GOP (+1 Dem) Filibusters Wall Street Reform
After GOP blocks consideration of Wall Street reform, Sen. Maj. Leader Harry Reid to continue hold cloture votes to pressure Republicans. The Hill: "A senior Democratic aide said Reid would schedule votes to end a Republican filibuster of the reform bill on Tuesday and Wednesday of this week."
OurFuture.org's Zach Carter says filibuster unmasks "phony populism": "Last night's Republican-plus-Nelson filibuster was an effort to preserve an unacceptable status quo."
OurFuture.org's Richard Eskow notes GOP is throwing away compromises in favor of obstructionism: "The bill contains many measures that Republicans say they want ... This latest act of obstruction is merely the cap on the Republican Party's long season of unprecedented noncooperation in addressing a grave economic crisis."
DailyKos's mcjoan explains why conservatives suddenly prefer back-room deals instead of open floor debate: "So this a new twist to the old obstruction trope. In the health debate, they drug out the negotiations to try to kill the bill, knowing that time was a critical factor for the bill's defeat. This one is different, because killing this bill isn't in their best political interests, not when the American population is so angry at Wall Street. However, negotiating on behalf of Wall Street to water reform down--e.g., weaker consumer protections, minimal federal regulation--is in their political interest."
Goldman Sachs testimony today seen as bolstering reform efforts. Politico: "Democratic leaders are planning a series of votes on the same bill until it passes — confident that Republicans can’t hold together for long. And Democrats believe they’ve got an ace in the hole: Lloyd Blankfein, the Goldman Sachs CEO."
Significant differences remains between Dodd and Shelby. Politico: "Aides to Republicans on the Banking Committee said the bill still contained significant loopholes that would allow for future taxpayer bailouts – a term that they defined as assistance to not just the failing firm, but also to creditors ... The aides also detailed extensive concerns over the scope and authority of the proposed consumer protection agency."
HuffPost's Sam Stein reports the one Democrat to filibuster did it on behalf of billionaire Warren Buffet: "The removal of a provision that would have dramatically benefited financial tycoon and Nebraska native Warren Buffett, it was said, played a role in the Senator's flip. 'He was on board until today and the only thing that changed was the removal of that provision,' said one Democratic aide ... which would have exempted any existing derivatives contracts from being subjected to new capital requirements. That provision had been pushed by Buffett's Berkshire Hathaway Inc., which has $63 billion in existing derivatives contracts..."
Chamber of Commerce successfully spreading misinformation to small businesses about Wall Street reform. NYT: "[The Senate financial services committees spokeswoman] said that opponents of the legislation from the Chamber of Commerce and elsewhere have sought to stir concerns and “gin up everybody” over what are often unfounded concerns about wider implications for businesses across the country. Legitimate or not, those concerns have taken hold across a wide swath of private companies..."
HuffPo's Chris Weigant says Harry Reid has called the GOP's bluff on financial reform: "... the strategy Reid and President Obama have taken -- refuse to give in to the lobbyists. Stand up for strong reform, and shout it from the mountaintops. Defy Republicans to obstruct the effort, and vow to exact a political price upon them for doing so. This is precisely what Reid just did. Republicans, in this metaphorical card game, not only have a bad hand to play, but they were actually allowed to thumb through the deck and pick their own cards, and they still have no good cards to play."
Baseline Scenario's Simon Johnson argues Dems should respond to filibuster by upping the ante, breaking up the banks: "If the Democratic leadership becomes fed up with Republican stalling – or otherwise sees an opportunity to paint the Republicans as completely obstructionist, they could actually strengthen the bill. For example, including something like the Brown-Kaufman amendment (or otherwise addressing the issues posed by our six megabanks) would make it easier for people to understand what is at stake."
Dean Baker chastises WH econ aide Larry Summers for claiming we need giant banks. "[Said Summers,] 'Most observers who study this believe that to try to break banks up into a lot of little pieces would hurt our ability to try to serve large companies, and hurt the competitiveness of the United States.' It would have been worth pointing out to readers that Summers' asssertion is not obviously true. Many prominent experts on banking, including two current regional Federal Reserve Bank presidents and Simon Johnson, the former chief economist at the IMF, have argued that the country does not need banks that are as large as the too big to fail institutions..."
Pushing Rope also takes on Summers: "Summers argues in favor of a monopony banking system ... The Gramm-Leach-Bliley Act repealed the law prevent commercial and inventment banks from merging. Former President Bill Clinton admitted signing the Gramm-Leach-Bliley Act was a mistake. A fun little fact is Lawrence Summers was one of the people telling Clinton to sign Gramm-Leach-Bliley Act."
Senate Investigations Cmte finds Goldman Sachs misled its clients and nation, in advance of CEO testimony today. McClatchy: "Goldman Sachs reaped 'billions and billions of dollars' in profits by secretly betting in 2006 and 2007 that the U.S. housing market would crash, a strategy that conflicted with the interests of its clients who were still buying the firm's risky mortgage securities, Senate investigators said Monday."
Wall Streeters whine, defend Goldman. NYT: "Many ... seem to side, or at least sympathize, with Goldman, out of a belief that Goldman had done nothing wrong in helping clients place bets that the housing bubble was going to burst."
Slate's Eliot Spitzer says Goldman is nothing but a casino operator:: "...we must ask whether what Goldman and others investment banks do deserves the huge public subsidies they have received. Do they do anything that has any real social value? ... The regulators, legislators, and investigators have not focused on the fact that the fundamental business of banking has changed from capital allocation to, essentially, gambling."
White House Debt Commission Meets Today
White House debt commission meets this AM, leading with remarks from the President, streaming live on whitehouse.gov.
