MS. DIANE REHMThanks for joining us. I'm Diane Rehm. The first order of business for House Republicans in the 112th Congress is to make good on a campaign promise, vote to repeal President Obama's health care overhaul. Joining me in the studio to talk about issues on the U.S. domestic agenda in 2011, including deficit reduction, job creation and immigration reform, E. J. Dionne of The Washington Post, David Brooks of The New York Times and James Thurber of the American University. We do invite your comments, questions, 800-433-8850. Do send us your e-mail to drshow@wamu.org. Join us on the newly wealthy Facebook or Twitter. And good morning and Happy New Year to you all.

MR. DAVID BROOKSHappy New Year to you.

MR. E.J. DIONNEHappy New Year to you.

MR. JAMES THURBERHappy New Year to you.

REHMDavid Brooks, 2010 was a mightily contentious year. Are we to expect another in 2011?

BROOKSYou ain't seen nothing yet. You know, I think, barring some big, really new event, this is going to be the year of a big debate over the size of government. Republicans are going to come in and say, we want to cut $100 billion from the current budget and then really transform entitlements and all the rest. Democrats are going to rise to the defense of government. And so we're likely to have a big debate on this large philosophical issue.

REHMJames Thurber, how do you see it?

THURBERI see a battle over trying to create jobs and turn the economy around and health care repeal, but also the scope of spending, deficit reduction and debt. I think the commission on deficits and debt is helping to set that agenda, and it fits in with the Tea Party movement philosophy that they want to shrink government. They want to go after those entitlements.

REHMWhat about raising the debt limit, E.J.?

DIONNEWell, it's going to happen eventually because otherwise, the United States is in big, big, big, big trouble. I want to begin by saying I welcome the new Republican Congress. I welcome accountability. I welcome a greater clarity in the debate. I welcome this -- you know, people being -- learning what this brand of conservatism stands for. And I even...

BROOKSDoes that mean you voted for them (word?) ?

DIONNEAnd I even welcome their effort to repeal the health care law because, I think, it's a big mistake from their point of view. I -- you know, the debt ceiling is going to be fascinating because this usually goes through routinely. I do not recall Republicans opposing debt limit increases under President Bush, yet they're going to now use it as a lever to try to extract cuts in government programs. And, I think, what's going to be good about this period is that when the Republicans are in the opposition, it's not unique to them.

DIONNEWhen Democrats are in the opposition, they weren't held all that accountable for what they stood for. Now that they control the House and Congress, they're going to be held accountable for the cuts they want to make to justify the tax rates they want to have. And that's a good debate for the country to have. We need to have that clarity.

REHMAnd, of course, James Thurber, under President Clinton, Newt Gingrich did take that one to the limit, shut down government. How did that redound?

THURBERWell, they shut down government, and New Gingrich was hurt. The Republicans were hurt, and President Clinton won in that. And I think the Republicans, and, certainly, Speaker Boehner remembers that. And they will not do that again. But I think there will be a massive struggle over cutting into the budget. Most of it is uncontrollable because it's net interest and entitlement programs. And if they try to cut out $100 billion in the next few months, it's going to hurt a lot of people.

REHMDavid Brooks, how willing do you think President Obama is to compromise?

BROOKSI think he's pretty willing, at least on some things. We're going to have some things that will be -- there will be no compromise, health care and things like that. But I think they're of a mind to create a fence around those issues and try to create other issues upon which they can actually compromise. I think, the president in the State of Union, his main emphasis will be on growth. If the Republicans are going to be about cutting spending, President Obama's emphasis will be on growth, but, I think, he will also have some deficit reduction in there. He watched the election results like anybody else.

REHMLet's hear what he had to say in terms of his own resolution.

PRESIDENT BARACK OBAMAAnd our most important task now is to keep that recovery going. As president, that's my commitment to you, to do everything I can to make sure our economy is growing, creating jobs and strengthening our middle class. That's my resolution for the coming year.

REHMNow, E.J., what do you make of that? Can he work with Republicans to make sure that happens?

DIONNEMaybe, but I think what he's really doing is setting up a pretty good standard by which to judge what the Congress is doing, and that -- what he's saying is, if what they are doing will actually help create jobs, I'll be for it. If what they're doing is going to hurt job creation, I'll be against it. And, you know, there are some areas where they may -- well, be able to work together. I think there is some bipartisanship on education. There may be even some bipartisanship on a modest energy program. President Obama has proposed an infrastructure bank, which is a good idea. I think there's -- that's an issue that could split the Republicans. But there are a lot of areas where Republican cuts will not be good for the economy. Certainly, Obama will be able to argue that, and I think that's where he wants to join the debate.

REHMLet's hear what Senator-elect Kelly Ayotte of New Hampshire said, giving the GOP's first weekly address of 2011.

SEN. KELLY AYOTTEThe American people sent us to Congress with clear instructions, make government smaller, not bigger, and stop spending money we don't have on programs that aren't working. It's now our responsibility to carry out the will of the people.

