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.
MORNING MESSAGE: The "Undo Everything" Congress Begins
OurFuture.org's Terrance Heath: "The 112th Congress will not be the 'Do Something' Congress that the 111th was. It would be a relief if this turned out to be the 'Do Nothing' Congress that the new House 'one-week-off-for-every-two-weeks-worked' schedule suggests. Instead, it's already shaping up to be the 'Undo Everything' Congress, working hard to rewind the clock to 2008 or earlier ... However productive the previous Congress was, none of the reforms it passed are 'done deals,' and they won't be 'done' without progressives working to strengthen and expand them to benefit all Americans."
New House Begins By Breaking Own Rules
First act of the new House: weakening fiscal discipline. Bloomberg: "In one of their first acts in the majority, House Republican yesterday won approval of weakened anti-deficit budgeting rules that will make it easier for them to approve tax cuts even if they add to the government’s financial shortfall. The rules exempt most of the tax-cut proposals Republicans are expected to propose from having to be offset with budget savings elsewhere."
House GOP doesn't waste time breaking its own rules. Politico: "After calling for bills to go through a regular committee process, the bill that would repeal the health care law will not go through a single committee. Despite promising a more open amendment process for bills, amendments for the health care repeal will be all but shut down. After calling for a strict committee attendance list to be posted online, Republicans backpedaled and ditched that from the rules. They promised constitutional citations for every bill but have yet to add that language to early bills."
Tea Party activist leader calls GOP backtrack on spending cuts an "absolute joke" reports CBS.
Jack & Jack Politics' Jill Tubman notes the "Tea Pot" seems to have run out of steam: "I watched 10 Tea Party freshmen members of Congress on Good Morning America this am (video above). When Diane Sawyer asked if any of them would give up their subsidized Congressional healthcare plans in line with their vision for repealing healthcare reform, only one said he would. The rest looked uncomfortable and had some lame excuses about supporting employer-provided healthcare. ... Their so-called Pledge to America to cut $100 billion, well, that’s now been cut by half and I predict it will be cut by half & then half again before we’re through. Or maybe nothing will get actually cut. Sawyer also asked about cutting farm subsidies from which many of the Tea Party frosh also benefit — again, shrugged shoulders and downcast eyes."
House Budget Chair Paul Ryan still planning major cuts. W. Post: Ryan vowed Wednesday to press ahead with a GOP campaign pledge to pare spending unrelated to defense and homeland security back to 2008 levels, a move that Democrats say could decimate dozens of programs, including state education aid, the space program, the FBI and services at hundreds of national parks."
But when asked, Ryan won't say what he'll actually cut. Daily Kos' Joan McCarter: "Perhaps one of the reasons the House Republicans are reneging on their spending cut pledge is because, well, they don't have a clue what they're doing. Here's wunderkind Paul Ryan [on NBC], unable to come up with one specific cut ... Given enough rope, they'll hang themselves. They don't have ideas, they don't have a plan and they're not capable of governing."
AEI's Norm Ornstein spots a disturbing provision in the new House budget rules: "[There's a] provision in the rules to deputize the chairman of the House Budget Committee to unilaterally create spending and revenue limits and caps by committee and enact them simply by publishing them in the Congressional Record. This is breathtaking: It demolishes the Congressional budget process in one fell swoop ... Members, by voting in lockstep to enact a package of rules, will implicitly vote for a budget they have never seen ... When individual appropriations come up, any proposal that changes the edicts of Budget Chairman Paul Ryan (R-Wis.) by restoring cuts in spending will be ruled out of order. Dramatic and Draconian budget cuts without votes or debate."
More funny business in the House budget rules from CQ: "The rules give Budget Chairman Paul D. Ryan, R-Wis., the authority to exempt several tax cuts ... from cost-reporting requirements under the pay-as-you-go law. Under the 2010 budgetary statute, the House and Senate Budget chairmen must submit cost estimates for legislation affecting mandatory programs or tax revenues. The administration uses those estimates to determine whether increased spending or reduced revenues have been offset, as required by the law. Under the new rules, Ryan also would not have to include cost estimates for a permanent extension of a reduced estate tax, for preventing more taxpayers from being hit by the alternative minimum tax, for a small-business tax deduction and for the cost of implementing trade agreements."
TNR's Jonathan Bernstein suggests Speaker Boehner has a simple formula to keep the Tea Party in check: "... John Boehner and the House Republicans are very obviously moving to the realm of pure symbolism with their [health care] repeal vote scheduled right away ... I think it's an indication that Boehner believes that the Tea Partiers are going to be a fairly easy bunch to manage. Toss them some symbolic stuff, and then blame everything after that on Harry Reid and Barack Obama, and you've pretty much done what you need to do ... Can a series of symbolic triumphs provide cover for House Republicans if and when they let down their activists on spending and the deficit? Hard to tell."
