Barney Frank's Grand Bargain

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A latter-day Lyndon? [dpanarelli / Flickr]

Barney Frank wants to make a deal. He’ll chair the Financial Services Committee in the House when the 110th Congress launches in January; like Charlie Rangel with his draft, Frank is using the news vacuum of a lame-duck Congress to make his intentions clear.

He’s been floating the idea of a Congressionally-mediated “Grand Bargain” between economic populists and free traders. The populists get federal subsidies for health care, an increase in the minimum wage, more freedom to create unions and better access to college loans. The free traders get, well, free trade.

Health care and free trade have long been debated as unrelated subjects, but like Lyndon Johnson — who in the fifties horse-traded Western dams for civil rights — Frank is attempting the impossible. He accepts that tariff-free borders are crucial to long-term economic growth, and that long-term economic growth is, in fact, good for everyone.

At the same time, he points out that economic dislocation is particularly hard on the ones being dislocated, and that perhaps a part of what voted the Democrats in this year is a general sense that even if the economy is doing well right now, we the people are not.

Is such a bargain even possible? Who has to give up what? Is there a such thing as a win-win in American politics?

Barney Frank

U.S. Representative, D-MA

Brad DeLong

Professor of Economics, University of California at Berkeley

Blogger, Brad DeLong’s Semi-Daily Journal

Jeff Faux

Founding President and Distinguished Fellow, The Economic Policy Institute

Jacob Hacker

Professor of Political Science, Yale University

Author, The Great Risk Shift: The Assault on American Jobs, Families, Health Care, and Retirement – And How You Can Fight Back

Extra Credit Reading

Steve Benen, Barney Frank envisions a ‘grand bargain’ with corporate America, The Carpetbagger Report, November 20, 2006: “‘I’m a capitalist, and that means I’m for inequality,’ Frank said. ‘But you reach a point where you get more inequality than is healthy, and I believe we’re at that point.'”

David Sirota, Top Dem Announces “Grand Bargain” to Undermine Election Mandate on Trade, November 10, 2006: “This doesn’t sound like a ‘grand bargain’ – it sounds like laying the groundwork for selling out just a few days after an election where a major mandate for change on trade was very clear.”

GeneH, Barney Frank’s “Grand Bargain”, Practical Machinist Manufacturing Forum, November 23, 2006: “One wonders what a self employed business person will get from Sarbanes-Oxley reform or special subsidies for trading abroad, especially if they have to chip in for “Universal Health Care” taxes?”

Michael Kranish and Ross Kerber, Rep. Frank offers business a ‘grand bargain’, The Boston Globe, November 19, 2006: “Frank proposes that if businesses support a minimum wage increase and provide protection for workers adversely affected by trade treaties, Democrats would be more willing to ease regulations and approve free-trade deals.”

Via valkyrie617: Joe Nocera, Talking Business; Resolving to Reimagine Health Costs, The New York Times (TimesSelect), November 18, 2006.