Senate Passes Health Reform

The Senate today passed health care reform legislation by a 60-39 vote. It’s a historic achievement, the farthest health care reform has ever come. Progressives should cheer today’s news.

Yet because the legislative sausage-making occurred under the bright lights of the 24-hour news cycle and incessant blogorrhea, the sense of achievement is tempered by disillusionment — even disgust — with a political system that seems designed to chip away at bold reform. Horse-trading and bickering are hallmarks of the legislative process, but we experienced something different with this bill: because of its momentousness, and because of the media ecosystem, more Americans than ever saw more of the process than ever. And what they saw was a politics that seems horribly ill-suited to solving the public problems that face us today.

Even President Obama, who has shown remarkable faith in messy pluralism throughout the entire ordeal, indicated his frustration with the system, telling PBS:

I mean, if you look historically back in the ’50s, the ’60s, the ’70s, the ’80s – even when there was sharp political disagreements, when the Democrats were in control for example and Ronald Reagan was president – you didn’t see even routine items subject to the 60-vote rule.

So I think that if this pattern continues, you’re going to see an inability on the part of America to deal with big problems in a very competitive world, and other countries are going to start running circles around us. We’re going to have to return to some sense that governance is more important than politics inside the Senate. We’re not there right now.

Meanwhile, that up-close view of lawmaking no doubt contributed to the backlash that has emerged in the netroots over the bill. Dissent was not unexpected, but mutiny? That’s what the president faces on the left. On Firedoglake, one the left’s leading blogs, Jon Walker called the bill’s passage “a loss for the country.” Jane Hamsher accused President Obama of throwing progressives under the bus, calling his deal-making “the move of a deeply cynical politician who believes in nothing but shameless manipulation for political convenience.”

The netroots’ disdain for the president seems at odds with the messianic powers they ascribe to him. Apparently, all the president need do is give a speech or sweet-talk a legislator or two and he can get the left whatever it wants. You make laws, however, with the system you have, not the one you wish you had. Navigate the process — the only one we have — is what the president did. The wonder is that this legislation passed at all. Facing a fractious Democratic caucus, a phalanx of industry stakeholders, and — the biggest factor of them all — a Republican Party that has placed its bet on sinking this presidency, the president is close to notching, in the words of The New Republic‘s Jonathan Chait, “the most significant American legislative triumph in at least four decades.”

It’s not over yet. Anguished negotiations in conference will follow. Continued pressure from Republicans and interest groups, the conservative base and progressive blogs, will try to erode the resolve of congressional Democrats. The Republicans in Congress are a hopeless cause — a fact that, more than any other political consideration, should dominate progressive thinking about tactics and strategy. Seek to improve the bill in conference by all means. But attacking the bill with talking points that could easily come from Republicans (A “deeply cynical politician”? Really?) does the progressive cause no good.

Last year’s campaign showed Obama to be a really good closer. An even bigger test now awaits.

In Florida, the GOP at War with Itself

Greetings from Miami, where the weather is warm and the politics are positively scorching. Down in these parts, the talk has centered on the struggles of Gov. Charlie Crist in the Republican primary for the Senate against former House Speaker Marco Rubio, who is challenging him from the right.

Rubio was once considered a long shot. But a recent Rasmussen poll has pegged the race as a dead heat. As Ed Kilgore noted in these pages, Rubio has become a star in the national conservative movement, winning the endorsements of the right’s true believers eager to bag themselves another RINO in the moderate Crist.

Now comes word that Crist has lost the endorsement of two key backers:

Miami Republican Reps. Lincoln and Mario Diaz-Balart have pulled their endorsement of Gov. Charlie Crist for the U.S. Senate, dealing his campaign a significant blow in South Florida’s Hispanic community.

When asked by the Miami Herald the reason for pulling their support, Lincoln Diaz-Balart was cryptic, saying Crist “left us no alternative and he knows why.” The Herald reports that it might have something to do with Crist passing over a prosecutor recommended for a North Florida county judgeship by Lincoln Diaz-Balart.

Whatever the reason, it’s the latest round of bad news for Crist, whose moderate Republicanism has run afoul of a state party that — like the national conservative movement — has the urge to purge.

But that’s not all! Florida GOP Chairman Jim Greer has been facing calls for his resignation from state party leaders who have accused him of mismanaging the state GOP’s finances and mishandling its political operations. As Crist’s handpicked GOP chairman, Greer has been widely seen as devoting much of his efforts to Crist’s campaign. In fact, Greer had sought to snuff out Rubio’s primary challenge early on, a move that certainly did not endear him to the party’s restive base.

(Now, before you go and think that Greer is a reasonable, level-headed Republican being targeted by an inflamed rank-and-file, think again. Remember when President Obama gave that televised speech to students across the country at the beginning of the school year and caused a right-wing meltdown? Here was Greer’s Glenn Beck-ian response: “As the father of four children, I am absolutely appalled that taxpayer dollars are being used to spread President Obama’s socialist ideology.”)

Greer has responded by sending out a letter accusing his critics of being “bent on the destruction of the Republican Party.” He has also agreed to hold a special meeting to rescind his chairmanship, as his critics had demanded — but claimed in his letter that the rules do not allow for such a move at the special meeting.

One thing seems certain: with the well-funded Crist and his GOP chairman now fighting for their political lives, the Florida GOP civil war is only going to get uglier. After weeks of watching progressives duke it out over health care, it’s nice to be distracted by the internecine wars on the other side for a change.

Parker Griffith Can Change Parties, But Not History

As a Democrat from the South, the news that freshman Rep. Parker Griffith of Alabama was switching parties brought back bad memories from the 1990s, when a goodly number of elected officials from the region who had been Democrats for no particular reason other than political convenience became Republicans for no particular reason other than political convenience.

But the exodus of party-switchers back then was both natural and healthy, painful as it was. Jay Cost of RealClearPolitics seems to think, or hope, that Griffith’s flip-flop could touch off another wave of party-switching. I have two reactions to that: (a) if, as appears entirely possible, Griffith loses his seat anyway, then I doubt he’s going to be a major role model for others; and (b) Griffith is from the rare southern seat that is conservative but has never elected a Republican congressman. In other words, it’s like the venues of the party-switchers of the 1990s, when the realignment of the parties was reaching its peak. Most moderate-to-conservative Democrats in the South are from areas where genuine Democrats-In-Name-Only left the party years ago. The remainders are a pretty hardy bunch, even if more progressive Democrats don’t like their voting records.