The Virtual Summit on Fiscal and Economic Responsibility for People Who Did Not Wreck the Economy continues at ourfuture.org/virtualsummit.
Dean Baker casts one side of the deficit debate as "argument by authority": "These affairs are not about promoting a real exchange of views on issues ... the purpose of these events is to tell the public that everyone agrees, we have to cut the deficit. And, this means cutting social security and Medicare. This is argument by authority."
Robert Borosage attacks Washington establishment for ignoring weak economy and pushing deficit reduction, in Politico oped: "Choosing between deficit reduction or greater stimulus isn’t a matter of taste or of economic mumbo jumbo. It’s about values and priorities. For too many lawmakers, high unemployment seems to be an acceptable price for fiscal probity. But there are worse things than deficits, and grinding mass unemployment is one of them."
Social Security defenders warn WH debt commission. CQ: "'Social Security has not contributed one thin dime to the current deficit,' former Rep. Barbara B. Kennelly, D-Conn. (1982-99), who is president of the National Committee to Preserve Social Security and Medicare ... Kennelly said her group would mobilize its 3 million members to push back against any attempt to significantly alter the program."
Dean Baker also rips WH debt commission co-chair Alan Simpson for scapegoating seniors: "Have you heard Alan Simpson making fun of the Social Security beneficiaries who drive up to their gated community in a Lexis? How many times? How many have heard his quip comparing the Grey Panthers to the Pink Panther? That one dates from the mid-90s, but the reporters who cover these issues still love it ... It would be difficult to find a person who spreads more misinformation and shows more hatred towards the non-rich elderly than Mr. Simpson."
Push To Keep Climate Bill Alive
Sen. John Kerry rejects the climate bill naysayers, at TPMCafe: " No serious legislation ever makes it very far in Congress before it's declared dead - at least once, sometimes two or three times."
Graham ups the ante, says even if immigration comes up after climate, he'll oppose both. The Hill quotes: "Do you think that I would sit on the sidelines and see immigration brought up like this and not object? I am not going to be a party to bringing up immigration...this year in a way that will destroy that issue.”
Businesses, unions reject delay of climate bill roll-out. The Hill: "The U.S. Climate Action Partnership on Monday afternoon called on the Senate to make a climate and energy bill a 'top priority' this year. The group combines several large environmental groups and major corporations, including General Electric, Shell Oil and the Big Three Detroit automakers ... the Utility Workers Union of America issued a statement Monday proclaiming itself angered by the delay in rolling out the bill. The group said the legislation would create two million jobs."
Pressure on the President to increase personal involvement, reports Bloomberg.
Supporters of a narrow energy bill that does not cap carbon see an opening. ClimateWire: "Two moderate Republicans who Obama and Democrats have been courting on both issues said they would prefer to start with the energy issue ... Lugar said he has suggested to staff that they quickly finish writing an energy bill with the hopes it could gain traction instead."
Australia's Green Party joins with conservatives to scuttle climate bill. NYT: "Conservatives said the plan would stifle economic growth while environmentalists argued that it gave too many concessions to big polluters."
Nuclear power chief Exelon's John Rowe makes case for pricing carbon in LAT interview: "What matters is that people realize that carbon tax, or cap and trade, is the low-cost solution, not the high-cost solution."
Cape Wind decision is crucial for growth of wind power industry. NYT: "...some developers say a thumbs-down could gut America’s offshore wind industry before it ever really gets started."
Treehugger's Brian Merchant on what rejection of Cape Wind would mean: "...it offers grounds for all those who oppose wind power for aesthetic reasons to claim their arguments are valid, and it sends a dubious signal about support for renewable energy. It doesn't bode well for many progressives to argue in favor of increased support for renewables and then scuttle the projects proposed in their own backyards."
TNR's Brad Plumer argues there some areas where federal rules should overrule strong climate regs in states: "If there's a federal cap-and-trade system, then it doesn't make a ton of sense to let some states set up stricter targets—all that does is allow slacker states to slack off even more, and overall pollution levels will remain the same. On the other hand, there are some areas where it makes sense to let states forge ahead of Congress. If an individual state wants to tighten its building codes, or build more renewable power over and beyond whatever the federal standard calls for, or tackle emissions not covered by the cap-and-trade program (like agriculture)..."
Arizona Boycott
Calls spread to boycott Arizona over anti-immigrant law. NYT: "Several immigrant advocates and civil rights groups, joined by members of the San Francisco government, said the state should pay economic consequences ... Tourism and convention managers, struggling to rebound from the recession, said it was too soon to tell if the effort would have an impact, but some businesses said people were turning away from the state." More from USA Today.
Border Reporter's Michel Marizco warns Arizona may face costly lawsuits:: "This is the choice police departments now face — be sued for racial profiling or be sued for not enforcing immigration law. Good luck with that."
Breakfast Sides
Home buyer tax credit found to be inefficient stimulus. NYT: "For every [new] home buyer ... real estate agents say there are at least three others who collected the credit even though they would have bought without it. That means for each new buyer who was truly lured into the market by the credit, the federal government paid more than $30,000."
Calculated Risk argues the home buyer tax credit fared even worse: "... the ratio was probably 5-to-1 for the initial credit and even higher for the extension ... I'm not convinced that supporting house prices above the market clearing level to help the banks and boost consumer confidence makes sense. I think targeting jobs - and therefore household formation - would have been a far more cost effective program."
Seniors still getting private Medicare Advantage coverage, despite end to wasteful subsidies. Wonk Room's Igor Volsky: " Earlier this month, BNet’s Ken Terry wrote that 'If these companies were really concerned about the impending cuts, they’d be heading for the exits right now.' ... Indeed, now even insurers are admitting that they may very well survive the cuts."
