Needless to say, King, who has frequently defied party orthodoxy on the issue of homeland security spending cuts to New York City, said that he strongly stated his objection.

"I strongly stated my objection, but the fact is right now they are dug in," he said.

King said that he could understand the objection by his House colleagues, calling the measure to re-allocate money a "three-fer" for some on both sides of the aisle: it is a vote to cute spending, a vote to cut spending to New York City and a vote to cut spending to the United Nations. He also noted that many were right to say that money allocated for a specific purpose--in this case to keep employees at the United Nations on a similar pay scale to their international colleagues--should go back into the U.S. Treasury.

But he said that the $100 million figure to secure the U.N. complex on the east side of Manhattan had been arrived at carefully and in close consultation with NYPD commisioner Ray Kelly, and King say that the complex was due for a full-scale security upgrade.

King added that back channel talks were in place at the moment to restore the money through the normal allocation process, but he said it was unclear how that would clear parliamentary hurdles.

The bill is slated to come to the floor tomorrow and will need to be approved by a two-thirds vote. The vast majority of Republicans will likely vote to cut the funding, but it is unclear where the majority of the Democratic conference stands.

King refused to say if this entire episode meant that Republicans should take another look at Cantor's citizen-driven YouCut initiative, but he did say, "If we are going to cut, we should look at something and make sure it is as simple as it appears to be.

"This is a matter of life and death."

MoMA announced this morning that it has acquired a complete version of the film—both its original 13-minute version and a 7-minute excerpt made by the artist. With the purchase, MoMA seems to be sending a pointed political message to the Smithsonian, which took down the video after pressure from the Catholic League and Congressional Republicans.

But MoMA didn't just purchase the video. In what is more like a middle finger than a finger wagging to the Washington institution, the museum announced the work would go on view—today—in its massive Contemporary Art from the Collection exhibition. (New acquisitions are rarely displayed immediately.) The video will join a group of other art works made, like A Fire in My Belly, during the AIDS crisis in the late 80s and early 90s.  

In a statement, MoMA called the late Wojnarowicz "one of the most influential artists to have emerged from New York in the 1980s." A Fire in My Belly will be the 13th Wojnarowicz work to join its collection.

MoMA's acquisition will certainly frustrate those who hoped to limit the video's viewership. MoMA serves a much larger volume of visitors than the National Portrait Gallery, where the video was originally on view.

A spokesperson for Representative Eric Cantor once called the video, which features ants crawling on a crucifix, "an outrageous use of taxpayer money and an obvious attempt to offend Christians during the Christmas season." But while the Smithsonian exhibition closes in February, the offending work will now be on view for Easter, too. MoMA's exhibition runs through May 11.

David Wojnarowicz "A Fire in My Belly" - Smithsonian, National Portrait Gallery Edit from ppow_gallery on Vimeo.

Following a brief but intensive reconciliation period, the House passed the conference report of the updated financial reform legislation Wednesday, June 30. The voting divided along party lines, with only three Republicans among the 237 representatives supporting the legislation. The newly christened Dodd-Frank Wall Street Reform and Consumer Protection Act now moves to the Senate, where it will likely pass its final hurdle in mid-July before making its way to the president's desk.

Senate passage is not guaranteed; the death of Senator Robert Byrd means that Democrats must lure one more Republican vote. Nor will passage into law bring financial reform to closure, since regulatory authorities must now decide on many specifics of implementation.

Bark Now, Bite Later

Even as many of its key provisions have been softened or eliminated altogether, the Dodd-Frank Act-which now includes more than 1,600 sections spread across more than 2,300 pages-has been heralded by its framers as the most significant overhaul of the financial sector's ground rules since the reforms triggered by the Great Depression.

In a prepared statement released by the White House just after Wednesday's vote, the president said that "it has been a long fight against the defenders of the status quo on Wall Street. ... Today's vote is a victory for every American who has been affected by the recklessness and irresponsibility that led to the loss of millions of jobs and trillions [of dollars] in wealth."

