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: Exporting Our (Bank) Values To Afghanistan
OurFuture.org's Richard Eskow: "The Kabul Bank story is a sad inversion of nation-building. It might have provided some moments of black humor for the recession-ravaged middle class, if only Americans and Afghans weren't paying for it with their lives. We promised to teach the Afghans everything we know about running a modern economy. Apparently we did."
More Grandstanding, Little Honesty On Spending Cuts
McCaskill-Corker spending cut bill fails to spell out what to cut. Time's Alex Altman: "..., the Commitment to American Prosperity (CAP) Act puts forth aggressive deficit-reduction goals without pinpointing how to meet them. The measure would cap discretionary and mandatory spending at a declining level of GDP over the next 10 years, pushing spending levels down from the current level (24% of GDP) to 20.6% ... But the bill says nothing about what should be cut and what shouldn't ... Paul Van de Water, of the liberal Center for Budget and Policy Priorities, argues that it would be 'virtually impossible to maintain federal spending at its average level for decades back to 1970 without making draconian cuts in Social Security, Medicare, and an array of other vital federal activities.'"
Reid rejects bill, reports The Hill.
"A lazy and silly way to budget," argues Wonk Room's Pat Garofalo: "... McCaskill and Corker’s cap would actually hold federal spending below the level at which it was under President Reagan, even though there are now tens of millions more seniors reliant on Social Security and Medicare than there were in the 1980′s."
Senate Budget Cmte may adopt Simpson-Bowles outline. Politico: "Under [Chair Kent] Conrad’s scenario, the annual spring budget resolution would be expanded to 10 years and effectively adopt deficit reduction targets set by the commission. Within these parameters, Conrad has discussed allowing a free-wheeling debate in the committee to build a bipartisan consensus on how to meet these goals. A second, parallel effort, led by Sens. Saxby Chambliss (R-Ga.) and Mark Warner (D-Va.), seeks to transform the commission’s report into real legislation that could be debated—and amended—but would give senators a comprehensive plan as a starting point.
GOP Sen. Tom Coburn pressing military to audit its books or face cuts. HuffPost quotes: "I will continue to push for a budget-freeze of all base budget non-military personnel accounts at the Defense Department until it complies with the law regarding auditable financial statements."
Dean Baker urges US to learn from Britain's failed austerity experiment: "...the predictable result of austerity is slower growth and higher unemployment. The UK has volunteered to be our guinea pig and test this proposition. For now, it looks like things are going just as standard economic theory predicts..."
Mark Thoma debunks claim that deficit steals from our grandchildren, in Fiscal Times oped: "When the government incurs debt, the important factor to consider is what the government does with the money relative to what the private sector would have done with it ... With government goods such as bridges, roads, water systems and so on, the high return to both present and future generations is easy to see ... Future generations benefit greatly from having social services infrastructure in place, and in many ways this type of infrastructure is harder to construct than physical infrastructure."
NJ Gov. insults public employees who insist state honor pension contracts. Bloomberg: "New Jersey Governor Chris Christie said he doesn’t mind breaking promises to pensioners to close a $10.5 billion budget deficit -- even if they sue. 'I have bigger issues than who sues me ... Get in line.' Public workers in Colorado, South Dakota and Minnesota are already suing their states ... The key to whether existing benefits can be cut will be language that determines if a pension is a legal contract and when the agreement becomes property ..."
President's focus on investing in science isn't enough, argues W. Post's Katrina vanden Heuvel: "We live in a country with nearly 15 million unemployed, and many millions more underemployed. A country where job creation can barely keep pace with population growth, where for a staggering number of people, the pain of recession continues without any real relief. These are people who cannot wait for a decade-long economic transformation; they need relief - and jobs - now."
Senate Takes Up Health Reform Repeal Today
Senate GOP will force vote on health reform repeal today. The Hill: "McConnell offered the repeal as an amendment to the Federal Aviation Administration (FAA) reauthorization bill Tuesday afternoon ... Sen. Joe Manchin of West Virginia, a freshman Democrat facing reelection in 2012, told The Hill he would not support repeal despite his vocal criticism of the law’s individual mandate to buy insurance ... Reid agreed on Tuesday to allow the procedural vote on repeal because Republicans did not filibuster the motion to proceed for the FAA bill ... Democrats plan to raise a budget point-of-order objection to McConnell’s amendment by citing a Congressional Budget Office (CBO) estimate that repeal would add $230 billion to the federal deficit."
Some states may suspend implementation of health reform law ... or just act like it. NYT: "...in a few states that are party to the litigation, Republican governors and attorneys general ... suggested they would suspend planning and implementation until appeals courts could rule, although they did not provide details about what precisely might change or whether they would refund federal planning grants already awarded ... But Democratic governors tended to echo Gov. Peter Shumlin of Vermont, who said his state was 'moving ahead at full speed' ... And in many states, even Republican officials who are party to the lawsuit chose to tread cautiously."
Conservative activist judge used legal brief from hate group as basis for throwing out health reform law. Wonk Room's Igor Volsky: "The only thing more surprising than Judge Roger Vinson’s decision to invalidate the entire Affordable Care Act on the basis of a single provision that does not got into effect until 2014 is his reliance on the Family Research Council’s brief to do so ... The brief’s author, Ken Klukowski, has his own questionable history. [He has] accused the Federal Reserve of waging a war against Christmas and attacked Obama for trying to 'control' children’s minds."
Former Reagan Solicitor General Charles Fried says health reform is constitutional. Time: "Since 1944, Fried says, the Supreme Court has held that the insurance industry counts as commerce and is subject to congressional regulation. 'That is clear and I am convinced of it. The challengers are saying, "Ah, yes, but this is not simply regulating insurance; it's requiring you to buy insurance." I don't know where the distinction comes from ... But where does it say that when you regulate commerce you may not regulate conduct that is part of that activity?'"
