Why ask them to swap when both Clinton and Biden are by all accounts doing a great job? Mainly because it would revitalize and unify the Democratic ticket, which will face a formidable opposition, contrary to popular wisdom. I don’t know whether the Republicans will nominate Perry or Romney, but I have a pretty good idea of who the short list for VP will be — and Sarah Palin and Michelle Bachman don’t need to wait by the phone.

The strongest VP candidates for Perry or Romney are David Petraeus and Mario Rubio. Petraeus is unlikely to do it. He is a Rockefeller Republican, who Romney could not appoint. He just began a job running the CIA, which takes him out of domestic politics. I hope. He is not Tea Party certified and while he clearly brings huge strengths to any ticket, is not an experienced campaigner (military campaigns don’t count, although the differences are fewer than many realize).

Rubio is a different matter entirely. He is young, son of Cuban exiles, the politically savvy former Speaker of the Florida House, telegenic, and a Senator from a battleground state. He is fully credentialed by the TP crowd. A Romney – Rubio ticket will begin with massive strength in the south and will be very tough to beat in Florida. Romney will play well in the Midwest, where his father was a popular governor, and to conservative parts of New England. Rubio would energize Hispanic voters and extend the Republican base beyond the rich, the pugnacious, and the certifiably looney. It would be a tough ticket to beat — and Obama knows it.

Hillary helps Obama to rally Democrats and Independents. She is a formidable, even relentless, campaigner and she works harder than anyone in politics. It is not simply that she has handled problems in North Korea, Iran, and Israel without upstaging Obama, or that she has been supportive of the president and has been serious, intelligent, and energetic. It’s not just that people in the State Department like her — and some like her a lot — or that she has kept her husband out of the limelight, despite the fears many had. It’s that, unlike Joe, Hillary has a devoted constituency. She draws women, independents, and blue collar voters in much larger numbers than Biden or Obama. She adds deeply to the ticket.

The case for Biden as Secretary of State is also clear: it is the job he has always wanted and he would be very good at it. He was the ranking member and often the chair of the Senate Foreign Relations Committee, he has the requisite rolodex, and he likes diplomacy. He will rely more on personal relationships with foreign leaders than Hillary has, but that’s fine. Biden has built a very solid relationship with Obama and would continue as a senior advisor — a role he enjoys and excels at.

The timing of the Great Swap is constrained by the Constitution. Section 2 of the 25th Amendment states that “Whenever there is a vacancy in the office of the Vice President, the President shall nominate a Vice President who shall take office upon confirmation by a majority vote of both Houses of Congress.” At the moment, that confirmation would be far from assured, so Obama is not likely to ask Biden to resign, appoint Hillary VP, then appoint Biden to State (where his Senate confirmation would be a cake walk). Instead, if he decides to do this, he would plan the move now and nominate Hillary at the convention. Once nominated, Hillary would resign her position and Obama would name Biden to fill it immediately. No House vote needed.

Will Obama make the Great Swap? A lot can go wrong with moves like this — but Obama knows better than anyone that a Presidential campaign requires imagination and energy. Much can and will change before the convention, but we can count on this: Obama is considering this move.  

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So what does the new stage look like? You can see a more interactive version here. You can see at a glance that the big ticket items are:

• 23% is health care for old people, poor people, and kids. This is the elephant in the room — the one that both parties know they must address and neither wants to go first. Obama doesn’t touch it.
• 22% is Defense, if you count veterans benefits, which are 3% of the budget. Republicans are especially prone to ignoring this one, although the Obama budget barely touches it.
• 20% is Social Security, which is actually fixable with some tweaks, mostly means testing. 
• 14% is Safety Net (“Income Security”). All of this is means tested and benefits our weakest citizens. Republicans view all of this as on the table. It should not be.
• 6% is interest on the debt. This is basically untouchable — trick is not to grow it.  
• The remaining 15% is smaller bits including Education and Transportation (both under 3%) and International Affairs, Technology investments, and Resource protection (each under 2%).  

At a glance, you can see that trying to balance the budget without touching Medicare, Social Security, Veterans Benefits, Interest, or Defense — as Republicans have proposed — takes about 2/3 of the budget off the table — very tough.

As Matt Miller and others have pointed out however, beneath the headlines lies political math:

• It’s more about taxes than spending.  Obama proposes to spend 22.7% of our economic output on government. Reagan’s idea of small government was 22% of GDP. The percent matters less than what you spend it on: investment that creates future wealth (freeways, education, research) compares poorly to spending to transfer current wealth (entitlements, safety net), which compares poorly with basic government functions (diplomacy, military, environmental stewardship, law enforcement, etc). Different modern countries devote different amounts of their economies to each. The US remains at the low end of the list of government spending as a share of GDP and at the very high end for military spending, but it is very hard to argue that we have a uniquely big governent. 
• Neither side cuts spending. What Obama calls “walking the walk” on fiscal discipline amounts to a 1% cut ($400 billion out of $450 trillion of federal spending over the next ten years). Indeed, Obama grows spending by 65% in just four years: from $2.2 trillion in 2011 to $3.6 trillion in 2016. The GOP is no better: the “fiscal conservative” Paul Ryan touts his ‘Roadmap’, which does not balance the budget for decades and adds $62 trillion in debt. The Washington Post shows that Obama plans to add 15,000 federal civilian employees.

• Goliath skips dessert. A prime example of phony spending cuts: Obama plans to cut 2% from the next $3.5 trilion in defense procurement. Republicans oppose even these cuts, even though the US spends much more on arms than the rest of the world combined — in part because we buy arms for much of the rest of the world.  
• Obama plans to borrow instead of tax. This is the guts of budget politics. Since nobody wants to cut spending or raise taxes, we borrow. Obama calls for $7.2 trillion of new borrowing, which would double our national debt in ten years without doubling the size of our economy. This is only defensible if the additional spending really is investment that creates new wealth. But it isn’t.
• Obama assumes strong economic growth to pay for his spending. This is a standard budget ruse that every President uses, which is why we would be better off using CBO growth rates for budgeting. Obama gets the federal deficit to 3% of GDP by forecasting spectacular growth. He assumes real growth (after inflation) of 3.6% in 2012, 4.4% in 2013, 4.3% in 2014 and 3.8% in 2015. Using average growth rates and no new taxes, we end up with chronic deficits in the 8% of GNP range for the many years — not smart and not sustainable.
• Interest expense will start to hurt. As a result, interest expense on the federal debt is scheduled to quadruple from $207 billion to $844 billion annually in ten years. Like any household or business with too much debt, this obviously further constrains productive public investment.

Obama’s case for running deficits is that fiscal stimulus is critical during this phase of recovery from recession. Two problems with this. First, the deficits are too small to spark a lot of employment growth, even if Congress would approve them, which they won’t, and when you factor in reductions of state spending, net federal stimulus is even smaller. Second, the idea of temporary spending increases has lost credibility because too many past increases have built constituencies that have made them permanent.  

Democracies are better at devising public programs than cutting them. This reflects gutless or innumerate politicians, less than it reflects a citizenry that wants it both ways. Polls say that we want cuts in spending without cuts in services. Everyone is willing to cut services that we don’t use and to raise taxes that we don’t pay.

The traditional solution to issues like this (think military base closures) is not a democratically accountable legislature but a commissions empowered to force up or down legislative votes, politicians not running for re-election (Jerry Brown in California), and less often, judges whose decisions withstand appeal. Obama of course, just received the results of such a commission and although it was hardly glorious, it was a mistake to walk away from their recommendations. 

