King & Soneji, New York Times
CONGRESS and President Obama have pushed through a relatively modest stopgap measure to avoid the "fiscal cliff," but over the coming years, the United States will confront another huge cliff: Social Security.In the first presidential debate, Mr. Obama described Social Security as "structurally sound," and Mitt Romney said that "neither the president nor I are proposing any changes" to the program. It was a rare issue on which both men agreed "” and both were utterly wrong. 

David Shribman, Pittsburgh PG
Barack Obama's determination to enact a gun control measure in the wake of the Connecticut shootings could transform his place in history.Success, which is anything but assured, given the lobbies arrayed against him and the many failures of such measures, could upend more than two centuries of American tradition. It also could boost the president into the pantheon of liberal presidents, placing him beside Franklin D. Roosevelt and Lyndon B. Johnson as the principal progressives in modern American history.This may seem discordant with the prevailing view of Obama as a reluctant warrior, a...

This week we narrowly avoided the fiscal cliff. But while the president might have won that battle, the most important war -- the war against joblessness -- continues to drag on while pushed to the sidelines of our national conversation. Friday brought yet another middling jobs report, with the economy adding only 155,000 jobs. Yet when the president was asked on Meet the Press what his priorities were for his second term, after leading with immigration, he talked about "stabilizing the economy" mostly in terms of deficit reduction and "fiscal stability," and then "the huge opportunity around energy." So what happened to the "pivot" to jobs that we heard so much about during the campaign? Apparently that did fall off the cliff. At the current rate, unemployment won't be back to where it was before the recession for at least another seven years. It's a sign of how far off the rails we've gone that this is now seen as good news.

Annie Lowery, NY Times
WASHINGTON — With 2013 bringing tax increases on the incomes of a small sliver of the richest Americans, the country’s top earners now face a heavier tax burden than at any time since Jimmy Carter was president.House Speaker John A. Boehner and President Obama worked together to avert a fiscal crisis at the start of the year.

Peter Beinart, Daily Beast
The last few days remind me of the Clinton impeachment fight. In the late 1990s, a radicalized Republican Congress"”convinced that only it could prevent America from going the way of an ancient Rome"”faced off against a popular, recently reelected Democratic president. Back then, the GOP's crusade was against baby boom immorality, not just government spending (though it was against that too). Back then, as today, the GOP's insistence on ideological purity led it afoul of public opinion. And back then, as now, Republican leaders found themselves...

Two previous recent postings explored the parameters and the prerequisites for a progressive second presidential term for Barack Obama. Each of those postings triggered three broad responses from a largely skeptical audience. One broad response, from conservative or libertarian bloggers, was that since progressive answers to America's contemporary ills could only make those ills worse, the hope must be that Obama sets his face against them. A second broad response, from more radical bloggers, was that the underlying premise of the postings' argument was entirely false: Obama is no progressive, and never will be, so the fears of the American Right can and will quickly be laid to rest. The third - with which I have much more sympathy - was that progressive or not, Obama as president has no choice but to govern in co-operation with a House of Representatives whose majority is actively anti-progressive - indeed is as reactionary a House majority as any we have known in modern times. Compromise will therefore inevitably be the order of the day, with progressive disappointment the unavoidable consequence; and to think otherwise is simply to pipe-dream.

So in light of such responses, is it even worth exploring the possibility that the next four years could see the beginnings of a genuinely progressive New Deal for America?

Unrepentantly, I think the answer is still that it is - because futures are not only to be anticipated, they are also actively to be fought for and created. Ultimately time alone, of course, will tell us whether cautious progressive faith in the Obama Administration was or was not worth giving. But certain things are already becoming clear, things that point to where that activity (and that faith) now needs urgently to be directed.

The first is this: a genuine note of caution. From any Western European center-left perspective at least, what is happening here in the United States (or what might happen during this second term) will be at most both parochial and modest. Any European center-left party worth its salt knows it has two fundamental things to do. It has to move its whole economy away from any kind of Anglo-Saxon capitalism towards a more trust based welfare-capitalist one - towards one, that is, in which the power of business is to some degree balanced by the power of organized labor. And it has to use its years in office to strengthen that latter power: by bedding in rights to collectively bargain, by building strong welfare nets, by insisting upon socially responsible business practices, and by using public policy to guarantee a minimum degree of social equality. European center-left parties don't always do that to the degree their supporters require, of course, but this President is not even going to try. Barack Obama is not about to turn himself into a European social democrat of a genuine kind, or America into some form of advanced welfare capitalism. I wish he was, but he is not! Newt Gingrich is quite wrong on that. So too is Charles Krauthammer. The United States will not be reset in the next four years in some Scandinavian or even Canadian fashion. Progressive change here in the United States will inevitably be much more modest than conservatives fear. The thing that progressives now have to work so hard to ensure is that those more modest and limited changes do indeed set the whole economy and society off in some center-left direction.

A second and related observation is this. The rights of workers to join trade unions and negotiate their terms and conditions of employment are so limited here in the United States, and the rights of working women in particular (to paid maternity leave, flexible working hours and adequate child care) are so few in number, that catching up in just small ways on these key rights could itself help to set in motion a longer and much-needed process of progressive economic and social change. We need to remember that there are more than political personalities at play in the Washington policy fight. Whole economic growth models hang in the balance too. The bankruptcy of the Reagan growth model based on business deregulation and growing income inequality was demonstrated beyond doubt by the financial crisis of 2008. That growth model is dead, no matter how hard and how often Republicans try to revive and resell it. In consequence, what we desperately need here in the United States is a new growth model, one in which the over-reaching power of Mighty Finance is systematically and substantially curbed: curbed by the strengthening of American-based manufacturing on the one side, and curbed by the empowerment of American labor on the other. That need is so overwhelming that this second Obama administration might yet inch us towards a better growth strategy simply by default: motivated to make the correct moves less by any progressive instincts which the Administration may or may not possess, and more by the growing realization in governing circles that such a re-balancing is America's best hope of sustained growth and prosperity again. The task of progressives now must surely be to do everything possible to guarantee that such a shift in the direction of public policy actually occurs, and is then sustained.

