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Pearlstein: Competitive Markets vs. Public Sector

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Steven Pearlstein
Washington Post Columnist
Wednesday, June 11, 2008; 11:00 AM

Washington Post columnist Steven Pearlstein was online Wednesday, June 11 at 11:00 a.m. ET to discuss why our adaptive and innovative competitive markets are capable of producing new products like the iPhone, while the public sector is slow, uncreative and unadaptive in responding to urgent issues like the housing crisis or financial regulation reform.

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A transcript follows.

About Pearlstein: Steven Pearlstein writes about business and the economy for The Washington Post. His journalism career includes editing roles at The Post and Inc. magazine. He was founding publisher and editor of The Boston Observer, a monthly journal of liberal opinion. He got his start in journalism reporting for two New Hampshire newspapers -- the Concord Monitor and the Foster's Daily Democrat. Pearlstein has also worked as a television news reporter and a congressional staffer.

Pearlstein was honored with the Pulitzer Prize for commentary for his columns about mounting problems in the financial markets. His award was one of six Pulitzer Prizes won by The Washington Post this year.

Read Pearlstein's latest columns.


Oviedo, Fla.: All this talk of upgrading - or initially embracing - smartphones makes me wonder about the fate of all the current cell phones most of us have. Is tossing them into a recycle bin at Radio Shack the best thing to do with them? Aren't about 30% of U.S. Americans still without cell service? How can we get at least basic portable telephones to those too poor for them, with credit too marginal for a contract, etc.? With cell now a tiered commodity can't we make sure everyone has a pocket that rings?

Steven Pearlstein: Not sure the handset is the key barrier to low income people having cell phones. It is the monthly service charges and credit, although you can buy phone cards to deal with that to some degree. Not sure it is a big problem, however, although I would say that the disappearance of the pay phone is sometimes an annoyance to those of us who don't usually carry a phone.


Arlington, Va.: Why is it that when the price of a barrel of oil rises so do gas prices, but when the price of a barrel of oil drops gas prices do not?

And also McCain is proposing his "gas tax holiday," but wouldn't the oil companies just raise prices to make up for all or most of that "holiday" and just keep the money for themselves?

Steven Pearlstein: Not sure your intial observation is correct, although there are susupicious lags on the way down that suggest the system is not fully symmetric when it comes to gasoline prices reflecting oil prices. Also, you have to remember that the markets for refined oil (gasoline) are regional and have their own supply and demand characteristics apart from those of the global oil markets.


Alexandria, Va.: Steven, I don't think its just the Senate rules that make responsive legislation difficult. The entrenched interests that you cite in your column have a lot more money to spend on candidates than the good governance think tanks. Public funding of campaigns would remove one disincentive to responsive legislation.

Now, if we could only figure out how to get people to vote for candidates that introduce and promote effective and responsive legislation, instead of the candidate that has better hair.

Steven Pearlstein: Obviously special interestes have, and have always had, undue influence on the process through bribes and campaign contributions and the like. But if you think about it, difficult issues are likely to be decided by votes of 55 to 45 in a body of 100 Americans and the constitution says they should be, in favor of the party that gets 55 votes. But that doesn't happen because of the Senate rules, which are self imposed.

Starting in November, I am going to begin a relentless campaign in my column urging the new Senate to change its rules when it organizes on Jan. 2. This has really become the most important political issue in the United States, in my opinion, because it affects all the others. And it has been largely ignored in the sense that everyone believes there is nothing we can do about it, that somehow these rules were handed down by God from Mount Sinai. They were not. It is a classic example of people tying themselves up in their own underwear.


Chicago, Ill.: Hey Steve, what lessons from Hyman Minsky could we learn about the present financial crisis?

Steven Pearlstein: Wow, a Hyman Minsky fan. We can learn everything from Hyman, since he basically understood that periods of prosperity and financial calm always lead to a deterioration of underwriting standards in loans and stocks that leads to bubbles that burst. He laid it all out years ago, and most economists treated him as a liberal, anti-market crank. You don't hear that now, however.


