TOO SMALL TO FAIL.... The impact of the financial crisis on the banking industry has been pretty obvious, with most of the financial services industry in turmoil. But there's part of this story that's been largely overlooked: humble local banks are doing quite well, thank you.

In the soon-to-be-released issue of the Washington Monthly, Phillip Longman, a senior fellow at the New America Foundation, and T. A. Frank, an Irvine Fellow at the New America Foundation and an editor here at the Monthly, highlight the surprising resilience of smaller, local banks in a terrific piece that is now available online.

Easily overlooked amid the crisis of big banks today, small-scale financial institutions are, for the most part, holding steady -- and sometimes even better than steady. According to FDIC data, the failure rate among big banks (those with assets of $1 billion or more) is seven times greater than among small banks. Moreover, banks with less than $1 billion in assets -- what are typically called community banks -- are outperforming larger banks on most key measures, such as return on assets, charge-offs for bad loans, and net profit margin.

Longman and Frank also explain how smaller community banks and credit unions remained solvent and profitable (and continue to make loans) through old-fashioned "relationship" banking, while the Wall Street behemoths were "efficient" mainly at wasting trillions of dollars in global capital.

Perhaps most importantly, their piece explains what lessons are available to policy makers from these trends, as a new global finance architecture comes together. Take a look.

What's more, Longman and Ellen Seidman, director of financial services policy at New America, who contributed substantially to this article in the Monthly, will participate in a forum tomorrow at the New America Foundation discussing the points raised in the piece, and answering questions on the subject. For readers in the D.C. area, here's a link to the schedule for Thursday's event. If you're outside the beltway and want to tune in, there will be a live webcast. The event begins at 12:15 p.m. eastern.

WEDNESDAY'S MINI-REPORT.... Today's edition of quick hits:

* Another painful day on Wall Street, with the Dow falling 427 points. It closed just below the 8,000 mark, a five-year low.

* On a related note, in October, the Consumer Price Index experienced its steepest single-month drop in the 61-year history of the pricing survey.

* Obama's transition team made a few more announcements official this afternoon. David Axelrod will a senior advisor to the president; Greg Craig will be White House Counsel; Chris Lu will be Cabinet Secretary; and Lisa Brown will be Staff Secretary.

* Henry Waxman took one step closer today to beating out John Dingell for the chairmanship of the House Energy and Commerce Committee. The House Steering Committee voted 25-22 to approve Waxman for the post. The House Democratic caucus will vote tomorrow.

* Four years ago, Bush won Salt Lake County, Utah, by 20 points. This year, Obama narrowly won the same county.

* Sam Stein has a terrific report on the closed-door Democratic caucus meeting that decided Lieberman's fate.

* Joe Conason argues there's nothing wrong with Obama keeping Robert Gates around as the Defense Secretary.

* The combination of the weak economy and declining violence in Iraq has boosted the number of young people considering military careers.

* Republicans seem to have some grudging respect for Dean's 50-state strategy.

* Nice to CNN's John King have a little fun with "The Daily Show's" John Oliver.

* Nate Silver has a fascinating chat with right-wing activist John Ziegler.

* Joe Scarborough's judgment is so bad, he can get politics and arithmetic wrong in the same sentence.

* Bill O'Reilly's website promotes a "holiday" reading list, instead of a "Christmas" reading list. One wonders, of course, whether O'Reilly will launch a boycott against himself.

Anything to add? Consider this an open thread.

MCCAIN WINS MISSOURI.... It took a little longer than expected, but we now know the results of the presidential race from all 50 states and the District of Columbia. Missouri, the lone holdout, was called today for McCain.

With all jurisdictions reporting complete but unofficial results, McCain led Obama by 3,632 votes Wednesday out of more than 2.9 million cast -- a margin of 0.12 percentage points.

Both men spent considerable resources trying to win Missouri, a state that Obama ultimately did not need for his national victory.

Obama won 365 electoral votes. Missouri's 11 electoral votes will give McCain 173.

