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Progressive Breakfast: Thinking Big

Thinking Big Conference TODAY, 9-5, featuring Paul Krugman and many others. Live streaming available at ABC’s The Note reports: “Wednesday’s 800-person gathering, which is taking place at the Capital Hilton Hotel in Washington, D.C., is intended to make the case that ‘jobs-based growth’ and a ‘broadly shared prosperity’ will require far more than a short-term stimulus.”

New Pro-Econ Recovery Ads: No Is Not an Option

The Plum Line reports:

President Obama’s allies on the left, AFSCME and the labor-backed Americans United for Change, are ramping up with a massive advertising blitz containing the most direct and hard-hitting attack yet on specific GOP leaders, demanding that they get behind the recovery package and stop saying “No.”
White House aides were told in advance what the concept of the ads would be, though they were briefed while the ad was in production, according to a Democrat familiar with the discussions. The ad, which is running nationally on cable, goes considerably farther than Obama and the White House has in directly calling out Republican leaders, flashing images of GOP Reps John Boehner and Eric Cantor, and Senator Mitch McConnell.
The ad — which is accompanied by a big targeted radio ad blitz hitting 18 GOP House members and three Senators opposing the plan — is a sign that Obama and his advisers won’t try to get in the way as allied groups play hardball with the Republicans in the final stretch of the stimulus fight, even as the Obama administration hits GOPers blocking the plan somewhat less directly or aggressively.


Bridging House-Senate Differences After Senate Econ Recovery Vote

Politico reports optimism from House-Senate negotiators

Scaling the package back to $790 billion to $800 billion with the goal of still generating 3.5 million jobs is part of the discussions. One option would be to reduce Obama’s signature “Making Work Pay” tax break to $400 for individuals and $800 for couples—down from $500 and $1000 respectively.
“I see some real possibilities,” Senate Appropriations Committee Chairman Daniel Inouye (D., Hawaii) told Politico. “I will sleep well tonight.” … Senate Finance Committee Chairman Max Baucus (D., Mont.) said it is now “very possible” that an agreement could be reached Wednesday.

Early indications are that the White House does not want a prolonged fight with rural senators over Medicaid [Senate version is less generous to states with large urban populations] but would like to resurrect school construction funds, a priority Obama shares with Pelosi.
Obama aggressively defended the $16 billion initiative during his news conference, and his involvement is crucial if Democrats are to convince moderates such as Collins and Specter to relax their opposition.
Among the spending cuts made last week to win Senate Republican votes, this was perhaps the most ideological. For the Obama camp, it brings back New Deal memories of the Public Works Administration creating construction jobs and building schools across the country. But Collins and Specter singled it out for elimination on the grounds that, in today’s world, it represents an expansion of the federal role in state and local affairs — and ought to be debated outside of a stimulus bill.

W. Post floats a school construction compromise: “Senior Democratic aides said one way for negotiators to restore school funding, without the specificity that Collins and Nelson oppose, would be to add money to more loosely defined state accounts.”
CNN reports some leaks:

Details began to emerge on the merging of the bills. Two senior Democratic sources said negotiators had agreed on a top line number of $800 billion but later one of those sources said the number could be even less. That would be less than either the Senate’s $838 billion bill or the House’s $819 billion.
Several sources involved tell CNN that the number is lower to satisfy the three moderate Republican senators who wanted a lower final number.
Also, Sen. Max Baucus, D-MT, who chairs the Finance Committee, said that negotiators have kept a one year patch of the alternative minimum tax in the bill – something House negotiators had argued should be handled outside of the stimulus package.
A Democratic source also said a plan to give tax credits to home buyers which is in the Senate bill will likeky be scaled back to make room for House priorities and a Senate proposal to give tax incentives to people who buy American built cars is also likely to be nixed.

More Politico:

Both Obama and Pelosi are hoping to restore significant stimulus spending eliminated by the Senate, especially $21 billion in school construction and technology grants, $10.3 billion in COBRA insurance and $8.6 billion in new Medicaid coverage for the unemployed … When MSNBC asked Collins how she would react to the restoration of the House spending plan, she replied, “The Democrats will lose my vote.”
Similar remarks by Specter prompted House Majority Leader Steny H. Hoyer (D-Md.), not known for his bellicosity, to fire back at his weekly pen-and-pad session with reporters: “I’m shocked that any senator of any party would say this is the bill we passed, take it or leave it.
But privately, House Democratic staffers see several areas of potential accommodation, including alterations to the mixture of tax cuts and spending that could result in scaling back a $15,000 homebuyer tax credit, a favorite of the Senate GOP, and $11 billion in deduction of taxes on auto purchases, strongly opposed by Senate Finance Chairman Max Baucus (D-Mont.).”

Bloomberg reports “Gang of Moderates” wants a bill smaller than either House or Senate version:

The compromise proposal “has to be under $800 billion,” said Senator Ben Nelson, a Nebraska Democrat. “It’s not just me who believes that; there are some Democrats who believe that and our colleagues from the Republican side as well.”
He said he voted for the $838 billion package only to get it off the Senate floor and into negotiations with the House.
A spokeswoman for Senator Susan Collins, one of three Republicans who supported the stimulus bill in the chamber, said the Maine lawmaker agrees with Nelson. Another Republican backing the Senate bill, Pennsylvania’s Arlen Specter, said on MSNBC that he wants the compromise plan to total less than $800 billion.

The Hill finds fired-up House Dems:

“During a lengthy caucus meeting, where Democratic members railed against the cuts the Senate compromise made to education funding and aid to the states, Pelosi told the members that she agreed and would seek to appoint conferees who push for changes to those reductions.”

Sen. Arlen Specter (R-Penn.), one of three Republicans who broke ranks with his party to deliver Reid the 60 votes needed to cut off debate on the bill, said his continued support was dependent on the conference report reflecting the Senate compromise language.
“My support for the Conference Report on the stimulus package will require that the Senate compromise bill come back virtually intact including, but not limited to, overall spending, the current ratio of tax cuts to spending, and the $110 billion in cuts,” Specter said in a statement released Monday night.
Asked if Specter’s statement meant that the House had no choice but to accept the Senate bill, House Majority Leader Steny Hoyer (D-Md.) shot back: “Nobody’s said that, and I don’t think that’s the case, and I certainly hope that’s not the case.”

WSJ sees the White House weighing in:

The White House is seeking to restore funding cut by the Senate for schools, health insurance and computerizing health records as the economic-stimulus plan headed into a final round of negotiations in Congress, with top lawmakers struggling to bring the price of the two-year package down to $800 billion.

To make room for added spending, the White House, joined by House Democratic leaders, is pressing to scale back certain Senate-passed tax breaks, including measures intended to boost auto and home sales.
White House officials said they can hold on to support for the package, even if spending is increased as a share of the total plan. “We don’t think it’s that precarious,” one administration official said.
But in pushing for more generous spending, the White House risks alienating moderate Republicans and Democrats in the Senate, who supported the package only after more than $110 billion was trimmed from it. Sens. Ben Nelson (D., Neb.) and Susan Collins (R., Maine) are insisting that the tab for the final package come in near $800 billion, and aides in both the House and Senate, as well as lawmakers, suggested that is the target for the negotiations. “That’s in the ballpark,” said Senate Finance Chairman Max Baucus (D., Mont.).

The three Republicans who voted for the plan — Sen. Collins, Sen. Arlen Specter of Pennsylvania and Sen. Olympia Snowe of Maine — are monitoring negotiations. Sen. Snowe said the final package must preserve small-business tax breaks and a measure ensuring that unemployment benefits are tax-free for some workers, among other things. Sen. Collins insists that the cost be kept to $800 billion. Sen. Specter warned that the Senate bill should “come back virtually intact” in the final compromise.
…the Senate’s strong insistence on protecting the moderates was not without costs, raising tensions as the day wore on. “It is so difficult to talk with a body that is controlled by three people,” said House Ways and Means Chairman Charles Rangel (D., N.Y.).

W. Post on governors sounding the alarm:
“If the House version of the federal stimulus package becomes law, Ohio will save 300 youth services jobs, 130 more in addiction counseling and at least 20 positions for aides who provide a respite to relatives of Alzheimer’s patients. It would mean keeping as many as 8,000 children in state-supported child care and saving 500 corrections jobs in a state where prisons are well over capacity.
If the Senate version triumphs, all of those jobs and subsidies — plus many more — will disappear, said Gov. Ted Strickland (D), who has joined with other governors to press members of Congress to back the more generous House approach.

Oxdown Gazette’s TobyWolin mocks whining from Senate obstructionists: “The other item which borders on the delusional is his platform that as long as the GOP held the reins of power in the WH and Congress – the private sector boomed. I’d like him to say that to the hundreds of thousands of people whose jobs have been overseas’d during the last 25 years (before the 3.6 million lost theirs over the past 13 months).”
Wonk Room: “Right Wing Launches Smear Campaign Against Popular Health Provisions”


Robert Borosage on HuffPost calls Treasury plan Obama’s “first serious misstep”:

The plan won’t admit where we are: the major banks in the US are insolvent. They aren’t addled by a temporary fever. They are broke. If they actually marked their toxic paper to the market price – where there is one – their losses would wipe out their capital, even including the billions kicked in by the government in the first round. Clearly, the Obama administration – like the Bush administration before it – hasn’t accepted that reality.
The plan won’t get us where we need to go: we need to restructure – and downsize – our financial sector. Its baroque excesses – billions in bonuses, golden parachutes, million dollar office renovations, $35,000 “commodes on legs,” $50 million private jets, legions of employees – were constructed atop a housing bubble that finally burst. Now the banks and financial houses must be downsized, chastened, and regulated. As President Obama stated, “the party is over.” But the administration’s plan envisions a restoration, not a restructuring. We don’t want to go there even if we could afford it.

Robert Kuttner in USA TODAY, “take over the large banks”:

Treasury Secretary Timothy Geithner’s plan is far too complex, and too much of a gift to Wall Street. Judging by the initial verdict of Tuesday’s financial markets, the plan might well fall of its own weight.
Geithner’s plan basically tries to paper over the fact that several of America’s biggest banks are insolvent in the absence of taxpayer bailouts. It attempts to restart the same system of excessive loan securitization that caused the crash — this time with guarantees or loans by the Treasury or Federal Reserve. Many details have not been released, because the Treasury has not figured out how this can work.
The taxpayers have already effectively bought much of the banking system. It would be far cleaner and more efficient for government to acknowledge that, take over the large banks, clean out their balance sheets, and then sell healthy banks back to private industry.


Drawing praise is an expansion of a program announced last December to have the Federal Reserve backstop loans to consumers. The Fed and Treasury Department will provide up to $100 billion in loans to private investors willing to purchase pools of loans for cars, students, credit cards, small business and nonresidential mortgages…
…On the negative side of the ledger, however, Geithner’s plan offered little detail on how the government will use $50 billion to prevent foreclosures and modify troubled mortgages. Shoddy lending fueled a housing boom and run-up in prices that’s proved unsustainable. Mortgage finance created what now are considered distressed mortgage bonds and triggered the wider financial crisis. Geithner’s plan essentially asked markets and citizens alike to do little more than stay tuned on this front.
The plan also lacked details on the expected purchases of billions of dollars worth of “toxic” assets on bank balance sheets that investors won’t touch. Last October, Congress gave the Bush administration authority to purchase these assets, but the effort shifted instead to injecting capital into troubled banks.
These assets have a new name: legacy securities. Yet the problem of what do about them is unchanged. Banks could crumble if forced to unload them too cheaply, and taxpayers will grumble if government buys them at inflated prices.


Banks taking government aid to stay solvent must accept tougher business restrictions and disclose more about their operations under a new financial rescue plan announced yesterday…Guidelines for transparency and accountability exceed those in the program devised by Geithner’s predecessor, Henry Paulson. Barack Obama’s administration has promised more oversight to make sure bailed-out banks use government money to increase lending. The plan also includes restrictions on acquisitions, dividends, and executive pay. Still, only time will tell how successfully such requirements can be enforced and whether, in practice, the rules turn out to be as tough as they sound…
…The new plan’s accountability provisions don’t explicitly give the Treasury authority to fire bank executives who misuse taxpayer money. Geithner, 47, told Bloomberg Television yesterday that “we have done it already, and we would do it again” when appropriate. Geithner “didn’t put it in writing,” said consumer advocate Ralph Nader. Unless the government has the power to remove executives, Nader said, “there’s no chance here of success.”’s David Sirota: “James Galbraith calls Tim Geithner’s latest giveaway to Wall Street the BARF – the Bad Assets Relief Fund. Details remain sketchy about what this will and will not do … you’ll notice that Geithner effectively admits the plan would likely be rejected by the public if it had any sort of say in the matter. How does he admit this? By specifically structuring the plan to spend over $1 trillion without asking Congress for a dime. Knowing that Congress would probably reflect the public’s simmering anger at this kleptocracy and therefore reject or reform this plan, Geithner has structured it to draw cash from various governmental agencies like the Federal Reserve that are insulated from congressional – and therefore public – control.”
Economic Populist’s Robert Oak: “[I] wonder if a public relations, marketing master wrote up this plan for one can project what one wants to believe within the text.”
Brad DeLong: “I trust Tim; I think Tim is very smart; I think Tim is very public-spirited; I am sure that he is doing the best he can. That said, I cannot have an informed view of his plan until I see some real pieces of paper about it.”
Economist’s View reacts to Geithner interview on Bloomberg: “To me, Geithner’s attempt at reassurance, that they’re not quite sure how the program will work, or if they will get it right, but be assured that they are determined to keep tinkering with the program until it does work, has just the opposite effect. It undermines confidence. Why not wait until they actually have a plan before going public? Why were they in such a rush to reveal that they aren’t sure what to do, or if it will work?”
Matt Yglesias: “There’s clearly a desire here to avoid nationalization. A strong desire. But if the situation in the banking sector is as bad as the skeptics tend to think, this plan is going to end up with the government owning a substantial share in at least some large banks.”
Calculated Risk criticizes Obama answer on ABC’s Nightline eschewing nationalization: “On the issue of ‘cultural differences’ between the U.S. and Sweden, I’ve joked that we should call taking over the banks ‘preprivatization’ to avoid the stigma of ‘nationalization’. But stop and think about what Obama is saying. We know the correct answer, but we are afraid to do it – because of our ‘culture’ – so we are going to follow the Japanese plan.”
Felix Salmon is more impressed with Obama’s answer: “Obama then makes the good point that the banking system in the US is orders of magnitude larger and more complex than the banking system in Sweden was when it was nationalized. He doesn’t even need to mention that the Swedish government is good at getting things done in the way that American governments simply aren’t.”
EPI statement is supportive: “While final details for many parts of the program are still to be determined, the new approach seems to be a significant improvement over the initial bailout efforts. By requiring changes in lending practices, requiring greater balance sheet scrutiny, and by targeting consumer and business loans more directly, the Treasury’s new plan is more likely to impact Main Street and provide overall financial stability.”
Robert Reich sees good and bad in the vagueness:

Geithner was vague about all this, this morning. That’s understandable. The Treasury doesn’t have the entire plan worked out yet, and also needs some wiggle room in case certain aspects prove unworkable. Too much detail can also attract the attention of critics who will inevitably find fault or raise awkward questions. Remember: Nothing has ever been tried on this scale before.
But the vagueness works against him in terms of both confidence-building objectives. The public wants specificity in terms of where the second tranche of TARP’s$350 billion is going, and exactly how it will translate into more loans and more help for distressed homeowners — and will surely demand more specificity if Geithner comes back for additional authorization. More to the point, investors (whoever they are) need lots of specificity before they’re going to put up a single dollar, no matter how much of their downside risk is assumed by the government.

Paul Krugman finds the silver lining in the vagueness: “So what is the plan? I really don’t know, at least based on what we’ve seen today. But maybe, maybe, it’s a Trojan horse that smuggles the right policy into place.”

Conservative Seek To Exploit Bailout Skepticism To Undermine Econ Recovery

Grover Norquist in W. Post: “The only difference between Geithner’s plan and the Pelosi-Reid spend-fest is that the House speaker and Senate majority leader are going to make us rich by spending our money, and Geithner is going to make us rich by lending/giving our money to other people.”

If you don’t really need it…

NYT: “Wall Street banks have taken billions of taxpayer dollars. Now some of them are starting to wonder if they should give the money back … banking executives worry that the government may intrude further into their businesses as long as they are beholden to Washington.”
W. Post on Wall Street’s strategy for today’s congressional hearings: “The chieftains of eight of the nation’s largest banks could receive a tongue-lashing when they testify before a House committee today, but some on Wall Street have moved to preempt the withering criticism by proposing their own solutions to the economic meltdown. ”
CNN: Bank CEOs to defend use of TARP money

Breakfast Sides

Ambinder reports Labor nom could move today: “Organized labor had been told not to expect a vote on the confirmation of Rep. Hilda Solis to be Labor Secretary until after a brief Congressional recess. Now, labor’s being told that Solis’s vote will take place [today] at 2:00 pm. One White House official says that scenario ‘looks good’ but wouldn’t confirm it any further; another said that there is a mark-up scheduled but no vote.”
LA Times on coastal oil drilling: “The Obama administration put the brakes on a push to expand oil and gas drilling off America’s coasts Tuesday and promised to speed development of offshore wind farms. Interior Secretary Ken Salazar announced he will extend public comments for six months on a last-minute proposal by the Bush administration to open swaths of the California, Alaska, Atlantic and Gulf coasts for drilling.”
Rep. John Dingell on HuffPost: “For more than 50 years, I have fought for universal coverage, and there has been no better opportunity than now. I will not let this window slip by, and I urge my friends, my colleagues, and the American people to join with me in making 2009 the year major health care reform legislation is delivered to the Oval Office.”