Perspective is everything. In contrast with the president's reading of the act, House Republican Leader John Boehner declared that the legislation "will actually kill more jobs, widen the gap between Wall Street and Main Street and force taxpayers to fund permanent bailouts." Republican Whip Eric Cantor was equally blunt. The New York Times on Wednesday quoted Mr. Cantor as saying that "this legislation is a clear attack on capital formation in America."

Only the most jaundiced eyes will parse through the legislation's labyrinthine text and uncover imminent threats or panaceas for the familiar order. Rather, divisive provisions with clearly defined implications have been the focus of intense lobbying efforts and partisan negotiations during the relatively opaque conference period. Provisions with muscle have struggled to survive the gauntlet; the meekest, on the other hand, have made their way through in extraordinary abundance.

For Senator Russ Feingold, the dilution of the legislation now precludes his support. In a June 28 statement, he wrote that "while there are some positive provisions in the final measure, the lack of strong reforms is clear confirmation that Wall Street lobbyists and their allies in Washington continue to wield significant influence on the process."

One example of the conditions of compromise, a late tax provision designed to offset the act's anticipated costs by raising approximately $18 billion from the nation's largest financial institutions, was eliminated in 11th-hour negotiations. In a June 29 letter to Senator Chris Dodd and Representative Barney Frank, Senator Scott Brown wrote that "if the final version of this bill contains these higher taxes, I will not support it. ... It is especially troubling that this provision was inserted in the conference report in the dead of night without hearings or economic analysis."

Under an alternative plan, the cost of the act will be partially offset with unused funds from the Troubled Asset Relief Program, which the new legislation would bring to closure months ahead of schedule. Since that authority might have otherwise gone unused, the abrupt change of plans could be seen as adding billions of dollars to the federal deficit.

For commercial real estate credit markets, the elimination of the Senate bill's Credit Rating Agency Board provision is one of the significant changes made during the conference period. This is a double-edged sword for opponents of the CRAB-as I detailed in my May 19 Lead Indicator column-since it leaves the door open for alternative proposals for oversight of rating agencies' relationship to issuers. Provisions relating to the enhanced regulation of rating agencies begin with Section 932 of the conference report (on page 1351).

Among the provisions, the act will establish an Office of Credit Ratings that will "promote accuracy in credit ratings" and "ensure that such ratings are not unduly influenced by conflicts of interest." As for how the new office will fulfill these mandates, the conference report focuses on rating agencies' reporting and disclosure requirements.

Delegation and the Act

A reading of the new legislation reveals that it goes further in setting up new regulatory powers and structures than in taking direct action. This might be appropriate except that it delegates decision making about industry structure to the empowered agencies. In the short term, this extends uncertainties about financial-services market structure. It also emboldens lobbyists and elected officials to engage in further horse-trading, this time outside of the public spotlight.

For the long run, the legislation raises serious questions about where major decisions pertaining to market structure, with potentially far-reaching economic consequences, are made: by our elected officials, who generally must act without the benefit of subject-matter expertise, or in a more erudite setting, where subject-matter expertise may be stronger but where decisions are even further removed from public scrutiny?

In a July 1 opinion in The Wall Street Journal, Daniel Henninger opines that the legislation "lets the actual meaning of the 'Volcker Rule' on banks' trading practices and much else pass into the hands of the translators at the Federal Reserve, FDIC, other federal agencies and the lobbyists who swarm around them."

There are meaningful changes that will result directly from the passage of the Dodd-Frank Act, some for better and some for worse. Still, Mr. Henninger is right to draw attention to the delegation of decision making.

In fact, this delegation is not specific to the Dodd-Frank Act but pervades legislative efforts on a host of complex issues for which our strained political process affords neither the time nor the forum.

schandan@rcanalytics.com

Sam Chandan, Ph.D., is global chief economist and executive vice president of Real Capital Analytics and an adjunct professor of real estate at Wharton.

Over the week, Republicans closed the tent. The establishment is now backing Doug Hoffman, an accountant who was nominated by the Conservative Party after Republicans picked Scozzafava. He has won the primary that never happened.

