To fix Social Security, we should first stop using the Consumer Price Index to adjust benefits for inflation. Using the C.P.I. overstates the impact of inflation and has also led to larger increases in benefits for Social Security recipients than the income gains of typical American workers.

Finally, let's keep well in mind the most important lesson of the auto rescue: While government should stay away from the private sector as much as possible, markets do occasionally fail, and when they do government can play a constructive role, as it did in the case of the auto rescue.

Not surprisingly, troubled economic times often beget proselytizers of wacky, extreme ideas.

Conservatives brayed that government should stay out of the private sector; liberals bleated for nationalizing the banks.

To be sure, India has achieved enviable success in business services, like the glistening call centers in Bangalore and elsewhere. But in the global jousting for manufacturing jobs, India does not get its share.

As a beneficiary of the carried interest loophole, I've seen firsthand the lack of any difference between the work involved in generating a carried interest and the work done by millions of other professionals who are taxed at the full 35 percent rate.

The weak economy, widening income inequality, gridlock in Congress and a presidential election: Those were perhaps the dominant economic and political themes of 2012.