Harold Meyerson's reply to Markos Moulitsas' essay making "The Case for the Libertarian Democrat" has been posted at Cato Unbound. A snippet:
The Democrats' embrace of individual liberties in many spheres is actually an old story. But the new growth of selective libertarianism in the Democratic ranks is hardly going to be the main source of controversy in coming party debates. More likely, that debate will pit those who think retraining is the answer to our more layoff-prone society (that's the Bob Rubin solution) against those who think that retraining needs to be supplemented by, for instance, publicly funded alternative energy programs that would generate millions of jobs (that's the solution of a number of union leaders, and one that I favor as well). The latter position is clearly more in the New Deal liberal mode, but Rubin's is hardly libertarian. Ultimately, the Democrats aren't going to proceed very far down the libertarian road, for one simple reason that's far more pragmatic than philosophic: It doesn't lead anywhere.
Whole thing here.