Frederick, Md.: I have this fantasy that at their first Town Meeting, Barack Obama will say to John McCain: "John, the problem in Washington is that the parties and special interests are so hidebound that solving problems has become impossible. Neither side wants to give an inch, so critical problems are allowed to fester, rather than find a compromise that moves us toward policies that will do what we all know needs to be done. Here's my challenge to you: Let's not wait until January to try and break this cycle. Let's you and me go back to the Senate tomorrow and jointly propose a bill that allows for drilling in ANWR and off the coasts plus a windfall profits tax. You bring the Republicans to support the tax and I'll bring the Democrats to support more drilling. Neither of these choices will end the world, they may not even bring gasoline prices back to a tolerable level, but they'll show that we're going to change the way Washington does business. It will be a great way to show the American people how we can lead and a test of our abilities to actually get things done in a way that will make a difference for the American people. So let's do it tomorrow. How about I come to your office at 9:00 a.m. and we work out the details?"

Okay, I know what you're thinking: I need to get a better fantasy life. But I do think it just might work.

Steven Pearlstein: I don't think that's a fantasy at all. First of all, I proposed exactly what you just did years ago, and have repeated it several times. More drilling, more pipelines, and higher taxes (mostly through closing loopholes and subsidies to oil drillers). I'm there, man. But good news: so are certain members of the Senate, who are working on just such as deal as we speak. Stay tuned.


Silver Spring, Md.: Hey Steve. A couple weeks back you had a column about the inevitable re-adjustment of our American standard of living back to something sustainable and realistic. For the past decade, the rich/poor gap has been increasing at an astounding rate and I think there hasn't been big time political fallout yet largely because of that inflated, unsustainable standard of living that you wrote about. Big business, executives and politicians have pretty much said to Americans: "Sure I'm making 150x what you make when 30 years ago that was 13x... but look at all this cheap junk you can buy at Walmart.. After all, the number one sign of American prosperity is a house full of junk!" Now that we're going to see a readjustment to reality in the next decade, with oil prices sky high and while maybe bubbling now, certainly not coming down too much... that whole wildly limited resource side of supply and demand we like to ignore and all... food prices quickly following, imports getting expensive as big-bank interest-rate bailouts continue to drive the U.S. dollar into oblivion... Are those "look at all this cheap junk at Walmart!" arguments going to fly anymore? Or is there finally going to be some political backlash against these big-business friendly politicians (repub's AND dem's!) for pursuing a decade of policies directly benefiting business and rich folk?

Steven Pearlstein: One fundamental problem with your argument: public policies are not the primary driver of income inequality. How do I know? Because roughly the same thing is happening in Sweden and France and Japan and places that have public policies that are like the ones you and other liberals prefer. Now it is true that we could have policies that do a better job at mitigating or compensating for what the private markets are doing, and we should consider those. I've written about many of those. But it is important in this debate not to blame public policies for causing income inequality, because that will lead you to bad fixes.


Laurel, Md.: Just two unrelated comments:

1. iPhone service is now $70/month. I'm surprised they don't give away the things for free with a two-year commitment. (And being a T-mobile customer who pays $100/year for 1000 minutes of voice, it will be a LONG time before I get one.)

2. I wish I could come up with more examples, but doesn't the government's stodginess sometimes keep it from getting swept up in silly trends? Like the proposal from the 2000 election to link Social Security to the stock market?

Steven Pearlstein: As to your second question, the privatization of Social Security couldn't even get 50 votes, let alone 60, so it wouldn't have passed even without the arcane Senate rules. And if we make mistakes like that, the good thing about a flexible system is that you fix them. The idea that our public policy apparatus should never make a mistake is a fallacy, just as any business executive would tell you: If we don't make an occassional mistake, then we're not taking enough chances and experimenting with enough new ideas. The trick is to be honest enough when it turns out what we thought would work doesn't, and quick enough to change it before it becomes hard wired into the system. That's a distinctly American characteristic that serves our businesses well in global competition. But in government, we're losing the knack.