REHMDavid Brooks.

BROOKSWell, these two agendas are not necessarily in conflict, or, at least, there are some areas where they can overlap. I think both parties emphasize growth, and it's not the short-term growth we've been talking about over the last two years. It's long-term growth. And I think both parties are open to the infrastructure, open to some of those spending, open to free trade. And so, I think, there's some areas where you can increase spending on things that will lead to productivity increases, and then cut spending on things that lead to current consumption, including consumption of health care.

BROOKSAnd these two things can go together. I'm not sure it will go together politically, but I could fashion agenda. I suspect you could take Paul Ryan from the Republican Budget Committee and Barack Obama, sit them in the room, and they could fit together a pretty decent agenda combining what both of them want.

DIONNEI disagree with that. I think, David, on the Ryan budget, this is a very radical budget. I do hope we debate it because, I think, there are such deep cuts in there and such deep cuts in taxes over the long run, that you can't really finance the kind of investments said that, David, as a kind of whiggish Republican -- I say that with great respect -- is in favor of -- just on that Ayotte speech, I thought you played exactly the right sound bite. Stop spending money we don't have on programs that aren't working.

DIONNEI don't know of anybody except, perhaps, some narrow group that profits from a program who believes in spending more money on programs that aren't working and that -- again, that's why I welcome this clarity. That kind of rhetoric has been very useful to Republicans. Now, they've got to show us what they mean by it.

REHMNow, James Thurber, what there has been a great deal of talk about is overturning President Obama's health overhaul. How realistic do you think that effort could be?

THURBERWell, I think, it's going to be one of the first votes out of the House of Representatives, and it may, indeed, pass the House of Representatives. But there's this little problem. We have a Senate, and you need 60 votes to overcome a filibuster that would be related to this. I think, secondly, they'll probably attack the regulations that are being promulgated out of the health care reform, and also try to put writers' provisions in appropriations bills to cut back on appropriations for regulations but also de-authorize certain things.

THURBERNow, again, the Senate has to agree, and the president can veto these things. I don't think they have a two-thirds vote. So, I think, there'll be a lot of oversight. It's going to be the oversight House of Representatives, oversight over the implementation of this, as well as the EPA regulations and other regulations that they're upset with.

REHMWhat about the health care lawsuits, David Brooks?

BROOKSWell, the -- first of all, on the health care bill, overall, a lot of Democrats who've been very upset with the Senate over the last two years are suddenly going to discover the virtues of the Senate procedures in the filibuster. And -- but I think what's going to happen is, there will be this more or less symbolic vote to repeal, which will fail either -- probably in the Senate -- but certainly with the presidential veto. But then there will be the other things that will go on.

BROOKSThe lawsuits will crawl along, and that will be up to what Anthony Kennedy feels like on any given day about the health care law. But then the second thing of the action will be in the states, so a lot of states would try to opt out of various provisions. And members of Congress will move bills to try to translate power away from Washington to the states to give them more power to control the measure and, in some states, undermine it that way.

DIONNEThe -- just on this vote on the health care law in the House, it's a very interesting choice. It could mean that Republicans know they're going to fail on this. They want to get it out of the way, and they are giving that to their Tea Party base. And then they'll try to chip away at it in indirect ways. But the reason, I think, it's a mistake for them to do this is two-fold. One is they are putting the Obama agenda at the center of everything, and they're saying, we're really reactive to the Obama agenda.

DIONNEAnd this is not exactly a call for bipartisanship. There is some mood in the middle for bipartisan cooperation. They make it a little easier for President Obama to say, look, I'd like to cooperate with them, but the first thing they do is slap me in the face on this. The other thing is defenders of the law get another chance to defend it. They didn't do a great a job at that in the two years, so I think it's good to re-debate the health care law.

BROOKSThe Republicans won the debate. They won that election, at least politically. Why wouldn't they want to have it again? You know, I think it would be a mistake for them to spend the next year doing it because people do care about the economy fundamentally. But I do think this is a great issue for them. It remains unpopular. It's become more unpopular the last two months than it was even before. Just politically, in the short term, a pretty good debate for some.

DIONNEThe specifics are popular.

THURBERYes. It's unpopular. But when they start seeing the specifics, they'll find that they like it, and they didn't realize that it was in it. It's a very complex bill. I think that the Republicans would like to focus on jobs, the economy, scope of government spending and deficit reduction. And health care is there, but it wasn't the primary issue -- I don't think -- in the last campaign.

DIONNEThe other thing that's worth noting is they're repealing this. They're not putting -- they said repeal and replace. They just want to repeal it. They should have a proposal of their own.

REHME.J. Dionne of The Brookings Institution. He's also a Washington Post columnist. Short break, and we'll be right back.

REHMAnd we have our first e-mail from Tim in Baltimore, who said, "Darrell Issa recently called the Obama administration the most corrupt in history. This statement does not bode well for the upcoming Congress." David Brooks.