Progressive Breakfast: Moderates Squabble While Jobs Slip Away

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

Nearly 600,000 Jobs Lost in January

ALERT: AM Labor Dept. reports massive job loss: “Nonfarm payroll employment fell sharply in January (-598,000 [jobs]) and the unemployment rate rose from 7.2 to 7.6 percent…”
Robert Reich: “Senate Republicans and the Stimulus: Playing Politics When the Economy Burns “

Cuts In Education, Energy, Transit, Health, Aid to State Govts Eyed by Moderates

After GOP tax cut proposals increased the size of the Senate economic recovery bill by more than $100B, a bipartisan group of Senate moderates delayed a final vote yesterday as they struggled to agree on how to cut $50B-$100B in investment from the bill.
Guess what? There ain’t that much pork.
NYT: “By early evening, aides said the group had drafted a list of nearly $90 billion in cuts, including $40 billion in aid for states, more than $14 billion for various education programs, $4.1 billion to make federal buildings energy efficient and $1.5 billion for broadband Internet service in rural areas. But they remained short of a deal, and talks were expected to resume Friday morning.”
EARLIER from Politico, on the importance of education and state government help: “…education has clearly emerged as a favorite channel through which Washington will pump massive amounts of aid to states struggling with huge budget deficits aggravated by the economic downturn. The goal is to maintain services and forestall layoffs of public employees, including teachers and fire and law enforcement personnel. ‘When the recession ends, you are still going to need teachers, firemen, policemen, and the question is do we step in now or pay more to rebuild later,’ a House Democratic leadership aide told Politico.”
ACTION ALERT from The Seminal’s Jason Rosenbaum: “Take a moment to call your Senators. Ask them to hold the line on these provisions, which are needed to keep vital state programs like Head Start, not to mention COBRA, Medicaid, and Medicare operational. These programs directly benefit those with low incomes or those families who’ve recently lost their jobs. It’s economic recovery that goes straight to the people, and it’s money that should be approved.”
Conservative Dem Sen. Ben Nelson got a bug about education funding. From TIME: “The biggest sticking point for the moderate gang has been about whether or not the federal government should be granting states aid for education. ‘As a former governor I didn’t like it when [the federal government meddled with education] because they never funded it completely,’ Nelson said. “I’m prepared to make some adjustment in my attitude toward that if we can be sure that whatever we do on the federal level is temporary.”
Of course, current governors are begging for federal help.
Stateline on states in crisis: “As state public health programs reach a crisis point — with surging demand and shrinking state budgets — officials say that only a federal bailout will prevent more and deeper cuts to the state-provided medical care relied on by the lowest-income Americans. ‘States are under tremendous stress, and they really need to get the stimulus package passed quickly,’ said Ann Kohler, director of the National Association of State Medicaid Directors…”
EPI: Don’t strip health provisions from stimulus
NYT’s Paul Krugman: “Even if a major stimulus bill does pass the Senate, there’s a
real risk that important parts of the original plan, especially aid to state and local governments, will have been emasculated. Somehow, Washington has lost any sense of what’s at stake — of the reality that we may well be falling into an economic abyss, and that if we do, it will be very hard to get out again.”
TPMDC goes deeper into possible cuts in health, state law enforcement, transit and education.
Grist’s Kate Sheppard reviews possible cuts in clean energy and transit’s Bernie Horn: “Right now, conservative U.S. Senators — both Republicans and Democrats — are thrashing around trying to cut pieces out of President Obama’s economic recovery plan. They say it costs too much. Ironically, these are the same Senators who increased the legislation by more than $100 billion just a couple of days ago. They just don’t get it. ”
Oxdown Gazette’s Scarecrow: “Do Sens. Collins, Nelson et al Want to Fire Teachers?
Sen. Maj. Whip Dick Durbin warned of the damage cuts could do. From AFP:

“Those who are talking about cutting massive amounts of money out of this bill are also cutting massive amounts of jobs,” he told reporters, warning that spending too little now could mean spending much more later.
“If we’re going to toss a teacup of water on this fire today, we’ll be back with firetrucks in months to come,” said Durbin, who vowed to support “compromise that’s reasonable and that brings in votes too pass the package.”

Politico on the mythical middle: “Central to the drama is a bipartisan bloc of 12 to 18 senators including [GOP Sen. Susan] Collins who hold the balance of power and are struggling among themselves over how best to scale back the $924 billion package. Cuts between $90 billion and $108 billion have been discussed, but the negotiations have become more difficult as individuals have sought to not just scale back spending but also redirect money with the package. Collins herself favors some formulation that adds more money for infrastructure spending, such as clean water and transportation projects. But the risk is that the offsetting cuts become too much to sustain, and the leadership is preparing to step in with its own smaller package of targeted cuts in the range of $50 billion.”
Maybe cuts somewhat offset with more infrastructure investment? Time: “From that list they selected about $100 billion in programs, mostly in education, state aid and science that, while perhaps worthy, they don’t believe belong in the stimulus bill. At the same time, the coalition has also agreed to add another $30 billion in infrastructure spending that the group does see as stimulative.”
CQ reports either a final vote will come today, or Sen. Maj. Leader Reid will file a motion setting up a cloture vote to end debate on Sunday.

President Obama Rips “Talking Points,” “Cable Chatter” and “Phony Arguments”

President Obama gives a tour de force at the House Democratic retreat. Full C-Span video here. MSNBC highlights below.
“Don’t come to table with the same tired arguments and worn ideas that helped create this crisis” {font-size:11px; font-family:Arial, Helvetica, sans-serif; color: #999; margin-top: 5px; background: transparent; text-align: center; width: 425px;} .msnbcLinks a {text-decoration:none !important; border-bottom: 1px dotted #999 !important; font-weight:normal !important; height: 13px;} .msnbcLinks a:link, .msnbcLinks a:visited {color: #5799db !important;} .msnbcLinks a:hover, .msnbcLinks a:active {color:#CC0000 !important;}

“Then you get the argument, this isn’t a stimulus bill, this is a spending bill. What do you think a stimulus is? That’s the whole point.”. {font-size:11px; font-family:Arial, Helvetica, sans-serif; color: #999; margin-top: 5px; background: transparent; text-align: center; width: 425px;} .msnbcLinks a {text-decoration:none !important; border-bottom: 1px dotted #999 !important; font-weight:normal !important; height: 13px;} .msnbcLinks a:link, .msnbcLinks a:visited {color: #5799db !important;} .msnbcLinks a:hover, .msnbcLinks a:active {color:#CC0000 !important;}

AmericaBlog’s Joe Sudbay: “The Republicans thought this was all fun and games. Well, now they may be back in the ring with the Barack Obama who whipped their butts in November. I hope so.”
OpenLeft’s David Sirota: “He’s on his game – and he’s finally thrown the Church of Broderism overboard. It’s pretty badass.”
Digby: “I noticed in passing that David Gergen is nearly in tears that Obama has betrayed the promise of bipartisanship tonight. He’s heartbroken that Obama decided that it was more important to save the economy than kiss GOP hems and bow and scrape before the villagers.”
MyDD’s Todd Beeton: “You’ll recall both during the primary and the general, Obama always performed better when he was down. He thrives in times of adversity. Well, the Republicans certainly have provided a big dose of that. Welcome back, Mr. President.”
TPM: “Exactly the case he needs to be making on TV and in some events around the country.”
On NBC’s Today this morning, Newt Gingrich has the audacity to accuse the President of not being bipartisan enough.
Weekly Standard’s Matthew Continetti paints Obama as “angry”: “Obama lambasted Republican critics of the stimulus and heaped scorn on the Bush administration for piling up the national debt. He said the stimulus bill could end the ‘tyranny of oil,’ whatever that means … A tell-tale sign in politics is when people get angry. It means they are losing the argument. Obama is angry. And he has only himself to blame.”
National Review’s Byron York: “His answer: if it’s spending, it’s stimulus. And if it’s full of earmarks, well, stuff happens.”

House Conservative Explains Obstructionist Strategy: “Insurgency, we understand perhaps a little bit more because of the Taliban.”

The Reaction’s Michael Stickings: “At this challenging time, with the economy struggling and without an end in sight, with people losing their jobs and their homes and their health care, the Republican Party intends not to work with Obama and the Democrats on a comprehensive plan to get the country moving again, or at least not constructively, but to launch an insurgency, an aggressive effort to attack and undermine the economic stimulus plan. In other words, Republicans are Washington’s terrorists.”
FireDogLake’s Thers: “Now, whatever else this is, it’s incoherent, freakish, and strange. It’s the sort of gibberish produced by someone faced with the choice of either cheering on appalling economic catastrophe, or else bringing on his own utter ideological obsolescence.”

Bad Bank Trial Balloon Goes Bust?

Bloomberg reports:

U.S. Treasury Secretary Timothy Geithner’s strategy to aid the nation’s banks will likely emphasize guarantees of toxic assets over proposals to create a so-called aggregator bank that would remove them from balance sheets, according to people familiar with the plan.
The government guarantees, which might be modeled on those already given to Citigroup Inc. and Bank of America Corp., may be coupled with the purchase of preferred shares in the banks that would be later convertible into common stock, some of the people said. The aggregator bank or ‘bad bank,’ has lost favor, in part because the potential costs involved, they added…
…The administration, smarting over the fight in Congress over its $800 billion plus economic stimulus plan, is wary about asking lawmakers for more money now for the banks, according to some of the people.
That’s one reason why the administration looks to be backing away from setting up a giant aggregator bank to buy up the assets and at most may settle on a smaller version of that, they added…
…Banks are also pressing for the plan to include a temporary easing of mark-to-market rules that require them to reduce the value of assets they hold. The firms maintain that at least some of the assets are not that impaired, arguing that investors are being too pessimistic about their ultimate value.
Senate Banking Committee Chairman Christopher Dodd said on Feb. 3 that such a change might be needed, although he made clear yesterday that he isn’t convinced. “I haven’t embraced it yet,â€? the Connecticut lawmaker told reporters, adding that he intended to discuss the idea with Geithner.

Politico’s Glenn Thrush: “Treasury Secretary Tim Geithner will give House Democrats a sneak preview of his bank bailout overhaul on Saturday — two days before he’s due to release details to the public.”

Health Care Reform This Year

The Hill: “In a letter sent to President Obama on Thursday, Sens. Edward Kennedy (D-Mass.) and Max Baucus (D-Mont.) assert the need to act quickly to overhaul the U.S. healthcare system. ‘We are writing to affirm our continuing commitment to enacting comprehensive healthcare reform this year,’ wrote Kennedy and Baucus, who chair two committees that will take the lead in drafting legislation to carry out Obama’s health agenda.”
Institute for America’s Future releases new report: “A Public Health Insurance Plan: Reducing Costs and Improving Quality:” “This report explains why a public health insurance plan that competes on a level playing field with private insurance plans in an exchange offers the best promise for reining in health care costs, encouraging greater efficiency and quality, and providing people with financial security. Moreover, authoritative studies show that the savings that can be achieved by insuring millions of people in a public health insurance plan may be enough to pay for covering the 46 million Americans currently without insurance.”
Managed Care Matters’ Joe Paduda is heartened by the bipartisan SCHIP vote: “This marks the first step towards universal coverage … Among the GOP Senators voting ‘yea’ were Collins and Snowe of Maine, Alexander and Corker of Tennessee, and Hutchison of Texas (!). While the Snowe and Collins votes are not unexpected, the support of the two Tennesseans and Hutchison in Texas are somewhat surprising. I wouldn’t expect the latter Senators to be very supportive of future health reform legislation. That said, the fact that this initial bill passed with some bipartisan support is a positive signal for reform advocates.”
ThinkProgress: “Boehner creates GOP health care task force stacked with industry-tied lawmakers.”

Solis Update

Ambinder: “For organized labor, enough’s enough. The nomination of Hilda Solis is languishing in the Senate, with Republican protesting Solis’s past association with labor groups and Democrats wondering about the tax problems her husband recently solved. Tomorrow, the AFL-CIO fights back. ‘Enough is enough,’ a spokesman said tonight Watch Friday for labor, women’s groups and Hispanic groups to open fire against Republicans.”

Amendment Roundup

From CQ:

On a 40-57 vote, senators upheld a budget point of order against a $421 billion substitute amendment from McCain that included $275 billion in individual and corporate tax reductions, along with $50 billion in spending on entitlement programs, $32 billion in spending and tax breaks aimed at stimulating the housing market, and $64 billion in infrastructure investments.
Senators voted, 32-65, to reject an amendment from Russ Feingold, D-Wis., that would create a new point of order against unauthorized earmarks in spending bills. The stimulus bill does not contain earmarks in the traditional sense, but opponents of these parochial projects believe it is time to push the issue as concerns grow about how to handle the deficit and what spending is worthwhile.
The Senate adopted, by voice vote, an amendment from Banking Chairman Christopher J. Dodd, D-Conn., that would prohibit bonuses and other incentives for at least the 25 most highly paid executives at firms that are receiving bailout funds from the Treasury Department. It would require Treasury to conduct a retroactive review of bonuses given out by these firms.
Senators adopted by voice vote an amendment from McCaskill that would impose a $400,000 salary cap on officers and directors at firms receiving bailout funding.
It also rejected, 35-62, a substitute amendment from John Ensign, R-Nev., that would have the government guarantee a 30-year interest rate of 4 percent to 4.5 percent for refinanced mortgages of $750,000 or less.

Progressive Breakfast: The Majority Fights Back

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.
ALERT 1: Final vote on American Recovery and Reinvestment Act could be today. Call your Senators at 1-866-544-7573 and demand immediate passage of a big and bold economic recovery bill.
ALERT 2: New jobless claims jump more than expected to 626K

The Majority Fights Back

President Barack Obama follows yesterday’s forceful remarks reiterating the mandate for public investment and rejection of Bush-style tax cuts with W. Post oped:

This plan is more than a prescription for short-term spending — it’s a strategy for America’s long-term growth and opportunity in areas such as renewable energy, health care and education. And it’s a strategy that will be implemented with unprecedented transparency and accountability, so Americans know where their tax dollars are going and how they are being spent.
In recent days, there have been misguided criticisms of this plan that echo the failed theories that helped lead us into this crisis — the notion that tax cuts alone will solve all our problems; that we can meet our enormous tests with half-steps and piecemeal measures; that we can ignore fundamental challenges such as energy independence and the high cost of health care and still expect our economy and our country to thrive.
I reject these theories, and so did the American people when they went to the polls in November and voted resoundingly for change. They know that we have tried it those ways for too long. And because we have, our health-care costs still rise faster than inflation. Our dependence on foreign oil still threatens our economy and our security. Our children still study in schools that put them at a disadvantage. We’ve seen the tragic consequences when our bridges crumble and our levees fail.
Every day, our economy gets sicker — and the time for a remedy that puts Americans back to work, jump-starts our economy and invests in lasting growth is now.

Obama econ aide Christina Romer pens Atlanta Journal-Constitution oped (via Daily Kos):

Both our internal estimates and those of highly respected private forecasters suggest that the plan will be immensely helpful. As the President has often said, conditions will surely get worse before they get better. But, they will get better. The plan will save or create 3 to 4 million jobs by the end of 2010.
The program will not just deal with the immediate crisis, but will help the economy grow faster long after the recession and recovery are over. Repairing our infrastructure will help American businesses be more competitive and will make American commuters safer. The energy investments will put us on a path to a cleaner environment and energy independence, while the health information technology investments will lower medical costs and save lives by preventing mistakes. The spending on schools and education builds human infrastructure, which makes our workers more productive.

White House also releases state-by-state breakdown of the bill’s economic benefits, including estimated number of jobs created, and bipartisan letter of support from 19 governors.
W Post’s EJ Dionne reports GOP govs and mayors on board: “If Washington Republicans have decided to build a wall of opposition to the stimulus, Republican governors and mayors are eager for the money Obama wants to give them. Thus will Obama and his allies be touting strong support for the stimulus from the Republican governors of California, Connecticut, Florida and Vermont. Mayors will be called upon to move House Republicans still open to persuasion.”
FireDogLake’s Phoenix Woman: “America’s Mayors to GOP: PLEASE Vote for the Stimulus!”
W. Post’s Harold Meyerson compares conservatives to failed FDR opponent Alf Landon:

As for the Republicans, they remain locked in Landonism. While retail chains topple like so many dominos as consumers cut back, the Republicans focus on cutting corporate taxes, as though the problem confronting American businesses was the tax on their profits rather than the fact that, in the absence of sales, they have no profits.
In particular, both the Republicans and the Blue Dog Democrats exhibit a Landonesque failure to appreciate the crisis of under-investment into which American finance, now as in the ’30s, has plunged the nation. The essence of the crisis, and what distinguishes both the Depression and the current meltdown from every recession between the ’30s and today, is that, left to their own devices, private lending and investment will not and cannot bounce back. Only the government can provide the capital to restart capitalism, which remains, absent diligent regulation, a periodically self-annihilating system.

NYT’s Gail Collins pushes back on the phony pork attacks:

Whenever the Republicans bring up anything in the stimulus bill that sounds a little weird, the Democrats have been pathetically eager to throw in the towel. Witness the Senate’s defeat of $246 million in tax breaks for Hollywood studios, which might not have sounded so silly if you were a college student whose father is a cameraman.
At the insistence of the White House, the Democrats eliminated $200 million to expand federal assistance to states that want to provide family-planning services to poor women. The Congressional Budget Office has estimated the money would eventually save about $400 million by cutting unwanted pregnancies. But it became a big rallying point for social conservatives. (“Won’t fewer people mean fewer taxpayers?â€? demanded columnist Cal Thomas.) So goodbye family planning.
The $200 million to fix up the National Mall was tossed out in the House. The much-decried money for disaster insurance for the honeybee industry, which is already the subject of snippy T-shirts, never existed, according to the Senate Appropriations Committee. Or if it did, it’s been whisked away and buried under the floorboards.

CQ Politics: Attempts by Senate conservatives to dramatically alter the plan’s thrust failed:

An amendment by Jim DeMint , R-S.C., that would prevent an increase in taxes scheduled in 2011, reduce the top business tax rate from 35 percent to 25 percent, and make other tax cuts that he said would create 18 million jobs over 10 years fell when a motion to waive the Budget Act was defeated, 36-61.
Similarly, an amendment by John Thune , R-S.D., to ensure that the bill is not used to expand the scope of the federal government by adding new spending programs was rejected, 35-62.

Grassroots Getting Fired Up

FireDogLake’s Ian Welsh: Hit The Phones To Stop a Depression. “It’s time to hit the phones for the stimulus bill. Calls are running at 100:1 against. Yes, it’s not that good a stimulus bill, I’ve said so myself, but it’s not a case of scrapping it and starting over, what looks likely to happen is that it gets badly watered down with bribes to Republicans and ‘moderate’ Democrats like Ben Nelson to get it through.”
Reality-Based Community’s Andrew Sabl:

I agree that Obama has lost some control of his message (as Josh Marshall and Nate Silver argue), and has, in Senate negotiations, given up some of his priorities (and mine) too easily–though I wouldn’t go as far as Jonathan; things are far from catastrophic.
The question is what to do about it. Avid armchair politician though I am, I think it’s time for lots of us to turn foot soldier instead. The way to amplify Obama’s message is to repeat it. The way to improve a big recovery package’s chances in the senate is to get many, many voters to give their senators the identical message that they favor it … Phone calls are effective and immediate.

HuffPost’s Art Levine on progressive grassroots efforts: “So far, the full power of Obama’s mighty Web-based grass-roots organization hasn’t yet been unleashed to support the President’s stimulus package in the battle now underway in Congress. So outside progressive groups have to take up the slack, but if grass-roots conservatives are out-lobbying progressives 100-to-1, then still more needs to be done — and you can join in to help.”

Will Senate Reduce Size of Bill?

Bloomberg reports GOP moderates negotiating with President over amount of public investment:

Obama met yesterday with two Republicans, Maine Senators Olympia Snowe and Susan Collins, who may prove critical to passing the legislation. Both are pushing to strip billions from the plan, spending they say would do little to create jobs.
Snowe said she gave Obama a list of potential cuts, which she said she would like to see total “upwards to $100 billion.â€? She said Obama was “very amenableâ€? to the suggestions.
“He’s prepared to be receptive to the ideas and to re- evaluating some of the spending measures,â€? Snowe said. “We really do need to remove those items that have nothing to do with the purpose of jump-starting the economy.â€?
Collins, who said she preferred a stimulus package totaling about $650 billion, said Obama made a “very strong pitch to have a bill that is considerably bigger than what I might like and argued that the economy is sufficiently troubled that legislation has to be large enough to have the kind of impact that we all want.â€? She said she is “committed to trying to get to a yes vote.â€?

