If I could say two things to President-elect Barack Obama today, I would first express my gratitude for making me proud to be an American again. His campaign and election did that. And, second, I would tell him that he has more opportunity to transform the Middle East than any previous President.

Barack Obama's opportunity was created by his unique background, his historic victory, and by the Gaza war. Had it not been for the war, Obama might have been able to take his time before addressing the Israeli-Palestinian conflict. He promised to deal with it during his first year in office, which meant he had until December 2009. That luxury is now gone. He must deal with the Middle East immediately.

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As we near the end of our week's discussion, Siva approriately directs our attention to the conjunction of Google and the incoming Obama administration. I'd like to offer a few comments on one of the issues Siva raises, the appropriateness of the federal government anointing YouTube as the home of videos of government hearings.

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As President Bush is packing, a review of his legacy is starting in earnest. Much of it is troubling at best, and all too often, it is profoundly regrettable. However, he deserves kudos for the way his administration dealt with Libya. Even more important: It suggests steps the next administration should consider in dealing with other rogue states.

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Have the Neo-Hooverite Republicans no sense of irony?

Some conservatives have argued that the law creating the program, the Emergency Economic Stabilization Act of 2008, which Congress passed hastily in October, violates constitutional principles that limit the amount of power that lawmakers can delegate to the executive branch.

These same conservatives have for 7 years steadfastly supported the delegation of the power to wiretap, torture and go to war to the executive branch without limitation. I can't wait for Stephen Moore and the Wall Street Journal Editorial Board to weigh in on this one.

You have to read this exchange between Bill Moyers and Abe Foxman. It leaves even me (almost) speechless.

Foxman says that by criticizing the war, Moyers demonstrates "moral equivalency, racism, historical revisionism, and indifference to terrorism...."

Bill Moyers, a southern Baptist from Texas, a preacher no less, is the then 20-something who came to Washington with Lyndon Johnson and worked with him to enact the Civil Rights and Voting Rights Acts, and a host of other progressive legislation that transformed America and, additionally, made the election of Barack Obama possible . Moyers, who resigned as LBJ's aide in 1967, largely because he could not stomach the Vietnam war, is about as free of any kind of prejudice as any person I've ever met and his life story proves it.

The big difference between Bill and some of his critics is that he moved beyond his parochial past and embraced the cause of humanity -- unlike his critics whose humanitarianism extends almost exclusively to their own and who would never criticize any human rights violations by their own.

It is humanitarianism on the cheap. You criticize what random "others" do but keep silent when it is your side. Picture a Serbo-American who protested all kinds of defamation and human rights violations but defended every Serb action in the wars against Croatia or Bosnia. Or a Russian human rights activist who kept silent about Chechnya.

Transparently hypocritical, right? And so are the attacks against critics of the Gaza war. Human rights activism, when not applied to your own "side," is utterly worthless.

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Today over at the Mothership (that's the TPM Front Page) we see one of the "wire" stories that the General Services Administration is negotiating with YouTube (a Google service) to post federal hearings, etc.

Given the uncomfortably close relationship between Google execs and Obama, should we be worried about this? I think so. YouTube is already the default video platform on the Web. But it does not have to be. And there is no clear reason for the government to solidify YouTube's market dominance. In fact, there is no reason why the GSO could not mandate that all federal agencies post their videos in open forms -- accessible, repostable, and mashable -- on their own sites.

Then We the People could repost them on YouTube with commentary and maybe some cartoon graphics mixed in. Better yet, because .gov can't deal with the bandwidth demands of too many folks pulling down popular videos, the federal government should post open format video as bittorrent files.

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The latest data show one out of ten homeowners in the United States is either late in making a mortgage payment or in such serious arrears as to risk foreclosure. Last week, congressional Dems breathed a sigh of relief when Citigroup dropped its opposition to a proposed change in the bankruptcy laws allowing distressed homeowners to do what owners of commercial property and second homes can already do when they can't pay up -- use bankruptcy proceedings as a means of working out better deals. (It's called a "cramdown." The practical effect wouldn't be hundreds of
thousands of bankruptcy judges striking new deals, as conservative lawmakers predict; the mere option of going into bankruptcy would give homeowners more bargaining leverage with mortgage lenders in striking better deals.)

As long as Citigroup opposed this measure, it didn't stand a chance. Citi's clout in Washington is legendary. But on January 8, Citigroup's CEO, Vikram Pandit released a statement saying that Citi "believes it will serve as an additional tool to the extensive home retention programs currently in place to help at-risk borrowers." The announcement was greeted with kudos by House and Senate Dems. The bankruptcy provision is now moving, and is likely to be attached to the stimulus bill.

What happened?

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The latest data show one out of ten homeowners in the United States is either late in making a mortgage payment or in such serious arrears as to risk foreclosure. Last week, congressional Dems breathed a sigh of relief when Citigroup dropped its opposition to a proposed change in the bankruptcy laws allowing distressed homeowners to do what owners of commercial property and second homes can already do when they can't pay up -- use bankruptcy proceedings as a means of working out better deals. (It's called a "cramdown." The practical effect wouldn't be hundreds of thousands of bankruptcy judges striking new deals, as conservative lawmakers predict; the mere option of going into bankruptcy would give homeowners more bargaining leverage with mortgage lenders in striking better deals.)