But whether or not Parker Griffith is the wave of the future or the north end of a south-bound brontosaurus, one thing ought to be clear: his protestations that he had to change parties because of some shocking new ideological development in the Democratic Party is total, absolute, conscious b.s. Griffith’s not some crusty old long-time incumbent whose party changed without him; he was first elected in 2008, when Barack Obama was running on a platform promising climate change and health care reform legislation, and going along with George W. Bush’s decision to rescue the financial industry. Nancy Pelosi, whom Griffith is now attacking, wasn’t any less liberal then that she is today. Sure, he needs to play catch-up with his new party-mates in shrieking about socialism and the destruction of the U.S. Constitution, but nobody should be under any illusion that anything has changed since 2008 other than Parker Griffith’s assessment of his re-election prospects.

So however you assess the meaning of this development, nobody in either party should have any particular respect for Griffith–not because he’s a “turncoat,” but because he’s trying to disguise his opportunism as an act of principle, which it is not.

The item is cross-posted at The Democratic Strategist.

Death Panels the “Lie of the Year”

Sarah PalinDick Cheney may have won Human Events‘ “Conservative of the Year” award, but the Right’s more contemporary megastar, Sarah Palin, got her own big end of the year award. She’s the author of PolitiFact’s “Lie of the Year,” via her infamous Facebook post on health reform and “death panels.”

This was indeed an instant classic: completely fabricated, aimed at a particularly important constituency, and applying one of the favorite hallucinations of Palin’s buddies in the Right to Life movement (liberals want to extend their “holocaust” from the unborn to old folks) to the domestic policy issue of the day. And best of all, the lie was distributed not through some clunky and news-cycle-sensitive speech, but through Facebook!

TPM has a nice slide show illustrating how the “death panel” meme pre-developed before Palin invented the term and launched it into the national consciousness.

Obama One Year On

PPI President Will Marshall joined a panel to discuss and assess President Obama’s performance on national security and domestic policy issues at the end of his first year in office.

The event was hosted by the New America Foundation/American Strategy Program and The American Interest.

Essays written by the panelist are featured in the current edition of The American Interest.

This event will run from 12:15pm – 1:45pm EST and will be featured on CSPAN later this week.

Panelist
Walter Russell Mead
Henry A. Kissinger Senior Fellow for U.S. Foreign Policy
Council on Foreign Relations

Richard Perle
Resident Fellow
American Enterprise Institute

G. John Ikenberry (via conference call)
Albert G. Milbank Professor of Politics and International Affairs
Woodrow Wilson School of Public and International Affairs
Princeton University

Steve Clemons
Director, American Strategy Program
New America Foundation
Publisher, The Washington Note

Will Marshall
President
Progressive Policy Institute

Stephen Krasner (via conference call)
Former Director of Policy Planning, US State Department
Graham H. Stuart Professor of International Relations, Stanford University

Ronald Steel
Professor Emeritus of International Affairs
University of Southern California

stage-setting remarks
Adam Garfinkle
Editor
The American Interest

moderator
Steve Coll
President
New America Foundation
Staff Writer, New Yorker

Where’s the Center? More on Polarization and the Parties

Here at P-Fix, the ever-energetic Scott Winship has pivoted from a debate with me and others about the advisability of limiting or killing off the Senate filibuster into an extended and scholarly discussion of the origins and nature of partisan polarization. He’s mainly doing battle with the 2005 book “Off-Center” by Jacob Hacker and Paul Pierson. I have no particular dog in that fight, other than to observe that Hacker and Pierson did usefully draw attention to the perils involved in allowing either party to unilaterally move “the center.”

But while I am not competent to joust with Scott on the proper exegesis of Poole-Rosenthal “scores,” I do find a couple of the assumptions he makes quite troubling.

The first is his understandable but still misleading reliance on self-identification of “liberals, moderates, and conservatives” (or some variation involving intensity) for defining the ideological character of the American electorate. Yes, polls of self-identification on this scale do show a very stable “center-right country” in which conservatives typically outnumber liberals three-to-two or even more. This is how Scott arrives at his fundamental argument that polarized elected officials don’t adequately represent the people who elected them, and also how he somehow concludes that the notable shift of Republican opinion to the right in recent years has made the system more, not less representative (that’s his major refutation of the Hacker-Pierson contention that the GOP has dragged the political center to the right).

Self-identification measurements are always iffy, as is made most evident by the vast gap between the number of voters who call themselves “independents” and the number who actually behave in an independent manner. But the hoary liberal-moderate-conservative scale is particularly influenced by the unpopularity of the “liberal” term, even among many voters who are “liberal” by the normal standards. This is what conservatives have bought with so many years and so many billions of dollars invested in the demonization of “liberalism,” compounded by the very different meanings the term has denoted here and abroad.

The distortion involved in using this term is made evident by many, many surveys that show millions of “non-liberal” voters agreeing with liberal values and policy goals, and by a few efforts to use a different typology. In the latter category, John Halpin and Karl Agne published a study earlier this year that found a significantly different spectrum of ideological self-identification simply by adding two other options — “progressive” and “libertarian” — to the usual three choices. The electorate broke down as 16% progressive, 15% liberal, 29% moderate, 34% conservative, and 2% libertarian — a much more equal distribution than the ancient three-to-two-or-higher advantage for the right.

It’s worth noting as well that the “center-right nation” meme has the perverse effect of holding Democrats to a higher standard of “bipartisanship” than Republicans, since “liberals” obviously have to move further to reach the actual political center than “conservatives.” And indeed, that’s pretty much what Scott suggests.

The second problematic feature of Scott’s analysis is that his data is (unavoidably, since you use what you can get) crucially out of date when it comes to profiling Republicans ideologically. Pre-2006 analyses of Republican elected official ideology may well be useful for a historical debate, but since this whole discussion began with the current partisan gridlock in Congress, the sharp movement of the GOP to the right following its defeat in the last two election cycles is more than a little relevant. To put it simply, the “moderate” wing of the Republican Party, at least in Congress, largely died after 2006 and 2008, partly because many moderates were defeated, and partly because party leaders and activists alike made a collective decision to blame both defeats on insufficient GOP conservatism. Few if any Republican “thinkers” are arguing for greater moderation or bipartisanship; more common are safaris to bag the increasingly rare species of the RINO. And most obviously, as Barack Obama seeks to implement the campaign platform (if not, as in health care, something to the right of his platform) he won on, Republicans in Congress are united against him while Democratic moderate dissenters are sometimes so thick you can’t stir them with a stick. This is not the picture Scott paints from his data of a political system where both parties have equally eschewed “the center.”