At Open left, Paul Rosenberg wonders if the GOP is out to destroy the economy: "No one could possibly do more to destroy the rock-solid credit-worthiness of longterm US securities than Republicans threatening to prevent a rise in the debt limit ... It's impossible to believe that the Democrats will let this happen, but even just talking about it is bound to be bad for the economy--not the US economy, but the world economy, on which we largely depend, given the degree of global integration we now 'enjoy.' ...Republicans are actually planning to make things worse. They now see the failure of state and local governments as a feature, not a bug: It will allow them to break public employee unions, and that's far more important to them than having the US economy recover. In fact, with their #1 aim being the defeat of Barack Obama in 2012, the goal of having the US economy recover is really nowhere on their political horizon."
Dems lay out "bipartisan" agenda, including deficit reduction. W. Post: "Democratic leaders say they could take up the cause of deficit reduction, urge a free-trade agreement with South Korea and advocate for an overhaul of the nation's immigration laws ... Democrats will try a different approach - attempting to re-create the unexpected cooperation of December's lame-duck session ... Some Republicans are talking with key Democrats about beginning a deficit-reduction effort that could define the next year and become one of the dominant themes of Obama's reelection campaign."
Some Dems going wobbly on individual mandate. The Hill: "Sen. Claire McCaskill (D-Mo.), one of President Obama’s closest allies in the Senate, on Wednesday said she would consider scrapping the controversial mandate in favor of a 'viable' alternative ... McCaskill is facing a tough reelection race in 2012 ... Sen. Bill Nelson (Fla.), another Democrat who could have a neck-and-neck race in 2012, declined to defend the individual mandate ..."
Filibuster Reform On Senate Table
Dems formally propose filibuster reforms. WSJ: "The plan would allow debate to begin on any measure with a simple 51-vote majority, rather than the 60-vote supermajority the minority party can currently insist upon. It would prevent senators from putting secret 'holds' on nominations or legislation, and guarantee the minority party the right to introduce amendments to legislation on the floor of the Senate. Under the rules, lawmakers who want to prevent a vote on final passage of legislation would be forced to take the floor of the Senate to defend their stance – and would have to remain there as long as the bill was being debated."
"Reform The Filibuster, Shame The Hypocrites" argues OurFuture.org's Richard Eskow: "[The] proposal doesn't have everything it should. But it would stop Senators from blocking debate and then hiding their actions from the voters. And it would end that little gadget that every Senator possesses: a remote control for overriding the democratic process. The 'secret hold' lets a Senator hit the 'mute' button on public debate without even getting out of the easy chair in his Georgetown condo."
White House Moves May Seek Improved Ties To CEOs
President on verge of major staff moves. NYT: "William M. Daley ... visited the West Wing to meet with the president and other advisers for a final series of discussions about serving as chief of staff ... Gene Sperling, a counselor to Treasury Secretary Timothy F. Geithner, was expected to be named on Friday as the director of the National Economic Council ... While Mr. Daley and Mr. Sperling are perceived as centrists and could leave liberals further concerned about the administration’s commitment to its views, the real evidence of where the president is heading will not come until the State of the Union address later this month and the unveiling of the president’s budget in February ... Mr. Obama is also expected ... to move Ron Bloom, a Treasury adviser who oversaw the administration’s bailout and restructuring of the auto industry, into the White House to continue advising him on manufacturing policy."
President to address U.S. Chamber of Commerce next month. The Hill: "His speech next month will be seen as the latest sign that the administration wants the business community’s favor, or at least neutrality, in the 2012 presidential election."
The American Prospect's Matthew Yglesias counsels White House to quit worrying about CEOs: "What's needed in a White House staff is people who will help with the difficult business of administering the executive branch. If that means Daley ... so be it, but building sentimental bridges to corporate America should play no part of it. Making businessmen happy is neither necessary nor sufficient to produce economic growth. Business-community whining wasn't a barrier to growth in the 1930s or the 1990s. Nor did growth in the 1930s or 1990s put an end to business-community whining."
Labor movement gears up for major challenge to corporate leaders. Politico: "...the new union campaign will attempt, in particular, to prevent a split between public- and private-sector workers and to defend the public workers from sharp cuts to their pay, benefits and right to bargain collectively. The effort also hopes to co-opt the 'reform' mantle to make the case that while workers are willing to give back some benefits, 'shared sacrifice' — meaning taxes on the rich and corporations as well — should be the order of the day."
At the Guardian, Paul Harris points out the peculiarities of America's anti-union backlash: "...powerful and reckless unions did not cause the Great Recession by rampant speculation. Nor did an out-of-control labour movement cause or burst the housing bubble. It was not union bosses who packaged up complex derivatives to sell in their millions and thus wrecked the economy and put millions out of work. Nor was it union bosses who awarded (and continue to award) themselves salaries worth hundreds of millions of dollars for doing nothing of social value. Neither was it the union movement that was bailed out by the taxpayer and then refused to change its habits. All that was the work of the finance industry."
Bernanke To Push Deficit Reduction
Bernanke expected to push deficit reduction in Friday congressional testimony, and beyond. W. Post: "He has made the case both publicly and in private conversations with lawmakers that developing a path to lower budget deficits over time could pay benefits now by increasing investor confidence in the future, and he is likely to make that idea a theme in public comments this year."