As long as Citigroup opposed this measure, it didn't stand a chance. Citi's clout in Washington is legendary. But on January 8, Citigroup's CEO, Vikram Pandit released a statement saying that Citi "believes it will serve as an additional tool to the extensive home retention programs currently in place to help at-risk borrowers." The announcement was greeted with kudos by House and Senate Dems. The bankruptcy provision is now moving, and is likely to be attached to the stimulus bill.

What happened? Until last Thursday, Citi had been a leader of the Bankruptcy Coalition of the Financial Services Roundtable, an industry group that had staunchly opposed the bill -- along with Bank of America, JP Morgan Chase, and Wells Fargo.

Could it be that Citi's Pandit knew last week that he'd soon need even more help from Congress than the $45 billion bailout the bank already received? Shares of Citigroup had seemed to regain their footing after the bailout. But then, this Monday, all hell broke loose. Citi shares plunged 17 percent, as investors got word of a deal Citi was cooking to sell its valuable Smith Barney brokerage unit to Morgan Stanley. The drop in Citi shares brought the stock back to the lowest level since the government gave Citi its first dollop of bailout funds last November. Citi is losing capital at an astounding rate -- nearly $100 million a day in the fourth quarter alone. Today the firm posted a loss of $8.29 billion for the fourth quarter, completing its worst year in history.

Citi has already got the sweetest bailout deal of any big bank, but the probability seems high that it will want more bailout money. This is the easiest explanation for Pandit's turnaround on the cramdown legislation -- something the Democratic Congress and distressed homeowners very much want.

In other words, the Wall Street bailout has had exactly the same effect for Congress that the proposed bankruptcy provision would have for homeowners -- it has increased its bargaining power over those who ordinarily pull the strings. The massive tax-payer financed bailout of Wall Street, largely a product of Wall Street's power in Washington, seems to be weakening the Street's ability to veto financial legislation it doesn't like. I'm not sure whether this is something we should be celebrating as a small victory for democracy, or condemning as an extortionate price for reducing Wall Street's grip.

A lot of school reformers argue that one of the wonders of charter schools is that they escape teacher union rules to better serve student needs (which of course explains why non-union states like Mississippi lead the nation in excellent schools). But even the premise that lack of unions improves the teaching environment is challenged by teachers, including increasingly by those at charter schools themselves.

In New York City this week, teachers at one of the supposedly star charter schools in the city, KIPP AMP Charter School in Brooklyn, informed the co-principals that they were organizing themselves into a union. In a letter to management, the teachers argued why unionization is critical for improving the teaching environment at the school:

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The government just handed another $20 billion to BOA and agreed to guarantee $118 billion of presumably bad assets. (You don't have to guarantee good assets.) This is on top of the $25 billion that we gave to BOA in the first bailout back in October. The combined $45 billion is almost equal to BOA's current market capitalization of just over $50 billion. In other words, with the money and guarantees that we gave BOA, the taxpayers could own BOA outright.

I don't especially want to own BOA, but it does seem outrageous that school teachers and firefighters are being taxed to pay 7-figure salaries to Ken Lewis and the rest of the top executives and to keep BOA shareholders happy.

We have a deal. You, US taxpayer, have generously provided to Bank of America the following: one Treasury-FDIC guarantee "against the possibility of unusually large losses" on a pool of assets taken over from Merrill Lynch to the tune of $118bn, and a further Fed back stop if the Treasury-FDIC piece is not enough. In return we receive $4bn of preferred shares and a small amount of warrants "as a fee". There is a $10bn "deductible," i.e., BoA pays the first $10bn in losses, then remaining losses are paid 90% by the government and 10% by BoA.

We are also investing $20bn in preferred equity, with a 8 percent dividend. There will be constraints on executive compensation and BoA will implement a mortgage loan modification program. Essentially, this is the same deal that Citigroup received just before Thanksgiving, known as Citigroup II, which was generous to bank shareholders but not good value for the taxpayer.

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Getting beyond anti-trust and competition law questions, and beyond good and evil, I wonder how Google's rise as a platform through which millions experience the Internet every day means that for much of the world (North America and Western Europe, mostly), Google and the Internet are merging. In other words, what happens when we can't or won't experience the Internet without using Google as a filter, enabler, editor, and source of software (can you tell I have been immersing myself in Nick's work of late?).

In fact, Nick's article in the Atlantic from the summer, "Is Google Making us Stupid?" made me consider this question. The article actually made the case that fundamental features of Web culture are affecting our cognitive habits. It did not directly address the behavior of Google per se. So is Google a proxy for the Internet?

Siva asks: "Why and how did Google increase its share of the search market 7 percent in less than two years? For the past five years or so it seems that MSN, Google, and Yahoo all provide similar search quality and many of the same ancillary services. Why would a person in 2009 stop using Yahoo and start using Google?"

A few speculations:

1. Don't assume that the continuing growth in market share is just, or even mainly, from people switching from other engines to Google's. Use of the Internet (and of search) continues to expand. If a very large percentage of new users choose to use Google, as is likely given that the company is now synonymous with search, then Google's share would keep increasing even if no existing users switched.

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If, as James credibly suggests, Google will likely soon have the power to crush used book stores and exact extortionate prices from libraries who become dependent upon ongoing access to Google's e-book collection, we may ask, Is the company likely to press its advantage to the utmost, here and elsewhere? Or will it hold itself back, adhering to Don't Be Evil?