Getting back to the original discussion, Scott suggested that reforms to open up primary elections to independents might be a more fruitful approach to ending gridlock than restoring something like majority rule in the Senate. Though I favor open (or at least more open) primaries as a general proposition, the idea that this would have an immediate impact on polarization isn’t terribly compelling. It’s a subject that is complicated by definitions: some states with “closed” primaries allow very late changes in party registration, even on Election Day, which certainly gives independents every opportunity to participate. “Open” primaries range from the “jungle” primaries of Louisiana and Washington, to those in states with no party registration to begin with, to those who allow registered independents to vote in either party’s primary. But if you are looking in this direction for a cure-all, consider that the two most ideological senators, Jim DeMint of South Carolina and Bernie Sanders of Vermont, are both from open primary states. (Meanwhile, Ben Nelson, Joe Lieberman, and Olympia Snowe are products of closed primary states.) And remember, too, that registered “independents” are not always “centrists.”

In the immediate future, there are only two apparent routes to ending gridlock. One would be curbing the filibuster, either through intrapartisan pressure among Democrats to support cloture votes as a matter of course, or a change in the Senate rules. The other would be the revival of interest among Republicans in governing, either because they win elections and are forced to do so, or they lose so badly that today’s rightward stampede is reversed.

Conservative Crocodile Tears About “Corporatism”

TNR published a piece I did the other day examining the ideological underpinnings of the left/center split in the Democratic Party over the propriety of a universal health care system based on regulated and subsidized private health insurers. I suggested there was a burgeoning, if questionably workable, tactical alliance between “social-democratic” progressives and some conservatives to derail much of the Obama overall agenda. Then I made this observation:

[O]n a widening range of issues, Obama’s critics to the right say he’s engineering a government takeover of the private sector, while his critics to the left accuse him of promoting a corporate takeover of the public sector. They can’t both be right, of course, and these critics would take the country in completely different directions if given a chance. But the tactical convergence is there if they choose to pursue it.

This statement has drawn considerable comment from people on both the Right and Left, mainly objecting to the argument that Obama’s critics can’t all be right.

Conservative theoretician Reihan Salam, writing for National Review, first argued that there’s not much substantive difference between the “New Democrat” deployment of private-sector entities in public initiatives and that favored by the privatizers of the Right. But then he pirouetted to make common cause with Obama’s critics on the Left:

It is entirely possible for both sets of critics to be correct. The concern from the right isn’t that the Obama approach will literally nationalize for-profit    health insurers. Rather, it is that for-profit health insurers will continue evolving into heavily subsidized firms that function as public utilities, and that seek advantage by gaming the political process. Profits, including profits governed by medical loss ratios, can and will then be cycled into political action, which leads to the anxiety concerning a “corporate takeover of the public sector.”

Salam’s friend Ross Douthat of The New York Times added an “amen” to this argument:

The point is that the more intertwined industry and government become, the harder it is to discern who’s “taking over” whom — and the less it matters, because the taxpayer is taking it on the chin either way.

But do conservatives really oppose this intertwining of industry and government? Rhetorically, yes, operationally — not so much.

Consider the default-drive Republican approach to health care reform, such as it is. It typically begins with federal preemption of state medical malpractice laws and health insurance regulation, the latter intended to produce a national market for private insurance (while also, not coincidentally, eliminating existing state provisions designed to prevent discriminatory practices). But the centerpiece is invariably large federal tax credits, accompanied by killing off the current tax deduction for employer-provided coverage, all designed to massively subsidize the purchase of private health insurance by individuals (with or without, depending on the proposal, any sort of group purchases for high-risk individuals). Another conservative pet rock is federal support for Health Savings Accounts, which encourage healthy people to pay cash for most medical services, perhaps supplemented by (very profitable) private catastrophic insurance policies. And most conservatives, when they aren’t “Medagoguing” Democratic proposals to rein in Medicare costs, favor “voucherizing” Medicare benefits—another gigantic subsidy for private health insurers.

Now some conservatives will privately tell you that all these subsidy-and-deregulation schemes are just an interim “solution” towards that great gettin’ up morning when tax rates can be massively lowered, all the tax credits, vouchers and other subsidies can be eliminated, and the government gets out of the health insurance business entirely. But don’t expect to see that on any campaign manifestos in the foreseeable future. In the meantime, Republicans generally support huge government subsidies to corporations without any public-spirited regulatory concessions in return.

Do anti-“corporatist” progressives really think they can make common cause with conservatives, beyond deep-sixing Obama’s agenda in the short term? Well, sorta kinda. Salon’s Glenn Greenwald, who rejected my “incompatibility” argument about left and right critics of “corporatism” as strongly as did Salam, is smart and honest enough to acknowledge there’s no real common ground with conventional conservatives or Republican pols. He instead offers a vision of an “outsider” coalition that includes anti-corporatist progressives and Tea Party types. This is, of course, the age-old “populist” dream (most famously articulated by Tom Frank inWhat’s the Matter With Kansas?) of a progressive takeover of the Democratic Party that attracts millions of current GOP voters (or nonvoters) who don’t share the economic interests of the Republican Party or the conservative movement but have seen little difference between the two parties.

All I can say is: Good luck with that, Glenn. Short of a complete and immediate revolution within one or both parties, complete with blood purges and electoral chaos, it’s hard to see any vehicle for a left-right “populist” alliance other than a Lou Dobbs presidential run. Barring that unlikely convergence, wrecking Obama’s “corporate” agenda would produce little more on the horizon than a return to the kind of governance we enjoyed during the Bush years, or maybe a bit worse given the current savage trajectory of the GOP.

Part of my intention in the original essay was to suggest that pro-Obama Democrats take seriously the views of intra-party rebels on health care and other issues, instead of insulting them as impractical and childish or obsessed with meaningless totems like the “public option” (which in the anti-corporatist context isn’t meaningless at all). But said rebels really do need to think through where they are going, and where they would take Democrats and the progressive coalition.

Meanwhile, conservatives need to be far less pious about their alleged objections to “corporatism.” Cheap rhetoric aside, their own agenda (when it’s not just preserving the status quo) is largely corporatism with any clear and enforceable public purpose cast aside whenever possible.

This item is cross-posted at The New Republic.

The Improbable Vote

So: at about one o’clock this morning, the United States Senate, or at least the 60 members of its Democratic Caucus, passed the long-awaited cloture vote to proceed to a final consideration of a health care reform bill.

As one who has had an irrational faith that the Senate would get to this point somehow or other, I have to say it was still an improbable accomplishment.