What we have is Clinton redux, with the same players but higher stakes. Obama has set a cautious stage for the budget showdown:  irritating but not alienating Democrats while offering nothing for Republicans to embrace. He has set the stage not for compromise, but for a stalemate in which neither side takes the risk of new taxes or new cuts. in that respect, Obama may perfectly reflect the ambivalence of the American people, who want to cut taxes but not services. At the moment, our representative government is representing us a bit too well. 

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Obama this week announced an effort to hunt and destroy stupid federal programs. As he well knows, these programs are easy to find but tough to kill. I learned this when I was put in charge of a really stupid federal program. I got agreement at the highest levels of government to kill it. The program is still alive.

The year was 1993 and Bill Clinton had named Vice President Al Gore to chair a federal task force on Reinventing Government. This was, by some counts anyway, the eleventh such federal task force in the twentieth century. Gore created the Hammer Award to recognize government efficiency. He would send a $6 hammer, a striped ribbon and an aluminum-framed note to recipients. The award parodied the Pentagon’s infamous alleged $436 hammer.

Better if Gore had bought six hammer and a sack and given awards to programs that were dumber than a bag of hammers but Gore, like Clinton and Obama, has a core belief that government programs could be made efficient. Personally, I think there are plenty of government programs whose value exceeds their cost and a whole lot that don’t. The task of killing terminating inefficient programs is something that few democracies are good at – and when they are, it is usually because they resort to extra-legislative processes, like military base closure commissions or the Texas Sunset Commission.

At this time, I had started a new federal agency in the Labor Department and some of my colleagues had generously contributed to my new enterprise by transferring to me all manner of federal detritus. At senior levels of government, that’s how you get stuff off your shoe — you give it to the new guy. One of the programs transferred to my benevolent care was known simply as 13(c). The program had a total of thirteen employees — who turned out to be wonderful, dedicated people (the Federal Transportation Administration provides a detailed analysis of 13(c) here and the public comments on the DOL revisions to the law appear here).  

At first, I did not pay much attention to 13(c). It was a small team whose job was to approve the release of federal transit funds. But on January 17, 1994, I suddenly learned a great deal about this small program. 

On that day, a thrust fault ruptured in the San Fernando Valley of Los Angeles at 4:30 am. It produced the highest ground acceleration ever recorded by seismic instruments. Thirty people were killed immediately and another thirty died in the hours and days that followed. More than 9,000 people were injured. The Northridge quake destroyed parts of Interstate 5, California’s aorta as well as the Antelope Valley Freeway. Within a day or two, the new President and several of his cabinet secretaries, including my boss at Labor, were on their way to Southern California to provide tangible federal support for rescue and reconstruction.

But a day before the trip, the Deputy Secretary told me that the US government could not release emergency transit funds because Section 13(c) approvals were still pending. Those funds were now needed immediately because Los Angeles suddenly needed hundreds of busses and vans to create new transit arrangements. I needed to understand 13(c) in detail. To quote the DOL website

“This Federal statute requires that employee protections, commonly referred to as “protective arrangements” or “Section 13(c) arrangements” must be certified by the Department of Labor and in place, before Federal transit funds can be released to a mass transit provider.

Meaning that the United States Department of Labor must certify in writing that no employee will be inconvenienced by federal transit spending as a condition of the release of the funds. I immediately met with the woman who ran 13(c), an experienced and smart federal professional. 

“How much transit money are we holding for Southern California?”

“We don’t know”

“You need to find out”

“We have no way to find out”

“OK, bring me the files on every single federal transit program in Southern California. I am good at addition.”

“We can’t do that. The files are not organized that way.”

“Then go through every single file and pull all projects that take place in Southern California. Bring the files to me. I am releasing all the funds.”

“You can’t do that”

“Why not?”

“Because we have not certified that these projects meet the necessary protective arrangements”

“It’s true that you have not certified them. Which is why I am going to certify them. All of them. Stupid in normal times is expensive and inconvenient — but stupid in an emergency is dangerous. Bring me those files.”

“We cannot get started until morning”

“Absolutely not. This team stays in this building until those files are on my desk. All night is no problem — I’ll order pizza and come up and help”

I had the files by 10pm, I signed my name to a zillion forms and funds were released to Los Angeles. Better, certainly from my view anyway, 13(c) stayed out of the newspapers (something it is fairly good at). Not a single worker ever complained – indeed rebuilding LA created a lot of good jobs. 

By spring of 1994, Gore was in full search for needless federal programs to kill, so I quickly nominated 13(c). In no other part of government do we protect workers by witholding federal funds. Not for the military, for health care, for agriculture, or for any of the zillions other federal expenses. Why impede transit spending this way? This program was very small (we could easily redeploy the staff to more productive programs), it was unbelievably rigid (it added months or even years to federal transit funding), it had few supporters, and it had recently demonstrated its potential to endanger federal emergency response. What could be easier?

Gore knew about the program (the level of detail about tiny federal programs commanded by professional politicians always astonishes me). He wanted to make sure that Congress would support killing it. “You need to make sure Norm Mineta is on board“. Norm Mineta chaired the House Committee on Transportation and, by accident, was someone I had known for a long time, since I worked on his campaign when he was my Congressman from San Jose. Also, he and I took the red-eye from San Francisco to DC each week. Easy. 

Mineta: “13(c) is a relic. Love to kill it. Tell Secretary Reich and Gore that I’m fine letting it go. But you should probably check with OMB.” 

The Office of Management and Budget was run by Leon Panetta, a former Congressman that I remembered from when he was a Republican. Most Sunday nights, Panetta was on the same flight. He agreed that 13c was moronic (not his term) and was surprised that it was still around.  He had no problem killing 13(c).

We were ready to go. The executive and legislative branches of a powerful government would soon rid itself of this pimple on the body politic.

It never happened. The United States Department of Labor still enforces section 13(c) of the Federal Transit Law, even though the statute is now located at Section 5333(b) of Title 49 of the U.S. Code. It is a tiny, trivial program — but it delays hundreds of millions of transit dollars each year and adds millions of dollars of cost to these programs — and no value. 

Obama wants dumb federal programs to kill? Here is a tiny, stupid program without an advocate in the world outside of politically impotent transit unions. Transit professionals throughout the land despise 13(c) — I literally have found nobody who has ever seriously defended it (including, truth be told, many of the program’s own staff). But the political work to terminate even small, useless programs is enormous and the payoff is tiny. The political calculus has not changed in the five hundred years since Machiavelli advised his Prince on the danger of political reform: 

“…there is nothing more difficult to carry out nor more doubtful of success nor more dangerous to handle than to initiate a new order of things; for the reformer has enemies in all those who profit by the old order, and only lukewarm defenders in all those who would profit by the new order; this lukewarmness arising partly from the incredulity of mankind who does not truly believe in anything new until they actually have experience of it.

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• repeal Don’t Ask, Don’t Tell, which will go down in history as a civil rights landmark
• ratify a new START treaty, the first arms control treaty every ratified by a Democratic President
• give the FDA important new authority over food inspection. Not a small matter.
• get 19 federal judges confirmed, following long and pointless Republican holds
• review new net neutrality regs from his FCC — much more smoke than fire here
• enact the largest stimulus package in American history. Um, what?