The story of how "Don't Be Evil" ended up on Google's official list of "10 Things We Know" is told in Planet Google---it began as a guerrilla action on the part of engineers who were concerned about the influx of MBAs into the company. Once it became a publicly visible part of the company culture, it became a permanent fixture that will be hard to remove, should the company's executive leadership ever wish to do so----unless, that is, they want to announce, "Hi, don't mind us---we're just taking care of some preliminary business before we go on to do evil!"

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As long as we have these sharp observers of Google in a conversation, please allow me to ask some provocative questions in hope that y'all will enlighten me.

Why is Google so dominant in search? Why and how did Google increase its share of the search market 7 percent in less than two years? For the past five years or so it seems that MSN, Google, and Yahoo all provide similar search quality and many of the same ancillary services. Why would a person in 2009 stop using Yahoo and start using Google? Is it a network effect? Is it cultural power (there is no verb "to Yahoo")? Is it the corona of goodness that emanates from the company? Or is there a clear qualitative difference that I have never seen demonstrated and thus do not believe?

Randall started answering these questions in a previous post, as he did in his book. Hal Varian asserts that Google is winning because it is demonstrably better. Is there evidence of this claim?

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This is a story you would not find in the mainstream press here.

And, if it appeared, there would be a slew of protests. How dare the media imply that Gaza's children are innocent victims? Does not the "anti-Semitic" Times, Post, or Tribune know that those so-called children were not killed by the IDF but by Hamas which put them in harm's way?

But the truth is here, in Ha'aretz. And it bears no resemblance to the propaganda we read in this country.

What would we do if we had to rely on the timid and intimidated American media? Thank God, we have Ha'aretz (and the Europeans).

Read Gideon Levy here.

Here's the poll.

It's difficult to make the case that the first $350 billion bailout of Wall Street -- so-called "TARP I" -- fulfilled its goals, unless one argues that the Street would have imploded without it, which is pretty much what Hank Paulson is saying these days. And since it's impossible to prove a counter-factual, especially when the Treasury was never clear about TARP I's goals to begin with, Paulson may have a point. But the easier and probably more correct argument is that American taxpayers wasted $350 billion. No one knows exactly where it went -- at least two recent reports reveal that the Treasury had no idea -- but we do know the money did not go to small businesses, struggling homeowners, students, or anyone else needing credit, which was the major public justification for the bailout. In all likelihood, on the basis of the skimpy evidence we now have, the money went instead to bank shareholders in the form of dividends; to bank executives, traders, and directors as compensation (directors of major Wall Street banks continued to pull down an average of $350K each in 2008 merely for sitting in on a handful of board meetings at which they obviously didn't oversee very much); to some holders of bank debt; and to platoons of lawyers, accountants, and other financiers who have advised the banks about other places to park the rest of the money in the meantime.

Congress is now about to give the next Treasury secretary an additional $350 billion, as the second tranche of the bailout. One hopes that the new administration will use it better. Some suggested conditions:

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"E.T. is the model for American culture circa 1980," writes David Thomson in his new book Have You Seen ...? "In trying to give identity and a look to his magical creature, sometimes known as Puck, Steven Spielberg followed an old Disney concept: that people love the look of a baby, the wide brow, the clear, pure eye. So he pasted together a baby's face with a photo of Carl Sandburg's eyes, and the mixture of baby and sage was exquisite."

And so, too, was born Google, the alien baby-sage dropped onto Earth with a 300-year plan to help the human race fulfill its destiny or transcend itself or make way for a superior intelligence or something or other.

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How is it that Israelis, as Ethan Bronner reports, are almost universally in favor of the Gaza operation, including the way it's been prosecuted, while government leaders and educated people around the globe, even those disgusted by Hamas missile attacks, condemn the operation, and especially the way it's been prosecuted?

What's so strange, as veteran Haaretz columnist Gideon Levy rails, is that ordinary Israelis know as well as anybody that hundreds of Palestinian civilians, including perhaps 300 children, have been killed or maimed, and yet this horror has not become a significant part of public debate. For a small minority of peace activists, even a few people in the south, the price in blood has seemed much too high for ending random missile attacks. But most will argue, not entirely convincingly, for humanitarian relief--and then spur on the IDF.

Israelis, I hasten to add, are as sickened and frightened by military violence as the rest of the world is, even by their own. They may feel a superficial pleasure in retaliation for the missiles, or a satisfied relief in seeing the IDF perform in a coordinated, disciplined way, but they are not immune to doubts. There were two blockbuster films over the last couple of years, both anti-war films lamenting actions in Lebanon, "Beaufort" and the throat-clenching "Waltz With Bashir." My Palestinian friends will cringe when I say this, but most Israelis think of Israeli soldiers as children, too.

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Randall asks about antitrust issues, and both he and David think there aren’t many, at least in Google’s core search business. I tend to agree, for reasons they’ve laid out. Compared with the lock-in of using Windows and the network effects of a common set of operating system interfaces, web search is a wide open world. Anyone who comes along and offers better search is in a position to grab the lion’s share of the market, the way that Google itself grabbed it in the beginning of the decade. (For the record, I don’t think Microsoft’s deals with Dell and Verizon Wireless are a sign that Microsoft is competing effectively in its search offerings; they’re a sign that Microsoft has enormous piles of money to throw away on bad business decisions.)