BROOKSWell, there is nasty words in politics. Obama called the Republicans, hostage takers. You know, I think it's factually, completely untrue. It's completely -- obviously, an absurd statement. These statements happen. I would say if you talk to Republicans, you know, they feel very confident. They feel the president has to come to them. They won the election. They may be a little more confident than they deserve to be, but I don't detect a visceral hatred of Obama. They think he's wrong on the issues, and I don't think there's a vitriolic feeling right now in the Republican Party. There's a confident feeling...

REHMHmm.

BROOKS...that the public is on their side.

REHMBut why would Darrell Issa use that kind of language, James?

THURBERHe used it once in September, and he's never used it again. And if you say -- if you look at what he's saying now about his oversight, from his Committee on Oversight in the House of Representatives, he's going after fraud, waste and abuse. He's not going after criminals in the White House. His language is moderated. When you start governing, you do that. And I think that you'll see that he will never say that again.

REHME.J.

DIONNEI don't know why he doesn't back off his use of that word, corrupt. I mean, there really is not evidence of corruption by any standard definition. What he's trying to do is redefine it and say, well, if the government spends all this money, then there's naturally some corruption. There's some -- that was his argument. I think it's very unfortunate that he felt obliged to reiterate the word, corruption. You need evidence when you use a word like corruption.

THURBERYou know, he's really talking about fraud, waste and abuse with Medicare to a great extent. He has an estimate of over $100 billion are wasted each year. He'll have oversight hearings on that. That's not oversight hearings about what Obama is doing, but what the Medicare administration is doing.

REHMHere's what troubles me. You got so much government spending that's built into the system. How do you reduce those programs without getting the whole country up in arms, David?

BROOKSWell, the likelihood is we don't. But we had an Erskine Bowles-Alan Simpson Commission, and they put together a report, which you might like parts, dislike parts. But it was a serious commission. We had another one called the Bipartisan Policy Commission. To me, the most exciting thing about politics right now is everything is up for discussion. Medicare, health care, corporate welfare...

REHMSocial Security.

BROOKS...Social Security, tax reform. People are talking about fundamental things within the White House, within Congress, so everything is up for negotiation all of a sudden. Everything goes up for discussion. It makes it phenomenally difficult for President Obama to pick the right thing. I think most people can -- you could find, substantively, the right way to cut these programs, but, politically, the road to get there is tremendously difficult.

REHMWhat about John Boehner? He's got a tough job, too. James.

THURBERJohn Boehner doesn't want to overreach. He doesn't -- he's not having these elegant balls and celebrations. He's playing it right. He thinks that we need to cut back government.

THURBERBut, also, on this issue of unpopular cuts, it's not only spending cuts to Social Security, Medicare -- in terms of cutting out people who are very wealthy that get some of these benefits -- it's also tax reform. The Republicans are talking about spending, not taxing, not tax reform.

THURBERAnd we just pushed through a tax extension -- an extension of the Bush tax cuts. We did find some commonality between the President and Republicans on that, but I think these next two years is a year where we have to look at tax reform. And the commission looked at it, and I think that Congress will look at it also.

REHME.J., how are the Tea Party and the Republican Party likely to coexist?

DIONNEI think, at times, happily, at times, fractiously because I think there are two, sort of, factors playing on Boehner that he's going to have to balance. On the one side are the Tea Party supporters, and that's one of the reasons, for example, we are opening this Congress with a reading of the Constitution. And, you know, it's a great Constitution, so I don't particularly have any objection to that.

REHMYou're saying it's the Tea Party that wanted that done.

DIONNEI think that is -- you know, they have treated the Constitution as a kind of sacred scripture. The -- on the other side, though, there are 31 of the newly-elected Republicans who represent districts that Barack Obama carried in 2008. All in all, I think there are 62 Republicans who now represent Obama districts. Now, not all those districts will exist after the reapportionment. Not all of them will vote for Obama. But that's a big chunk of Republicans who have to look over their left shoulders every once in a while, and I think that's going to be an interesting dynamic.

DIONNEOn the budget, I just can't help but noting that if we just went back to the tax rates that existed under Bill Clinton, we'd close the deficit by as much as the Bowles-Simpson Commission did with all their complex proposals. And until Republicans are willing to say, yes, we need more revenue, i.e. tax increases, and Alan Simpson -- no Marxist was willing to say that. Until we get to that point, we're not going to have a serious budget discussion.

THURBERWell, you know...

BROOKSHere's -- they're willing to compromise, though. The Republicans want to go back to the spending of 2008. E.J. wants the tax rates of 1998. I'm fine with that. It's not going to solve our fundamental Medicare problem.

REHMAnd we're talking about going up to 35 percent. Is that correct?

BROOKSYeah, I think -- you know, essentially, we had pretty good growth with those rates in the '90s. I don't think now is the right time to do it, but in two years, I think it's the right time.

