Senate stimulus bill ready for final vote tomorrow

The Senate version of the stimulus bill cleared its main hurdle a few minutes ago with 61 senators voting for the compromise deal amendment. This means that the Senate can hold the final vote on its bill tomorrow. Then the House and Senate bills move on to a conference committee where the real horsetrading begins. Once the conference committee issues its final "report" for the bill, the House and Senate each hold one final vote to approve the final conference bill that will be sent to President Obama for his signature.

It is unclear at this time what House items might be added back or what Senate items might be removed. That will be a matter for the House and Senate leaders to negotiate, not to mention the three Republican senators whose votes are needed to pass the final bill in the Senate.

The bill remains a cross between an over-decorated Christmas tree and an over-stuffed sausage, but that is about how it started out in the House anyway. The final trimming and stuffing will not occur until Wednesday and Thurdsday when the House and Senate bills are reconciled by the conference committee.

-- Jack Krupansky

John Taylor: How Government Created the Financial Crisis

Monetary policy expert John Taylor has an excellent opinion piece in The Wall Street Journal entitled "How Government Created the Financial Crisis- Research shows the failure to rescue Lehman did not trigger the fall panic" that succinctly argues that it was a string of monetary policy errors and misguided interventions on the part of the Federal Reserve and Treasury that created and prolonged the financial crisis. Technically, he is absolutely correct, but unfortunately monetary policy has more than a little domestic politics guiding it that precludes a strict and correct monetary policy. Could we have done better? Yes, but we could have done a lot worse as well.

-- Jack Krupansky

Is bipartisan politics DOA in Obama's "new" Washington?

Barack Obama was chosen by Americans to be their next president based on an apparently sincere desire to bring "change" to Washington. He claimed that he was going to eliminate the "same old games." He claimed that he would reach across the aisle in a truly bipartisan spirit. He claimed to be devoutly anti-lobbyist. I do believe that he is sincere in these commitments, but some of them will simply take time and never should have been considered as "Day One" slam-dunks.

The case in front of us is the fiscal stimulus bill currently soldiering down the partisan political gauntlet known as Congress. As traditional Washington legislation goes, this bill is actually doing quite well, but as a centerpiece of the "new politics" bipartisan spirit that Candidate Obama seemed to be espousing, it is essentially DOA (dead on arrival.) Its one success is that it does not have any true "earmarks", but it is chock full of pet hobbyhorses of innumerous subgroups of congressional factions of every stripe and flavor.

One other semi-success is that the original "plan" from the White House economic team did have one bipartisan twist, namely a significant dose of tax cuts and breaks that were clearly designed to appeal to Republicans. That was a wise choice, but President Obama is essentially credited with no points for that wisdom since liberal Democrats hate it and Republicans were denied the right to a "pride of authorship" participation in the drafting of the plan.

The net result is that just about everybody hates the bill for some reason or another. Maybe that is why it will pass: each faction knows that no other faction got what it really wanted. There is an old saying that the only truly successful and lasting settlement is one in which each party to the negotiation gives up something very dear to them.

That is essentially the proposition before us: Do we "blame" President Obama for this ugly duckling of a bill, or do we praise him for setting idealism and ideology aside and being so pragmatic as our Community-Organizer-in-Chief?

Us centrists and pragmatists will praise him, but the idealists (progressives) and ideologues (conservative Republicans) will vilify him.

Essentially this comes down to an all-out battle (war?) between those who believe that compromise (bipartisanship) is a force of good and those for whom it represents pure evil.

This is not the end of bipartisanship, but it will be a long war as the right wing conservatives seek to protect their dwindling legacy and the left wing progressives seek to recover that which they believe was stolen from them and otherwise denigrated in past years (vengeance?).

-- Jack Krupansky

Compromise amendment for stimulus bill still not quite ready, but coming soon

Senate Majority Leader Harry Reid just explained that staff has been drafting the 800-page compromise amendment non-stop since the 5 PM deal yesterday and it is expected to be ready to be formally submitted within a few minutes. There would be a procedural vote late Monday afternoon and then the big Senate vote on the entire bill could occur on Tuesday.

-- Jack Krupansky

What concessions will Barack Obama make to the Republicans to get a timely stimulus bill passed by a wide margin?

Although there has been talk of the big stimulus bill being delayed until the middle of February, I think this is simply the "same old games of Washington" mentality trying to take root again, and premised on the Democrats proposing an unacceptable bill that passes the House and then fails in the Senate and then gets renegotiated to be what it should have been in the first place. But, in meetings on Monday, Barack apparently indicated that he wanted a bill sooner than what people were talking about. There was also talk that he is determined to get 80 votes in the Senate. That makes a lot of sense to me, but suggests that major concessions will be needed. The ultimate question is what concessions Barack Obama will be willing to make to the Republicans in the Senate in order to assure that the bill gets passed, gets passed with a fairly wide margin of moderate Republicans, does not get blocked by angry right-wing Republicans, and gets passed ASAP, within a few days of the innauguration.

