They are on a roll. The good news just keeps coming.

Republicans have moved ahead of Democrats by 48% to 44% among registered voters in the latest update on Gallup’s generic congressional ballot for the 2010 House elections, after trailing by six points in July and two points last month… Over the course of the year, independents’ preference for the Republican candidate in their districts has grown, from a 1-point advantage in July to the current 22-point gap.

Barack Obama and the Democrats want you to know they had a good week. Last Tuesday Republicans threw away a New York congressional seat they had held for a century, preferring to fight each other than win an easy contest. Excellent, say Democrats. Civil war in the Republican party augurs well for next year’s mid-term elections.

What’s that, you say? Oh, yes, Democrats did lose the governorships of New Jersey and Virginia, with huge swings to the other side, but this was to be expected with the economy in such bad shape. Read nothing into that, say Democratic strategists.

Still joyous over this electoral affirmation, Democrats in the House of Representatives then made history over the weekend, with passage of their health-reform bill. The margin was narrow, admittedly, in a chamber they dominate. So what? A win is a win (except in New Jersey or Virginia). Everything is going to plan.

The remainder of this article can be read here. Please post comments below.

A lot of the post-election commentary has been entertaining, if not very enlightening. To any disinterested observer,  the Republicans had a good day on the whole last Tuesday. Not an unalloyed success, bearing in mind the self-inflicted wound in New York, but looking at New Jersey and Virginia, a pretty good day. So the question was how this good result for the Republicans was going to be turned into a bad result, or a result of no significance either way.

Eric Alterman explains “why Democrats are smiling“. Sort of explains.

While the Democratic brand is obviously not what it was when so many of us were brought to tears a year ago by that beautiful scene in Grant Park, Republicans are on the verge of civil war. The sure-to be-a loser side appears to have all the soldiers and the reasonable-sounding side, and the one that can win, appears to have well, not much going on. The Republicans’ suicide will be anything but painless if this keeps up—and it will, if only to continue to juice Fox’s ratings.

Well, as you can see, the piece is not a model of clarity. I’ve read that second sentence four or five times and I’m still not sure what it means. (Didn’t the reasonable-sounding side that can win, in fact, just do so? Can you win and still have “not much going on”? What else apart from winning do you really need to have going on?) But over the course of the article it does emerge that Alterman sincerely believes the Democrats have cause to celebrate Tuesday’s results. Well done!

Gail Collins in the NYT also deserves special mention, I think. She is not alone in believing that the elections were meaningless, but she gets extra credit for regarding their meaninglessness as so self-evident that she does not have to establish the point. She can just celebrate it, by lampooning the view that elections convey any information whatever. Love that title: “Hark! The Voters Speak!” What delicious irony. How we laughed. As though any such thing could happen in an election.

Even Charlie Cook, doyen of poll-gazers and a reliably informative commentator, comes off a little blase in this piece for National Journal. He says Tuesday did not tell us anything we didn’t already know. (Maybe he meant anything he didn’t already know.) We already knew that independents were turning in droves against the Democratic party. We already knew that Jon Corzine was so unpopular he would lose even to a divided opposition. We already knew that a staunchly conservative Republican could win a purple state by a big margin if he “projects a moderate, mainstream, nonthreatening, tolerant image”. Did we really know all those things? If I were a Republican, I’d still be pleased to have them confirmed, and if I were a Democrat I definitely wouldn’t be smiling.

More than a year after the US financial emergency went critical and threatened the global economy with its worst reverse since the 1930s, the underlying causes have yet to be addressed. When it comes to improving financial regulation, the crux of the matter, there has been a lot of talk – usually about the wrong things – and next to no action.

Last week, a committee of the House of Representatives, which has been co-operating with the Obama administration on this front, released a draft bill. It has some good ideas, such as creating an early resolution regime for non-bank financial institutions. It has some crazy ideas, such as aiming to keep secret a list of institutions subject to special oversight. Above all, it has plenty of material to get Congress riled up – especially the proposals to enlarge the supervisory role of the Federal Reserve.

Nothing matters to Capitol Hill so much as apportioning responsibilities and the power that goes with them. But who makes the rules is less important than what the rules say. Here the bill mostly opts out, granting discretion to regulators left and right. On issues of substance as opposed to form, it is vague to the point of silence.

The remainder of this article can be read here. Please post comments below.

In a new column for National Journal I ask what needs to happen before this problem is taken seriously.

The public debt stands at nearly $8 trillion and within 10 years, according to Congressional Budget Office projections, it will be more than $14 trillion. Getting to that second figure in one piece depends on two things. Some optimistic economic assumptions need to hold, and investors need to be willing to lend the government another $6 trillion. Taking either of these things for granted would be foolish.

Almost everybody in Washington agrees that the fiscal outlook is scary. Almost everybody says that something must be done. But the options for confronting the problem come down to spending cuts or tax increases, and as soon as you mention either, an embarrassed silence descends.