New York, N.Y.: Hi Steve,

Good column, but I wished you would have talked about how municipal unions (in concert with state & local governments) are driving states and cities to the brink of disaster (see Vallejo, California) and its only going to get worse.

Although the private sector has at some times been ruthless in holding down pension and medical costs, at least the private sector is trying. The public sector seems willing to do absolutely nothing to address this mushrooming problem.

In New York City police officers can retire with half salary and full lifetime medical coverage after 20 years on the job. You ultimately have armies of 40 year old retired men on the public dole. This is a prime reason why my state and local taxes are 11%, the subways and schools are crumbling, and water main breaks are in abundance.

Steven Pearlstein: Not sure how, as a writer, I was going to segway from smart phones and patent reform and senate rules into municipal pension reform, but I suppose its only a lack of imagination on my part. As to the issue, it is a real time bomb that is about to explode in municipal budgets, there is no doubt about that. And we need to stop adding to the problem by moving away from these lavish pension programs and using at least some of the savings to increase hourly pay.


Ashland, Mo.: What would happen if Congress passed a law declaring that it is a breach of fiduciary duty to invest in any commodity futures instruments?

Steven Pearlstein: We could certainly pass rules saying that it would be a breach to exceed a certain percentage of a portfolio, or to use too much leverage. And we could certainly increase margin requirements. That would be a start.


Rocky Mount, N.C.: A technical question on oil. If you go to www.eia.doe.gov, you can find all of the info you want on U.S. oil production, OPEC imports, and non-OPEC imports. In March 2008 (its latest data), the U.S. produced 5.1 million barrels of oil per day, 1.8 million of which were exported. From OPEC, we imported 5.9 million barrels per day, with the main countries being the Saudis (1.5 million/day), Nigeria (1.2 million/day), Venezuela (1.0 million/day), and Iraq (773k/day). From non-OPEC, we imported 6.6 million barrels per day, with the main countries being Canada (2.5 million/day), Mexico (1.4 million/day), and Russia (400k/day). So our grand total for imported oil in March 2008 12.5 million barrels per day. It has data going back to 1973 for the monthly imports. We've been in the range for 12-15 million barrels per day fluctuating both ways since December 2003. You can also see our oil production since 1920. Domestically, we peaked at 10 million/day in November 1970. We touched 9 million in 1986 and it's been downhill from there, and we're only 60% of that 1986 level today.

First, all those derricks that produced oil in the 1970s and 1980s are still there and still approved, why aren't their owners opening them up? Second, OPEC I think is made more of a scapegoat by domestic economists. The only people we get big oil from there are the Saudis (who we're "friends" with), Nigeria, Chavez (who we're decreasing our receipts from him looking at historical data), and Iraq (who we're "newly friends" with). A majority of our oil is non-OPEC, and we receive more oil from Canada than we do the Saudis and Mexico is about the same as the Saudis. Heck, we receive more oil from the U.S. Virgin Islands than Kuwait, and we went to war for them! Third, at the same site, our refinery utilization and capacity in March was 83.2%. That was our lowest refinery utilization since 2005 and the normal level is 92-95% from previous data. I understand maintenance and breakdowns and all that, but you'd think at higher prices it would be higher, why not? If I were an investor, I think I'd build a refinery. But existing refineries and oil companies are not interested in one being built, why not? It's easy money.

Steven Pearlstein: That's a mouthful and, as readers of this column know, I'm not a believer in peak oil. But as to your question of why nobody is building refineries, the answer is staring us in the face: The handful of oil refiners who are left like having an oligopoly and like having very tight supplies and it is not in their individual or collective interest to try to increase profits and market share by increasing supply, because there is too much of a danger that it will lower the price and ruin it not only for themselves but for all the other refiners. So they engage in a form of collusion, all tacitly agreeing not to build a new refinery or add too much capacity to existing refineries.