It's brewed for weeks: presumptive presidential candidates Sarah Palin and Tim Pawlenty declared their support for Hoffman. National PACs upset with Scozzafava's support of the federal stimulus, EFCA, same-sex marriage and abortion rights poured on money and attacks. Fred Thompson cut an ad for Hoffman.

At some point, Hoffman had gone from odd-ball spoiler to the best chance the Republicans have of keeping the seat out of Democratic hands. The National Republican Congressional Committee stopped attacking him and the Democrats, whose candidate Bill Owens was slowly and quietly building support, started.

The fatal blows to Scozzafava came Thursday. Representative Pete Sessions, chairman of the NRCC told Politico that if he won, Hoffman would be welcomed "with open arms." That night, George Pataki, the moderate former New York governor told a reception of Conservative Party members that he was backing Hoffman. It was a harbinger that the state Republican establishment--Chairman Ed Cox has skipped many opportunities to fight for Scozzafava--was gone along with the national guys. Then word of a new poll got around: Hoffman and Owens were in a dead heat, and Scozzafava was fatally lagging. She issued a statement Saturday morning, and "released" her supporters to do as they pleased. Dede Scozzafava never backed away from her moderate positions, and they killed her.

"You could smell it coming a mile away," said Jim Ellis, the Franklin County Republican chairman whose own views are more conservative than Scozzafava's. "I think Dede had the misfortune of running at a time when that particular message that she was putting out there had no relevance, and the NRCC basically wouldn't let her do what she normally would have done."

It was the local party officials--guided by Ellis--who settled on Scozafava; not the national partisans. Some chairs had reservations, but Scozzafava built a coalition of moderates to get the nomination, leaving bad feelings in the minds of some of the more conservative chairs.

It didn't matter at first. Scozzafava was the first declared candidate, and built an operation consisting of the consulting firm Capitol Public Strategies--a haven for old Pataki hands like Dave Catalfamo and Bill McGahay--and two staff operatives: Matt Burns and Michael Backus, John McHugh's former chief-of-staff. The NRCC sent two staffers and set about doing what the NRCC does: attack the opponents.

Predictably, the factions clashed. The internal staffers plotted a strategy based on Scozzafava's record in the Assembly, producing ads like this one and advising Scozzafava to not sign a national Taxpayer Protection Pledge that Hoffman was touting.

But no money was coming in. Scozzafava had in the past run with the support of labor unions and small-time donors that knew her over her political career. On a national scene, this completely blunted her in Republican fund-raising circles, especially with Hoffman as an alternative.

"Social stands might make people unsettled, but it's the economic issues that are really driving people and donations away. She's alienated the conservative, free enterprise wing of the party," said one prominent New York Republican. "Card check? The stimulus? I can't make a call to anyone on her behalf because of those things."

The money to pay Capitol Public Strategies ran out. The internal staff was overwhelmed.

The NRCC was left holding the bag, and as Ellis said, was unwilling to build on the support Scozzafava had, lest it alienate its own national donor base.

"Where were the pro-choice women's groups? Where were the marriage equality folks? How come no one went up to Doug Hoffman's accounting firm with signs attacking him for hating their gay daughter?" said one Republican operative familiar with the campaign.

"The argument was that she didn't have a clear path to victory," said a different operative familiar with the campaign.

Finally, the NRCC bailed and Scozzafava walked away. Loads of Republicans uncourageously jumped off the fence.

"By suspending her campaign it makes it possible for the Republican Party and the Conservative Party to unite and support the basic core values of the Republican Party on Tuesday," said Rick Lazio, who seeks both parties' blessing in a run for governor. "I congratulate her for her selflessness and join her and other Republicans in supporting Doug Hoffman for United States Congress."

"Dede Scozzafava has placed her Party and her principles over politics and position for years," said Cox, whose spokesman on Thursday insisted he was working hard to support her. "For those who know her, her actions today come as no surprise because they show real leadership. It is testament to her character and strength under difficult circumstances. Throughout her career, she has built a record of standing up for the people of the North County. This move demonstrates her commitment to ensuring that those people have a Republican, fiscally conservative voice in Congress."