CQ Politics:

Both Collins and Nelson said Obama was receptive to some of their critiques. But Collins said the president told her he was concerned that if too much is cut, the package will be too small to have the needed impact on the economy. Collins said she would like to see the package cost about $650 billion, a number Obama told her was too low.
“His concern is that the package be robust enough and large enough to give a real jolt to the economy,â€? Collins said.
Both senators said they are discussing what funding to cut with about 10 Democrats and 10 Republicans. The proposal could be ready by Thursday.
Nelson and Collins declined to say what they want removed from the bill. But Nelson said his bottom line for cuts would be a lot more than $30 billion. Earlier Wednesday his office put that figure at more than $50 billion.

Buy American compromise in Senate

Bloomberg reports: “Senators voted yesterday to stipulate that the bill’s ‘Buy American’ restrictions must be carried out in a way consistent with the nation’s trade agreements. The bill had required iron and steel used in projects funded by it be made in America. These provisions drew protests from foreign leaders and Obama, who said the restrictions could spark a trade war. In what Democrats said was compromise, the Senate approved by voice vote an amendment stipulating the provisions shall be ‘applied in a manner consistent with United States obligations under international agreements.’ A proposal by Arizona Republican Senator John McCain to delete the ‘Buy American’ provisions was defeated, 65-31.”
CQ Politics reports McCain did not care for the compromise: “…McCain said the clarification would do nothing to address the concerns of free-traders. ‘It is impossible to say that the section would be applied in a manner consistent with the United States’ obligations under international agreements and then say that anything that’s manufactured in the United States, whether iron, steel or manufactured goods, will have to be subject to “‘Buy America,”‘ McCain said.”
Dean Baker on TPMCafe notes the “free-traders” are happy to protect the banks and ignore the steelworkers:

The free trade crew tells us that this Buy America provision will start a trade war. Why would our trading partners start a trade war over a bill that increases demand for their exports?
That’s right, the stimulus bill will increase demand for imports, including for imported steel. The bill will lead to more growth, which will increase demand for all products, including imported steel. That will be the case even if we have barriers that limit the use of imported steel for a small part of the stimulus. So, will our trading partners start a trade war because we are buying more of their products?
It is also worth comparing the protection that the “free traders” see compared to the protection that they don’t see. The government has already provided $350 billion in subsidized loans to our banks through the Troubled Asset Relief Program (TARP). The Fed has provided hundreds of billions more.
For some reason, these massive government subsidies, which hugely advantage U.S. banks relative to their foreign counterparts, have gotten no attention whatsoever from the so-called “free traders.” Every bad thing that they say about protection for steel can be said for protection for banks, but for some reason we haven’t heard any complaints about the bank bailouts.

Booman Tribune analyzes the Senate Republican vote patterns: “Collins and Snowe have voted with the Democrats over 80% of the time in the 111th Congress and they both voted against almost all of tonight’s amendments. Other than them, Lindsey Graham was the only Republican that voted against stripping the Buy American provisions who isn’t going to be facing the voters next year. I don’t know what motivated Graham (he normally does whatever John McCain tells him to do) but I can tell what motivated the others. Republicans want to do the bidding of their corporate masters but not if it means that they are going to be thrown out of office. All the safe Republicans and all the Republicans that aren’t going to be facing the voters for four-to-six years voted to strip the Buy American provisions.”
Meanwhile, Economic Populist reports on new “Hire American” Senate proposal: “In response to the Associated Press investigation that TARP bail out recipients were firing Americans while hiring foreign guest workers, Senators Bernie Sanders and Chuck Grassley are offering an amendment to demand these bank recipients of U.S. taxpayer dollars hire U.S. workers and stop this horrific practice of labor arbitrage.”

Senate Approves $15K New Home Tax Credit


The Senate on Wednesday voted to expand the economic stimulus package with a tax credit for homebuyers of up to $15,000, a provision championed by Republicans as addressing a root cause of the recession.

The tax break for homebuyers, which the Senate approved by voice vote without opposition, was the second amendment in two days intended to encourage consumers to make major purchases. On Tuesday, the Senate approved a tax incentive for car buyers, sponsored by Senator Barbara A. Mikulski, Democrat of Maryland, that would allow the deduction of sales tax and loan interest on purchases made this year.
But while both of those incentives were applauded by lawmakers who said that the bill should quickly induce consumer spending, some economists said they were short-sighted and lacked the forward-thinking approach Mr. Obama has demanded.

Beat The Press’ Dean Baker lambastes the idea as a “House Flipping Subsidy.”

More Amendments Today


“Lawmakers are pushing amendments tied to the meltdown on Wall Street. Senator Ron Wyden, an Oregon Democrat, said he and Snowe will offer one aimed at financial institutions that take money from the government’s Troubled Asset Relief Program. Under the amendment, those companies would have to repay the cash portion of bonuses topping $100,000 that were paid to employees for work last year.
“It’s not enough to say these bonuses are wrong,â€? Wyden said. “They must be paid back.â€?
Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat, said he will offer an amendment requiring that at least $50 billion of the TARP money is used to stem housing foreclosures.
“This amendment would secure I think beyond any doubt that those resources that I’ve identified here would be allocated for foreclosure mitigation,â€? he said.

CQ Politics: “On Thursday, the Senate is slated to debate an amendment from John Ensign , R-Nev., that would have the government guarantee a 30-year interest rate of 4 percent to 4.5 percent for refinanced mortgages of $750,000 or less.”
Dean Baker warns pushing rates lower will lead to people losing money when home prices drop. Economist’s View rounds up conservative criticism.

Differing Views on Executive Compensation Rules

Bloomberg plays up concerns of loopholes: “Executives at Goldman Sachs Group Inc., JPMorgan Chase & Co. and hundreds of financial institutions receiving federal aid aren’t likely to be affected by pay restrictions announced yesterday by President Barack Obama. The rules, created in response to growing public anger about the record bonuses the financial industry doled out last year, will apply only to top executives at companies that need “exceptionalâ€? assistance in the future. The limits aren’t retroactive, meaning firms that have already taken government money won’t be subject to the restrictions unless they have to come back for more.”
LA Times notes this could just be a beginning if Wall Street continues its greedy ways:

“Some of it may be a bit of theater right now,” said Claudia Allen, chairwoman of the corporate-governance practice at Chicago-based law firm Neal, Gerber & Eisenberg, noting that the number of executives guaranteed to have their pay restricted by the rules is “a small universe.”
But the message Obama is sending may affect the behavior of many others, she said.
“He’s saying to corporate America, ‘You’ve got to get it right,’ ” she said. “We’re going to watch taxpayer funds very closely.”

Working Life’s Jonathan Tasini: “The CEO Pay Caps Are A Mirage … what the Treasury is saying is this: if you publicly disclose–meaning, put it in writing in some vague way–and you put it to a shareholder vote you know you will win, then, you can pay the executive whatever they want. If you want real changes in CEO pay, you have to start with the way power is distributed in a corporation–not by promulgating toothless rules.”

Modernizing Financial Regulation

NYT reports on Obama economic adviser Paul Volcker’s congressional testimony:

Paul A. Volcker, the former Federal Reserve chairman who is leading President Obama’s Economic Recovery Advisory Board, called Wednesday for fundamental changes in the regulation of financial instruments and institutions, especially of those firms whose collapse can put the financial system at risk.
In testimony before the Senate Banking committee, Mr. Volcker called for the end of the mortgage lending giants Fannie Mae and Freddie Mac as hybrid public-private enterprises, saying instead that Washington should assist borrowers through “clearly designated government agencies.â€?
He also called for the registration of hedge and equity funds of any substantial size, as well as periodic reporting and disclosure from such firms.
For banks and other firms that are large enough to shake the entire financial system if they fail, he called for “particularly close regulation and supervision, meeting high and common international standards.â€?
While he did not offer details of how these more robust regulations would be enforced, he said that central banks, including the Federal Reserve, should accept “a continuing role in promoting and maintaining financial stability, not just in times of crisis, but in anticipating and dealing with points of vulnerability and risk.â€?

Bloomberg (via The Big Picture) speculates on friction between Volcker and Obama’s National Economic Council Director Lawrence Summers.

SCHIP Expanded, Conservatives Still Hate Helping Kids

LA Times:

…with Democrats now firmly in control of the White House and Congress, the party’s leaders easily pushed through a $33-billion bill that is expected to provide government-subsidized insurance to 4 million mostly low-income children.
That would reduce the number of uninsured children in America by about half over the next 4 1/2 years and boost the number covered by the program to 11 million…
…Bush vigorously opposed the move, twice vetoing SCHIP legislation despite substantial GOP support for the bills.
On Wednesday, Republican lawmakers echoed many of the former president’s critiques.
“The Democrats continue to push their government-run healthcare agenda — universal coverage, as they call it,” said Rep. Pete Sessions (R-Texas), who helped lead opposition to the bill.
Republicans also chafed at provisions that would allow states to provide insurance to the children of legal immigrants who have been in the country for less than five years…

Breakfast Sides

Jonathan Cohn and Ezra Klein warn against TN Governor and former HMO chief Phil Bredesen for Health and Human Services Secretary
W. Post: After Delay, Panel to Vote on Solis Nomination
W Post: Salazar Voids Drilling Leases On Public Lands in Utah
EPI: 15 Questions and Answers on the Employee Free Choice Act
Bloomberg: U.S. Automakers ‘Choking’ Without Credit Await Fed Loan Program
Conservative response to Obama’s dire warning of higher unemployment? Suck it up! Riehl World View: “It reached double digits in 82 and it didn’t take a trillion dollars of our money and mortgaging our children’s future to dig us out. It took calm and perseverance to endure some hardship, both of which you apparently lack.”

Progressive Breakfast: Attacks Shift From Phony Pork to the Poor

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

Focus Quickly Returns To Economic Recovery

W. Post claims resistance in the Senate to a larger bill (after, per NYT, Senate votes for a larger bill):

Senate Democratic leaders conceded yesterday that they do not have the votes to pass the stimulus bill as currently written and said that to gain bipartisan support, they will seek to cut provisions that would not provide an immediate boost to the economy .. Moderate Republicans are trying to trim the bill by as much as $200 billion, although Democrats working with those GOP senators have not agreed to a specific figure …
For now, the Senate bill remains a work in progress. “We’re trying to find a way to reach 60” votes, Majority Whip Richard J. Durbin (D-Ill.), the Senate’s chief vote counter, told reporters. “A number of Democrats have said they want to see changes to the bill before they can vote for it.”
Durbin predicted that “100 decisions” will be “made between now and when we deliver the bill to the president’s desk.”
To remove obstacles from the measure’s path, Reid said numerous items could fall by the wayside. “The president, the Democratic leaders, the Republican leaders certainly have every intention of moving forward to getting everything out of the bill that causes heartburn to a significant number of senators,” he told reporters yesterday.
What Senate leaders cannot predict is which provisions will stay in and which will fall out. It also remains unclear whether Democrats are willing to tamper with measures that are considered high priorities for Obama, but that tackle longer-term challenges such as health-care reform and alternative energy development, rather than providing the quick jolt of expanded unemployment and food-stamp benefits and individual tax relief.
The most ambitious effort to cut the bill is being led by Sens. Ben Nelson (D-Neb.) and Susan Collins (R-Maine), moderates in their parties who share a dislike of the current version. Collins is scheduled to visit Obama at the White House this afternoon. “I’m going to go to him with a list” of suggested deletions, she said.
Nelson said he and Collins have agreed to “tens of billions” in cuts, although he said he is skeptical that the effort will reach Collins’s target of $200 billion in reductions. The pair has counted up to 20 allies in their effort, with more Democrats than Republicans at this point.
Among the items that the Collins-Nelson initiative is targeting: $1.1 billion for comparative medical research, $350 million for Agriculture Department computers, $75 million to discourage smoking, $20 million in Interior Department funding, $400 million for HIV screening and $650 million for wildlife management.
The medical research measure, aimed at developing uniform treatment protocols, is an Obama priority and part of the foundation he is trying to build for health-care reform.

USA Today says Obama will meet with Nelson, Snowe and Collins, but defends size of bill: ” … On Wednesday, the president will meet at the White House with Maine Republican Sens. Susan Collins and Olympia Snowe as well as moderate Nebraska Democrat Ben Nelson — three senators who represent the middle ground [SIC] in the 100-member body. Collins and Nelson want to eliminate much of the spending on future investments that, they say, won’t create jobs immediately … Obama said there are limits to his flexibility. ‘The overwhelming bulk of the package is sound,’ Obama said on ABC. ‘Most of the programs that have been criticized as part of this package amount to less than 1% of the overall package.'”

Conservatives Move From Attacking “Pork” to Attacking The Poor

In WSJ, GOP Sen. Tom Coburn deems health care, education and aid to squeezed states as not economically helpful: “Less than 10% of the bill could be considered true stimulus, if one assumes tax credits and infrastructure spending will jolt the economy. The other 90% of the bill represents one of the most egregious acts of generational theft in our nation’s history, with taxpayer money going to special-interest earmarks, an ill-conceived bailout to states, and permanent spending increases that expand government’s reach in areas like health care and education.”
Media Matters: “[MSNBC’s Mika] Brzezinski persists with food stamp claim, despite economists’ flat rejection”
Media Matters: “Ignoring stimulus effects, CNN’s Romans uncritically reported ‘safety net spending doesn’t necessarily create new jobs'”
ACORN’s Bertha Lewis on HuffPost: “Think the economic recovery package was all about contraceptives and a $4 billion payout to ACORN? (We wish.) Think again. What conservative bullies like Rush Limbaugh and Sean Hannity are not telling us in their drearily familiar, windbag attacks on the desperately needed economic recovery package is that it contains a wealth of provisions that put money directly into the economy through programs aimed a low- and moderate-income families. These types of programs are not only essential to the survival of working families facing hardship at every turn, but they put money into the hands of folks who will immediately spend it in the local economy on things like food, transit, clothes, and school supplies. In fact, Moody’s chief economist Mark Zandi says that investing in the food stamp program (SNAP) will provide $1.73 in GDP growth for every $1 invested. ”
Oxdown Gazette’s Scarecrow: “Republicans’ Stimulus “Wasteful Spendingâ€? List: Is that All They’ve Got? … if this list, which only adds up to about 2 percent of the total, is all the Republican are complaining about, then the rest of the stimulus package must be pretty good.”
ThinkProgress: “McCain Opposes Recovery Package Because It Has ‘Corporate Giveaways’ That He Once Campaigned For”

Obama Sets Record Straight

President Obama on ABC World News Tonight:

t I want to be absolutely clear here that the overwhelming bulk of the package is sound, is designed to put people back to work, help states that are in desperate straits, help families who are losing jobs and health care, and it’s designed to make sure that we’ve got green energy jobs for the future. In fact, most of the programs that have been criticized as part of this package amount to less than one percent of the overall package. And it makes for good copy, but here’s the thing — we can’t afford to play the usual politics at a time when the economy continues to worsen.

President Obama on NBC Nightly News:

Nobody disputes that we should extend unemployment insurance. Nobody disputes that it is important for us to make sure the people who lose their jobs through no fault of their own still have some meaningful access to health care. Nobody disputes that if we don’t use some of this money, this enormous expenditure, to deal with our energy dependence or the rising cost of health care, that we are going to continue to be in a very perilous situation 10 years from now or 20 years from now. So are there ways that we can improve the bill? Absolutely. And I want to continue to work with Democrats and Republicans to find some common ground.
But what I can’t accept is the politics as usual, where we think about scoring points instead of acting. We’ve lost a million jobs in the last two months. We can’t afford another four million jobs lost this year. And every economist that I talk to projects that if we don’t act quickly, we could end up seeing a much more severe situation than we’re seeing right now.

Obama on CBS Evening News

KATIE COURIC: Sen. Mitch McConnell said over the weekend that surely you’re privately embarrassed by some of the product that came out of the house version and let me just mention some of the spending in this package: $6.2 billion for home weatherization, $100 million for children to learn green construction, $50 million for port modernization water and wastewater infrastructure needs in Guam, $50 million for the NEA, the National Endowment for the Arts. Even if some of these are a legitimate use of taxpayer dollars, Mr. President, why are they included in this bill designed to jumpstart the economy and create jobs right now?
PRESIDENT OBAMA: Well, let’s think about it. We’re going to weatherize homes, that immediately puts people back to work and we’re going to train people who are out of work, including young people, to do the weatherization. As a consequence of weatherization, our energy bills go down and we reduce our dependence on foreign oil. What would be a more effective stimulus package than that? I mean, you’re getting a threefer. Not only are you immediately putting people back to work but you’re also saving families on your energy bills and you’re laying the groundwork for long term energy independence. That’s exactly the kind of program that we should be funding.

Obama on “Buy American” Provisions

On Fox News, Obama takes negative tone towards “Buy American” provisions, but stops short of opposition.

CHRIS WALLACE: Strip out the “buy American” provision for steel and iron in the bill, which a number of our allies are saying is too protectionist?
PRESIDENT OBAMA: I agree that we can’t send a protectionist message. I want to see what kind of language we can — we can work on this issue. I think it would be a mistake, though, at a time when worldwide trade is declining, for us to start sending a message that somehow we’re just looking after ourselves and not concerned with world trade.

MyDD’s Charles Lemos: “These ‘Buy America’ provisions are not tariffs and do not alter any of the various free trade agreements currently in force. The provisions articulate a sound public policy goal, the creation of high-paying jobs in America’s foundries and steel mills. This bill is, after all, an American fiscal stimulus bill not one to spur the economies of China, South Korea, Brazil or Luxembourg … I am hoping that when the decision is made, it’s the Vice President who is the last man in the room.”
D-Day: “Let’s go over this again: provisions like this are CURRENT LAW for federal procurement. When the federal government purchases, they purchase American goods. Just like every other country does. China is building a huge railroad with their initial stimulus package made entirely out of Chinese products. Every country does this. It’s not controversial in the least.”’s David Sirota: “You’ll recall that when McCain took this stance during the campaign, Obama aired ads and released campaign material touting himself in the industrial heartland as the candidate who will stand up for Buy America laws. Now, Obama’s top aides seem to be working for McCain’s objectives. National elections should have consequences, and campaign promises in key swing states should be fulfilled. Call your senator and tell them to vote against the McCain amendment and stand up for Obama’s campaign promises.”

Senate Grapples With Amendments

NYT: “The Senate on Tuesday pushed the cost of the economic stimulus package above $900 billion by adding billions for medical research and tax breaks for car buyers. Angling to spur automobile sales as part of the economic stimulus package, the Senate voted to add an $11 billion provision to the bill that will allow most Americans to claim a tax deduction for the sales tax and any loan interest on the purchase of a new car between Nov. 12, 2008, and the end of 2009.”
CQ reports:

Senate Republicans demonstrated Tuesday that they could close ranks to force changes in the stimulus plan, defeating one Democratic effort to significantly boost the spending in the package and helping advance a tax deduction for car buyers.
But in a fluid debate over the bill, Republicans also agreed late Tuesday to an amendment from Tom Harkin, D-Iowa, that would add $6.5 billion for the National Institutes of Health, pushing the cost of the bill to $901.7 billion.
And a proposed tax break for companies that bring home profits from foreign operations, favored by many Republicans, was blocked.

GOP conservatives were gleeful after they sustained a budget point of order blocking an amendment from Patty Murray, D-Wash., that would have added $25 billion in additional infrastructure spending to the bill (HR 1).
“We’re back in the game,â€? said Sen. James M. Inhofe, R-Okla., who raised the point of order that drew a 58-39 vote, two votes short of the 60 needed.