Threat of law's invalidation panicking the seriously ill. NYT: "... Hillary St. Pierre, a 28-year-old former registered nurse who has Hodgkin’s lymphoma, had expected to reach her insurance plan’s $2 million limit this year. Under the new law, the cap was eliminated ... she does not know what she will do if the cap is reinstated ..."
New Bills Blast EPA
House GOP to introduce bill today banning EPA from regulating greenhouse gas emissions. AP: "...the bill would nullify all of the steps the EPA has taken to date on the issue, including a threshold finding that greenhouse gases constitute a danger to the public health and welfare ... it seeks to strip the agency of its authority to use the law in any future attempts to crack down on the emissions ... A vote on the greenhouse gases bill would occur first in the Energy and Commerce Committee, and is expected later this winter..."
7 Senate Dems back 2-year ban against EPA action on climate. Mother Jones' Kate Sheppard: "West Virginia Democrat Sen. Jay Rockefeller on Tuesday re-introduced his legislation ... Democrats Jim Webb (Va.), Claire McCaskill (Mo.), Tim Johnson (SD), Joe Manchin (W.Va.), Ben Nelson (Neb.) and Kent Conrad (ND) have signed on as co-sponsors ... The real threat now is that the litany of bills from Republicans will serve to make Rockefeller's time-out look like the modest proposal..."
Report argues auto industry will fall short of President's goal of 1M electric cars by 2015 under current policy. W. Post: " ... many automakers have balked at making the investments to mass produce plug-in vehicles ... GM has announced it will produce up to 45,000 Chevrolet Volts in 2012. Nissan has indicated it will sell about 25,000 Leafs in the United States this year ... [But] under existing laws, sales for both companies could drop after each one sells 200,000 plug-in cars, because at that point the $7,500 federal tax-credit incentive for purchases expires. New bills in Congress would lift the cap on the tax incentive from 200,000 to 500,000 per manufacturer."
Oil spill bill deal in the works. The Hill: "The likely compromise, first outlined by [Sens.] Begich and Landrieu last year, involves creating a mutual insurance pool into which drillers in the Gulf pay. The pool will help cover part of the economic damages in the event of a spill."
U.S. Chamber of Commerce attacks President's plan for compromise clean energy standard. Wonk Room's Brad Johnson: "Christopher Guith, vice president for policy at the chamber’s Institute for 21st Century Energy, said a national clean-energy standard is 'ridiculously premature,' even though 25 states have renewable and alternative energy standards, the first established in 1983."
"Administration working to streamline offshore wind leasing" reports The Hill.
Fed Shoulders Bulk Of Blame
Crisis commission primarily blames Fed. Politico's Ben White: "The FCIC report concludes the crisis was largely the result of poor mortgage-lending standards, which were, in turn, the fault of the Fed ... The report hardly stops there, laying a litany of blame at the feet of the central bank going back two decades ... when people say the FCIC majority report didn’t really pick a main villain in the financial crisis, don’t believe it."
"Fed Officially Abandons Plan To Gut Predatory Lending Rule" reports HuffPost: "Principal regulatory authority on the issue will now shift to the new Consumer Financial Protection Bureau, which is not expected to revive the earlier Fed proposal."
Consumer Financial Protection Bureau's Holly Petraeus warns banks to follow the law for military customers. W. Post: "The letter comes on the heels of reports that some banks have violated those provisions, including an acknowledgment last month by J.P. Morgan Chase that the firm had foreclosed on more than a dozen active-service families and overcharged thousands of others. The bank said it would refund a total of about $2 million to overcharged families."
Investors go bust with firm at center of foreclosure fraud scandal. NYT: "...the back-office processing operations of [David J.] Stern’s law firm were converted into a publicly traded company called DJSP Enterprises. Mr. Stern pocketed nearly $60 million from that transaction ... As the Florida attorney general’s office continues to investigate whether Mr. Stern’s law firm falsified documents in order to speed up foreclosures, the firm has lost its biggest clients ... Shares of the company, which were worth $14 apiece last summer, trade now for about 50 cents ... DJSP faces a lawsuit from investors who claim they were misled about its financial prospects..."
Breakfast Sides
Corporate America's "hit list" of regulations found in investigation requests to GOP Rep. Darrell Issa. Huffington Post: "The Huffington Post has reviewed 40 letters from over 160 groups, representing the full spectrum of the nation's industries ... Most of the complaints in the letters cite proposed rules and regulations and only a few name rules that are already on the books ... Almost half of the letters viewed by HuffPost complain about proposals to regulate greenhouse gas emissions and to strengthen the nation's ambient air quality standard..."
China expected to raise interest rates to lessen inflation. NYT: "...higher interest rates and tighter restrictions on bank loans, could begin to slow segments of China’s domestic economy slightly — particularly the breakneck pace of investment [which] could weaken demand for industrial materials like steel and copper ... One policy change Beijing is unlikely to take soon is letting the currency, the renminbi, appreciate faster ... Lately, Chinese and American policy makers have been looking at the so-called real effective exchange rate, which includes differences in the two countries’ inflation levels ... Geithner, has said that this real exchange rate is showing that Chinese exporters already face rising costs as they try to stay competitive in the United States market."
W. Post suggests skills gap cause of jobs crisis: "...that 39 percent increase in job openings has not been accompanied by a corresponding decline in the unemployment rate, which now stands at 9.4 percent - the same as it was in July 2009." Dean Baker retorts: "It presents comments from one employer who complains that he can't find workers for jobs that pay $15 an hour. This is not a very good wage ... If the company president understand economics, then he would raise wages enough so that the jobs were attractive to workers who have the necessary skills."
