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Why haven't the President and Senate Democrats pulled the reconciliation trigger before now? I haven't spoken directly with the President or with Harry Reid but I've spent the last several weeks sounding out contacts on the Hill and in the White House to find an answer. Here are the theories. None of them justifies waiting any longer. Reconciliation is too extreme a measure to use on a piece of legislation so important. I hear this a lot but it's bunk. George W. Bush used reconciliation to enact his giant tax cut bill in 2003 (he garnered only 50 votes for it in the Senate, forcing Vice President Cheney to cast the deciding vote). Six years before that, Bill Clinton rounded up 51 votes to enact the Children's Health Insurance Program (CHIP), the largest expansion of taxpayer-funded health insurance coverage for children in the U.S. since Medicaid began in the 1960s. Through reconciliation, we also got Medicare Advantage. Also through reconciliation came the COBRA act, which gives Americans a bit of healthcare protection after they lose a job ("reconciliaton is the "R" in the COBRA acronym.) These were all big, important pieces of legislation, and all were enacted by 51 votes in the Senate. Use of reconciliation would infuriate Senate Republicans. It may. So what? They haven't given Obama a single vote on any major issue since he first began wining and dining them at the White House. In fact, Senate Minority Leader Mitch McConnell and company have been doing everything in their power to undermine the President. They're using the same playbook Republicans used in the first two years of the Clinton administration, hoping to discredit the President and score large victories in the midterm elections by burying his biggest legislative initiative. Indeed, Obama could credibly argue that Senate Republicans have altered the rules of the Senate by demanding 60 votes on almost every initiative - a far more extensive use of the filibuster than at any time in modern history - so it's only right that he, the President, now resort to reconciliation. Obama needs Republican votes on military policy so he doesn't dare antagonize them on health care. I hear this from some quarters but I don't buy it. While it's true that Dems are skeptical of Obama's escalation of the war in Afghanistan and that Republicans are his major backers, it seems doubtful R's would withdraw their support if the President forced their hand on health care. Foreign policy is the one area where Republicans have offered a halfway consistent (and always bellicose) voice, and Dick Cheney et al would excoriate them if they failed to back a strong military presence in the Middle East. This is truer now than ever. Reid fears he can't even get 51 votes in the Senate now, after Scott Brown's win. Reid counts noses better than I do, but if Senate Democrats can't come up with even 51 votes for the health care reforms they enacted weeks ago they give new definition to the term "spineless." Besides, if this is the case, Obama ought to be banging Senate heads together. A president has huge bargaining leverage because he presides over an almost infinite list of future deals. Lyndon Johnson wasn't afraid to use his power to the fullest to get Medicare enacted. If Obama can't get 51 Senate votes out of 58 or 59 Dems and Independents, he definitely won't be able to get 51 Senate votes after November. Inevitably, the Senate will lose some Democrats. Now's his last opportunity. House and Senate Democrats are telling Obama they don't want to take another vote on health care or even enact it before November's midterms because they're afraid it will jeopardize their chances of being reelected and may threaten their control over the House and Senate. I hear this repeatedly but if it's true Republicans have done a far better job scaring Americans about health care reform than any pollster has been able to uncover. Most polls still show a majority of Americans still in favor of the basic tenets of reform - expanded coverage, regulations barring insurers from refusing coverage because of someone's preexisting conditions and preventing insurers from kicking someone off the rolls because they get sick, requirements that employers provide coverage or pay into a common pool, and so on. And now that many private insurers are hiking up premiums, co-pays, and deductibles, the public is even readier to embrace reform.