DIONNERight.

REHMJames Thurber.

THURBERBut let's put this in context. The president was the one who created the commission. Congress rejected creating the commission. I think the impact of this is it puts the debt and the deficit and tax reform and spending cuts on the agenda that has people talking about it, not only the Tea group people, Tea Party movement people, but American. I think that's great because we're facing a terrible debt problem in the future, and it's on the agenda. I think that this Congress will deal with it.

BROOKSBut it's easy -- I mean, Diane, you asked the right question a couple of minutes ago, which is, politically, people are going to be up in arms. Parts of the American public are ready to accept the sacrifices. Parts are not because they fundamentally don't trust government to do it fairly. That's a pretty legitimate point of view. So the political challenge is, how do you structure things to get people moving in the right direction so American people feel the process is fundamentally legitimate? I think doing tax reform as a segue to the entitlement reform is the right way to go because there's some bipartisan agreement. You can do it in a way that'll help generate growth, probably raise a little revenue, and that -- I think that'll loosen up our polarized political system.

REHMNow, when you say reform the tax system, what ideas come to your mind?

BROOKSWell, everyone sort of agrees on the basic framework that was in the Simpson-Bowles Commission, which was, you broaden the base, the amount of things that are taxed, and you lower the rates. You bring them down, but you tax more things. You know, I love my home mortgage reduction, but for the sake of the country, we've got to be able to give up some things. And so I'd be -- you know, I think a lot of us would be -- should be willing to give up the home mortgage reduction in exchange for having a healthy future for our kids.

THURBERAnd the home mortgage deduction is up to $700,000. It's not like they're hitting all of America. It's people that have very large houses, $2, $3 million debt, and they're having a write-off. It's not radical. I think we can find some consensus there.

DIONNEThe problem is changing the home mortgage reduction at a time when the housing market is in such a mess. Now, you can face it in -- you're never going to get rid of the whole mortgage deduction in the United States anytime soon. I think what the best that could happen, in terms of raising some money, is to cut it back, maybe turn it into a credit. The most interesting proposal in their tax reform, which is the one Republicans are most likely to resist, is to begin treating capital income, capital gains dividends, as ordinary income. Now, in 1986, Ronald Reagan was willing to say, if you cut the rate, I'm willing to do that. It's not clear that the current Republican majority is willing to do the same.

BROOKSWhat you've got to do is you've got to give each party something it salivates for...

REHMOf course, of course.

BROOKS...something it really wants...

REHMYeah.

BROOKS...and then they'll swallow the rest.

REHMNow, how much will President Obama himself be involved in all these negotiations, all these tradeoffs, David?

BROOKSI think more so. I -- you know, I speak to a lot of congressmen about what -- how the administration has dealt with them. And one of the things I hear frequently is the Clinton administration did quite a good job of talking to members of Congress -- the last two administrations, not so much -- and so there was some contact, especially with the House, through Rahm Emanuel. But I think the president was somewhat removed, even from Democrats, and will now have to get a lot more involved because this is the year of budgets.

THURBERYou know, I think President Obama in the first two years gave too much discretion to Capitol Hill, to people like Henry Waxman on cap and trade and the health care bill on the House side. And some presidents actually sent forward legislation -- Clinton did. This president didn't do that. He sent forward memos with general objectives and principles, and then he allowed Congress -- with the stimulus bill, the health care bill, the financial reform bill -- to do their will. I think he will become more engaged. One of the reasons is because he has a Republican House of Representatives, and he has to work with them on some common ground. Whereas he allowed Speaker Pelosi and the other chairs to sort of have their will on the House of Representatives.

REHMHe's already spoken about tax reform himself. Would you believe that that might, indeed, happen this year?

THURBERWell, I think it has to happen soon because, remember, at the end of these next two years, the rates go back up because the so-called Bush tax cuts are only for two years. So there -- he's being driven to deal with it. But, also, the commission has some good ideas. I think that my colleagues are right. They have to -- there has to be -- you have to give something to get something. And so, on the tax reform, he has to give something on the cuts and Social Security, Medicare, some of these entitlement programs that are a very large part of the budget.

DIONNEYou know, in the last Congress, I heard from both liberal Democrats and conservative Republicans that the only way you could get the administration to talk to you is if you were a moderate Republican Senator from Maine. The administration was so focused on getting to 60 votes. And you heard these complaints on both sides. They have to engage more. I don't think it's so much that they ceded authority, although they did some of that, but I think they were -- you always have to cede some authority to Congress. I think it's that they didn't communicate with the Hill very well, and I think they know that now.

THURBERAnd it's a...

BROOKSBut wait a minute. The first thing the president did was he went to Capitol Hill and met behind closed doors with the Republican leadership in the House and the Senate, and a third of the stimulus package were tax cuts that they liked. And...

DIONNEOh, I totally agree with that. But what I'm saying is ongoing...

BROOKSHe engaged.

DIONNE...communication.