McCain's win breaks Missouri's long-standing streak -- in every election since 1956, the winner of Missouri's electoral votes won the presidency. (Before 1956, Missouri had backed the eventual winner in every race dating back to 1904.) So much for that "bellwether" talk.

The best part about today's announcement? Those red and blue maps that have featured a hole right in the middle have finally been completed. It's as if the presidential is finally over.

AND THEN THERE WERE 58.... I was holding off a bit, waiting to see if there'd be a statewide recount, but thankfully, Senator and convicted felon Ted Stevens (R-Alaska) conceded this afternoon.

Alaska Sen. Ted Stevens has conceded defeat to Democratic challenger Mark Begich in the Alaska Senate race.

Stevens, 85, was the longest serving Republican senator in the chamber's history.

"Given the number of ballots that remain to be counted, it is apparent the election has been decided and Mayor Begich has been elected," Stevens said in a statement."

Stevens' concession officially makes Anchorage Mayor Mark Begich a senator-elect, and officially brings the Senate Democratic caucus to 58. There are, of course, two remaining races that are unresolved: Minnesota (where a statewide recount began today) and Georgia (where there will be a runoff election on Dec. 2).

The resolution in Alaska has, of course, renewed discussion of a possible 60-seat majority -- in theory, filibuster-proof -- pending the last two contests. Just to reiterate a point from last week, it's best not to make too big a deal about this threshold.

Yes, every vote counts, and Republican obstructionist tactics are a given, but every major vote brings it own challenges, and there's never a guarantee that everyone in the Democratic caucus will vote together (Lieberman is, after all, part of the caucus). For that matter, there's no reason to believe that every Republican is necessarily going to back their party on cloture votes.

In fact, the real fun of the next Congress will be how center-right Republicans from "blue" states -- Snowe, Collins, Voinovich, and Specter, I'm looking in your direction -- respond to popular policy proposals launched by a popular Democratic president.

A 60-seat majority would be a milestone for the party, but it's hardly a green light to problem-free governing. Something to keep in mind.

TEAM OF RIVALS.... Doris Kearns Goodwin's "Team of Rivals," about Abraham Lincoln stocking his cabinet with his political enemies to help forge political reconciliation, has been getting more than its share of attention. The President-elect has not only talked about how much he enjoyed the book, but as everyone political commentator with an audience seems to have emphasized, Obama also seems to be following in Lincoln's example as something of a template.

Matthew Pinsker, who teaches Civil War history at Dickinson College, had a fascinating opinion piece in the LA Times yesterday, responding to Goodwin's thesis, and noting that Lincoln's "team of rivals" was actually pretty dysfunctional, and not an especially good idea to begin with.

As Pinsker explained, Lincoln ended up ignoring close allies, while promoting enemies, several of whom created practical and political trouble for the president. Most quit during Lincoln's first term.

Over the years, it has become easy to forget that hard edge and the once bad times that nearly destroyed a president. Lincoln's Cabinet was no team. His rivals proved to be uneven as subordinates. Some were capable despite their personal disloyalty, yet others were simply disastrous.

Lincoln was a political genius, but his model for Cabinet-building should stand more as a cautionary tale than as a leadership manual.

Fair enough. But as tempting as it may be to connect Obama's approach to Lincoln's, and as much as the transition team probably likes the comparison to American hero/icon for public consumption, I'm not sure if the similarities are especially compelling.

At this point, literally zero cabinet announcements have been officially announced, but we're pretty sure about two cabinet spots (Daschle at HHS and Holder at Justice), and equally sure about one cabinet-level spot (Orszag at OMB). All three are highly qualified, and none of the three was ever an Obama "rival."

Now, for Secretary of State, Obama appears to be considering Hillary Clinton and Bill Richardson, both of whom challenged Obama for the Democratic nomination. But as Kevin noted today, "[O]ne cabinet spot hardly counts as a team, does it?"