Murray’s amendment sought to boost the bill’s highway funding from $27 billion to $40 billion, its transit funding from $8.4 billion to $13.4 billion, and its water and sewer funding from $6 billion to $13 billion.
“Investing in construction projects is the tried-and-true way to put people back to work,â€? Murray said.
But many Republicans objected, saying they supported adding money for infrastructure but wanted it offset with cuts elsewhere.
Two Republicans — Christopher S. Bond of Missouri and Specter — voted with the Democrats. Mary L. Landrieu, D-La., voted with the Republicans. Edward M. Kennedy, D-Mass., and Judd Gregg, R-N.H., did not vote.
Baucus, one of the floor managers of the bill, said he expects another attempt to increase infrastructure funding. “It’ll come back again,â€? he said.
But he appeared to bow to political reality when asked if there would have to be an offset. “We may have to trim up something. I don’t want to say full [offset], but something,â€? he said.

Why Not Bigger? Why Not More Transit?

NYT’s David Leonhardt explores concerns that the bill isn’t bigger:
“At these sizes, finding ways to spend the money can actually become a problem. High-speed rail cannot be built quickly. States and cities can build only so many highways. As for the military, administration officials say they asked the Pentagon for a list of temporary projects that could begin soon. But the $10 billion of spending in the current bill covers them. Military barracks can be built quickly. Fighter jets cannot, especially when defense contractors are already operating at nearly full capacity…”
“Why not redouble efforts to find a few other ways to spend money quickly? More than 50 mass transit agencies across the country are cutting services or raising fares, and the stimulus bill does nothing for them.”
TNR’s Brad Plumer adds: “Giving transit agencies aid to balance their budgets would prevent layoffs, and could even be used to enable fare cuts for buses and trains—a de facto tax break that benefits people likely to spend the extra money. This is spending that Congress could disburse right away, and the whole thing would be terrific from an enviro standpoint. Is there any good reason we’re not doing this? I’m genuinely curious.”
Grist’s Kate Sheppard on Boxer-Inhofe (!) highway amendment: “Transit advocates are irate at reports from Capitol Hill that Sen. Barbara Boxer (D-Calif.), chair of the Environment and Public Works Committee, might support an increase to highway funding in the economic-stimulus bill … Transportation for America, a coalition lobbying for better transit policy, sent out an action alert on Tuesday urging folks to contact Boxer’s office.”
Beat The Press’ Dean Baker says bigger is not hard: “Actually, it is not difficult to design a stimulus package that could provide a larger boost to the economy. For example, if Congress offered a generous tax credit for firms to provide health care insurance to workers who are not currently covered (and opened up Medicare to everyone) it could easily raise the stimulus package to the size advocated by Krugman and others. Alternatively, Congress could provide tax breaks to support substantial reductions in the work week or work year, while leaving pay unchanged. Either mechanism could productively add $200 to $300 billion to the size of an annual stimulus package. Of course, economists who could not recognize an $8 trillion housing bubble may not be creative enough to understand these policies.”
Alan Blinder offers ideas for fast spending in WSJ: “To fast-acting spending, like projects that are really — I mean really — shovel-ready. To federal grants that forestall state and local government cutbacks and tax increases. To payroll tax cuts, rather than business tax cuts. And to other tax cuts and transfer payments for people who live hand-to-mouth — expanded unemployment benefits and health insurance for the unemployed being two excellent examples. And if you really want to think big, I’ve suggested turning state sales tax rates negative for a year or so, with the federal government making up the lost revenue.”

Bad Bank Alternatives

George Soros in WSJ opposes the “Bad Bank” concept for the next stage of the financial bailout: would be a mistake to take the “bad bank” route, especially when there is a way to adequately recapitalize the banks with currently available resources. The trick is not to remove the toxic assets from the banks’ balance sheets but instead put them into a “side pocket,” as hedge funds are doing with their illiquid assets. The appropriate amount of capital — equity and unsecured debentures — would be sequestered in the side pocket.
This would cleanse bank balance sheets and transform them into good banks but leave them undercapitalized. The same $1 trillion that is now destined to fund the bad bank could then be used to infuse capital into the good banks.
Although the amount needed to recapitalize the banks would be more than $1 trillion, it would be possible to mobilize a significant portion of the required total amount from the private sector. In the current environment, a good bank would enjoy exceptionally good margins. Margins would narrow as a result of competition, but by then the banking system would be revitalized and nationalization avoided.
The scheme I am proposing would minimize valuation problems and avoid providing a hidden subsidy to the banks. Exactly for that reason it is likely to encounter strong resistance from vested interests.

As does Robert Borosage in HuffPost:

There is a sensible way to go forward: do what the government does routinely with badly run banks that face insolvency. As Rob Johnson, the former chief economist of the Senate Banking Committee at the time of the Savings and Loan crisis, and a member of my board at the Institute for America’s Future, describes it:
“Put them in receivership. Replace the managers. The shareholders take their losses. Make an independent assessment of the assets. Net out the credit default swaps that are the scariest threat to all. If necessary, the creditors take a hit, and have some of their loans turned to equity shares. If necessary, strip out the toxic assets, with federal contractors selling them over time. Reorganize a stronger and smaller bank and sell it back to private investors or merge it with other banks.”
The FDIC knows how to do this, and has done so with banks large and small. … Admittedly, taking on the commanding heights banks at once would be a formidable challenge. But it would be a lot less costly and a lot more certain than continuing the voodoo.
You can hear the howls: this is nationalization, socialism, un-American. No, it is how the FDIC has operated since the Great Depression to deal with the incompetent, the unlucky, the scoundrels and wastrels that run banks into the ground. It enforces responsibility. Managers get fired, rather than pocket bonuses. Shareholders lose their investments, rather than getting a taxpayer funded boondoggle. Creditors are protected, but only to an extent. The zombies are put to rest; the strong carry on.

New Executive Compensation Rules

NYT: “The Obama administration is expected to impose a cap of $500,000 for top executives at companies that receive large amounts of bailout money, according to people familiar with the plan. Executives would also be prohibited from receiving any bonuses above their base pay, except for normal stock dividends … Executives at companies that have already received money from the Treasury Department would not have to make any changes. But analysts and administration officials are bracing for a huge wave of new losses, largely because of the deepening recession, and many companies that have already received federal money may well be coming back.”
Sen. Bernie Sanders gave qualified praise on MSNBC’s Rachel Maddow Show: {font-size:11px; font-family:Arial, Helvetica, sans-serif; color: #999; margin-top: 5px; background: transparent; text-align: center; width: 425px;} .msnbcLinks a {text-decoration:none !important; border-bottom: 1px dotted #999 !important; font-weight:normal !important; height: 13px;} .msnbcLinks a:link, .msnbcLinks a:visited {color: #5799db !important;} .msnbcLinks a:hover, .msnbcLinks a:active {color:#CC0000 !important;}

Will Loss Of Daschle Setback Healthcare Reform?

NYT airs varying views:

Health care advocates lamented Mr. Daschle’s departure. “This is a very real setback for the administration because Daschle has unique qualifications,â€? said Drew E. Altman, president of the Kaiser Family Foundation, which focuses on health policy. “His withdrawal might result in a loss of momentum, but I don’t think it’s a fatal blow.â€?
William A. Galston, a former policy adviser to President Bill Clinton who is now at the Brookings Institution, said Mr. Daschle combined political, policy and legislative experience. “I’ve been trying to wrack my brain to think of another person who could bring those three things together,â€? Mr. Galston said. “I’m not getting very far.â€?
Others played down Mr. Daschle’s importance, pointing to Mr. Obama’s commitment to the issue. “That’s not dependent on Tom Daschle or any one person other than Barack Obama,â€? said Richard J. Kirsch, the national campaign manager of Health Care for America Now, a grass-roots coalition.
Skeptics of Mr. Obama’s approach to health care were relieved. “We had some serious concern about Daschle’s desire to rush health care reform and push something through as quickly as possible,â€? said James P. Gelfand, senior manager of health policy at the United States Chamber of Commerce. “The administration could come up with a better consensus-builder.â€?
… Senator Max Baucus of Montana, chairman of the Finance Committee, and Senator Edward M. Kennedy of Massachusetts, chairman of the health committee, have been pushing forward on legislation for weeks … Mr. Baucus said Tuesday that he had spoken with Mr. Kennedy and planned to take up a health bill by summer. He dismissed the importance of the Daschle withdrawal. “It’s barely a little ripple in the water,â€? he said. “It’s not a wave, just a ripple.â€?

LA Times: “Nonetheless, many lawmakers said Tuesday they have no plans to slow down.”
The Treatment’s Jonathan Cohn: “Can health care reform go ahead, this year, even without Tom Daschle? Yes. Does this episode–and Daschle’s absence–make the task of enacting health care reform harder? Yes, although how much harder is difficult to say right now … as one senior administration official just told me, ‘the most passionate advocate for health reform in the administration is staying put–right in the Oval Office.'”
The Plum Line: “Daschle’s Deputies Remain, Which Bodes Well For Health Care Reform”

Climate Crisis: Boxer Announces Principles

W. Post:

Yesterday’s announcement highlighted how much the political ground has shifted in Washington on climate change. Boxer, alluding to last year’s failed cap-and-trade bill, said, ‘A lot of those who voted against us are no longer here, and they have been replaced by some of the people behind me.’ But it also underscored the challenge lawmakers face in enacting a federal carbon cap. Boxer would not specify the exact emissions reduction targets she will seek, identify which Republicans might support her panel’s eventual proposal, or estimate when the full Senate might take it up for a vote…
…key players outside Washington are also reaching out to the new administration on the issue. Mary Nichols, who heads the California Air Resources Board, met with [the EPA] yesterday … “You have to have caps” on carbon, Nichols said in an interview before the meeting. “If you start out with the conception you’re doing the best you can, that’s never going to be good enough.”

Grist’s Kate Sheppard: “The principles call for a bill that uses a market-based system to reduce greenhouse-gas emissions, with both short- and long-term targets. But Boxer declined to say what those targets might be or whether she endorses the goals set out by President Barack Obama, who in his campaign called for reducing emissions to 1990 levels by 2020, and 80 percent below 1990 levels by 2050 … Boxer called for revenues from the auction of emission credits to be used for renewable-energy and energy-efficiency programs, assistance to consumers, worker transition programs, and domestic and international adaptation efforts. She did not say what percentage of credits should be auctioned off versus given out to emitters free of charge. Obama has called for 100 percent of the credits to be auctioned. Boxer said only, ‘We’ll look at that.'”
Climate Progress sees no legislation this year

Conservatives Set Sights on Solis

Weekly Standard and RedState try to make “conflict of interest” hay out of Labor Secretary nominee Hilda Solis supporting the Employee Free Choice Act, and being a member of non-profit that supports the Employee Free Choice Act.

SCHIP Expansion Becomes Law Today

The Page: “The president will sign a bill into law in the East Room Wednesday afternoon extending health care coverage to 11 million low-income children.”

Progressive Breakfast: Light Up The Phones

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

Light Up The Phones!

Call your Senators toll-free at 1-866-544-7573 and demand immediate passage of the American Recovery and Reinvestment Act.’s Bernie Horn, “Stand Up and Fight!”: “Here in Washington, D.C., the word on the street is that the Right is killing us with phone calls to Congress. One congressperson said the calls are running 100 to 1 against the Obama economic recovery plan. The legislation is now on the Senate floor. If Senators perceive that Americans side with Obama in this fight, that will strengthen the power of progressives in the debate and we’ll get a good bill. If, on the other hand, Senators are feeling the heat from conservatives, then our advocates will be weakened and we’ll get a lousy bill. That’s just the way things go on Capitol Hill. Those who worked for the election of Barack Obama and are currently sitting on the sidelines waiting to see how his economic recovery bill turns out — it’s time to stop waiting. Stand up and fight!”
Fact-esque (via The Sideshow): “It’s the Superbowl of Activism and We’re Losing Big … Enemies of the stimulus package are outcalling the supporters of economic recovery by enormous numbers … Go through your email lists – think of people to ask to make a call and follow-up with them. Consider this a warm-up for the coming health care battle, which will make this fight look like a poolside nap on a summer day.”
Economist James K. Galbraith, on, says don’t “waste time dickering”:

This glum scenario leads me to argue that this fiscal package is a good start, but only a start. Action should be swift, but expectations should be low. People should accept the possibility that the slump will go on for much longer than “several months.” That the budget will not return toward balance any time soon. And that further significant steps will be required, and perhaps quite quickly, as the economy continues to unravel.
The administration and Congress should not waste time dickering over the details of this package. Rather, they should enact it quickly, get things moving, and then come back to discuss the next steps. In my view, the crisis isn’t going away, and we are going to be thinking about it and dealing with it for many months, even years, into the future.

DailyKos’ BarbinMD: “a cadre of unions and progressive groups are ‘putting Senators on notice,’ with an ad buy … targeting Republican Senators for their vote on Barack Obama’s American Recovery and Reinvestment Plan, set to be debated this week in the U.S. Senate. The ads, running on both radio and television, are aimed at Richard Lugar (IN), Kit Bond (MO), Mel Martiniez (FL), Jim Bunning (KY), and Richard Burr (NC).”
Check out the Americans United For Change ad below:

Poll Watch: People Want The Bill To Pass. With Changes. But What Changes?

Watch for conservatives to crow about this new Gallup poll. “A strong majority of Americans (75%) want Congress to pass some version of President Obama’s economic stimulus plan, but this group is split down the middle on whether it should be passed as is or with major changes.”
Conservatives will say only 38% want is passed as is. BUT they should not be allowed to assume all that want changes are conservatives. 43% of Republicans want passage with major changes, but so do 30% of Democrats. Change could be more infrastructure spending or more business tax cuts. Such questions were not asked in the poll.
Further, all the so-called “pork” only amount to 1 percent of the bill. Not exactly “major changes.”
Most importantly, what’s indisputable is that 75% want government action to fix the economy. Only 17% say reject any bill.
UPDATE: FiveThirtyEight analyzes all the polling: “…there is some evidence … that the stimulus has become less popular. There is no evidence … that the stimulus has become unpopular; on the contrary, the preponderance of polling evidence suggests it remains a course of action that most of the public likes.”

Amendments On Tap

CQ Politics lays out the amendment landscape:

The first amendment scheduled for debate is a proposal from Patty Murray, D‑Wash., and Dianne Feinstein, D-Calif., that would boost the bill’s highway funding from $27 billion to $40 billion and its transit funding from $8.4 billion to $13.4 billion.

John Ensign, R-Nev., is leading an effort, backed by many business groups, to temporarily reduce the tax rate that corporations pay when they repatriate earnings from overseas. The language in his bill is expected to be similar to a 2004 temporary repatriation holiday that won the votes of 20 Democrats who are still in the Senate.
Democratic opponents, led by Carl Levin of Michigan and Byron L. Dorgan of North Dakota, say the provision would encourage companies to move abroad.

Budget Chairman Kent Conrad, D-N.D., said he is talking with senators about an amendment that would shift about $50 billion in the bill, mostly toward programs to address the struggling housing market.
Conrad said some of that funding would likely go to the Federal Deposit Insurance Corporation to renegotiate mortgages, as well as to expanding a refundable tax credit for homebuyers. Some Republicans want to expand that credit to as much as $15,000, but Conrad said that may be too expensive.

Some lawmakers want more radical surgery. Mel Martinez, R-Fla., is floating a $713 billion alternative package that focuses on tax cuts but, unlike the House Republican substitute offered last week, does include some spending. “There’s a nucleus of Republicans who realize the need for economic stimulus,â€? Martinez said.
His plan would temporarily cut the employees’ share of the payroll tax from 6.2 percent to 3.1 percent and cut the corporate tax rate from 35 percent to 25 percent. It would also increase a tax credit for home purchases to $15,000 for all homebuyers and reduce the top tax rate to 25 percent for small-business owners who file under the individual section of the tax code.

Susan Collins, R-Maine, said she was working with Ben Nelson, D-Neb., on amendments that would yield a bill of about $650 billion by deleting provisions that would not create jobs.
“We’re still in the midst of that process,â€? she said after several weekend discussions with Nelson. “My goal is to come up with a more targeted package. We’re not there yet. We’re still working.â€?
And Nelson, citing $1.5 billion for NASA as an example, said too much of the bill was not stimulative. “I can’t support the bill that’s there,â€? he said.

W. Post also reports on upcoming amendments:

Republican amendments will seek to lower mortgage rates and to cut income tax rates for the bottom two brackets. Senate Minority Leader Mitch McConnell (R-Ky.) said one target would be a “Buy American” provision that critics warn could spark a global trade war. Republicans also strongly oppose the hefty state aid portion of the bill that would help cash-strapped state and local governments to meet soaring Medicaid, education and other public-service costs.
Democrats also will seek changes to the bill. Sens. Barbara Boxer (D-Calif.) and John Ensign (R-Nev.) want to add tax changes to allow companies to repatriate offshore profits. Sen. Ben Nelson (D-Neb.) and Sen. Susan Collins (R-Maine) are collaborating on an amendment that would cut the overall package by about $200 billion, through the elimination of various non-stimulative provisions.
And Sens. Russell Feingold (D-Wis.) and John McCain (R-Ariz.) will attempt to secure their long-sought earmark reform legislation by attaching it to the must-pass bill.

Bloomberg (via Eschaton) reports on Schumer’s transit amendment:

New York Senator Charles Schumer is pushing to add another $6.5 billion for mass transit to the $819 billion U.S. economic stimulus package, calling buses, subways and trains the “lifebloodâ€? of the nation’s biggest city.
The Democrat’s amendment to the bill would increase funding to $14.9 billion from $8.4 billion, including $2 billion for capital transportation needs, $2 billion for railways and $2.5 billion for new transit projects.

W. Post reports throws cold water on the proposed tax break for multinationals: “A Senate committee has launched an investigation into potential abuses of a 2004 law that granted a one-time tax holiday to multinational corporations returning foreign earnings to the United States. The probe is intended to dampen enthusiasm for tucking a similar provision into the Senate’s $884 billion economic stimulus package. Sen. Carl M. Levin (D-Mich.), chairman of the Senate permanent subcommittee on investigations, said he has instructed the panel to determine whether companies that took advantage of the tax holiday used the cash to create jobs, as Congress had intended, or used it for other purposes, such as repurchasing their own stock, as one study suggests.”
W. Post reports the President is pressing congressional leaders to strip out anything that looks like pork: “Later in the day, Obama hosted the Democratic congressional leadership for an hour-long West Wing meeting to discuss the bill’s status in the Senate … two Democratic sources with knowledge of the meeting said the president took a blunt tone with the lawmakers, urging them to drop whatever needs to be cut from the bill to gain bipartisan support and to pass Congress soon. One source said Obama appeared to be frustrated by the public perception that the recovery bill was becoming laden with partisan pet projects.”
USA Today puts negative spin on minor differences in job estimates.

What’s the GOP Strategy?

