Mario Cuomo drew the distinction between “the poetry of campaigning” and “the prose of governing” in 1982, but he embodied it a bit too well: He electrified the Democratic National Convention of 1984 but never made his own bid to govern nationally.

That has made Barack Obama the first likely liberal-Democratic nominee to tap the mystic chords of memory and destiny since 1980, when Ted Kennedy, conceding defeat in the primaries, vowed, “The cause endures, the hope still lives, and the dream shall never die.”

Kennedy has endured, but even if his passing the torch to Obama last week propels the latter’s nomination, we’ll be only halfway to the convergence of mythic currents that would have occurred in 1980 had Kennedy faced that other poet of the republic, Ronald Reagan. Jimmy Carter did that, but even as an incumbent he was no more a poet than is the quasi-incumbent Hillary Clinton.

Two great American crosscurrents -- of liberal communal provision, without which conservative individuality can’t flourish, and of conservative personal responsibility, without which even the best liberal social engineering produces clients, cogs, or worse – can converge only if John McCain and Barack Obama face off.

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By now you’ve probably heard that the job market tanked last month. The number of jobs out-and-out declined for the first time in almost five years. But the unemployment rate is still really quite low. What’s going on?

Today’s report from the Bureau of Labor Statistics showed the unemployment rate falling from 5.0% to 4.9%, though it was essentially unchanged (to 4.93% from 4.98%). The real question is how can folks like me argue that a recession is imminent or perhaps even underway with unemployment this low?

Let me count the ways.

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Hey folks.  Welcome to the new site.  Please excuse the mess for the next few hours while we sort things out.  We have to swap in new and pretty pictures, put in content that the database didn't get, fun stuff like that.  But pretty soon, we'll be up and moving!

Hope you like it.

Update: Looks like it may be a little more than the next few hours.  We're working constantly to get everything up and running, sorry for the trouble.

Late Update: A few people have emailed me to note the fact that they sometimes see this site, sometimes the old Cafe site.  That should end soon, basically the site is moving from one server and design to another and is schizophrenic for the afternoon.  This is a 24 hour process max and should be cleared up by morning.  Thanks for your patience.

Here we are, days from Super Tuesday, and the Israeli-Palestinian conflict has barely been mentioned by any of the candidates. If past history is any guide, it won't be mentioned much and, when it is, only in front of Jewish audiences where effusive utterances of support for Israel will be offered.

We all know why. Candidates fear to speak with any candor about Israel because they suspect, and not without cause, that the only people paying attention to what they say will be zealots.

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Despite the unremarkable past of its current resident, the White House has often been occupied by those who bring extraordinary life stories with them. The man from Hope. The cowboy movie star. The war hero. That Barack Obama's candidacy has been fueled by his own biography should therefore come as no surprise. Obama certainly hasn't been afraid to tell his tale. From his 2004 DNC convention address to the stump speech he bangs out today, we hear the details: the half-Kenyan, half-Kansan who became the first African-America to…oh, you know the rest. It's already history. Yet Obama's story is different.

It can't be neatly categorized away or seen as the life of a stock character. There's the childhood in Indonesia and Hawaii, the drug use, the brilliant scholarship, the community activism—Obama, unlike previous presidents, can't be pinned down to a single word. I've never met anyone precisely like him, and I don't think anyone else has either (except, yes, of course, Obama's friends). Yet in this day and age, chances are most of us can relate to the lack of easy definition surrounding Obama.

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You will see folks - including in comments in my last post - repeating the contention that the current wave of anti-immigrant politics is just about being against "illegal immigration," not against immigrants more generally. While a few folks may think they mean it, it's clearly untrue.

Most obviously, unless you support increasing legal immigration to match current levels of undocumented immigration, a crack down on undocumented immigration is support for a net reduction in overall immigration levels. But the harder reality is that the policy attacks on undocumented immigrants inevitably bleed over into attacks on legal immigrants.

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Turns out Senators Grassley and Baucus would have supported a stimulus package that aimed much more at those in need than what the House agreed to do with the President.

So why didn't Speaker Pelosi work with the Senate instead of compromising with the White House? Perhaps the last year of disappointment with Senator Reid's leadership had an impact. But the White House effectively divided the House and Senate, and again worked to benefit the well-off under the guise of helping those in need. Another tactical success, moral failure, surely wrong policy, and proof that the Democrats in this Congress are, for more than one reason, not as effective as we could hope.

