Open Thread: Are we at a point of no return?

Paul Krugman outline's the healthcare proposal now on the table and questions why the Blue Dog Democrats are opposing it. An Incoherent Truth . He states the case:

Right now the fate of health care reform seems to rest in the hands of relatively conservative Democrats — mainly members of the Blue Dog Coalition, created in 1995. And you might be tempted to say that President Obama needs to give those Democrats what they want.

But he can’t — because the Blue Dogs aren’t making sense.

The Time for Protests Is Now: The First 100 Days Are Over. What Next?

hat tip TPM. Photo by Jeff Malet/maletphoto.com


Last December I reviewed  a new book,  Obama’s Challenge: American’s Economic Crisis and the Power of a Transformative Presidency. I began with a question:

In his new book, Robert Kuttner has provided a context for the current discussion on Barack Obama’s economic team, men like Timothy Geithner who will be leaving his post as head of the NY Federal Reserve to become Treasury Secretary. What will be their influence in determining the direction of the new Administration? Events have moved rapidly since he wrote the book (released this past labor day), but it is still timely and prescient.

In today's Huffington Post, Kuttner provides a tentative answer, Obama's First 100 Days: What's a Presidency For? He concludes that so  far President Obama seems to have ducked and compromised. His title refers to the days following Pres. Kennedy's assassination when Johnson's aides warned him not to push too hard for landmark civil rights laws and he replied, "Hell, what's the presidency for?"  Even on the question of Health Reform Kuttner feels that Obama may still pull back and accomodate corporate interests by dropping public health insurance from package.

A fair assessment of the situation we face. The question remains what to do about it. Kuttner points to a key weakness in the situation and provides an implicit answer.

A second systemic obstacle, for now anyway, is the absence of a popular movement to put wind at a progressive president's back. Among the logical candidates, the labor movement is weakened by the same economic crisis, divided internally, and it sorely needs Obama's good will for everything from the Employee Free Choice Act to the auto rescue. The web of grassroots activists who came together to elect Obama is now a website of the Democratic National Committee. MoveOn.org is organizing around issues such as universal health care, but pushes on the president only gingerly. More than anything else, the stance of most progressives is still mainly gratitude.

Now We Know What AIG says, We Still Need To Know The Answer "What The Hell Is the Real Story?"

So, now we know, two thirds of the bail out money which went to AIG between October and the end of December wasn’t intended for AIG at all, but was passed through to others. The list includes Goldman Sachs, Morgan Stanley, Deutsche Bank, Societé Generale, and many others. And, if that wasn’t enough to make you choke on your coffee this morning, there’s the additional fuel of the AIG bonus story. OMG, this is just like totally over the top.

There’s a lot of outrage about this which is kind of being stoked by the media, and there’s some useful commentaries which are dealing with parts of the story. These three from Robert Kuttner Robert Reich and the America’s Future blog are ones to take cognizance of, I think. In Kuttner's view Obama's financial team is leading him to destruction. Reich raises his voice against the corruption, and so do the folks over at Progressive Breakfast in their morning release.
The outrage is directed at the upfront particulars, the bonuses and the pass-through laundering of bail-out funds. I think though there is a picture beginning to emerge of the structure of the Paulson-Bernanke bailout which raises a whole range of other issues. The banks continue to insist that their assets will come good with a rebound in the economy, and therefore their current pricing structure should be preserved.Yves Smith provided a major service this morning over at Naked Capitalism when she made available Bruce Krasting's discussion of the AIG bonusses and Tyler Durden's guest post on bailout spotting.

Robert Kuttner Releases Purported Memos Between the President and Raum Emanuel

The lead story in today's Huffington Post, is a post by  Robert Kuttner White House Confidential, in which he releases to memos, supposedly exchanged between President Obama and Rahm Emanuel regarding the failure of the Adminsitrations policie's dealing with the banking crisis. Taken together they are a damning critique of a policy that threatens to simultaneously sink the economy further and weaken the political clout of the Adminstration.