The daily Progressive Breakfast serves up what progressive movement members need to know to start their day.
Financial Crisis Inquiry Commission Grills Banks Today
OurFuture.org's Les Leopold profiles the witnesses: "Lloyd 'doing God’s work' Blankfein ... Jamie “Obama loves me” Dimon ... John “we cannot control ourselves” Mack ... Brian "baby face" Moynihan."
Call-In Blitz To Defeat Insurance Tax
AFL-CIO leads "National Call-In Blitz" today: "Call 1-877-3-AFLCIO (1-877-323-5246) toll-free and urge your representative to support working families by voting for health care reform that: Does NOT tax our health care benefits; Requires employers to pay their fair share; and Reduces health care costs—the best way to do this is with a public health insurance option."
Anonymous Dems tell AP millionaires tax is dead, employer mandate likely dropped, compromise expected on insurance tax and healthcare exchange: "Negotiators are considering extending the Medicare payroll tax, which now applies only to income from wages, to cover some of the investment earnings of couples making more than $250,000 a year [and] make up lost revenue from dropping the high-wage income tax and scaling back a proposed tax on high-value insurance plans ... negotiators are discussing a hybrid of a proposed national insurance exchange contained in the House bill and the state-by-state approach favored by the Senate ... Obama has indicated support for a national version of the exchange ... some union officials are concerned about any [insurance tax] compromise that would appear to give unions special treatment. They want a fix that protects both union and nonunion middle-class workers from paying higher taxes on health plans."
Politico report finds House Dems still fighting insurance tax, but suffering perceived lack of leverage: "...a wave of rank-and-file House Democrats assailed the Senate's tax on high-end health care plans Tuesday night, on the eve of a critical White House meeting with the president ... underlying the complaints is the perception that, despite all the tough talk, most of these lawmakers will back the final bill. And that sense undercuts the leverage liberal Democrats hope to muster for these final negotiations."
Rep. Charlie Rangel comfortable with expanding the Medicare payroll tax: "It’s comparable to the surtax."
Federal workers organize against insurance tax: "A coalition of federal and postal employees, numbering nearly nine million members, sent a letter to congressional leaders on Tuesday insisting that the final health care bill not include an excise tax on high-end insurance plans."
HCAN quotes Rep. Garamendi's criticism of Senate state-by-state exchange plan: "Under health reform, 30 million people will buy their insurance through the Exchanges. I spent years as insurance commissioner in California, chasing after the insurance company scoundrels. You're going to toss 30 million Americans to these sharks unless there is a real strong regulatory environment [like the House's Exchanges] and public option."
Rep. Rangel suggests than 218 in the House is just as hard as 60 in the Senate to HuffPost.
CQ explains that Pelosi will likely need to flip some Dem "No" votes to get back to 218: "...since [the Nov. vote on the House bill], one 'yes' voter — Robert Wexler, D-Fla. — has resigned to run a nonprofit group. His successor will not be elected until April. Another vote Pelosi cannot count on the next time around came from [Republican] Anh “Joseph” Cao of Louisiana ... Cao says he will oppose the final legislation unless it includes curbs on federal funding for abortion like the language added to the House bill ... Stupak may be Pelosi’s biggest problem, as he claims that at least 10 and as many as a dozen of his allies who voted for the House bill after his amendment was adopted will oppose the final version unless they like its abortion provision ... Where will Pelosi, D-Calif., find that new support? The 39 Democrats who voted against the House bill in November include some obvious targets for conversion, starting with three retiring lawmakers and 11 senior Democrats whose re-election prospects are rated 'safe' by CQ Politics."
W. Post reports final deal not expected until early next month: "...lawmakers say they are unlikely to wrap up their work on health care before early February, a prospect that has complicated Obama's plans for delivering his first State of the Union address and his second budget request. So far, a date for the president's speech, normally delivered in late January, has not been set. And key lawmakers have been told that the president's budget, due on the Hill by Feb. 1, could be delayed."
Drew Westen warns the insurance tax is politically deadly: "It's drawing fire from the center. And if Democrats enact this new tax on working and middle class Americans, they will spend years once again on the outside looking in."
Under the Influence scoops that insurers funded attack ads while claiming to be supportive of reform efforts. "...between $10 million and $20 million, came from Aetna, Cigna, Humana, Kaiser Foundation Health Plans, UnitedHealth Group and Wellpoint, according to two health care lobbyists familiar with the transactions ... The funds were solicited by AHIP and funneled to the U.S. Chamber of Commerce to help underwrite tens of millions of dollars of television ads by two business coalitions set up and subsidized by the chamber."