Earlier this afternoon (Jan. 31), the telephone industry took to Capitol Hill with yet another plea for unlimited freedom. In this case, Congressional staffers heard from CTIA, the wireless trade group, about the awful, dreadful consequences of subjecting poor, understaffed and beleaguered companies like AT&T and Verizon to a little bit of government oversight.

That would be the AT&T that reported $3.1 billion in earnings and picked up a net 2.7 million wireless subscribers in the fourth quarter last year. According to AT&T, that increase is “highest quarterly subscriber increase ever for any U.S. wireless provider” and brings the company’s total to 70.1 million with some healthy returns to boot. That would be Verizon which reported a mere $1 billion in earnings for the quarter while adding 2 million wireless customers to bring its total to 65.7 million.

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It's been a long time coming, but we're excited to announce that a new and improved TPMCafe is going to be launched in the next day or so.

Let me tell you a little about what to expect.

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One of the more gratifying aspects of Rudy Giuliani’s Florida debacle went unmentioned – perhaps because it was thought unmentionable -- in the otherwise-triumphalist primary night reportage by Brian Lehrer on New York City’s NPR station WNYC (which Rudy once tried to close down) and in the New York Times’ front-page Rudy post-mortem-cum-victory dance by Michael Powell and Michael Cooper:

Giuliani got nothing from ageing, mostly Jewish ex-New Yorkers in Florida, whose support he’d pursued as assiduously as his campaign foreign-policy advisor Norman Podhoretz had done for years in his neo-conservative Commentary magazine. No wonder the neo-cons are scurrying over to the USS McCain now and battening onto it like barnacles below the waterline, hoping to sail it to victory in Iraq and Iran.

McCain is as wrongheadedly pro-war as Giuliani but more honest and decent about it. He’ll tolerate neo-cons if they're quiet; he'll even rely on the inevitable swift-boating of the Democratic nominee by Rupert Murdoch and whoever becomes the general-election’s Karl Rove, although he’ll piously disown what they do.

Always too clever by half, neo-cons have slithered so shamelessly from debacle to debacle that someone has to shout, “There you go again!”, especially at Times columnist David Brooks, who keeps fooling some of my well-meaning liberal friends into thinking he’s carving out a new centrist decency. This long-time, diehard Rudy lover is just angling to reel you in toward McCain.

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Bank of America’s plans to buy Countrywide may not mean an improvement in the way borrowers and customers are treated. While Countrywide has its share of complaints and legal problems, Bank of America’s reputation is in question as well.

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Phil Tedesco’s post, “Giving Health Care Away,” reminded me of yesterday’s New York Times article about CheckUps, a privately owned, for-profit chain of walk-in medical clinics housed primarily in Wal-Mart stores throughout the country. The article announced that CheckUps has shut down 23 of its Wal-Mart-based clinics, “apparently running short of cash to pay its bills,” according to a lawyer for one of its creditors.
CheckUps is just one company among several in a rapidly expanding model of health care delivery, often called “retail health care,” that is proliferating in grocery store and drug store chains throughout the country. While some of the clinics are head up by doctors, most are run by nurse practitioners who are limited to providing only routine medical care, like giving flu shots or prescribing drugs for sore throats. Visits are estimated to range between an average of $40-$60.

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Immigration was the issue that many on the Right-- especially panderers like Romney -- thought would define the 2008 elections. And it was the issue that was supposed to help doom McCain among GOP voters. Instead, it was the issue that in the end probably killed Romney's last hope of getting the nomination. And the GOP will likely nominate one of the key authors of the supposedly hated comprehensive immigration reform legislation.

There is some justice that it was GOP Hispanics who delivered the death blow to Romney. McCain led Romney is a number of demographic groups, but it was Hispanics -- more than veterans or elderly voters -- who gave McCain a disproportionate number of their votes. McCain received 54% of Hispanic voters to the 14% of Hispanics who supported Romney. With Hispanics making up 12% of the GOP primary voters and that difference, doing the math, adds up almost exactly to the overall 5% McCain margin of victory in Florida.