Salon’s Mike Madden analyzes:

Chances are, though, that any attempt to stop the bill by filibuster would fall short. Democrats won’t have to sway more than one or two Republicans to move ahead with the legislation. Already, Senate Republicans are trying a different and less obstructive strategy than that of their House counterparts. Sure, McConnell is talking tough, but he apparently realizes the “all tax cuts, all the time” angle the House GOP pushed won’t fly. Instead of simply demanding lower taxes, now and forever, the Senate Republicans plan to focus on propping up housing prices through the stimulus bill … That plan might put the country back on a path for another housing bubble, but it probably sounds a lot more attractive to voters — or, at least, voters with mortgages — than, say, cutting business taxes…
The Senate GOP hasn’t yet, and probably won’t, draw a line in the sand, the way House Republican leader John Boehner did last week, telling his flock to vote against the bill just hours before Obama went to the Capitol to meet with them about it. Depending on exactly what’s in the final product, Senate Republicans could even learn to love the price. “The bottom line is a problem because of the way it’s being spent,” one GOP aide said. “If the bottom line creates jobs and gets us out of this economic mess and then generates tax revenue, that’s one thing. If it’s just spending money on a bunch of crap, it’s another.” What might determine how many Republicans vote for the bill in the end is what the definition of “a bunch of crap” is. The White House has about two weeks to fight that one out.
And about those House Republicans, the ones who are still crowing about last week’s shutout: Many of them may wind up flipping too.

Will Tax Cuts Work?

McClatchy analyzes the various tax cut provisions:

In tough economic times, consumers and businesses typically pay down debt and save money in case problems grow worse. That’s rational behavior and one reason why consumer spending has plunged. Usually, consumption drives about two thirds of U.S. economic activity. If people are saving, they’re not spending, and the economy contracts.
“If people want to save, giving them money will not force them to spend it,” Williams said.
To counter this, the Senate measure would put more money into people’s paychecks in small amounts that would be more likely to be spent than saved. Academic research shows that small increases in paychecks are viewed as “spendable” income, while larger lump sums are viewed as wealth to be saved.
The legislation would reduce taxes withheld from paychecks. This involves a refundable tax credit worth up to $500 for single filers and $1,000 for joint filers over one year.
Other tax measures in the Senate bill are designed to support poorer Americans who presumably would spend, not save, the money. These include expanding the earned income tax credit and the child tax credit. These wouldn’t immediately stimulate the economy since they’re claimed on tax forms, and the expansion would apply to the 2009 tax year.
The Senate bill also includes a number of tax provisions designed to free up cash for businesses, but how well they’d work is in dispute. Many of these provisions were sought by the U.S. Chamber of Commerce, which thinks that the Senate effort isn’t sufficient.

McClatchy also reports that a Chamber of Commerce proposed tax break would benefit a “homebuilder that’s under federal investigation and has left starter home communities in Charlotte, N.C., struggling with foreclosures.”

Some Liberals Still Pushing For a Bigger Bill

NYT’s Bob Herbert pushes for more infrastructure investment: ” When you juxtapose this tremendous national need with the wholesale destruction of employment that has occurred over the past several months (and that is expected to continue for some time), you have to wonder why President Obama and Congressional leaders are not moving with extraordinary quickness to put together an infrastructure investment program that is both vast and visionary. Instead, we have infrastructure spending in the Democrats’ proposed stimulus package that, while admirable, is far too meager to have much of an impact on the nation’s overall infrastructure requirements or the demand for the creation of jobs.”
Arianna Huffington rounds up concerns that the package should be bigger from Van Jones, Joseph Stiglitz, Jeffrey Sacks and Rick Levin.
DailyKos’ MeteorBlades: “The argument will be made, of course, that the Senate will never pass a larger bill. That boosting the total now will only make a filibuster more likely. And that even if a larger bill were to clear the Senate, it would never clear the House-Senate Conference Committee. Perhaps that’s true. But it can’t be certain until it’s tried.”
Robert Reich in Salon notes these may be fights for later: “…the moment the economy appears to be on the mend, conservatives such as [Martin] Feldstein will want the government to cut spending. In their view, this is the only way to get the economy fully back on track. But others believe that it is precisely the track we were on that got us into this mess in the first place.”

Buy American Update

The Hill reports Obama aides seen as “free-traders” are not opposing the “Buy American” provisions in the econ recovery bill, which may help secure GOP support in the Senate:

Free-traders on President Obama’s economic team are suppressing concerns over Buy American provisions in the stimulus, derided as protectionist by corporate lobbyists.
Treasury Secretary Timothy Geithner and Obama’s top economic adviser, Lawrence Summers, have raised no objections to tough provisions in the House stimulus bill intended to ensure that U.S. iron and steel are used in any infrastructure projects, such as the construction of highways and bridges, even if they add to the project’s cost.
Nor have they complained about a provision in the Senate bill that would go much further by calling for the use of U.S. iron, steel and other manufactured goods in infrastructure spending in the stimulus.

Robert Reich, President Clinton’s secretary of Labor, said Summers and Geithner have probably calculated the criticism from abroad and decided that the higher costs of some projects are worth the political price.
“[I]n this case, when American taxpayers are paying a huge amount of money to stimulate jobs in the United States, the argument can be made that the extra cost to the government and the slight antagonism of foreign governments may be worth it,â€? said Reich, who sparred with Summers and Clinton Treasury Secretary Robert Rubin over trade.
He said if the U.S. stimulus bill leads foreign governments to pass similar bills benefiting their own domestic industries, “so much the better.â€?

Reich and some supporters of the provisions in the stimulus bill say they doubt the new language will make a difference, since Buy American provisions already apply to most federal contracting. The chief difference in the language backed by Rep. Pete Visclosky (D-Ind.) and approved by the House is to raise a threshold for exempting Buy American law. Under the stimulus, using U.S. iron and steel must raise the cost of a project by 25 percent, instead of 6 percent, for the Buy American requirement not to apply.
Like Reich, Lori Wallach, director of Public Citizen’s Global Trade Watch and a free-trade critic, said those criticizing the Buy American provisions in the stimulus are overstating their case that it will lead to a trade war. She said past Buy American laws have required the use of domestic goods unless that would have raised the cost of a project by 50 percent.

Scott Paul, executive director for the Alliance for American Manufacturing (AAM), whose members include the United Steelworkers, noted that several countries with large economies, including China, give preference to their own materials in their projects and thus don’t receive waivers allowing some of their goods to be used for U.S. government programs.
He also said the provisions could help win a couple GOP votes in the Senate, where Obama needs and wants to find bipartisan support. Paul suggested that GOP senators from manufacturing states, including Ohio, Pennsylvania and Maine, would be opposing such provisions at their own peril.
Those states’ centrist Republican senators — George Voinovich (Ohio), Arlen Specter (Pa.), Olympia Snowe (Maine) and Susan Collins (Maine) — have yet to declare their position on the stimulus.
Voinovich, however, opposes the Buy American provisions, his office said.

Bad Bank Update

WSJ has the latest speculation on the next stage of the financial bailout:

The administration hasn’t finalized its plans for the heart of the bank rescue. It is considering a series of steps that would inject money into financial firms while relieving them of their toxic assets. The administration is considering a two-pronged approach that would further help banks by having the government buy a portion of their bad assets while offering guarantees against future losses on some of the remainder.
The administration continues to wrestle with the details, including what the government should pay for the troubled assets that are hampering the balance sheets of financial institutions. Mr. Geithner has assigned teams of staff to explore alternatives and is expected to present a plan to Mr. Obama shortly.
Ahead of the speech, seeking to improve public perception of the $700 billion financial rescue, the administration is this week expected to announce tougher executive-compensation restrictions for some firms that get government aid. That could help lay the groundwork with politicians and the public, who have grown weary of bailing out banks. The administration, realizing the public is expecting quick action, seems poised to announce some of its efforts in stages.
The tougher rules would apply to banks that receive a substantial amount of money. Chief executives of firms that receive “exceptional” aid will be banned from receiving any severance payments and they, along with the top 50 executives, will see their bonus pools shrink by about 40% from 2007 levels.
The Obama administration hasn’t detailed what qualifies as “exceptional” aid, but government officials say the rules will apply in cases in which the U.S. provides significant dollars, along the lines of what has been given to American International Group Inc., Citigroup Inc. and the Detroit auto makers.

W. Post’s Allan Sloan proposes a “common stock” solution: “Let the Treasury convert taxpayers’ preferred stock to nonvoting common stock at current prices. That would reduce the income and protection that taxpayers get from owning preferred stock rather than common stock but would give us stakes of about 73 and 56 percent, respectively, in Citi and Bank of America. And that way, we taxpayers would get paid, but we wouldn’t have Congress or the federal bureaucracy trying to run the banks and allocate capital. Such a move would accomplish what I’ve suggested since 2007: Dilute common shareholders massively while letting the banks stay open, lest closing them precipitate ‘systemic failure.’ The dilution would inflict pain in the right places — institutional shareholders — and perhaps cause them to police their investees in the future. Yes, having the government own majority stakes in these banks isn’t a good long-term solution. But letting them muddle around and bleed and whine isn’t working really well either. ”
The Back Forty promotes the Common Good Bank Project: “Common good banks will be community-based savings banks, designed to provide local economic stability even in the event of national or global economic collapse. Banks will be legally chartered and insured by the FDIC (which insurance is fine as far as it goes, but if a large number of banks fail at once, even the FDIC won’t be able to cover everyone’s losses.) The overall idea is to keep money and decisions about its use in the hands of people like us, rather than turning control over to corporations so they can tell us how much we may have and under what circumstances.”

Going Nuclear?

W. Post reports on battle over nuclear power in the econ recovery bill:

Environmental groups are protesting a proposed $50 billion increase to an existing federal loan guarantee program for “innovative” energy technologies that could expand funding beyond renewable energy to include nuclear power and certain kinds of coal plants.

Both nuclear supporters and foes are uncertain about how much support to expect from the new Energy secretary, Steven Chu, who is a strong supporter of action on climate change. During his confirmation hearing, Chu pledged to expedite the release of existing loan guarantees, but he avoided any commitment to an aggressive expansion of nuclear power.
Daniel J. Weiss, senior fellow and director of climate strategy at the liberal Center for American Progress, said “this could be a real contentious issue in conference” when House and Senate negotiators try to reconcile the different versions of the stimulus package.
“This is the exact kind of spending President Obama said he didn’t want in the recovery package. It will take a lot of time to spend this money and, once you do, it won’t create many jobs,” he said.
He added that it would take years to design, permit and start building nuclear power projects, and that nuclear power companies were “hoarding these loan guarantees to use at a different time.”
Nuclear power proponents maintain that that the nation needs to expand its nuclear power capacity to keep pace with electricity demands and do so in a way that does not add greenhouse gases.

Progressive Breakfast: Senate’s Turn on Econ Recovery

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

Senate Debate on Econ Recovery Starts Today. More Infrastructure On Tap?

Call your Senators toll-free at 1-866-544-7573 and demand immediate passage of the American Recovery and Reinvestment Act.
NYT: “Senators of both parties also said on Sunday that they expected a significant amount of additional money — about $20 billion to $30 billion — to go toward infrastructure spending on such things as roads and bridges. Senator Schumer also said he supported an additional $5 billion for mass transit spending.”
On NBC’s Meet The Press, Sens. John Kerry (D-Mass.) and Kay Bailey Hutchison (R-Texas) crystallize the debate between public investment and tax cuts. Guess which is based in reality!

KERRY: We’ve had eight years of this experiment of massive tax cuts without investing in America’s future, and the result is we have gone from fourth in broadband to 17th in the world. The fact is our transportation system is neglected, you can’t move products from here to there as effectively as other places. We waste countless hours of American productivity on roads that are clogged with traffic because we don’t invest in mass transit. I think the experiment in the last eight years, that’s what this election was about. We just had an election. The American people overwhelmingly voted for change.

HUTCHISON: It is the tax cuts that caused the economy to start going in the right direction. It was the 15 percent capital gains and dividends break that made people go back into the stock market. It was lowering everyone’s tax bracket.

Hutchison also tried to position herself as pro-infrastructure: “I think you should take out the social spending that is not going to create jobs and add to the infrastructure spending which will create jobs.”
Conservative Dem Sen. Ben Nelson keeps echoing GOP talking points on “wasteful” spending.
NYT finds lots of shovel-ready projects in financially-distressed California.
Media Matters slaps W. Post editorial board after it pinned blame on Obama for having “controversial provisions removed [from the economic recovery bill], but too late to win over Republicans.”
TPM’s Josh Marshall nails DeMint for spewing utter ignorance: “I cannot say my expectations were high. But Sen. DeMint (R) of South Carolina does seem to be an even bigger ignoramus than I’d realized. On This Week this morning he actually said: “Let’s don’t say it’s a stimulus when it’s a government spending plan.” A ‘Stimulus plan’ is pretty much by definition a spending plan, though of course it can include tax reductions as well … I’m wowed by the amount of nonsense and lies that are being injected into this debate.”
FireDogLake’s Jane Hamsher nails DeMint for typical revisionist Reagan history.
FireDogLake’s Blue Texan: “Jim DeMint Gets His Ass Handed to Him by Entire Panel on Stimulus Bill”
The Hill: “Some in GOP hint they will back final stimulus measure”

More Debt Is Fiscally Responsible and Manageable

On Meet The Press, Economist Mark Zandi and CNBC’s Erin Burnett agree that increased deficit spending is manageable so long as the funds are invested well:

ZANDI: [The debt is] 40 percent of GDP now. If the projections are right, we get to 60, maybe 70 percent of GDP, which is high, but it’s manageable … in our history we’ve been higher … moreover, it’s very consistent with other countries and their debt loads … just as important, investors understand this. They know this and they’re still buying our debt and interest rates are still very, very low. So we need to take this opportunity and be very aggressive and use the resources that we have at our disposal.
BURNETT: It’s true. But you look at 67 percent, that’s where Japan was when they did their first stimulus package back in 1989, and then they ended up going, obviously, significantly higher than that … you’re right, it’s manageable, other counties are there. But … if you’re not spending that money well, you’re going to have to keep spending more and more and more.

HuffPost’s Adam Green rips Burnett for defending Wall Street bonuses: “what she’s doing here professionally is a real problem, and it’s NBC’s problem at the end of the day. The public simply can’t afford to have economic news given to us by Wall Street ’embeds.'”

Bad Bank Debate Heats Up

President Obama discusses what a “bad bank” would look like on NBC’s The Today Show saying “some banks won’t make it” and “the government is going to have to support some banks.”

PRESIDENT OBAMA: We’re not going to be spending $4 trillion worth of taxpayer money. … it is likely that the banks have not fully acknowledged all the losses that they’re going to experience. They’re going to have to write down those losses. And some banks won’t make it. Other banks [we] are going to make sure that we strengthen. All deposits are going to be safe for ordinary people. But we’re going to have to wring out some of these bad assets.
MATT LAUER: Are you going to set up a “bad bank” … ?
PRESIDENT OBAMA: I don’t want to preempt an announcement next week. There’s a lot of technical aspects to it. And if I say that we’re doing one thing, then the markets might interpret it differently from what it ends up being.
But the basic principle [will be] that we’re going to have to see some of this debt written down, that the government is going to have to support some banks, that others that are not viable — essentially that we’re going to have to do something with those assets. {font-size:11px; font-family:Arial, Helvetica, sans-serif; color: #999; margin-top: 5px; background: transparent; text-align: center; width: 425px;} .msnbcLinks a {text-decoration:none !important; border-bottom: 1px dotted #999 !important; font-weight:normal !important; height: 13px;} .msnbcLinks a:link, .msnbcLinks a:visited {color: #5799db !important;} .msnbcLinks a:hover, .msnbcLinks a:active {color:#CC0000 !important;}

Krugman expresses opposition to a “Bad Bank” without temporary public ownership of rescued banks:

If taxpayers are footing the bill for rescuing the banks, why shouldn’t they get ownership, at least until private buyers can be found? But the Obama administration appears to be tying itself in knots to avoid this outcome.
If news reports are right, the bank rescue plan will contain two main elements: government purchases of some troubled bank assets and guarantees against losses on other assets. The guarantees would represent a big gift to bank stockholders; the purchases might not, if the price was fair — but prices would, The Financial Times reports, probably be based on “valuation modelsâ€? rather than market prices, suggesting that the government would be making a big gift here, too.
And in return for what is likely to be a huge subsidy to stockholders, taxpayers will get, well, nothing.

Saving the economy is going to be very expensive: that $800 billion stimulus plan is probably just a down payment, and rescuing the financial system, even if it’s done right, is going to cost hundreds of billions more. We can’t afford to squander money giving huge windfalls to banks and their executives, merely to preserve the illusion of private ownership.

NYT’s Hugo Dixon lays out his criteria: “Whatever version of bad bank is used, the same problems that bedeviled the Bush administration’s plan still need to be addressed. First, assets shouldn’t be insured (or bought) at deliberately inflated prices. That is just a straight handout from taxpayers to bank shareholders. Second, banks should pay a reasonable price for their insurance policy. Third, if they don’t have enough capital to pay for such insurance, they may still need further capital injections.”

Puffing Up Housing Bubble?

NYT: ” Senator Charles E. Schumer, Democrat of New York, said that Senate Democrats were interested in considering Republican proposals to do more to help the sputtering housing market, including instituting a $15,000 tax credit for all home buyers.”
Dean Baker: “For purposes of comparison, [$15,000 is] equal to roughly 5 years worth of a kid’s health care under the State Children’s Health Insurance Program and three years of TANF checks. It is difficult to see how someone is doing us any favors by buying a house. In many markets, there is still a bubble that has not yet fully deflated.”

Less Military Spending?

Newshoggers: “According to Fox News, Obama is proposing a measly 10% cut in the Pentagon’s declared budget. Predictably, wingnut heads are exploding” though it would still be higher than 2007 levels.
Time’s Joe Klein: “Defense research has spawned great American industries and it should be fed to the max. But the DOD is also the source of some of the government’s stupidest, most wasteful spending — the tens of billions spent on outdated, irrelevant weapons systems, and the unnecessary military bases that survived two rounds at base-closing … defense spending is no more righteous, and arguably less efficacious in the long-term, than spending on, say, carbon recapture or railroads–which may lead us to decrease our dependence on the Middle Eastern oil that causes us to send our sons and daughters off to unnecessary wars in the first place. Those who supported the $1 trillion expenditure that the war of choice in Iraq has cost us should be a bit more humble when it comes to criticizing government spending on such direct, job-creating programs as day care (which, by the way, is an absolute necessity for most military families).”

Safety Net Officially Shredded

NYT: “Despite soaring unemployment and the worst economic crisis in decades, 18 states cut their welfare rolls last year, and nationally the number of people receiving cash assistance remained at or near the lowest in more than 40 years. The trends, based on an analysis of new state data collected by The New York Times, raise questions about how well a revamped welfare system with great state discretion is responding to growing hardships.”
Conservative response from The Heritage Foundation? Let ’em eat cake! “Among those sanguine about current caseload trends is Robert Rector, an analyst at the Heritage Foundation in Washington who is influential with conservative policy makers. He said [welfare reform] had ‘reduced poverty beyond anyone’s expectations’ and efforts to dilute its rigor would only harm the poor.”

Grand Bargain?