Kaiser insists to Politico it was not involved: "Kaiser Permanente clearly doesn't want any negative blowback as the president and lawmakers negotiate the final bill."
White House blog says report proves bill will get tough on insurers: "A new report today confirms one of Washington's worst-kept secrets – that big insurance companies are fighting tooth and nail to kill health reform that will wrest power from their hands and give it to American families ... reform will end insurance industry practices like denying coverage based on preexisting conditions, capping total benefits, and dropping coverage when you get sick and need it most."
Bank Fee Announcement Tomorrow
Politico, citing unnamed WH official, details of proposed bank fee to recoup TARP costs: "President Obama will announce tomorrow that his upcoming budget will include a fee on more than 20 of the nation’s largest banks and other financial companies, based on the amount of leverage or liability that the firm has. The aim is to recoup the taxpayer cost of TARP, which is now expected to be less than $100 billion. This is designed to address the complaint that these firms got really cheap money and then continued past risky practices, with an implied guarantee. The administration settled on this fee, to be spread over as many as 10 years, because it applies to more exotic products and won’t be passed along to retail customers."
AP adds: "The 2008 law that created the Troubled Asset Relief Program requires the president to seek a way to recoup unrecovered TARP money from financial institutions, but five years after the law was enacted. It does not specify how the money should be recovered. On Tuesday, the official said Obama's economic team decided it was necessary to recover taxpayer losses more quickly than the law required ... The administration's plan raises a series of questions ... How will the fee be assessed? Administration officials already have ruled out a fee on financial transactions. Also, will banks be required to pay for the billions of dollars in assistance the federal government gave General Motors, Chrysler LLC and AIG?"
Republicans will have difficulty opposing bank fee reports Bloomberg: "Top House Democrats said the president has a winning issue ... Representative David Camp ... said while he and other Republicans find bonuses being paid by banks that got bailouts “irresponsible” and “outrageous,” they are concerned that taxing banks will hurt lending, and thus job creation. Still, he said, the proposal puts Republicans in a box. 'We’re in the political season ... it’s going to be a tough bill politically to oppose.'"
Tapped's Tim Fernholz cautions against framing the proposal in political terms: "Staffers have been working on this tax for months now because the TARP statute requires the government to recoup any losses from the banks themselves. This began long before everyone started gearing up for the next cycle of bonus madness as an obviously needed response to the bank bailouts. It's not getting reported that way because it doesn't fit an easy narrative."
Bank Lobby Bemoans The ‘Absurd’ ‘Perplexing’ ‘Burden’ Of Obama’s Proposed Bank Fee reports Wonk Room
NYT airs banker complaints that there are too many proposals targeting them: "Industry experts, and even some government officials, say some of the plans being floated are at odds with one another or with policy goals like encouraging banks to make more loans."
NYT edit board still wants tax on bonuses: "President Obama and Congress should also impose a windfall tax on the huge bonuses that bailed-out bankers plan to pay themselves over the next few weeks. ... A levy on these financial giants would help by putting a brake on this consolidation — making the largest banks somewhat less profitable and steering investment and other resources into smaller banks, which, if they failed, wouldn’t take the rest of us with them."
Federal Reserve made a profit in 2009. LAT: "The Federal Reserve reported a side benefit to its massive intervention into the financial system -- a record profit of $46.1 billion last year on the central bank's investments. But experts said that gain, which will be paid to the U.S. Treasury, could be offset by losses in the future when the central bank starts selling the Treasury bonds and other assets it has purchased in unprecedented amounts to try to stabilize the economy."
NY Fed to face congressional subpoena for AIG emails: "In response to the accusation by Representative Darrell Issa, the ranking Republican member of the House Oversight and Government Reform Committee, the chairman of the committee said that he would subpoena the New York Fed for the documents that it did not want released. Those documents were collected last year for a government audit of how $30 billion of taxpayer money wound up with A.I.G.’s trading partners. Last week, e-mail messages emerged showing how the New York Fed had recommended that A.I.G. not disclose certain information in regulatory filings. The Fed has said it had valid reasons and merely deleted irrelevant information. It said the New York Fed president at the time, Timothy F. Geithner, was not involved. Separately, Mr. Geithner’s telephone logs raised questions about that statement."
