Patterson did the right thing by resisting promoters of Caroline Kennedy

New York Gov. David Patterson is taking a lot of hits for how he handled what's being called the "fiasco" over his naming a successor to former senator Hillary Clinton, the Obama Administration's new Secretary of State. But in resisting intense pressure to name Caroline Kennedy, which included a last-minute inquiry by Kennedy about where she stood, Patterson was doing his job under extremely difficult conditions. Hurray for him.

Instead of being muddle-headed, as he's been portrayed in some media reports, Patterson looks to have shown tough resolve and a sharp sense of assessing the top senatorial candidates' political skills, as this New York Daily News piece shows. Key grafs:

"In meetings, the governor and his aides decided [Kennedy] had no political depth, the source said.

"She had no firmly held views and little idea about why she wanted the job, the source said."

So instead of caving to the pressure from the formidable Kennedy claque, Patterson named a relatively conservative upstate Democrat, Rep. Kirsten Gillibrand, who had won her seat in 2006 by ousting a hitherto entrenched Republican.

While Gillibrand does not have the dynastic trappings of Kennedy, she comes from a politically active family, and, in contrast to Kennedy, enjoys the endless meet-and-greet chores that any politician must embrace. Those chores are often dismissed in the media, but they are a crucial part of the compact that politicians -- good ones -- make with the voting public. Eating a knish in Manhattan or milking a cow upstate does not a great elected leader make, but it tells the public that the candidate does not live in a self-created bubble.

Caroline Kennedy lives in a bubble of privacy. With her tragic family history, she's entitled to do so -- but not if she wants to be the junior senator from New York State. In her audition for that job, she seemed to want to keep her bubble mostly intact, deciding when and where she would occasionally step out of it. This is what turned off Patterson, it looks like. It seems not to have turned off the Kennedyites, including high-ranking politicians who could make life difficult for Patterson, especially if he decides to run, as he is expected to do, for a full term in 2010, beginning with a Democratic primary.

By the time Gillibrand is comfortable with her 99 colleagues in the Upper Chamber, I'll bet most of Patterson's critics will concede he did the right thing.

Caroline Kennedy does the obvious thing

The New York Post, I'm sure, got it exactly right when it reported that Caroline Kennedy withdrew as a candidate to replace Hillary Clinton as junior senator from New York because she knew she was not Gov. David Patterson's choice.

The unsourced claims that Kennedy withdrew out of concern for her ailing uncle, Sen. Ted Kennedy, seems a pretty obvious cover story. Are we supposed to believe that the daughter of Jackie and John Kennedy was prepared to become Ted Kennedy's caretaker?

Throughout Thursday, there was a flurry of reports -- always citing sources "close to" somebody important, beginning with Patterson -- about Kennedy problems ranging from "tax issues" regarding a nanny to the state of her marriage to Edwin Schlossberg. I'm sure that there were all kinds of peripheral issues that could be brought to bear. But there's something far more important regarding the exit of Caroline Kennedy from electoral politics. The uncomfortable truth is that Kennedy, despite her estimable pedigree, showed no political skills or charm when she entered the selection race after Clinton was nominated by President-elect Obama for secretary of state last month. Polling in mid-January showed that New York Attorney General Andrew Cuomo was preferred by more New York State voters than Kennedy. Patterson, who is an accomplished politician, had to wonder whether Kennedy could live up to the challenge of being a senator from New York (think Clinton, Daniel Moynihan and, of course, Kennedy's uncle, Robert).

Kennedy's several attempts to improve her very private, Upper East Side image (which included not voting in many elections) by glad handing with upstate politicos looked contrived. She was not in her element, and photographs that emphasized her strained public demeanor didn't help.

Many offspring of the three politically successful Kennedy brothers -- John, Robert and Ted -- have stumbled badly as they tried to keep the dynasty alive.

Right now it looks like that dynasty might end with the youngest of the brothers.

President Obama's Inaugural Address climbed no peaks

President Obama's Inaugural Address will not likely be mentioned with Franklin Roosevelt’s First Inaugural or John F. Kennedy’s Inaugural, much less Abraham Lincoln’s Second Inaugural. It was poorly constructed and forced in its delivery. Worst of all, Obama missed his opportunity to embolden Americans to recapture their misplaced sense of national purpose.

Early in the speech, he said:

“Today I say to you that the challenges we face are real, they are serious and they are many. They will not be met easily or in a short span of time. But know this America: They will be met.”

By saying, categorically, that the challenges “will be met,” Obama invites Americans to be complacent at one of the country’s most critical moments.