Extending the Bush tax cuts and related tax measures will have a larger fiscal impact than the $800 million package that he and Bush negotiated in 2009. TARP money and congressional stimulus was not all spent and much of what was spent was either loaned to banks and repaid (we made a profit on the banks) or invested in car companies (not profitable but not a huge expense on net). The tax deal will pump a trillion borrowed dollars into the US economy over the next two years. I’d strongly prefer that we had the remotest clue of a repayment plan, but you have to think that a trillion dollar shot in our economic arm over the next two years will help Obama’s re-election prospects.

Another sign of a good week: everyone in Washington is unhappy. Obama should be delighted. Republicans find themselves reduced to two talking points. “Obama failed to make the Bush tax cuts permanent” and “he is blowing a hole in the deficit”. They only now seem to realize that these two arguments are mathematically contradictory.

The left is also livid. Paleolithic Paul Krugman and the usually savvy Simon and Kwok, have assert that Obama should have cut a better deal despite his electoral evisceration (due in part to the perfidy of cowardly Democrats in Congress who were unwilling to pass a new tax bill until after the election). As they did in advocating a public option during the health care debate, liberal Congressional Dems have demonstrated their ability to go from being right at the margin to being just plain marginal.

Writing in New York Magazine, John Heileman captured the situation nicely:

The liberal objections to the plan are mainly political, but on substance they are focused on the cost of extending the tax cuts to Americans making more than $250,000 a year and the estate tax: $125 billion combined. Even by the fiscally debased and debauched standards of Washington, that’s not chump change, especially at a time of dangerously mounting deficits.

But it’s small beer compared to the parts of the package that Democrats favor: $360 billion in income-tax cuts for those earning under $250K, $56 billion in unemployment insurance, and more than $350 billion in tax goodies that Obama championed — from payroll-tax cuts, the Child Tax Credit, the Earned Income Tax Credit, education tax credits, and business-investment tax incentives.

As David Leonhardt wrote in this morning’s Times, the deal amounts to a trade: Republicans get tax cuts for the rich, and the broader economy gets what amounts to a second stimulus worth hundreds of billions of dollars more — the kind of stimulus that Republicans resisted for the past year and that seemed inconceivable even two weeks ago. This is why left-leaning policy wonks such as Robert Greenstein of the Center on Budget and Policy Priorities and Larry Mishel of the Economic Policy Institute support the deal, despite objecting (rightly) to the high-bracket tax cuts. And it’s one reason that congressional Democrats should shut up and support it, too….

… For nearly two years, (Congressional Democrats) have complained that Obama has been focused on grand (too grand) attempts to reshape the foundations of the economy, as with health-care reform, while neglecting the short-term imperatives of a fragile economic recovery.

Well, it’s now clear that the administration is focused like a laser beam on the short term — on stimulus, on jobs, on the needs of the unemployed. And yet suddenly liberals in the House are fired up about deficit reduction? Please.

Obama is distancing himself from Congressional Democrats just as Clinton did successfully in 1994 – and for much the same reason. If he wants to portray himself as “Washington’s last adult standing”, he not only needs a lighter touch, as Heileman notes, but he needs a moral call to arms that touches the patriotism and sense of honor that animates the political center of American politics.

Two years ago, the Obama campaign reintroduced a moral vocabulary that Americans knew was missing. But on health care, economic recovery, national defense, and the current tax discussion, Obama has substituted a pragmatic legislative voice for a demand for shared sacrifice. This week he showed us that he can be a very good politician – and we should expect that. But we elected a guy who can be more than a very good politician – he has the ability to reshape the political dialogue.

Obama should use his state of the union address to call for shared, tangible, and painful sacrifices. Free of Congressional Democrats, he is well positioned to do this (it is tasteless to point out but nonetheless true that another terrorist attack, however despicable, would help Obama to achieve this just as the Oklahoma City bombings helped Clinton at the same moment).

Instead of waiting for al Qaeda however, Obama could and should remind us that as a nation, we face very real educational, economic, and environmental crises and we are trying to wind down two very long, expensive wars against potent enemies. Obama can and should lift American political discourse above “don’t touch my junk” with a message of rational fiscal sacrifice.

Examples:

• Freedom isn’t free – it’s a buck a gallon. There is no such thing as a free war. Our wars cost us a dollar a gallon – we need to pay it. Americans burn about 140 billion gallons of gas every year and we spend about 150 billion dollars to support more than 150,000 troops in Iraq and Afghanistan. Instead of borrowing that money, we are asking every American to pay for it at the pump or in an annual tax based on vehicle efficiency. What we are still not asking every American to do is fight – less than 1% of the population does that, as Secretary Gates recently pointed out.

• Education isn’t free — and ignorance is incredibly expensive.  Without stronger teachers earning higher salaries with no tenure protection, we will be a second rate nation by 2050. This is a national crisis and I need every American to contribute time and money to solve it. The Department of Education is certifying a series of private, nonprofit foundations devoted to selecting, compensating, and training talented teachers and tutors. I call on every American, especially those who earn a million dollars or more annually, to support these groups with tax-deductible donations. I call on every college graduate to work with these programs, adopt a school kid who needs your help, and make sure that he or she is learning more than you did. Our kids are now among the worst educated in the world – and we will pay a fearsome price as a country if we don’t fix that.

• Food isn’t free — its $.003/calorie. Americans now eat 3770 calories per day and almost 40% of these calories are from fat — the highest of any country in the world. It is making us sick. 8% of us are already diabetic and another 20% are prediabetic – a really expensive and unpleasant disease. Obesity now costs us $150 billion a year – same as those two wars. This works out to about three cents for every 100 calories we eat – or about $1.25 per person per day. So instead of subsidizing unhealthy calories – especially sugar and meat, we are going to pay for the cost of obesity by taxing calories and make ourselves healthier in the process. It turns out that if you raise the cost of high calorie food just a bit, we all eat healthier food. So we are implementing a national calorie tax of three cents on every 100 calories. It will cost average eaters about $400 per year, but we will give low and moderate income households $300 rebates. Those who eat more carefully can actually make money on this tax and save the government money on health care.

By being creative, pragmatic, and calling Americans to higher purpose, Obama can begin to repay the money he has borrowed to rebuild the economy and he can repay the trust Americans placed in him that he could be a great president, not just a good one.
 

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In rushing to defend and celebrate WikiLeaks, an unruly collection of progressives, libertarians, and hackers are guilty of basic and careless policy mistakes.

Some believe that WikiLeaks is a basic first amendment matter. It should not be. So far, with no exceptions that I am aware of, leakers get punished and publishers do not. Once secrets are out, hosting or mirroring a website, viewing or downloading materials, writing news stories, etc. are all protected. But leaking is not. Nobody would argue that freedom of speech permits the release of classified material but once released, it is equally hard to argue that the material is still classified. There is a good argument that the WikiLeaks controversy is more about Pfc Bradley Manning, the alleged source of the leaks, than Julian Assange. If Assange had nothing to do with the leaks (not clear), this is true. In any case, WikiLeaks has suddenly added the words 
“journalist” and “journalism” more than twenty times on its site and removed its offer to publish classified information. Smart move.  

