This afternoon Josh described some of the calculations involved in choosing the direction of the bailout process.  When considering the validity of the current Treasury plan, compared to a receivership (or managed implosion) of the broken banks and AIG, the viability of the world economy over the next 5 or 10 years seems to be the most critical metric.  So, there are about three options on the table:  do nothing (the GOP plan, approximately), over-value and buy out toxic assets (the once and future Treasury plan), and start breaking down the banks and AIG (the fairness/realist/pragmatist plan).

In terms of the best overall outcome, the bank-breaking plan provides the fairest, cleanest solution over the long term.  Risk takers - individuals and institutions - who took bad risks lose money.  Taxpayers don't buy toxic assets at inflated prices.  Institutions which created this cascading series of problems dissolve.  Overall, these are good outcomes - this is how the regulated free market is supposed to work.

But that's not the metric they're working with at Treasury.  They're focused on minimizing the down-side.  The worldwide economy is in precipitous decline.  There is a real possibility of unrecoverable failures in banking and securities, failures which would take more than a generation to overcome.  You posited a 1/6 chance of economic catastrophe if we follow the biting-the-bullet, managed-restructuring approach.  And maybe there's a 50/50 chance of collapse if we do nothing.  So what is the full-on-catastrophe risk associated with the toxic-asset-buyback approach?  I'm guessing it's less than 1 in 6 - maybe 1 in 10 - and that looks pretty great, whether you're at a bank or the Fed or the Oval Office.

And that's the really, really hard choice to make, politically.  If you start breaking down the banks, you appeal to populists, pragmatists, and free-marketeers of all stripes.  It's a good solution on paper and it's fair to everyone involved.  But it poses an unacceptable risk of destroying the world economy.  This is what I think is happening between Obama, Geithner, and everyone else who gets a say in the solution.  They're willing to get beaten up on this, day after day, week after week, because their job is a lot bigger than looking good on television.

I'm all for extending the olive branch, as President Obama (!!) has done this past week with House and Senate Republicans.  Good for him, taking input from all sides, following through on his campaign promises to be inclusive.  He's probably done more across-the-aisle bridge building in the last two weeks than W did in two terms.

But if you build a bridge, and the guys on the other side - who insisted they wanted a bridge - burn it down, you might do things differently next time.  The President and his congressional allies made a variety of concessions to Republicans and got, it appears, nothing in return.  This is not shocking, but it should influence the next round of the legislative process, which is traditionally adversarial.  When you have a majority in both houses, and the presidency, and broad popular support, you don't have to start with concessions.

I trust these guys, the new administration, to have a deep understanding and a long-term legislative plan.  Perhaps it's the partisan, out-of-power mindset I share with many Democrats that wants President Obama to flex his legislative muscles, since that's what GOP strategists and officials seem to understand best.

Maybe this week we'll see some policy speeches, perhaps away from DC, selling the Liberal elements of the stimulus plan, explaining the inclusive and bi-partisan elements, and setting the stage for the next round of legislation.

McCain asserted today that Obama robocalls are distorting his position on immigration, a point he tried to make during the last debate.  Could somebody follow up with The Maverick and find out what that policy is, exactly?  Is it the pre-primary, immigration reform with a path to citizenship and enforcement?  Or is it the base-pleasing, primary season, "enforce the laws and seal the border" position, disowning his own legislation?

He actually chuckled at McCain's "Did we hear the cost of that fine?" idiocy.