"With Assemblywoman Scozzafava suspending her campaign, we urge voters to support Doug Hoffman's candidacy in New York's 23rd Congressional District," said Sessions, along with Republican Leader John Boehner and Whip Eric Cantor. "He is the only active candidate in the race who supports lower taxes, fiscal responsibility and opposes Nancy Pelosi's agenda of government-run healthcare, more government and less jobs. We look forward to welcoming Doug Hoffman into the House Republican Conference as we work together for the good of our nation."

Ellis told me he's "weighing" supporting Hoffman. Scozzafava is conspicuously not: given the mud he's slung at her, that probably breaks more favorably for him than would any endorsement.

"I could talk a lot about things that went right, and things that went wrong, but there's no point," Scozzafava said in an interview this morning. "Things happen for a reason, and I believe there's better things to come."

Bill Nojay, a conservative Republican talk show host in Central New York said that one of two questions at stake is now settled.

"She was out of sync with a new evolving direction for the Republican Party both nationally and in New York State. When you have George Pataki endorsing the Conservative, that tells you that the most experienced Republicans recognize that there's been a sea change in Republican politics," he told me. "And now that Dede's out of the way, it's now a take off the gloves yea or nay on the Obama administration."

In many ways, this is true. As anyone who's spent more than a few minutes in the Speaker's Lobby of the U.S. House can attest, the average House backbencher is less suited to and equipped for the national stage than even Dan Quayle was in 1988. But consider this: Since 1960, more sitting members of the House (two: Bill Miller and Geraldine Ferraro) have been chosen as running mates than sitting governors (Spiro Agnew).

O.K., so that's a little misleading. Not many governors have been chosen for either party's number-two slot because so many have won the top spot and then sought to balance their tickets with non-gubernatorial experience. But it's also true that, for all the instinctive inclination to dismiss them out of hand, viable running-mate contenders from the House do emerge from time to time. Besides Miller and Ferraro, there are the examples of Lee Hamilton, who was one of Bill Clinton's finalists in 1992, and Jack Kemp, who was probably Ronald Reagan's preferred choice in 1980, before the political necessity of balancing his ticket with a moderate interfered. And, lest we forget, Richard Gephardt, John Kerry's second choice (and Rupert Murdoch's first) four years ago.

This summer has produced two running-mate prospects from the House, Democrat Chet Edwards (one of 32 representatives from Texas) and Republican Eric Cantor (one of Virginia's 11). But between them, only Cantor seems to have the potential to overcome the inherent bias against the people's House that presidential nominees invariably harbor.

In fact, it's an open question whether Edwards, a 56-year-old centrist whose district includes George W. Bush's hometown of Crawford, is even under consideration by Obama. His name is in the mix thanks to the very public crusading of House Speaker Nancy Pelosi, who has hailed the nine-term lawmaker as "one of the finest people I've ever served with" and openly advocated him for Obama's number-two slot in numerous national media interviews, as recently as yesterday. Perhaps this politicking has sparked legitimate curiosity from Obama. More likely, though, any attention he pays to Edwards is simply a courtesy to a legislative leader whose cooperation would be essential to the success of his presidency.

Edwards doesn't make sense as a running mate because all of the usual knocks against House members apply doubly to Obama's deliberations. Simply put, some presidential nominees can afford to pick an unknown congressman for their ticket, and some can't.

Walter Mondale, who chose Ferraro in '84, is a perfect example of one who could. A former vice president with a dull and conservative manner, Mondale had no problem convincing voters that he was prepared for the presidency. His challenge was to excite curiosity and interest, not to offer sober reassurance. Ferraro, a third-termer who became the first woman ever chosen for a major national ticket, was a risk he could afford to -- and needed to -- take.

Obama's challenge is the opposite. He's attracted all of the attention, curiosity and excitement he can handle. His challenge is to reassure. Picking a House member who, by the nature of his office, could easily be caricatured as a lightweight would offer far too much risk and far too little reward.