BROOKSYeah.

DIONNEYeah.

BROOKSWell, communication means that you have to have a clear strategy theme and message and repeat it, repeat it, repeat it. And he doesn't do well at that. He's great at lectures. He's like a university professor. He -- great at having these detailed lectures about what the health care reform bill is doing, but he didn't keep it simple and didn't repeat it. My professors...

REHMBut I wonder if you saw something different during the lame duck Congress from President Obama.

BROOKSWell, I think there was a lot more dealing. My professors were very repetitive, by the way.

BROOKSAnd I think what's interesting within the administration right now, they realize that the State of the Union speech is certainly the most important speech in the next two years, maybe of the presidency because it's his time to really fashion an agenda. And the debates they're having -- it's interesting. They're having a debate about whether to do Social Security first or tax reform first, which, by the way, is the exact same debate the Bush administration had in the second term. The thing that disappoints me is a little -- despite years of talking about tax reform, according to them, they're not very deep into figuring out exactly what it would look like.

REHMAnd doesn't it always take two or three years to really come through with a tax reform package?

BROOKSYeah, we wouldn't start it. We would start it. We wouldn't complete it. What's, you know, also interesting to me is you could get a bipartisan deal. The question is whether you could get it through Congress. And a lot of members of Congress are dubious they could beat back the special interest.

REHMDavid Brooks is a columnist for The New York Times, author of the upcoming book "The Social Animal: The Hidden Sources of Love, Character, and Achievement." And you're listening to "The Diane Rehm Show." We're going to open the phones now, 800-433-8850. Let's go to Clemmons, N.C. Good morning, Harvey. You're on the air.

HARVEYGood morning. I wanted to address some comments that were made earlier in the program about health care. And I hear politicians get on TV on their photo ops, constantly raving about that we -- United States has the best health care in the United States. And I find that to be completely misleading and disingenuous. When you look at the actual facts, we are 49th in the world in infant mortality -- that's babies living to the age of one year of age. We're 12th in the world in male longevity. And so many of the other statistics -- proven factual statistics around the world, that we're behind all the rest of the industrialized countries. And yet the politicians continue to get up in front of the camera and state that we have the best health care system in the world.

HARVEYApparently, they have the best health care system in the world, while the rest of the United States doesn't. I want to know why the media doesn't come back to them and hit them with some of these statistics and demand some kind of transparency and truth and accuracy from them, instead of listening to all that stuff while they're talking about dismantling the new health care reform program.

REHMAll right. James.

THURBERYes. There's been measures of outcome of health care for 20 industrial nations for many years. And we always come right at the bottom, except for one factor, and that is cost. We're exactly twice as much as the next country in the world. This health care bill that passed is very complex, but it deals with cost, cost controls that the Republicans wanted. But they don't really talk about that that much. Quality, measures of outcomes in quality, and also finance, which we're talking about in terms of the insurance and access. Now, the problem is, it's so large and so complex that it's hard to explain. And once it starts coming in, as we said before, I think people will like it, will deal with this cost problem and quality problem.

REHMAll right. To Sarasota, Fla. Good morning, Elliot.

ELLIOTYes, good morning. I would like to know why the media seems to place such a great emphasis on the Tea Party. It's a fraction of the country. They certainly don't represent what the people want. They have very skewed ideas. They're very negative. They're almost nihilistic in their approach to the government. They want to cut spending. They don't say what they want to cut. They're against health care. What are they going to substitute for that?

REHMDavid Brooks.

BROOKSWell, first of all, they are sort of a dynamic movement. They control this, really, tempo of the debate for the past year, and they are a significant part of the country. You know, you get wildly different polling results of how many people sympathize with the Tea Party movement, but it gets up as high as 40 percent, sometimes in the 20s. So a lot of people feel themselves sympathizing with it. I do, though, generally agree that we have paid too much attention to the Tea Party movement, less attention to the shifts among independents that took place in the past year.

REHMBut how could you not?

BROOKSTo me, that was the big story.

REHMHow could you not pay attention...

BROOKSRight. I agree.

REHM...to the Tea Party?

BROOKSI mean, I agree.

DIONNEI think the issue is that the media's attention is, indeed, way out of proportion to their numbers in the electorate. In other words, it's easy enough to get numbers in polls showing that people sympathize with the Tea Party. A lot of conservative Republicans say, oh, what the heck. I like them because they're helping my side. But when you actually look at polling measured, how many people actually went to Tea Party rallies? How many gave money? You're talking about 3 to 6 percent of the American people.

DIONNENow, that's a lot of Americans. We're over 300 million people. But it's not the sort of dominant movement in American life. I sometimes think that the media have given more attention to the Tea Party than it deserved, much as the media gave more attention to the New Left, back in the 1960s, than the New Left deserved.

THURBERYou know, the media didn't cover what happened in this election with respect to the seniors and independents. There was a great shift, and they made the difference much more than the Tea Party Movement, in my opinion.

