Moment of Truth

March 2010 will either be remembered as the month when the scales fell from Barack Obama's eyes and he realized that the bipartisan fantasy, given the current Republican Party, is a fool's errand. Or it will go down in history as the moment when Obama had a chance to change course and emerge as a leader -- and flinched. Which will it be?

Right up until the moment of the February 25th summit on health reform, the administration seems determined to send out mixed signals. The president has been stressing all of the areas in which his own plan overlaps some Republican bill or another. But, as Obama surely knows, most of the supposed areas of consensus are superficial.

For example, in theory both Obama and the Republicans would allow health insurance policies to be marketed across state lines. But the Democrats' version would include consumer safeguards. The Republican counterpart would encourage insurance companies to re-incorporate in the state with the weakest regulation and promote a race to the bottom.

Bipartisanship was also the word du jour when the president announced his fiscal commission. Everything is supposedly on the table. Yet no Republican seems willing to raise taxes. And no Democrat worthy of the name would sacrifice Social Security. If we had the nerve to restore progressive taxation in this country, we could have our fiscal balance and our social investment, too. No bipartisanship there.

When Alan Simpson, the Republican co-chair, was in the Senate, privatization of Social Security was one of his big causes. Under the commission's rules, it will take 14 out of 18 votes to recommend a blueprint for budget reduction. I asked a senior member of Obama's economic team how they expected a commission to reach agreement with this kind of requirement, given that Republicans block all Senate action using a much more modest supermajority. He had no good answer.

Yet the narrative of the day, articulated by Evan Bayh, Pete Peterson, and repeated by one journalist and pundit after another, is that "Washington" has become "dysfunctional." Sen. Bayh's recent op-ed in the New York Times is enough to make you vomit.

Our most strident partisans must learn to occasionally sacrifice short-term tactical political advantage for the sake of the nation. Otherwise, Congress will remain stuck in an endless cycle of recrimination and revenge. The minority seeks to frustrate the majority, and when the majority is displaced it returns the favor.

The blame, in other words, is absolutely symmetrical. That's just malarkey. But it has become pervasive conventional wisdom.

Jackie Calmes, writing in the New York Times, treats a massive lobbing campaign by foes of social insurance as dispassionate expert analysis in the public interest.

Many analysts say the president and Congress could send a strong signal to global markets by agreeing this year to a package of both long-term tax increases and spending reductions, especially in the popular entitlement programs, that would not take effect until 2012. That is the recommendation of two new studies, one by the National Research Council and the National Academy of Public Administration and the other a separate joint project of the Peter G. Peterson Foundation, the Pew Charitable Trusts, and the Committee for a Responsible Federal Budget.

Well, many other analysts say Pete Peterson, who funds so much of this tripe, is a billionaire scoundrel who is using an economic catastrophe brought about by his chums on Wall Street to cut the Social Security of people who don't have his massive wealth to fall back on.

There is nothing dysfunctional about "Washington." The Republicans have simply decided to use the filibuster to block anything that President Obama proposes, and the president, thus far, hasn't quite mustered the nerve to take them on.

As John Podesta puts it, we have a kind of perverted parliamentary system, in which the opposition party has the power to block, but the governing party doesn't have the power to govern. Kind of like Italy before it got a quasi-dictator, or France during the Fourth Republic.

Or the kind of failed states where nobody governs, and power reverts to tribes, mobs, and warlords (or in our case, to Wall Street.)

So it's show time. As Finley Peter Dunne's Mr. Dooley famously said, politics ain't beanbag. Either Obama has been playing chess all along, and he will soon spring his elegant trap on the obstructionist Republicans, or he has been playing beanbag.

Option One: The televised summit happens. It's clear once and for all that there is no common ground to be had. And Obama gives the speech we've all been waiting for.

"My fellow Americans, I've gone the last mile to find consensus, but the Republicans have made clear by their actions that they put destruction of my administration ahead of the needs of the American people. I can't let that happen, because the stakes are too high. So I am asking the House to pass the Senate bill, and then to improve the law using the budget reconciliation process."

His approval rating jumps ten points overnight just because the voters admire guts in a leader, and will settle for some sign of a pulse.

Option Two: the Republicans offer him a few scraps. He takes them. Negotiations keep dragging on. Game, set, match, Republicans.

Option Three: Obama attempts to pull off Option One, but the House and Senate Democrats are so sick of this drama, and the bill has become so toxic, that he can't muster the votes. Since the bill passed the House last November 7 by just five votes, one Democrat, John Murtha, has died. A second Democrat has changed parties. And the one Republican who voted for the bill, Joseph Cao of Louisiana, has switched to the opposition. That leaves the Dems down one. The proposed "Cadillac tax" on premiums of good insurance, the diversion of Medicare funds, the punitive mandate on individuals, coupled with the relative free ride for employers who fail to provide insurance, are even more unpopular now than in the late fall. A double defeat for the president.

It would take an uncharacteristic leap of leadership for Obama to opt for a Democrats-only bill; and even more leadership to get the Dems to vote for the thing. If he pulls it off, and also improves the bill along the way, it will mark a welcome change of direction -- but only the beginning of a long road back to the presidency we thought we were voting for. Stay tuned.

Robert Kuttner's forthcoming book is A Presidency in Peril (March, Chelsea Green) He is co-editor of The American Prospect and a senior fellow at Demos.