Others compare Manning or Assange to Daniel Ellsberg without thinking through the implication of the comparison. Ellsberg leaked the Pentagon Papers – secret military evaluations of the Vietnam War that exposed the duplicity of the Johnson and Nixon administrations – as an act of civil disobedience. He knew that he was violating the Espionage Act of 1917 and was prepared to face the consequences: 115 years in prison. When arrested, Ellsberg said:

“I felt that as an American citizen, as a responsible citizen, I could no longer cooperate in concealing this information from the American public. I did this clearly at my own jeopardy and I am prepared to answer to all the consequences of this decision.”

Bradley Manning apparently thought he would not get caught but never mind — the Berkeley City Council wants to declare him a hero anyway.

They forget that Richard Nixon had even less respect for the rule of law than Ellsberg. He authorized the illegal wiretapping of Ellsberg and the illegal burglary of his shrink’s office. When this was discovered, the courts rightly tossed out the prosecution. With justification, most Americans today regard Ellsberg as a patriot.

They believe that the government’s chronic tendency to overclassify information justifies legally or morally, the release of classified documents. No human institution functions with complete transparency, least of all WikiLeaks. Relationships between people, families, companies, or governments are based on a mix of transparency and secrecy. You do not want your vote, your bank account, or everything you say, or write to be transparent. Governments do not want weapons designs, criminal investigations, diplomatic negotiations, security preparations, and much else to be made public.

They believe that the Internet inevitably promotes openness and accountability. This is wishful thinking, but incredibly common. If China is not a sufficient counterexample, WikiLeaks fans should look at, well, WikiLeaks — which fully understands the value of secrecy. They disclose nothing of their operations and as a result, we have no way to authenticate their documents or to evaluate the motive, access, and means of the document sources. Were the documents released by Israeli intelligence? By Tea Party nutters? By Chinese hackers? We are unlikely to ever know, because whatever else WikiLeaks is, it is surely not a wiki. The organization carefully and thoroughly encrypts all sources, employee names, funding, and internal communications. They understand that radical transparency is something you wish on your enemies.

WikiLeaks has appropriated upon itself the task of determining which government and corporate secrets should be released and which not. They have at least 15,000 documents that their sources have asked not be released, but WikiLeaks will not clarify why the source cares. WikiLeaks founder Julian Assange however, has made his personal motives clear: he wishes to harm the United States. In June, the New Yorker reported that Assange has envisioned a “social movement” to reveal secrets and “bring down many administrations that rely on concealing reality—including the U.S. administration.” What of the grave harm that these disclosures can cause to people, especially those who have supported the cause of freedom in Afghanistan? Assange dismisses this problem as mere “collateral damage” (a term he also uses for staff members he regularly fires). Will WikiLeaks expose Chinese military and diplomatic cables? Will Assange use his notions of “internet openness” to disclose North Korean or Russian secrets? Don’t hold your breath.

Ultimately, WikiLeaks may increase accountability while reducing transparency and free speech. Government employees who fear that candid comments will be exposed will simply write less and obfuscate more. They will share less of what they write, and display a great deal more political correctness, and hypocrisy. Decision-making will suffer, making government less effective, not more. Our diplomats will envy the Chinese and North Koreans, who will be able to speak much more freely.

The dysfunctional secrecy of the US Government of course, has made WikiLeaks possible and perhaps inevitable. Classifying almost everything as secret is simply an abuse of power. The practice feeds on itself and persuades those in the know that secrets can be kept: witness Obama’s breathtakingly stupid decision to order federal employees not to read WikiLeaks, apparently on the theory that they should be the last to know.

Benjamin Franklin famously claimed that three people can keep a secret, so long as two of them are dead. When the government authorizes three million people to see its “secrets”, one can legitimately ask whether these were secrets at all. Nor does it help that the feds recently decided to disregard their own secrecy rules when Dick Cheney and Scooter Libby outed CIA operative Valerie Plame because her husband challenged the Bush administration narrative on Saddam Hussein’s efforts to acquire nuclear materials. (This event turned out to be a double paradox because it now appears that Cheney was right about the Nigerian yellow cake, despite his laughable and corrupt Italian sources. Second, progressives who today praise Assange for leaking US secrets were outraged two years ago when Bush commuted Libby’s prison sentence for doing the same thing.

Should Obama prosecute Bradley? Of course. He appears to have violated his oath and the public trust. What about Assange? No. Unless he actively conspired with Manning. The leaks have been more embarrassing than damaging. Indeed, the US has come off as remarkably competent (for example, Obama’s efforts in Iran and the Middle East have been heroic). This was hardly the Pentagon Papers and if it was, WikiLeaks is the New York Times, not Daniel Ellsberg.

Obama’s choices are lousy in any case. In part, this is because the law governing the release of confidential government documents is arcane and in serious need of replacement. The quaintly named Espionage Act of 1917 was cobbled together to stifle domestic opposition to World War I. A modern version of the Sedition Act, it was used to imprison Eugene V. Debs for opposing the draft in World War I. (Undaunted, Debs ran for President from prison and got almost a million votes). The law makes it a felony for an unauthorized person to possess or transmit “information relating to the national defense which information the possessor has reason to believe could be used to the injury of the United States or to the advantage of any foreign nation.” It is excessively broad, unsuited to an Internet age, and in urgent need of replacement. (My dear Senator, Dianne Feinstein, believes that the US should prosecute Assange under this law. Her argument for doing this reveals more about a law designed to suppress dissent and her thin skin than it does about the damage caused by WikiLeaks).

Obama should use the WikiLeaks kerfuffle to pass updated legislation. We should require that confidentiality automatically expire after a certain time and require security agencies to declassify 90% of all currently classified material. Conceivably a civilian review board should have the authority to reclassify material because without a cost or a counterweight, there is no practical check on government secrecy. The law should also set a cap on the number of security clearances and make secret documents impossible to transmit or to copy electronically. This is technically straightforward, it imposes a convenience cost on secret documents, and securing them in a cloud behind military firewalls is a lot more secure than letting them live on millions of laptops.

WikiLeaks is just the latest reminder that secrecy enables public and private institutions to increase their power and decrease their accountability. Unchecked, governments become increasingly secretive and authoritarian. Government secrecy needs much stronger checks and balances, but WikiLeaks is not the solution.

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You had to laugh

Health care reform is a watershed. Not only did the federal government finally grant tens of millions of people access to basic health care. It heavily regulates private health insurance — something every other civilized country has done for decades. It is testimony to the tenacity of Obama, who was willing to get his hands very dirty, and to Nancy Pelosi, who did an amazing job making the sausage. I herewith retract my previous snarky comments about Madame Speaker. She seriously rocked on health care. There are few speakers in our history with the skill to make this bill happen. Also, we owe a debt of thanks to those in Congress who tool serious risks with their political careers for this bill (credit a brilliant and moving speech to them from Obama). 

Health care reform may set the high water mark for traditional liberalism. In the twentieth century, liberalism stood for expanding rights and benefits. The rights agenda granted new legal protections to women, racial minorities, workers, and consumers. The economic agenda provided a basic level of benefits to the poor, sick, and retired. Social Security, Medicare and Medicaid, Food Stamps, and Housing allowances represent the American federal safety net. Health care reform expands both citizen's rights (an end to lifetime exclusions and exclusions for preexisting conditions) and economic benefits (subsidies to enable low income Americans to buy health care).