The politicians are not as worried as they say they are. And the same is true of the public. If you believe the polls, voters are more anxious about public borrowing than their politicians are — but not so worried as to welcome a rise in taxes (their own taxes, I mean) or cuts in Social Security or Medicare. They may be nervous about policies that would add to the fiscal problem — hence their hesitation over health care reform — but meaningful subtractions from the problem are a different matter.

Can anything be done? We have been here before. Washington has a time-honored procedure for such cases. Rather than thinking about entitlement reform or tax reform, it thinks about process reform.

And I go on to argue that process reform–despite the risk that it will degenerate into mere displacement activity–is not to be despised. In the past it has been a qualified success. Better that than having to deal with an otherwise unavoidable train wreck. You can read the whole column here.

The idea of a public option in healthcare reform is not dead yet. A lot of Democrats believe you need it to hold down costs. A lot also see it as a first stride towards Medicare-for-all, which is where they want the system to end up. Obama has signalled he is ready to drop the idea, but has given no strong steer one way or the other. The party, especially in the House, is not willing to give up on it just yet.

One of the things keeping the notion afloat is the belief that voters, too, are pretty keen. I’ve blogged before about this (here and here), noting that the polling results are actually all over the place. The answer depends on the way the question is framed. The variation also suggests confusion–which is warranted, given the complexity of these proposals, with or without the option.

The excellent Jay Cost at Real Clear Politics has taken a much more careful look at the question. Framing is everything, he finds, and questions which draw attention to possible consequences of the option elicit less support.

Cost draws attention to some Rasmussen polling. When asked,

“Would you favor or oppose the creation of a government-sponsored non-profit health insurance option that people could choose instead of a private health insurance plan?”

the answer is strong approval. Then comes a follow-up question.

“Suppose that the creation of a government-sponsored non-profit health insurance option encouraged companies to drop private health insurance coverage for their workers. Workers would then be covered by the government option. Would you favor or oppose the creation of a government-sponsored non-profit health insurance option if it encouraged companies to drop private health insurance coverage for their workers?”

A clear majority is now opposed.

So, does this mean that the public is actually against the public option? I’d say no. Instead, I would suggest that the public lacks sufficient information about that specific item to deliver a firm opinion. Accordingly, its opinion varies depending upon question wording, priming effects, the ebbs and flows of the news cycle, and so on.

Sounds right to me.

Further to the previous post, this column by Ross Douthat is on the same page regarding the financial consequences of health reform. He advocates a more limited form of universal access–to coverage with a very high, income-related deductible, or so-called catastrophic insurance. As he says, this has been proposed by Martin Feldstein and Brad DeLong, conservative and liberal respectively, so the idea has cross-party appeal.

There’s certainly a lot to be said for this approach. Feldstein and DeLong differ in important ways (DeLong wants to shut down private health insurance altogether) but they agree that the taxpayer should pay for healthcare expenses above a high threshold, and that the tax deduction for employer-provided insurance (which costs more than $200 billion a year) should be abolished to pay for it. Either of their plans would strengthen the individual incentives to economise up to the threshold. I only wonder if a deductible as high as they envisage (15% of gross income; DeLong favors an income-tax increase of 5 percentage points on top of that) could be made to stick.

Charles Krauthammer and Bill Schneider offer contrasting takes. Krauthammer as always makes some powerful points. His catalogue of Obama’s failures to date is correct, isn’t it? In particular, Russia’s lack of response to the administration’s multi-track overtures has received too little attention.

And what’s come from Obama’s single most dramatic foreign policy stroke — the sudden abrogation of missile defense arrangements with Poland and the Czech Republic that Russia had virulently opposed? For the East Europeans it was a crushing blow, a gratuitous restoration of Russian influence over a region that thought it had regained independence under American protection.

But maybe not gratuitous. Surely we got something in return for selling out our friends. Some brilliant secret trade-off to get strong Russian support for stopping Iran from going nuclear before it’s too late? Just wait and see, said administration officials, who then gleefully played up an oblique statement by President Dmitry Medvedev a week later as vindication of the missile defense betrayal.

The Russian statement was so equivocal that such a claim seemed a ridiculous stretch at the time. Well, Clinton went to Moscow this week to nail down the deal. What did she get?

“Russia Not Budging On Iran Sanctions: Clinton Unable to Sway Counterpart.” Such was The Washington Post headline’s succinct summary of the debacle.

You can make a better case than Krauthammer allows for changing the missile-shield policy, but the fact that Russia hasn’t budged on Iran is indeed a notable failure.

Krauthammer goes much further, of course, and says that calling Obama’s Nobel merely “premature” is absurd. He thinks we can already write off the administration’s whole approach. There he loses me. Such certainty, less than a year in, seems as daft as saying it’s all going great.

Continue reading "More on the Nobel"