization or some other scheme intended to eviscerate the system. Firedoglake's David Dayen explains

....if you don’t return the payroll tax to its full rate in 2012, it becomes harder to do so down the road (it’s always a “tax increase,” in the Obama parlance, when it goes away). Then the general fund is picking up some of the Social Security costs, and Social Security is contributing to the deficit in a roundabout way, making it easier to argue that it needs to be “fixed” (i.e., have the benefits cut) in some way.

"Why would they be against, Maddow asks Herbert, " something that would help the middle class?" Gee, might it have been a negotiating tactic? Alternatively, they have suddenly, inexplicably, changed their mind. As the smartest man in Washington (not to be confused with the man who believes he is the smartest person in the western world, Newt Gingrich)

Senate Republican Leader Mitch McConnell on Tuesday opened the door to extending the payroll tax holiday, just two days after his top deputy suggested Republicans would not support a renewal of the temporary cut.

"In all likelihood, we will agree to continue the current payroll tax relief for another year," McConnell said Tuesday.

And of course this agreement to consider what Republicans wanted all along comes with a price, all the higher after Democrats complained for weeks about GOP opposition. Dayen reports McConnell "vowed that Senate Republicans will come up with their own offset, and based on the offsets they have proposed in the past, expect it to be completely unacceptable, something on the order of drastically reducing near-term spending across the board. "

Note to Maddow et al.: the Pentagon budget will not be among that which Senate Republicans will demand be slashed. Digby argues

it appears the plan is to demand something odious in return to pay for it and then blame the Democrats for raising taxes when they refuse. (Sound familiar? It should, it worked beautifully last December. Look for them to hold up the Unemployment extension too, just for kicks. It's Christmas. They deserve a little fun.)

The idea that the GOP would demand something intolerable and then blame Democrats for raising taxes when they predictably refuse never had occurred to me. But then, it seems that the idea that top Republicans would end their opposition to this tax cut, portray themselves as tax-cutters, and take a major step toward their goal of ending Social Security as we know it never occurred to Maddow, Ed Schultz, and a whole passel of Democrats in Congress.

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Quote Of The Week



"It's the same way Bush and Cheney did the Iraq war. It's the same way Bush and Cheney did the Patriot Act."



-Freshman Senator Sherrod Brown (D.-Ohio) on MSNBC's "Road To The White House" on 9/23/09 regarding the Administration's heavy- handed approach to the crisis of, and brought on by, the financial services industry