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Yesterday, the U.S. House of Representatives overwhelmingly approved a $146 billion economic stimulus package worked out by House and administration negotiators. At the heart of the package is a tax rebate that would provide checks of up to $600 for individuals and $1,200 for families. The rebate would be available to taxpayers earning over $3,000 in wages and would be phased out for individuals earning over $75,000 and families earning over $150,000. The price tag for the tax rebate would be just under $100 billion.

But the Senate has different ideas. The Senate Finance Committee will meet today to debate and vote on a plan that provides a somewhat smaller tax rebate – $500 and $1,000 to individuals and families, respectively, who earn at least $3,000 but treats Social Security retirement benefits as taxable wages, meaning that no- or low-income seniors would also qualify. The Senate tax rebate plan removes the cap found in the House-administration plan and costs roughly $120 billion.

There are many other differences between the two proposals, but the key differences in terms of equity and efficacy of the stimulus package relate to the plans' divergent provisions regarding the $3,000 wage floor and the $75,000/$150,000 ceiling. A compromise between these plans, one that would eliminate the floor and restore the ceiling, would provide more cash to those who need the rebate most, provide greater stimulus to the economy, and would save money in the process.

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The Hazard of Moral Hazard

Announcing EconoCorner

First, there’s been a great deal of hand-wringing regarding the dangers of current efforts to stimulate our ailing economy, which grew a scant 0.6%—spitting distance of zero—in the fourth quarter of last year. The worry is that by applying all this monetary and fiscal stimulus, we are simply recreating the very conditions that got us here in the first place. By easing the terms of credit, coming to aid of mortgage defaulters, and air-dropping tax rebates, we’re reflating the bubble and ignoring moral hazard (the theory that folks will under-price risk if their bets are covered). I get the point, and it’s a good one, but I disagree.

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John Edwards will be dropping out today at 1 PM.

What'd you think of his race? What will he do next? And, most importantly in the short run, where do his votes go?

Share your wisdom.

As a public service, I'm posting this blog entry in full by a friend of mine, Bernie Avishai who is a journalist living partly in Jerusalem, part-time in the U.S. His blog is: http://bernardavishai.blogspot.com/ He eloquently lays out a narrative about Barack Obama and an American dream:

"Tuesday, January 29, 2008 My Jewish Problem—And Ours In 1963, the young editor of Commentary, Norman Podhoretz, wrote a strangely confessional article (the first intimation of what, full-blown, would become his style), which he called “My Negro Problem—and Ours.” Its disquieting point, made the year of the March on Washington, was that too much hatred attached to race for integration ever to succeed. Podhoretz offered himself as evidence, confessing to the fear, envy and contempt with which he had grown up in Brooklyn under the siege of “Negro gangs.” Those streets still seemed to him world-historical ground: “There is a fight, they win and we retreat, half whimpering, half with bravado. My first nauseating experience with cowardice, and my first appalled realization that there are people in the world who do not seem to be afraid of anything, who act as though they have nothing to lose.” His solution was radical, and a little titillating, given his admitted weakness for blacks’ “physical grace”: racism could be ended only by mixed raced marriages, what was called (though not usually by people from the Upper West Side) ”miscegenation.” Ultimately, whites and blacks would pair off, have children, and raise up a new American type; “the Negro problem can be solved in this country in no other way.” Indeed, if his own daughter should wish “to marry one,” Podhoretz wrote, he would “rail and rave and rant and tear out my hair,” but then he would hope to have the “courage,” the manliness, to do his “duty” and offer his blessing. What then of the future of American Jews? Podhoretz wasn’t sure, but then he also wasn’t sure why he should be sure. “I think I know why the Jews once wished to survive, though I am less certain as to why we still do. They not only believed that God had given them no choice, but were tied to a memory of past glory and the dream of imminent redemption.” Podhoretz thought it unnecessary to add that educated American Jews did not think this way anymore. Except for the (quaint) Orthodox—or except in the metaphorical sense—Jews did not really believe they had commandments to perform. The categorical imperative was to get a degree."

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Way back in mid-January, when the Washington policy herd had not yet determined that the economy needed stimulus, The Washington Post ran an editorial in which it held out the prospect that a recession may not be severe. This comment was intended to calm readers and slow the rush to stimulus. (The Post editorial board flipped the following week and joined the rush to stimulus.)