The DoJ scrutiny of the Google-Yahoo deal was similarly off-base. The usual antitrust fear is that sellers will collude and raise prices. But the instant a web search company stops providing free search, it’s dead. Faced with this fact of the search marketplace, opponents of the deal argued that the companies would raise their prices to advertisers. That would be plausible, except that Google’s ad-pricing algorithm is based on an auction to potential advertisers; their competition with each other sets the price. And, of course, from an advertiser’s perspective, search ads are just one piece of the online advertising market; if the prices for search ads go up, advertisers will just find another way to annoy web users. There is at least one place where Google needs a good, careful antitrust review, though: Google Book Search

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Israel's blind, crushing, doomed war on Gaza has ended the Jewish people's 65-year-long reprieve from anti-Semitism since the Holocaust, a reprieve that encompassed most of our lifetimes, during which even dedicated Jew-haters bit their tongues.

No more. Amid the cacophony of justified condemnations we hear the strains of an older, creepier chorus. It is not too much to say that Israel has brought this upon itself, but it is also not too much to say that some rather perverse people have wanted and orchestrated it, as well.

I don't mean that strong critics of Israel should quiet down. It's long past time to break the U.S. media's taboo on talking about Israel's blunders as frankly as Israelis themselves famously do. I do mean to say that Israel's conduct of this war would be hideous and heartbreaking enough without the encouragement it's getting not only from its impassioned and sometimes duplicitous defenders but also from from critics who don't know their history and sometimes sound as if they don't really want to know.

And there is a deeper political problem: Like the bloody combatants of the IDF and Hamas and Hezbollah, word warriors on both sides don't see that the odds of winning justice through state violence and through wars of liberation have sunk since World War II. The commentators' blindness is as willful as the commanders'. And as fateful. And not just for Palestinians or Jews. (I discussed this subject for 20 minutes with Brian Lehrer on New York's NPR station last night. Here it is.)

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It's difficult to make the case that the first $350 billion bailout of Wall Street -- so-called "TARP I" -- fulfilled its goals, unless one argues that the Street would have imploded without it, which is pretty much what Hank Paulson is saying these days. And since it's impossible to prove a counter-factual, especially when the Treasury was never clear about TARP I's goals to begin with, Paulson may have a point. But the easier and probably more correct argument is that American taxpayers wasted $350 billion. No one knows exactly where it went -- at least two recent reports reveal that the Treasury had no idea -- but we do know the money did not go to small businesses, struggling homeowners, students, or anyone else needing credit, which was the major public justification for the bailout. In all likelihood, on the basis of the skimpy evidence we now have, the money went instead to bank shareholders in the form of dividends; to bank executives, traders, and directors as compensation (directors of major Wall Street banks continued to pull down an average of $350K each in 2008 merely for sitting in on a handful of board meetings at which they obviously didn't oversee very much); to some holders of bank debt; and to platoons of lawyers, accountants, and other financiers who have advised the banks about other places to park the rest of the money in the meantime.

Congress is now about to give the next Treasury secretary an additional $350 billion, as the second tranche of the bailout. One hopes that the new administration will use it better. Some suggested guidelines:

1. Do not use any of the money to buy stock in -- that is, to "recapitalize" -- the banks. This is a sinkhole of cosmic proportion. Citigroup, to take but one example, has so far received $45 billion of taxpayer cash since early October (along with some $250 billion in taxpayer-supported guarantees from the Fed for junky assets on Citi's balance sheets), and is in far worse financial shape than it was three months ago. Perhaps, someday over the rainbow, these shares in Citi along with Citi's lousy assets will be worth more than taxpayers paid for them. But we're not in Wonderland yet and probably never will be. Giving Citi or any other big bank more taxpayer money is analogous to giving it to Bernard Madoff. It's a giant Ponzi scheme. The money will disappear.

2. Do not use the money to buy the banks' "troubled" assets. This might have made sense a year ago when the proportion of such assets -- which include mortage-backed securities as well as loans to private-equity partnerships that pissed them away -- was relatively small. But these days a huge and growing proportion of bank assets are "troubled." (It's also a huge waste of taxpayer dollars for the Fed to exchange them for Treasury bills.)

3. Prohibit any bank that gets TARP II funds from issuing dividends, purchasing other companies, or paying off creditors.

4. Bar any bank that gets TARP II funds from paying its executives, traders, or directors more than 10 percent of what they received in 2007.

5. Require that any bank getting TARP II funds be reimbursed by its executives, traders, and directors 50 percent of whatever amounts they were compensated in 2005, 2006, 2007, and 2008. This compensation was, after all, based on false premises and fraudulant assertions, and on balance sheets that hid the true extent of these banks' risks and liabilities.

6. Insist that at least 90 percent of the TARP II money be used for new bank loans. If the banks cannot find suitable borrowers, they should return the money.

You may judge these conditions harsh. I think them prudent. They may force a number of big banks to go into chapter 11 bankruptcy, which would not be the end of the world but perhaps the beginning. At least then we'd find out what was on their balance sheets, because they'd have no choice but to sell off some of their junk, even at fire-sale prices (believe me, if the price is low enough, there are investors around the world who will buy them); they'd have to negotiate with their creditors and pay some of them off; many of their CEOs would be fired and directors replaced, which they should have been already; and most of their shareholders would be wiped out, which is unfortunate for them but, hey, they took the risk. In other words, these provisions would force the banks to clean up their balance sheets. This is the only way to get them to start lending again.