What's more, a team of rivals probably won't come together, in part because there's a limited number of rivals to consider. Biden wasn't a rival for very long, and he's the Vice President. Edwards hasn't quite made a comeback. Clinton or Richardson may get to take the reins at Foggy Bottom, but only one will probably be in the cabinet. Dodd is staying in the Senate, Kucinich is staying in the House, and Gravel is, well, probably wondering around somewhere, but has no shot at a government post.

The team may have a rival or two, but that's it. The Lincoln comparison just doesn't hold up well.

EVEN THE BUSHIES.... When it comes to the Bush administration's environmental policies, there's a fairly predictable pattern -- scientists will weigh in, career EPA employees will agree with them, and Bush's political appointees will ignore all of them.

This one, though, is a little unusual.

The Environmental Protection Agency is finalizing new air-quality rules that would make it easier to build coal-fired power plants, oil refineries and other major polluters near national parks and wilderness areas, even though half of the EPA's 10 regional administrators formally dissented from the decision and four others criticized the move in writing.

Documents obtained by The Washington Post show that the administration's push to weaken Clean Air Act protections for "Class 1 areas" nationwide has sparked fierce resistance from senior agency officials. All but two of the regional administrators objecting to the proposed rule are political appointees.

Got that? Several regional EPA administrators are opposing Bush's new air-quality rules for national parks and wilderness areas, despite having been appointed by Bush.

And how bad are the proposed rules? Pretty bad.

The proposal would change the practice of measuring pollution levels near national parks, which is currently done over three-hour and 24-hour increments to capture emission spikes during periods of peak energy demand; instead, the levels would be averaged over a year. Under this system, spikes in pollution would no longer violate the law.

Obama really will have a lot to do, won't he?

BOEHNER'S LUCK.... The result was a foregone conclusion, but the House Republican caucus made it official this afternoon, choosing to keep House Minority Leader John Boehner (Ohio) as their leader. The vote count hasn't been released, but he reportedly "handily defeated" challenger Rep. Dan Lungren (Calif.).

This wasn't a surprise, but the decision is nevertheless odd. Indeed, Eve Fairbanks had a good piece this morning, explaining that the GOP support for Boehner "seems nothing short of crazy."

In 1998, Newt Gingrich lost the GOP less than ten House seats and was promptly defenestrated. Boehner has not only presided over the loss of more than fifty seats for the party, but he also suffered a humiliating defection by rank-and-file conservatives on September's bailout bill -- a mutiny that I was certain, then, presaged a bigger challenge to his rule by young right-wingers after the election.

But no, House GOPers are taking Boehner back: It's as though the captain of the Titanic survived and got tapped to run another transatlantic cruise.

I pretty much expected Boehner's leadership role to be over after the October debacle on the Wall Street bailout. He helped negotiate the deal, urged his Republican members to follow his lead, and they blew him off entirely. Afterwards, Boehner blamed Speaker Pelosi for his own failure, saying she hurt GOP lawmakers' feelings.

And yet, Boehner continues to thrive. How? Fairbanks took a closer look at how Boehner handled the bailout mess, and why it's illustrative of his staying power.

Although Boehner technically backed the first, failed bailout bill, he artfully managed to appear to both support and oppose it at the same time. Boehner coined an instant anti-bailout rallying cry when he derided the bill as a "crap sandwich"; then, hours later, he minted himself a pro-bailout hero by hamming it up for the bill on the House floor, weeping and pleading, "What's in the best interest of our country? Vote yes!" The Oscar-worthy performance left both moderates and right-wingers impressed. Pro-bailout pundit Norm Ornstein placed Boehner in the pantheon of politicians who "transcended the partisan divide ... because they believed the country needed it," while anti-bailout agitator Newt Gingrich marveled on cable TV that Boehner had enabled conservative opposition.

It's a nice trick.

I still marvel at the history, though. Boehner was Majority Leader when his caucus lost 30 seats in 2006, and was Minority Leader when his party lost 24 more seats in 2008. When was the last time a party stuck with a leader after such devastating failures?