Hope For Consumer Financial Protection Agency Persists
HuffPost reports things are looking up for a consumer financial protection agency: "The fight in the Senate Banking Committee over the creation of a new agency dedicated to consumer financial protection has shifted from whether it should be created to what it will look like. That's a victory for consumer advocates, labor unions and the coalition of progressive groups fighting Wall Street over the shape of reform, but the banks still have several chances to ambush the proposed Consumer Financial Protection Agency as it moves through the Senate ... Heather Booth, head of Americans for Financial Reform, said her coalition has agreed on the elements of what will constitute a strong CFPA. 'We are fighting for an independent agency that has rule-making and enforcement authority, with an independently appointed head, with an independent budget, and that there are no exclusions, so that everybody is included -- auto dealers, pawnbrokers -- everybody,' she told HuffPost."
Top regulator criticizes exemption in House bill. Bloomberg: "'Big Wall Street banks' benefit from a provision in derivatives legislation that has been promoted as aid for companies hedging their own risks, Commodity Futures Trading Commission Chairman Gary Gensler said ... The [House] measure would exempt from many of the rules so-called corporate end-users, businesses such as oil companies and airlines that use derivatives to hedge operational risks ... Such provisions risk leaving as many as 60 percent of standard contracts 'in the opaque, bilateral over-the-counter markets,' Gensler said. He said 'all transactions in standard contracts should be required to be conducted on regulated trading facilities or exchanges.'"
Timing for Senate bill murky. Politico: "...Sen. Chris Dodd (D-Conn.) says he’d still like to get a financial reform bill ready for committee consideration by the end of the month. Not many people following the issue believe that’s realistic."
Lack Of Support For Deficit Commission Prompts Compromise Talks
NYT reports on resistance to an anti-Social Security/Medicare deficit commission: "Vice President Joseph R. Biden Jr. will begin talks this week with leading lawmakers about creating a bipartisan budget commission ... The aim is to reach an agreement that could be a fallback if, as many expect, the Senate next Wednesday rejects a commission proposal from Senators Kent Conrad of North Dakota and Judd Gregg of New Hampshire ... Mr. Conrad and Mr. Gregg said in interviews that they did not yet have the 60 votes needed to overcome a filibuster threat ... The administration, once cool to a commission, has been forced to become more supportive because the Senate must vote next week on raising the nation’s debt limit so the government can keep borrowing to pay for its operations, and the White House lacks the 60 votes needed. Mr. Conrad and others have indicated they will not endorse an increase without action on an amendment to create a deficit-reduction panel ... Mr. Orszag has emerged behind the scenes as a proponent of a panel ... But others, including Rahm Emanuel, the White House chief of staff and a former Democratic House leader, have warned that Republican Congressional leaders would choose for a commission’s Republican members only opponents of all tax increases, effectively sabotaging its work."
WH Calls For Jobs Bill To Build On Stimulus Success
NYT on new WH report showing up to 2 million jobs saved or created by stimulus: "The council’s report, the second of the quarterly assessments mandated by Congress, said that in the fourth quarter the stimulus plan’s tax cuts and spending added about 2 percentage points to the gross domestic product, which is the size of the economy as measured by the total goods and services produced. Though unemployment reached 10 percent at year’s end—two percentage points higher than the peak that the council forecast when the administration proposed the stimulus package to Congress nearly a year ago—the number of jobs was between 1.5 million to 2 million greater in the fourth quarter than it would have been without the recovery plan, the council said."
The Hill compares WH estimate to other forecasters: "The report stressed that the numbers are similar to independent estimates of the stimulus' impact. The Congressional Budget Office pegged the number of jobs saved or created by the stimulus last year to between 800,000 and 2.4 million. Other economists said that the stimulus had a smaller impact; Moody's Economy.com found the stimulus created almost 1.6 million jobs and IHS/Global Insight said that it created about 1.25 million jobs. "
WH believes jobs bill should build on what has worked. The Hill: "Romer said that any future jobs bill should build on the stimulus programs that have already had success. She noted that the $59 billion of the stimulus spent last year as fiscal relief for state and local governments helped stave off massive public employee layoffs, and she suggested that more fiscal relief would be effective. The president has called for a jobs bill that includes more relief for states, increased infrastructure spending, new small business loans and targeted tax credits."