Meanwhile, Congress should attach to TARP II -- or to the upcoming stimulus bill -- a small change in the bankruptcy law allowing homeowners to renegotiate their mortgages on their primary residences (as owners of second homes and commercial real estate can already do). The practical effect will be to give homeowners more bargaining leverage with their mortgage banks, and save at least 800,000 homes from foreclosure. Yes, in theory, holders of mortgage-backed securities will take a hit but as a practical matter they've already taken a hit because the securities (and the securities in which they're wrapped) are already deemed to be junk. At the least, this change will put a bit of a damper on the rising number of foreclosures. A home that's occupied by a family paying something on their mortgage is far better than a home that's empty, on which no one is paying anything.

UNHQ HIT

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I don't know whether Prime Minister Ehud Olmert actually, as he claims, told the President of the United States to ignore his own Secretary of State and let him, Olmert, decide how America would vote in the Security Council.

My guess is that it's true. And that SecretaryRice, embarrassed, has no choice but to deny that it happened.

The reason I think it happened is that this kind of thing has gone on for years. Elliot Abrams used his position in the White House to sabotage Bush's policies in favor of those of Ariel Sharon's. Abrams (and a few of the other neocons) made it impossible for Rice or her predecessor Colin Powell to play the honest broker role. Every time either one was close to a breakthrough, Abrams made sure it never happened.

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Take a look at the NYT photo of Bernard Madoff arriving at court to hear a Federal judge uphold a lower-court decision that he may stay in his splendid apartment while out on $10 million bail.

Why wasn't Madoff jailed in the first place? This Propublica piece gives a legal answer. Surprise: the system is rigged for white collar crooks.

It's his triumphant smile that interests me. Most Madoff photos display that same smile of controlled geniality. He knows all the angles. He knows how the game is played, that is, rigged. This is the smile of a man who knows. He knows the game. He knows you and he knows me. When he was ahead of the game, he basked in the glow of esteem. He relished the chance to grant favors. He prided himself in making his friends richer. When the house of cards collapsed, he was left standing. He believes that he will remain standing. He knows his good fortune has been to live in the right place at the right time to get his name engraved in cornerstones. He has probably worked out a way to feel like a martyr. Losers are schmucks. What he knows is what George W. Bush knows: God bless America, a country where he's going to land on his feet.

Isn't his smile uncanningly similar to Charles Ponzi's?

A lot of Middle East watchers have been stunned by Prime Minister Ehud Olmert's snotty depiction of both Secretary of State Condoleezza Rice and President Bush with regard to UN Security Council Resolution 1860 calling for a ceasefire between Israel and Hamas.

While the US abstained when the vote was taken, Ambassador Zalmay Khalilzad told me today that the US does support the resolution and only had some minor concerns about the timing of the vote.

My colleague and New America Foundation/Middle East Task Force co-director Daniel Levy and UN Dispatch's Mark Goldberg both have more on this, but the exchange below today with Secretary Rice shows that she knows how to manage the optics of this diplomatic tiff with Olmert. Nonetheless, she calls his understanding of events related to the ceasefire resolution "fiction."

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Randall Stross's question about whether the Justice Department needs to probe Google for possible antirust violations is provocative. But the last thing we need in the US now is more government intervention in the economy. It would further destroy growth and jobs. After all, the federal government is pouring tens of billions of taxpayer dollars into Citicorp, AIG and the automobile companies, virtually nationalizing industries in distress, and has taken over Fannie Mae and Freddie Mac, making Uncle Sam the de facto mortgage lender. At this fragile moment, do we really want to decimate Google, a growing, innovative business that has created more than 15,000 jobs and is thriving debt-free?

But Randall's question cannot be ignored, especially not inside the Googleplex. For Google's biggest risk may well be political. Google dropped its proposed partnership with Yahoo last year only because the company was warned that it was hours away from facing Justice Department antitrust action. Google wisely walked away.

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Nicholas Carr sees growing similarities between Google and Microsoft, and at first glance, it does seem plausible to describe both companies as wielding control of the "economic chokepoint of the prevailing computing model of their day." But the more one looks at the nature of their power, the less similar they seem. I'm going to make the argument that Google's customers have played a far more direct role in Google's success than Microsoft's, and that greatly complicates a discussion of possible ways to loosen Google's control of the "chokepoint."

Microsoft's domination of personal computer software has always revolved around distribution deals with intermediaries, hardware vendors---and that continues to this day (how else to explain unwanted Vista's quite respectable sales?). It was those relationships with vendors, built from its operating system business, that permitted Microsoft to get easy distribution for its Office package, and which was priced well below the competition. It also was able to use its intimate knowledge---and, upon occasion, undocumented API calls---to make its applications work with Windows in ways the competition could not.

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Harold Meyerson has a nice column in today's WP underscoring the deeply bizarro nature of an economy that, you've noticed, collapsed under the benign gaze of George "It's your money not the government's money" Bush.

By 2007, when Wall Street's profits amounted to an astonishing 40 percent of all American profits, the business of American finance was no longer American business -- providing loans for domestic production, technological innovation, that sort of thing -- but swapping bets and hedges on bets and hedges, all for hefty commissions.

Save for devising more ways for Americans to go into debt, Wall Street had basically decoupled itself from the economy in which Americans live and work.