Later, he veers close to what we were led to believe would be the real message of his address – re-dedication to individual and collective responsibility. But he missed the mark with these anticlimactic words:

“Starting today, we must pick ourselves up, dust ourselves off, and begin again the work of remaking America.”

What a letdown! For Obama, the “work of remaking America” is nothing more heroic than building “roads and bridges, the electric grids and digital lines,” and improving health care.

These objectives are fine, but they don’t address Americans’ need to recover their sense of national purpose, of the kind of collective action that has continually breathed new life into the words of our country’s founding documents.

Obama seems to suggest we don’t need to do anything so basic:

“On this day, we gather because we have chosen hope over fear, unity of purpose over conflict and discord.”

But have Americans “chosen hope over fear”? All around us we see numerous examples that tell another, far more problematic story. It’s no so much that most of us are paralyzed with fear, but that we are doubtful – about our financial system, about our economy, about the ability of either the private or public sector to respond to crises that radiate throughout the U.S. and beyond to every section of the globe. We are sometimes even doubtful about ourselves, wondering if we have distracted ourselves from purposeful civic action by clinging to a distorted sense of national exceptionalism, consumerism and perhaps excessive attention to our personal and family lives.

Actually, it was invocation speaker Rick Warren who ventured into this sensitive zone, imploring:

“Help us, O God, to remember that we are Americans, united not by race, or religion, or blood, but to our commitment to freedom and justice for all. When we focus on ourselves, when we fight each other, when we forget you, forgive us. When we presume that our greatness and our prosperity is ours alone, forgive us. When we fail to treat our fellow human beings and all the earth with the respect that they deserve, forgive us.”

Warren’s message was that Americans must get back on the path to accountability. He didn't match Moses admonishing the idol-enamored Israelis, but he was not mealy mouthed. In contrast, Obama said all we had to do was, in effect, pour concrete, pound nails and computerize medical records.

The 44th President's Inaugural Address didn't reach toward greatness. But Obama will, in the weeks and months ahead, sure have more opportunities to inspire Americans to reclaim the true greatness of their country. I am sure the new President, a quick learner, will seize them.

Bush administration $17.4B auto plan provides the carrots -- and the stick

General Motors and Chrysler now have a chance to become 21st century automakers.

The Bush administration's $17.4 billion loan plan provides the necessary carrots and the stick. According to the Wall Street Journal:

"The deal is contingent on the companies' showing that they are financially viable by March 31. If they aren't, the loans will be called and all funds must be returned, officials said."

The plan means GM and Chrysler won't have to go through what would have been a destructive bankruptcy. It doesn't guarantee they'll recover from their years of blindered decision making, but the money, plus costs savings and new product technology and design that are already being put in place, means the automakers have a shot at competing with foreign companies who produce increasingly popular U.S.-made vehicles.

GM, Chrysler and Ford (which doesn't need emergency financial help) can turn automaking into a "green" industry. If they become technology leaders in low-pollution, all-electric autos, the Big 3 could capitalize on major growth that's projected in global sales as millions more poor people achieve middle-class status in countries like China, India and Brazil.

Rick Warren is a 'conservative' evangelist, but what does that mean in the Obama era?

When the pastor of my former Catholic parish announced from the pulpit several years ago that Rick Warren's "The Purpose-Driven Life" would be the text for our Lenten studies program, I exclaimed to myself (in a whisper) Oh, no -- from Paul, Augustine, Teresa of Avila, Aquinas and Thomas Merton, we go to a TV evangelist for spiritual insight and guidance?

I had heard about Warren's book, and lumped it with other inspirational best-sellers that clog bookstore tables, right next to those on how to lose weight (in six or eight or 10 easy steps).

But while preparing some material for my parish's Lenten studies, I had to confront "The Purpose-Driven Life." The first two paragraphs forced me to rethink my stereotypes:

"It's not about you.

"The purpose of your life is far greater than your own personal fulfillment, your peace of mind, or even your happiness. It’s far greater than your family, your career, or even your wildest dreams and ambitions. If you want to know why you were placed on this planet, you must begin with God. You were born by his purpose and for his purpose."

These words were the perfect antidote for our narcissism. They had, I immediately recognized, a Pauline thrust -- direct, prodding and aimed well beyond the reach of our reflected images. Warren recognized that we were the lineal descendants of the clever, self-regarding, high-maintenance Corinthians who were such a special, and recurring, challenge to Paul.

What Warren preaches -- like Paul -- is that "God is not just the starting point of your life; he is the source of it." In other words, faith is not a one-on-one negotiation between man and God , it is a surrender of man to God.

