1. Honestly, I wouldn’t have surprised if Obama backed off his desire to enact immigration reform. I’m not willing to give odds on what I think the chances are of some meaningful legislation actually getting passed.

2. Middle East: Roger Cohen says Netanyahu is “crying wolf” over claims that Iran will obtain and use a nuclear weapon against Israel, and the Obama administration announces in a dramatic shift that they will join nuclear talks with Iran. Israel’s new Foreign Minister rejects the 2007 Annapolis agreement, but Obama signals that the U.S. expects Israel to comply with the agreement and, according to Haaretz, is preparing his administration for a confrontation with Israel over Palestine.

3. Eric Holder begins a “revamp” of the Public Integrity Unit at the DOJ.

4. An organization of Cuban exiles signals they are willing to accept broad changes in American’s policies towards Cuba.

5. Nicholas Kristof says that we’ve reached a turning point when it comes to animal rights.

6. Thanks to the recession, more states are considering raising taxes. Naturally, they will do so quietly.

7. A Texas Republican says Asian-Americans should change to names that are “easier for Americans to deal with.” Because of course that makes more sense than just not enacting ridiculous and unnecessary voter ID legislation.

8. Co-creator of Dungeons & Dragons Dave Arneson has died. As you may recall, Gary Gygax passed away this time last year. The world of role-playing owes both its existence and popularity mostly to these two men.

9. Idiots shoot and kill a dog belonging to a retired Navy SEAL living in the Houston area, who nearly kills them in return. Both his name and book sounded familiar so I looked him up. Sure enough, I remember him from this NPR story from 2007 recounting a battle in Afghanistan in which he was the only survivor. I can tell you that had he shot one or more of those guys, no jury in Texas would’ve convicted him.

Law Professor Yair Listokin describes in a post at Balkinization how tax expenditures (credit/deductions) are a far less efficient form of stimulating the economy than direct government stimulus, despite the fact that as he says “the total value of deductions, exclusions, and credits such as the charitable deduction nearly equals the value of direct government spending”(!) Of course, tax deductions are considerably easier to promote politically than tax increases that preclude increased government spending, which I’m sure is the main reason they are so frequently proposed and implemented despite their relative inefficiency.

Things to note in the world today:

1. Iraq: Sunni militia members in Baghdad revolted Saturday, prompted by the arrest of an Awakenings movement leader by Iraqi forces. The crisis was resolved, but it raises fears that the relationship between the government and Sunni militias-many of which are not being paid as promised-could be strained to the breaking point.

2. A profile of anti-tax nuts, many of whom never met a crazy legal argument they didn’t like.

3. The Federal government says GM and Chrysler are not viable, and refuse to offer more aid. Bankruptcy looms for both companies.

4. Mexico faces extreme difficulty putting down the drug cartels, and critics are beginning to call for a change in approach.

5. The women’s professional soccer league, version 2.0.

The tax fundamentalists are costing the GOP the Christian ones:

In what one might call a biblical move, Christian philanthropist Howard Ahmanson — one of three major funders of the campaign for California’s Proposition 8, which banned same-sex marriages — has abandoned the GOP for the Democratic Party.

No one ever said the multimillionaire isn’t idiosyncratic.

In a rare interview Thursday, Ahmanson shared some of his thoughts about why he switched parties. In a word, taxes.

Specifically, he was offended by the California Republican Party’s insistence during a recent state budget battle that there would be no tax increases for any reason, no matter what. “They’re providing one issue, and it’s just a very silly issue,” Ahmanson told me by telephone.

The Republican tent is getting smaller every day…

Kevin Drum quotes Ross Douthat, who thinks he sees a grand strategy at work in the Obama administration’s spending:

What you see in his budgeting proposals, I think, is the liberal equivalent of the conservative attempt to “starve the beast.” In both the Reagan and Bush eras, Republicans passed tax cuts and ran up large deficits while hoping that by starving the federal government of revenue they would curb its long-run growth. Obama’s spending proposals would effectively reverse that dynamic — they would create new spending commitments and run up large deficits, in the hopes that the dollars poured into health care and education will create a new baseline for government’s obligations, which in turn will create the political space for tax increases on the middle class. Like the starve-the-beast approach, the Obama strategy puts off the hard part till tomorrow: Give them tax cuts today, conservatives said, and they’ll swallow spending cuts tomorrow; give them universal health care, universal pre-K, subsidies for green industry and all the rest of it today, liberals seem to be thinking, and they’ll be willing to pay for it tomorrow.

Kevin Drum agrees with this assessment, and thinks this explains why Republicans in Congress are utterly opposed to every spending bill. But as I was explaining to Nat-Wu and Adam in an email, I don’t think this is a strategy so much as a description of events. To quote myself:

Liberals think these things are good and that people will want to pay for them. We enact them and lo, we are right! It seems more a description of events than a plan for them.