Thirdly, there are just a few signs out there that things might be slightly more progressive this time round. The Administration is clearly determined to introduce comprehensive immigration reform and to tighten gun laws; and the President has recently spoken strongly in favor of trade union rights to organize and to collectively bargain. We don't know yet whether these much-needed initiatives are harbingers of a new direction in policy, or merely ad hoc genuflections to passing popular pressure; and certainly the small detail of the fiscal cliff settlement gives genuine cause for concern. As the Biden-McConnell settlement made very clear, this Administration is still capable of folding a winning hand; and may yet do so again. But there is a new toughness in the President's opening negotiating stances these days that is both welcome and long overdue; and he is certainly on record as being unwilling to cave to Republican demands in the upcoming debt ceiling fight. Yet that fight is waiting in the wings - it is just two months away - and unless Barack Obama is prepared to break new constitutional ground by simply raising the debt ceiling by executive order, some new compromise will necessarily follow. In March, the Republicans will inevitably go after Social Security, Medicare and Medicaid - urging deep cuts in each - and those cuts will come unless, before then, the President has persuaded a clear majority of the American people that a better way out of this impasse lies through progressive change: through such things as a new stimulus package paid for by deep cuts in military expenditure, the closing of corporate tax loopholes, and the belated creation of a strong public option to pull down excessive medical insurance costs.

That progressive counter-case is not what we are yet hearing in any detail from this White House as it prepares for its second term. Perhaps, privately, key Administration figures realize that the great strategic goal now before them must be the winning back of the House in 2014 - the defeating of a gerrymandered Republican House majority by re-mobilizing the ground game that so trounced Mitt Romney. But if they realize it privately, that realization has yet to surface publicly. To date the President still remains far too publicly wedded to the view that revenue increases need to be immediately matched by entitlement reductions. He remains too defensive on the importance of public spending for long-term economic growth; and he remains too committed to the limited federal regulation of large-scale American business. Occasionally - as in Osawatomie last year - the President speaks of the need for a new and more progressive social contract in America, but so far he has yet to fill in the full details of what that new contract should be. Indeed throughout his re-election campaign, Barack Obama remained too focused on the issue of shared sacrifice by Americans as taxpayers and wage earners, too silent on the parallel need for a greater sharing of rights, income and power between Americans in the workplace.

The President regularly talks a populist rhetoric, but he has yet to deliver an effective progressive politics. It is now the job of every American liberal to urge him to bring rhetoric and policy together, and to critique him when he does not. This country desperately needs a progressive tidal wave in November 2014, and you don't get tidal waves without first creating the headwind that drives them. It is time for that driving to begin. There is an Inaugural Address, a State of the Union, and a budget, all coming now in quick succession. Each will need to be watched for signs of fundamental re-framing. The President re-framed the gun law issue superbly by the quality of his address at Newtown. If he can do that vital job on something so horrific and so specific, let us hope he can do it too on something more structural and more general. America needs a new path. This President has the opportunity to set it. The question is: will he? I do hope so.

These arguments are developed more fully in David Coates, Pursuing the Progressive Case? Observing Obama in Real Time.

First posted with full academic citations at www.davidcoates.net

So, did we all have fun over the holidays?

The fiscal cliff fight went right up to the last minute, then we all momentarily Thelma-and-Louised over the cliff, and then Congress actually voted on a federal holiday. This last bit was so stunning, Congress is now going to take a two-week vacation just to recover (you know, from actually having to do their jobs). We missed commenting on most of this because we were busy doing our two-part year-end awards show (while also taking time to note that your constitutional right to flip the bird to a police officer has just been reaffirmed).

If we had a "best quote" awards category, we'd certainly have to nominate what outgoing House Republican Steven La Tourette had to say about the whole situation, after the Senate had voted 89-8 to approve the fiscal cliff avoidance deal: "We should not take a package put together by a bunch of sleep-deprived octogenarians on New Year's Eve." Now that's funny!

Humor aside, though the deal went through and immediately a contest erupted between left and right to see who could denounce the deal in highest dudgeon possible. We are not going to join in this flagellatory orgy, however, and are going to use our Friday Talking Points this week to point out why this deal is not just a pretty darn good one, but actually downright historic.

For those who may not agree with the previous statement, here's something we can all agree upon, in the spirit of entering the new year cheerfully -- Congress is now 100 percent Lieberman-free! Woo hoo! Not so sorry to see you go, Joe. Now please get off my teevee screen on Sunday mornings, okay?

 

While Democrats in general were showing a surprising amount of backbone in the entire fiscal cliff negotiation process, including folks like Harry Reid and Barack Obama, the one man being given credit for actually cutting the deal is the one who deserves this week's award.

Vice President Joe Biden is our Most Impressive Democrat Of The Week this week, for hashing things out with Senate Minority Leader Mitch McConnell. Speaker of the House John Boehner pretty much threw up his hands and took himself out of the deal-making process when his own House Republicans wouldn't back him up, and Senate Majority Leader Harry Reid was likewise sidelined when McConnell got frustrated with him and called up Biden instead.

Biden, you'll recall, used to be in the Senate. He knows how the chamber operates, and he knows how to bargain. He also knows the value of an actual deal, as opposed to the value of partisan posturing for the base or the media. So he broke the logjam and cut a deal with McConnell that sailed through the Senate (a vote of 89-8 is pretty rare on substantive issues, these days), and was then rammed through John Boehner's House -- forcing him to break the "Hastert Rule" (which is a pretty silly "rule" to begin with).

Was the deal perfect? Well, no. Could it have been better? Yes. Could it have been more progressive? Oh, certainly. Nonetheless, it passed. What you and I might consider the "perfect" bill likely would not have made it through Congress.

Which is the whole point. Joe Biden got what he could, gave where he had to, and still produced a deal which passed into law. There's even now a petition to "authorize the production of a recurring television show featuring Joe Biden" up on the White House website (which you can vote for yourself, if this sort of thing would interest you).

For achieving an agreement with the congressional Republicans which avoided the fiscal cliff (if you don't count the few hours we walked off the cliff in true Wile E. Coyote fashion, looked around, looked down in shock, and then ran back to solid ground before falling), for sealing a deal when all other Democrats had failed, and for the possibility we'll be seeing him in a reality show soon (heh), Vice President Joe Biden is our Most Impressive Democrat Of The Week.

[Congratulate Vice President Joe Biden on his White House contact page, to let him know you appreciate his efforts.]