Today's triumph likely spells an important step in a transformation from a liberal focus on rights and benefits to a focus on the fundamentals of progress and opportunity. This transformation is gradual, not sharp: gays, lesbians, and immigrants have a case for civil rights for example. But increasingly the job of protecting civil rights, labor rights, women's rights, and environmental rights is done by devoted civil servants and the courts. Likewise, once every American is guaranteed basic food, shelter, education, health care, and retirement income, the case for increasing state welfare provisions gets weaker. More fundamentally, the politics or rights and benefits is no longer the basis an enduring political coalition. 

This will be confusing to liberals who have focused for the past century on rights and welfare. Many lack the vocabulary to understand or advocate for the fundamentals of human progress and opportunity. As a result, new leaders will come to define successful Democrats. They will focus on five areas, none of which grant new rights or benefits.

• Education. We are producing students with the same capabilities as Costa Rica does. In today's economy, that means that in a generation we will either compete in the world economy like Costa Rica or, if we are very lucky, we will admit enough smart immigrants to continue to innovate. Democrats have quite literally sold the education agenda to the teacher's union — and the efforts of Obama and his Education Secretary Arnie Duncan to wrest it back are a profile in political courage that has been too little appreciated. They are doing more here, and faster, than any administration in US history. Their efforts deserve support.

• Entitlement. There is no evidence that an elected legislature can deal with this issue. Like military base closings, it needs a bipartisan commission with the power to draft non-amendable legislation. Naming one recently was a good step by Obama, since neither party has an ounce of credibility on this issue. Democrats are learning to say the word deficit like it matters and Republicans no longer claim that they wish to "starve the beast" by running up huge deficits as Reagan and both Bushes did. Bad things happen to governments that debase their currencies — and very bad things happen to governments that debase the world's reserve currency and lose the privileges that come with that. Our goal does not need to be the full repayment of all debt, but it does need to be the full funding of all state and federal obligations, a balanced budget in all but very bad years, and maintaining debt at sustainable levels, say 3-5% of GDP.

• Entrepreneurship. State and local governments can do a lot to help people start businesses and they can learn a lot from those who do. State and regional investment funds and startup incubators are working in several places, notably Maryland. Basic business literacy can help those wishing to start local small businesses to succeed. Democrats are deaf, mute, and dumb on this issue: notice once again that very few entrepreneurs serve in the senior ranks of the Obama administration. In California, the entrepreneurship agenda is being hijacked to mean tax cuts by two former technology CEOs who are running for office without ever having taken meaningful risk or started a company. Meg Whitman and Carly Fiorina did not create the businesses that made them wealthy — nor were either impressive as CEOs. Unfortunately, having toiled in the New Deal vineyards for so long, few Democrats have the basic vocabulary to improve the startup ecosystem or to adopt a startup perspective to government services — a huge weakness. 

• Environment. Neither party has a lock on wisdom or policy on this issue. Democrats need to find a voice that is economically and technologically more compelling  than Al Gore and Republicans need to prove themselves capable of advancing ideas opposed by large oil companies. In political terms, much of this comes down to a serious commitment to alternative energy. If you want to measure progress in this area, check the difference between Danish and US gas prices. At the moment it is about $8/gallon. When it approaches zero, we will be making progress. 

• Research. Federal research dollars drive tremendous advances in basic and applied scientific knowledge. The dollars need not be huge — on the order of $100 billion. Federal research grants are administered by The National Science Foundation, the National Institutes of Health, The Department of Defense, The Department of Energy, and The National Institute of Standards and Technology in the Commerce Department. Oddly, the federal research agenda has withered for lack of a champion (Nobel physicist and Energy Secretary Steve Chu may be taking the lead for the administration on this). We get huge bang for our buck here and this is not something that the private sector can or will invest in. 

In short, health care reform is a BFD not simply because it helps people who need help but because it will force Americans and especially Democrats to grow politically. Twentieth century liberalism was built on new rights and new benefits for citizens that had been denied the ability to participate fully in American life. Twenty first century liberalism is much more likely to focus on creating economic opportunities that make participation worthwhile.

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    a) A 1996 plan to cover every American 

    b) A 1992 plan to cover 30 out of 35 million uninsured Americans

    c) A 2006 plan to cover everyone in America's bluest state

    d) a 2010 plan to cover 30 out of 50 million uninsured

    e) a 2010 plan to cover 3 out of 50 million uninsured by 2019

OK, the last one is easy – it is the current offering by Republican leader John Boehner. But here is the surprise: Plan A was put forward by Bob Dole, Howard Baker, and Tom Daschle. B was from George H.W. Bush. C was Mitt Romney's successful plan in Massachusetts. Only plan D, hardly a revolution, is from a Democrat. It is Obama's current proposal. 

Why have Republicans backed away from the uninsured? It is not because the uninsured don't vote Republican — many clearly do. Or that there are too few to count: 50 million people is a seventh of the country. The actual reason is the elephant in the room today — the health insurance industry. They are easy enough to demonize, but to see why many insurance companies are now quietly demanding that the legislators they own squash health care reform, it is worth recalling exactly what insurance is and how it works.

Insurance turns tomorrow's risk into today's cost. This is exceptionally valuable, especially for risks that are low probability but high severity. Insurance companies add value by measuring, pricing, and selecting risk. 

America’s greatest polymath figured out the social value of insurance back in 1752. Benjamin Franklin founded the Philadelphia Contributionship for the Insurance of Houses from Loss by Fire. His company took on the financial risk of fire and invested in fire prevention. It selected risk by refusing to insure buildings where the risk of fire was too great, including any house that was made entirely of wood. Wooden houses became more expensive because the risk of fire was priced into the cost of ownership (assuming that insurance is mandatory, which it usually is if you have a mortgage). Because markets work best when all costs are reflected in the price, insurance created a powerful economic incentive to build and buy houses that were less likely to burn. Sweet.  

Insurance companies select and price risk. I once knew of a small auto insurance company with an interesting strategy: they only insured first and second generation Japanese Americans. They offered attractive prices and they underwrote a lot of risk. They correctly figured that Japanese immigrants were socialized to be careful, respectful, and polite – just the kind of driver they wanted. They kept their strategy secret – a copycat could easily have done them in. For many years, they made a fortune because they could select risk better than their competitors. Franklin did the same thing by refusing to underwrite wooden houses.  

Now consider health care. Can we price health care risk? Yep. With genetic profiling, we know more about which diseases you are likely to get than you probably want to know. You are a 57 year old sedentary white man who is overweight, carnivorous, non-diabetic, non-smoking, with a family history of coronary heart disease? We know what your health care is likely to cost. 

Can we select good risk? Sure – just insure people who are young and healthy. Avoid male hairdressers in San Francisco (an actual underwriting guideline during the 1980s AIDS epidemic). 

Today however, both Republicans and Democrats want to prohibit insurance companies from selecting risk. They want to ban genetic profiling and prohibit insurers from excluding preexisting conditions. Congress wants to require “community rating” – everyone in the same region who is the same age pays the same price (only smokers get charged more). Result? Healthy people won’t bother to buy insurance because the cost will exceed the expected benefit. 

As always, Democrats have an answer: compel everyone to buy insurance. But many people cannot afford health insurance. So Dems have another answer: tax people who are better off and subsidize health insurance for low income families. It turns out that anyone who wants community rating also has to want mandates and subsidies – it falls apart any other way.

OK, we want companies to sell health insurance but not to select or price medical risk. That’s like telling publishers not to select and price books. If you want everyone to have the same book at the same price, you don’t need publishers. The fact is, once we ban exclusions based on genetic testing or preexisting condition and insist on community rating, we eliminate the need for private health insurance companies. Congress is making private insurers unnecessary, yet continuing to insist that we can’t reform health care without them.