That doesn’t meant that Douthat isn’t on to something about putting off to the future necessary tax increases. Given a choice I think most people will pay more in taxes rather than see substantial cuts to programs they like. I suppose you can deride this as salesmanship, but it’s also out of political necessity. If you tried to enact these programs at the same time that you substantially raise taxes on the wealthy and marginally raise them on the middle class, you’re pretty much ensuring the death of your proposal. I suppose that’s political strategy, but it’s not really a conspiracy to enact vast social safety programs that people don’t know they want yet. It just happens to make it very difficult for Republicans to stop these programs from getting enacted, though that’s largely because most Americans agree on the need for the programs.

We discussed only yesterday David Leonhardt’s article for the NY Times, in which it becomes clear that taxes will have to rise if government is to continue providing social services that Americans have become accustomed to. In that vein, the Obama administration will propose reducing the value of itemized deductions for taxpayers in top brackets, raising revenue for the government for things like major health care reform:

The president will also propose, in the 10-year budget he is to release Thursday, to use revenues from the centerpiece of his environmental policy — a plan under which companies must buy permits to exceed pollution emission caps — to pay for an extension of a two-year tax credit that benefits low-wage and middle-income people.

The combined effect of the two revenue-raising proposals, on top of Mr. Obama’s existing plan to roll back the Bush-era income tax reductions on households with income exceeding $250,000 a year, would be a pronounced move to redistribute wealth by reimposing a larger share of the tax burden on corporations and the most affluent taxpayers.

Administration officials said Mr. Obama would propose to reduce the value of itemized tax deductions for everyone in the top income tax bracket, 35 percent, and many of those in the 33 percent bracket — roughly speaking, starting at $250,000 in annual income for a married couple.

Under existing law, the tax benefit of itemizing deductions rises with a taxpayer’s marginal tax bracket (the bracket that applies to the last dollar of income). For example, $10,000 in itemized deductions reduces tax liability by $3,500 for someone in the 35 percent bracket.

This is sort of a backhanded way of raising taxes, but whatever. Of course, Republicans will oppose it:

“Everyone agrees that all Americans deserve access to affordable health care,” Mr. Boehner said in a statement, “but is increasing taxes during an economic recession, especially on small businesses, the right way to accomplish that goal?”

So Republicans will continue to adhere to the “if the economy is good, cut taxes; if the economy is bad, cut taxes” philosophy. That’s fine. Increasing taxes is a hard sell, but I think it’ll get done. That is, if people can be persuaded that such is the cost of the things they want government to provide.

UPDATE: This Bloomberg article breaks down the costs of health care reform and the revenue produced by tax increases in greater detail. It also makes it clear that these tax increases won’t be enough, and that more are certainly on the way if we have any hope of successfully completing a reform program and cutting what is projected to be a $1.75 trillion deficit.

UPDATE II: About that cap-and-trade program, Rep. Chris Van Hollen, a Democrat from Maryland, has a different idea; take the revenue from permit and give it back to Americans in the form of a dividend. I seriously doubt this proposal will go anywhere, but interesting nonetheless. Generally though I favor the government using the money in aggregate on social programs, rather than me using a monthly check to go out to dinner somewhere.

In the wake of Obama’s speech, outlining proposals to get the economy back on track and expand the social safety net, this articles serves as a handy reminder that eventually we’re going to have to pay for all of this progress:

Americans have made it clear that they want a certain kind of government, one that can field a strong military and also maintain popular programs like Medicare. Yet we are not paying nearly enough taxes to maintain those programs. Even major changes to the health care system — the single most important step for closing the budget gap — will not close it entirely. Taxes must rise, too.

This is a point on which serious Democrats and serious Republicans agree, even if they do so with euphemism. “We are on an unsustainable path,” says Peter Orszag, Mr. Obama’s budget director. Judd Gregg, the ranking Republican on the Senate Budget Committee, has said, “Revenues are going to have to go up.” Douglas Holtz-Eakin and Dan Crippen, budget experts who advised the McCain campaign, have quietly acknowledged the same.

Fortunately, the coming tax increase does not have to be economically ruinous. Despite all the scary stories you’ve heard, the evidence that higher taxes necessarily cripple an economy is somewhere between thin and nonexistent.

When over the past 60 years did the American economy grow fastest? The 1950s and 1960s, when the top marginal tax rate was a now-unthinkable 90 percent. And when over the past generation did the economy grow fastest? The late 1990s, when President Bill Clinton briefly took federal taxes to 20 percent of the G.D.P.

The real uncertainty is how, in the current political climate, Mr. Obama will manage to persuade people that taxes must go up. In his speech on Tuesday night, he didn’t even try. But he doesn’t have forever to do so.