 

The news today that House Minority Leader Nancy Pelosi just inserted a few House members into a group photo who didn't actually show up on time for the photo shoot is a little disturbing, we have to admit, but doesn't even rise to the level of a (Dis-)Honorable Mention, sorry.

The fiscal cliff deal itself was disappointing in a number of ways, not least of which was the failure to extend the payroll tax holiday for another year (or, at the very least, step it back up only one percent more a year). This is going to be shocking news to many Americans as they listened to Democratic politicians and the media tell them that the deal "would not raise taxes on middle class Americans" -- even though it will do precisely that. Whether or not there's a backlash from this realization will take a few weeks to play out. And that's just one of the disappointments in the whole deal.

But our real Most Disappointing Democrat Of The Week this week is none other than President Barack Obama. While Obama is riding a huge wave of positivity in the job-approval polls at the moment, and while he's got a pretty favorable schedule to look forward to this month (what with his second inauguration and the upcoming State Of The Union address), we still have to single him out this week for some very quiet caving on national security issues.

Lost in the fiscal cliff media frenzy was something else Congress put on Obama's desk recently: the reauthorization of the Pentagon's budget, known as the National Defense Authorization Act (or "NDAA"). As usual, Congress included several things in this year's NDAA that Obama does not support, such as restrictions on closing the prison at Guantanamo Bay. Also included was the authorization to indefinitely detain American citizens, which is truly extra-constitutional tyranny of the first order. Obama had issued a veto threat to Congress on the NDAA, but he went ahead and signed it anyway. Obama also approved the massive continuation of warrantless wiretapping, another civil liberties fiasco.

Now, we realize that the Pentagon needs a budget and all of that, so we understand Obama was in a pinch with the bill Congress sent him. We are also (as are many, it's worth pointing out) feeling rather jaded on the entire subject of Obama seemingly channelling his inner George W. Bush on national security and civil liberties issues. It's not that we've given up on the issue, but we do see it as being firmly in the "beating a deceased equine" category, at this point. Obama doesn't seem willing to muster the political backbone to fight on any of these issues, and hasn't since his first days in office, so we're not expecting him to change any time soon.

But beyond this defeatism, we are awarding Obama the MDDOTW award this week not so much for signing a bill with bad things in it, but for issuing a toothless veto threat in the first place. The veto threat is arguably the president's strongest legislative weapon. It is only rarely used, and only rarely even threatened. But the rule of thumb should be that any time a president threatens a veto, he should be absolutely willing to follow through on that threat -- or else he loses respect and leverage with Congress for the future. Every time a president threatens a veto and then does not follow through, he is seen as weaker by his congressional opponents. It's just a fact of political life in Washington.

Which is why President Obama is our Most Disappointing Democrat Of The Week this week. Don't make threats you aren't going to follow through on, Mister President. You just weaken yourself by doing so. If you're going to cave in the end, then refrain from making the veto threat in the first place -- it's that simple.

[Contact President Barack Obama on the White House contact page, to let him know what you think of his actions.]

 

Volume 239 (1/4/13)

All week long, the punditocracy has been fulminating over the fiscal cliff deal. From the left and from the right, there has been much garment-rending and gnashing of teeth. But you know what? This isn't such a bad deal, when you put it into proper perspective.

Our talking points this week are all in support of the deal, so be warned. Politically, it is hard to see how this is anything but damaging for Republicans, since their factional civil war in the House broke out into the open for all to gawk at. In the end, the Tea Partiers and Norquistians very publicly lost the battle. Perhaps this will reduce their influence in future debates, who knows? Even if it doesn't, the left should be basking in the schadenfreude right about now, while casting their eyes over the wreckage of what used to be the lockstep-Republican House, and their now-weakened leader John Boehner.

Sure, the left didn't get everything it wanted. But it could have been one whale of a lot worse. Consider all the things that didn't make it into this deal, in other words. Oh, sure, things like slashing Social Security and Medicare will be fought over again inside of the next two months, but none of it happened in this deal. That's a political victory, right there. Obama -- before the deal was even finalized -- appeared in one of the most cheerful official announcements he's ever gotten, and tossed down the gauntlet for the next round of negotiations. Obama will be looking for more tax revenue in the next deal, and he (so he says) will not be held hostage by the debt ceiling battle. He may, in fact, have a trillion-dollar platinum coin or two up his sleeve in that fight.

But let's look at what happened, as we'll have plenty of time later to pick apart the next deal, when it comes down the pike. Here are some suggestions for Democrats to use in explaining why the fiscal cliff deal wasn't just a pretty good one, it was downright historic.

 

   The first time in a generation

This is the main thing which truly puts the deal just cut into proper perspective.

"You know, you can pick nits all you want about the deal, but let's look at the larger picture instead. This deal is the first time in a generation that Congress has raised marginal tax rates. The last time Congress did so was in 1993 -- 20 years ago. The last time a tax hike passed with any Republican support at all was even further back -- a full 23 years ago. There are House members who have served ten full terms in office who have never seen this happen before, to put it in perspective. Did Democrats get everything they wanted? No, they did not. But they did manage to break the power of Grover Norquist and get an astounding number of Republicans on board with raising income tax rates on the wealthy. This was, in fact, a monumental achievement. Just look at the last two decades to see why."

 

   Washington ends a Big Lie in the budget

I have to admit, I called this one wrong. To me, this was the most stunning part of the deal, although the media didn't really stress it at all (due to most in the media being absolutely incapable of performing basic math).

"I am encouraged that Congress showed some real honesty in this deal, by permanently fixing the Alternative Minimum Tax. For years, Congress has played 'make-believe' with the AMT numbers, even though every single one of them knew that it was nothing more than a Big Lie in the budget projections. Each and every year, Congress pretended that they were only going to 'fix' the AMT for a single year, and that for the nine years after, it would remain unfixed. But everyone knew that was nonsense, because the AMT was 'fixed' every single year, like clockwork. Nobody wanted to see the real numbers. But when you hear the scoring on the fiscal cliff deal that was just signed into law, please remember that almost $2 trillion of the costs of this bill are nothing more than finally admitting that that $2 trillion was nothing more than smoke and mirrors in the first place; money that was never actually going to appear in the federal government's coffers. I applaud Congress for finally biting this bullet and getting back to some honest accounting rather than including make-believe and fairy dust in the 10-year budget projections. It took political courage, and it deserves a lot more attention than the media has been giving it."