The precise list of concessions is not as important as the question of process. Barack is a strong enough community organizer to be able to deeply comprehend the extent to which he will need to make moderate Republicans relatively comfortable with any stimulus plan, as well as to assure that no right-wing Republicans feel offended enough to block the bill with parliamentary maneuvers. I am 100% confident that Barack knows this "game" well and will play it well, despite opposition to compromise that will come from his Progressive supporters.

I look forward to Barack signing a solid stimulus bill before the first of February.

-- Jack Krupansky

Does Pelosi get the message about working with the Republicans?

In his weekly address, Barack Obama talks in vague terms that "the problems we face today are not Democratic problems or Republican problems... These are America's problems, and we must come together as Americans to meet them with the urgency this moment demands." and that "we need an American Recovery and Reinvestment Plan." I am sure that Barack fully understands that he needs more than a couple of Republicans onboard if he wants a plan that is as grandiose as he envisions and as quickly as he correctly deems it necessary, but I have seen no evidence that Pelosi and her fellow Democratic hench-persons in both houses of Congress are in fact ready if not enthusiastic about accommodating the alternative views of a moderate number of moderate Republicans. From news reports, it does sound as if Barack's stimulus (or "recovery and reinvestment") team has been instructed to incorporate items from an earlier House stimulus bill, but that is surely a recipe for arriving at a standoff with most Republicans in the Senate. I suspect that Barack knows that this will be the result in the very near term (this week) and that he has "calculated" that he needs to allow that result to show that he is nominally on the side of the Progressive wing of the Democratic party. Once that standoff is reached, Barack can then turn to Pelosi, et al and wait for them to finally admit that they will have to make some concessions in order to get their bill passed. Barack will not have to say anything. The Democrats already know that concessions are needed, but they need to play to The Progressives and pretend that the Democrats "control" Congress. This is the way "The Game" is played in Washington. Sure, Barack said he wanted to stop playing "the same old games of Washington", but he wants fast, substantial results, so that's what is required.

So, the question is what Progressive elements of the current, unseen American Recovery and Reinvestment Plan will need to be ditched and what minimal collection of Republican stimulus policies need to be added to get at least a dozen moderate Republicans to vote for the bill and to not have it be so toxic to the remaining right-wing Republicans that they engage in parliamentary stalling tactics.

Barack said:

I look forward to meeting next week in Washington with leaders from both parties to discuss this plan.  I am optimistic that if we come together to seek solutions that advance not the interests of any party, or the agenda of any one group, but the aspirations of all Americans...

The first part about "discuss this plan" suggests that his initial proposal is somehow already cut into stone and he will be like Moses presenting the Ten Commandments, but then he goes on to say "seek solutions that advance not the interests of any party, or the agenda of any one group", suggesting that significant changes would be permitted, even bi-partisan changes that are not strictly supported by only the Democrats. These are conflicting messages, but I suspect that is intentional on his part.

What Barack is really saying is that his initial proposal incorporates most if not all of the Progressive economic agenda, which should convince The Progressives that he is nominally on their side, but that he fully recognizes that compromise with moderate Republicans will be required and essential and in fact a good thing.

To be fair, Pelosi may in fact agree with this approach 100%, but for political reasons cannot and must not challenge The Progressives and admit that compromise will be even considered.

So, this necessary Democratic pandering to The Progressives means that an economic stimulus plan needs to be rolled out in this multi-step fashion, with step one being intentionally crippled to pander to The Progressives, step two being moderate Republicans shaking their heads "No", step three being Barack meeting with all of the "injured" parties, step four being Pelosi acknowledging that the Senate does not have the votes, step five being modifications to make the plan bi-partisan, and finally passable by the Senate.

-- Jack Krupansky

Is Iran an Arab country?

Despite what many people may think, Iran is not an Arab country. Iran may share a religion and political and economic interests with Arab countries, but the people of Iran are primarily Persians and speak Farsi and other Persian languages, not Arabic. Iran is not a member of the Arab League and not considered an Arab state by the United Nations Development Programme.

Accoring to the Wikipedia, the Arab League has 22 member states:

1. Algeria
2. Bahrain
3. Comoros
4. Djibouti
5. Egypt
6. Iraq
7. Jordan
8. Kuwait
9. Lebanon
10. Libya
11. Mauritania
12. Morocco
13. Oman
14. Palestine
15. Qatar
16. Saudi Arabia
17. Somalia
18. Sudan
19. Syria
20. Tunisia
21. United Arab Emirates
22. Yemen

The UNDP says that "The Arab States region is home to some 320 million people living in 22 countries that stretch from Morocco and Algeria in the west to Yemen and Oman in the east."

Iran is not in either definition of an Arab state/country.

-- Jack Krupansky