AP attacks separate WH accounting of job creation, WH defends: "The White House has abandoned its controversial method of counting jobs under President Barack Obama's economic stimulus, making it impossible to track the number of jobs saved or created with the $787 billion in recovery money. Despite mounting a vigorous defense of its earlier count of more than 640,000 jobs credited to the stimulus, even after numerous errors were identified, the Obama administration now is making it easier to give the stimulus credit for hiring. It's no longer about counting a job as saved or created; now it's a matter of counting jobs funded by the stimulus ... The new rules are intended to streamline the process, said Tom Gavin, spokesman for the White House's Office of Management and Budget. They came in response to grant recipients who complained the reporting was too complicated, from lawmakers who complained the job counts were inconsistent and from watchdog groups who complained the information was unreliable, Gavin said. 'We're trying to make this as consistent and as uniform as we possibly can,' he said. The new stimulus job reports will continue to offer details about jobs and projects. But they were never expected to be the public accounting of Obama's goal to save or create 3.5 million jobs, Gavin said."
Leo Hindrey lays out a jobs agenda in HuffPost: "Throw their full weight behind an all-of-government, fully-empowered manufacturing and jobs policy ... Adopt 'Buy American' requirements related to federal government procurement ... Fund a 10-year program of significant public investment to upgrade and rebuild our nation's major infrastructure ..."
Murkowski's Lobbyist-Written Anti-EPA Amendment Expect Next Week
Several moderate Senators, including Energy and Natural Resources Chairman Jeff Bingaman of New Mexico, Agriculture Chairwoman Blanche Lincoln of Arkansas and Policy Chairman Byron Dorgan of North Dakota, have called for a change in tactics as they battle to secure cross party support for the proposed Boxer-Kerry climate change bill. They suggested that the White House delay the controversial cap-and-trade element of the bill and instead focus on passing a bill including energy reforms that will significantly reduce US carbon emissions.
However, Senator John Kerry, who is currently working on a compromise version of the bill with independent Senator Joe Lieberman and Republican Lindsey Graham, dismissed the idea, insisting that proposals to put a price on carbon emissions through a cap-and-trade scheme were central to the bill's success...
...Meanwhile, the row over the EPA's decision to issue an "endangerment finding " that allows it to regulate carbon emissions under the existing Clean Air Act escalated when Republican Senator Lisa Murkowski said yesterday that she would seek a vote next week that would stop the Agency from acting to tackle emissions ... An amendment that would stop the EPA from acting is now expected to be added to a vote on raising the US debt ceiling that is scheduled for January 20.
Greenpeace calls for investigation into lobbyist role. The Hill: "Greenpeace on Tuesday asked the Senate’s Select Committee on Ethics to probe the 'depth of the relationship' between Sen. Lisa Murkowski’s (R-Alaska) staff and two industry lobbyists they consulted about a proposal to block EPA from regulating greenhouse gas emissions."
Exact form of Murkowski amendment unclear. CongressDaily: "Murkowski Tuesday said she is still considering whether to offer an amendment to legislation expected to be considered in the full Senate Jan. 20 that increases the debt limit; an amendment to other legislation; or a resolution citing disapproval of EPA's efforts to regulate greenhouse gases. 'I really need to kind of figure out the pros and cons of a one-year timeout versus moving forward with a resolution of disapproval,' Murkowski said. 'They both have their advantages and disadvantages.'"
The Vine's Brad Plumer reports Dems are planning a counter amendment: "Even if Murkowski does move ahead, some industry types worry that Democrats could tack on their own 'second-degree' amendments that actually boost the EPA's efforts. For instance, the agency is trying to tailor its greenhouse-gas rules so that they only apply to the largest polluters (if every small source of CO2 was regulated, it'd be a nightmare). Opponents of regulation are trying to fight this move in court—they want the nightmare scenario. But congressional Dems could just pass their own tailoring rule and put an end to the lawsuits. "
Repower America calls on supporters to contact Congress to defeat Murkowski.
Politico reports push for climate bill continues, pressure for SOTU pledge: "Environmental organizations are already pushing to grab coveted airtime in the president’s State of the Union address in the next several weeks. Ideally, they’d like a public promise that passing a climate bill will remain a top priority this year — even as the battered economy and the loss of jobs dominate a congressional agenda that still includes health care reform ... Kerry and Sens. Lindsey Graham (R-S.C.) and Joe Lieberman (I-Conn.) remain committed to crafting a bipartisan climate proposal — one that they believe will pass the Senate this spring ... Aides to the three senators spent the Christmas recess in meetings about the legislation, crafting sections of the bill. And aides say the senators plan to strategize as soon as they return to Washington, having already scheduled meetings with key members ... The strategy is to gain support from key groups of Democrats by cutting deals to address the concerns of agricultural and manufacturing states."