 

   Thirty-nine-point-six percent

This is an important aspect of the deal that has been overlooked by the legion of critical voices out there.

"Yes, I would have preferred Obama had realized his campaign promise to raise tax rates on those making above $250,000 a year, but you never get everything you want in any particular bill. What Obama did hold firm on was another figure that had been rumored to be on the negotiating table. A few weeks before the deal was cut, the conventional wisdom in Washington was that the Republicans were going to get Obama to lower the highest tax rate from 39.6 percent to only 37 percent. I know it's tough for pundits to remember back that far, but this was indeed what everyone was saying inside the Beltway a few short weeks ago. The final deal that was cut did not lower this rate -- Obama got the full 39.6 percent for the upper tax bracket. So while he had to move on the $250K limit, he didn't budge on the tax rate itself -- something not many people have given him credit for."

 

   Cutting loopholes for the wealthy

This is where Obama could indeed gain further concessions in the next round of budgetary deal-making, but again, it's been given short shrift so far by the talking heads.

"Another thing few have noticed is that Obama did indeed raise taxes on those making a quarter of a million dollars per year. Deductions and exemptions and other loopholes will be limited for taxpayers above this threshold. This is something I expect Obama to revisit in the next round of budget negotiations, now that the tax rates themselves have been raised. Cutting loopholes for wealthy taxpayers should be very much on the table next time around -- but any agreement should preserve tax benefits for the middle class below the $250,000 line, as the fiscal cliff deal does."

 

   A step towards solving the Buffett problem

Lefties are complaining about the deal's treatment of capital gains and dividends, but once again, this should be seen as a step forward toward an ultimate goal.

"The fiscal cliff deal moves the tax system one step towards fairly treating all income the same, and solving the problem of Warren Buffett paying a lower tax rate than his secretary. Capital gains and dividends for upper-income taxpayers will now be taxed at a base rate of 20 percent rather than 15 percent. That's a rate hike of one-third, but it doesn't go nearly far enough. Remember, the Paul Ryan budget wanted to move this tax rate to zero, folks. So while Buffett may now pay only slightly more than half the rate than he would if it was regular income, this is still a big step in the right direction."

 

   Estate tax hike

Once again, this is an area being widely criticized, but again, let's put it into some perspective.

"The fiscal cliff deal raises the estate tax from 35 to 40 percent on the wealth passed from generation to generation. Now, while I would have liked to see the rate even higher than that and the exemption limit lower, I still have to score this one as a minor victory for Democrats. Remember, the original Bush tax cuts reduced this tax rate to zero. So where we are today is a big step down the road to where we should be. And please don't bring up the mythical family farmer. Republicans have been searching high and low for a family farmer who lost his land due to having to pay the estate tax -- searching for over a decade -- and yet they've never managed to find a poster-child family farmer to trot out in front of the cameras. It's a myth -- the way the tax is structured allows family farmers to cope with it when passing their land on to their children, so please, let's not even go there. The estate tax not only survived the fiscal cliff deal, but it has been increased. I'd like to see it changed even further, but it's hard to see how that's a bad outcome, for now."

 

   Ask an unemployed person

This one is for all those who aver that going over the fiscal cliff would somehow have been better than cutting a deal to avert the worst consequences of doing so.

"I know many Democrats were urging President Obama and congressional Democrats to just go over the cliff and be done with it. Obama, from new reports on the negotiations, actually used the threat of doing so quite effectively in the bargaining. But Obama doesn't have the luxury of treating the situation like a parlor game. Going over the cliff would have had some real-world consequences that were impossible for him to just ignore. So, to any Democrats grumbling that we should have Thelma-and-Louised right off the fiscal cliff, I have one thing to say: ask an unemployed person whose benefits were about to run out if they agree with you or not. Ask them whether they would have cheered Obama on while facing their own economic ruin. There were harsh realities involved in going over the cliff that have now been averted. While the deal certainly isn't what I would call perfect, it did save a lot of folks a lot of very real harm. Obama should be commended for his leadership in not allowing that to happen."

 

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The House of Representatives passed $9.7 billion in aid for Hurricane Sandy victims by a 354-67 vote on Friday. All no votes came from Republicans. The Senate is expected to pass the measure later Friday and send it to President Barack Obama.

Eugene Robinson, Indianapolis Star
WASHINGTON -- To say that Congress looked like a clown show this week is an insult to self-respecting clowns.Painful though it may be, let's review what just happened. Our august legislators -- aided and abetted by President Obama -- manufactured a fake crisis. They then proceeded to handle it so incompetently that they turned it into a real one.The bogus "fiscal cliff" -- and please, let's never, ever use those words again -- was designed as a doomsday mechanism to force Congress and the president to make tough decisions. But resistance to the very concept of...

WASHINGTON -- Vice President Joe Biden rallied Latino members of Congress on Thursday to push for immigration reform, calling Latinos "the center of the nation's future" and reminding them that their political power will only grow after the last presidential election.

"The way to make the mark ... is for the Hispanic community to step up and step out and let the world know, let the Republicans know, let others know that if you ignore the needs and concerns of the Hispanic community, you will not win," Biden said at a swearing-in event hosted by the Congressional Hispanic Caucus Institute, a nonpartisan group that runs programs encouraging Latino leadership.

A record 26 members were welcomed into the Congressional Hispanic Caucus, which is separate from the institute, on Thursday. Not all Latino members of Congress joined the caucus, but their total, too, is a record: There are three senators and 33 House members of Latino descent in the 113th Congress.

Many of them are strong supporters of immigration reform, which also ranked high -- though not first -- on the list of priorities of Latino voters. President Barack Obama has promised swift action and will begin major work on the issue this month now that the "fiscal cliff" battle is out of the way. Members of Congress are already beginning to craft a deal and hope it can receive a vote by the end of the summer.

The president made something of a down payment on his promise of reform last summer when he announced that his administration would grant deferred action on deportation for some undocumented young people, often referred to as Dreamers.

Before the deferred action announcement, Biden told Thursday's crowd, he and Cecilia Muñoz, director of the White House Domestic Policy Council, had met with now-retired Rep. Charlie Gonzalez (D-Texas), who chaired the Congressional Hispanic Caucus, to discuss what could be done for Dreamers.

