The highest-income Americans don't need tax-free health insurance, mortgage interest deductions or deferred taxation on retirement funds.

Well, maybe not death panels, exactly, but unless we start allocating health-care resources more prudently – rationing, by its proper name – the exploding cost of Medicare will swamp the federal budget.

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

Most troublesome is the legalization of 'crowd funding,' the ability of start-up companies to raise capital from small investors on the Internet.

Increased revenues, meaning higher taxes, will be a central element of any successful long-term budget plan, and President Obama is right to insist that the wealthy - the slice of America that has come through the recession in by far the best financial health - should provide those funds.

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.

Neither the George W. Bush nor the Obama administrations volunteered to bail out G.M., Chrysler and other parts of the auto sector. Both subscribed firmly to the longstanding American principle that government should resolutely avoid these kinds of interventions, particularly in the industrial sector.