PRIVATE JETS.... Alan Mulally, CEO of Ford, understands the importance of symbolic gestures and public relations. Yesterday, for example, when he arrived on Capitol Hill, hat in hand, hoping to convince lawmakers to help bail out American auto manufacturers, he arrived in a new Ford Fusion Hybrid. Ford's media team, of course, made sure reporters knew about this.

The goal wasn't necessarily to impress members of Congress, who wouldn't see Mulally's arrival; it was for our benefit. Showing up in a hybrid was supposed to convey to all of us that Ford is thinking ahead and taking innovation seriously.

If only Ford's p.r. team had thought about the other leg of the trip. How one gets to the Hill from the hotel isn't quite as interesting as how one gets from home to D.C.

The CEOs of the big three automakers flew to the nation's capital yesterday in private luxurious jets to make their case to Washington that the auto industry is running out of cash and needs $25 billion in taxpayer money to avoid bankruptcy.

The CEOs of GM, Ford and Chrysler may have told Congress that they will likely go out of business without a bailout yet that has not stopped them from traveling in style, not even First Class is good enough.

All three CEOs -- Rick Wagoner of GM, Alan Mulally of Ford, and Robert Nardelli of Chrysler -- exercised their perks Tuesday by flying in corporate jets to DC. Wagoner flew in GM's $36 million luxury aircraft to tell members of Congress that the company is burning through cash, asking for $10-12 billion for GM alone.

GM's Wagoner parked his G4 private jet at a nearby airport. It's one of a fleet of GM-owned luxury jets used to ferry executives around the world. Ford's Mulally has access to a jet as part of his $28 million employment contract; it's one of eight private jets Ford owns for its executives.

If these guys had flown commercial first-class, while their companies are teetering on the brink, it would have been embarrassing. But company-owned private jets?

I've seen some persuasive arguments, most notably from Jonathan Cohn, on government intervention to rescue the auto industry. But a) these CEOs aren't helping; and b) they'll probably have to be replaced as part of any rescue plan.

DASCHLE TO HEAD HHS?.... Even before the election, drafts of what an Obama cabinet might look like had former Senate Majority Leader Tom Daschle taking the lead at HHS. If the reports today are accurate, that's exactly what's going to happen.

Three sources close to the transition and in a position to know tell CNN that former Sen. Tom Daschle is President-elect Barack Obama's choice to be Secretary of Health and Human Services and the former Senate Majority Leader has indicated he wants the job.

Most significantly, Daschle negotiated that he will also serve as the White House health "czar" -- or point person -- so that he will report directly to the incoming President. The significance is this guarantees that by wearing two hats Daschle, and not White House staffers, will be writing the health care plan that Obama submits to Congress next year.

The sources said the precise timing of the announcement has not been worked out, but Daschle is likely to officially join the Obama transition team as the lead adviser on health issues in the next few weeks.

Roll Call, I believe, was the first to report the news.

The Daschle announcement reinforces the notion that an Obama administration is going to take the push for healthcare reform very seriously. A senior Democratic official told Mike Allen, "Of all the proposals that Obama wants to enact, health care requires the most input and tough negotiations and shepherding. No one knows the House and Senate like Tom Daschle."

Indeed, the Daschle news makes me even more encouraged about the prospect of a healthcare package actually passing. Emanuel is insisting that an incremental approach won't do; Baucus and Kennedy are laying the groundwork on the Hill; and Daschle has been preparing for this fight for quite a while.

For more on what to expect in terms of the policy debate, you can also check out Daschle's recent book about healthcare policy, and Ezra's interview with him on the subject earlier this year.

Update: Jonathan Cohn has more, including why this is the "perfect role for Daschle," and why this is "good news for health reform."

EMANUEL VOWS TO 'THROW LONG AND DEEP'.... My biggest concern about Rahm Emanuel becoming the next White House chief of staff is his record of incrementalism.

With that in mind, it was hard not to find his comments yesterday very encouraging. Talking to a group of CEOs and business leaders, Emanuel said incremental changes wouldn't be enough, and urged his audience to work with the Obama administration's push for universal health care.