If our government was serious about this, it would pre-approve a refinery plan on appropriate pieces of federal land (decommissioned military bases) and invite companies to bid on the right to build there. And if nobody responded, the governmennt should set up a publicly chartered company to do it itself. Fannie Mae for gasoline, or something like that.


Re: Inequality in other countries: While other countries have seen their inequality go up in the last 30-40 years, they haven't seen the spike that we have, not as quickly, not as sharply, and those countries are more open to talking about inequality problems without "class warfare."

Steven Pearlstein: Not sure you're right about that. Let me give you one good example: one of the most significant drivers of household income inequality (and there are lots of measures, so you have to be careful here) is that highly educated people are, more than ever, marrying other highly educated people, while poorly educated people are more likely to marry down or not be married at all. Now I'm not aware of any government policies that are really driving that phenomenon. But it is a huge part of the inquality story.


Anonymous: A recent segment on the PBS NewsHour indicated that the best employment market for recent graduates was in the health care, education, and government sectors. This made me wonder if the creative entrepreneurial corporate spirit that I identify with our country is at risk of being taken over by government run or regulated institutions. What do you think?

Steven Pearlstein: No, I don't think so.


College Park, Md.: Hello Steven,

Montgomery County (and presumably other counties, states etc) want to raise taxes during a recession.

How dumb is that?

Steven Pearlstein: Actually, they have no choice. They either have to raise taxes or reduce services, and through their elected representatives, they've chosen to raise taxes. There is nothing inherently bad about that, particularly at the level of municipal government, whose fiscal policies are just too limited to affect the economy of the larger region or the country.


York, Penn.: I'm also a holdout from smart phones. One of my big hangups is the awful keyboard.

Steven Pearlstein: Yeah, but on the touch screen keyboards, its better.


Falls Church, Va.: I asked you a few months ago whether you thought the addition of the Dulles/NoVa stations would be overbearing to the current infrastructure and trains that exist right now, especially for downtown stations.

You said it was nonsense. I guess you were wrong. So many people are now turning to a public transportation system that's already overwhelmed and will get worse and I don't foresee Metro getting any more funding sources for relief.

Jampacked transit systems running on fumes

Steven Pearlstein: I don't think I said that there isn't a problem with the capacity of the existing trunk line on the Orange Line. There might be, although the planners have obviously considered that and feel they can deal with it. But if so, there is nothing in the laws of nature that prevent us from increasing the track capacity of the orange line. It will have a cost associated with it, but that is the kind of problem you want to have in public transit -- too many paying customers wanting to climb on board.


Re: Frederick's Fantasy: Tie the drilling to a cap-and-trade program, not windfall profits tax. The latter is just fundamentally unfair.

Steven Pearlstein: I'd prefer to tie it to a carbon tax and keep things simple.


Washington, D.C.: Mr. Pearlstein: Thanks for your as-ever thought-provoking column today. Two quick points. 1. Might the difficulty of getting things through the Senate prevent more disastrous legislation than disastrous lack of legislation? 2. Some of us are willing to drill more, but not everywhere. Given that the total lack of a coherent energy policy in this country makes these choices difficult, do you not still agree that some places should be off limits, at least in principle?

Steven Pearlstein: In principle, yes. I don't like a lot of the drilling that has been proposed for the mountain states, where there is a lot of damage to the water. But drilling for natural gas in the Gulf of Mexico and off California, and drilling for oil and gas in limited areas in Alaska, including ANWR -- I can live with that, assuming the environmental controls are good.


Washington, D.C.: Concerning the outrageous paydays that some CEO's enjoy after being dismissed for running a company into the ground... In many cases the search committee for the failed CEO finds that the finalists are all, or mostly senior company employees/executives. GE is a recent case in point. In this case at least it seems to me that the hiring authorities could drive a bargain such that obscene payouts for poor performing CEO's, and those who are forced out, could be avoided

Steven Pearlstein: That would seem logical, wouldn't it.