Can we really have an insurance system with community rating and universal access without private insurers? We have one: it’s known as Medicare. Medicare turns out to be the Great Exception. Private companies almost always do a much better job of managing costs and providing services than government does. But over the past decade, Medicare has delivered better care at lower cost than have private insurers. So to make health care available to everyone, regardless of risk, the most sensible solution would be to expand Medicare to everyone. 

But we are not going to do that. Tea baggers have put the fear of "government-run health care" into the heart of America. Insurance companies own huge chunks of Congress and will not die quietly. A single-payer solution is a bridge too far even for Barrack Obama. So the current plan is to try to neuter the insurance companies – to make them into public utilities. Holland, Germany, and Switzerland do this in different ways, and the results are fine. 

We might even find a way for heavily regulated insurance companies to add value. Perhaps they can document effective medical practices, a complex but critical task that many carriers are becoming good at. Or as companies that make bundles of risk into products: one plan may cover alternative medicine or chiropractic care, for example (Germany has regional plans that are 95% standardized but differ at the edges. It works in part because it has the backing of a serious federal program. Among other things, Germany noticed that a US innovation known as disease management produced strong and cost effective clinical results, so they introduced it comprehensively). 

Health care has become for Obama what the invasion of Iraq was to Bush: consumed by ideological fury and fact-free debate and stymied by an opposition more determined and successful than anticipated. Public support for federal reform efforts is now lower than it was when Clinton gave up in 1994. Whatever Obama manages to salvage, he can at least claim this: Americans now agree that we do not want private parties selecting and pricing medical risk. Unlike insurance companies, we have yet to confront the implication of this preference, namely that health care is now a market where insurance companies cannot add much value.

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Keep it simple 

Obama needs to resist calls to jam the Senate bill through the house. Both bills reflect the hubris that comes with single party rule. He should seek first to radically simplify his health care goals. Here are five reforms that even Republicans support.

1. Ban pre-existing conditions in setting coverage or pricing. Everyone understands this — and almost everyone likes it.

2. Pay for major medical. It is popular, important, and cheap. It is also simple: "any medical expense that exceeds 15% of your annual income is paid by the feds". I understand that, and I bet you do too. In a stroke, Obama addresses the scandal of medical bankruptcy. 16 years ago, even Bob Dole was in favor of this.

3. Set up free or low cost childhood immunizations and physical exams. Simple, easy to understand and the three remaining moderate Republican Senators can probably stomach it.

4. Allow for Medicare buy-in for those between 50 and 65. Simple idea: a public option for
people over 50, but they have to pay for it until they are 65.

5. Expand Medicaid to 200
percent of poverty level. A public option for the poor. We are paying for this care the expensive way now (ER visits), so expanding Medicaid makes sense. If he is feeling brave, Obama should nationalize Medicaid (take it away from the states). It's the right thing to do, and many of them would be glad to see it go.

These five steps is will not cover all uninsured citizens. They are a very long ways from liberal fantasies of single payer systems or massive delivery-system reforms. But this would be a highly respectable set of reforms for anyone to the right of Paul Krugman and would represent a lot more progress than anyone else has accomplished in sixty years of trying.

Pay for it It is important to limit the
tax-deductibiity of health insurance benefits for "Cadillac" plans and potentially also for people making more
than $200K a year. This not only generates revenue, but it is a lot better than the current plan to exempt collective bargaining agreements — a really ugly compromise. (BTW, who named high end health plans after a bankrupt gas guzzler?). The problem with high end plans is that they encourage price increases. Clinicians understandably want to set their rates based on what the most generous plans will pay. Subsidizing these plans means that we spend tax dollars to increase health care costs — a truly bad idea.

Improve the ecosystem

The paradox of the House and Senate bills is that in addition to goofy carve outs, special deals for certain states, delays purchased directly by lobbyists, and a breathtaking disregard for economics, the bills contain some intelligent and not terribly controversial provisions that could do a lot to improve the quality and reduce the cost of American health care. These should stay in the bill. They include:

1. Information standards. Medicine is an information-intensive business and the last large scale users of manila files. Nobody but the federal government can create a process for strengthening, evolving, and requiring medical information standards. This is a huge topic and a lot of work is underway, but it remains central to improving quality and reducing cost. 

2. Efforts to disseminate best clinical practices. This is where the cost actually comes out. Health care is like manufacturing — reduce variability and get it right the first time and it costs a lot less. This is true across a wide range of clinical conditions (indeed the trade-off between cost and quality is as illusory in health care as it is in manufacturing). Obama should embrace funding for best clinical practices research and local dissemination modeled on the US Agricultural Extension agents a la Atul Gawande's recommendations.

3. Investment in R&D, especially low tech innovation. Again Atul Gawande is a relevant thought leader. His research and demonstration projects in multiple countries shows that simple checklists can save literally millions of lives by requiring clinicians to follow the example of airline pilots by using checklists to avoid small, catastrophic mistakes.Checklist-style process innovation may be as important to improving health care as big science technology innovation. We need to fund both.

4. Transparent pricing for all medical services. Not in the bill but should be. Prices represent fundamental information that always drives a ton of change. But you need to have visible prices for services and today we do not.

5. Convenient outpatient care. Use the lever of Medicare to promote low-cost, walk-in, Wal-Mart style clinics (which are feasible only if standardized information systems are in place) and to expand
the role of nurses, paramedics, and pharmacists.

6. Public health pandemic preparation. H1N1 was a nice test run and we got lucky. Those local clinics can be really helpful in a public health emergency.

This is not universal health care. It isn't even really health insurance reform. Plenty of people will still be uninsured. But these measures would make an enormous difference to the cost, quality and availability of health care and they would end the scandal of medical bankruptcy and coverage denied for pre-existing conditions.

Given the massively distrustful
public mood, justified repugnance at the visible corruption of the
process to date, and a feckless Supreme Court determined to create an efficient
market for politicians, Obama needs to scale back his aspirations to
something Olympia Snowe can vote for and then move on.

Sue the Senate

Meanwhile, Obama should challenge the Senate's 60 vote "requirement" or prepare to see a Congress as neutered as the California
legislature. Since changing the filibuster rules in the seventies, the Senate has effectively abandoned majority rule on major issues. A Senator with 40 votes can stop the show — you don't even need to read from a cook book or the yellow pages any more.

Super-majorities are a terrible idea, as thoughtful
political observers left and right have observed since the days of James Madison. The Constitution
allows for them only for treaty ratification. It specifically requires the Vice President to
break tie votes in the Senate, which means it disallows super-majorities. This fact alone should be grounds for getting a Senate supermajority rule designated as unconstitutional by the Supreme Court. The
politics of this is distasteful, but paralysis in the legislature is paralysis in the executive. Obama should force the Senate to revise its rules by credibly threatening a Supreme Court challenge. Hard to see the Senate regaining its footing any other way. 

Update

Thanks to the Jamkid for pointing out that John Stewart has, once again, brilliantly articulated the back story.

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INTRODUCING BARACK OBAMA

On two occasions Obama had a chance to introduce himself to a national audience. He made the most of both opportunities.

