Daniel Henninger underscores Harold Meyerson’s points and I think there’s a kernel of truth in what he has to say:

The Democrats who were caught standing on the beach last week when the GOP’s 40-foot wave washed over them are now explaining why it wasn’t their fault.

No. 1: It’s not us; it’s what’s his name, the unpopular president. (And that awful Valerie Jarrett. )

No. 2: It was a midterm election with a bad map; we’ll be back in 2016. Hillary to the rescue.

Official Obama Explanation : My ideas and policies are fine; I just have a messaging problem.

USS Democrat Captain Nancy Pelosi : “There was an ebbing, an ebb tide, for us.”

Let me be helpful and suggest three changes the Democrats should make.

First, don’t preach economic populism and practice elitism. People eventually figure out that what you’re actually doing largely helps the highest income earners. You can fool all of the people some of the time, etc.

Second, stop riding business down. Most people work for businesses and businesses do, in fact, create jobs. Give businesses incentives to invest here and create jobs here. Don’t think that by helping five megacorporations you have helped American Business. American Business is the computer programmmer working in her living room and the guy who clears your pipes when they’re backed up, not just GE and GM. GE and GM have had a net loss of jobs in the U. S. over the last 30 years. They’re not going to be tomorrow’s job producers.

Third, stop pouring most money from most government programs into the least productive sectors of the economy especially when those relatively unproductive sectors include some of the highest paid workers in the country. When a proven way for reaching the top 1% of income earners is to get into a field that depends on government subsidies, we have a serious problem.

It’s more than just messaging. I agree with Harold Meyerson im that Democrats need to have an economic message. I think they should have focused on the economy rather than getting sidetracked by healthcare insurance, immigration, gun control, or any of the 1,001 issues they’ve turned to over the last six years other than the economy.

What messaging Democrats have had on the economy has largest been oriented towards the minimum wage. That is an error. Fewer than 3% of American workers earn minimum wage and at least half of those aren’t eligible to vote by virtue of age or non-citizenship.

After that their priority has been legalizing illegals. That isn’t even the top priority among immigrants (it’s second-highest).

This is more than just a messaging problem. It’s a problem of priorities. Democrats need to revise their priorities towards what will benefit most Americans.

Here’s Mr. Meyerson’s best suggestion:

One way to do that would be to reduce taxes on the middle class and the poor. Cutting the payroll tax would be a good place to start, offsetting the shortfall by instituting taxes on investment income that would go, like payroll taxes, to supporting Social Security and Medicare.

I don’t think that taxes on investment should be raised. I think they should be more targeted. His other ideas, e.g. infrastructure spending, are Democratic evergreens which, sadly, benefit very few workers, are poor investments these days (what’s the marginal value of the 153^rd bridge across the Mississippi?), and have weak multipliers.

I think that Democrats are going to need to think much more out of the box than this to have a solid, credible economic message and that will require a change in priorities.

It’s hard for me to get excited about a carbon emissions agreement in which China doesn’t need to do anything until 2030, that the Senate won’t ratify (if it even gets brought to the floor), that is unverifiable, and that won’t achieve any objective other than to have an agreement. I can’t help but wonder if that is the objective of the agreement: to have an agreement. If that’s the case, it’s already a rousing success.

As far as I can tell it won’t make the people who think that the entire idea of global warming is an anti-U. S. hoax happy and it won’t make the people who think that global warming threatens the very existence of life on earth happy, either.

At the Wall Street Journal Phil Gramm and Michael Solon weigh in on the issue of income inequality, drawing attention to a new study that attempts to take into account the distinction between cash income and compensation which in the United States is considerable. Offhand I would say most compensation growth for those in the bottom three quintiles has come in the form of something other than cash. Here’s their take on inequality:

How exactly are we poorer because Bill Gates , Warren Buffett and the Walton family are so rich? Mr. Gates became rich by mainstreaming computer power into our lives and in the process made us better off. Mr. Buffett’s genius improves the efficiency of capital allocation and the whole economy benefits. Wal-Mart stretches our buying power and raises the living standards of millions of Americans, especially low-income earners. Rich people don’t “take” a large share of national income, they “bring” it. The beauty of our system is that everybody benefits from the value they bring.

I don’t know enough about Warren Buffett or Wal-Mart to venture an opinion but Bill Gates became rich at least partially as a consequence of rent-seeking. Without patents and copyrights he’d still be managing a little software development company.

The kind of income inequality I’m worried about is the kind that’s the result of rent-seeking and the scope of that is expanding rapidly. Bankers, large software companies, the entire healthcare sector, and, now, the automobile manufacturing sector are all direct beneficiaries of the federal government. They haven’t exactly pulled themselves up by their bootstraps.

How does that hurt us? Go back and read “What Is Seen and Unseen?” Then, especially in the case of banks and the healthcare sector, think about moral hazard. It hurts us because of the other things that might have been done, things that would have produced more jobs and more evenly distributed prosperity.

In response to the graph depicting productivity vs. real hourly compensation that Josh Marshall produces in a post about what Democrats need to do to bounce back from the last election, I’d like to offer the graph above.

There are lots of reasons that real hourly compensation has stagnated over the last 40 years and I’m sure that every reader can name two or three. But the graph above illustrates a big one.

I have no opinion on the substance of Noah Smith’s post over at Bloomberg. I think it’s probably true that macroeconomists don’t know what the heck is going on right now. That’s always a safe bet.