Tampa, Fla.: When discussing the public sector, you have to distinguish between its two parts: elected public officials, and career civil service and other ordinary workers. The former is unusually effective at handcuffing the later. I worked in the Treasury Dept. and saw this first hand.

Consider financial regulation. Congress has always short-changed the SEC in its funding, and deliberately so. Thus, the SEC has always been short of resources. As the number of public companies skyrocketed, the number of employees at the SEC remained stagnant. It's no wonder the SEC was in no position to prevent corporate scandals like Enron, WorldCom, and AIG.

Take the IRS. The Service started auditing small business for improperly classifying workers as independent contractors instead of employees. This relieved the employers of their share of FICA tax and allowed them to deny benefits to the workers. The IRS started winning cases. So Congress jumps in and forbids the IRS from auditing this issue. Even worse, Congress creates a special "Everyone Does It" exception. That employers in a specific industry cheat on this issue is allowed as evidence that it's legal! Could you or I do this were we to argue that the income tax is unconstitutional? No way.

As for scientific innovation, keep in mind the creations of the public sector: the internet, jet aircraft, all the discoveries of NIH, the Defense Advanced Research Projects Agency (DARPA), and NASA.

So gov't can innovate. But when it comes to industries that contribute money to political campaigns, Congress hates regulatory innovation other than giveaways. It's not difficult to imagine how Congress would have reacted if, 3 years ago, the SEC or another agency tried to crack down on sub-prime lending. Congress would have handcuffed them faster than you can say "Thanks for the money, Mr. Lobbyist."

Steven Pearlstein: Thanks for that. But as I said, even above and beyond the pernicious effect of money on the legislative process, there is no need to compound the problem by giving the special interests an advantage of only having to round up 40 votes on close issues. That's a recipe for stalemate, which is what we have now.


Danvers, Mass.:"Unless we recapture that ability to make Washington work again, it is a pretty good bet that, a generation from now, the next new thing will be developed somewhere else."

A good question might be just how much of the iPhone is U.S. developed, or California developed, or Steve Jobs developed. You mention "Palm, Nokia, Samsung, Research in Motion, Google and Microsoft" also, three of which are foreign.

What's the tangible connection between "free markets" and innovation?

Steven Pearlstein: Yes, some of those are foreign companies but some of the work done by those foreign companies is right here, in their biggest and richest consumer market.

I think the literature is pretty clear that there is a link between the openness and flexibility of markets (product, labor, financial) and the pace of innovation. Obviously, you have to have other things in place, like a good patent system and good education and no wars. But there is a reason, for example, that the US became the locus of pharmaceutical innovation as the center of gravity moved away from France and Switzerland and England.


McLean, Va.: Steven,

Doesn't the commercial sector have an analogous problem to the government sector: the inbred, entrenched, interlocking corporate boards and corporate management? What percentage of shareholder sponsored initiatives do the boards recommend for approval? I'd be surprised at any percentage greater than zero. Then there is the weighting of various types of shares and the default counting of undeclared proxy votes. Finally, there is the entrenched idea that executive mangers are so rare and so valuable that they must be offered outrageous compensation packages that make them kings if they succeed and princes if they fail. I say it's time to storm that castle, too.

Steven Pearlstein: Sure, the private sector has its problems. Doesn't mean government can't learn something from it, however.


Boston, Mass.: Another oil question- all this "cost per barrel of oil" talk, let's assume that the refining cost (the oil companies piece of the pie, not the oil producer) is 10%. When oil was $20 a barrel the cost was $2 per barrel. At $120 it becomes $12 per barrel. Have refining cost increased a corresponding 600%? Same hold true with profit margins argument, "we only make 2% per barrel.