I think many of the commentators tonight are focusing on the individual exchanges and missing a big picture win for Obama tonight.
In many ways McCain, like it or not, is nearly an incumbent candidate, almost like running as a sitting VP.  He is tied, fairly and inextricably, to almost every major policy implemented by Bush.  Even his more mavericky positions against the tax cuts and torture have been watered down to "I agree with the President."
People don't want another four years and, despite his use of the word "change,"  that's very nearly McCain's pitch.  Tonight, McCain, faced with an actual opponent, couldn't bring himself to parrot the pretty, bipartisan, I'm-the-changiest BS that he delivers on the stump.  He brought the full range of conservative positions and Obama, for the most part, brought liberal or moderate positions.
So there were no big tactical wins, no major gaffes, and very little memorable.  But on the optics, the 50,000-foot view, Obama nailed it.  He stood at that podium, took questions calmly but decisively, contesting every lie and distortion from McCain, interrupting when necessary.  He looked like a real President.  And for the middle slice of the electorate who don't agree with McCain on policy and can't stand Bush, trust in Obama is the last bridge to cross.
Obama doesn't have to beat McCain with witticisms and superior rhetoric.  That's nice for us chattering elitists, but it won't win over the undecided middle.  What will win them over is the big-picture messages.  Obama projected confidence, wisdom, determination, and a tiny dose of righteous anger in unpacking McCain's distortions.
Americans want to vote for someone new, but they're afraid and need a gut-level reassurance that this guy is real and up to the task.  Seeing the two men on the same stage as equals, by itself, starts to break down the myths of the war hero and the empty suit.  McCain, in reality, today, is not so heroic, and Obama is not so empty.  As the voters' idea of these two men approaches reality, Obama will benefit and McCain will lose.

Jake Tapper excerpts some of Joe Biden's remarks made on Friday, including "he is a good man" and "I admire John McCain."  Except for "Let's Drill", that's the whole McCain pitch to voters - he's a good, admirable man.
<p>
Please stop making this argument for the GOP and stick with attacking their hypocrisy, changing positions, and flawed policy prescriptions.  Thanks.

On WBUR's On Point, Mark Halperin said, twice, that McCain just gave up his biggest, most effective argument against Barack Obama.  This seemed out of character, as Halperin regularly spins his analysis to favor McCain.

But today he quoted a conservative commentator, saying "McCain turned his sledgehammer into a rubber mallet."  Halperin explained that McCain's "lack of experience" attack on Obama has become nearly useless, giving McCain almost no chance of winning the election. He's made similar comments in a Steve Benen CBS News articles published Friday (though he was listed as a "traditional Republican voice").  Please give Mr. Halperin a warm welcome to the reality-based community.

I was listening to Joe Trippi on NPR this morning talking about not taking Sarah Palin too lightly.  He made some good points about image and perceptions and it forced me to re-assess the McCain strategy.  We've seen some new, lofty phrases from McCain in the past couple of weeks.  The newest ad is called "Love."  Has any Republican candidate, for anything, ever run an ad titled "Love"?  In "Love" we hear that McCain returned from war to pursue "public service" - perhaps chasing Cindy Hensley was a civics project.  Sure, they can't quite give up on smacking Obama, saying "beautiful words can't make our lives better", but the message is shifting.

One of the volunteer pages on the McCain site asks that you sign up for "A Cause Greater Than Self".  Tell me this isn't lifted out of the Obama playbook (or any progressive campaign):

My friends, each and every one of us has a duty to serve a cause greater than our own self-interest.
I hope you will take a moment to learn more about these important causes and consider getting involved helping others either here or with the thousands of other organizations serving the greater cause.

Since when is conservatism about somthing greater than self-interest?  That's easy, it's not, but with the selection of Sarah Palin, McCain is beginning the process of appropriating all of the youth/change/reform themes that Obama has been hitting.

The new McCain message, which the RNC will amplify, is that McCain (+Palin) is just like Obama (+Biden), only with more experience and grit.  All of the GOP surrogates have been talking about "bucking the party" this weekend.  Bush and Cheney have a reasonable excuse to be absent from the convention, a personal and political gift for McCain.  The Right's noisemakers have finally acknowledged the demise of the Republican party's credibility (aka "brand") and everyone is spinning the virtues of centrism and bipartisanship.  This is a huge pack of lies, but that's the problem. 

Knocking down each individual lie is time consuming and boring.  For example,

Palin said she was against earmarks, but requested $200 million in earmarks this year. 

