Financial Reform Moves Into Spotlight
Financial reform rises to the next major legislative priority. NYT: "...two crucial Republicans on the Senate Banking Committee, Judd Gregg of New Hampshire and Bob Corker of Tennessee, said they expected the overhaul to pass this year even though they had concerns about some provisions. A Democratic strategy appeared to be emerging: expressing confidence that the measure would pass and urging Republicans to help shape [it] rather than trying to block it."
Baseline Scenario's Simon Johnson sees the "emerging strategy" as ominous for bold reforms: "The indications are that some version of the Dodd bill will be presented to Democrats and Republicans alike as a fait accompli ... whatever you do – they say to the Democrats – don’t rock the boat with any strengthening amendments ... Republicans, such as Judd Gregg and Bob Corker, may be getting on board with exactly this."
TAP's Tim Fernholz counsels Dems to force GOP to support or block bold reform: "I find it hard to believe that moderate Republicans will join their party to oppose a package of essentially commonsense regulations in the name of partisanship ... After watching the Republican reaction to health care's passage, it is time to cast aside any illusions that another path to success exists."
President tells Dodd to move with or without GOP. W. Post: "...Obama urged the Democratic sponsors of financial legislation in the Senate and House to press ahead with or without Republican backing, according to sources familiar with the 45-minute White House strategy session. The president told them the Democrats have the upper hand and should not give too much ground."
Dodd directly challenges GOP to get on board or face voter wrath. The Hill: “'My hope is that they’ll want to talk about solutions,' Dodd said. 'Or they can just sit there and explain to people why they want to side with the largest financial institutions ... So we’ll see how they respond, and I hope they don’t make the same mistake they made on healthcare,' Dodd concluded."
Corker laments missed opportunity for bipartisan deal, now that Dems are on a roll: "He also took an unusually public swipe at Sen. Richard C. Shelby (Ala.), the ranking Republican on the banking committee ... 'It would have been better, in fairness, had Senator Shelby been negotiating a bipartisan bill last September, October, November...' Instead, Corker said Republicans now confront Democratic officials who 'are emboldened, the testosterone and other juices are flowing' after the enactment of the health-care bill."
The Economist's Ryan Avent slams Dodd's "too-big-to-fail" approach: "... the bill is relying very heavily on resolution authority, as opposed to measures limiting firm size or leverage or interconnectedness ... some firms will be really big and systemically risky, and then you give regulators discretion to use or not use resolution authority. Discretion, under these circumstances, is exactly what you don't want. It creates doubt in markets that regulators will actually pull the trigger, which will lead to greater risktaking by firms, which will make it more difficult for regulators to pull the trigger in times of crisis."
Treasury directly chastises Chamber of Commerce for anti-CFPA campaign. McClatchy: "...in a speech at the Chamber of Commerce, Deputy Treasury Secretary Neal S. Wolin blasted the Chamber's $3 million ad campaign against financial-regulation legislation, charging that its efforts were aimed at killing any new regulation."
Unions taking leadership role in financial reform debate. NYT: "Unions are holding up many of their own members as victims of the banks’ bad bets, like subprime mortgages, and are providing a steady stream of research in an effort to demystify the exotic financial products that they say are harming dozens of cities."
NYT profiles Elizabeth Warren, CFPA advocate and possible chair: " The president lights up when her consumer protection ideas are discussed ... Her relationship with Treasury is chillier ... she has worked closely with some officials there on regulatory reform. But in her [TARP] oversight role, she pounds the agency..."
Senate May Finish Health Care Early, But One More House Vote Needed
Technical parliamentary ruling will slightly alter reconciliation bill, require one more House vote. The Hill: "Democrats said Frumin’s ruling was expected and that any verdict of a Republican victory was an exaggeration."
HuffPost's Ryan Grim suggests with new vote needed, door is open to public option amendment: "Democratic leadership no longer has to worry that additional amendments would send it back to the House, since it must return to the lower chamber regardless. The Senate is now free to put to the test that much-debated question of whether 50 votes exist for a public option."
Sen. Sanders wins promise for a future vote on public option. NYT: "[Sanders] said he had secured a commitment from the majority leader, Harry Reid of Nevada, for a future vote on a public plan, when it could well be harder to pass. But Mr. Sanders also said Democrats were smart to quit while they were ahead. 'Is it possible that if I or somebody else introduced the public option today, that it conceivably would go back to the House and be passed?' ... Yes. Is it possible that it would fail? Yes. Is it possible then you would not have the reconciliation bill? Absolutely. Is that a risk work taking at this moment? I think not.'"
Final Senate vote could be today. The Hill: "Senate Republicans had threatened to offer scores or even hundreds of amendments to keep the healthcare legislation from getting out of the chamber. But GOP lawmakers have decided not to employ the dilatory tactic and instead call for votes on substantive amendments."
