Tales from the Trail

There are 11 days to Christmas, time for Congress to do the end-of-session roll in which proposals that grew cobwebs for months and months are now heading through the chambers at breakneck speed.

Tax cuts are closing in on the finish line — House Majority Leader Steny Hoyer signaled that resistance was waning among Democrats when he said there were “compelling reasons” to back the measure.

Senate Majority Leader Harry Reid today is holding out the possibility that the START treaty will be ratified before lawmakers wrap up the lame duck session. Debate could start as early as Wednesday, and Reid says he’s got the votes.

Asked if he had 67 votes to ratify START and if he was committed to having the vote before this Congress ends, Reid said: “The answer is yes on both.”

When confronted with START, a top Republican says STOP until the bill to fund the government is done.

A reboot of President Barack Obama’s White House, dubbed “Obama 2.0″ in a New York Times magazine article, is still showing the hourglass.

Many decisions about staff changes and other key issues are still far from resolved, but behind-the-scenes conversations continue.

Obama, who leaves for a 10-day Asia tour on Friday, will squeeze in time between summits and other events to huddle with aides over these issues.

Who could possibly replace Larry Summers as director of the White House National Economic Council?

The former Treasury secretary and former Harvard University president offered his own thoughts on that very question at a National Journal forum on the workplace.

It was a valedictory appearance of sorts for Summers. National Journal’s Ronald Brownstein, a longtime political writer, saved the best question for last – Did Summers agree with the view gaining traction in Washington that Obama should name a businessperson to take over his job as director of the NEC when Summers leaves to return to his teaching job at Harvard?

When it comes to framing economic policy, it looks increasingly as though Republicans are winning the debate. Not only have they made “stimulus” almost a dirty word but there seems to be a growing feeling that deficit-financed spending is not a great way to pull the economy out of a recession. Forget the conclusions of the bipartisan Congressional Budget Office about how the bailouts and stimulus of 2008 and 2009 saved millions of jobs. Forget the global consensus around the need for coordinated stimulus after the financial crisis. The American public is simply not convinced.

The Reuters/Ipsos poll released today found 57 percent of Americans believe that, when economic times are tough, cutting the deficit is a better way to create jobs than deficit-financed stimulus.

With the U.S. congressional elections just six weeks away, this finding is bad news for President Barack Obama as he struggles to convince people that Republicans drove the economy into a deep ditch and Democrats are hard at work pulling it out.

Fear returned to global financial markets today, with stocks sinking and the dollar rising sharply on renewed worries about an economic slowdown in China and the United States. President Barack Obama met with senior economic adviser Larry Summers and “talked through some scenarios” on what was playing out around the globe, and how to keep the U.S. recovery on track.

Obama, signing a bill meant to boost U.S. manufacturing, said he was determined to do everything possible to hasten the economic recovery. The problem is – how much more can he do?

Legislation to support small businesses and manufacturing and bolster state finances might be saving jobs, but are unlikely to make much of a difference if American consumers remain reluctant to buy, or if the global economy takes another turn for the worse.

Larry Summers, a top economic adviser to President Barack Obama, is a realist when he says “people are imperfect and we have not seen the last misjudgment.”

So,  in his view, financial regulatory reform is just as necessary as, well, laws aimed at ensuring safe driving.

He cites the late Senator Daniel Patrick Moynihan’s belief that people being people are probably going to drive fast and recklessly, and so it would be wise to encourage seat-belt use, build crash-proof bumpers, design highways more carefully, arrest people for drunk driving, and establish a system that made accidents less likely to result from human error.

White House economic adviser Larry Summers took a break from his busy schedule on Wednesday to engage in a bit of time travel — visiting the year 2040 when much of the world is run according to a new “Mumbai Consensus”.

Speaking at the U.S.-India Business Council, Summers envisioned a world in which India’s experience in promoting rapidly rising living standards, coupled with its strong democratic traditions, make it a new example for how countries should run their affairs.

“In the economic history of the last millennium, this is an event that ranks only with the Renaissance and with the Industrial Revolution,” Summers said, describing the fantastic gains in living standards across the globe.

Is the economic recession over in the United States? It depends on who you ask, even among President Barack Obama’s advisers.

“Today everyone agrees that the recession is over. And the questions are around how fast we’ll recover,” Larry Summers, the director of the National Economic Council, told CNN on Sunday.

But wait a minute. Not everyone agrees.

Senior White House economist Christina Romer, asked the same question on another television program, said “of course not.”