It is rarely a good sign when I am greeted by four Wall Street Journal "News Alerts" before six a.m. out here on the West Coast. The EuroZone is in recession, Freddie Mac announced losses of $25.3 billion, U.S. retail sales went off the cliff in October, and Sun Microsystems announced plans to lay off 18 percent of its work force.
I think I need another cup of coffee.
But the most dispiriting news of the day came from a New York Times article, "Chances Dwindle on Bailout Plan for Automakers." Not because I feel particularly strongly about a GM rescue, one way or the other, but because of the reason provided by Senator Christopher Dodd, D.-Conn., on why neither an automaker bailout or a lame-duck stimulus plan is likely to be enacted.
Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the banking committee, said he did not believe there would be enough Republican support to get the 60 votes needed to move a bill forward. "Right now, I don't think there are the votes," he said...
In the modern political era, the Democrats assume they will need 60 votes to pass anything, based on their fear of a Republican filibuster. Personally I would like to see this theory tested in practice a little more often, just so the general public gets a clear sense of exactly who is obstructing legislation, but I will concede that the current Democratic majority in the Senate is so razor thin as to make that a moot point.
The majority will be significantly larger in the new Congress, but still not up to 60, barring a surprise in Georgia and a recount victory for Al Franken in Minnesota. What this means is that Obama's chances for success, on anything will hinge on being able to convince two or three Republicans to cross party lines. Everything. A new stimulus plan, health care, climate change -- the works. For at least two years, the power to steer the U.S. economy is going to be controlled not by the President who gained 63 million votes, not by the majority party in both the Senate and the House, but by that rarest of nearly extinct creatures, the moderate Senate Republican.
Maine, with its two moderate Republican Senators, is about to become the most important state in the union.
UPDATE: For further reading:
Energy analyst Geoffrey Styles crunches the Senate numbers with a focus on energy.
Felix Salmon delivers a superb post tying together bailouts, past and future, with the Bush and prospective Obama administrations.