Yet Warren, again like Paul, is not saying that surrender to God means man is essentially a nobody. He writes:

"...there is a God who made you for a reason, and your life has profound meaning! We discover that meaning and purpose only when we make God the reference point of our lives. “The only accurate way to understand ourselves is by what God is and by what he does for us [paraphrase of Romans 12:3]. ”

Warren strikes a balance between man as the center of the universe and -- the other extreme -- a mere dot.

Some more conservative Southern Baptist religious leaders criticize Warren as a "feel good" evangelical. But Warren himself specifically rejects that notion:

"The number one goal of a hedonist is to feel good, be comfortable, and have fun."

President-elect Obama's decision to have Warren deliver the invocation at his Inaugural has enraged gay groups because Warren -- pastor of the huge Saddleback Church in Orange County, CA -- supported the successful Proposition 8 banning same-sex marriages in California.

Gays make a good point, but the Obama Inaugural team argues that the day-long event will be inclusive. The benediction will be given by the Rev. Joseph Lowery, whom the Rev. Martin Luther King Jr. chose to lead the epochal civil right march from Selma to Montgomery in 1965, and who today is a supporter for gay marriage. The Lesbian and Gay Band Association will, for the first time, march in the Inaugural parade.

But, in the end, obsessing about who's conservative or liberal or in-between runs counter to the new spirit that Obama has sought to kindle from the beginning. In the lexicon of labels, Rick Warren is indeed a "conservative" religious leader. But that label doesn't tell us much about Warren's spiritual message of finding purpose in our lives.

President-elect Obama -- who technically would be called a "liberal" -- speaks about purposeful lives too.

It's no coincidence.

Bernard Madoff -- the unlikely macher

What was Bernard Madoff really thinking, and when?

In all the extensive coverage of the multi-billion-dollar fraud connected with this so-called pillar of Wall Street, I don't find any substantial clues helping to explain why or when Madoff started his self-described Ponzi scheme. Did it begin after he tried, perhaps unsuccessfully, to be a Wall Street Master of the Universe?

To me, that seems the likely explanation. It's hard to believe Madoff consciously made fraud the starting point of his investment ventures back in the 1960s. He would have had to know that such a pyramid scheme would, sooner or later, collapse -- at which point his inflated status would become a shrinking, flubbering balloon.

I am not persuaded that Madoff was quite the macher -- Jewish "big shot" -- he's described as in the media. Yes, he gave to Jewish charities and he had rich people literally begging to permit them to invest in his funds. But can you see this pudding-faced guy holding down a mike at, say, a New York charity event, and triggering a wave of inside laughter as he laser-beams the real big shots commanding the center tables?

Here's how Madoff described his investment company, as reported by Los Angeles Times columnist Tim Rutten:

"In an era of faceless organizations owned by other equally faceless organizations, Bernard L. Madoff Investment Securities LLC harks back to an earlier era in the financial world: The owner's name is on the door. Clients know that Bernard Madoff has a personal interest in maintaining the unblemished record of value, fair-dealing and high ethical standards that has always been the firm's hallmark."

No real macher would powder his image with such platitudes.

Madoff was "smart," he worked hard and -- here I'm venturing into perhaps pop psychologizing -- he wanted to make his mark in a world where there were many Masters of the Universe who were not only "smart" and worked hard, but had that je ne se quois that I don't think Madoff had but sought.

So, to continue my theorizing, what could Madoff do to compete against -- even outdo -- the Masters who got all the attention? He could deliver investment returns that over time would beat the ups and downs of the mercurial Masters. That, I believe, was the road to perdition for Madoff. Perhaps early on he had to do a little trimming if not cheating on returns in the hope that his market guesses would, over the longer term, pay returns bigger than the Masters. But if Madoff proved to be no more a Master of the Universe than he was a macher, what could he do? The better question might be what would he have been forced to do?

The answer, I believe, was replacing small-scale trimming and chating with the massive Ponzi pyramid that ultimately would collapse. If Madoff, cornered by his bad choices, resorted to such a dead-end scheme, then he was perhaps still rational but not sensible.

Rational people can spin logic up to the point of walking off a cliff. Look at all the business executives who have found a cliff to walk off in the current financial crisis. Sensible people don't do that.

Will what's left in TARP go to Detroit Big 3?

The collapse of legislation in the Senate to help save the Detroit Big 3 may or may not spell the end of emergency aid for the automakers. The White House says it's considering using what's left of the $700 billion TARP financial bailout fund to finance the $14 billion bridge loan that was torpedoed Thursday by GOP senators. The bridge loan would keep the Big 3 alive until a longer-term aid plan was taken up by the new, more Democratic Congress in January.

