Also in the FT (good issue of the FT today) columnist Clive Crook suggests a tax compromise somewhat along the lines of that suggested by Larry Kudlow. Mr. Crook writes: "Extend all the Bush tax cuts for two years, but with a joint public commitment to reform the tax code before they expire with changes that a) broaden the tax base, b) cut marginal rates and c) raise more revenue."

Former auto tsar Steven Rattner has an op-ed piece in the Financial Times warning that American "income inequality has reached pandemic proportions." In the same piece, he writes:

The Federal Reserve's decision to embark on a second tranche of quantitative easing, known as QE2, was similarly well-founded.

In just the last few days, a number of blue-chip corporations such as Coca-Cola have launched large bond offerings to take advantage of low rates. That augurs well for capital investment, which was already on an upward trajectory in spite of business's stated fears.

If Mr. Rattner is so worried about income inequality, he should be criticizing the Fed rather than lauding it. After all, the low interest rates help big corporations with access to the bond markets such as Coca-Cola, in which Berkshire Hathaway, controlled by one of the richest men in the world, Warren Buffett, has a large stake. But they hurt small savers or retirees who have money in bank savings accounts, CDs, or money market accounts.

A professor of economics at the University of Chicago, Gary Becker, a Nobel laureate, has some suggestions for growing the economy and reducing the federal budget deficit:

The most important step in raising the growth rate is not to increase but rather to lower taxes on capital and entrepreneurship. This implies maintaining essentially all the Bush tax cuts, including those on capital gains and dividends, and those on incomes at all levels, including quite high incomes. The estate tax on very high levels of wealth could be reinstated if politically necessary, but it will only bring in a very small amount of tax revenue, and will be more costly than it is worth. Tax reform also implies a reduction in the corporate income tax, and especially reductions in taxes on incomes of small businesses.

The apparent extravagance of President Obama's post-election trip to India is raising some eyebrows, and some hackles. Britain's Daily Mail writes: "Probably not since the days of the Pharaohs or the more ludicrous Roman Emperors has a head of state travelled in such pomp and expensive grandeur as the President of the United States of America."

Drinking With Bob is not a fan of the trip, he indicates in his latest video.

The debate over what the Federal Reserve is doing to the dollar is heating up and moving into the political realm.

Over the weekend, the leaders of the Tea-Party-associated group Freedomworks, Dick Armey and Matt Kibbe, had a piece in the Washington Examiner arguing that QE2 favors the banks over consumers and taxpayers: "the Fed seems bent on propping up its Wall Street clientele by shifting ever more risk to the taxpayers."

Today the New York Sun has an editorial about how Sarah Palin is challenging Ben Bernanke.

David Warsh suggests President Obama choose Neal Soss.

From Jon Meacham's Bloomberg News column:

A Bloomberg National Poll conducted in late October found that by a 2-to- 1 margin, likely midterm voters think taxes have gone up, the economy has shrunk, and the billions lent to banks as part of the Troubled Asset Relief Program will not be recovered. Wrong, wrong, and wrong.

Facts, as John Adams said, are stubborn things. The purportedly anti-business Obama has presided over rising corporate profits and a successful rescue of the American auto industry.

Facts are indeed stubborn things, and if anyone is wrong, wrong, and wrong, here, it isn't the American voters, but Mr. Meacham.

President Obama's weekly address was on taxes: " I don't see how we can afford to borrow an additional $700 billion from other countries to make all the Bush tax cuts permanent, even for the wealthiest 2 percent of Americans. ...I want to make my priorities clear from the start. One: middle class families need permanent tax relief. And two: I believe we can't afford to borrow and spend another $700 billion on permanent tax cuts for millionaires and billionaires."

Supply sider Larry Kudlow interprets this as Obama backing at least a temporary extension of all the tax cuts, and writes that that is okay with him until a broader flat-tax type tax reform two or three years down the road.

Money manager Bill Fleckenstein on Bloomberg television, talking about the Federal Reserve: "We have a group of men who in old Politburo fashion, they sit around in a room and they try to guess what interest rate is right to run the world....These idiots think we can print our way to prosperity....It won't end well."

The Wall Street Journal has a fascinating interview with the president of the Federal Reserve Bank of Kansas City, Thomas Hoenig, the lone dissenter from the Fed's "QE2" decision. He says, "When all these very important decisions were made in 2003 to bring interest rates to 1%, it was because unemployment was 6.5% and thought to be too high. As a consequence of that — not immediately but in time — we now have 9.6% unemployment."

Someone else sent me a link to a Paul Krugman New York Times column from August 2, 2002:

National Public Radio's Planet Money has an excellent piece about the General Motors stock offering, observing, among other things, that the government is selling is shares at a loss, that GM itself warns that the government's ownership is bad for its business, and that GM itself says "our disclosure controls and procedures and our internal control over financial reporting are currently not effective."

This piece by Timothy Egan on "How Obama Saved Capitalism and Lost the Midterms," which I think just ran online and not in the print paper, has been the most e-mailed story on the New York Times Web site for the past couple of days. My favorite sentence in it is this one: "But more than anything, the fact that the president took on the structural flaws of a broken free enterprise system instead of focusing on things that the average voter could understand explains why his party was routed on Tuesday."

What a great summation of the left-elitist mindset. The big issues — TARP, the auto bailout/takeover, health care reform, stimulus, financial regulation — are all not "things that the average voter could understand," in Mr. Egan's view.

Here is a gem of a sentence from a news article on the front page of the New York Times: "Republicans also say they will try to deny money to put Mr. Obama's new health care law into effect, though they have not made clear what they would do to make up the cost savings that would be lost if they succeeded in repealing the law."

Only under the strange logic of Washington do you have to "make up the cost savings" when you decide not to spend money on something.

President Obama and the Congressional Budget Office claim that extending subsidized health insurance and prescription drug coverage to tens of millions more Americans will create "cost savings" over a 10 year period. That assumption is unproven and is contradicted by Massachusetts's expensive RomneyCare experiment, by assessments by the Medicare actuary, and by Congress's heaping on "doc fix" after "doc fix." Yet now the assumption seems to be taken for granted not questioned in the New York Times news coverage of the Republican takeover.

Texas Rangers pitcher C.J. Wilson was on ESPN radio earlier this week talking about his team's chances of re-signing its star pitcher, Cliff Lee:

If Boston offers him X amount of dollars and we offer him X amount of dollars, if it's the same, than he'll probably chose us over Boston. Because of the good times that he had and the fact that the state income taxes are negligible here.

Link via BaseballMusings.com, which notes, "All those Red Sox fans that voted against Question 3 on election day are going to be sorry when Boston loses Lee."

Those income inequality statistics from the IRS about how the rich got richer in 2009, cited in the Bob Herbert New York Times column mentioned here, turn out to be bogus, Bloomberg News reports, via TaxProf:

Two people were found to have filed multiple W-2 forms that made them into multibillionaires, an agency official said. Those reports skewed statistical wage tables, released Oct. 15, and made it appear that top earners in the United States had seen their pay quintuple in 2009 to an average $519 million each. The agency today released corrected tables that showed the average incomes of the top earners, in fact, declined 7.7% to $84 million each.

Oops. It'll be interesting to see whether the Times corrects Mr. Herbert's column, or whether Mr. Herbert changes his opinion, based on the new data.