That's true, but it's also boring, dry, and forgettable.  What is the alternative?  Something shorter, sharper, and absolutely not sexist.  For example,

John McCain and Sarah Palin are lying about their record of reform and independance.

That's a soundbite we can believe in.  It's much sharper, keeps the focus on McCain, but doesn't let Palin off the hook.  When the press questions this statement, Dems can explain the details (ideally starting and ending with "McCain and Palin are lying").  If the press, or McCain, or the right-wing noise factory want to rebut this charge, they have to switch to wordy, boring, forgettable defenses.

The McCain/Palin campaign is about to turn into an even bigger circus of lies and hypocrisy.  There's no reason to think the press point this out, so the Obama campaign has to do it.  They have the capacity - we've seen Obama and Biden take the fight to the GOP.  They have some very talented surrogates, starting with Bill and Hillary, who can make this case many times in many places, but they'll have to start now.

Atrios and others have expressed some concern about Sarah Palin, but she is the Clarence Thomas of VP picks.   There's no way she's the most qualified candidate, but she generates a lot of media hype, which is McCain's forté.  Unlike better-known women of the GOP, Palin won't upstage McCain or threaten his position as Decider in Chief.

People are worried about charges of sexism and unflattering images of Biden attacking a pretty young woman, but this is easily remedied.  Sure, Biden isn't the most tightly controlled speaker, but now he's on the best-run,  Democratic campaign in a generation and he'll have lots of help.  Notice Biden dropped his favorite exclamation - literally! - in Springfield - from his convention vocabulary.

1. Ignore Sarah Palin
Don't attack Sarah Palin at all.  3rd party groups can go after her on corruption, but that's not too important.  Since she isn't a large figure on the national scene, there isn't much of an image to tear down.  Attacking her would give her more stature than ignoring her.Surrogates can describe her policy positions without attacking her personally.  She's a classic conservative on virtually every issue.  And we can all agree that her selection as VP is historic - it's about time Republicans crossed this barrier 24 years after Geraldine Ferraro was the Democratic VP candidate.  Kudos to Sarah, and shame on the GOP for taking so long.

2. Pummel McCain
The only McCain/Palin meme coming from Democrats should be that her selection means Republicans don't really believe experience in DC is all that relevant.  Everything else should be an assault on McCain's positions, his argument with himself, his temper, his bad decisions, his flawed policy proposals, and so on.  Stop calling him a hero.  Every sentence that begins "We honor John McCain's service" should end with "unfit to be President."

When Joe Biden debates Sarah Palin, he should be polite and respectful to her, and attack McCain like a rabid mongoose.  He can do it.  Look at his convention speech, which had elements of charm and grace, followed by serious, thoughtful denunciations of McMaverick.

3. Pummel the GOP
This is not just the leadership, which has been inept, corrupt, and cancerous all at once, but the policies and underlying philosophy.  Obama started down this path in his acceptance speech, talking about owning the failure of the "ownership society."  That should be a constant theme.

That's it.  Don't create sympathy and legitimacy for Sarah Palin by attacking her, just focus on McCain.

Sarah Palin is the Clarence Thomas of VP picks.  There's no way she's the most qualified candidate, but she generates a lot of media hype, which is McCain's forté.  Unlike better-known women of the GOP, Palin won't upstage McCain or threaten his position as Decider in Chief.

People are worried about charges of sexism and unflattering images of Biden attacking a pretty young woman, but this is easily remedied.  Sure, Biden isn't the most tightly controlled speaker, but now he's on the best-run,  Democratic campaign in a generation and he'll have lots of help.  Notice Biden dropped his favorite exclamation - literally! - in Springfield - from his convention vocabulary.

1. Ignore Sarah Palin
Don't attack Sarah Palin at all.  3rd party groups can go after her on corruption, but that's not too important.  Since she isn't a large figure on the national scene, there isn't much of an image to tear down.  Attacking her would give her more stature than ignoring her.Surrogates can describe her policy positions without attacking her personally.  She's a classic conservative on virtually every issue.  And we can all agree that her selection as VP is historic - it's about time Republicans crossed this barrier 24 years after Geraldine Ferraro was the Democratic VP candidate.  Kudos to Sarah, and shame on the GOP for taking so long.