If the bridge loan fails, Chrysler says it will close all 59 of its plants and lay off 53,000 workers. GM hasn't announced what it would do, but even if it stays alive through Chapter 11 reorganization, it would probably be forced to close plants, adding thousands more to the unemployment rolls.

The impact on the U.S. economy, which has seen job losses totaling nearly 2 million through November, would be devastating. A big plunge in the markets today could concentrate minds, and, one way or another, produce the $14 billion bridge loan for the Big 3.

A not incidental note: The drive by Senate Republicans that killed rescue legislation was led by GOP members from Southern states, where international automakers have non-union production facilities. Heading the Southern opponents was Richard Shelby of Alabama, where the internationals have several major facilities.

$73 hourly salary for Big 3 production workers adds up to bad math

Most media commentary on General Motors and the Big amounts to one endless smackdown. But yesterday and today the New York Times offered quite different takes on the ailing domestic automakers. First, there was the profile of GM Vice Chairman Robert Lutz. My favorite quote from the tart-tongued Lutz:

“My sense of frustration is that all of this is hopelessly out of date,” he said. “Much of what I read and hear is reflective of the criticism that would have been legitimate of General Motors in the 1980s, but not today.”

The other piece is an admirable deconstruction of that frequently quoted "$73 an hour" that Big 3 production workers are supposed to make -- way over the $45 hourly salary that Toyota, Honda and other international automakers pay to their American workers. The biggest reason for the difference is the $15 share of the Big 3 hourly wage that covers pension payments to retirees. The internationals don't have to add that number to the wage costs of their workers because they don't have -- yet -- many thousands of retirees.

The bad news about newspapers

Bad news about newspapers just keeps coming. Tribune Co., owner of the Chicago Tribune and Los Angeles Times, among other nameplates, has filed for bankruptcy, McClatchy is reportedly trying to sell its prestigious (19 Pulitzers) Miami Herald and Scripps Howard is virtually begging for a buyer of its 150-year-old Rocky Mountain News in Denver.

Penny stocks now include some major newspaper companies: Journal Register, whose holdings include 22 dailies, among them the New Haven Register, sells for 6/10 of 1 cent a share, down more than 99 percent from its price two years ago. GateHouse Media, which owns eight dailies and more than 500 community publications, sells for 8 cents a share, also down more than 99 percent from its price two years ago.

Companies with the most prestigious nameplates have also been sucked into the downward swirl. The New York Times Co.'s share price has fallen from the mid-$20s two years ago to the mid-$7s, and the Washington Post Co., from the $700s to the $400s.

The recession has accelerated these dismal trends, but the bigger and longer-term problem is the migration of print readers to the Internet. Newspapers have responded by developing websites, but in a ham-handed way. Basically, the sites are simply electronic versions of the print products, with a few webby bells and whistles. Newspapers are mostly clueless in building websites that are interactive, socially sticky communities.

Here's what a sampling of dailies in some of the biggest markets offer potential online audiences in the millions: Detroit Free Press, Atlanta Constitution, San Diego Union-Tribune. Is it any wonder that newspaper web traffic, overall, shows such weak growth, compared to non-newspaper news sites?

An important exception is the New York Times, whose website attracts 20 million unique visitors monthly -- 20 times its print circulation. But even the Times site doesn't really exploit the potential of its huge, demographically attractive audience. If it did so, I argue in this article on Online Journalism Review, it might generate millions of dollars that would offset the double-digit percentage losses in advertising in the Times print version.

The Times' 20 million unique visitors are a community waiting to be formed, but the Times has to create some social networking opportunities for that to happen. Other newspapers, big and small, could create their own communities. Look at the success of Facebook and other networking sites. They are filling a vacuum while newspapers stumble about trying to convert their print products to pixels.

Very bad news -- and there are few signs it'll get better.

"Meet the Press" gets a new moderator, but it's still stuck with its 60-year-old format

The new moderator of "Meet the Press" -- the successor to the late and venerated Tim Russert -- is David Gregory. Gregory is articulate, well informed, convivial and probing. When he feels he's being spun, he can be waspish. Early on, President Bush gave him the White House Press Room nickname "Stretch," in recognition of his 6-foot-5 height. But after what Bush seemed to think was one too many assaultive questions, he cut the NBC correspondent down to size with the new nickname "Little Stretch."

Given all his qualities, Gregory would seem to be destined to be a successful successor to Russert. But is that what's desirable? Astonishingly, "Meet the Press" has changed very little in its 60 years. The format is (usually) a top government official being grilled by the moderator. Russert pumped some new life into the creaky format by displaying sometimes embarrassing and even contradictory quotes by the guest (in block letters or even video), and then, prosecutorial style, asking the quotee to explain.