The first came in 2004 when John Kerry asked him to give the keynote address to the Democratic National Convention in Boston. Obama was still an Illinois legislator but had won the nomination to run against the incumbent Republican for the US Senate. (For a sense of trajectory, recall that four years earlier, Obama was an obscure Illinois legislator who could not get credentials to attend the convention and that four years later he accepted his party’s nomination as president.)

It is fun to watch Jesse Jackson and Hillary Clinton applaud this speech. Jackson knows that he has been eclipsed as the voice of Chicago’s progressive black community and he is plainly none too thrilled. Hillary has no clue, except that she probably recalled Bill’s famous keynote to the convention, where the only applause line he got was “…In conclusion…”.

Already in this speech, you can see the hallmark elements of Obama’s worldview and his speeches

He has mastered the standard oratorical devices. Obama makes excellent use of standard oratorical devices, including straw men (“They said this day would never come”), slogans (“change we can believe in”), a sense of moment (“on this cold January night”), an attractive wife (“the rock of the Obama family”), call and response (“are you with me?), and a preacher’s cadence.

He has mastered his temper. Obama also runs cool — even when he is passionate, he is controlled and is absolutely never angry in public (seeing a red-faced southerner like Clinton lose it in public was unattractive, but for a black man to get angry would be fatal. We may have become more racially tolerant, but we are not racially indifferent and whites prefer black leaders who act nice).

He loves complexity and embraces contradiction including finding unity where little if any  exists. Thus “hope amidst hopelessness” and “not red states or blue states but the United States”.

He offers his own unlikely history as example and metaphor. “In no other nation is my story possible” appears here for the first time and regularly thereafter.

He takes a long view of US history and positions himself on the shoulders of well known giants and obscure toilers and soldiers. This lets him pay fitting tribute to those whose work and sacrifice made his career possible and helps him communicate a sense of historic inevitability about his rise to leadership.

He comfortably marries ideas with institution-building, believing as politicians must, that ideas don’t matter until they are given concrete form and resources by public institutions.This is less clear in his convention speech unless you take garden variety political endorsement as institution building, but is very clear in his Cairo speech and his Nobel acceptance.

He believes in the power of a just and forgiving God and is concerned about those who twist their Gods to justify religious or ethnic bigotry.

He is courageous. For presidents, popularity is power. You cannot get things done without being popular and, not surprisingly, you therefore tend to say what people want you to say. Most presidents would not advance a theory of “just war” to the Nobel Peace Prize committee, explain black resentment and anger when confronted with the comments of a thoughtless pastor, criticize jihadist Islam to students in Cairo, call on his party to support a military surge after 8 years of frustrating war. These are not the things most Presidents do often.

He is a cold war liberal. This is a very dirty word with most Democrats today, conjuring as it does visions of Scoop Jackson and Harry Truman. But Kennedy was a cold war liberal and so am I. It reflects a philosophy that many observers, starting I think
with David Brooks, have called Niebuhrian, after progressive US Protestant theologian Reinhold Niebuhr. Niebuhr, who argued for the importance of incremental steps forward in a flawed world, was best known for his Serenity Prayer, typically now recited as “God grant me the serenity to accept the things I cannot change, Courage to change the things I can change, And wisdom to know the difference.” Brooks cites an even better summary of Niebuhr’s worldview: “Man’s capacity for justice makes democracy possible; but man’s inclination to injustice makes democracy necessary.”

He insists on personal responsibility, even and especially by victims. This is of course, a conservative view usually overlooked by liberals — to our eternal detriment, as it turns out.

This is the speech that put Obama on the screen of many political junkies, myself included. For weeks following this talk, I could not shut up about the guy with the funny name. Many people recall now that my stuttering enthusiasm was the first time they heard of Barack Obama.

Obama’s next moment came four and a half years later, on January 3, 2008. That night was supposed to belong to Hillary Clinton as she began her inevitable march to the nomination with a routine victory in the Iowa caucuses. For a full accounting of that evening, see my report from the scene here. This was the evening that Obama reintroduced himself to America and the country. It was the night that I and many others began to envision this guy and his young family living in the finest public housing the nation has to offer.

Watch it here.

ON RACE — AND HANDLING BRUTAL POLITICAL CONTROVERSY

By March of 2008, Obama was under growing political suspicion not because of his words, but because of those uttered by his thoughtless pastor, one now forgotten Jeremiah Wright of Trinity Baptist — a huge black church in Hyde Park, Chicago.

On March 18, in Philadelphia, Pennsylvania, Obama gave what I regard as his finest speech ever — a mature, grown up discussion of the politics of race in America. At the time, I termed the speech brilliant but doubted that it would reframe the politics of Wright’s comments.

The speech is here, with text available here.

It still strikes me as an extraordinarily wise speech and a very brave one. Most politicians would have thrown their pastor beneath the proverbial train for making stupid and politically damaging comments at the height of a tough presidential campaign. Obama was able to speak honestly and insightfully about race and to describe Wright’s perspective and his disagreements with it. He spoke to the nation as grownups — smart, factual, and able to see a variety of viewpoints. He was understanding and hopeful, not angry and he clearly understood both the profound ignorance and deep resentments that lock many people in place. It was an example not simply of a great politician, but of a thinker unafraid of complexity. A remarkable speech and easily my favorite.

ON HIS AGENDA

Obama gets elected, gives a ho-hum inaugural speech, then faces the worst economic crisis in a very long time. Credit markets freeze, banks turn inward, the Fed pumps money as hard as it can and equity markets continue their free fall. It is January and the nation realizes that we just elected a guy to manage this crisis whose total experience in the US federal government consists of four years as a very junior US Senator — half of which he spent running for president. What he lacked in experience however, he made up for in audacity.

Congress and the American people were not a hostile audience, but they were a very, very apprehensive one. I published my full reaction to the speech here, but suffice to say that listening to Obama explain his priorities to Congress, I and many others were pleased to not be listening to John McCain.

ON ISLAM 

To this day, one American voter in eight believes that Obama is Muslim. Democrats are as likely to believe it as Republicans or Independents. He is, in fact, the only American president ever to live in a Muslim country — he spent part of his childhood in Indonesia. He is an acute observer of religion, so it was with real anticipation that he addressed students at the University of Cairo in Egypt. Egyptian students have a history of both scholarship and radicalism, having created via the Muslim Brotherhood the founding tenets of radical Islam.

As he had done earlier on race and would soon on war and peace, Obama spoke directly and said things that politicians usually don’t say. The title of my post on his talk, “We must say openly the things we hold in our hearts and that too often are said only behind closed doors” captures the core message of his speech, but little of its nuance. For me, this speech stands up well with the speech on race as an act of political courage. The speech is below. Transcript here. 

ON WAR AND PEACE

On December 1, Obama delivered the much-anticipated results of his lengthy deliberations on Afghanistan to an audience of cadets at West Point — probably the only group unlikely to protest his conclusions. He articulates clearly, as he did in Oslo a week later, his cold war liberal, Nieburian world view and committed a second surge of 30,000 troops to the graveyard of empires in Pashtun.

It is not an easy sell. He rightly praises multilateral institutions as necessary constraints on US power and on unpleasant dictators. But the multilateral institution that Obama praised most directly, the
United Nations, has determined that a
nation may forfeit its sovereignty and suffer military and economic sanctions if it commits any of four sins: genocide, state-sponsored terrorism, invasion of
another country, and deception concerning weapons of mass destruction.
Obama plainly approves, as he should.