W. Post front pager says that “Obama and his allies nonetheless have said that they view a grand bargain as a political imperative,” and implies that such a grand bargain entails, “Democrats agreeing to trim costly social programs and Republicans acquiescing to a major tax hike.”
But there is no actual reporting to support that’s what Obama means to accomplish.
In addition, Dean Baker in Beat The Press flays the Post: “The Washington Post continued its practice of placing editorials on the front page, telling readers today about the need to defuse ‘the spending time bomb for health and retirement programs.’ Of course this time bomb is entirely an invention of the Post. … There is nothing that resembles a time bomb in the case of Social Security … Medicare is projected to face serious shortfalls, but this is due to the projected explosion of health care costs in the United States. If the United States can repair its health care system, as President Obama has pledged to do, then Medicare costs would also be manageable.”
Earlier W. Post interview of Obama indicates he seeks only a minor tweak in Social Security and broader health care reform to reduce cost pressure on Medicare: “‘Social Security, we can solve,’ [Obama] said, waving his left hand. ‘The big problem is Medicare, which is unsustainable. . . . We can’t solve Medicare in isolation from the broader problems of the health-care system.'”

Buy American Debate

USA Today editorial board opposes provisions in economic recovery bill to Buy American: “A tit-for-tat round of retaliations in the form of buy-local provisions in stimulus measures could be disastrous for the United States, which sells about $1.7 trillion a year in merchandise and services abroad, about 12% of the economy. Big exporters such as Boeing and Caterpillar could see even more layoffs. A Buy American provision would also drive up costs of the stimulus, or limit what it buys, because in some cases foreign products would be cheaper or better suited to the task.”
Sen. Byron Dorgan defends the provision: “Of course, I recognize that there are a variety of products that are not made in this country anymore, and there also might be instances where U.S. products are not sufficient — either in quantity or quality. So my provision allows for these common-sense exceptions. But it just makes sense that, where possible, we try to stimulate our own economy, rather than the economy of other countries. Some decry the Buy American effort as the start of a trade war. They say it’s just disguised protectionism. That is thoughtless nonsense. It’s nothing of the sort. It is entirely within international trade rules to require that these kinds of public projects use American-made inputs.”’s David Sirota: “Will Obama Keep His ‘Buy America’ Promise?”

Shorter Work Week Gains Momentum

Last week, Dean Baker’s NY Daily News oped touted the shorter work week as a way to create jobs. Grist’s David Roberts then touted the green benefits.
Today, Stateline reports, “Four-day workweek grows on Utahns”:

…nearly six months into Utah’s Friday-off experiment, employee satisfaction is shifting in a noticeable way, and the three-day weekend doubles as a recruitment tool, enticing younger residents to work for the state, Hansen said.
A November 2008 survey of state employees found that the four-day workweek was growing more popular with usage. After four months, 70 percent said they preferred the schedule, compared to 56 percent before the change. The report also found that absenteeism and turnover rates went down.
Despite some kinks in the program, Utah saved $203,177 on custodial contracts in 2008.
Another byproduct is a dose of economic stimulus. Much of the $6 million that state employees are expected to save in commuting costs will be spent on goods and services.

White House Praises Unions, Will Unions Unify?

Marc Aminbder posts Biden comments on CNBC about EFCA:

Vice Pres. BIDEN: We’re going to try to push for [EFCA] prudently. By that I mean there’s only so much on the plate these first couple months. Everyone understands–I think both of us thought 10 months ago that this would be a top-priority item in terms of immediate action. We know there’s probably going to be some compromise here. We also know that we have to get more than just Democratic support for this. But we both believe it’s very important, making and–taking away the roadblocks that were built up. … we do think making it–taking away the impediments to organization is in the self-interest of labor, but also I believe in the self-interest of economic growth.
[CNBC’s JOHN] HARWOOD: Sounds like that is a 2010 or beyond issue.
Vice Pres. BIDEN: No, no, no, no. This year. This year, we hope. Our expectation is this year, this calendar year, that we will move, and hopefully with some bipartisan support, to dealing with this issue.

HuffPost’s Robert Kuttner offers ideas in advance of ECFA “Without Obama’s strong personal engagement, EFCA will be anything but a legislative cakewalk. Democrats may have a working majority. But at least five business-oriented Democrats are not considered certain votes for EFCA, and Obama will need to let them know that the White House considers this bill a top priority … If Obama is serious, he can take a leaf from FDR’s book, and use government’s extensive contracting power to actively promote unions. Late in the Clinton administration, then Vice President Al Gore led an effort … to reward federal contractors who took the high road by providing good jobs and not standing in the way of unions.”
LA Times’ Harold Meyerson frets over friction within UNITE HERE and SEIU: (via Working Life) “At a time when unions are battling for their lives in the fight over the Free Choice Act, two of America’s best unions are busy battling themselves.”

Progressive Breakfast: Party of No

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

House Backs Econ Recovery Plan

WSJ: “The House bill expands access to health care for the unemployed, represents perhaps the largest expansion of the federal government’s role in education financing ever and begins what Mr. Obama has promised will be a push toward renewable energy that will continue throughout his presidential tenure.â€?
MyDD’s Todd Beeton: “To Obama’s credit, notice The AP’s frame here: it’s a “swift victory” for Obama who has been making “pleas for bipartisan support.” Obama is winning this debate even though the Republicans think they can make him out to be the bad guy who is going back on his promises. Well played, Mr. President, so far.â€?
Jack and Jill raves: “‘I’m impressed so far with how Brother Barack has launched the first 100 days. He’s gotten a lot done in only about a week. Gives a body hope for the future. Things might get a bit worse economically (and therefore in folks’ everyday lives) before they get better. Yet a lot of people who really need a little help out there are finally, finally about to get some.â€?
New ads from Americans United For Change target Sens. Snowe, Collins, Murkowski, Grassley, Gregg for quick passage:
TPM’s Elana Schor says Senate prospects look good: “Brad Woodhouse, president of the Dem-allied group Americans United for Change, described the GOP’s stalwart opposition in two words: “political suicide,” the subject of his e-mailed statement on the stimulus vote. But maybe this was the Republicans’ plan all along. Now Senate Minority Leader Mitch McConnell (R-KY) and his troops can start the next act in the show and ask for just a few more concessions in order to give the stimulus its bipartisan stripes. Either way, with GOP Sen. Olympia Snowe (ME) signaling her support, its passage in the Senate by next week is looking assured.â€?
Pressure for quick action remains. Stateline: Jobless rates up in every state

What Other Fights Remain?

WSJ previews:

Top House and Senate Democrats are also negotiating major changes to longstanding efforts to help workers who lose their jobs to foreign competition. The Trade Adjustment Assistance program, created in 1962, would be broadened to cover a wider range of workers, including employees in service industries, from accounting to aircraft maintenance, lawmakers and congressional aides said.
As the sweeping measure moves to the full Senate next week, tussles loom that will eventually require Mr. Obama to referee differences between the House and Senate. The Senate is looking to add more business-friendly provisions, for example. Senate Finance Chairman Max Baucus (D., Mont.) is signaling a willingness to add amendments that would extend soon-to-expire tax breaks for U.S. timber companies, as well as strengthen a provision already in the bill that creates a tax benefit to encourage corporate debt restructuring.
An issue of keen interest to a wide coalition of businesses, including real-estate, home builders and telecommunications companies, is a proposal added in the Senate to allow companies to defer taxes in 2009 and 2010 that they would otherwise owe for restructuring or retiring debt. As currently written, the bill would require corporations to eventually pay back the taxes, and only applies when companies use cash to buy back debt.�

Reality-Based Community’s Jonathan Zasloff on transit funding: “Apparently some transit will survive in the stimulus, and that’s a good thing. But it’s not nearly enough, and remember, this thing still has to pass the Senate, which is even more tilted toward rural interests … Transit advocates need to assembly a lobby that can at least be in the same ballpark with highways. And so far, we haven’t.’”

Zero Republican Votes for Economic Recovery

TPM says GOP is the “Party of No”: “President Obama is extremely popular. The Stimulus Bill is pretty popular. Hill Democrats are reasonably popular. And Hill Republicans are deep in Bush unpopularity territory, as much as they now try to distance themselves from the man they once wrapped their party around. It grated on a lot of people — and I include myself — to see Obama going every extra length to cater to Republican nonsense. But it’s left little question who was doing what. One benefit the Republicans carry out of the 2008 election is that most of the remaining Republicans come from districts that are so red that it’s hard for Democrats to ever contest them. But not all of them. And in a lot the industrial Midwest especially, the GOP is the party of ‘no’.”
Booman Tribune sees a bargaining tactic:

CNN reported that about 30 Republican House members wanted to vote for the stimulus but were convinced to make this a unanimous rejection of ‘Pelosi’s bill’.
However, this is not the final bite of the apple for the House Republicans. The House version has to go to conference and be reconciled with the Senate version. At that point, the House will vote again on the final version of the bill which will then be signed by the president and become law.
So…those 30 Republicans will have an another opportunity to vote for the stimulus bill and two years from now, when they are up for reelection, no one is going to care that they voted against the stimulus today.
Why do Boehner and the other leaders want today’s vote to be unanimous? Because they still want to extract concessions in the conference. They want to bitch and moan about Pelosi’s bill. In the end, I suspect that a couple dozen Republicans will vote for the final stimulus bill. But they sent a message today that they have discipline.

Phil Singer has questions:

1) Will Obama use the fact that he continues to go out of his way to reach out to Republicans to paint the GOP votes against the package as intransigent and political? With Republicans refusing to heed his call to “proclaim an end to the petty grievances and false promises, the recriminations and worn-out dogmas that for far too long have strangled our politics,â€? Obama is in a position to use their votes against them.
2) Will House Republicans pressure their Senate counterparts to follow their lead and oppose the upper chamber’s version of the bill? Or will they push Senate Republicans to pass a stimulus measure that they can support (i.e. one with a fix for the AMT) when the two chambers meet to reconcile the differences between their respective versions of the bill? And will Senate Republicans even care what their friends in the House have to say?

Reality-Based Community’s Mark Kleiman has advice:

1. Democrats should never let the voters forget this. Republicans chose the opportunity to give an overwhelmingly popular new President the finger over the opportunity to work together to drag the economy out of the hole their policies left it in. In particular, those running in 2010 against the remaining Republicans from Blue districts should wrap this vote around the incumbents’ next; when push came to shove, they put party first, country last.
2. When the House and Senate bills go to conference, some of the concessions made in the name of bipartisanship — in particular some of the inequitable and uneconomic tax cuts — should be taken out, and replaced by, e.g., a payroll-tax holiday for employees. And we should be sure to put the birth control funds back into the bill, Republican politicians, their corporate paymasters, and their fundamentalist voters need to be taught the lesson that obstructionism has a price.â€?

TNR’s Michael Crowley looks to 2010: “As it happened [in the first Clinton term], in the long term the Republicans looked pretty dumb for opposing a measure that immediately preceded a huge economic boom. It is true, though, that in the near term the Clinton Democrats were annhiliated in the 1994 midterms. But that had more to do with other troubles–gays in the military, the Somalia fiasco, a pork-stuffed crime bill, and various House scandals–than the budget vote per se. That said, the 2010 midterm campaign is now very much underway.â€?
Jed Report: “GOP 100% Against Economic Recoveryâ€?
Oliver Willis: “No Republicans on board, but as we know… elections have consequences. The party of no can party along as the rest of us do work.â€?
Matthew Yglesias: “The lesson I would hope the administration learns here is this: He needs to spend less time seeking political cover to mitigate the downside to possible policy failure, and more time trying to implement the best policies he can.â€?
Canadian Michael Stickings calls Republicans anti-American: “the Republicans’ true colours are bright and clear. They may wrap themselves in the flag, and they may play the patriotism card whenever and wherever possible, but they’re actually the anti-American party. At a time when the American people need help, and when the new president and the majority party are willing and eager to rise above partisanship, the House Republicans, once again, put themselves before all else.â€?

Zero New Conservative Ideas

Balloon Juice rips House conservative tax cut plan led by Rep. Eric Cantor:“Considering the Republican plan when the economy was good and the coffers were full was tax cuts, and the Republican plan when the economy was lagging was tax cuts, and the Republican plan while we were fighting two wars and the deficit was rising was more tax cuts, and the Republican plan for, well, everything is tax cuts, I am going to go out on a limb and guess that the Republican plan for economic stimulus is going to be… tax cuts …. I keep hearing him say that the Republicans are dedicated to preserving jobs. Now, correct me if I am wrong, but didn’t Cantor and the GOP spend the last few months openly rooting for the failure of the auto industry in the hopes that several million union jobs would go up in smoke? But now they are all about job preservation?â€?’s Bill Scher on how House conservatives falsely claimed their all tax cut/no public investment plan would create 6.2 million jobs, by distorting a 1994 academic paper by one of Obama’s aides.

Next To Zero Dems On TV

ThinkProgress: “As Media Matters has documented, during the Bush administration, the media consistently allowed conservatives to dominate their shows, booking them as guests far more often than progressives. The rationale was that Republicans were ‘in power.’ It appears that old habits die hard. Even though President Obama and his team are in control of the executive branch and Democrats are in the majority in Congress, the cable networks are still turning more often to Republicans and allowing them to set the agenda on major issues, most recently on the debate over the economic recovery package.”

More Transit Added to House Bill

Streetsblog “The House just passed Jerrold Nadler’s amendment to add $3 billion for transit investment to the stimulus bill. There’s a lot more work coming up very soon — in the Senate and in conference committee — but this was a hard-fought win and everyone who helped push it through should take a minute to pat yourself on the back.â€?
Greater Greater Washington has more detail:

According to Nadler’s floor speech, 1.5 billion will go to the transit capital formula program, which goes to all states, and 1.5 billion to the new starts program. The AFL-CIO and environmental organizations will “score” this amendment, he said, meaning they’ll factor members’ votes on this issue into their scorecard ratings for each Representative. Since it was a voice vote, though, we don’t know who opposed the amendment, making that impossible.
John Mica (R-FL), ranking member of the Tranportation Committee and the House’s leading pro-transit Republican, called this “an amendment we have to support.” The Appropriations committee, he said, “took one of the most important parts out: that’s the rail and transit.” Transit infrastructure creates jobs, he said. “Support the Nadler amendment!”
Transportation Chairman James Oberstar (D-MN) added, “we heard very clearly from the major transit agencies in this country. They have options for buses. They have options for railcars that could be exercised within days.” Manufacturers can ramp up production and create jobs all across the nation.â€?’s David Sirota likes how this came about: “This week, this nascent progressive pressure system emanating from Capitol Hill and the outside progressive media/movement intensified … DeFazio’s call to action was followed up by an outside-inside campaign to add more transportation funding to the stimulus bill – outside pressure is coming from blogospheric drumbeating, inside pressure is coming from lawmakers sponsoring the amendment … Suddenly, we have a Congress pushing the executive branch to be more progressive – and that’s a big deal.”
Gristmill’s Kate Sheppard: Rep. Oberstar passed an amendment “that would mandate that funds for aviation, highway, rail, and transit come with a “use-it-or-lose-it” provisions, requiring that 50 percent of the funds be obligated within 90 days.â€?

TV Blackout?

Nicholas Beaudrot frames the House vote blocking a delay in digital TV transition: “THE 155 REPUBLICANS (AND 13 DEMOCRATS) WHO WANT TO TAKE AWAY YOUR TEEVEEâ€?
Latina Lista: “House Republicans negative vote on digital tv switchover disenfranchises millions of Latino and African American families”

TARP Take 2


As lawmakers pressed the Obama administration for details of how it would assist financial firms that have been rapidly deteriorating, Treasury Secretary Timothy F. Geithner said Wednesday the administration is working on a comprehensive plan to “repair the financial system.â€?
Mr. Geithner declined to provide any specific details or to address rising calls for the creation of a government institution to buy or guarantee the declining assets at several of the nation’s largest banks. He discouraged speculation that the plan would include the nationalization of some banks.
“We have a financial system that is run by private shareholders, managed by private institutions, and we’d like to do our best to preserve that system,â€? he said.
But bank stocks surged on hopes the government was moving toward creating a “bad bankâ€? to purge toxic assets from balance sheets that are rapidly deteriorating as the economy worsens.â€?

W. Post on congressional oversight panel report, and GOP dissent: “A congressional panel overseeing the government’s financial bailout has concluded that the economic crisis could have been prevented with better regulation and called for a raft of proposals to overhaul government oversight of the financial sector … The group urged creating a regulator with the authority to oversee financial firms whose failure poses a risk to the overall financial system. The panel also called for further regulation of the mortgage industry, hedge funds and derivatives, as well as limits on excessive borrowing by financial institutions … The Republicans plan to release a separate dissenting report … ‘Before embracing more government regulation as the only answer, such advocates should consider the many ways in which government regulation itself can be part of the problem,’ the Republican report said.”

Union Ranks Up, Mostly in Govt, While Union-Busting Persists

In These Times’ Art Levine: “A new report by the Bureau of Labor Statistics shows that union membership rose sharply last year, adding over 400, 000 new union members. But that growth occurred in the face of a wide range of legal and illegal unionbusting tactics and intimidation: Studies of hundreds of organizing campaigns have found that a fifth of all pro-union activists are fired during a campaign, half of all employers threaten to shut down their plant and roughly 80% of employers hire unionbusting consultants. Even so, as union activists point out, when workers are allowed to join unions, they do. ”
W. Post on business lobby reaction: “‘Organized labor is running ads claiming that current labor laws prevent them from signing up new members. Too bad the facts aren’t cooperating,” U.S. Chamber of Commerce chief legal officer Steven Law blogged yesterday. Union officials instead focused attention on the fact that the gains in unionization were largely achieved by federal, state and city government workers — and not at private companies. … Indeed, the rates of unionization between the private and public sector are starkly different. According to the new federal information, 7.6 percent of private-sector employees belong to a union, while about 37 percent of government employees do.”

Gore Calls For Cap-and-Trade and Global Treaty This Year

Al Gore’s Senate testimony: “Quickly building our capacity to generate clean electricity will lay the groundwork for the next major step needed: placing a price on carbon. If Congress acts right away to pass President Obama’s Recovery package and then takes decisive action this year to institute a cap-and-trade system for CO2 emissions – as many of our states and many other countries have already done – the United States will regain its credibility and enter the Copenhagen treaty talks with a renewed authority to lead the world in shaping a fair and effective treaty. And this treaty must be negotiated this year. Not next year. This year.â€?
US News: “…there were new indications that a cap-and-trade bill on carbon dioxide could emerge later this year, as a reassuring precursor to U.S. participation in next December’s climate change conference in Copenhagen … From the Republican ranks, there was much less vocal opposition to Gore’s arguments—his data about polar ice melting, his narrative of the consequences of rising carbon dioxide levels for civilization—than there was just a few years ago. Senators of both parties seem to now mostly agree that a price on carbon dioxide, most likely through a cap-and-trade system, is inevitable, even coming soon.â€?
Gristmill’s Tom Laskawy: “…as necessary as a robust, functioning cap-and-trade system is to addressing climate change, the opinion among many environmentalists is very much that government regulation, i.e. emissions cuts by decree, holds the key to a low-carbon future. The reason? The emissions cuts are going to have to be really, really, really big and markets, while very good at the trading part, don’t do such a good job with the capping part.

SCHIP, Covering Legal Immigrants, To Pass Senate Today

W. Post: “The Senate is expected to approve a bill today that provides health insurance to about 11 million low-income children … Senate Democrats, after easily defeating Republican attempts to narrow the bill yesterday, predicted they had the votes to renew and expand [SCHIP] … In particular, Republicans objected to a provision in both the House and Senate versions that would, for the first time, lift a five-year waiting period for children of legal immigrants to enroll in the program. ‘This is not the bill we intended,’ bellowed the normally mild-mannered Sen. Pat Roberts (R-Kan.) … ‘Those kids come from low-income families with parents that work hard and pay taxes just like citizens,” countered Senate Finance Committee Chairman Max Baucus (D-Mont.). ‘And, those kids need checkups and prescriptions just like all other CHIP kids.'”