Although deferred action was considered by many a risky political choice, Biden said he and Muñoz "absolutely believed that what we were about to do was not only the right thing to do, but that it would be embraced by the vast majority of the American people."

They found they were right, the vice president said. Obama won more than 70 percent of the Latino vote in his reelection bid.

Biden said the American people also recognize what Latinos, including those who are undocumented, can and will contribute to the country.

"It's no longer about what can be done for the Hispanic community," he said. "The question is what the Hispanic community is going to do to take this country to a totally new place."

HONOLULU -- President Barack Obama has signed a $633 billion defense bill for next year that tightens penalties on Iran and bolsters security at diplomatic missions worldwide after the deadly attack in Benghazi, Libya.

Obama had threatened to veto the measure because of a number of concerns, including limits on his authority to transfer terrorist suspects from the U.S. military prison at Guantanamo Bay, Cuba, for one year.

But Obama said that although he continued to oppose certain sections of the bill, "the need to renew critical defense authorities and funding was too great to ignore."

The bill includes cuts in defense spending that the president and congressional Republicans agreed to in August 2011, along with the end of the war in Iraq and the drawdown of American forces in Afghanistan.

A highly polarized country. A savagely partisan Congress. A brutal presidential race, which ended with the Democratic incumbent defeating his Republican challenger, an ex-businessman.

This was America in 1940 and early 1941 -- a period that the historian Arthur M. Schlesinger Jr would later label "those angry days" and one that bears striking parallels to today's poisonous political climate. Just as now, Americans were engaged in a bitter debate over the future direction of their country. World War II had just begun, and the question was: Should the traditionally isolationist U.S. come to the aid of Britain, the last European nation holding out against Hitler? President Roosevelt and other interventionists said yes, believing that Britain's survival was crucial to America's economic and physical security. The country's isolationists, a predominant force in the Republican party, argued that the United States was in no danger and must focus only on its own defense. Just as today, the president's re-election made no difference to his Republican congressional foes, who steadfastly refused to cooperate with him and his policies.

There was, however, one vital difference between then and now. In the midst of all the polarization and gridlock, a few prominent Republicans stepped up to do what they thought was right, defying their party and putting the interests of their nation and its people ahead of political ambition and partisan advantage.

The chief rebel was none other than Wendell Willkie, the 1940 GOP candidate for president. Instead of pulling a Mitt Romney-like disappearing act after the election, Willkie went on the radio to announce to the American people: "We have elected Franklin Roosevelt president. He is your president. He is my president... We will support him."

To the fury of the Republican old guard, Willkie endorsed 1941 legislation creating the Lend Lease program, sending aid to Britain, as well as backing the first peacetime draft, which made possible the huge U.S. Army and Air Force that took the field after Pearl Harbor. Roosevelt, who would later describe his former foe as "a godsend to this country when we needed him most," acknowledged that Willkie's support for those measures, both of which were crucial in winning the war, might well have made the difference between congressional victory and defeat.

Joining Willkie as GOP apostates were Henry Stimson and Frank Knox, the country's two most respected Republican senior statesmen, who became members of Roosevelt's cabinet and who, like Willkie, were essentially read out of their party. Neither much cared. As Knox told his friends, "I am an American first, and a Republican afterward."

Like Stimson and Knox, Wendell Willkie has disappeared into the mists of history, recalled, if at all, merely as one of FDR's defeated rivals. He deserves much more. Noting Willkie's moral courage and political leadership, MSNBC's Chris Matthews recently wrote, "I long for such a leader today."

WASHINGTON, Jan 1 (Reuters) - President Barack Obama departed the White House on Tuesday to resume his Hawaii vacation shortly after Congress approved legislation that raises taxes on the wealthiest Americans and avoids the "fiscal cliff" of across-the-board tax increases and spending cuts.

The president left the White House shortly before midnight. He had cut his vacation short on Wednesday to oversee negotiation of a deal before a year-end deadline.

John Stossel, FOX Business
In the short time since President Obama was re-elected, government has issued hundreds of new regulations. The bureaucrats never stop. There are now more than 170,000 pages of federal regulations.President Obama wants still more rules. Cheering on increased financial regulation, he said, "We've got to keep moving forward." To the president, and probably most Americans, "forward" means passing more laws.It is scary to think about a world without regulation. Intuition leads us to think that without government we'd be victims of fraud, as I explain in my latest...

Maureen Dowd, New York Times
Michael Bennet was supposed to be going off a cliff in Vail.But instead of his usual New Year’s trip to a ski lodge with his wife and three daughters, the Colorado senator found himself in a strange, unfamiliar place in the middle of the night: breaking with the president and his party to become one of only three Democratic senators and eight senators total to vote against President Obama’s fiscal deal.

Robert Samuelson, Washington Post
WASHINGTON -- The "fiscal cliff" is a massive failure of presidential leadership. The tedious and technical negotiations are but a subplot in a larger drama. Government can no longer fulfill all the promises it has made to various constituencies. Some promises will be reduced or disavowed. Which ones? Why? Only the president can pose these questions in a way that starts a national conversation over the choices to be made, but doing so requires the president to tell people things they don't want to hear. That's his job: to help Americans face unavoidable, if unpleasant,...

Jonathan Tobin, Commentary
There may be a last-minute compromise reached today in the negotiations over the fiscal cliff, but not if President Obama has anything to say about it. Even as Vice President Joe Biden and Senate Minority Leader Mitch McConnell were believed to have led the effort to have the structure of a deal in place for the two houses of Congress to vote on later today, the president emerged to make a statement that seemed geared to scuttling the negotiations.In a campaign-style event, the president spoke of a possible accord between the two parties that would avert the immediate effects of the fiscal...

WASHINGTON -- With hours remaining to avert the so-called fiscal cliff, President Barack Obama said a deal is “within sight” and urged lawmakers to come together to avert automatic tax hikes and spending cuts that kick in on Tuesday.

But his midday press conference, with a group of middle-class Americans looking on, was not without a bit of bravado as well. Obama took multiple shots at Congress for its clumsiness in negotiations and insisted that he'd demand more tax hikes if the legislative body used the impending debt ceiling standoff to demand spending cuts.

In the process, the president irked several Republican aides, who suggested that the entire fiscal cliff deal had been complicated because of his tone and criticism.