1. The private sector will create enough jobs, if the government gets out of the way. Possibly, but when? Right now more than 2.7 percent of our entire population has been unemployed for more than 26 weeks -- an all time-record since the government began compiling that data in 1948. No one is predicting that the private sector is about to go on a hiring spree. In fact, many analysts think it'll take more than a decade for the labor market to fully recover. You can't tell the unemployed to wait ten years. Counting on a private sector market miracle is an exercise in faith-based economics. There simply is no evidence that the private sector can create on its own the colossal number of jobs we need. If we wanted to go down to a real unemployment rate of 5% ("full employment"), we'd have to create about 22.4 million jobs. (See Leo Hindery's excellent accounting.) We'd need over 100,000 new jobs every month just to keep up with population growth. It's not fair to the unemployed to pray for private sector jobs that might never come through. 2. We can't afford it. Funding public sector jobs will explode the deficit and the country will go broke: This argument always makes intuitive sense because most of us think of the federal budget as a giant version of our household budget - we've got to balance the books, right? I'd suggest we leave that analogy behind. Governments just don't work the same way as families do. We have to look at the hard realities of unemployment, taxes and deficits. For instance, every unemployed worker is someone who is not paying taxes. If we're not collecting taxes from the unemployed, then we've got to collect more taxes from everyone who is working. Either that, or we have to cut back on services. If we go with option one and raise taxes on middle and low income earners, they'll have less money to spend on goods and services. When demand goes down, businesses contract--meaning layoffs in the private sector. But if we go with option two and cut government services, we'll have to lay off public sector workers. Now we won't be collecting their taxes, and the downward cycle continues. Plus, we don't get the services. Or, we could spend the money to create the jobs and just let the deficit rise a bit more. The very thought makes politicians and the public weak in the knees. But in fact this would start a virtuous cycle that would eventually reduce the deficit: Our newly reemployed people start paying taxes again. And with their increased income, they start buying more goods and services. This new demand leads to more hiring in the private sector. These freshly hired private sector workers start paying taxes too. The federal budget swells with new revenue, and the deficit drops. But let's say you just can't stomach letting the deficit rise right now. You think the government is really out of money--or maybe you hate deficits in principle. There's an easy solution to your problem. Place a windfall profits tax on Wall Street bonuses. Impose a steep tax on people collecting $3 million or more. (Another way to do it is to tax the financial transactions involved in speculative investments by Wall Street and the super-rich.) After all, those fat bonuses are unearned: The entire financial sector is still being bankrolled by the taxpayers, who just doled out $10 trillion (not billion) in loans and guarantees. Besides, taxing the super-rich doesn't put a dent in demand for goods and services the way taxing other people does. The rich can only buy so much. The rest goes into investment, much of it speculative. So a tax on the super rich reduces demand for the very casino type investments that got us into this mess.

3. Private sector jobs are better that public sector jobs. Why is that? There is a widely shared perception that having a public job is like being on the dole, while having a private sector job is righteous. Maybe people sense that in the private sector you are competing to sell your goods and services in the rough and tumble of the marketplace--and so you must be producing items that buyers want and need. Government jobs are shielded from market forces. But think about some of our greatest public employment efforts. Was there anything wrong with the government workers at NASA who landed us on the moon? Or with the public sector workers in the Manhattan project charged with winning World War II? Are teachers at public universities somehow less worthy than those in private universities? Let's be honest: a good job is one that contributes to the well-being of society and that provides a fair wage and benefits. During an employment crisis, those jobs might best come directly from federal employment or indirectly through federal contracts and grants to state governments. This myth also includes the notion that the private sector is more efficient than the public sector. Sometimes it is, but mostly it isn't. Take health care, which accounts for nearly 17 percent of our entire economy. Medicare is a relative model of efficiency, with much lower administrative costs than private health insurers. The average private insurance company worker is far less productive and efficient than an equivalent federal employee working for Medicare. (See study by Himmelstein, Woolhandler and Wolfe) 4. Big government suffocates our freedom. The smaller the central government, the better -- period, the end. This is the hardest argument to refute because it is about ideology not facts. Simply put, many Americans believe that the federal government is bad by definition. Some don't like any government at all. Others think power should reside mostly with state governments. This idea goes all the way back to the anti-federalists led by Thomas Jefferson, who feared that yeomen farmers would be ruled (and feasted upon) by far-away economic elites who controlled the nation's money and wealth. In modern times this has turned into a fear of a totalitarian state with the power to tell us what to do and even deny us our most basic liberties. A government that creates millions of jobs could be seen as a government that's taking over the economy (like taking over GM). It just gets bigger and more intrusive. And more corrupt and pork-ridden. (There's no denying we've got some federal corruption, but again the private sector is hardly immune to the problem. In fact, it lobbies for the pork each and every day.) It's probably impossible to convince anyone who hates big government to change their minds. But we need to consider what state governments can and cannot do to create jobs. Basically, their hands are tied precisely because they are not permitted by our federal constitution to run up debt. So when tax revenues plunge (as they still are doing) states have to cut back services and/or increase taxes. In effect, the states act as anti-stimulus programs. They are laying off workers and will continue to do so until either the private sector or the federal government creates many more jobs. Unlike the feds, states are in no position to regulate Wall Street. They're not big enough, not strong enough and can easily be played off against each other. While many fear big government, I fear high unemployment even more. That's because the Petri dish for real totalitarianism is high unemployment -- not the relatively benign big government we've experienced in America. When people don't have jobs and see no prospect for finding them, they get desperate -- maybe desperate enough to follow leaders who whip up hatred and trample on people's rights in their quest for power. Violent oppression of minority groups often flows from high unemployment. So does war. No thanks. I'll take a government that puts people to work even if it has to hire 10 million more workers itself. We don't have to sacrifice freedom to put people to work. We just have to muster the will to hire them.

