Now we begin the next round of chicken with deficit reduction. Expect Obama to sit down with Republican congressional leaders soon. Eventually he will offer up a plan loosely based on Bowles Simpson, designed to be acceptable to a majority of voters, and rejected immediately by the Republicans. Then comes a dance with lots histrionics and public posturing until D-day approaches in January. Democrats threaten to let the Bush tax cuts simply expire. Backed up against a fiscal disaster, Obama and Boehner will agree to something not far from where they last left off.
The next domestic policy item ought to be immigration reform. Latino voters have saved the democratic party with little to show for it. Don’t expect that to last forever. Democrats need to put forward an immigration reform proposal that is based on amnesty for most illegal immigrants that are already here and have not committed crimes. We need to make the economic argument for this proposal – which is that more workers lead to more economic growth and more tax revenue, which we will sorely need to cover the Medicare cost of a booming elder population.