“Potus just moved the goalpost again. Significantly. This is new,” tweeted a top aide to McConnell.

Doug Haye, a spokesman for House Majority Whip Eric Cantor, tweeted, “If Obama's goal was to harm the process and make going over the cliff more likely, he's succeeding.” Another Cantor spokesperson said, “So....I'm confused....does POTUS want a deal or not? Because all those jabs at Congress certainly sounded like a smack in the face to me.

Sen. John McCain (R-Ariz.) said the president "sent a message of confrontation" to Republicans, who could be voting on a deal in the next 24 hours. "I'm not sure ... whether to be angry or to be saddened," he added.

A source close to House Republican leadership went even further, telling HuffPost that the lower chamber was in revolt over Obama's remarks and that the deal could blow up because of them.

To what extent these statements are bluster will be determined once the bill comes up for a vote. The president noted that "an agreement to prevent this New Year's tax hike is within sight," but added that "it's not done."

Before he spoke, The Huffington Post reported on details of a preliminary deal from negotiations between Senate Minority Leader Mitch McConnell (R-Ky.) and Vice President Joe Biden that would achieve $715 billion in revenue.

Under the framework, the Bush-era tax cuts would be extended permanently for individuals at $400,000 and joint filers at $450,000. A second Senate Democratic source familiar with the state of play confirmed those details. The top rate on ordinary income would go back to 39.6 percent and raise an estimated $370 billion in revenue over 10 years.

The same thresholds would be applied for capital gains and dividends, with the top rates in that case going up to 20 percent -- a concession to Republicans (the rate on dividends was set to return to 39.6 percent) but not far from the president's position during the campaign.

Though the president did not get into specifics, he noted that the agreement that was currently under discussion would permanently raise tax rates on the wealthiest Americans.

Both parties are still arguing over how to deal with the $1.2 trillion in sequestration-related cuts that will be triggered on Jan. 1. The president sent a strong message to Republicans that replacing those automatic cuts must be done in a balanced way and not through spending cuts alone.

“If Republicans think that I will finish the job of deficit reduction, through spending cuts alone -- and you hear that sometimes coming from them -- sort of, after today we're just going to try to shove only spending cuts down, you know, well -- shove spending -- shove spending cuts at us, that will hurt seniors, or hurt students, or hurt middle-class families without asking also equivalent sacrifice from millionaires or companies with a lot of lobbyists ... if they think that's going to be the formula for how we solve this thing, they have another thing coming,” Obama said.

Obama added that his preference has been to solve the country’s problems through a grand bargain, "but with this Congress that was obviously a little too much to hope for at this time."

President Obama is in the throes of the biggest financial challenge of his political career. The looming fiscal cliff will affect all Americans, quite likely to trigger a new recession if not averted. That is all Americans, not just the nouveau riche of the $400,000 set; it will affect us all. On the other side of the fiscal cliff, we would find finger pointing, blame, and change without hope.

Obama has reminded us that he won the election; he did. The definition of "rich" has been contracted from his initial $1 million salary; fair game? He promised to raise taxes on the rich in his campaign.

The president is at the very top of the government pecking order. In fact, he is the only person on the administration side of the bargaining table. It is a very lonely place with The House and Senate representing the American electorate with dramatically different posturing on the other side. President Obama's role as chief executive officer of the United States is to lead through these difficulties, reasonably review proposals to make certain we can tax appropriately while affording our expenditures. He is the driver, the head of this conglomerate called the United States. Being a strong supporter of collective bargaining, Obama must find himself in a conflicted role reversal of sorts.

In very relevant comparison to collective bargaining, there are expected norms that both sides must follow. That includes respect for negotiators, positions and interests, and fair evaluation of the proposals. This does not include disparaging comments and automatic rejection of proposals and solutions.

Speaker of the House John Boehner put a package on the bargaining table that reflects President Obama's previous bargaining position; a tax increase for those wage earners of $1 million or more along with spending cuts. But the rules of negotiations have changed. Obama won the election. In his victory speech, he said, "In the coming weeks and months, I am looking forward to reaching out and working with leaders of both parties to meet the challenges we can only solve together: reducing our deficit; reforming our tax code..."

He is now strengthening his resolve. His most memorable campaign promise was a tax hike for the "rich" and he won.

His goal of putting the U.S. on a path to cut deficits by $4 trillion over 10 years provides movement, but his plan proposes $1.3 trillion in new spending and an unlimited debt ceiling that is ready to blow. Not long ago, Obama warned that raising taxes in a struggling economy is "the last thing you want to do," but that is exactly what is happening. Most lawmakers think it is likely that we will not be able to resolve the fiscal cliff. A bitter pill provides difficult posturing.

An overwhelming number of voters, however, also realize that raising taxes will not in and of itself solve the budget crisis. While many Americans support tax increases for higher paid households, it is likely that changes in the tax code would resolve the issue more effectively. Sixty-seven percent think more will need to be done to close the budget deficit, compared to 19 percent that think tax increases alone will work and 12 percent who aren't sure.

According to the Tax Policy Center, the result of the fiscal cliff on American household would range from an increase of $1,064 for household income of $20,000 to $30,000; on a graduated scale to $254,637 for income of $1 million.

The president, the House and the Senate need to review the pulse of the American public. It's not only about a win in the presidential election. According to an NBC/Wall Street Journal:

• 68% view the fiscal cliff as very serious or serious
• 65% want to see compromise to reduce the deficit and cut spending
• Only 28% want to see Washington stick to their positions.

A similar Fox News poll revealed similar results:

• 89% want to see major cuts in spending
• 83% Democrats
• 91% Independents
• 95% Republicans

Rasmussen reports highest ever support for reduced government spending at 73 percent.

Washington, this is your electorate speaking. In any responsible and productive negotiation, facts and opinions are critical aspects of the outcome, most certainly the positions and opinions of constituents.

The fiscal cliff negotiation is a model for bad faith bargaining. Instead of accusations by Senate Majority Leader Harry Reid of wasting time and DOA proposals, public criticism and name calling, they need to take a critical look at the desires of the electorate. Reid referring to Speaker Boehner as a dictator does not foster cooperation in negotiations. Public perception is critical and the lack of fairness in this looming negotiation could result in taxpayer apathy. The result? Americans suffer, adjust withholding, reduce spending, slowing the economy.