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James Grimmelman compares Google to Sauron. I'm flabbergasted. I had always thought that Google was the Ringbearer and that Mordor was where Gates and Ballmer hung out.

Was I misinformed? Or am I just confused? If it's the latter, I have a decent excuse. After all, even though Google and Microsoft have very different public personae, it's getting harder and harder to tell them apart as businesses. Both built their empires through the same strategy: gaining control of the economic chokepoint of the prevailing computing model of their day.

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To me, Bill Moyers in the conscience of American journalism. He's a combination of Ed Murrow and IF Stone. A soft-spoken crusader.

Unlike Murrow or Stone, Moyers really knows how power works. In his twenties, he was LBJ's top aide, resigning over the Vietnam war and Johnson's slip into paranoia.

He went on to become American journalism's best. He is also fearless, as you will see from his commentary about Gaza. Israeli policies are the third rail of our politics: criticize them at your own risk.

Virtually no major figure in media does -- except privately where, with few exceptions, they all do.

Moyers, on the other hand, does not confine his critique to dinner parties. He understands that as a public figure, the words that matter are those he says publicly.

Watch him, listen to him, or read him on Gaza and thank God at least one major media figure is not afraid to speak out.

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The Wall Street Journal is sometimes an amazing window into the bizarre, callous viewpoint of the corporate overlords of the economy. I don't mean the editorial page-- those folks are just cranky ideologues -- but the bloodless professional economic analysis of the news pages. Take this story, Behind Grim Jobs Data, a Potentially Hopeful Sign

There may have been a silver lining for the economy in the horrific December job losses reported Friday by the Labor Department. Companies are cutting back so aggressively that they actually might be increasing their productivity even in the face of a wrenching economic shock...businesses appear to have squeezed more out of the workers they kept on staff, increasing business productivity...

i.e. The remaining workers not only saw large numbers of their collegues fired, they are having to do a lot of the work of those laid off.  And that's good news!

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Max Blumenthal writes that, at a rally outside the Israeli UN Mission Jan. 11, "Sen. Chuck Schumer highlighted Israel's supposed humanitarian methods of warfare by pointing to its text messaging of certain Gaza Strip residents urging them to vacate their homes before Israeli forces bombed them. 'What other country would do that?'"

The U. S., for one. According to the National Museum of the U. S. Air Force, the U. S. dropped millions of leaflets over North Vietnam during Operation Rolling Thunder of 1965-68, in which Americans flew over 300,000 sorties, dropping more than one-and-a-half times as many bombs as in the entire Pacific theater during all of WW II. Among other things, the leaflets "warned civilians to stay away from military installations." (You can buy a sample leaflet from eBay for a little more than $40, including postage.) In 2002-03, the U. S. also dropped such leaflets over Iraq during 2002-03.

Russia, for another, during the first Chechen war. Leaflets, that is, not text messages.

The insistence that Israel has the cleanest hands in history is a bit much--even if you believe that Israel's Gaza war is just (which I do not). Grievously, Hamas is not the only repository of holy war rhetoric in the Middle East. Consider this letter from the parents of an IDF soldier killed by friendly fire to the members of the tank crew who fired on the building where he was taking refuge:

"It was not you who hit Yoni!

"Yoni died for the Sanctification of G-d's Name at the time that G-d decided his time on earth had reached its end. You were the pure angels who had to carry this out.

"We find comfort in the fact that your pure hands struck at him, and not the defiled hands of our wicked enemy - for Yoni could not have been felled by any impure hand."

It's TARP II time and it could be almost as much fun (for the banks) as TARP I. Tough guy Barney Frank is insisting that at least $40 billion of the money in TARP II go to help homeowners. The only problem is that most of the plans on the table for "helping homeowners" actually send checks to banks.

The basic deal is that the government will pay banks above market value for their mortgages so that they will allow homeowners to stay in their homes without foreclosing. While the banks will still take a loss, the government will split the tab in exchange for the banks not foreclosing. Effectively, the banks are taking the homeowners hostage in order to extract taxpayer dollars.

But, we don't have to give in to hostage-takers.

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I posted yesterday about Al Franken showing up with Norm Coleman at a solidarity with Israel rally in the Twin Cities. I thought it odd, to say the least.

That led me to check on other "solidarity" demonstrations in other cities. And I was surprised.

They have taken place in virtually every major city with a significant Jewish population. But hardly anyone is showing up. In New York City, on Sunday, 8,000 (and that is the estimate from the organizers) came out. 8000! In New York, pro-Israel rallies tend to draw hundreds of thousands. And that was the biggest rally in the country.

What does it mean? Is the Jewish community turning on Israel?

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It’s telling that Randall started off the discussion by talking about the lag time between turning his finalized manuscript in to the publisher and seeing it in print. It’s a common problem in writing about computer technology; everything you want to say might go stale before you get the words out. It’s not a coincidence that Planet Google quotes so heavily from blogs, the new first responders of technology journalism. Nor is it a coincidence that the first three good books on Google — Planet Google, David’s The Google Story, and John Battelle’s The Search — were all written by journalists and are structured as thoughtful accumulations of individual pieces of reportage. Individual plot strands — like the Microsoft-Yahoo! deal Randall fretted about — may go out of date, but others remain relevant and interesting.