2. Pummel McCain
The only McCain/Palin meme coming from Democrats should be that her selection means Republicans don't really believe experience in DC is all that relevant.  Everything else should be an assault on McCain's positions, his argument with himself, his temper, his bad decisions, his flawed policy proposals, and so on.  Stop calling him a hero.  Every sentence that begins "We honor John McCain's service" should end with "unfit to be President."

When Joe Biden debates Sarah Palin, he should be polite and respectful to her, and attack McCain like a rabid mongoose.  He can do it.  Look at his convention speech, which had elements of charm and grace, followed by serious, thoughtful denunciations of McMaverick.

3. Pummel the GOP
This is not just the leadership, which has been inept, corrupt, and cancerous all at once, but the policies and underlying philosophy.  Obama started down this path in his acceptance speech, talking about owning the failure of the "ownership society."  That should be a constant theme.

That's it.  Don't create sympathy and legitimacy for Sarah Palin by attacking her, just focus on McCain.

Sarah Palin is the Clarence Thomas of VP picks.  There's no way she's the most qualified candidate, but she generates a lot of media hype, which is McCain's forté.  Unlike better-known women of the GOP, Palin won't upstage McCain or threaten his position as Decider in Chief.

People are worried about charges of sexism and unflattering images of Biden attacking a pretty young woman, but this is easily remedied.  Sure, Biden isn't the most tightly controlled speaker, but now he's on the best-run,  Democratic campaign in a generation and he'll have lots of help.  Notice Biden dropped his favorite exclamation - literally! - in Springfield - from his convention vocabulary.

1. Ignore Sarah Palin
Don't attack Sarah Palin at all.  3rd party groups can go after her on corruption, but that's not too important.  Since she isn't a large figure on the national scene, there isn't much of an image to tear down.  Attacking her would give her more stature than ignoring her.Surrogates can describe her policy positions without attacking her personally.  She's a classic conservative on virtually every issue.  And we can all agree that her selection as VP is historic - it's about time Republicans crossed this barrier 24 years after Geraldine Ferraro was the Democratic VP candidate.  Kudos to Sarah, and shame on the GOP for taking so long.

2. Pummel McCain
The only McCain/Palin meme coming from Democrats should be that her selection means Republicans don't really believe experience in DC is all that relevant.  Everything else should be an assault on McCain's positions, his argument with himself, his temper, his bad decisions, his flawed policy proposals, and so on.  Stop calling him a hero.  Every sentence that begins "We honor John McCain's service" should end with "unfit to be President."

When Joe Biden debates Sarah Palin, he should be polite and respectful to her, and attack McCain like a rabid mongoose.  He can do it.  Look at his convention speech, which had elements of charm and grace, followed by serious, thoughtful denunciations of McMaverick.

3. Pummel the GOP
This is not just the leadership, which has been inept, corrupt, and cancerous all at once, but the policies and underlying philosophy.  Obama started down this path in his acceptance speech, talking about owning the failure of the "ownership society."  That should be a constant theme.

That's it.  Don't create sympathy and legitimacy for Sarah Palin by attacking her, just focus on McCain.

"Angry heckler" may be redundant, but watch the whole video to see how worked up this gentleman was in Cleveland yesterday.

I'm so happy to see Senator McCain pushing more ill-considered policies.  Resuming his gas-tax-holiday promotion, McCain raises some questions about how and why this would work.

There is no excess supply of gasoline - we buy all the gas that's available for sale.  There is little incentive for competition between gas retailers, which is why gas prices vary so little between filling stations.  Sure, labor costs, real-estate values, local/state regulations, and local/state taxes play a role.  But once you account for those disparities, there's not much left - prices are pretty flat.