"When it gets rough out there, a lot of business leaders get out of the car and say, 'We're OK with minor reform.' I'm challenging you today, we're going to have to do big, serious things," Rahm Emanuel said, speaking to The Wall Street Journal's CEO Council, a conference convened to elicit corporate opinion on the challenges facing the new president. [...]

Mr. Emanuel promised that a major economic stimulus would be "the first order of business" for Mr. Obama when he takes office Jan. 20. The focus of spending will be on infrastructure, specifically "green infrastructure," which he said would include mass transit, upgraded electricity transmission lines, "smart" electrical meters that allow consumers to save money by using electricity at off-peak hours, and universal broadband Internet access, which he said would encourage telecommuting.

He stressed that the new administration would "throw long and deep," taking advantage of the economic crisis to push wholesale changes in health care, taxes, financial re-regulation and energy. "The American people in two successive elections have voted for change, and change cannot be allowed to die on the doorsteps of Washington," Mr. Emanuel said.

The Wall Street Journal posted the video of Emanuel's remarks.

Greg Sargent noted, "While the devil will of course be in the details, the fact that Rahm himself is setting the bar very high for the incoming administration's expected health care reform efforts is welcome."

Quite right. This didn't sound like an incrementalist, promising to go slow and work around the edges; it sounded like someone ready to help the president make real changes real soon.

The reports didn't indicate how Emanuel's remarks were received by the business audience, but they have every reason to get onboard with the Obama agenda, especially on health care.

WEDNESDAY'S CAMPAIGN ROUND-UP....Today's installment of campaign-related news items that wouldn't generate a post of their own, but may be of interest to political observers.

* The recount begins today in Minnesota's closely watched Senate race between Norm Coleman and Al Franken. Coleman goes into the process with a 0.008% lead. With nearly 3 million votes to review, the process is expected to take several weeks.

* In Georgia, home to the other unresolved Senate race, incumbent Saxby Chambliss is running more attacks ads, this time going after Barack Obama's tax plan. As Eric Kleefeld noted, "To the best of our knowledge, this is the first attack ad out there that has gone after Barack Obama since he won the election (not counting Fox News promos)." The runoff election is on Dec. 2.

* Speaking of the Georgia race, Bill Clinton will be in Georgia campaigning for Jim Martin today.

* Al Gore will be in Georgia in support of Martin on Sunday.

* Michael Steele, hoping to become the next chairman of the Republican National Committee, lashed out yesterday at the party's "country club" mentality.

* Hoping to end speculation about his future, John McCain announced yesterday that he will seek re-election in 2010. If Gov. Janet Napolitano (D) takes him on, as has been rumored, it will certainly be the toughest race McCain has faced in Arizona.

* And Sarah Palin, in the latest sign of her efforts to secure party support for a future campaign, has already agreed to be a featured guest at the 2009 Conservative Political Action Conference (CPAC). John McCain will reportedly not be invited to the event.

WHEN WAS THE GOP'S FACTIONAL WARFARE?.... The Washington Post's Chris Cillizza, writing before yesterday's caucus vote on Joe Lieberman, offered an odd assessment of the political landscape.

Asked what it would mean if Lieberman kept his chairmanship, one Senate Democratic aide said bluntly: "The left has been foiled again. They can rant and rage but they still do not put the fear into folks to actually change their votes. Their influence would be in question."

That's one way to look at it. The other is that the left would be up in arms and far less willing to go along and get along with President-elect Barack Obama's agenda -- particularly if it doesn't contain the appropriate progressive tilt.

These are the problems of power, the same problems that Republican experienced following the 2000 election. The GOP's inability to make peace between its warring ideological factions led to its decline in 2006 and fall in 2008. Can Democrats avoid the same fate?

Now, plenty of my colleagues have talked about the first paragraph, on the netroots' efforts to "put the fear into folks." But that last paragraph that struck me as even more confusing.

As Cillizza sees it, the Republican Party has been burdened by ideological conflicts throughout Bush's presidency, which apparently led to the party's troubles over the last couple of cycles.