What I was most struck by in Planet Google was the strong sense of contingency. It’s easy to attribute to Google a single, overarching master plan. (The company’s own messianic sense of mission certainly doesn’t help matters, either.) Each new product seems like another brick in a carefully planned wall, and leads to fairly predictable debates over the good and the evil that walls can be used for. But Planet Google is a good reminder of how remarkably aimless Google can be.

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Speaking in southern Israel today, Prime Minister Ehud Olmert revealed details of a call he apparently placed to President Bush which led to the US changing its vote on U.N. Security Council Resolution 1860 calling for a ceasefire in Gaza and boasting how he had "shamed" the US secretary of state and laid down the law with the president (full report below). AIPAC has also slammed the Bush administration for not vetoing U.N. SCR 1860, as MJ noted earlier.

The first thing to say is that a ceasefire is vital and the U.N. resolution if it helps deliver an end to the violence, rocket-fire and the human suffering, the opening of the blockade on Gaza, and the prevention of weapon smuggling, then it is an important contribution worthy of support. Secondly, Secretary Rice would do best to respond to this act of chutzpah by using her remaining week in office to actually get that resolution implemented and deliver a meaningful ceasefire package - she can still do it and go out on a higher note than having been "Colin Powell"-ed by her own president at the U.N. and dissed by a foreign leader. But the real point is this: what Olmert said is more than just mind-boggling chutzpah - it is deeply irresponsible, insulting and will be a boomerang for Israel. Here's the full quote and report:

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Actually, not everyone is silent. Some of us are quite vocal (lot of good it does!). But what about the others?

It's simple really.

Human beings are not silent in the face of the death of children.

They are silent in the face of the death of some children .

The same people who can weep over the deaths of kids in Darfur or Bosnia or Hiroshima or Warsaw, can ignore the deaths of kids in Gaza by saying, "well, they were put there by Hamas." Or "it is just too complicated."

But, at bottom, most don't care about these kids because they are Palestinian kids.

As someone who knows Jewish history, this indifference to the death of certain kinds of babies doesn't surprise me.

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Letting go of a book manuscript is hard. It's especially hard when the book's principal subject is a company whose every twitch is widely regarded as newsworthy and it feels as if at any moment a news story will break that will render entire chunks of the book instantly obsolete. For Planet Google, I held on just as long as possible, far beyond what was reasonable to ask of my publisher. In June, when the last window for very, very, very final editing would close, I was still futzing over such things as whether Google would purchase Digg or Microsoft would revive negotiations with Yahoo.

Boy, that was pretty pointless. Today, we stare across a bleak economic landscape, with a global economy that has seized up, scary unemployment numbers, worries that a severe recession could become still worse, and our attention fixed hopefully on Inauguration Day. Back in September, after my fingers had been pried off of the manuscript, the landscape changed. In the week separating Lehman Brothers bankruptcy and Planet Google's arrival at bookstores, no Google story broke and nothing about Google's narrative had changed in any obvious way. But the context had...

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Randall Stross is with us for this week's TPMCafe Book Club, where we'll be discussing his latest book Planet Google: One Company's Audacious Plan To Organize Everything We Know. The book takes us inside perhaps the most innovative, successful, and controversial company of the 'Internet Age'. Where is Google leading us, how much do they know about us and how much do we really have a say in the matter?

Randall also writes the Digital Domain column for The New York Times and is a professor of business at San Jose State University.

He'll be joined by a panel of specialists and critics who've all weighed on the dynamic role Google plays in the world of information technology. Nicholas Carr is the author of a recent Atlantic cover article "Is Google Making Us Stupid?" and the bestselling book The Big Switch: Rewiring the World From Edison to Google (out in paperback this coming week). James Grimmelmann is an associate professor at New York Law School and a former resident fellow with the Information Society Project at Yale Law School, specializing in copyright, intellectual property, and internet law. Siva Vaidhyanathan is an associate professor of media studies and law at the University of Virginia, currently working on a book about Google, and maintaining the web site www.googlizationofeverything.com. David Vise won a Pulitzer Prize as a business reporter for the Washington Post, and is the author of The Google Story: Inside The Hottest Business, Media and Technology Success of Our Time.

Join us.

Back on January 2, the Treasury Department announced something called the Targeted Investment Program. I missed this at the time, along with (according to a quick search - thank you Google Reader!) all of the economics blogs that I read. The press release admitted that this was a program announced after the fact to cover the second Citigroup bailout (the first was under the Capital Purchase Program, the main bank recapitalization plan). In essence, the program says that if Treasury thinks a financial institution is at risk of a loss of confidence, Treasury can invest in it under any terms they want. This is very similar to the Systemically Significant Failing Institutions Program, also announced after the fact (in November) to cover the second AIG bailout, which reads almost identically, except instead of talking about a "loss of confidence" it takes about the "disorderly failure" of a systemically important institution.

This isn't a power grab by Treasury - they already had this power under the EESA (the main bailout bill passed in October, commonly known as TARP). And I happen to agree that if a systemically significant institution - the kind that whose failure would have a major impact on countless other institutions - is going to fail, it should be bailed out. However, I think these programs have two major failings.

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Roger Cohen asks the right questions about how Barack Obama ought to address a Middle East that lands with a thud on his plate next week:

Does regarding the Middle East almost exclusively through the prism of the war on terror make sense? Does turning a blind eye to the Israeli settlements in the West Bank that frustrate a two-state solution, and the Israeli blockade of Gaza that radicalizes its population, not undermine U.S. interest in bolstering moderate Palestinian sentiment?