Obama will enroll in new health insurance exchange. AP: "The White House announced Obama's planned participation in a statement Wednesday after Republican Sen. Charles Grassley of Iowa introduced an amendment that would have required Obama to go into the exchanges."
TNR's Jonathan Chait debunks the conservative "doc fix" claim: "...this is not one of the costs of health care reform ... the imaginary future savings of cutting physician reimbursement is not one of the cost offsets for health care reform ... [And] none of the Republican plans account for the doc fix [either]."
Matthew Yglesias dubs Mitt Romney America's most shameless politician: "...the two pillars of Romney’s political career—the health-care plan and his unswerving determination to pander to the conservative base—have come into sharp, almost embarrassing, tension." "Where Does Mitt Romney Stand On The Individual Mandate?" asks Wonk Room.
China Refuses To End Currency Manipulation
China digs in on currency. NYT: "After meeting with officials at the Treasury and Commerce Departments on Wednesday, China’s deputy commerce minister, Zhong Shan, told reporters, 'The Chinese government will not succumb to foreign pressures to adjust our exchange rate.'"
China Blows Past US In Clean Energy Investments
US officially falls behind China in clean energy investment. LAT: "U.S. clean energy investments hit $18.6 billion last year, a report from the Pew Charitable Trusts said, a little more than half the Chinese total of $34.6 billion ... The United States also slipped behind 10 other countries ... [Pew pointed to] a lack of national mandates for renewable energy production or a surcharge on greenhouse gas emissions that would make fossil fuels more expensive."
"Smart Grid Stimulus Funds Finally Trickling In" reports Earth2Tech: "...getting contracts in the hands of utility project managers is just the first of many steps to getting dollars into the hands of vendors and workers, but it’s a good start."
"Cash For Caulkers" advances in House cmte. CQ: "...the program would provide rebates ranging from $50 to $3,000 for homeowners to hire firms to install new heating and air conditioning systems, and to replace old windows and doors. ... the draft measure would authorize $6 billion for fiscal 2010 and 2011 for the Energy Department to oversee the project."
WH "encouraged" by Senate climate talks. The Hill: "White House climate czar Carol Browner on Wednesday said the Obama administration is working hard to advance Senate climate and energy legislation, but declined to weigh in on a brewing Senate proposal to impose a carbon tax on motor fuels."
No climate bill draft before Senate recess. The Hill: "Senate meetings on planned climate and energy legislation continued at a fast clip Wednesday but the bill’s architects ... are not far along enough to release a long-awaited draft before the Spring recess that begins Monday ... Freshman Democrat Mark Begich (Alaska), who is considered a swing vote on climate change, said he likes what he sees thus far on offshore drilling provisions..."
Cap-and-dividend bill sponsors Sens. Cantwell and Collins criticize emerging bill. Reuters: "'We probably still have a difference of opinion on creation of trading platforms,' Cantwell told reporters. 'There are some who believe that you actually have to have trading to have liquidity,' she added. 'I think a clear price market signal without volatility will unleash the investment.' But Senator Lindsey Graham .... expressed strong opposition to the Cantwell-Collins approach for pricing carbon. 'If you're a southeastern state or a midwestern state where you're coal heavy, their approach basically collects money from your constituents and sends it to hydropower states and other states.'"
Debt Commission Panelists All Named
Speaker Pelosi names 3 to complete President's debt commission, two from Progressive Caucus. WSJ: "It’s an interesting mix. Spratt, chairman of the Budget Committee, is one of the House Democrats’ staunchest fiscal conservatives; Becerra is a close aide to Pelosi and a member of the leadership team, and Schakowsky is one of the chamber’s most liberal members."
Dean Baker rips NYT for another misleading Social Security scare story: "A front page NYT story noted that Social Security benefit payments this year exceed its tax collections. As both the experts cited in the article pointed out, this fact makes absolutely no difference for the program since it holds more than $2.5 trillion in government bonds."
Jobs Agenda Inches Along
Politico on the latest jobs measures to clear House: "... a $19.3 billion measure, combining small business tax breaks with bond subsidies to help state and local governments finance public works projects, won approval 246-178. Less than two hours later, a disaster aid bill to which $600 million was attached for youth summer jobs passed 239-175 ... in the case of the larger $19.3 billion small business and infrastructure bill, tax writers fell back on a series of changes in the code to close loopholes and crackdown on foreign multinational corporations which use tax haven countries to avoid taxes on income earned in the U.S."
Most GOPers oppose bills. Politico: "Such disaster aid appeals typically generate bipartisan support in the past. But just five Republicans voted for the FEMA-summer jobs package Wednesday and many said their decision had to be seen in the context of the healthcare debate..."
Many GOPers oppose larger jobs bill over closing of tax haven loophole. CQ: "The cost of the legislation is partly covered by a controversial provision that would require U.S. subsidiaries of foreign-owned companies to pay taxes they could previously avoid by sending the funds to another country. That provision is expected to raise $7.7 billion over 10 years. Republicans criticized the offset provision."