As recently as a few days ago, Joe Lieberman looked all but unreachable for this vote. Then Ben Nelson looked unreachable, even as Republicans Olympia Snowe and Susan Collins made it clear they had decided that nearly a year of begging from the White House and Senate Democrats wasn’t enough to overcome the right-wing heat they were experiencing. Then Democrats like Sherrod Brown and Bernie Sanders came under intense pressure to hold up the bill from progressives determined to derail the latest deal and force a recourse to a 2010 reconciliation strategy.

More fundamentally, a 60-vote Democratic Caucus was an exceptionally improbable achievement. It took (a) a near-sweep by Democrats of winnable seats in 2008; (b) a complex deal to keep arch-apostate Lieberman in the Caucus; (c) a favorable resolution of the near-tie vote in Minnesota after months of GOP legal obstruction; and (d) swift action by the Massachusetts legislature to provide for an interim Senator to replace the late Ted Kennedy.

It all came down to a one a.m. vote after a rare Washington snow storm, with Republicans openly praying that someone (i.e., the infirm Robert Byrd of West Virginia) wouldn’t be physically present.

The current conservative caterwauling about a “rushed” vote is pretty hilarious, given the endless delays undertaken by Senate Democrats all summer and early fall in an effort to engage Republicans, the open and notorious GOP strategy of running out the clock (reminiscent of the Bush strategy for securing the presidency nine years ago), and the front-page status of every detail of the legislation since last spring. Does anyone doubt for a moment that if Democrats had gone along and delayed final Senate action until after the holidays, the same people whining about their spoiled Christmas would be demanding the legislation be put off until after the 2010 elections? Indeed, that’s what we will in fact be hearing in January when a House-Senate conference committee completes its work.

That conference committee, and the House and Senate votes necessary to ratify its report, is far from a slam dunk, given House Democratic resentment of Senate deal-making, and substantive disputes on issues ranging from the public option to abortion. But the struggle to get to 60 votes in the Senate makes the endgame of health care reform look manageable by contrast.

This item is cross-posted at The Democratic Strategist.

Pakistan Just Ain’t That Easy

It seems almost elementary that the governments of Pakistan and the U.S. both have a vested interest in extending Islamabad’s authority over the whole of its country, a point David Ignatius makes today:

Here’s the cold, hard truth: U.S. success in Afghanistan depends on Pakistan gaining sovereignty over the tribal belt. If the insurgents can continue to maintain their havens in North Waziristan and other tribal areas, then President Obama’s surge of troops in Afghanistan will fail. It’s that simple.

Extending the Pakistani government’s writ is certainly a core element to any hope of securing Afghanistan. A safe base of operation across the border in Pakistan would allow al Qaeda’s senior leadership room to incubate in hopes of re-spreading its wings in a larger Taliban-protected region. Points for identifying the problem, but it’s not that simple.

But just a handful of pages away from Ignatius is a reminder of just how difficult that challenge will be:

Pakistan’s Supreme Court nullified on Wednesday a controversial deal that had given President Asif Ali Zardari and thousands of other government officials amnesty from prosecution on corruption charges, a decision likely to further weaken Zardari’s shaky hold on power.

The ruling could open the door to additional legal challenges against Zardari. Although he still has immunity from prosecution under the constitution, opponents plan to contest that by arguing that Zardari is technically ineligible for the presidency. …

But Zardari’s ability to make decisions about the level of Pakistani cooperation with the United States has been compromised by his struggle to simply hold on to his job — a task likely to be made more difficult by the court ruling.

There are essentially three legs of power in the Pakistani government — the military and intelligence services are the largest center of gravity, followed by the courts and then the civilian leadership. Rivalries between all three are intense to say the least, a dissection of which could take up an entire encyclopedic volume. And even though the military isn’t mentioned in the WaPo’s article, it almost goes without saying that the generals would be fine if Zardari fell from power.

The point is that as long as these communities’ main focus is a struggle for power, the White House will never get them to pay primary attention to internal security. And even if you could, each power base has reasons (some better than others) to turn a blind eye to the Taliban lodged in Pakistan’s hinterland.

The situation isn’t hopeless…yet. Despite long-standing suspicions of civilian President Zardari’s corruption (hey, the guy wasn’t called “Mr. 10 Percent” for nothing), he is the legitimately elected leader and was allowed to return to Pakistan — with his late-wife Benazir Bhutto — in an amnesty deal reached with ex-President Pervez Musharraf. Therefore, the U.S. should stand by Pakistan’s nascent democracy and support Zardari, without making him look like an American puppet.

Then the U.S. government should work on aligning the military under Pakistan’s civilian leadership. Congress tried this by conditioning aid on just such a goal in October. Guess what? It didn’t go over so well with Pakistan’s generals. Back to the drawing board.

Breaking the Glass-Steagall Myth

Bank of America Tower, Seattle, WAWord going around Washington this week is that Sens. John McCain (R-AZ) and Maria Cantwell (D-WA) are pushing to reinstate Glass-Steagall:

McCain and Cantwell, a Washington Democrat, join other lawmakers in Congress proposing to reinstate the 1933 law, repealed a decade ago by the Gramm-Leach-Bliley Act that led to a rise in conglomerates including Citigroup Inc., JPMorgan Chase & Co. and Bank of America Corp. active in retail banking, insurance and proprietary trading. Legislation to reinstate the ban was introduced today in the House.

While this move is a well-meaning attempt to rein in the financial sector, it doesn’t address the issues that caused last fall’s crisis.

Glass-Steagall was aimed at separating “boring” retail banking (the Bailey Building and Loan Association, for example) from “risky” investment bankers (Gordon Gekko). It was eventually repealed, as U.S. banks felt it put them at a disadvantage in the global marketplace against European “universal” banks, such as Deutsche Bank, Credit Suisse, and HSBC.

At the time there was concern that repealing Glass-Steagall would create banks that were systematically dangerous. In hindsight, that concern would seem to be born out — but it isn’t. After all, the three major bank collapses that precipitated the crisis were Bear Stearns, Merrill Lynch, and Lehman Brothers. All three were obviously Too Big Too Fail, but all three would have been unaffected by a reinstatement of Glass-Steagall — none of them is a retail bank (this is why you never saw Merrill or Lehman ATMs).