Should policy not be directed toward reconciling a Palestinian movement now split between Fatah and Hamas, without which no final-status peace will be possible? Beyond their terrorist wings, in their broad grass-roots political movements, what elements of Hamas and Hezbollah can be coaxed toward the mainstream?...

Asking these questions does not alter America's commitment to Israel's security within its pre-1967 borders, which is and should be unwavering. It does not change the unacceptability of Hamas rockets or the fact the Hamas Charter is vile. But it would signal that the damaging Bush-era consensus that Israel can do no wrong is to be challenged.

Teasingly, Cohen starts by noting that all the players mentioned as putative Mideast advisers are Jews. That's an attention-getter but it's not really the point. The point is that Messrs. Ross, Steinberg, Kurtzer, and Indyk have been around the Israel-Palestine block so many times, with so little to show for it, they do not inspire hope of the tough love that Israel (and the Palestinians) need. The point is that because Israel threw caution to the hot desert winds while Bush broadcast the green light (to make up for having denied Israel use of Iraqi airspace when they wanted to bomb Iran's nuclear site last summer?), tough love is more urgent than ever (and it's been urgent for a very long time).

I still hope for the best, including: start dismantling West Bank settlements; hold back on military aid; bring in the Arab League behind the 2002 Saudi peace proposal. But if Obama were to appoint a economics team of men and women who were gung-ho deregulators during the last eight years, it would also be right to say: Wha?

This is crazy.

Older Jews often ask, "is it good for the Jews." They ask it about everything. Is it good for the Jews that tall Jew David Gregory took over Meet The Press after the death of a beloved Irish Catholic? Is it good for the Jews that Madonna studies Kabbala and cheats on Guy Ritchie with A-rod at the same time?

Well, here's one that is decidedly NOT good for the Jews. Franken and Coleman, both Jewish, come together in support of Israel's Gaza war.

They hate each other. They agree on nothing. One is a Mideast hawk. One is a dove.

But when it comes to Israel and its Gaza war, they join hands and sing Kumbaya, I mean Hava Nagila. .

Here's another Jewish expression: what will the gentiles say. I'll tell you what they will say about this (I asked some). They say it is appalling, offensive and incomprehensible.

I love Franken but he clearly does not get this issue. Nor does he understand that to the Minnesotans who worked to elect him, ethnic chauvinism is about as anachronistic as only electing white men President. Who does he think he is? Rudy Boschwitz?

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Now that neo-con Field Marshall William von Kristol's hideous New York Times column has persisted a week past its first anniversary, I've decided to stop reading the whole op-ed page. It isn't Kristol alone who has profaned that bare, ruined choir of punditry, most of which already deserved him the day he arrived. Even the estimable Paul Krugman, the intrepid Nicholas Kristoff, the impassioned Frank Rich, and Gail "Hah-hah" Collins can't keep the page a "must read" or vital civic reference point. For technological as well as moral reasons, its time has come and gone.

Its problem certainly wasn't that Kristol is conservative. The page needed a smart, honorable conservative or two to keep its liberals honest. But it offered the nutrition-less if beguiling David Brooks, that pop-sociological sophist and sometime neo-conservative savant whose intellectual usury I've pinned and whose evolution I predicted last fall, and the tactical maunderings of Kristol, whose phony populist banter has lived down to its full promise since he began.

The Times op-ed page's failure to stimulate real political discussion reflects deeper agonies of American Newspaper Hell, especially conglomerate publishers' visionless and technological bottom-lining, which is extinguishing newspapers as centers of civic dialogue.

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George Stephanopoulos tried hard to get Obama to spell out his views on Gaza. Obama dodged specifics but he said enough to give us a window into his thinking.

One, he was utterly evenhanded. Asked if he would repeat his remarks in Israel this summer about Israel having the right to defend itself, Obama said yes. That was it.

But, unlike other politicians, he offered no special love for Israel. He made clear that he is committed to helping Palestinians and Israelis. And he said he will pursue the peace process from day 1. Unlike Bush, McCain and Congressional hawks, he discussed Iran without mentioning Israel. He is worried about the nukes -- and that they would be used against Israel or anyone else -- but he intends to talk to Iran, not rattle his saber on Israel's behalf.

On Gaza specifics, he punts. "We have only one President at a time."

So how come he insists that there is "only one President" when it comes to Gaza but he spoke plenty about Mumbai? Simple.

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Israel is barring independent journalists from Gaza, but The New York Times, relying on Palestinian correspondents there, reports that "Hamas, with training from Iran and Hezbollah, has used the last two years to turn Gaza into a deadly maze of tunnels, booby traps and sophisticated roadside bombs. Weapons are hidden in mosques, schoolyards and civilian houses, and the leadership's war room is a bunker beneath Gaza's largest hospital, Israeli intelligence officials say."

The Times account of how cruelly both sides are fighting underscores how badly we need reporting like George Orwell's from the bloody Spanish Civil War in 1936. Orwell joined and fought for the democratic left against the fascist Franco, but he quickly found something his leftist readers didn't want to know: Franco wasn't the only evil enemy of freedom in Spain.

If a new Orwell informs us that Israel, although it's hideously cruel and wrong, isn't the only evil enemy of freedom in Gaza, will anyone want to know?

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