Each morning, Bill Scher and Terrance Heath serve up what progressives need to affect change on the kitchen-table issues families face: jobs, health care, green energy, financial reform, affordable education and retirement security.
Populist Charge On Senate Floor Frightens Wall Street
WH looking to temper populist momentum in Senate. NYT: "The liberal amendment that could be hardest to defeat — and is among the most deeply dreaded by Wall Street — [is] a proposal by Senator Sherrod Brown of Ohio and Senator Ted Kaufman of Delaware to break up the nation’s biggest banks by imposing caps on the deposits they can hold and limits on other liabilities ... After President Obama rallied the charge for weeks for tough new rules on Wall Street, the strong push by liberal Democrats is forcing the administration to prevent the bill from getting too tough ... in a preview of the legislative pirouettes that the administration may yet have to perform, the Treasury secretary ... signaled ... that the White House would work to scale back a provision ... that would require big banks to spin off most of their lucrative derivatives business."
"Audit the Fed" amendment could come up today. AP: "After the Senate deals with the Republican consumer protection amendment, it is scheduled to debate and vote on Sanders' proposal to audit the Federal Reserve. The measure has populist support from across the political spectrum, from tea party activists to liberals and labor organizations. The Federal Reserve and the Treasury oppose the measure, arguing it could interfere with the Fed's independence..."
Republicans look to weaken consumer protections. AP: "The Republican plan would limit the enforcement power of a proposed consumer protection bureau and make its rules subject to approval by a top banking regulator ... In contrast, the Democratic plan backed by the Obama administration would create an independent bureau within the Federal Reserve to police lending and other customer financial service transactions. It would have a freer hand to enforce its regulations."
First votes on amendments near-unanimous support for eliminating $50B liquidation fund, and explicitly preventing taxpayer-funded bailouts. NYT: "Senate leaders said they were working on an agreement that would allow debate on the regulatory legislation to proceed at a quicker pace." McClatchy adds: "lawmakers are signaling this time that they're willing to compromise on one of 2010's biggest legislative challenges."
Elimination of liquidation fund creates slight increase to deficit and opens up procedural challenge. The Hill: "Senate Republicans are plotting a budget point of order against the financial reform bill because it no longer complies with pay-as-you-go rules ... Republicans had [also] pushed for the elimination of the fund ... "
Rep. Luis Gutierrez rips Senate for scrapping liquidation fund: "I am alarmed at what is happening to consumer protections in the Senate finance reform bill and cannot remain silent. It is a case study in what happens to legislation when Wall Street lobbyists roll up their sleeves and get to work turning the screws on legislators until they get what they want — taxpayers be damned."
Wonk Room's Pat Garofalo sees conservatives harping on mortgages and ignoring everything else: "The GOP is flailing on consumer protection because it doesn’t want to do anything that will cut into the ability of banks to make a profit on confusing, obfuscatory financial products. But it also can’t deny that many people were hurt by the bank’s use of products that should have never been sold. So they’re left trying to call for prudential standards in one slice of the system..."
JPMorgan Chase distances itself from petulant attack on Senate investigators by one of its economists. Bloomberg: "JPMorgan Chase & Co. apologized after James Glassman, a senior economist at the bank, said members of the Senate’s Permanent Subcommittee on Investigations showed ignorance of market economics ... 'The hearings exposed an unnerving ignorance of fundamental principles of market economics by folks who have a hand in remapping rules of finance that will be with us for a while,' Glassman wrote, according to the note. 'Now that the financial reform debate is in the final innings, it’s time for the grownups to step in.'"
NYT's Paul Krugman responds to Glassman: "... the 'grownups' have again and again proved utterly clueless: they told us that it was crazy to blame market manipulation for electricity shortages, to question the case for invading Iraq, to suggest that there was a housing bubble, to doubt that derivatives were making finance safer. And yet they retain all of their arrogance and some of their prestige. Why?"
Obama pay czar expands review. Bloomberg: "Employees at more than 150 companies that received U.S. government aid when bailouts began will have their compensation scrutinized as part of a widening review by Obama administration pay supervisor Kenneth Feinberg ... He may use publicity to pressure executives to return compensation even if he doesn’t have the legal authority to recoup the money."
Status of Bank Tax To Repay TARP Unclear
Conservatives resist new levies on big banks to repay TARP. W. Post: "...some Democrats said they are reluctant to include the tax because it could complicate prospects for the hotly contested overhaul bill. They added that Sen. Max Baucus ... is instead considering whether to include a new bank tax in a bill he plans to introduce extending some existing tax cuts ... Several [Republicans] questioned whether the tax would unduly punish banks and crimp lending to small businesses and consumers."
House Ways & Means chair doesn't want bank tax to offset other spending. CQ: "'The administration made clear its position, and it should be used for deficit reduction,' [Rep. Sander] Levin, D-Mich., said of the bank tax. 'At this point, I don’t think the bank tax is ready to be a pay-for.'"
Conservative Sen. Chuck Grassley's attack on the bank tax is "detached from reality" says TNR's Jonathan Chait: "In the Republican view, tax cuts do not increase deficits, because they either 1) produce enough growth to increase revenue, or 2) reduce revenue and thus 'starve the beast' of spending, or, somehow, both. A corollary holds that tax hikes do not reduce deficits, because they either 3) decrease economic growth and thus decrease revenue, or because 4) the added revenue will cause the government to spend more money. Grassley was expressing idea #4 ... All four elements of the Republican tax catechism have been utterly destroyed by empirical reality."