REHMJames Thurber, his upcoming book is titled "Obama in Office: The First Two Years."

REHM"And as we talk about what's coming in 2011 on the domestic side, with Congress certainly divided, and now the Obama administration is using rulemaking and regulations, perhaps, to guide the agencies and the statutes along the lines of the administration's desires." That's an e-mail from Kate, David Brooks. How effective will this tactic be?

BROOKSWell, the political center of gravity will shift more toward the agencies as the president tries to use the agencies, not legislation, to get what he wants, and Republicans try to clamp down on the agencies. The -- one of the main arguments the Republicans use again and again is that the business people said we couldn't have any certainty because we don't know how much this regulation was going to cost, that regulation was going to cost. And that's one of the reasons why we didn't invest and why we're sitting on all these cash. And Republicans want to provide that level of certainty. So there's going to be a great deal of fighting over the EPA in particular.

THURBERYou know, there are about 300 bills passed every two years in Congress and 25,000 regulations every two years. Maybe 1,000 of them are important. These very large and vague bills -- the health care bill, financial reform bill, even the stimulus package and others -- call for years of promulgation of rules and regulations. Now, the Republicans will try to slow that down. The president lost cap and trade on the Hill, the climate change bill. And he immediately shifted to EPA and pushed them to promulgate rules on the regulation of greenhouse emissions from coal fire plants and other industries.

THURBERRepublicans and Democrats don't like that. Sen. Rockefeller from West Virginia doesn't like it. He has a bill in to stop them from doing that. We have the Congressional Reform Act that can stop them also. And you can use appropriations and language and appropriations bills to stop them. So it's going to be a big struggle on the Hill over regulation.

DIONNEYou know, if you talk to environmentalists, what a lot of the very knowledgeable environmentalists would say is that the first two years of the Obama administration were very, very positive, from their point of view, because he really did roll back virtually all of the regulations that President Bush promulgated that they found objectionable. He strengthened the environmental regulation. That's true in a number of other areas. So I think Jim is absolutely right. You're going to see a big fight. The Republicans are going to try to push back on this. They have some levers that they can use, you know, particularly on cap and trade, I think.

DIONNEBut I think there's also an area where President Obama can both satisfy his base, such as environmentalists, and be on the popular side because a lot of Americans, when they -- regulation in the abstract is not popular, but a lot of the specific regulations to, say, make sure we breathe clean air or drink clean water are quite popular.

REHMAnd what about the FDA's new assignment, David Brooks?

BROOKSWell, there's going to be an aggressive push on that. And I just -- I want to go back to the financial reg. reform...

REHMSure.

BROOKS...because, I think, that's the crucial one. Because that bill, well, having many good objects, left a lot of us bewildered because it was very hard to tell what exactly that did because they left a lot of power to the various regulatory agencies. And I think that's going to be the central area in which the regulatory fight is going to be fought. And it will be a question of how -- what actions we take to prevent another fiscal crisis.

THURBERAnd there are deadlines in that act for Treasury to promulgate rules and regulations. There are deadlines for HHS to produce things also. And if they don't meet the deadlines, that's -- they go to court. They get sued immediately if they don't meet the deadlines. And so that was very clever of the people on the Hill. It was a vague bill, but it wasn't vague in terms of deadlines. There's also the FCC, the FDA on food safety. There's going to be a great deal of action, and it's going to be hard for the Republicans to keep up with it.

REHMAll right.

DIONNEAnd watch the fight over the financial consumer product safety commission...

REHMAbsolutely.

DIONNE...that Elizabeth Warren is putting together.

REHMYes.

DIONNEI think that's going to be a focus of a lot of controversy.

REHMAll right. To Pete...

DIONNEAnd support, too.

REHM...in Rochester, N.Y. You're on the air.

PETEGood morning. E.J., I'm sorry. You've disappointed me once again, that you allowed David Brooks to get away with the attempt to equate Obama's accurate description that the Republican Party was holding the country hostage, with Darrell Issa's comment that this administration is the most corrupt ever. All right? The fact is that over the last 30 year -- over the last -- the working people, the sacrifices that David Brooks is expecting to occur, he expects people, the working class people, to make those sacrifices with cuts in Social Security, government payroll being cut.

PETEBut there is no outrage at the insistence -- and this is where the hostage taking was -- where the Republicans held out until they got the tax cuts for the millionaires and billionaires in this country who don't need the money, and the money does not actually stimulate the economy. The working class in this country have not seen a raise in almost 40 years, even though they continue to produce more, but those are the people that are expected to sacrifice.

REHME.J.

DIONNEWell, first of all, I don't think I let David off the hook...

REHMI don't think you did either.

DIONNE...about the -- I specifically disagreed strongly -- more than disagreed -- with his notion that the Obama administration is most corrupt in history. I think it was a terrible thing to say. But, yes...

BROOKSWell, he didn't say that. He said...