Transitional "Meet the Press" host Tom Brokaw did just that Sunday morning with President-elect Barack Obama. But Obama knows how to cool down the hot seat. Brokaw tried to get Obama to say something for the record about whether he supported a "pre-packaged bankruptcy" as a condition for federal loans to General Motors, Ford and Chrysler. Obama, shrewdly, refused to step into a trap that would launch a flurry of stories that would force him into defensive explanations over several days that undermined his President-elect maneuverability. When Brokaw persisted, Obama just kept moving the issue to other areas of discussion.

I don't see how Gregory will be able to extract much more from his subjects. He is, of course, younger (38), hungrier and more energetic than Brokaw (who, in his 68th year, would prefer to be fishing in Montana) and, as he's shown at Bush's White House press conferences, can throw some sharp darts when he thinks he's being spun. But Obama and his communications-savvy team will be ready for the darts. Other potential "MTP" guests, Democratic or Republican, also have learned how to cope with the "gotcha"-tuned format.

"Meet the Press Executive Producer Betsy Fischer should use the transition from Russert to Gregory to take the program to a whole new level that reflects the radical changes that have come to how the media and the public relate in a world where the consumers of news can be producers as well. "Meet the Press" is, to be blunt, out of date with its 60-year-old format. One obvious post-Russert change it could make would be to display not only the sometimes embarrassing or contradictory quotes of the interviewee, but comments by "MTP" viewers, who would be invited to contribute their thoughts as the program is being broadcast live Sunday morning. Those on-the-fly comments would give Gregory a rationale to be persistent when his subject tries to change the subject -- as Obama did, and successfully so, with Brokaw Sunday.

Uinterview -- whose subject is the entertainment world -- is one example of how to turn passive audiences into active, and productive, participants -- no green room required.

Maybe "Meet the Press" needs a new name -- "Meet the Press & the Public."

If the auto Big 3 is a bad business model, which industries are better?

The Big 3 automakers don't deserve federal loans, say critics, because they have lousy production, sales and financial records and their restructuring promises are too little too late. So which other U.S. industry has a better business model, and can prove it by its composite stock performance or at least its last quarterly and yearly results ?

Banks?

Investment companies?

Mortgage companies?

Real estate investment trusts?

Hedge funds?

Retailers?

Electronics?

Internet?

Chemicals?

Trucking?

Restaurants?

Newspapers?

Airlines?

Health care?

If you want to see how well (i.e. badly) any of these industries are performing, check out this chart.

Which of the most financially hurt companies in these industries have presented detailed restructuring plans that include their CEO's reducing their salaries to $1 per year until the firms' financial situations are turned around, as the Big 3 chiefs have pledged to do? If any companies from these industries have done so, I missed it.

If Congress turns thumbs down and forces the Big 3 into bankruptcy, that decision will create an economic cataclysm more severe than any of the worst recession scenarios that have been spread before us like upside down Tarot cards.

Astonishingly, newspapers and the rest of the media -- among the worst industry performers -- are clamoring loudest to gangplank the Big 3 into bankruptcy.

I hope they're spared what they wish on the Big 3.

Big 3's restructuring is a road map to saving jobs and making them green

The blather about "pre-packaged bankruptcy" for General Motors and possibly Ford and Chrysler continues to echo in media reports, but is fading fast as the automakers present their restructuring plans as a precondition to federal loans.

Bankruptcy, however it would be tied up with ribbons, would ensured the death -- immediate or within a few years -- of that considerable part of the auto industry owned by U.S. companies. The auto Big 3 is often called "Detroit," but nearly half of the companies' domestic jobs -- 112,000 -- aren't in Detroit or Michigan. They're in Ohio, Indiana, Wisconsin, California and other states. Then there are all the other related jobs -- auto parts, sales, etc. -- that bankruptcy would also wipe out.

Take a look at the restructuring plans presented to Congress by GM, Ford and Chrysler. They all agree that even under the worst production scenario, each company can return to profitability over the next four years -- and pay back the $34 billion total in loans they're seeking.

They companies detail soon-to-be-realized savings from their historic 2007 labor contracts with the United Auto Workers, and other recent and future cost cutting that will, finally, let them produce all their vehicles -- including money-losing small ones -- at a profit, and compete with international companies whose plants are located in non-union states.

From the GM plan:

"General Motors’ total cost per hour for new hires can now be as low as $25, growing to $35 over time, significantly below the average fully-loaded labor cost for Toyota, which public sources indicate is between $45 and $50 per hour."