Will Obama Get Stingy, or Bolder?

Yesterday there was news Obama would soon install PAYGO rules that could restrict more bold public investment. Today brings differing indications.
National Review’s Guy Benson reports House conservatives blowing gaskets after Obama told FDR didn’t spend enough, early enough. One member relayed to his area’s radio station: “The president offered a comment in the conference the other day. He said that the spending program that President Roosevelt used in the beginning of the depression — the real problem was that Roosevelt slowed down on public spending in the first two years. If he’d just kept on spending that money, we’d have gotten out of the depression quicker. I think [that’s] an indication of what’s coming.”
WH Press Sec Robert Gibbs also indicated more is coming: “We are not going to be out of the woods after only a certain period of time. There are obviously going to be time periods after that where we’re going to have to continue to do — we’re going to have to continue to make investments in order to continue that economic growth and that job growth. This isn’t a one-time deal. We are going to have to work actively, not just this year, not just next year, but likely the year after that. The stimulus program isn’t going to, in and of itself, solve every problem. We’ve got a lot of work to do, and it’s going to take a long time to get that done.”
Upcoming NYT Magazine offers glimpse at Obama administration thinking:

The economy will recover. It won’t recover anytime soon. It is likely to get significantly worse over the course of 2009, no matter what President Obama and Congress do. And resolving the financial crisis will require both aggressiveness and creativity. In fact, the main lesson from other crises of the past century is that governments tend to err on the side of too much caution — of taking the punch bowl away before the party has truly started up again. “The mistake the United States made during the Depression and the Japanese made during the ‘90s was too much start-stop in their policies,â€? said Timothy Geithner, Obama’s choice for Treasury secretary, when I went to visit him in his transition office a few weeks ago. Japan announced stimulus measures even as it was cutting other government spending. Franklin Roosevelt flirted with fiscal discipline midway through the New Deal, and the country slipped back into decline.
Geithner arguably made a similar miscalculation himself last year as a top Federal Reserve official who was part of a team that allowed Lehman Brothers to fail. But he insisted that the Obama administration had learned history’s lesson. “We’re just not going to make that mistake,â€? Geithner said. “We’re not going to do that. We’ll keep at it until it’s done, whatever it takes.â€?

Progressive Breakfast: Economists Back Economic Recovery

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

House Vote Today

AP: President Barack Obama’s expansive and expensive plan to jump-start the economy is all but certain to clear its first hurdle when the Democratic-controlled House votes on a $825 billion version that melds new spending and tax cuts. Republican support, however, is in doubt when voting takes place Wednesday.”
House bill moves after Obama administration agrees to PAYGO rules following passage. The Hill reports: “House Democrats won a key procedural vote Tuesday on the stimulus after a last-minute promise from the Obama administration to return to ‘pay-as-you-go’ budget rules after the stimulus is approved. In a 224-199 vote, the House approved a resolution allowing the stimulus bill to come to the floor for debate. Twenty-seven Democrats — 24 of them members of the conservative Blue Dog Coalition — bucked their leadership and voted against the measure. But according to Democratic leadership sources, the number was almost much higher — and could have been high enough to hand the Republicans a monumental victory — had it not been for a letter from President Obama’s budget director Peter Orszag … ‘Moving forward, we need to return to the fiscal responsibility and pay-as-you-go budgeting that we had in the 1990’s for all non-emergency measures,’ Orszag continued.”
PAYGO rules would restrict additional deficit spending which by definition is stimulative, but could also produce pressure to quickly repeal Bush tax cuts for the wealthy and close corporate tax loopholes. Question: will anything else be deemed an “emergency”?
Progressive Breakfast
Obama holds firm on tax credits for the poor. W. Post: ” He staunchly defended one of [the Republicans’] least favorite provisions, a $500-per-individual tax credit that can be claimed by people who make too little to pay income taxes but currently pay payroll taxes. Republicans oppose the so-called refundable credits, arguing that they are a form of welfare. ‘Feel free to whack me over the head, because I probably will not compromise on that part,’ Obama said of the refundability portion, according to a GOP participant who took notes during the House meeting. ‘I will watch you on Fox News and feel bad about myself.'”
Senate version totals $888B after $70B provision protecting upper-middle class from Alternative Minimum Tax: “The addition of the AMT provision may increase Republican support in the Senate … but may deepen resistance among more fiscally conservative House Republicans.”

Most Economists, Most Voters Back Economic Recovery

Center for American Progress Action Fund publishes letter in support of economic recovery bill signed by prominent economists from “across the spectrum,” while libertarian CATO publishes NYT ad opposing the plan featuring right-wing economists.
McClatchy settles the score: “…most leading economists who are experienced in public policy generally favor the stimulus plan that the House is considering because through it the government will step up spending at a time when private-sector spending has fallen off sharply. Some economists are ideologically opposed to any such massive government plan. The Cato Institute, a libertarian research center, has organized a list of dozens of academic economists who oppose the plan, urging instead tax cuts and smaller government, in favor of free markets and lower taxes over big government activities … However, that isn’t where the balance of expert opinion comes down today.”
NYT’s David Leonhardt mostly praises: “…for all the criticism the stimulus package has been getting, it does pretty well by several important yardsticks. First of all, the package really is stimulus. It will quickly give money to the people who have been hardest hit by the recession and who, not coincidentally, will be most likely to spend that money soon. The spending also has a chance to do some long-term good, by paying for the computerization of medical records, the weatherization of homes and other such investments … it still is a missed opportunity in a few instances. The biggest is infrastructure … This bill should help the economy in both the near term and the long term. But the government doesn’t go out and spend about $800 billion every day. The details matter.”
Also from NYT: “…House Democrats would create a temporary new entitlement allowing workers getting unemployment checks to qualify for Medicaid, the health program for low-income people [and give] a hefty subsidy to help laid-off workers retain the same health plans they had from their former employers … Democrats said the changes took a major step toward their goal of coverage for all Americans.”
Media Matters: “CNN’s Brown, Velshi falsely claimed increased food stamps and unemployment payments are ‘not stimulus'”
Pollster’s Mark Blumenthal review the polling: “When asked whether they favor or oppose an ‘economic stimulus’ plan that would cost $800 billion or so (give or take a hundred million), Americans generally express support in the mid-50-percent range … When the questions provide more information on how the $800 billion (or so) will be spent, usually specifying a combination of tax cuts and transportation, education and energy projects, support grows to mid-60 low-70 percent range.”
TPM: Support for Obama’s Stimulus Plan, very high. Support for Boehner and McConnell, very low.
W. Post covers concern among some progressive congresspeople that the bill is not big enough: “Administration officials have said they did not push for more infrastructure spending because of concerns about how many projects are ‘shovel ready’ — a view that House members say is held most strongly by Lawrence H. Summers, Obama’s chief economic adviser. Even though most House Democrats say they will back the plan, many reject the administration’s argument, saying that infrastructure projects could easily be expedited, that the economy will need additional infusions for years to come and that the real reason for shunning infrastructure was to make room for tax cuts. Obama, with a public mandate to do something big, is missing a rare opportunity to rebuild the country, they say.”

Bipartisan Kabuki

Digby exposes the “bipartisanship” tactic: “The GOP hissy fit has worked like a charm. The villagers are all on the same page: the ‘problem,’ as always, is that Democrats are not doing everything they are precisely told to do by the Republicans. They are being partisan. The Republicans weeping and wailing like Victorian spinsters works every time.”
Speaker Pelosi explains bipartisanship to the media: “Bipartisanship means giving an opportunity to make their voices heard and maybe to persuade in the marketplace of ideas. It does not mean we will have a continuation of the last eight years of failed economic policies that have taken us where we are today.”

Obama Tries to Extinguish Conservative-Lit Brush Fires

Politico: “Obama and his often stormy Chief of Staff Rahm Emanuel interceded in the House to strike a provision related to the purchase of contraceptives with Medicaid funds. A $200 million appropriation in the House bill to improve the National Mall in Washington was dropped after pressure from Blue Dog fiscal conservatives.”
Time on the GOP strategy: “Sowing the seeds of discontent between Obama and Pelosi is a no-lose proposition for the GOP: If Obama wins they get a bigger seat at the table, and if Pelosi gets her way, it’s a blow to Obama’s promises of inclusiveness and bipartisanship. ‘If he’s willing to kick [the Democratic leaders], we’re willing to applaud, we’ll take it,’ another GOP leadership aide said. ‘Am I trying to stir up trouble between him and his party? Of course I am.'”
Kos slaps Dems: “They never learn”

How Much Biz Tax Cuts?

Politico reports that the Senate Finance Committee added “more tax relief” to its version, but’s Bernie Horn observes, “if the Senate version is adopted, only 3 percent of the spending is for business tax breaks. If the House version is adopted, it’s only 11â?„2 percent. Either way, this is a bill that is between 97 and 98.5 percent targeted toward good causes.”

Business Lobby Won’t Buy American

W. Post’s Harold Meyerson rips the business lobby for opposing “Buy American” provision: “The debate about the stimulus package before Congress has helped expose the huge rift between our national interest and that of our globalized business sector. Last week, the House Appropriations Committee voted almost unanimously to require the use of U.S.-made steel in the infrastructure projects included in the stimulus, unless the U.S. industry — which is running at 43 percent of capacity — was unable to supply it. You might think that American business, beyond the steel industry, would welcome such language, but, in fact, using Americans’ tax dollars to stimulate American production looks like the last thing globalized American business wants. A letter opposing “Buy American” provisions in the stimulus has been signed by the U.S. Chamber of Commerce, the Business Roundtable and several other such groups … The only mystery here is why the Chamber and the Roundtable aren’t compelled to register as foreign lobbyists.”

Transit Watch

Politico reports high-speed rail added in the Senate, but at a cost: “the Senate Appropriations Committee leadership stepped in to dramatically scale back an Obama-backed proposal to devote as much as $2.6 billion for the purchase of new energy-efficient vehicles for the government’s fleet … the vehicle purchases had been cut back to $600 million, with $2 billion instead devoted to high-speed rail corridors. ‘We would have been killed,’ Senate Appropriations Committee Chairman Daniel Inouye (D-Hawaii) told Politico. ‘Someone didn’t think that out very well.'”
Streetsblog: “A spokesman for Jerrold Nadler confirms that the amendment to boost transit funding in the stimulus package has cleared the House Rules Committee. That means the full House will decide whether to add $3 billion in transit investment to the economic recovery bill — a vote that could take place as soon as noon [today]. The most important House member to call now is the one who represents you.”
Transportation for America posts a map, The United States of Transit Cutbacks, showing where 51 transit systems are facing cuts and need federal help.
Civil Engineers Say Infrastructure Needs $2.2T, Five-Year Investment. NYT: “More than a quarter of the nation’s bridges are structurally deficient or functionally obsolete. Leaky pipes lose an estimated seven billion gallons of clean drinking water every day. And aging sewage systems send billions of gallons of untreated wastewater cascading into the nation’s waterways each year. These are among the findings of a report to be released Wednesday by the American Society of Civil Engineers, which assigned an overall D grade to the nation’s infrastructure and estimated that it would take a $2.2 trillion investment from all levels of government over the next five years to bring it into a state of good repair.”

Teach Our Children Well, By Funding It

NYT looks at the very large education piece of the package: “The proposed emergency expenditures on nearly every realm of education, including school renovation, special education, Head Start and grants to needy college students, would amount to the largest increase in federal aid since Washington began to spend significantly on education after World War II.”
NYT catches one troubling provision: “One provision, which was sought by the student lending industry and went unmentioned in early Congressional summaries of the stimulus package, would temporarily increase subsidies to banks in the guaranteed student loan program by tying them to a new index, partly because recent federal intervention in the credit markets has invalidated the previous index. A spokesman for Sallie Mae, one of the largest student lenders, said the change was needed to keep student loan markets fluid. Critics said it represented a potential new windfall for lenders. ‘This just continues the well-established tradition of welfare for the student loan industry,’ said Barmak Nassirian, an expert in student lending.”’s Bill Scher on how while there is less for infrastructure than what Institute for America’s Future proposed, there is much more for education and the unemployed: “Congress is more heavily tilted to addressing the immediate crisis, though that doesn’t mean they are being outright myopic about long-term needs.”

Bailout Recipients Plot Against EFCA

HuffPost scoop with damning audio of takers of government funds seeking to deny bargaining power to workers: Three days after receiving $25 billion in federal bailout funds, Bank of America Corp. hosted a conference call with conservative activists and business officials to organize opposition to the U.S. labor community’s top legislative priority. Participants … including at least one representative from another bailout recipient, AIG — were urged to persuade their clients to send ‘large contributions’ to groups working against the Employee Free Choice Act…”
ITT List’s Art Levine: “While President Obama is said to be looking to put some strings on the second half of the bailout to the banks, his economic team ought to look into limiting their ability to spend taxpayers’ money to lobby for selfish political goals that hurt the American economy.”
AFL-CIO blog flags new Human Rights Watch report on EFCA: “The message of HRW’s report is clear: under existing U.S. law, the freedom to form unions and bargain is a hope, not a reality, for millions of workers. Passing the Employee Free Choice Act will go a long way toward making sure the United States lives up to its obligations to protect workers’ fundamental and internationally recognized right to form a union and bargain for a better life.”

Military Spending Cuts Coming?

WSJ reports: “The biggest U.S. defense companies drastically increased their spending on lobbying last year, in the face of stiffer competition for fewer major Pentagon contracts and ahead of a change in the White House … ‘We must have the courage to make hard choices,’ Mr. Gates told members of the Senate Armed Services Committee … Mr. Gates said many key defense-industry contracts have had big cost and performance problems. As the economy worsens and the president breaks with the previous administration’s national-security policies, the Pentagon’s top civilian will have to make many tough calls this year. ‘One thing we have known for many months is that the spigot of defense spending that opened on 9/11 is closing,’ Mr. Gates said.”

Climate Crisis, Delays, Dodges and Poison Pills

TNR’s Brad Plumer on the NOAA climate study: “Even if we pare emissions back to pre-industrial levels, which would mean phasing out all fossil-fuel emissions and taking carbon out of the air, then some negative effects—rising sea levels, drought—will still occur, with effects lingering for a thousand years. But, as the study notes, pushing atmospheric carbon concentrations up even further, from their current level of 385 parts per million (ppm) to something like 450 to 600 ppm, will exacerbate the situation considerably—further altering rainfall patterns and boosting the likelihood of large Dust Bowl-like conditions in places like the U.S. Southwest and southern Europe, lasting for millennia rather than a decade or two.”
Tom Laskway guesting at Ezra Klein argues this means “the ‘innovation dodge,’ endorsed by ‘reasonable’ conservatives like Andrew Sullivan, and used as a bludgeon against government regulation”
should be DOA. “Before this latest news, it surely seemed safe to base your climate strategy on silver bullets. You just figure you can pull all that nasty carbon out of the air once you’ve invented a magic carbon-eating machine some time in the indefinite future. But now we have evidence that we don’t just have to deal with more carbon if we wait, we have to deal with more and larger guaranteed effects on the climate…”
Grist’s David Roberts warns “Carbon tax is a poison pill”: “The 111th U.S. Congress is not going to pass a carbon tax. Calls for a carbon tax, to the extent they have any effect, will complicate and possibly derail passage of carbon legislation … If you want carbon pricing out of this Congress, cap-and-trade is what you’re getting. It follows that your energies are best spent ensuring that cap-and-trade legislation is as strong as possible … support for carbon taxes has been taken up by a growing cadre on the far right … Are we to believe that these folks understand the threat of climate chaos … and sincerely believe that a carbon tax is the best way to accomplish that goal?”

Progressive Breakfast: Conservatives Delay and Distort While Jobs Vanish

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

Jobs Rapidly Vanishing, Action Needed Now

W. Post assessment of the economy is stark: “The nation’s employers, including some of its largest and most sturdy, announced plans yesterday to slash more than 55,000 jobs, a staggering one-day toll that highlighted how quickly layoffs are accelerating and how widely misery is spreading throughout the labor market.”
Campaign for America’s Future called on its supporters to “Call Congress NOW at 1-866-544-7573, and demand immediate passage of the American Recovery and Reinvestment Act,” because “Conservatives are doing everything they can to delay and dilute the legislation. Yet quick, bold action on the economy is critical if we are to blunt the accelerating job losses of the year-long Bush recession.”
Conservatives are looking to do the same to derail economic recovery. quotes Rep. Michelle Bachmann:“Trust me, they get skittish when their phones start ringing off the hook. We need you to literally melt the phone lines and tell them ‘do not vote for the stimulus plan.'”
The Hill lays out the timing: “House Democrats hurriedly added the economic stimulus bill to a Monday evening Rules Committee meeting in a move designed to allow general debate on the legislation to begin Tuesday … House Democrats altered their strategy, and decided to opt for two separate Rules Committee meetings: One on Monday night to consider the standing bill and one on Tuesday afternoon to consider the rules governing amendments. The House is still scheduled to vote on final passage of the bill Wednesday night. Until the Tuesday Rules Committee meeting, it will be uncertain how many amendments will be allowed to be debated on the floor.”’s David Sirota urges Dems to go bold on The Rachel Maddow Show last night: {font-size:11px; font-family:Arial, Helvetica, sans-serif; color: #999; margin-top: 5px; background: transparent; text-align: center; width: 425px;} .msnbcLinks a {text-decoration:none !important; border-bottom: 1px dotted #999 !important; font-weight:normal !important; height: 13px;} .msnbcLinks a:link, .msnbcLinks a:visited {color: #5799db !important;} .msnbcLinks a:hover, .msnbcLinks a:active {color:#CC0000 !important;}

Actual Anti-Poverty Action

CBPP gives the edge to the House over Senate in reducing poverty: “The House recovery plan contains a number of poverty-reducing provisions, three of which — a new “Making Work Payâ€? tax credit and proposals to expand the Child Tax Credit and the Earned Income Tax Credit — would keep out of poverty about 1.1 million children who otherwise would be poor. Counting adults as well, these temporary tax provisions would keep a total of more than 2.5 million Americans out of poverty. The Senate’s similar but somewhat weaker set of provisions would keep more than 800,000 children out of poverty, about a quarter million fewer than the House bill but still a substantial number.”

Ban on Pork(-sounding) Products

ProPublica reports that the House bill includes a clause that “prohibits stimulus funding ‘for any casino or other gambling establishment, aquarium, zoo, golf course, or swimming pool.'”
D-Day no likey: “This is only in there to rebut conservative arguments about “wasted” stimulus money, but it’s absurd. Someone has to build that aquarium or zoo or golf course. That person gets a job, and spending money …jobs that are more long-term and that multiply solutions by leaving something tangible behind or contribute to, say, reducing greenhouse gases are more desirable. But eliminating projects that may be shovel-ready because of PR concerns is just bad sausage-making.”
AP reports on family planning funds: “House Democrats are likely to jettison family planning funds for the low-income from an $825 billion economic stimulus bill, officials said late Monday, following a personal appeal from President Barack Obama at a time the administration is courting Republican critics of the legislation.” TPM’s Elana Schor reports: “Republicans Irate Over Expansion of Republican-Approved Program.”