However, I was amused by a choice of language. At least implicitly the post uses three different words to refer to economists who have adopted an updated version of Irving Fisher’s predictor of nominal and real interest rate behavior: Neo-Fisherists, Neo-Fisherians, and Neo-Fisherites. Do the three have different meanings? Different connotations? Different regional origins? The world may never know.

I’m reminded of a conversation I had with a well-known Russian grammarian more than forty years ago. In response to my question about how you would say a particularly difficult English sentence in Russian, he thought for a moment and replied “We’d avoid it.”

I think that would be my advice here, too. Avoid talking about economists who are trying to update the Fisher equation.

I may be the only holdout. For me November 11 will always be Armistice Day.

I’m not sure why that is. I do not feel the need to make everything about us, about the present. For me remembrance is the most human of human actions.

In remembrance of the end of the Great War, you might want to take a look at this speculative article on what would have happened if the Central Powers had won World War I:

As a preliminary matter, we should note that the actual outcome of the First World War was a near thing, a far nearer thing than was the outcome of World War II after 1941. While it is true that the United States entered the war on the allied side in 1917, thus providing vast new potential sources of men and material, it is also true that Germany had knocked Russia out of the war at about the same time. This gave the Germans access to the resources of Eastern Europe and freed their troops for deployment to the West. The German Spring Offensive of 1918 actually succeeded in rupturing the Allied line at a point where the Allies had no significant reserves. (At about this time, British Prime Minister Lloyd George was heard to remark, “We are going to lose this war.” He began to create a record which would shift the blame to others.)

I both agree and disagree with Mr. Reilly’s ideas on the subject. I think that his answer is far too Eurocentric.

With the Tsar gone and Russia in a state of chaos following the revolution there would have been an opportunity for the expansion of Austro-Hungary. Germany might well have expanded westward as Mr. Reilly suggests but Austro-Hungary would undoubtedly have expanded eastward into Romania and Ukraine.

If the Central Powers had prevailed would the partitioning of the Ottoman Empire have taken place? If the empire were still unified would the Turkish War of Independence have succeeded? I just don’t know enough about internal Turkish society and politics of the early 20th century to speculate. I’m pretty confident that a Middle East that remained under the Ottoman would have been very different from the one that existed in the middle of the 20th century or the one that exists today.

Charlie Cooke has some prudent advice for the Republicans:

Enjoy the big victory, but remember, your brand is still badly damaged. In Fox News’s final pre-election survey, the national poll showed that while the Democratic Party had a net negative of 10 points in voter favorability—42 percent favorable, 52 percent unfavorable—the Republican Party was upside-down by 16 points—38 percent favorable, 54 percent unfavorable. The national exit poll showed a net negative of 12 points in favorability for each party. So, for the GOP, election night came with both good and bad news. The bad news being that even with this big win, Americans still do not like the GOP. The good news for Republicans, this time around, is that this election was not about you.

My advice is focus on the economy. Don’t get distracted from it by any of the bright, shiny objects of which there so many and, particularly, not by how much you may detest the president (assuming that is the case). You will be judged by whether Americans are better off in two years than they are now. Not by how fast GDP grew or how high the deficit is or how mean the president was to you.

Taking as his point of departure the same Paul Krugman column that was a point of departure for me yesterday, James Taranto makes a similar response to mine:

Left-liberal commentators are characteristically apoplectic, but few if any dispute the plaintiffs’ central contention: that the language of the statute does limit the subsidies to taxpayers who purchase policies on state exchanges. Today’s column by former Enron adviser Paul Krugman—who asserts that “the court shocked many observers” by taking the case—goes through all the alternative arguments and adds a new one that is particularly imaginative and revealing.

The column’s title, “Death by Typo,” signals two of the arguments. The oft-heard claim that the statutory provision is a mere “typo” is frivolous. “There is a specific legal doctrine that deals with typos—the scrivener’s error doctrine,” observes Sean Trende of RealClearPolitics. “As far as I can tell, the government has not asserted the scrivener’s error doctrine in this case. It isn’t that someone mis-copied the bill upon publication. At best, it is that the bill was not carefully edited enough before being debated and voted upon.” (He means “carefully enough edited” or “edited carefully enough.”)

Krugman asserts further that regardless of what the law actually says, it is “clear from everything else in the act that there was no intention to set such limits,” and, moreover, that “you can ask the people who drafted the law what they intended, and it wasn’t what the plaintiffs claim.”

That is at best debatable. As we noted in July, one of the law’s architects, Jonathan Gruber, endorsed the plaintiffs’ claim in early 2012, although he now disavows it and falls back on the “typo” excuse.

Moreover, many lawmakers who voted for the act—along with the president—asserted at the time that it was their intention to ensure that “if you like your plan, you can keep your plan.” In that respect, the law trumped the intention. Does Krugman think the executive branch has the authority to nullify a law based on its preferred view of the “intention”? We’ll believe that if he makes an analogous argument when a Republican is in the White House.

He does put more flesh on the bones of the argument than I did as befits a man who makes his living by stating opinions unlike me for whom it is merely a hobby.

I wish that those who want the Supreme Court to make up for the Congress’s miscalculation would produce a clear statement of how they would like the Court and, more generally, the government to function not just in this specific case but as a general rule. Is it their preferred approach to government that the president articulate some lofty goals, the Congress endorse that by dumping a boatload of hastily drafted thoughts onto pages, basically whatever they can get the votes to enact, and the Court, the least democratic of the three branches of government, remedy the deficiencies later?

What was it that the road to hell was said to have been paved with? The idea that intentions can be imputed from political affiliation makes me very uncomfortable.

Quite to the contrary I think that you can infer intentions from what people actually do.