In a sense, the elected officials that represent the American people are losing sight of what matters in the sake of their political views. The American electorate and economy is what needs to be in full view and primary consideration. The legacy that will remain long after the fiscal cliff negotiations are over is on the administration side of the table, the president. We will remember who the president was at the time of the fiscal cliff, but not too many other players.

Four years ago Barack Obama prepared to take the oath of office as a Democratic president, at a moment when free market ideology and Republican incumbency were disgraced by events. But a year that should have marked the end of the laissez-faire fantasy and the resurgence of effective government instead began an era of muddle through.

I have often quoted the British historian A. J. P. Taylor. Speaking of the revolutionary year in Europe, 1848, when democratic revolutions broke out only to be crushed, Taylor observed, "It was a turning point of history, but history didn't turn." In many respects, that also describes 2008.

The Republicans were voted out, but the big banks that caused the collapse were propped up rather than broken up. Their basic business model was allowed to continue, with taxpayers guaranteeing billion dollar paydays for corporate moguls. The economic rules of the game continued to tilt against regular working families, who are more precarious than ever. Obama took most of his economic advice from the very people whose belief in complete license for finance caused the collapse.

The administration played softball with a Republican opposition determined to wreck the recovery rather than allow Obama any victories. Democrats were almost as thoroughly in bed with Wall Street as Republicans. The mantle of populist frustration, absurdly, passed to the tea parties. Democrats, in the 2010 mid-term, suffered the worst defeat since 1938, a year when President Roosevelt listened to the Wall Street deficit hawks of that era.

But two years later, even muddle-through managed to beat muddled thinking. Mitt Romney divided his own party, committed one mistake after another; and despite one decent debate performance, he couldn't beat the incumbent even in a weak economy.

Now the political gods have granted President Obama a do-over. It remains to seen whether he will use it to maximum advantage.

If anything, circumstances at the start of Obama's second term are even more auspicious for the president and the Democrats than they were at the beginning of his first term, after Wall Street crashed the economy.

How far are Republicans out of touch with public sentiment? Let us count the ways.

The president, sensibly, has jettisoned the bad idea of a grand budget bargain that would result in serious cuts to Social Security and Medicare. He is trying to enlist Republicans to support a small bargain that will avert a contrived fiscal contraction -- no tax hikes on 98 percent of Americans, and the continuation of benefits for upwards of two million long-term unemployed.

The White House and Congress, having avoided the worst of the fiscal cliff, could then continue to debate other budget issues, like how to avoid the "sequester" of devastating automatic cuts and how to arrest the inflation in medical costs without cutting into medical care.

Most Americans oppose a tax increase on the middle class and support one for the rich. Obama was very effective on Meet the Press, reducing the budget debate to that simple essential issue.

But the Republicans in Congress are so dysfunctional that they may not be able to avert bearing responsibility for a tax hike that nobody wants. Even after President Obama tentatively offered to raise the income cut-off for a tax increase from $250,000 a year to $400,000 a year - limiting tax hikes to the top one percent, neither House Speaker John Boehner not Senate Republican Leader Mitch McConnell could bring himself to support it. Both prisoners of legislative caucuses even more extreme than they are.

Earlier in the negotiations, Obama had opened the door to adjusting the cost of living adjustment formula -- the so-called chained CPI -- as a backdoor way of cutting Social Security, in the context of a bigger budget deal. This was both a tactical and a policy mistake, and it gave Senate Republican Leader McConnell a basis for demanding more concessions from Democrats in return for agreeing to higher taxes on the rich. But Senate Democratic Leader Harry Reid, sensibly, wants nothing to do with any kind of cuts in Social Security, back door or front door.

The Democrats have the strongest hand when they keep the basic issues clear and simple. Eventually, the budget deal being offered by President Obama or something very much like it will be made. The only question is how much damage the Republicans do to themselves and the economy in the meantime. If no deal is struck before January 1 and taxes briefly go up on everybody while financial markets swoon, the pressure on Republicans only increases.

And that isn't all. In the new Congress, the Republicans will find themselves on the wrong side of other high-profile issues, ranging from gun control to immigration reform to same-sex marriage, as well as protecting Social Security and Medicare from cuts that are less about "saving" these programs than about saving tax breaks for the rich.

On all these issues, there is no question that President Obama will be on the right side of public opinion. The only question is whether he will lead public opinion.

Over the pre-New Years weekend, President Obama was sounding like a partisan, albeit a reluctant one. He should not be so reluctant. A radical, obstructionist, and dysfunctional Republican opposition in the House and Senate stands between the country and the policies that the economy needs and that the majority of Americans want.

The president was right to call the Republicans on taxes. As the New Year wears on, he should do the same on gun control, immigration reform, and gay and lesbian rights.

Obama wanted to be the president who would change the tone in Washington, meaning a more collaborative relationship with the Republicans. That was not to be. The Republicans would not allow it. Now, history invites Obama to change the tone in Washington by dispatching an extremist Republican Party to the far fringes of public discourse where it belongs.

Robert Kuttner is co-editor of The American Prospect and a Senior Fellow at Demos.

This week, Gen. Norman Schwarzkopf died, Vladimir Putin signed a bill banning the adoption of Russian children by Americans, and our economy continued to speed towards the fiscal cliff, with Harry Reid accusing John Boehner of waiting until he is reelected as Speaker before seriously negotiating a deal, and the president demanding an up-or-down vote on a stop-gap measure. The poor beached whale that died in Queens, New York midweek seems a fitting metaphor for our political system. On a more positive note, a gun buyback event in Los Angeles was so successful the police ran out of the gift cards that were being exchanged for the turned-in weapons (including 75 assault weapons -- and a pair of rocket launchers). Many of those giving up their guns said they were doing so as the result of the Newtown massacre. Here's hoping that's a trend that extends into the new year.

President Barack Obama is urging the Illinois General Assembly to legalize gay marriage in his home state as lawmakers are poised to take up the measure as early as this week in Springfield.

By David Ingram

WASHINGTON, Dec 28 (Reuters) - An effort led by U.S. Vice President Joe Biden to find ways to reduce gun violence after the Connecticut school massacre so far has not included talking to the National Rifle Association, the president of the gun rights group said on Friday.

NRA President David Keene said neither Biden nor his staff has contacted the organization since President Barack Obama unveiled the effort on Dec. 19.

