04/06/2010 05:12 am ET Updated May 25, 2011

Knowing When To Pick A Fight

One of the toughest decisions to make in politics is figuring out the right time to compromise and the right time to pick a fight and see the fight through. As that great verse from Ecclesiastes says so well, there is a time for every season under heaven. Being willing to make modest compromises has resulted in some of the greatest legislation in American history, but it has also been a fiasco at times. Knowing the right time to pick a fight (think Bill Clinton during the 1995 government shutdown fight with Gingrich) can be absolutely transformative for a politician.

The whole legacy thing sometimes clouds the judgment of even the best politicians on when to compromise and when to stand tall. My all-time favorite Senator, the best and most effective in history in my opinion, was Teddy Kennedy, but toward the end of his career he got snookered by the Republicans twice, in part because I think he was thinking a little too much about his legacy: on No Child Left Behind, where Bush promised him a lot for money for education and then broke his promise after the bill was passed; and on the Medicare drug bill a couple of years later, where the decent compromise he forged in the Senate got rolled in the Republican controlled conference committee, and they passed a bill that was a pure giveaway to the pharmaceutical industry.

Unfortunately, another fine Senator, Chris Dodd, is letting the legacy thing cloud his judgment. Dodd is complaining about President Obama's strong new push for a more progressive financial reform policy. Yesterday, in a committee hearing, Dodd said that the new proposals are "adding to the problems of trying to get a bill done...I don't want to be in a position where we end up doing nothing because we tried to do too much at a critical time." Dodd has been working closely with Republicans on the Finance Committee in the hopes of getting a compromise that can get 60 votes, and all of a sudden the White House is upsetting the applecart by pushing for more. Dodd knows that he needs Republican support to pass a bill in the Senate, and that to get Republican support he has to have a bill acceptable to the big banks. With him retiring, he wants one final legislative feather in his cap, so if he needs to cut a deal with the big banks, he'll do it.

Now I admire Chris Dodd a great deal. He has spent a career on the frontlines fighting for poor kids and families, and against stupid wars. But on this issue he is dead wrong. His legacy is just fine without adding a watered down and ultimately ineffectual financial reform bill to his list of legislative accomplishments. What is needed now, both for Democratic political prospects in general and to make the policy effective in reining in the power and excesses of Wall Street, is to pick the fight with the Republicans and bank lobbyists. As President Bush might have said, bring it on.

There are two dimensions to this, one on the policy side and one on the political. It is a simple fact that the longer this issue stews, and the more high-profile pressure is placed on the big bank lobbyists, the better the policy we are going to get in terms of doing things that really matter in terms of financial reform. If you tell the Republicans on the committee that we are only going to do this in a bipartisan way and we want to make you comfortable with signing off on the legislation, it puts them in the catbird seat, and the legislative language we get becomes gruel real fast. If on the other hand we raise the stakes, say (like the President in the State of the Union) that we're only going to do financial reform if we can do it right, and really start banging the Republicans for doing Wall Street's bidding, I think that after a few weeks on the grill will make at least a couple of them far more likely to agree to something real. Once it gets to the floor: if the Republicans threaten filibuster, tell them to go ahead and make our day. Bring the bill up, debate really popular amendments, and let them keep blocking a vote on the issue. I suspect that it wouldn't take very long for the Republicans to decide that we ought to let this bill pass rather than face week after week of getting public heat for being the big bankers' best buddies.

On the politics of this, Democrats have nothing but upside in picking a fight and letting it cook for a while. Every day that Democrats are seen as trying to pass the strongest possible bill to hold the banks accountable, and every day that Republicans are seen as helping Wall Street block it, is a good day for the Democrats in terms of the 2010 elections. Democrats have the political high ground here, and they damn well ought to use it to get a better bill.

Senator Dodd, I love ya like a brother. You already have a great legacy. Don't tarnish that legacy by having the final act of your long and distinguished Senatorial career being giving the big banks and their Republican allies everything they want in order to get easy passage of a watered down bank bill, hurting both the economy and your party in the process. It's time to pick a fight.

Update: Check out this article from WSJ that talks about how Republicans are running to Wall Street donors, telling them it's the Republicans who will save them from any financial reform legislation that would actually do anything to them. All the more reason to raise the stakes on this fight and go for it. Wall Street is going into high whine mode about mean old Democrats attacking them. Good. Now let's go the mat, and win the fight both on policy and politically.