MORNING MESSAGE: The State of the Union Stakes
OurFuture.org's Robert Borosage: "...the president has little choice but to focus on the central challenge now facing the country – and his emerging progressive coalition today. That is the same challenge that drove the original progressive movement – an economy scarred by extreme and corrupting inequality that works only for the few and not the many. This is, as the president put it in his speech at Osawatomie, Kansas, the make or break moment for the middle class – and for all those who aspire to join it ... Will the president lay out a bold new foundation for growth – and challenge the failed ideologues, entrenched interests and partisan posturing that stands in the way?"
SOTU Faces Sequester, Economy
"Obama Economy Mission Unfulfilled" says Bloomberg before SOTU: "When Obama delivers his State of the Union address tonight, he’ll still be confronting the central challenge of his presidency: The unemployment rate is only a few tenths of a percentage point lower than it was in February 2009, middle- income Americans are earning less, and the economy stalled in the last three months of 2012."
Obama to make the case against sequester in SOTU. The Hill: "He will use the prime-time TV address to argue the economy would be damaged if $85 billion in automatic spending cuts were to go ahead on schedule on March 1, and will seek to set up Republicans to take the blame if they do."
ObamaCare already working to reduce deficit. NYT: "...the Congressional Budget Office said it had erased hundreds of billions of dollars in projected spending on Medicare and Medicaid ... overall health care spending growth [is] continuing at the lowest rate in decades for a fourth consecutive year ... Many of the changes predate the 2010 health care overhaul, but the law has also contributed to the changes by offering some financial incentives, health care experts say ... Remaining on a lower cost trajectory would reduce the pressure on Democrats and Republicans seeking to put the country on a sounder fiscal path."
Obama suggests not much more deficit reduction is needed. W. Post: "In recent weeks, the White House has pressed the message that, if policymakers can agree on a strategy for replacing across-the-board spending cuts set to hit next month, Obama will pretty much have achieved what he has called 'our ultimate goal' of halting the rapid rise in government borrowing ... By the administration’s math, Washington needs to enact only $1.5 trillion more in 10-year savings to hit the $4 trillion target ... Deficit hawks have reacted with alarm to the administration’s position."
Sequester would lead to 1 million furloughed federal workers. W. Post's Joe Davidson: "...with the Pentagon saying that 800,000 employees in the Defense Department alone could be furloughed, expect the government-wide total to well exceed 1 million ... The Federal Aviation Administration, for example, would not be able to move funding from custodial work to avoid furloughing air traffic controllers ... Law enforcement personnel would take a hit like everyone else ... Nearly 1,000 fewer National Science Foundation research grants and awards would lead to 12,000 scientists and students curtailing scientific research..."
Pelosi asks Boehner to cancel congressional recess to work on averting sequester reports Roll Call.
Stan Collender argues for simply canceling the sequester: "Not only would this be politically feasible, it also would be the right fiscal policy at this moment. With businesses and consumers not spending, trade not helping and state and local governments still cutting back, it makes no economic sense right now for the federal government to be reducing its contribution to GDP by cutting spending." CLICK HERE to tell Congress: Repeal the Sequester.
SOTU May Tout Executive Orders
Obama may preview executive action on climate. The Hill: "At the very top of advocates’ wish list is a commitment to setting carbon emissions standards for existing coal-fired power plants. A move in that direction would begin an all-out war with coal-based power companies and some other industry sectors that say there would be huge economic costs from increased regulation. Obama, without Congress, can also expand on his first-term actions to boost Defense Department green energy programs and development alternative energy on public lands, among other steps. No matter what steps Obama takes, environmentalists say the president needs to use the bully pulpit to rally public support."
President should take executive action on trade, argues EPI's Robert Scott: "Under existing authority, the President can execute one simple policy that would create 2.2 to 4.7 million jobs over the next three years: End currency manipulation by a handful of countries, especially China. This policy would boost GDP, reduce unemployment and, in budgetary terms cost nothing. It would, in fact, substantially reduce the federal deficit. No other policy could achieve this jobs trifecta."
2012 SOTU Mortgage Task Force Faces Criticism
Last year's SOTU mortgage fraud task force, led by NY AG Eric Schneiderman, seen by progressives as disappointment. HuffPost: "'I think Schneiderman is an honorable and a strong advocate, so I think he's been enormously frustrated by the barriers put up around him, when clearly this was a policy driven by a Justice Department that wanted to prop up the banks and an attorney general that doesn't have a pulse,' said Robert Borosage of the liberal group Campaign for America's Future, who argued at the time of the settlement that the success of the unit would determine how smart a bargain it had been for progressives."
Politico reports friction between Schneiderman and Justice: "New York Attorney General Eric Schneiderman, one of the co-chairs, got so fed up with Justice that he went directly to the White House last summer to plead for more investigators, according to two sources with knowledge of the matter ... Before Schneiderman pressed the White House to intervene, the task force had filed zero lawsuits. Since then, the SEC has reached settlements totaling about $400 million with JPMorgan Chase and Credit Suisse, actions that were announced by the SEC under the umbrella of the working group. There are three RMBS Working Group actions pending, including additional lawsuits against Credit Suisse and JPMorgan Chase."