Rather than focusing on micromanaging bank structure, and stifling entrepreneurship in the financial sector, the Senators would be better served by evaluating different options to limit the size of Too Big Too Fail banks. A smarter idea would be to extend the retail bank deposits cap idea to total bank assets. Currently, no bank can have more than 10 percent of total national retail deposits (Bank of America got a waiver for the 2007 purchase of Chicagoland’s LaSalle bank and now has 12.2 percent of national deposits). Peter Boone and Simon Johnson suggest applying this simple principle to total bank liabilities. They recommend a limit of 2 percent of GDP, which is in line with the $300 billion that Felix Salmon has been recommending since March. Importantly, it’s also in line with the de facto $100 billion threshold that bank regulators are using now.

This way the government isn’t running banks and bankers can pursue the capitalist impulse that drives our economy. But with a cap on liabilities, the decisions of bankers cannot threaten our economy like they have in the past.

Has Political Polarization Been One-Sided? Part Two

To read the first part of this post, click here.

Defining the Center

Let’s examine Hacker and Pierson’s definition of “the center.” When they compare activists to independents, changes in the distance from independents may be due to growing extremism among activists. However, the distance may grow without activists changing their views at all if independents change their views. So saying Republican activists drifted further away from the center than Democratic activists may misstate what occurred; independents may simply have drifted toward Democratic activists over time without activists drifting anywhere. It’s also possible that Republican activists have grown more extreme, which has pushed independents closer to Democratic activists’ (unchanged) views.

Furthermore, secular changes in ideology over time can move people from the independent category into Democratic and Republican camps and vice versa, making it difficult to say whether the changes identified indicate that activists (or independents) are changing their views, or that it’s just flows into or out of the parties that is changing. If one of the parties looks more or less extreme, it could simply be that people who would have called themselves independent in the past are now identifying with one of the parties, making the leftover independents look somewhat more extreme in the opposite direction.

Rather than compare activists to independents, why not simply measure how far they are from the midpoint of the ideology scale? When one does so, one obtains the graph below.

Trends in Activist Ideology (ideology midpoint)

By this measure, which avoids all of the problems with using independents as a reference point, the change in extremism among Democratic activists looks exactly the same as the trend for Republican activists. Once again, Republican activists look more extreme in any year, and this time (not shown) this remains the case when one looks at the unsmoothed data points.

A Better Way to Measure Ideology

There is also a problem with Hacker and Pierson’s measure of ideology. If we want to know whether party activists have become ideologically more extreme over time, we should use as pure a measure of ideology as possible. The measure Hacker and Pierson use, however, conflates ideology with tolerance and empathy because it is based on questions asking how warm or cold one feels toward liberals and conservatives. It could be that Democratic activists are simply more tolerant of their opponents than Republican activists rather than being more centrist. One can feel warmly toward a group without identifying oneself with it.

A better measure of changing ideology among party activists would be to look directly at changes in self-identified ideology. The NES asks respondents to place themselves on a 7-point scale ranging from extremely liberal to extremely conservative. Here, then, is a final chart showing trends for activists in each party, with ideology measured as the distance of activists from “4” – the midpoint of the seven-point scale. The actual data points are connected and the smoothed trends are shown as black dashed lines. It should be noted that this chart is based on even smaller sample sizes than Hacker and Pierson’s, so I show the margin of error for the data points as dashed vertical lines. I also omit off-year elections to make the chart less noisy.

Trends in Activist Ideology (self-ID)
This chart confirms that Republican activists more often than not have been more extreme than Democratic activists, though the two groups were statistically tied in 1972, 1976, 1992, and 2004. There is a clear trend toward greater extremism among Republican activists. Among Democratic activists, there was little consistency between 1972 and 1998, but they appear to have moved to the center in 2000 and 2002 before jumping up to the level of Republican extremism in 2004.

Finally, there is the claim by Hacker and Pierson that Democratic activists are more centrist than other Democrats. In my results, this was not true in 2004 whether one used the thermometer index or the self-identified seven-point ideology measure and was not true in 2002 unless one used the seven-point measure (which Hacker and Pierson did not). Regardless, none of the differences between the two groups – in my results or theirs – are statistically significant due to the small sample sizes.

In sum, Republican activists have generally been at least as extreme as Democratic activists and often more so, though not in 2004, which makes the Republican pattern seem less worrisome. Furthermore, while in 2002 it looked like Republican extremism had increased and Democrats had become more moderate, by 2004 Democrats had completely caught up to Republicans. Republican and Democratic activists were equally far from the center in 1972 and in 2004, so the shift was of the same magnitude for both. And there’s no reliable evidence that Democratic activists are more moderate than other Democrats.

The Bush administration and the Republican Congress may have used various tactics in order to pass an agenda that lacked strong support. But they were not “off center” if that phrase is taken to mean that their agenda was outside the bounds of what the public supported. Or more specifically, where Republicans succeeded, their agenda was not out of bounds. Hacker and Pierson downplayed the extent to which Republicans had to reach out to the center in what they did or did not favor. Education spending, for instance, increased more under Bush than under Clinton, in a nod to “compassionate conservatism.” Furthermore, where Republicans truly moved off center, they failed, as with Social Security privatization. And of course, 2006 and 2008 happened.

The views expressed in this piece do not necessarily reflect those of the Progressive Policy Institute.

Will Liberals Really Kill Health Reform?

The never-ending story of health care reform took another turn for the weird this week.

It began with liberals working themselves into a lather over Sen. Joe Lieberman’s threat to scuttle reform unless the Medicare buy-in was dropped. Now Howard Dean, liberal paladin and former Chairman of the Democratic National Committee, is campaigning openly to kill a Democratic president’s top domestic priority. Vermont’s Sen. Bernie Sanders, the Senate’s sole self-avowed social democrat, warns the White House that he is not a certain vote for health reform, though it’s unlikely that he would cast a vote with the Republicans to filibuster it either.

Liberals believe, perhaps with some justification, that Sen. Lieberman has forced changes in the bill simply to spite them. But it has to be said that Lieberman, at least, makes no pretense of being a party loyalist. He crossed the political Rubicon by appearing at the Republican National Convention in 2008 to endorse his friend John McCain. His decision to caucus with the Democrats is a marriage of convenience, so charges of infidelity seem beside the point.

No good purpose is served by the left’s fixation on Lieberman as a kind of progressive Judas. It’s creepily reminiscent of the orchestrated venom directed against the fictional turncoat “Goldstein” in George Orwell’s 1984.

What prompted Dean’s scream on health reform was the decision by Senate leaders, backed by the White House, to drop both the public option and the Medicare buy-in in pursuit of the 60 votes needed for passage. In a characteristically self-righteous outburst in today’s Washington Post, Dean helpfully accused his fellow Democrats of selling out to the health insurance industry.