With all its restructuring, the Big 3 won't ever be as big as they used to be, but will still be the power train of U.S. industry, and, with the billions they plan to invest in advanced technology, make a big contribution to the necessary greening of American jobs.

Obama and Pakistan: A die waiting to be cast

Will President-elect Obama's "new beginning" mean a new U.S. war -- in Pakistan's terrorist havens bordering Afghanistan?

Presenting his "national security" team Monday, Obama was circumspect:

"We're going to have to bring the full force of our power -- not only military but also diplomatic, economic and political -- to deal with those threats. Not only to keep America safe but also to ensure that peace and prosperity continue around the world."

But early in his race for the Presidency, on Aug. 1, 2007, he was very precise about what he would do as Supreme Commander:

"I understand that President Musharraf has his own challenges, but let me make this clear. There are terrorists holed up in those mountains [of mostly lawless tribal areas in northwestern Pakistan] who murdered 3,000 Americans. They are plotting to strike again. It was a terrible mistake to fail to act when we had a chance to take out an al Qaeda leadership meeting in 2005. If we have actionable intelligence about high-value terrorist targets and President Musharraf won't act, we will."

Pakistan's then foreign minister in the since-resigned Musharaff government, Khusheed Kasuri, assailed Obama's "very irresponsible statement," and Pakistani protests against the candidate's remarks included the very public burning of a U.S. flag in Karachi.

The new Pakistan government -- headed by Asif Ali Zardari -- is just as opposed to U.S. military action in the tribal areas. The Pakistani ambassador to the U.S., Husain Haqqani,
said in September at a presentation at the Carnegie Endowment for International Peace in Washington:

"Pakistan will not allow foreign troops to conduct operations on Pakistani soil. Never."

Haqqani cannot be stereotyped as a super-nationalist or creature of Pakistan's military. A journalist as well as diplomat, he has a inside-out understanding of U.S. interests from having been a visiting scholar at the Carnegie Endowment, adjunct professor at the School of Advanced International Studies at Johns Hopkins University and a professor at Boston University.

At the Carnegie event, Haqqani elaborated on why Pakistan was unalterably opposed to unilateral U.S. military action in his country:

"...if you go and just conduct the operation like this latest one in which you don’t get any identifiable target, then all you do is enrage people and create ill will. And that is not what you need if you are going to have a holistic approach to fighting terrorism. You need the people to support those who fight terrorism rather than those who are on the side of the terrorists."

Haqqani maintains that contrary to most perceptions in the U.S. media, Pakistan's military is making gains in those tribal areas that have been terrorist havens. He says the U.S. must be patient and give Pakistan time to gain control in the northwest, and to complete the exit of the military from politics.

But will the Obama administration be heedful? Frustrated by its inability to subdue the Taliban rebels in the Afghanistan war, the U.S. is, inch by inch, moving the battle to Pakistan's northwest, where rebels and terrorists hide and incubate. Based on his public statements, Obama appears ready to make even bolder incursions -- to protect the U.S. and its vital interests.

If Obama indeed pursues this interventionist course, what will happen to the nation of Pakistan? Will the military, which had controlled the government for more than a decade, reverse its decision to withdraw from politics -- signaled by the resignation of Musharaff in early 2008? Will Islamic militants in an already fragile nation state manage to seize control or at least be a partner in a coalition government?

In October, during the U.S. presidential campaign, President Zardari gave high government awards to Obama's VP running mate, Joseph Biden, and Republican Sen. Richard Lugar for their legislation to give Pakistan $7.5 billion in non-military aid over five years. The awards seemed to indicate at least a tacit acceptance of the bill's language regarding U.S. military aid to Pakistan -- that it would not be given unless the U.S. secretary of state certified that Pakistani security forces "are making concerted efforts to prevent al Qaeda and associated terrorists groups from operating in the territory of Pakistan."

The Biden-Lugar bill will be taken up by the House and Senate when the new Congress convenes in January. If it passes, will Obama -- who has made it clear that he will be the last word on setting U.S. foreign policy -- give it a chance to succeed? Or will he decide to expand the Afghanistan war to northwest Pakistan?

Depending on which way he goes, Pakistan could be his Iraq.

Mumbai massacre shows need for global anti-terror intelligence

The terrorist siege of Mumbai was frighteningly successful. More than two days after it began, two of the estimated 10 attackers were still holding out against all the forces that India threw at them. The message to terrorists anywhere is that with some money, careful planning and, of course, a willingness to fight unto death they can shake an entire major city to its foundations.

Mumbai will recover, but how after how long and how diminished? What will happen to foreign investment in rapidly industrializing India? To India-Pakistan relations? Which city and country will be the next targets of emboldened terrorists?