Still, the Post was right. We don’t know how severe this recession will be. My bet is that the loss of $4 trillion to $8 trillion in wealth due to the collapse of the housing bubble will lead to a serious recession. But perhaps the Post's optimism will prove correct; what will the world look like?

My colleague at CEPR, John Schmitt, did some quick calculations to remind people what happens in recessions.

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A new study reported this morning in The New York Times further undermines the moral hazard myth in health care. Republicans drone on that patients should see themselves as “consumers.”  According to this theory, to reign in health care costs, the system should make them visible so that patients won’t consume more than is optimal. This is the (ostensible) central thrust behind Health Savings Accounts (accounts, which accompany high-deductible plans, in which “consumers” can put pre-tax dollars for medical expenses and keep any remainder). It turns out, when these costs are made visible, people do seek less treatment, but they don’t seek treatment more intelligently. When charged a co-payment for mammograms, women sought them 8% less, even when controlling for income and education, and hence got cancer more often (not only personally tragic but astronomically more expensive). Giving health care away is not just the right thing; it also costs less.

The good news for Barack Obama just keeps on coming! After months of flirting with Chris Dodd and then hoping that John Edwards sticks around in the Democratic primaries, talkin’ health care and generally makin’ trouble, I have finally decided to endorse Obama for President.

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Today’s Washington Post explores lifetime benefit caps, provisions of most private health insurance policies that limit the total amount of expenditures an insurer will pay, with these limits typically falling in the one- to two-million dollar range. These lifetime caps and other insurance gaps like high out-of-pocket maximums and uncovered medical services are colliding with escalating health care costs to force questions about just what it means to have health insurance anyway.

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Ben Stein, the conservative writer, commentator, speechwriter, and actor, writes this week in the New York Times of Trader Realism – the extraordinary power that traders have to determine the fate of the economy. The traders don’t use data to drive their investments: they cherry-pick facts, spread rumors, and encourage misperceptions in order to make as much money as possible.

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Government is calling on the American consumer to pull us through one more time. Congress and the White House want families to spend-spend-spend to restart the American economy and prop up world markets, and they are even offering a few hundred bucks to get started. The government is like a coach who turns to a battered athlete and asks him to play his heart out one more time, but no one asks how much longer he can keep doing this. The American consumer is exhausted. Debt loads now exceed annual income. The proportion of income that goes to interest payments is at record-breaking highs. Twenty-three million families cannot make more than the minimum payments on their credit cards. One in four families say they are worried about how they will pay their credit card bills this month. Nearly half of all credit card holders missed at least one payment last year, and an additional 2.1 million families missed one or more mortgage payments. (Data cited here and here.)

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My New America Foundation colleague Parag Khanna has a vital article out today in the New York Times Magazine titled "Waving Goodbye to Hegemony."

While scenarios of the world's geostrategic and geopolitical future are proliferating today not only i Khanna's essay but in other provocative articles like "After Iraq" by Jeffrey Goldberg, Khanna's comprehensive approach to the question of America's future makes a great deal of sense to me.

What I like most is that he articulates what I've been sensing for some time in the global marketplace of power. Other nations aren't going to count on America's guarantees quite as much as before. They are filling the void of America's perceived decline with their own plans and pretensions and gambling that tomorrow's future will be far more fluid than yesterday's -- and that some of America's allies and foes will be able to surf this lack of global equilibrium into a better position.

Khanna perceptively writes:

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It is certain that the Clintons' thousands of friends are cringing, turning away their attention out of sheer shame, grimacing, as they read the former President's derogatory dismissal of Obama's landslide victory as no different than Jesse Jackson's win there. But it's important to scrutinize what the Clintons are doing and how it might work out.

Most notable about the South Carolina results was that Hillary did not get a majority (based on exits) of any racial or gender-based demographic. She is famous; obviously she has a great deal of money and support from the old guard of the party, such as it is; and she is very well-prepared on policy. But she is not tremendously popular. She was wrong on Iraq; she has little personal record of fighting for a cause; she offers a management-style Presidency as opposed to visionary change.

Most of Hillary's votes appear to come from women, seniors, and lower income voters. These demographic groups could turn to Obama. She has not aroused passionate commitment by them.

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