It’s probably safe to say that Grover Norquist flipping out somewhere. But to paraphrase Holmes, I like our civilization, I’d like more of it, and I’m willing to pay for it.

UPDATE: By the way, by all nearly accounts, Obama hit it out of the park lats night (h/t Adam.)

After he banned gimmicks used by the Bush administration to make the federal deficit look smaller than it actually was, President Obama plans to outline steps in his budget proposal this coming week to halve that deficit it in four years, primarily through tax increases on the rich and corporations (whereas 95% of Americans are about to get their taxes cut) and cutting spending on the wars in Iraq and Afghanistan:

Even before Congress approved the stimulus package earlier this month, this year’s deficit was projected by Congressional budget analysts to approach $1.2 trillion, or 8.3 percent of the overall economy, the highest since World War II. With the stimulus and other expenses, some analysts say the annual gap between federal spending and income could approach $2 trillion when the fiscal year ends in September.

Obama proposes to dramatically reduce those numbers by the end of his first term, cutting the deficit he inherited in half, said administration officials, speaking on condition of anonymity because the budget has yet to be released. His budget plan would keep the deficit hovering near $1 trillion in 2010 and 2011, but shows it dropping to $533 billion in 2013 — still high in dollar terms, but a more manageable 3 percent of the overall economy.

To get there, Obama proposes to cut spending and raise taxes. The savings would come primarily from “winding down the war” in Iraq, a senior administration official said. The budget assumes that the nation will continue to spend money on “overseas military contingency operations” throughout Obama’s presidency, the official said, but that number is significantly lower than the nearly $190 billion the nation budgeted for Iraq and Afghanistan last year.

Obama also seeks to increase tax collections, primarily by making good on his promise to eliminate the temporary tax cuts enacted in 2001 and 2003 for wealthy taxpayers, whom Obama defined during the campaign as those earning more than $250,000 a year. Those tax breaks would be permitted to expire on schedule for the 2011 tax year, when the top tax rate would rise from 35 percent to more than 39 percent.

Obama also proposes to maintain the tax on estates worth more than $3.5 million, instead of letting it expire next year. And he proposes “a fairly aggressive effort on tax enforcement” that would target tax havens and corporate loopholes, among other provisions, the official said.

Overall, tax collections under the plan would rise from about 16 percent of the economy this year to 19 percent in 2013, while federal spending would drop from about 26 percent of the economy, another post-war high, to 22 percent.

That’ll deliver on three campaign promises right there… but wait, let’s not forget about health care:

The budget also puts in place the building blocks of what administration officials say will be a broad restructuring of the U.S. health system, an effort aimed at covering some of the 46 million Americans who lack insurance while controlling costs and improving quality. Many lawmakers said they had expected a health care overhaul to be pushed off while Obama deals with the economic crisis, but administration officials stressed they intend to forge ahead with comprehensive reform…

Administration officials and outside experts say the most likely path to revamping the health system is to begin with Medicare, the federal program for retirees and people with disabilities, and Medicaid, which serves the poor. Together, the two programs cover about 100 million people at a cost of $561 billion in 2007. Making policy changes in those programs — such as rewarding physicians who computerize their medical records or paying doctors for results rather than procedures–could improve care while generating long-term savings, expert say. It also could prod private insurers to follow suit.

Obama’s budget request would create “running room for health reform,” the official said, by reducing spending on some health programs so the administration would have money to devote to initiatives to expand coverage. The biggest target is bonus payments to insurance companies that run managed-care programs under Medicare, known as Medicare Advantage.

The Bush-era program has attracted nearly a quarter of Medicare beneficiaries to private health insurance plans that generally cover a package of services such as doctor visits, prescription drugs and eyeglasses. But the government pays the plans between 13 and 17 percent more than it pays for traditional fee-for-service coverage, according to the Medicare Payment Advisory Commission, which advises Congress on Medicare financing issues. Democrats have long complained about the cost, and eliminating the extra payments would save about $35 billion over the next five years.

Administration officials also are debating whether to permit people as young as 55 to purchase coverage through Medicare. That age group is particularly vulnerable in today’s weakened economy, as many have lost jobs or seen insurance premiums rise rapidly. The cost would depend on whether recipients were offered a discount or required to pay the full price of coverage.

As with the stimulus package, this show this is no small-thinking administration.

Brian Tamahana, in the category of “An Unjust World“:

The contrast seems bizarre: two public-minded elites subtantially underpay their taxes (yet earning nominations to Cabinet posts), while illegal immigrants duly pay their taxes (and authorities use these payments to track them down).

In fact the only time these two worlds seem to collide, is when public minded elites employ these illegal immigrants in their homes.

Naturally the Democrat in me causes me to get my back up when I read this…but on further reflection, it is kind of funny.