Senate Climate Bill May Come Next Week
Senate climate bill may be unveiled next week, with or without Sen. Lindsey Graham. Politico: "...Kerry and Lieberman are gambling that the dramatic oil spill in the Gulf of Mexico will help, rather than hurt, momentum for the legislation ... the reform package includes provisions that allow an expansion of offshore drilling and generous revenue sharing for coastal states that allow it ...Sen. Bill Nelson (D-Fla.) threatened to filibuster the legislation [if drilling is expanded] ... [Kerry and Lieberman] could insist that any future rigs include more safeguards against such a spill. They could also insert language that beefs up oil company liability in the case of such economic and environmental disasters."
Kerry previews bill's approach to reducing carbon emissions from oil. The Hill: "'There is no tax in this bill. There is the principle that the polluter pays ... oil companies are prepared in this bill to pay a pollution charge directly to the government and that money goes back to you,' Kerry added ... Kerry said that consumers would initially get two-thirds of the money the bill raises from the sale of carbon permits to polluting industries. The balance would go to energy efficiency programs, research and development programs and to help 'cushion' the impact on energy-intensive manufacturing industries. After an initial phase – it’s not clear how long – Kerry told reporters that 96 percent of the funds go back to consumers, with the remainder reserved for deficit reduction."
TNR's Brad Plumer sees Kerry going easy on Big Oil: "A lot of other members of Congress are ready to tear BP to shreds, but Kerry still sounds like he needs their cooperation in order to pass legislation. Indeed, he and Lieberman have said they want to keep the offshore drilling provisions in their climate bill, whatever those might be. (By the way, BP is one of three major oil companies that's reportedly ready to support the bill.)"
"Big Oil Bailout Prevention Act" introduced in Congress. The Hill: "The measure ... would raise the cap on economic damages for oil spills from $75 million to $10 billion ... 'The Speaker supports this legislation and hopes it will come to the floor quickly,' Pelosi spokesman Drew Hammill [said] ... A spokesman for House GOP leader John Boehner (Ohio) reacted cautiously to the Democrats’ new proposal." Rep. Bart Stupak signals "No" vote.
BP lobbyists in high gear. W. Post: "The onslaught underscores the expanding political role of BP, which has spent nearly $20 million on Washington lobbying since January 2009 ... BP's more aggressive lobbying efforts in recent years have been a disappointment to environmental groups, which were heartened by the company's earlier pledges to move 'beyond petroleum' ..."
BP's donations to Congress are more worrying than its donations to Obama. Grist's Jonathan Hiskes: "President Obama has received the most — $77,051 — which might seem surprising at first blush. But presidential candidates receive a lot more than everybody else ... more oil money goes to Congress as a whole than to presidential candidates ... he wants to sign a decent clean-energy bill, according to everything we've seen him do and heard him say. The Senate is where the bill is stalled out. That's where oil money is doing the most damage."
Sen. Robert Byrd, after decades of defending coal, pens a scorching editorial call on the industry to embrace change: "...the coal industry has an immensely powerful lobby in Washington and in Charleston. For nearly a hundred years they have come to our presidents, our members of Congress, our legislators, our mayors, and our county commissioners to demand their priorities. It is only right that the people of West Virginia speak up and make the coal industry understand what is expected of it in return."
TreeHugger's Daniel Kessler suggests to Byrd: "If he really wants to hold coal's feet to the fire, he can support the comprehensive climate soon to be introduced in the Senate."
Obama Puts Immigration On A Slower Track
President signals immigration reform won't be finished this year. LAT: "Obama, speaking at a Cinco de Mayo reception in the Rose Garden, was silent on a timetable for completing an immigration bill ... 'I want to begin work this year...'"
Sen. Graham continues nonsensical hissy fit. Politico: "Sen. Lindsey Graham (R-S.C.) assailed President Barack Obama’s attempts to find other Republican senators willing to support immigration reform this year, calling the effort a 'raw display of partisanship.'"
School Stim Needed To Save Teaching Jobs
NYT edit board backs school stimulus prevent mass teacher layoffs: "The need for a second school stimulus plan was underscored on Monday by a new analysis from the American Association of School Administrators, which reported that cash-strapped districts were prepared to cut as many 275,000 jobs in the 2010-2011 school year. The loss of that many paychecks — and the resulting decline in consumer spending — could kill off still more jobs in the communities where teachers and other school employees live."
W. Post's Harold Meyerson pins blame on deficit hysterics for starving schools: "It is a mantra of the deficit hawks that they are working to ensure their children and grandchildren will one day have the same opportunities that they have had. But right now, in real time, those same children and grandchildren are having those opportunities taken away."
Conservative Sen. Richard Burr sees no reason to help save teachers from layoffs. Wonk Room's Pat Garofalo: "'[National Journal reports,] Richard Burr of North Carolina, said he hadn’t seen the bill but 'couldn’t imagine' he would support it, positing that it’s not the role of the federal government to hire teachers.' Burr might want to spend some time imagining what teacher layoffs in his own state would look like. There are currently 3,700 fewer teachers working in North Carolina than there were last year..."
No Transparency From WH Debt Commission
HuffPost's Dan Froomkin questions what's going on behind debt commission's closed doors:: "Bruce Reed, the commission's executive director, assured the Huffington Post there is nothing sinister about holding working group meetings like today's in private. But he had no good reason why they shouldn't be held in public, either... Rep. John Conyers, Jr. (D-Mich.) and 15 other progressive members of Congress last week sent a letter to the commission's co-chairs, asking that they allow C-SPAN coverage and Internet streaming of all the panel's meeting and deliberations, including those 'working groups' -- which they figure are actually the most likely place that deals are going to get cut. House Minority Leader John Boehner sent the commission a similar letter in March ... Alex Lawson, communications director for the progressive group Social Security Works stood outside the commission's meeting room Wednesday morning and livestreamed the door closing over and over again..."