The answers to those questions may be more rueful than we even imagine -- if nations everywhere don't adopt a common strategy, reinforced by a reliable international web of anti-terror intelligence. The planned visit of a top rep of Pakistan's formidable ISI intelligence service to India is a reassuring initiative between the two often-feuding South Asian countries. But more, much more, will have to happen to prevent more Mumbais.

If the attackers were not part of Al Queada, that is even more terrifying. It would mean that massive, multiple-target offensives are within the reach of groups that may have only a fraction of the resources. That's why all potentially targeted nations must develop coordinated global anti-terror intelligence -- geared to detect not only Al Queada cells, but also smaller groups that may be exist in only one country. Until that happens, terrorist groups anywhere and of any size and mission can confidently plan the next Mumbai.

Obama and his 'centrist' economic advisers

Obama's newly assembled economic team is described as "centrists" who have a history of emphasizing balanced budgets over federal stimulus spending.

Yes, they do have that history. But Rubinomics -- of which all the members of the team were dutiful adherents -- may end up consigned to the dustbin of history.

Larry Summers, who was Robert Rubin's protege at the U.S. Treasury in the Clinton administration, hasn't been talking like a centrist lately. From a story in today's the Wall Street Journal:

"There are a lot of different ways of saying it, but the way I heard it said best was by President Zedillo about six months into the Mexican financial crisis. He said: Markets overreact -- and that means policy has to overreact. You don't want to come up late -- and you don't want to come up short."

Today's financial crisis has turned even the Republican anti-regulatory stalwart Treasury Secretary Paulson into an on-the-fly Keynesian.

And looks who's elbowed its way to a special place at the federal bailout trough -- Citibank, whose top economic adviser during its calamitous embrace of securitized mortgages was Rubin.

Christina Romer, the new chair of Obama's Council of Economic Advisers, is a resolute monetarist who thinks fiscal stimuluses, unless they are tightly controlled, lead to inflation. But at his press conference Monday, Obama called for Congress to pass stimulus legislation that may cost as much as $700 billion and extend over two years. While Obama was urging passage of this legislation, standing alongside him -- to the left and right, but not in the center, were all the members of his economic team.

Citi's reward for reckless pursuit of profits: $306B guarantees plus $20B up front

You have to believe that many banks are licking their chops after looking at the deal that on-the-ropes Citibank got from the U.S. Treasury. In exchange for a guarantee of $306 billion in very troubled Citibank real estate assets, plus the injection of $20 billion of capital on top of the $25 billion pumped in earlier, the U.S. gets $7 billion worth of preferred stock paying 8% interest annually, well below the 12-13% rate that Citi would have to pay if it could get a commercial loan, which it apparently can't. The text of the deal here.

Nowhere in the agreement does Citi receive even a velvet-gloved slap of the hand for its reckless pursuit of profits, reported with devastating detail in this investigative piece in the New York Times and this analysis by the Washington Post's excellent business columnist Steven Pearlstein, who wonders if Citi is too big to succeed.

The agreement says to banks, in effect, that the U.S. will hold them harmless for profit-at-all-cost decisons as it showers bailout money on them.

President-elect Obama said today at his news conference that the financial/economic crisis requires action extending from Wall Street to Main Street. In the meantime -- almost two months -- it looks as if one of the worst players in Wall Street will be the primary beneficiary of the federal life line.

Saving Detroit: There's a better way than bankruptcy

Why bankruptcy won't work for General Motors is masterfully explained by New York Times columnist Joe Nocera. The nut graf:

"It is a long, difficult, drawn-out process with no guarantee that a bankruptcy judge will go along with everything G.M. wants to do. Several bankruptcy lawyers I spoke to all made the same point: if there is any way these goals can be accomplished outside of the bankruptcy process, then that should be tried first."

But read the whole piece, which details how a U.S. bailout can achieve bankruptcy's goals, but without the fallout that can be fatal to a company as big and complicated as GM.

There's also this interesting piece in the Washington Post's Sunday Outlook section -- "Why Detroit Can't Keep Up" --that explains why international automakers, particularly in Europe, are so much more nimble in going from design to production, and reaching the break-even point with fewer units.

The writer, Bernard Avishai, a former technology editor at the Harvard Business Review, says the U.S. "still has the world's largest proven reserves of intellectual capital. " But the Big 3 needs to unleash that capital the way Silicon Valley does to come up with product wonders like the iPhone.