But Iraq in 2003 was plainly guilty of all four crimes and Afghanistan in 2009 is just as plainly not guilty of any of them. Afghanistan
did not attack the United States on 9/11, it was 19 Saudis who trained
there who did. Even if Al Qaeda is the target, we could more easily
justify war against Saudi Arabia or Pakistan than Afghanistan. As Qaeda
proxies, the Taliban are an entirely legitimate target, but rather than
pledging to wipe them from the earth, Obama yields to the reality of of
a corrupt ally in Kabul and counterinsurgency doctrine that hopes to
convert the nice ones.

This week, Obama gave another speech that will be studied for years — and will surely rate as one his most important. Once again, the circumstances of the speech were not ideal and the audience one he would not have chosen but he once more turned the occasion into an opportunity to stamp his perspective on important world events.

Obama was awarded the Nobel Peace Prize in October — a prize that he surely had not sought and at some level did not welcome (although it is hard to imagine that receiving the Nobel Peace Prize creates a profound political liability). Still, the award presented the president with two challenges. Most obviously, he accepted it a week after announcing his second 30,000 troop surge in Afghanistan. This move that was opposed by most in his own party (who, like Obama himself, have yet to acknowledge that the surge in Iraq was perhaps the only truly courageous decision of George Bush’s presidency and one that, to date at least, has worked about as well as military decisions ever work).

Second, Obama plainly had not earned the prize.  I have argued elsewhere that the Nobel Peace Prize is the highest award we give on the planet but it has been tarnished by a string of undeserving Americans. Giving it to Al Gore or to Obama, while not as outrageous as giving it to Henry Kissinger, is not smart. At least Obama had the grace to protest repeatedly that he was undeserving.

Political wisdom (or neutrality, for that matter) is not the strong suit of the Nobel Committee. In presenting the award, the Committee Chairman noted that

“…President
Obama said he did not feel that he deserved to be in the company of so
many transformative figures that have been honoured by this prize, and
whose courageous pursuit of peace has inspired the world. But he added
that he also knew that the Nobel Prize had not just been used to honor
specific achievements, but also to give momentum to a set of causes.
The Prize could thus represent “a call to action”.

“President Obama has understood the Norwegian Nobel Committee perfectly.”

(To take but one obviously more deserving candidate, George Mitchell must feel a bit jinxed. The former Senate Majority Leader spent a decade negotiating and helping sustain the Good Friday agreement, which has so far managed to end the war in Northern Ireland, long acclaimed as the longest and most intractable civil war on the planet. Mitchell, raised in Maine by an Irish father and Lebanese mother, is now Obama’s chief envoy to the Middle East. In his spare time, he exposed steroid use in baseball and also serves as Chairman of Disney. Unlike his boss, this guy richly deserves a Peace Prize.)

But Obama more than rose to the occasion. He gave a thoughtful, muscular, Trumanesque speech that was as strong a defense of international liberalism as I have ever heard — and I know the speeches of FDR, Kennedy, and Johnson very well. Remarkably, the talk was praised by liberals and conservatives alike (excepting a few fevered and frothing cable pundits who were off their meds, including John Bolton). Obama expounded a doctrine of just war straight out of Niebuhr and expounded usefully on the role of multilateral institutions in promoting peace.  and had some smart observations about both the human condition and the need for multinational sanctions that were more painful than most of those now on offer.

Together with the speech at West Point, these speeches have been massively under reported, buried by news of health care, Copenhagen, and the holidays. This is unfortunate, because they not only offer a valuable glimpse into the thinking of the world’s most important leader, but they provide wonderful teachings to his fellow  citizens of both America and the world. Concludes Brooks,

“His speeches at West Point and Oslo this year are pitch-perfect
explications of the liberal internationalist approach. Other Democrats
talk tough in a secular way, but Obama’s speeches were thoroughly
theological. He talked about the “core struggle of human nature”
between love and evil.

More than usual, he talked about the high
ideals of the human rights activists and America’s history as a vehicle
for democracy, prosperity and human rights. He talked about America’s
“strategic interest in binding ourselves to certain rules of conduct.”
Most of all, he talked about the paradox at the core of cold war
liberalism, of the need to balance “two seemingly irreconcilable
truths” — that war is both folly and necessary.

He talked about
the need to balance the moral obligation to champion freedom while not
getting swept up in self-destructive fervor.

Obama has not always gotten this balance right. He misjudged the
emotional moment when Iranians were marching in Tehran. But his
doctrine is becoming clear. The Oslo speech was the most profound of his presidency, and maybe his life.”

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If this is a sell-out, count me a buyer. Last night's Senate deal killed Harry Reid's the public option, which deserved to die. It was bad economics and bad politics.

The Congressional Budget Office confirmed that the public option would have covered fewer than 2% of Americans – and would have been more expensive, since subscribers would have been sicker. That Pelosi and Reid let the liberal wing of the Democratic Party become obsessed with the public option was dumb, since the votes were never there to pass it in the Senate. Shame on them both — they took their eyes off of the prize and nearly upset the most important domestic reform in forty years.

Fortunately, Harry Reid ask people who are more sensible than he is to go off and work it out. As a result, Americans went to bed last night with universal health care coverage seemingly within reach. We should get ready to party in our freezing streets — we are on the verge of an absolutely stunning political achievement. 

Not only that, but the compromise stuck by five liberal and five moderate Democratic senators last night was in most respects an improvement. The main goal of health care reform has always been to give every citizen access to health coverage. Bonus points for separating it from employment (truly a silly way to give people health care coverage). Last night's compromise goes a long ways towards removing health care from employment (something most employers, especially small ones, don't mind at all). And we could do more. For example, the house bill does not enable people with employer-based coverage to use the public exchanges. Employers and liberals should embrace an amendment offered by Ron Wyden to use the money that their company spends on private benefits to buy coverage from the public exchange if they prefer.

This is the reform that Bill and Hillary could not achieve: near-universal health care coverage, a ban on the use of pre-existing conditions to deny coverage, and a national major medical policy to limit out-of-pocket costs as a percent of income to end health care bankruptcy. On top of this, people can buy into Medicare at age 55.

Liberals should ice the bubbly and get ready to pop the corks — (my friend and former boss, an expert in this field, is surely right when he cautions me to "wait until the morbidly obese lady sings"). Despite the inevitable imperfections of any democratic legislation, this is huge progress that would have been unthinkable in the darkest hours of the Bush era. When we sober up, we should recognize that we kicked the can down the street on cost control — but with so few elected liberals able to grasp the fundamental importance of this problem, this goal has been out of reach from the start.

Oddly, it may be easier to control costs than it has been to win the fight for universal coverage. The cost measures that matter benefit hugely from information technology, best practices clinical technology, and management technology. They may also benefit from improved structure of health care markets, but it is far from clear that Congress can deliver that.

What Congress can do is mandate universal coverage, ban insurance company exclusions, and guarantee that no family will go bankrupt over health care costs. That we have not given ourselves this protection has always made America a savage in the eyes of much of the civilized world. (Note: the following piece reports on Atul Gawande's suggestion that the government can also use the Agricultural Extension Service as a template for testing and learning how to control costs). 

This week, Congress took a decisive step towards fixing the problem. It will very likely be the biggest progressive victory in my lifetime. The glum faces in Berkeley are testimony not to bad times, but of the ignorance and blinkered perspective of too many Bay Area activists.

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