The rifts among Democrats, coupled with monolithic Republican opposition to the Senate bill, have fed growing public doubts about health reform. According to a new NBC-Wall Street Journal poll, more Americans oppose the legislation than favor it (44-41 percent). Other surveys show that voters are worried that they’ll actually wind up paying more for health care after reform.

The President’s Principles

Now, liberals are understandably angry that Senate filibuster rules effectively give a handful of moderates inordinate power to block progressive measures backed by a majority of Senate Democrats. That’s triggered an important debate – featured here on P-Fix over whether it’s time for progressives to change those rules to either circumscribe or abolish the filibuster.

But it’s also true that liberals should not have expected that the Senate bill include a public option or the provision allowing people as young as 55 to buy health coverage from Medicare. The Senate Finance Committee bill did not include them and Obama promised neither during the campaign. In fact, the president has explicitly ruled out a single-payer approach, instead echoing PPI’s call for a distinctly American approach to universal health care, a public-private hybrid based on the principle of “shared responsibility.”

Many single-payer advocates, however, apparently view the president’s stance as purely tactical; surely, deep down, he’s with them. They see the public option and the buy-in as incremental steps toward a “Medicare for all” approach that ultimately will displace private health insurance.

Obama, however, has been admirably consistent about his top-line goals: expand coverage through public subsidies and mandates; prevent insurance companies from denying coverage or dropping people who get sick; drive medicine toward higher quality and lower costs; and do it all in a way that adds nothing to the deficit. The Senate bill, though riddled with imperfections and compromises, does an acceptable job of advancing those goals and moving the process forward to the final stage: a conference to reconcile House and Senate versions of reform.

So liberals have a choice. They can torpedo a bill backed by a Democratic president and nearly all Senate Democrats, a bill that would cover 30 million uninsured Americans, discipline health insurance companies, and begin the challenging task of containing health care cost growth, in favor of alternatives that stand no chance at all of passage. Or they can pocket the undoubted progressive gains embedded in the House and Senate bills, help their party pass landmark legislation, and keep working to build support in the country for their vision of health reform. Congress meets every year and there will be ample opportunities to refine whatever emerges from today’s legislative scrum.

Despite the public infighting and fratricidal rending of garments, congressional Democrats are only one vote away from an historic victory on health care reform. So progressives should stop obsessing over Joe Lieberman, turn off Howard Dean, and help Barack Obama bring home the prize.

Has Political Polarization Really Been One-Sided?

OK, to review the debate so far: I wrote a post suggesting progressives might want to think twice before jettisoning the filibuster. Ed thought twice and said, yup, still want to get rid of it. Ezra did the same. I wrote another post saying, oh well whatever nevermind and tried to shift the subject to polarization being the real problem. I said I’d follow up about whether increasing polarization has been a one-sided affair. Crickets chirped. All hell broke loose on the health care reform front. And here we are.

So….one-sided polarization….Ever since Jacob Hacker and Paul Pierson’s Off Center, all good progressives know that the growing political polarization has been one-sided, with Republicans pulling public policy “off center” through various nefarious means. Right?

Well….yes and no. Hacker and Pierson argued that, as of 2005, Republican activists and legislators had grown more conservative, but Democratic activists and legislators had not grown more liberal (and had even moved to the right themselves in some regards). Along with this shift, Republicans had developed effective strategies to move public policy further rightward than the typical voter preferred.

Since the rightward shift of Republicans occurred during a period in which Hacker and Pierson showed the distribution of self-identified ideology had not changed, the implication was that the electorate was being deprived of the more progressive policies that it desired. But a closer look at their data and analyses shows that while the increase in polarization among legislators has occurred disproportionately among Republicans, the evidence hints that this is because it proceeded from a Nixon-era Democratic Congress that was well to the left of the electorate.

Rather than refuting the idea that policy reflects the preferences of voters in the middle (the “median voter theorem”), as Hacker and Pierson claimed, the evidence actually bolsters this view. Correcting their claims is important if progressives are to govern effectively. Republicans did not simply pull public policy to the right of where Americans preferred, and now that Democrats are back in control of Congress, progressives should not assume that the median voter is leftier than she really is.

Why Off Center Is Off

To argue their case, Hacker and Pierson turned to scores created by Keith Poole and Howard Rosenthal that put members of Congress past and present on a common scale measuring ideological position. Hacker and Pierson report that the polarization of Congress between the early 1970s and the early 2000s was almost entirely due to growing extremism among Republicans. Democratic legislators had not moved nearly as far from the center. Because of the increasing conservatism of Republicans, Congress was, in the early 2000s, far to the right of the median voter, who had not grown more conservative over time. But Hacker and Pierson’s account is flawed.

Consider the Senate.* Poole and Rosenthal’s scores, using every vote by every member of every Congress through the 108th Congress (which ran from 2003 to 2004), indicate that the “center” as of 2003-04 was typified by northeastern Republicans such as Lincoln Chafee, then-Independent Jim Jeffords, and William Cohen; Arlen Specter (now, of course, a Democrat); and by red-state Democrats such as Ben Nelson and John Breaux. In 1971-72, the median senator had a score of -0.056, equivalent to Ben Nelson’s score in 2003-04. By 2003-04, the median senator had a score of 0.061, equivalent to Arlen Specter in 2003-04.

This small change in the median of the Senate as a whole only hints at the fact that, as Hacker and Pierson claim, Republican senators did move farther ideologically than Democratic senators. The evidence that Hacker and Pierson presented describes how the median in one year compared with then-recent senators’ scores. In the early 1970s, according to Hacker and Pierson, the median Republican senator lay “significantly to the left of current GOP maverick John McCain of Arizona—around where conservative Democrat Zell Miller of Georgia stood” [where the references to McCain and Miller are to their 2003-04 scores, italics in the original]. The median Republican senator’s score then “doubled” by the early 2000s so that it sat “just shy of the ultraconservative position of Senator Rick Santorum.”

These descriptions do not quite reflect what the Poole-Rosenthal scores show. The median Republican senator’s score in 1971-72 was equidistant between McCain in 2003-04 and Miller in 2003-04, not closer to Miller, and it was just as close to McCain as the median Republican senator’s score in 2003-04 was to Santorum.

This claim also raises a technical issue. The Poole-Rosenthal scores are not ratio scales with a meaningful zero point. The distance between 0.2 and 0.4 is supposed to be the same as that between 1.2 and 1.4, but 1.2 is not “six times as conservative” as 0.2, because a score of 0 does not indicate the complete absence of conservatism. The zero point is completely arbitrary. The doubling from 0.2 to 0.4 would become an increase of just 50 percent if we added 0.2 to all of the scores (from 0.4 to 0.6). We cannot know whether Republican senators grew twice as conservative between the early 1970s and the early 2000s. Indeed, the phrase “twice as conservative” has no obvious meaning.