Transit Setback in the House

Streetsblog via Transportation from America reports that Rep. DeFazio’s $2B transit amendment “was required to be withdrawn … something to do with parliamentary issues.” But, “Now the best hope for getting more funding for transit is Rep. Jerry Nadler’s amendment, which would add $3 billion for transit to the stimulus bill. T4A suggests calling the offices of House Speaker Nancy Pelosi (202-225-0100) and House Appropriations Committee Chair David Obey (202-225-3365) to say Nadler’s amendment must make it to the House floor.”

A Real CBO Report!

Time’s Jay Newton-Small: “Overall the CBO estimates that more than two-thirds, 64%, of the bill will be disbursed into the economy over the next 18 months … more in line with the 75% OMB director Peter Orszag said would be spent over then next 18 months in a letter to Congress. But in looking at discretionary spending – the three-page portion that was leaked to the press, myself included, last week — things look very similar. Only 41% — up from the 38% in last week’s version – of these funds, which involve the bulk of the infrastructure spending, will make it into the economy by the end of fiscal 2010, or $145 billion out of $356 billion. The stagnancy of these numbers shows that the CBO didn’t redefine ‘shovel ready,’ and their definition is based on a narrow historical view as Scott Lilly explains.
Beat the Press’ Dean Baker: “It will be interesting to see if the Republicans are as anxious to use these CBO numbers as they were of the numbers in the preliminary report. It will also be interesting to see if all the media outlets who highlighted the preliminary analysis give the same prominence to CBO’s actual report.”
Angry Bear’s Bruce Webb goes deep into the numbers (via Economic Populist): “…if the premise is that the bill is simply laden up with spending on condoms and that too little is targeted at spending that will provide real stimulus, well that just doesn’t survive encounter with the numbers. Near as I can see the spending is projected to be converted into infrastructure and hence jobs in about as fast as practicality allows. Where they can spend quick (schools, military bases, housing) they spend quick, where the nature of the project requires extended build out (clean energy, water projects, clean water, highways, mass transit) they project that it will be spent as fast as reasonably possible.”

More Bad Conservative Ideas

CBPP rips Boehner-Cantor tax plan: “A House Republican proposal to cut income tax rates would provide its largest benefit to the top fifth of households and prove less effective as economic stimulus than the provision it would replace –President Obama’s ‘Making Work Pay’ tax credit.”
NYT’s Bob Herbert incredulous at the state of the GOP: “The Republican answer to this turmoil? Tax cuts. They need to go into rehab. The question that I would like answered is why anyone listens to this crowd anymore. G.O.P. policies have been an absolute backbreaker for the middle class … The G.O.P. has successfully engineered a wholesale redistribution of wealth to those already at the top of the income ladder and then, in a remarkable display of chutzpah, dared anyone to talk about class warfare … When the G.O.P. talks, nobody should listen.”
Obama will listen congressional GOPers today, though one Dem “leadership” aide tells The Hill: “The issue here is that the legislation is moving and Republicans have a choice to make: work in a bipartisan way to see this legislation become law or continue to advocate for policies of the past that have resulted in millions of jobs lost and the American economy in crisis.â€?

More Conservative Lies

Politifact rips House Republican Whip Eric Cantor for “Pants on Fire” lie: “In an interview with Fox News on Jan. 23, 2009, Rep. Eric Cantor … said that in a meeting with President Obama, Cantor asked if he ‘could use his influence on this process to try and get the pork barrel spending out of the bill. I mean, there’s $300,000 for a sculpture garden in Miami.’ But do a word search on ‘sculpture’ in the 647-page stimulus bill now before the House and you’ll come up blank. That’s because it’s not in there.”
Media Matters gets Lou Dobbs angrier than usual after treating the selective leaking from the CBO as a complete report: “On the January 26 edition of CNN’s Lou Dobbs Tonight, host Lou Dobbs falsely claimed that in a previous item criticizing White House correspondent Ed Henry’s January 23 report on President Obama’s economic recovery package, Media Matters for America ‘tr[ied] to conflate the Office of Management and Budget [OMB] numbers as somehow superior with the Congressional Budget Office [CBO],’ which he asserted ‘is an absurdity.’ Media Matters did no such thing, merely pointing out that according to OMB director Peter Orszag, the CBO conducted only a partial analysis of the bill.”
Also last night, Dobbs’ reporter Ines Ferre relies on right-wing Citizens Against Government Waste to levy unchallenged false attacks against the economic recovery. FLASHBACK: Exposing the hackery behind Citizens Against Government Waste.
Wonk Room: “Conservatives Peddle Myth That Stimulus Spends $275,000 For Every Job Created”
Heritage’s Conn Carroll tries to claim the since Obama econ aide Larry Summers supported a “timely, targeted and temporary” strategy for early 2008 stimulus, his current support for a bolder plan is hollow. That ignores Summers changing his view in November because “the situation has deteriorated very substantially” and now a “speedy, substantial and sustained [plan] over a several-year interval” is necessary.

Health Care This Year?

D-Day: “So I guess Jim Clyburn, the House Majority Whip, would rather go slow with an incremental approach to health care reform … [Health Care for America Now!] is asking South Carolinians to call Clyburn and urge him to reconsider his comments. His DC office is at (202) 225-3315.”
The Hill has Speaker Pelosi with a different message: “A spokesman for Speaker Nancy Pelosi (D-Calif.) predicted Monday that the House would “take a major stepâ€? toward comprehensive health reform this year, a comment that appears to contrast with a member of her leadership team.”

Can Dems Unify to Deal With Global Warming?

Marc Ambinder speculates on timing of global warming legislation: “The House will move the bill; Rep. Henry Waxman intends to get it out of his committee by Memorial Day … But action in the Senate will be stalled for a while. Some powerful senators aren’t sold that it’s the best thing to do quickly. And the Obama administration does not seem to be inclined to pursue cap-and-trade over comprehensive health care reform during this time of crisis.”
NYT looks at geographic divisions within the Dem caucus, ending on how the gap can/will be bridged: “‘Every single wind turbine takes 26 tons of steel to construct,’ [Rep. Ed] Markey said. ‘A lot of new jobs will be created if we craft a piece of global warming legislation correctly, and that is our intention.'”
Meanwhile, the urgency to address climate change is even clearer. Climate Progress reports: “NOAA stunner: Climate change ‘largely irreversible for 1000 years,’ with permanent Dust Bowls in Southwest and around the globe … gives the lie to the notion that it is a moral choice not to do everything humanly possible to prevent this tragedy, a lie to the notion that we can ‘adapt’ to climate change, unless by ‘adapt’ you mean ‘force the next 50 generations to endure endless misery because we were too damn greedy to give up 0.1% of our GDP each year.'”

EFCA Watch

TPM’s Matt Cooper sizes up the EFCA landscape: “Thus far, EFCA opponents have won the battle for elite opinion … I suspect few folks really know about it but in general the public is in a pro-union mood … Labor officials now believe that the bill will come up in the Spring, perhaps May or June, and that the administration and the president will indeed fight for it. While the White House has been somewhat chastened by the vigorous campaign against the bill, with some officials privately fearing that it could be their ‘gays in the military,’ the president, labor leaders believe, is committed to pushing forward with his support of EFCA and hopes to sign it into law this year.”
AFL-CIO Blog: Sen.-Designate Gillibrand Supports Employee Free Choice Act

Progressive Breakfast: Who Won In November?

Progressive Breakfast is created for, and is the morning roundup of what progressive movement members need to know to start the day.

Dems Stand Firm On Econ Recovery, GOP Opposition Hardens

On NBC’s Meet The Press, Obama econ advisor Larry Summers addresses criticism that too little will be spent quickly, noting most will be spent quickly, but long-term investments are crucial too:

The president has committed, through a letter from his [budget] director, Peter Orszag, that three-quarters of this $825 billion program will be spent out within the first 18 months. … we’re not going to rush things to the point of being wasteful. But the tax measures are going to change withholding checks within weeks after they’re enacted. Cities across the country are going to see help so they don’t have to lay off teachers or cops within weeks after the program is passed.
So yes, speed is a crucial concern. But you know, David, there is something else we have to recognize, which is these problems weren’t made in a day or a week or a month or even a year, and they’re not going to get solved that fast. So even as we move to be as rapid as we can in jolting the economy and giving it the push forward it needs, we also have to be mindful of having the right kind of plan that will carry us forward over time. That’s why the productive aspects of the investments the president’s making–doubling renewable energy, for example, modernizing 10,000 schools–are so essential.

Angry Bear’s Bruce Webb reminds that many New Deal public works investments helped win WWII in the following decade, and are still with us today.
Summers on claims from the W. Post editorial board that money for police and education don’t help the economy:

…respectfully I would disagree with The Washington Post. There are cops being laid off across the country. Saving their jobs is saving jobs, it’s helping the economy, it’s protecting our neighborhoods.
I used to be a college president. There are kids across the country who are losing the chance to go to college, whose families are being forced to put their houses on the market to help those kids go to college, further putting downwards pressure on the economy.
I think spending to respond to the extra burdens on financial aid, putting money into the economy for financial aid for college students is a good investment, just like saving the jobs of cops is a good investment.

Summers on repealing the Bush tax cuts: “I don’t think there’s any question they have to be repealed. The country can’t afford them for the long run … the question of timing is one we’re going to have to reach as we see how the economy unfolds, as Congress reaches its judgments. But they’re not going to be with us for long.”
On ABC’s This Week, Speaker Nancy Pelosi dismissed House Minority Leader John Boehner’s attempt to mock funding for family planning services:

STEPHANOPOULOS: Hundreds of millions of dollars to expand family planning services. How is that stimulus?
PELOSI: Well, the family planning services reduce cost. They reduce cost. The states are in terrible fiscal budget crises now and part of what we do for children’s health, education and some of those elements are to help the states meet their financial needs. One of those – one of the initiatives you mentioned, the contraception, will reduce costs to the states and to the federal government.
STEPHANOPOULOS: So no apologies for that?
PELOSI: No apologies.

Republican opposition hardened on the Sunday shows, fueled by what D-Day deemed a “Misinformation Brigade”
FireDogLake posts video of Paul Krugman politely slamming Sam Donaldson for carrying the false conservative talking point that Obama adviser Christina Romer previously wrote a paper undermining the rationale from the econ recovery bill.

The Non-existent CBO Report

Conservatives claimed a CBO report proved the American Recovery and Reinvestment would only spend 38% of its funding in the next two years. Turns out, the report doesn’t exist.
Huffington Post’s Ryan Grim has the scoop:

Reports of a recent study by the Congressional Budget Office, showing that the vast majority of the money in the stimulus package won’t be spent until after 2010, have Democrats on the defensive and the GOP calling for a pullback in wasteful spending.
Funny thing is, there is no such report.
“We did not issue any report, any analysis or any study,” a CBO aide told the Huffington Post.
Rather, the nonpartisan CBO ran a small portion of an earlier version of the stimulus plan through a computer program that uses a standard formula to determine a score — how quickly money will be spent. The score only dealt with the part of the stimulus headed for the Appropriations Committee and left out the parts bound for the Ways and Means or Energy and Commerce Committee.
Because it dealt with just a part of the stimulus, it estimated the spending rate for only about $300 billion of the $825 billion plan. Significant changes have been made to the part of the bill the CBO looked at.
The CBO numbers were given to a small number of congressional Democrats and Republicans, but were not posted online because they’re not an official CBO product … Democratic aides say they are certain that the GOP leaked it to the Associated Press in order to undercut the spending portion of the stimulus.’s Isaiah Poole: “…we have the answer to the question I posed about whether the CBO is being used by House conservative obstructionists to derail the Obama stimulus package. The answer is a resounding yes, in a most dishonest way.”
OpenLeft’s Paul Rosenberg: “CBO hadn’t released a public report, but it had released some estimates to a handful of senators. Those estimates were highly questionable on their face, and good reporters should have questioned them immediately. Moreover, CBO should never have issued them as they were. …only a few scattered Democratic voices seriously questioned the core of the CBO numbers–and those numbers are highly questionable on their face.”
Beat The Press’ Dean Baker: “Washington Post Still Touts Non-Existant CBO Report on Stimulus”
Crooks and Liars: “[Rep]. Bilbray Cites Nonexistent CBO Report as Excuse to Oppose Stimulus Package”

Econ Package Invests Long-Term

HuffPost’s Robert Kuttner praises the econ recovery plan for investing long-term: “If you look at the details of the Obama recovery plan, however, it includes a lot of outlays that don’t look like one-shots: laying more than 3,000 miles of electric transmission lines; installing 40 million “smart” utility meters to help reduce energy use; weatherizing 2 million homes and most federal buildings. Among the other infrastructure investments are improving security at 90 major ports and modernizing the nation’s water system. These needs and others like them don’t end after two years … Sounds good to me, but he will face ideological qualms from the fiscal conservatives within his own party, as well as from most Republicans. So the bipartisan honeymoon is unlikely to last, and I’d say, good riddance.”
ClimateProgress praises energy-efficiency measure: “The single most important policy change needed to promote broad-based, California-style energy efficiency is to ‘decouple’ utility profits from sales, to allow utilities to profit from energy efficiency … I have been assuming that Democrats would wait until the mother of all energy bills later this year to make their big push toward decoupling. But it turns out that Dems have decided to make it one of the conditions for the multi-billion-dollar energy efficiency block grants in the stimulus”

Push For More Infrastructure, Less Biz Tax Breaks

Friday night, Rep. Peter Defazio took to The Rachel Maddow Show to press Obama and Congress from the left, demanding more infrastructure investment: {font-size:11px; font-family:Arial, Helvetica, sans-serif; color: #999; margin-top: 5px; background: transparent; text-align: center; width: 425px;} .msnbcLinks a {text-decoration:none !important; border-bottom: 1px dotted #999 !important; font-weight:normal !important; height: 13px;} .msnbcLinks a:link, .msnbcLinks a:visited {color: #5799db !important;} .msnbcLinks a:hover, .msnbcLinks a:active {color:#CC0000 !important;}

McClatchy reports that Sen. Max Baucus’ version includes more corporate tax breaks, as well as, more clean energy tax incentives than the House version.
D-Day: “The reason you want lots of infrastructure spending in the stimulus is because it can both be spent quickly and leave something behind afterwards. That’s true of the health care and energy spending as well, but that’s not what infrastructure spending appears to be competing with. It’s competing with business tax breaks that do not provide nearly the kind of ‘bang for your buck’ that can multiply the effect of fiscal spending. These Chamber-of-Commerce-friendly provisions being put in the Senate package, for example, are appalling.”
FDL’s Stirling Newberry previews the House floor debate: “One [amendment] from DeFazio, a key member of Transportation, would restore 2 billion of the 23 billion shorn away from the bill since it was introduced. Jerry Nadler has asked for a direct meeting with Obama to increase the size and spending scale of the bill, and to green it’s provisions, arguing the bill is too small by standard measures, and that more money could be spent effectively.”
<a href="'s Chris Bowers on the rail amendment: "This amendment is going to go through the House Rules Committee in order to make it to the floor. With a vote on the stimulus expected on Wednesday, amendments need to be clear of committee by Tuesday. I am thinking that this might be a good piece of activism for us to jump on tomorrow and Tuesday: call members of the House rules committee to help push the DeFazio amendment onto the floor."
More Small biz tax cuts? W. Post reports on Obama’s talks with House GOPers: “[Rep. Eric] Cantor presented Obama with an alternative GOP plan that included a reduction in marginal tax rates and no increased domestic spending that would result in higher deficits. Afterward, Cantor said the president rejected most of those ideas but remained open to increasing benefits for small businesses that, according to Republican calculations, would receive $41 billion in tax relief under the Democratic plan. Republicans are proposing a 20 percent rate cut in taxes on businesses with fewer than 500 employees.”
Economic Populist’s Robert Oak says scientific research funds, “should be tied to hiring/using U.S. citizens, Americans, perm residents preferred” to better impact the U.S. economy.
African American Political Pundit worries that new construction jobs won’t reach African-Americans without additional “workforce education programs, apprenticeship programs, and first source hiring policies that will benefit low-income communities of color.”

Mortgage Modification Taken Off Table?

OpenLeft’s Chris Bowers: “Senator Durbin has confirmed that President Obama opposes including the measure in the stimulus, and favors including it in later legislation instead … Further, with ten Senate Democrats opposed to the measure last year, we can also expect a big fight over the measure when the home foreclosure mitigation bill comes up later this year.”
Wonk Room: “This provision would allow bankruptcy judges to modify — or ‘cram down’ — mortgages payments “for homeowners who owe more than their home is worth.â€? Currently, bankruptcy judges are not able to modify loans on a primary residence (but can modify loans on second-home mortgages). Giving judges this power is critical to addressing the housing crisis, and should be included in the stimulus package … speeding mortgage modification has a stimulative effect, thus meriting its inclusion in the stimulus bill.”

Conservative Carping Continues

The conservative wishful-thinking counter-narrative is forming. National Review’s Yuval Levin: “It’s simply seen by the Democratic leadership as an opportunity to spend a lot of money on various causes they’ve wanted to support for years and to increase the reach of the government into the economy … At some point, and possibly soon, some significant chunk of the public will wake up to the essential recklessness of our government’s reaction to this financial crisis, and to the failure of technocratic expertise made evident by both the crisis itself and the response to it.”
NYT’s Paul Krugman takes conservatives to task: “…there’s the bogus talking point that the Obama plan will cost $275,000 per job created … write off anyone who asserts that it’s always better to cut taxes than to increase government spending because taxpayers, not bureaucrats, are the best judges of how to spend their money … ignore anyone who tries to make something of the fact that the new administration’s chief economic adviser has in the past favored monetary policy over fiscal policy as a response to recessions.”
ThinkProgress: “McCain Slams Broadband Expansion Idea After Campaigning For It”

Obama Allows States To Slash Auto Emissions

NYT: “Mr. Obama’s presidential memorandum will order the Environmental Protection Agency to reconsider the Bush administration’s past rejection of the California application. While it stops short of flatly ordering the Bush decision reversed, the agency’s regulators are now widely expected to do so after completing a formal review process. Once they act, automobile manufacturers will quickly have to retool to begin producing and selling cars and trucks that get higher mileage than the national standard, and on a faster phase-in schedule … Automotive emissions account for more than one-fifth of all such greenhouse gases.”
W. Post: “Obama will instruct the Environmental Protection Agency to reconsider whether to grant California a waiver to regulate automobile tailpipe emissions linked to global warming, sources said, and he will order the Transportation Department to issue guidelines that will ensure that the nation’s auto fleet reaches an average fuel efficiency of 35 miles per gallon by 2020, if not earlier.”
Grist’s Kate Sheppard has Sen. Boxer’s statement: “When the waiver is signed, it will be a signal to Detroit that a huge market awaits them if they do the right thing and produce the cleanest, most efficient vehicles possible.”

America Needs More Unions

Robert Reich makes the case for EFCA in the LA Times: “Although America and its economy need unions, it’s become nearly impossible for employees to form one. The Hart poll I cited tells us that 57 million workers would want to be in a union if they could have one. But those who try to form a union, according to researchers at MIT, have only about a 1 in 5 chance of successfully doing so.”

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