DIONNEWell, he said that.

REHMYeah, right.

DIONNEAnd that I don't see that -- just to be clear, I don't see that as comparable to what Obama said about the Republican Congress. But -- well, let me -- and then let me have David respond to him because I do agree with the caller on the point that sacrifice is easier to talk about in the abstract than in the concrete, and that a lot of Americans feel they've sacrificed a lot in this economic downturn, and that the word doesn't sort of sit well with them when they are unemployed or have lost their house or have lost income. But the notion of shared sacrifice, genuinely shared sacrifice, like you pay a little more in taxes when you go to war. I think that's a sensible idea.

BROOKSFirst of all, I'm always appalled that E.J. lets me get away with stuff. It's a constant of our relationship. But let me talk specifically about this...

DIONNEThat's what the caller believes.

REHMYeah, right.

BROOKSLet me talk about the core sacrifice that has to be made. We have a bipartisan conspiracy that links benefits to the upper class to benefits to the middle class. So, for example, in the Republican side, they never want to separate tax rates for the upper class with tax rates to the middle class. If you cut the middle, you got to cut the upper. On the Democratic side, they want to make sure Medicare benefits to the upper class are tied to Medicare benefits to the middle class. They want to keep those together.

REHMHmm.

BROOKSWe've got to break that on both sides in order for -- we've got to cut Medicare and other benefits for the affluent, and we've to raise taxes and others for the affluent. That's essentially the deal that you have to have to balance the budget.

REHMAnd are we likely to get something like that, David?

BROOKSI wouldn't say likely over the near term, but there's no other -- you know, we've got to -- if we're going to balance the budget over the next 10 or 20 years, where is the money going to come from? It's going to come from cutting benefits and raising taxes, mostly on the upper middle class.

REHMWhat about the outlook for jobs, jobs, jobs, James?

THURBERWell, in the short term, they have to do something to make sure the economy keeps pulling out of it. The housing market is a major problem. Housing market is down. It'll be down for a couple more years, they say. That creates a lot of jobs. So when you're creating jobs, it's hard to cut spending and hard to increase taxes, like on mortgages. It's a tough thing. But I think the commission -- this commission and the last commission have all the ideas. You phase these things in over a long period of time. You pull the economy out, and you start raising taxes and cutting spending. You got to do both. And everybody knows that.

REHMAll right. To...

DIONNECould I just say that what progressives worry about...

REHMSure.

DIONNE...in terms of Medicare cuts, is the idea that they'll -- if you make the program less universal, over time it will become a less good program, that, alas, in our history, programs that are just for the poor are often poor programs, and that -- that's why, I think, in the long run, what we're going to do is we're going to have some kind of universal guarantee of health coverage that will cover everyone with the affluent paying more and poor people paying less. That is, in the end, the only way out of this dilemma.

THURBERWell, in a way, that's the way it is now. There are a lot of doctors that do not serve Medicaid for the poor, but Medicare. You pay extra in order to go to them, and they do not take Medicare. They don't even take Blue Cross Blue Shield.

REHMRight.

THURBERWe have two different systems now for the very wealthy and for the middle class.

REHMLet's go to St. Louis, Mo. Good morning, Eric.

ERICGood morning. Since I'm speaking to four expert communicators, I wondered if you share my dismay over how language has been used to pervert the debate about these things over the last 30 years. It seems to me there's been a very successful campaign to turn the word taxes into an obscenity, and I now see that same campaign being applied to the word spending. And yet when the House of Representatives reads the Constitution, I'm wondering if they're going to skip over the part where they talk about the Constitution being constituted to promote the general welfare. That's why we have a government is to provide services that the society needs, and yet the language of the debate seems to miss that. I wonder if you share my concern about this.

REHME.J.

DIONNEI think you're an excellent communicator yourself. I basically agree with you on all fronts. And one of the reasons I actually welcome this focus on the Constitution is precisely for what you said. We need to debate the Constitution whole. And it does say that the Congress should -- that the government should provide for the general welfare. And it does include the Fourteenth Amendment to guarantee equal rights. It actually includes an amendment for the income tax. I wonder if they're going to boo the income tax amendment when it comes time to read the Constitution.

THURBERWell, I...

DIONNESo amen to what the caller said.

THURBERI hope they include the amendments. They haven't been talking about the amendments if they are part of the Constitution. And when they start including the amendments, they may be surprised.

BROOKSCome on. I mean, these guys are not troglodytes. I mean, the people who are coming to Congress, whether Tea Party or not, believe in government. They want to use government. A lot of them are open for infrastructure bank. They might want to reduce spending as a percent of GDP from 25 percent to 21 or maybe 19 percent. But the idea that we're going back to 1830s -- talk to them. It's not what they're talking about.

REHMAll right.

DIONNEThat is what they're -- we were talking about going back to the 1890s. Their vision of the Constitution is that everything that's happened -- I'm not talking about the whole Republican Party. I'm talking about the right end. They believe...