What's more interesting is why Pelosi decided to push Edwards among all of the other House Democrats. The Speaker has a richly earned reputation for paranoia -- her first act after the Democrats won the majority in 2006, recall, was a divisive and unsuccessful effort to flush her old rival, Steny Hoyer, from his No. 2 leadership post (even though Hoyer had long since given up any thoughts of challenging Pelosi). And she is known to place an extremely high premium on personal loyalty. In that sense, Edwards, who supported Hoyer in his 2001 leadership fight with Pelosi, is a rather unlikely favorite for the speaker.

Pragmatism probably explains her calculation. Clearly, she's aware of the example of Tip O'Neill -- the speaker who turned Mondale on to Ferraro in '84 -- and relishes the idea of playing a similar role in '08. The problem is that her closest circle of House allies - George Miller, Jack Murtha, and Henry Waxman, among many others -- provides no logical VP prospects. They are all some combination of too old and too liberal -- and just not presidential. She has some younger supporters in her caucus as well, but the last thing that Obama needs is a youthful House member to reassure voters about his seasoning.

What Edwards represents, then, is a compromise between Pelosi's desire for personal loyalty and the reality that most of her allies are poor fits for an Obama-led ticket. Edwards, with nearly two decades of experience, expertise on budget and military issues, and a red-state-friendly moderate voting record, is at least theoretically plausible as an Obama running mate. But it's still a remote possibility.

It's a different story on the Republican side. The 45-year-old Cantor, who won his seat in 2000, owes his place on John McCain's list not to the insistence of a House G.O.P. leader, but rather to what seems to be the legitimate interest of the candidate himself. This makes sense for several reasons.

For one, McCain is in the exact opposite position as Obama when it comes to the VP risk factor. McCain, sort of like Mondale in '84, is a known commodity, and voters need little reassurance that he has the necessary preparation and seasoning to lead. He can afford to team up with a running mate whose main experience involves seven years in the U.S. House. Cantor's (relative) youth would bring energy to the ticket, and his Jewish background would also attract considerable attention. On the whole, picking a wild card like Cantor would attract attention -- something McCain, to his immense frustration, has struggled to do.

Cantor would help in two other specific ways. First, his prodigious fund-raising skills would bring in some badly-needed cash -- this in a year in which Obama could spend $300 million. And he could boost McCain in Virginia, a state that Obama is furiously targeting -- and that could tip the whole election if it flips to the Democrats for the first time since 1964. Cantor only represents a small part of the state, and his presence probably wouldn't add more than one percent to McCain's statewide total (if that) -- but have you seen how close the polls are there?

Cantor's prospects are further aided by the dearth of top-tier options for McCain. Mitt Romney looms as his most logical selection and Tim Pawlenty has been the subject of plenty of speculation. Pawlenty would bring very little to the ticket, while Romney might be helpful in Michigan and with money. But his negative ratings are high and there could be some lingering resentments from the primary season. Beyond those two, there are no other obvious prospects for McCain to consider. If he's looking for a non-Romney/Pawlenty option, why not Cantor?

Chances are that there won't be a House member on either party's ticket for the sixth straight election. But if there's going to be one this year, it will almost certainly be a Republican.

The image began taking hold in the media last week, when Obama rationalized his way out of a previous commitment to make a good-faith effort at participating in the public financing system for the general election.

Given his earlier cutesiness on Nafta, his now infamous 130 “present” votes in the Illinois legislature and his penchant for blaming his staff for his own mistakes, the campaign funding flap could serve as a tipping point in the media’s portrayal of Obama. Something very similar happened to Jimmy Carter at this same point in his victorious 1976 campaign, when a media that had watched his stunning run through the Democratic primaries with fascination and awe suddenly began demanding specificity.

The Republicans see a real opportunity here. The party’s familiar public faces fanned out over the weekend to play up this new caricature: McCain and surrogate adviser Carly Fiorina on Face the Nation, Representative Eric Cantor on CNN’s Late Edition, and, providing by far the most polished and indignant twist on the G.O.P.’s talking points, Senator Lindsey Graham on Meet the Press.

