What next?

Health Care Reform was the biggie - the thing that Democrats had been pushing for for decades, the expansion of the social safety net that puts us in line with the European and East Asian rich countries. I'm not hugely enthused about it, but I'm glad it happened, because A) I think it'll improve the quality of care, and B) because I think it opens the door for stringent cost-control measures.

But now it's time to move on to other things. In the wake of what is unquestionably a massive, epochal victory for the Democrats, President Obama will have the opportunity to pursue more needed reforms. A quick rundown of the ones I think are more and less important:

1. Financial Reform. Everyone agrees this is next on the docket. And it's something we need to do. Politically, we probably need to do it immediately, while the pressure is there, even though policy-wise it probably won't matter until the next financial crisis rolls around in five years or so. And people should understand that no financial reform will permanently prevent financial crises, because financiers will always find ways around any restrictions on their activities (look at how the "shadow banking system" managed to evade Roosevelt-era restrictions on banking). But financial reform will make the next bubble smaller and less damaging to our economy. It's just a shame Obama will have to spend so much political capital to push it through, when the effect will be so limited.

2. Carbon Tax. Also called "cap and trade", this would be a great idea if the U.S. were the entire world. We are not, so it is a resoundingly mediocre idea. If we curb our use of carbon and China doesn't, our carbon tax will simply make fossil fuels cheaper for them; they will use more, and the same amount of carbon will get dumped into the air, except that their economy will grow and ours will shrink. On the plus side, a carbon tax would spur the development of alternative energy technologies by U.S. firms, which will be to our great advantage when oil runs out. Overall, though, this thing is definitely not worth spending one iota of political capital on. Let it quietly die.

3. Immigration Reform. Now THIS is a big one. At stake is the assimilation of ten million illegal immigrants, who will not go to English-speaking schools or get good jobs unless they are given amnesty. Unless we want to create a semi-permanent underclass of non-English-speakers highly localized in the Southwest, we had better give that amnesty. And on the high end, we need LOTS more high-skilled immigrants to maintain our competitive edge, and letting in smart folks from other countries will help narrow our massive income gap. The only people who lose from immigration reform are the people who think America is for whiteys only. They should be ignored, of course.

4. Health Care Reform 2. The first bill expanded coverage and banned a lot of nasty counterproductive insurance industry practices. Good. But whether government spends the money or the private sector spends the money, we are spending way, way, way too much on health care, and it's getting worse fast. The only way to save our nation from bankruptcy is a second health care reform bill - one focused exclusively on controlling costs. This will have to come after the current bill kicks in in 2013, so we're talking about Obama's second term, but the administration needs to start laying the groundwork now, and making cost control one of the centerpieces of the 2012 campaign.

There are a lot more policies we need to get our country out of the hole we dug for ourselves in the last 10 years - rebuilding infrastructure, reducing the deficit, addressing the trade imbalance with China. But reforming our institutions - finance, immigration, and health care costs - is extremely important, because institutions last for a long time and are very hard to reform. There is no time to waste.