So eliminating the federal gas tax may change the cost of gas for people selling gas, but it may not lower prices at the pump.  With oil prices fluctuating every day, and worldwide demand continuing to increase, prices will be hard to predict.  Maybe the gas retailers, small and large, will take the tax holiday as a little more margin for themselves, or maybe the oil refiners will raise their gas prices a bit (market conditions?) to offset the gas-tax discount.

Let's say we get a gas tax holiday for six months.  Will it affect prices at all?  Probably not.  And that would be fairly horrible for all concerned.  Gas tax holiday proponents would be ridiculed, oil companies would be demonized, and the federal government would be out several billion dollars in revenue. 

But our government, makers and enforcers of laws, some-time arbiter of the market, could lock in the savings.  The feds - in this case, Congress - could set gas prices.  Leaving aside whether or not this is a good idea, it is an implicit element in this gas tax holiday theory.  How else could one guarantee savings for the average gas consumer?  Should we have a gas tax holiday and just hope for lower gas prices?  Last time I checked, hope is not a plan. 

Surely Senator McCain has more behind his gas tax holiday proposal than meaningless pandering, right?  He's a man of substance/character/integrity/steel/heroism/profanity/etc, his gas tax holiday must be legit.

So, in the language of the proprietor, when will the campaign press start asking McCain if he is in favor of price controls on gasoline to insure savings for consumers?  How would those price controls be enforced?  And why does he want to bring Soviet-style, command-economy policies to the United States - didn't we win the Cold War?

David Kurtz raises an important point in his Buffoonery Alert post today - Obama needs to get tougher and louder in refuting this sort of crap from Rep. Steve King and future Steve Kings. It's actually a great opportunity for Obama, or Hilary, whoever is bold enough to take it on.

We don't have enough discourse about what is and isn't a good strategy to combat Al Qaeda and its spin-offs. We talk about this at a high level, but mostly in terms of the wisdom or incompetence of the Bush administration. That's an important discussion, but it limits the scope of the conversation.

Congressman King's stupidity is a great opportunity to talk about how many people don't understand the problem we face with Al Qaeda and terrorism, that terrorists and their sympathizers don't really care about American domestic politics. They care about Israel and Lebanon and Syria and Iraq and Afghanistan and Chechnya - they care about our foreign policy with respect to Muslim nations and regions.

More importantly, Steve King and his message must be thoroughly discredited. Where did Steve King get this rich insight into the collective mind of anti-American, Islamic fundamentalists? Is there any truth to what he's saying? It's reasonable, for example, to think that most people around the world will be happy to see the end of the Bush administration, but not Al Qaeda. They will be disappointed, as their chief enemy steps off the world stage. They'll be disappointed that the man who talked about a crusade against Muslims, whose supporters regularly go much further in insulting Islam and conflating Muslims with terrorists, is finally going away.

The people who will be rejoicing at an Obama inauguration are the moderates, the otherwise pro-Western Muslims whose voices have been drowned out by violent radicals.

There is a real case to be made for a new foreign policy, and what it will mean, and how the world will react. And finally, why do we, as American voters, care if "The radical Islamists, the al-Qaida" declare victory? Are we so weak and feeble that a declaration of victory by some, any, all terrorists means something? Is that the same as an actual Al Qaeda victory? Let's say that happens - what then? What does Steve King think he's talking about? The bad men will be happy? And we should be scared?

It's complete garbage, and Obama should take the opportunity to set the record straight.

I understand this tactic of bringing up Obama's middle name is childish, but calling it "slimy" or "underhanded" or "insulting" seems awfully close to whining about the mean Republicans using the man's actual name. I'm an Obama supporter and I volunteer for the campaign as often as I can, but I'm not happy about the responses to the use of "Hussein".

Of course they should refute charges of anti-semiticism and other nonsense, but please, let's not make the Senator a victim. Do we really want our candidate to be asking, implicitly or explicitly, that people not say his middle name? Isn't that pathetic and absurd?

I'd like to hear some language about being a nation of immigrants, that we are not so easily frightened by a person with an unusual name.