More to the point, Hacker and Pierson’s interpretation of these results is an even bigger problem. Rather than the Republican Party drifting ever rightward (the whole time increasingly “off center”), if the Democratic Party was “off center” in the early 1970s, then the movement among Republicans could be interpreted as a restoration of an equilibrium reflecting voter preferences. This is exactly what appears to have happened.

First of all, the medians for the 2003-04 Senate were 0.379 and -0.381 for Republicans and Democrats – essentially identical. That means that after this great rightward shift by Republicans, the parties were equally “extreme” by historical standards. Furthermore, the median Democratic senator in 1971-72 wasn’t much less extreme than the median senator from either party in 2003-04.

Second, at least in terms of self-identification, the ideological distribution of Americans was unchanged over this period, with roughly twice as many people calling themselves conservative as calling themselves liberal.**

Taking these facts together – a rightward shift by Republican legislators, an end state where Democrats and Republicans are equally “extreme”, and an ideological distribution among voters that was static over the period (and right-leaning) – the conclusion that best fits is that the Democratic Congress of 1971-72 was off center rather than the Republican Congress of 2003-04. The median Republican became more extreme over time, but that was because Congress became more representative of the electorate, not less. The story on the House side is much the same, except that the median Republican was a bit more “extreme” than the median Democrat by 2003-04 (although no more extreme than the median Democrat was in 1971-72).

Comparing the Activists

Hacker and Pierson also argue that Republican activists grew more extreme while Democratic activists became less so (becoming even less extreme than Democrats in general), but these claims are also problematic. Hacker and Pierson began by defining an activist as someone who self-identifies as a Democrat or a Republican and who participated in three out of five election-related activities asked about in the American National Election Studies. They measured ideology using a combination of two “thermometer” items – one of which asks respondents how warm or cold they feel toward liberals and one inquiring about conservatives. These scales range from 0 (cold) to 97 (hot). (The scale ends at 97 rather than 100 because in some years, the NES used codes 98 and 99 as missing value codes.) The liberal score is subtracted from 97 (so that high numbers then signify cold feelings) and then added to the conservative score. This number is divided by two, 0.5 is added to it, and the decimal is dropped. The resulting measure ranges from 0 (extremely warm toward liberals and extremely cold toward conservatives) to 97 (extremely cold toward liberals and extremely warm toward conservatives).

To determine how far activists drift from the center, they compared the activist scores on this index to the scores for independent voters. The distance from independents is expressed in percentage terms (e.g., 10 percent more conservative or liberal). Hacker and Pierson plotted the average distance from independents for Republican and Democratic activists and then “smoothed” the trends by imposing curves to describe them. The result is a graph that I replicated, more or less:

Trends in Activist Ideology (smoothed)

The graph shows that Republican activists were more extreme than Democratic activists to begin with, that they became more conservative over time, and that after becoming more liberal, Democratic activists tacked back toward the center. The first important thing to note about this graph is how much the nice, smooth lines depend on fitting the data points to a quadratic equation. The original data – without the smoothing – looks much messier:

Trends in Activist Ideology (not smoothed)

The upward trend among Republican activists is still readily apparent, but the trend for Democratic activists no longer points toward moderation. The bouncing around is partly due to different turnout patterns in off-year elections, but also a result of statistical noise, as the sample sizes for each group are less than 70 – and as low as 18 – in each year. Furthermore, Republican and Democratic activists are statistically the same distance from the center for much of the period between 1968 and 1992. To illustrate further how deceptive the smoothed trend lines can be, look what happens to them when 2004 data – which was not available when Hacker and Pierson created the graph – is added:

Trends in Activist Ideology (+ 04)

The Republican line hardly changes, but now Democratic activists appear to grow steadily more liberal. It still appears as though Republican activists drifted from the center more than Democratic activists did, and Republican activists look more extreme in all years.

OK, take a breather. Tomorrow I’ll wrap up with some revealing evidence about how Hacker and Pierson’s definition of “the center” affects these analyses of political activists.

To read the second part of this post, click here.

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* Following their recent book, Polarized America (McCarty, Poole, and Rosenthal, 2006), I use scores on Poole and Rosenthal’s first DW-NOMINATE dimension (for details, see https://polarizedamerica.com/ and https://www.voteview.com). Hacker and Pierson report using “d nominate” scores, but these are only constructed through the 99th Congress, so I am inclined to believe that they too used the first DW-NOMINATE dimension scores.

** Hacker and Pierson (2004), page 38. Hacker and Pierson cite ANES data. According to Gallup data showing self-identified ideology, the breakdown among Americans as a whole in 2004 was roughly 20 percent liberal, 40 percent moderate, and 40 percent conservative (Wave 2 of the June Poll, Question D10). In 1972, it was 25 percent, 34 percent, and 37 percent (Poll 851, Question 14).

The views expressed in this piece do not necessarily reflect those of the Progressive Policy Institute.

Why Health Reform Can’t Wait

As the Democrats try to pick up the pieces of the blown-up public option compromise and move forward on health reform, some on the left have thrown up their hands and claim that the bill as it stands isn’t even worth passing any more. Cue Howard Dean:

“The Senate version is not worth passing,” former Democratic National Committee Chairman Howard Dean told POLITICO, referring to plans to strip the latest compromise from the bill, a Medicare buy-in. “I think in this particular iteration, this is the end of the road for reform.”

Dean said there are some good elements in the bill, but lawmakers should pull the plug and revisit the issue in Obama’s second term, unless Democrats are willing to shortcut a GOP filibuster. “No one will think this is health care reform. This is not even insurance reform,” he said. [emphasis mine]

Does Howard Dean really think that Obama is a shoo-in for a second term — and, on top of that, will face a more favorable Congress then — if the health reform effort collapses? That the bill’s failure now would lead to better chances for passage later? As Kevin Drum wrote, “If healthcare reform dies this year, it dies for a good long time.”

The estimable Nate Silver offers some forceful policy commentary to shake some sense into his fellow progressives, comparing the different scenarios for a family of four earning $54,000 under the Senate bill, under the status quo plus inflation, and under the status quo plus inflation plus S-CHIP. The result, you won’t be surprised, is that the family by far fares best under the Senate bill. Some might rightly argue that the cost is still not so affordable if a member of the family gets sick. But the costs would be debilitating without health reform at all.