Defense Sec. Gates to meet with Congress on military budget cuts. W. Post: "Gates is scheduled to meet with congressional leaders Thursday to outline how he intends to save the $100 billion over the next five years by cutting weapons programs, Pentagon overhead costs and other portions of the Defense Department's massive bureaucracy ... His push to impose thriftiness on the Pentagon is part of a strategy to protect the military's budget from deficit hawks and others on Capitol Hill ... Gates has warned against cutting the level of defense spending, saying the Pentagon needs to increase its budget by a few percentage points each year to safeguard national security."
Economy Faces Myriad Of Challenges Despite Possible Job Boost
Report says nearly 300,000 private-sector jobs created in December. Newsday: "The private sector added 297,000 jobs nationwide in December, according to a report released Wednesday by the payroll firm ADP. But while the report caused a stir in some markets -- lifting the dollar, for example -- skeptics say it is just too good to be true ... Economists expect the Labor Department [tomorrow] to report a gain of about 150,000 jobs in December compared to November..."
Time puts possibly improving jobs picture in perspective: "None of this means that we're going back to an old-fashioned economy. One of the less attractive features of this job recovery is that it will be cruelly uneven. It will favor, more than ever, the college educated over blue collar workers. It will favor cities that have developed industry clusters in which skills match demand. It will favor the Dakotas over states such as Florida, Nevada and California. It will favor those who work in the private sector over those who work in the public sector."
Dean Baker notes that our housing bubble is still deflating: "The Case-Shiller 20-city house price index for October (the data is released with a two-month lag) showed a decline of 1.3% from September. This implied an acceleration from the prior month's decline, which is now reported as 1.0%. In other words, house prices are again declining at double-digit rates. A more careful examination of the data reveals the underlying logic. Prices are declining most rapidly in the bottom third of the market. Prices for this bottom tier of the market were in freefall in recent months in several cities ... If house prices drop by another 15%, completing the deflation of the housing bubble, this would imply a loss of $2.5tn in housing wealth. If consumers spend 6 cents for every dollar of housing wealth (near the middle of the range of estimates), this would mean a fall in consumption of roughly $150bn or 1% of GDP. This will be a substantial drag on growth over the next two years that will, no doubt, surprise most economists."
State governments lost 30% of their revenue in 2009. W. Post: "The severe drop in revenue resulted largely from the big investment losses experienced by state pension funds during the worst period of the downturn. Also, the report said, tax revenue slipped while surging demand from newly needy citizens drained the funds that back unemployment benefits, publicly funded health care and workers' compensation ... States' continued fiscal problems are projected to be a drag on the broader economic recovery as state payrolls are likely to shrink and state contracts to private companies are likely to be pared back."
BofA announces new fees in response to bans on unscrupulous practices. W. Post: "...consumers who carry low account balances would be subject to a $9 monthly maintenance fee. Meanwhile, those with at least $50,000 in deposits and investments would receive priority customer service and higher interest rates ... Banks have been scrambling to find new sources of revenue after a wave of legislation that brought changes to their consumer products. The new rules limit interest rate increases on credit cards, banned many overdraft charges and reduced the amount of money banks receive each time a debit card is swiped."
Bethany McLean argues getting rid of Fannie/Freddie means getting rid a low-cost 30-year fixed-rate mortgages, in NYT oped: "For a homeowner, a mortgage with a 30-year fixed rate (especially one that he can pay off early without a penalty) is a wonderful thing. For lenders and investors, however, it is a financial Frankenstein’s monster, an unnatural product filled with the potential for losses. Absorbing some of the risk of those losses is a large part of what the government does in the housing market."
Coal State Congresspeople Plan Anti-EPA Push
House may seek bipartisan bill to handcuff EPA on greenhouse gas regs. The Hill: "A senior coal-state Democrat is planning talks with House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) about proposals to halt EPA greenhouse gas rules. 'I hope we can find common ground,' [said] Rep. Nick Rahall ... Rahall has floated plans that would delay regulations for power plants, refineries and other stationary industrial plants for two years. Upton, in contrast, wants to nix EPA’s rules outright ..."
Coal state Sen. Jay Rockefeller will introduce anti-EPA bill soon. Politico: "The West Virginia Democrat told POLITICO that he’ll soon introduce the same piece of legislation he tried unsuccessfully to get a vote on throughout 2010. Rockefeller said he’d wanted to drop the bill at the start of the 112th Congress but was stymied by plans to spend the day debating changes to the Senate rules."
Mother Jones' Kate Sheppard reports that the official commission report on the BP Gulf oil spill says the disaster was avoidable: "The commission's chief counsel, Fred Bartlit, was careful to say in a pubic hearing last November that he did not see evidence that responsible parties on the rig had intentionally cut corners. But the final report does make it clear that the commission has concluded that BP, Halliburton, and Transocean all made decisions that saved time when there were less risky (and more time-consuming) alternatives available."