Keene said he was not surprised, given Biden's past support for new gun control laws. "He's not even a friendly antagonist," Keene told Reuters in an interview.

The lack of communication between the White House and the largest U.S. lobbying group for gun owners is a sign that the shooting in Newtown, Connecticut, has so far failed to change long-held stances on gun politics. In that tragedy, a young man shot his mother with her own gun before killing 20 children and six adults at the Sandy Hook Elementary School.

Biden and up to four Cabinet officers are holding a series of meetings with outside groups to discuss possible gun legislation. The first was with law enforcement officials, another with mayors.

The White House has said other meetings will take place with gun safety groups and gun owners, among others, but it has not said whether the NRA will be invited. The White House had no comment on Friday.

Asked about the organization's influence, Obama struck an optimistic note on Dec 19. "The NRA is an organization that has members who are mothers and fathers," he said. "I would expect that they've been impacted by this as well, and hopefully, they'll do some self-reflection."

Two days later, NRA executive Wayne LaPierre said at a press conference that new gun laws were not the answer, calling instead for some form of armed guards in every school.

Keene told Reuters: "I'm willing to talk to anybody. I'm willing to sit down with anybody up there." He added, though, that he would not agree to "gut" gun rights.

"I'm going to want to have a conversation about how we protect our children," he said. "That's a serious conversation. Offering sort of feel-good bills doesn't strike me as serious."

Biden's group is due to offer its recommendations in January.

A Reuters/Ipsos poll on Thursday found that support remains high for preserving specific gun ownership privileges, such as concealed-weapon permits, as well as for some restrictions, such as background checks for every purchase.

Forget the fiscal cliff. The real threat to the U.S. economy is not political stalemate in Washington but the Republican party itself.

From the time that President Obama first took office in 2009 through the elections in 2012, the GOP has been running on the platform of economic despair, and in fact, seems to have bet its entire future on it.

In the beginning it was easy, since the president had just inherited a massive financial crisis and a shattered economy that would take years to rebuild; all the Republicans had to do was stonewall any initiatives that would hasten a recovery, and wait. That gave them the edge they needed to rout the Democrats in the midterm elections. Following that, they adopted the strategy of blaming the financial stimulus package and Dodd-Frank for the continuing softness in the economy, which kept the pressure up on Obama and, more importantly, kept him on the defensive.

But now the landscape is different. Obama has four more years to do his thing, the disastrous Mitt Romney campaign has damaged the Republican party immeasurably, and the economy is visibly recovering, so the Republicans cannot just sit back and hope that everything will go wrong anymore. If the economy continues to grow, the president's second term will be a victory, period. That means the Republicans actually have to make sure it goes wrong -- or any hopes that they have of making meaningful gains in future elections will be dashed.

Which is why their new strategy is to actively derail the economy.

Think of it as the Republican long game -- if the U.S. falls back into a recession, the president's promises of a better future will be perceived as empty rhetoric and the Democrats will lose credibility, paving the way for Republican victories in 2014 and 2016. It may be pretty devious but it is also that simple.

To accomplish this goal, the Republicans seem to have settled on two angles of attack:

Cut Spending till it Hurts

Republican posturing on the fiscal cliff has revolved mostly around lower taxes for wealthy Americans, but what they really want is deep cuts in government spending (taxes are mainly a bargaining chip). The problem, of course, is that deep cuts in spending right at the cusp of economic recovery will likely send us back into a recession. From outright unemployment for federal workers to cuts in state and local government grants, spending cuts would stifle national growth almost overnight. The setbacks would impact nearly every sphere, including infrastructure, education, healthcare, financial reform, and consumer protection, leading to "domino effect" declines in consumer confidence, spending, commercial activity, employment, and ultimately the economy.

Granted we have a trillion-dollar deficit problem but deficit reduction also requires GDP growth and an increase in the tax base, which cannot happen in a declining economy; not to mention that any action that slows our momentum at this time would be counter-productive to the deficit in the long run since we will simply have to run up a bigger tab later.

The right approach would be to phase in spending cuts slowly and time them to succeed economic growth, not precede it. But that timeline would not suit the Republicans at all since it would take us further into Obama's term and enable him to take credit for a good economy. So, regardless of the fiscal cliff outcome, you can bet that the GOP will flog this horse well into next year and keep pushing for deeper and deeper cuts until they strike bone.

Manufacture Uncertainty

Nothing pours cold water on economic growth like uncertainty. When the rules of the game are defined clearly, even if they are unfavorable, all players can strategize accordingly and aim for success; but when businesses and consumers have no idea what is going to happen next, their plans just stall in the mire of nervousness. That is what happened during the debt ceiling debate of 2011 and in painful slow motion this year on the fiscal cliff. Despite dire warnings by economists of another recession if America goes over the cliff, and despite the financial soundness of letting the Bush tax cuts expire for the rich, the Republicans have done everything in their power to prevent a compromise from being reached. The net result has been an unnecessarily prolonged period of uncertainty and market tumult.

This is a clear-cut case of obstructionism with a purpose, and it will not stop with the fiscal cliff either. Christmas may be over but for the Republicans the first half of next year is an extended holiday season, with gifts ranging from another debt ceiling fight to further arguments on tax cuts and Wall Street reform all waiting to fall into their political laps. And they will exploit it all to create as much uncertainty about the future as they can, for that is the surest way to derail our economic progress and ensure that President Obama does not preside over a prosperous country for the next four years.

Compromise might help the Republican party regain its credibility with American voters but then Republicans have never been good at fighting from a positive place. They are much more comfortable playing offense, and that is why they will kill our economy if they can -- because it is their last, desperate, hope for survival.

So how will it stop?

It won't, unless the American public pulls their support of the party completely. Even if you agree with the Republicans ideologically, you should ask yourself whether a party that is willing to destroy your livelihood for political gain should be allowed to represent you at all... and then vote the opportunists out of office before they ruin the country!

SANJAY SANGHOEE has worked at leading investment banks Lazard Freres and Dresdner Kleinwort Wasserstein as well as at a multi-billion dollar hedge fund. He has an MBA from Columbia Business School and is the author of two financial thrillers, including "Merger" which Chicago Tribune called "Timely, Gripping, and Original". Please visit his Facebook page for more information.