Ezra Klein, who’s been banging the drum for passage, gets it right:

“This is a good bill,” Sen. Sherrod Brown said on Countdown last night. “Not a great bill, but a good bill.” That’s about right. But the other piece to remember is that more than it’s a good bill, it’s a good start. With $900 billion in subsidies already in place, it’s easier to add another hundred billion later, if we need it, than it would be to pass $1 trillion in subsidies in 2011. With the exchanges built and private insurers unable to hold down costs, it’s easier to argue for adding a strong public option to the market than it was before we’d tried regulation and a new competitive structure. With 95 percent of the country covered, it’s easier to go the final 5 percent. And with a health-care reform bill actually passed, it’s easier to convince legislators that passing such bills is possible.

Let’s hope progressive activists maintain their perspective on the bill and listen to the wonks (a divide that Steve Benen wrote about yesterday). Medicaid, Medicare, and Social Security all had their inadequacies when originally passed. But those shortcomings were addressed over time. The same would go for health care reform. But first you have to pass a bill.

The Dreams of a “Whole Foods Republican”

The efforts by a handful of conservative commentators to steer the Republican Party from its Beck-Palin trajectory continue. Here’s Michael Petrilli writing in yesterday’s Wall Street Journal:

What’s needed is a full-fledged effort to cultivate “Whole Foods Republicans”—independent-minded voters who embrace a progressive lifestyle but not progressive politics. These highly-educated individuals appreciate diversity and would never tell racist or homophobic jokes; they like living in walkable urban environments; they believe in environmental stewardship, community service and a spirit of inclusion. And yes, many shop at Whole Foods, which has become a symbol of progressive affluence but is also a good example of the free enterprise system at work. (Not to mention that its founder is a well-known libertarian who took to these pages to excoriate ObamaCare as inimical to market principles.)

What makes these voters potential Republicans is that, lifestyle choices aside, they view big government with great suspicion. There’s no law that someone who enjoys organic food, rides his bike to work, or wants a diverse school for his kids must also believe that the federal government should take over the health-care system or waste money on thousands of social programs with no evidence of effectiveness. Nor do highly educated people have to agree that a strong national defense is harmful to the cause of peace and international cooperation.

He warns that the demographics don’t look good for the GOP – that, in addition to the party’s deficit among the young, blacks, and Hispanics, college-educated Americans are now trending Democratic as well. Unless the GOP changes, the country will leave it behind.

Petrilli’s column is worth noting not because it’s bad — it actually contains sound advice for his party — but because of how comically futile it is. Asking the Republican Party to renounce anti-intellectualism is like asking a fish to renounce water. The modern GOP eats, drinks, breathes, and lives know-nothingism. You might as well ask the Republican Party to disband.

I have no doubt that there are some moderate Republicans out there who cringe at the thought of Glenn Beck and Sarah Palin. I also have no doubt that there are plenty of independents who could be persuaded by a more moderate conservatism (or, failing that, fall for something that looks like it). And I should note that I’m pretty skeptical of the Democrats’ chances in November 2010 – the anti-incumbent mood combined with the narrower electorate in midterms seems to spell doom for Dems.

That said, the party that Petrilli dreams of doesn’t look remotely like the party that he actually belongs to. Here’s what the educated, independent voter thinking of becoming a Whole Foods Republican has awaiting them: a party now comprised of an all-time-high proportion identifying themselves as “very conservative”; whose majority thinks ACORN stole the election for Barack Obama; and whose rank-and-file honestly believe that Obama has a “secret agenda” to bankrupt the country and expand the government.

Having pegged so much of their party’s identity to a culture-war mentality pitting oppressive cosmopolitans versus red-blooded heartlanders, the GOP now finds itself stuck with the ones who brung ‘em. And the ones that brung ‘em don’t want to let anyone else in, unless they look and think exactly like ’em.

Italy’s Pragmatic Progressives

Alleanza L’Italia

The big news out of Italy last weekend was the vicious assault on Prime Minister Silvio Berlusconi in Milan. The attack overshadowed the birth of a new center-left alliance determined to give Italians an alternative both to Berlusconi and a left mired in stale, social democratic dogma.

The launch of the Alleanza L’Italia (Alliance for Italy) in Parma over the weekend effectively dissolved the brief union of the two major opposition parties: the Democrats of the Left (the main social-democratic party) and the smaller, centrist Margherita (which in Italian means a daisy, not a drink). The two merged into the Democratic Party in 2007 in a bid to unify Italy’s fractious center-left.

But it was an unhappy marriage. The Democrats suffered a string of electoral defeats and leadership changes. Moderates chafed at the doctrinal rigidity of the dominant social democratic faction, which they believe has helped to polarize society while convincing many middle-class voters that progressives aren’t capable of governing. “We want to redress the balance toward the center,” explained Francesco Rutelli, the former Margherita chief and mayor of Rome who is the moving spirit behind the Alleanza. What Italy needs, he said, is a new center-left governing platform grounded in the values of “freedom, economic innovation and social cohesion.” (Full disclosure: I attended the Parma meeting as a guest of the Alleanza).

What apparently triggered the divorce was the Democrats’ decision to join the Socialist caucus in the European parliament. “Socialist parties in Europe are being defeated everywhere,” noted another key Alleanza leader, Gianni Vernetti. He’s right. In the 2009 European elections, center right parties led in 21 out of 27 European Union countries. In what many observers are calling the “European paradox,” the global financial crisis has given no boost to social democratic parties, despite their traditional skepticism toward free market economics.

One reason is that Europe’s center-right parties long ago made peace with the “social market,” which they promise to manage more efficiently. European social democrats, meanwhile, often seem more interested in defending the welfare state status quo than in modernizing their economies and politics.

Alleanza’s organizers repeatedly stressed the link between Italy’s political polarization and its economic stagnation. They promised pragmatic reforms intended to spur economic innovation and growth. And they framed their appeals to groups that have been cool to the center-left – small business operators, entrepreneurs and especially young voters, whose economic prospects are especially bleak.

The Alleanza also seems determined to break with the quasi-pacifist stance of many on the European left. Vernetti, deputy foreign minister in the last center-left government, emphasized Italy’s responsibility to contribute to security in an interdependent world. He urged progressives to rise above partisanship and approve the government’s request for funds to send 1,000 more troops to Afghanistan.

Seen from one perspective, the Alleanza’s birth marks yet another rupture in Italy’s fissiparous center-left. But from another vantage point – the need for Italian progressives to fashion a credible governing agenda for reform and renewal, to forge a new political center — it is a promising development indeed.