Steven Pearlstein: There is a problem with using percentages, since the actual out of pocket cost for refining a barrel of oil, excluding the oil, doesn't change. But at the moment, refiners margins are actually being squeezed, so this isn't really working against the consumer interest at the moment. It's complicated, but let's say that the windfall -- and it is a windfall, make no mistake about that -- is going to the people who control the crude.


Re: Refineries: I'm not disputing your conclusion about why refineries don't get built. But I've always heard another issue is the onerous regulations (OSHA maybe?) in place for building new refineries, which are much more strident than those for expanding older refineries. Any comment to that?

Steven Pearlstein: Refineries have lots of regulation and lots of community opposition, so they are a pain in the butt to build and run. That's just a given. It's because they are dirty and dangerous and its just a cost of doing business. But if you've invested in that business lately, you'll know its worth it.


Bowie, Md.: Steven, don't know how much of a conspiracist you are, but do you remember two summers ago, the price of gasoline dropped to about $2.00/gal in time for the November elections, and then went back up starting the following February?

Would you expect the same sort of thing this election?

Steven Pearlstein: I wouldn't count on it. But we are in the middle of an oil bubble that could burst any time, and its certainly not out of the realm of possibility that the price of gas could go back to $3 in the medium term.


Rochester, N.Y.: McCain's chief economic adviser is Phil Gramm, who wrote the legislation that gave rise to both Enron AND the subprime crisis in the minds of many observers. Gramm was also a lobbyist for UBS, which is under criminal investigation and was also a major subprime player.

This should be an important issue, right? How come no one is talking about it except the blogs?

Is this another example of the mainstream press chasing haircuts and reverends while the blogs tackle the serious issues?

Steven Pearlstein: No, its an example of the mainstream press not jumping to conclusions and engaging in guilt by association. But you're right that some inquiry needs to be done as to Gramm's influence on the campaign and whether he's shown the best policy judgment in the past. Among his other contributions, for example, is the Enron loophole that allows much of the speculation on commodities to go on on unregulated over the counter markets. Now it looks like that is contributing to the commodities and oil bubbles. Wonder what Phil (and McCain) have to say about that.


College Park, Md.: Good morning! Any thoughts on the decision of Inova & Prince William Hospital to not go forward with the merger (thus giving the FTC its first success in blocking a hospital merger in over 15 years)? Thanks!

Steven Pearlstein: I think we got the right outcome. Now Prince William will have to resume its search for the right partner, one that can give it the scale and access to capital it needs without substantially reducing the prospect of competition. There are better alternatives, if they are only willing to look a little harder and more creatively.


McLean, Va.: When, say, Goldman Sachs issues a report about oil going to $200, how much credence does it deserve? To what extent should I just assume that means Goldman is long on crude?

Steven Pearlstein: Goldman is making lots of money on people investing in the Goldman Sachs Commodity Index. They are talking their book, as they say on Wall Street.


Troy, N.Y.: Hi Steve. Way off topic, but I'm a chemical engineer, and it's already been mentioned. I own stock in an integrated oil company. During presentations I see time and again that their refinery business is a drag on the bottom line. I think that is the incentive that keeps them investing money elsewhere (whether it is buybacks or dividends or new production).

Steven Pearlstein: There was a period in which refinery profits were lousy. But excess capacity has gone away, there has been a lot of consolidation, and that period seems to be behind us now.


Alexandria, Va.: In your article today, you say that "All this is a glorious example of how free markets are supposed to work: fostering innovation, increasing productivity, driving down costs, creating jobs, generating wealth and improving quality of life. It is a case study of what people can accomplish in a relatively short time when a sense of competitive urgency forces them to think creatively and focus on pleasing and delighting customers."

While I agree that advances in phone/PDA tech are wonderful, I disagree with that last part about "pleasing and delighting customers." With the partial exception of Apple, most people would happily throttle anyone associated with the cell/PDA provider for their so-called "customer service."