Joe Lieberman's performance as the cat who ate the canary: Gulp

Democratic Sen. Joe Lieberman's post-election "charm offensive" probably helped him keep his key Senate chairmanship, despite his all-out support for GOP presidential candidate John McCain. But I didn't see much charm in his interview with Katie Couric during her CBS Evening News program Wednesday evening. What I saw -- and heard -- was deviousness, and with a smarmy sheen.

Couric bore in on Lieberman's answer to a cable-show question regarding whether Brack Obama was a Marxist.

Couric: "You said, quote, 'It's a good question to ask.' Are you sorry you said that?"

Lieberman: "Well, that's one of those things I wish I had said more clearly. Obviously Barack Obama is not a Marxist."

Couric: "But you said it's a good question to ask."

Lieberman: "Well, then I answered that and said he's not a Marxist. I said at the time that he's somewhat to the left of me on some issues."

But here's what Lieberman actually said during the cable-show interview:

Lieberman: "Well, you know, I must say that’s a good question. I know him now for a little more than three years since he came into the Senate and he’s obviously very smart and he’s a good guy. I will tell ya that during this campaign, I’ve learned some things about him, about the kind of environment from which he came ideologically. And I wouldn’t…I’d hesitate to say he’s a Marxist, but he’s got some positions that are far to the left of me and I think mainstream America."

Notice the choice of phrasing: "I'd hesitate [emphasis added] to say he's a Marxist."

Was Lieberman trying to correct a gross distortion of Obama's economic philosophy -- as he claimed with Couric -- or was he trying to extend the life of one of the ugliest, and most preposterous, campaign smears?

I would hesitate to say it was the former.

For all its blunders, Detroit's Big 3 is a big part of the American family

I like this commentary from the Detroit Free Press about the real case the Big 3 should be making to save the U.S. auto industry. Forget parsing the numbers about "two-tier" wages and other talking points, says columnist Tom Walsh, and make a straight-to-the-heart appeal to the "American family," of which Detroit has been a prominent member for a century.

Shes my little deuce coupe
You dont know what I got
(my little deuce coupe)
(you dont know what I got)

Sure, Detroit has committed a succession of blunders in product strategy, labor deals and foot dragging on mileage standards. But it's asked for federal help only once -- $1.5 billion in loan guarantees to Chrysler in 1979 which later resulted in a $350 million windfall to the U.S. Treasury. Compare that to the hundreds of millions that have been showered on insurance giant AIG and banks which committed much more costly blunders during the mortgage securitization craze of the last decade.

Does big-hearted America want to kiss off Detroit? I don't think so.

Should Obama emulate Lincoln or FDR? It's irrelevant with 'democracy 2.0'

There's the continual debate over whether Barack Obama is or should be more like Lincoln or FDR. It's easy to get pulled into the debate because Lincoln and FDR are such huge change agents in American history, and comparisons to the 44th -- and "Change Now" -- President are irresistible.

But Obama, even before he's inaugurated, has already broken both the Lincoln and FDR molds with a new, 21st century model for how he wants to govern. He's done that by creating a Web-based grassroots force that could scarcely be imagined in Lincoln's or FDR's time -- and maybe any time right up to when Obama launched his presidential campaign in front of the Old State Capitol in Springfield, Ill., on Feb. 10, 2007 (where Lincoln gave his "House Divided" speech).

Go to the post-election Obama change.gov site, and see why it isn't useful to debate whether Obama should pursue a Lincoln or FDR model. Make sure you drill down to the blog, "An American Moment" and other sections that encourage people to get involved in issues that animate them or maybe just bear witness. Behind most of this focused but non-frenetic post-election campaign is Obama Campaign Manager David Plouffe, who, with Field Director Jon Carson, masterminded the primary strategy that nailed down whole contingents of delegates in caucus states, like Idaho, to exceed Hillary Clinton's successes in statewide votes where even a second-place performance by Obama was good for a healthy percentage of delegates.

What's clear is that Obama is attempting to create a permanent, post-election grassroots force. This force, if you read between the lines of the change.gov site, will be active not only through the first 100 but the next 1,360 days of the Obama administration. Signups will not just be cheerleaders for the Obama change mission in Washington, but active on the local and state levels in pushing climate-change, health-care reform and other Obama initiatives.

In Lincoln's administration, change was concentrated in his cabinet and in the military leaders he was active in selecting, pre-eminently Ulysses Grant. In FDR's administration, change was more horizontal -- extending from his brain trust and cabinet to the practical-minded idealists who were attracted to Washington, or conscripted, and filled old and newly created agencies. Under Obama, the agents of change will be more distributed -- to the grassroots across America, where hundreds of thousands of citizens who aren't in government and maybe don't want to be, but do want to participate in the transformation of America. Think "democracy 2.0."