“He seems to be willing to say or do anything for the moment to advance his cause,” Graham said. “And his cause is to win the election. It's not to change this country, and that's sad.”

If the Republican drumbeat continues and the media adopts a more cynical filter for Obama’s strategic moves and policy pronouncements, it’s not hard to imagine this perception taking hold among the masses – especially if Obama himself plays into it. And in theory, that should be devastating for him, particularly if John McCain is able to maintain his own reputation for political independence and courage.

But maybe not. To read some of the criticism of him in the past week is to believe that Obama has broken new ground in the chutzpah department. “Even Bill Clinton,” David Brooks wrote in a widely distributed column last week, “wasn’t smart enough to succeed in politics by pretending to renounce politics.”

Perhaps Clinton didn’t, but Carter certainly did. In his 1976 campaign, Carter presented himself very much like Obama does now, as a unifying postpartisan reformer bursting onto the scene to rescue a dispirited country from deep political, cultural and ethnic polarization. Carter carried himself as the second coming of Jimmy Stewart’s Mr. Smith, a simple, honest peanut farmer from Georgia as outraged and bewildered as the rest of America at the ways of Washington. His platform was rooted in feelings, not a laundry list of policy proposals.

“I’ll never lie to you,” Carter promised a country still recovering from Watergate.

In reality, Carter and his campaign were anything but wide-eyed naïfs. He had set his eyes on the presidency years earlier and set out to run while the 1972 campaign was still going on. Guided by his young aide Hamilton Jordan, Carter executed a sophisticated strategy that recognized and exploited Americans’ yearning for a leader in whom they could trust and from whom they could draw inspiration.

It took the media and the Republicans just about as long to catch on to Carter’s craftiness as it did for them to begin exploring Obama’s Machiavellian side. In the summer and fall of ’76, reporters attempted day after day to pin Carter down on the most politically sensitive issues of the day -- abortion, busing and the like. And day after day he frustrated them with his evasiveness. Republicans howled, sounding very much like Lindsey Graham did on Meet the Press.

What’s most noteworthy about the Carter case is that eventually press frustration and the Republicans’ attacks did trickle down to the masses, and voters did conclude that Carter was not being straight with them on every issue. The election ended up being close – a series of unrelated missteps in the fall also took a toll on Carter – but voters still ended up electing Carter, even though they’d concluded that he was much more of a political animal than he presented himself as being.

That’s because the attacks did not fundamentally alter the public’s view of Carter: They liked him personally and found him honest and trustworthy at the outset of the campaign, and they still did at the end. In essence, voters in 1976 said that they understood that in a campaign, candidates have to act like politicians.

They sent a similar message in 1992, when Clinton unseated George H. W. Bush. In the spring of ’92, after Clinton emerged from a host of scandals as the Democratic nominee, Bush and the G.O.P. believed he would be utterly unelectable, so miserable were Clinton’s poll numbers when it came to questions of honesty, trustworthiness and basic character. Clinton’s need to have it both ways on every issue became an immortal punch line when he responded to a question about whether he’d ever tried marijuana by saying, “Yes. But I didn’t inhale.”

But he was elected comfortably because voters, as they began to meet him through television, warmed up to him personally. They never forgot about all of the baggage that he accrued, but his comforting onscreen presence and his masterful communication skills (on display in the three fall debates) thoroughly convinced voters that his character flaws were insignificant compared to his intelligence, his understanding of the country’s problems and the new energy he’d bring to Washington.

Voters are inured to presidential nominees from both parties who pander, flip-flop and equivocate on the campaign trail. If that’s all they see – a typical politician – then that candidate is in trouble, as John Kerry and Al Gore can attest. But Obama is an entirely different candidate, the first Democratic nominee since Clinton – and the second since Carter – that most people instinctively like.

He and his campaign have calculated that a broken promise here and there won’t fundamentally change that. They’re probably not wrong.