Yes, customers (and the market) love innovation. But they'd also like service that works as advertised, with a minimum of hidden "gotcha" language and more freedom to use Phone A with Carrier B (see the iPhone and AT&T).

Then again, since people put up with it and do nothing but grouse, are those things not valued in the market, and ultimately, by customers?

Steven Pearlstein: I'm sure there are problems with the customer service. But you wouldn't see the tremendous growth in this area if, on balance, customers weren't getting benefits that exceeded costs and inconvenience.


Freising, Germany: I have to say that I can appreciate the concept of, "it's time to let go of this inner Luddite." But what does your inner Luddite tell you at the moment of environmental challenges?

I agree that free markets can foster innovation, increase productivity, drive down costs, create jobs, generate wealth and improve quality of life, etc., but I often wonder if market forces can solve environmental dilemmas without governmental intervention.

Steven Pearlstein: No, it is a well understood principle in economics that markets do not do a good job, by themselves, of pricing externalities, and that in those cases, government intervention is necessary. That's not an argument for why all markets are bad in all cases. Sorry.


Helena, Mont.: Boy, you want to throw the baby out with the bathwater just because you can't bring yourself to criticize the Republicans. The 40-vote rule in Senate has not been an issue in the past but has been with McConnell as minority leader because he uses it on all legislation. In the past, legislation could be passed on simple majority vote - which is why VP could break a tie.

Steven Pearlstein: McConnell has obviously ignored Senate tradition by using the role to stop consideration of just about everything. But criticizing McConnell is like criticizing child pornography -- its too easy and doesn't accomplish anything. We need to deal with the rule itself. McConnell is unreformable.


Re: Filibusters: I've always thought that the Senate should maintain its filibusters with one giant exception: let the House be able to override the filibuster and force a vote. That's what Great Britain did in the 19th century when the House of Commons decided that the House of Lords was being obstructionist in order to protect vested and counter-majority interests. Could that work here?

Steven Pearlstein: Suppose so, but it really runs against our consitutional tradition of letting the houses operate separately. Better just to scrap the 60 vote requirements, which in my opinion are patently and blatantly unconstitutional.


Seattle, Wash.: Great column about how the market is working to provide us better stuff cheaper as far as cellphones go, but you missed a key point: the companies involved largely agreed to not let copyrights get in their way. Imagine if IBM had decided that the iPhone's OS resembled an OS that they had a copyright on. It'd be 2020 by the time that case got settled.

Steven Pearlstein: That is a key point. Thanks for adding it to the discussion.


Va.: Steve,

You have to name names. It's not an undifferentiated block of faceless entities, the Senate. There's only 100 people in it. If you want to help move things along, don't tar everyone with a brush as "typical Washington". Single out the senators, who have NAMES and PARTY AFFILIATIONS, who you believe are blocking progress, and criticize them. You might help inform readers who could, through their letters or votes, change the Senators' minds. Use your platform, bud. Don't be afraid to get on the S--- list of a few legislative dead-enders.

Steven Pearlstein: Trust me, I'm on the S--- list of lots of senators, Republican and Democrat. These days most of the obstructionists are Republicans, given the Democratic control of the chambers. But the same would have applied to Democrats in the past. We've just got to get comfortable with majority rule again.


Baltimore, Md.: Re: stalemates in the Senate: One of the most pernicious developments in the last 25 years or so has been the development of the non-filibuster filibuster. Senators who didn't like legislation had to literally get up in the chamber and talk it to death, or risk losing by a simple 51-49 majority vote. Now, unless you have 60 votes, a successful filibuster is presumed to have happened. Why did the Senate go this route and how can we get back to the old days of watching Senators read the phone book on the floor of the chamber?

Steven Pearlstein: My sentiments, exactly. I think Harry Reid has been a willing partner in allowing the Republicans to tie up the chamber. It would have been good politics for the country to see Republicans tying up the entire government on behalf of narrow special interests.


Steven Pearlstein: That's all the time we have today, folks. "See" you next week.


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