I'm afraid Cillizza has it completely backwards. When was it, exactly, that Republican endured "warring ideological factions"? In our reality, GOP policy makers were in line with the Bush White House every step of the way, and voted with the president's wishes throughout the first six years of his presidency.

And that, of course, was the problem. Republican lawmakers latched onto a failed and unpopular president, and endorsed his policies that didn't work. Voters disapproved and voted them out. There were no "warring ideological factions" in the GOP -- the party might have been better off if there were.

I heartily endorse Steve M.'s incredulity: "Is that really why insider journos think the GOP had trouble at the polls in the last two elections? Because the GOP and the right weren't in lockstep enough? Was I smoking crack for the last eight years? Did I imagine the near-total absence of GOP/right-wing dissent on the war, torture, surveillance, the tax cuts, deregulation, social programs, and dozens of other issues?"

SORE LOSER WATCH.... I imagine it's traumatic losing a close campaign one expects to win, but Rep. Marilyn Musgrave, a very conservative Colorado Republican, seems to be taking her Election Day defeat to Democrat Betsy Markey a little too hard.

Musgrave, a Republican who's been representing Colorado's 4th District since 2002, became part of the Republican Casualty List when she lost in a landslide, even after the National Republican Congressional Committee doled out almost a million bucks (reportedly $900,000) for her campaign.

Two weeks after the brutal loss, Musgrave still hasn't called her opponent to concede or to congratulate the victor, as is not only textbook but also mannerly to do.

Moreover, Musgrave's ill manners bleed into her own team. Rumor has it she still -- 14 days later -- hasn't even thanked her campaign staff. (Again, textbook.)

Musgrave press secretary Joseph Brettell tells us: "It's a campaign matter, and I have no further comment."

Making matters slightly worse, it seems no one has seen or talked to Musgrave since her 12-point defeat. "[S]he's all but disappeared," the Politico's Anne Schroeder Mullins reported.

It sounds rather alarming.

KATHLEEN PARKER TAKES ON THE RELIGIOUS RIGHT.... In September, Kathleen Parker, a conservative syndicated columnist, raised quite a few eyebrows when she explained that Sarah Palin had no business running for national office. "If BS were currency, Palin could bail out Wall Street herself," Parker said, before urging Palin to quit the Republican ticket. She was rewarded with literally thousands of angry right-wing emails.

Parker, to her enormous credit, continues to push back against conservative orthodoxy. In a Washington Post piece today, she encouraged the Republican Party to realize that its religious-right base is a leading cause for the party's electoral troubles.

[T]he evangelical, right-wing, oogedy-boogedy branch of the GOP is what ails the erstwhile conservative party and will continue to afflict and marginalize its constituents if reckoning doesn't soon cometh.

Simply put: Armband religion is killing the Republican Party. And, the truth -- as long as we're setting ourselves free -- is that if one were to eavesdrop on private conversations among the party intelligentsia, one would hear precisely that.

The choir has become absurdly off-key, and many Republicans know it.

But they need those votes! So it has been for the Grand Old Party since the 1980s or so, as it has become increasingly beholden to an element that used to be relegated to wooden crates on street corners.

Parker is surprisingly candid in her assessment, criticizing the Republican Party for having "surrendered its high ground to its lowest brows." By becoming the party of the Dobsons and Robertsons of the world, the GOP, Parker insists, has alienated "other people of faith (those who prefer a more private approach to worship), as well as secularists and conservative-leaning Democrats who otherwise might be tempted to cross the aisle."

She concludes that the Republican Party may ultimately "die out unless religion is returned to the privacy of one's heart where it belongs."

On the substance, I think the GOP would be wise to take Parker's advice seriously. The party is likely to do the opposite, but presenting itself to a modern, diverse population as the party of religious fundamentalists and, to borrow a phrase, "agents of intolerance," will help Republicans thrive in the Bible Belt -- and nowhere else.

As for Parker, I shudder to think how many emails she'll get once this column makes the rounds. She's offering the GOP some very sound advice, but that won't matter after the Family Research Council and Focus on the Family make her their new Public Enemy #1.