University of Edinburgh law lecturer Andres Guadamuz wrote a blog entry this week highlighting some particularly troubling aspects of the IIPA's 301 recommendations. The organization has condemned Indonesia and several other countries for encouraging government adoption of open source software. According to the IIPA, official government endorsements of open source software create "trade barriers" and restrict "equitable market access" for software companies. The profound absurdity of this accusation is exacerbated by the fact that Indonesia's move towards open source software was almost entirely motivated by a desire to eliminate the use of pirated software within the government IT infrastructure. It's important to understand that Indonesia has not mandated the adoption of open source software or barred government agencies from purchasing proprietary commercial software. The Indonesian government issued a statement in 2009 informing municipal governments that they had to stop using pirated software. The statement said that government agencies must either purchase legally licensed commercial software or switch to free and open source alternatives in order to comply with copyright law. This attempt by Indonesia to promote legal software procurement processes by endorsing the viability of open source software has apparently angered the IIPA. In its 301 recommendations for Indonesia, the IIPA demands that the government rescind its 2009 statement. According to the IIPA, Indonesia's policy "weakens the software industry and undermines its long-term competitiveness" because open source software "encourages a mindset that does not give due consideration to the value to intellectual creations [and] fails to build respect for intellectual property rights." The number of ways in which the IIPA's statements regarding open source software are egregiously misleading and dishonest are too numerous to count. The IIPA seems to have completely missed the fact that there is a very robust ecosystem of commercial software vendors in the open source software market and that open source software is at the heart of some of the most popular consumer electronics products that are sold in the United States. It has clearly become an important part of the US software economy and increasingly serves as an enabler of innovation and technological progress. In light of the profitability of Red Hat and other open source leaders, it seems absurd to contend that open source software adoption will weaken the software industry or reduce its competitiveness. In fact, the emergence of open source software has contributed to creating a more competitive landscape in the software industry by offering alternative business models that enable smaller companies to gain traction against the dominant incumbent players. The IIPA's position is profoundly hypocritical, because many parts of the US government, including the Department of Defense, have issued their own memos endorsing open source software adoption. The IIPA's disingenuous move to equate open source software with piracy reeks of desperation. The BSA and other IIPA members are likely losing sleep over open source software because that development model and approach to licensing will empower developing countries to build their own domestic IT industries, eliminating the need for them to tithe to American software giants. It's another failing of the 301 review, which Big Content wants used to coerce other countries into adopting ever-more-stringent copyright laws.

Today, he is emerging as one of the nation’s archreformers, pushing to impose some of the most stringent new financial regulations in history. And as the head of the Commodity Futures Trading Commission, the leading contender to oversee the complex derivatives contracts that played a central role in the financial crisis and, in turn, the Great Recession, he is in a position to influence the outcome. It may seem an unlikely conversion, but it is one that has won the approval of Brooksley E. Born, of all people, a former outspoken head of the commission. She sounded alarms more than a decade ago about the dangers hiding in the poorly understood derivatives market and was silenced by the same Washington power brokers that counted Mr. Gensler as a member. Mr. Gensler opposed Ms. Born, according to people who worked at the commission in the 1990s, and in 2000 played a significant role in shepherding through Congress deregulation measures that led to explosive growth of the over-the-counter derivatives market. That was then. These days, Ms. Born is convinced of Mr. Gensler’s reformist zeal, as he takes on Wall Street in what is becoming one of the fiercest battles over regulation in the postcrisis era. “I think he is doing very well,” she said in an interview. “He certainly seems to be committed to robust oversight of derivatives and limiting excessive speculation and leverage.” The proposals championed by Mr. Gensler, if adopted by Congress, would substantially alter what is now a largely unregulated market in over-the-counter derivatives, financial instruments used by companies and investors to protect themselves and bet on moves in variables, like interest rates or currencies, and to speculate. The proposals include forcing the big banks that sell derivatives to conduct their trades in the open on public exchanges and clear them through central clearinghouses, so that any investor can see the prices that dealers charge their customers. Today, those transactions are bilateral and private.