BROOKSName a candidate that calls for repealing Social Security and Medicare. Name one.

DIONNEWell, that's only because so many of their voters are over 65. But their principles are that the new deal is unconstitutional.

BROOKSThe hidden agenda. They have a hidden agenda.

REHMAll right. Let's go to Tampa, Fla. Hi there, Bud.

BUDHi. I think people need to -- especially the Republicans -- look at historically and look at -- back in the '50s, corporations were being taxed to 59 percent, upper income people, I think, it was 86, 91 percent. And that's the greatest period in our economic growth, and this being taxed and reducing taxes is not going to make the economy grow again. We have to have more debts, and we have to look at, well, industry. And we have to look at what are we doing today in terms of production and get away from this tax cut, tax cut and...

REHMYou know, it's interesting what this last election has done, which is to make people think more about these issues -- at least I hope so.

THURBERWell, as I said before, I think the commission helped. I think the...

REHMRight.

THURBER...Tea Party movement helped. They helped immensely in terms of looking at spending and deficit and debt. But, you know, I think we had great growth under Clinton. We had four years of surplus. He actually raised taxes on certain categories in society. And so we should go back to the Clinton period, and E.J. talked about that before. We had a surplus going into the Bush administration of $3.4 trillion.

REHMAnd then got a messy tax cut, David.

BROOKSWell...

THURBERRight, we did.

BROOKSWell, I opposed that tax cut. But I think, to be fair, the Clinton era benefited from the budget. They also -- from the bubble. They also didn't face the fact of the rising entitlement cost. But I do think it's that rise of entitlement cost, the unsustainable -- the deficit that's causing this fundamental debate.

REHMDavid Brooks, he is a columnist for The New York Times, author of the upcoming book, "The Social Animal: The Hidden Sources of Love, Character and Achievement." And you're listening to "The Diane Rehm Show." Now, to Fishers, Ind. Ron, what's on your mind?

RONGood morning, Ms. Rehm. Could you have your group there -- it's very interesting discussion, this particular group. If you -- could you have your guys to put a fine point on why there is so much resistance to a national health care plan? My perception is that health care plans have changed a lot over the years, in that we're not getting as much corporate support, that kind of waning, and we're looking in a different playing field than we were even 20 years ago. And I keep -- the other thing that -- if they could put a fine point on that.

REHMSure.

RONAnd the other -- is over the holidays, I kept hearing the right say that this bill was a big job killer. And as I look at -- in a job search way, I see insurance companies, health insurance companies and medical practices hiring lots and lots of people -- lots...

REHMSure. David Brooks, do you want to comment?

BROOKSWell, the reasons why people are -- in this country, are suspicious of a national health care plan involve many things, including a national suspicion of government, fear of rationing, that the government would cap total health care cost and that would lead to a form of rationing, which people don't like -- though I think it's probably necessary -- and then the fear that the government would get in the way with their relationship with their doctors.

DIONNEI think...

THURBERWe...

DIONNEGo ahead, Jim.

THURBERYeah, we have a mixed system here that's going to be very hard to change and have some kind of national health care plan. We have -- it's basically a finance system with some cost controls for the aged, for the poor, for poor children and from employers, and then the people who are not insured are on their own. And we have a mixed delivery system that is very strange. And even if you have the money, it doesn't mean that you can find a doctor or a hospital that will take you. It's very different than any other industrialized nation in the world.

DIONNEI think a lot of Americans, whenever we debate this, worry that whatever change we make, they're going to lose more than they'll get out of it. And that's one problem. The other is -- Jim suggests, is we've got such a complicated system, there were so many interests, who have something to gain or lose -- insurance companies, drug companies, hospitals, doctors, nurses -- that it becomes very difficult to pass anything coherent because these interests clash so much. So it's a very hard thing to pull off, which is why passage of that health care bill last year is still an enormous achievement.

THURBERIn fact, that bill is full of compromises. The AARP, for the aged, wanted it. The American Hospital Association wanted it. The docs wanted it. They had a...

DIONNESome of the docs. (unintelligible)

THURBERYeah, some of the docs. I'm talking about the AMA. There was a treaty with the president. And they have different provisions in it, and they don't always match.

REHMBut, you know, it seems to me this goes back to the issue one of our callers raised of the use of vocabulary -- death panels, rationing, you know, all those words that scared the American people and still do. I want to thank you all for being here. E.J. Dionne of The Brookings Institution and The Washington Post, author of "Souled Out: Reclaiming Faith and Politics After the Religious Right" and "Stand Up, Fight Back," David Brooks, his new book is "The Social Animal: The Hidden Sources of Love, Character and Achievement," James Thurber of American University. His upcoming book is titled, "Obama in Office: The First Two Years." Thank you all so much.

DIONNEThank you.

THURBERThank you.

BROOKSThank you.

REHMAnd Happy New Year, everybody. Thanks for listening. I'm Diane Rehm.