Each morning, Bill Scher and Terrance Heath serve up what progressives need to effect change on the kitchen-table issues families face: jobs, health care, green energy, financial reform, affordable education and retirement security.
MORNING MESSAGE: Bad Debt Limit Deal Could Crash Economy
OurFuture.org's Dave Johnson: "This infrastructure work has to be done anyway, no matter what. The longer we delay it the more our country falls behind. It is millions of jobs that need doing at a time when millions need jobs! The Republicans are demanding that we cut and gut our government and therefore our economy in exchange for keeping the country from defaulting on its debts. The deal they are demanding will do just as much harm as default. Instead we need to invest in We, the People with jobs and infrastructure that enable us to grow our way out of this mess."
Former WH Advisers Push For Stimulus
WH-led debt limit talks to intensify this week. The Hill: "...no one wants to contemplate what happens if there’s no sign of a debt-reduction deal by July 4. The dollar or capital markets, or both, could explode ... the Biden group will meet on three consecutive days this week, beginning Tuesday, and it is expected to keep up that pace until it hashes out a deal."
Former WH econ adviser Larry Summers calls for new stimulus, backs payroll tax cut, in Reuters oped: "The central irony of financial crisis is that while it is caused by too much confidence, borrowing and lending, and spending, it is only resolved by increases in confidence, borrowing and lending, and spending ... it is a false economy to defer infrastructure maintenance and replacement, and instead take advantage of a moment when 10-year interest rates are below 3 percent and construction unemployment approaches 20 percent to expand infrastructure investment ... Substantial withdrawal of fiscal support for demand at the end of 2011 would be premature. Fiscal support should be continued and indeed expanded by providing the payroll tax cut to employers as well as employees. Raising the share of the payroll tax cut from 2 percent to 3 percent would be desirable as well."
Another former WH adviser, Jared Bernstein, proposes potentially politically feasible jobs program: "...repair, insulate, and green-up the nation’s public schools. The benefits range from good jobs in a sector with very high unemployment, energy savings, a great public service for one of society’s key institutions, and this kind of thing has even been found to reduce racial test score gaps."
Robert Kuttner warns Dems against a bad debt limit deal: "In the most likely budget compromise that saves the country from defaulting on the national debt, the differences between the parties will collapse in a largely conservative direction. If the current script is followed, Republicans will be the big winners. They will win on gutting social spending, aborting a fragile recovery, humbling the president, and undercutting his re-election chances ... The entire political class has convinced itself that the way to economic recovery is via deficit reduction. The only problem with that is that no known theory of economics can plausibly demonstrate the connection."
Former GOP Sen. Judd Gregg warns his party against insisting on balanced budget amendment. "Does anyone really believe this is a viable option when the threats we face from excessive spending, deficits and debts mount on a yearly basis at astronomical rates? Do we have time for this type of an exercise, which is heavily weighted towards public relations, not progress?"
Robert Reich sees lack of urgency in Washington on jobs: "...I made the rounds of Washington Democrats, repeatedly asking why no bold jobs plan is emerging ... what struck me most was the similarity between [GOP Sen. Richard] Shelby's overall attitude and that of the Democrats I talked with -- a kind of shrug of the shoulders, a sense that it's really not all that bad out there, and that nothing can be done anyway."
WH lacks hard numbers to tout green jobs successes, argues Politico: "Monthly Labor Department employment reports say nothing about the new clean energy workforce, while an effort to document how many Americans actually make a living in the 'green collar' field may not be done by November 2012 ... White House officials say asking about the connection between the 9.1 percent unemployment rate and the administration's concerted green jobs campaign is the wrong question. A better benchmark, they say, is the exponential growth in clean technology industries ... The White House figures 825,000 Americans should be building electric car batteries, retrofitting homes or doing other green collar work by the end of 2012. But that too is an extrapolation."
Michael Tomasky counsels President to pin the economic blame on GOP: "It can give in to congressional Republicans' demands for trillions of dollars in spending cuts in exchange for a debt-ceiling vote ... Or it can fight the Republicans and dare them to refuse to raise the limit. But these Republicans are crazy enough to do just that ... They can at least tell the American people that while they're doing this for the sake preventing a wrecked economy, the cuts are far too severe [and] that the Republicans don't care if the economy is destroyed as long as it takes down the president with it."
First GOP Debate With All Top Candidates Tonight
Pawlenty signals he's going after Romney tonight. LAT: "... Pawlenty lumped Romney's state plan with Obama's federal healthcare overhaul under the acerbic moniker 'Obamneycare.' ... Pawlenty appeared to be positioning himself on an aggressive track heading into Monday night's New Hampshire debate, which will be the first to feature Romney..."
Romney signals he's going after Obama on jobs, launches web ad accusing President of trivializing unemployed.
GOP candidates tout "Six Sigma" management technique to save money, ignore that government already uses it. TNR's Brad Plumer: "...the EPA has an entire section detailing the virtues of Six Sigma—along with a slew of other in-vogue management techniques. It’s not as if federal employees have never given any thought to how to improve government efficiency—or that once Pawlenty rolls into the White House with a few consulting buzzwords he learned second-hand, improvements will materialize like magic, and whole agencies will become significantly leaner overnight. While there’s no doubt always room to do better, a lot of this stuff is already being done."
NY, DE Take On Big Banks, Foreclosure Fraud
NY and DE attorneys general open up new front in forecloure fraud investigation. NYT: "Their effort centers on the back end of the mortgage assembly lines — where big banks serve as trustees overseeing the securities for investors ... The attorneys general have requested information from Bank of New York Mellon and Deutsche Bank, the two largest firms acting as trustees. Trustee banks have not been a focus of other investigations ... But as administrators they were required to ensure that the documentation was proper and complete."
NY AG also opening up new line of inquiry into Bank of America's foreclosure record. HuffPost: "New York Attorney General Eric Schneiderman has targeted Bank of America .. in a new probe that questions the validity of potentially thousands of mortgage securities and their associated foreclosures ... [The] investigation of defective mortgage practices comes on the heels of public reports that Bank of America systematically failed to transfer essential documents to other entities in the daisy chain that turned home loans into securities to be sold on Wall Street."
President Looks To Win Back Wall St. Support
President Obama working to regain past support from Wall Street. NYT: "The president’s top financial industry supporters say they are confident that the support Mr. Obama needs will ultimately be there, despite the financial industry’s unhappiness over his efforts to tighten regulation of their businesses. But it is clear that those supporters will have to work much harder to win over the financial services industry than they did in 2008, before Wall Street’s bust, the subsequent clashes over policy and the sometimes bitter personal differences that lingered afterward."
Mark Thoma laments: "The unemployed are really unhappy too. And unlike Wall Street executives they actually have a legitimate reason to complain. But ... they don't have gobs of money to contribute to a reelection campaign ... The interests of the unemployed are not always the same as the interests of the financial community. Deficit reduction, for example, is favored by the financial community as insurance against financial market problems but it could hurt the ability of the economy to create jobs."
More Medicare Needed, Not Less
NYT's Paul Krugman why raising eligibility age for Medicare is going in the wrong direction: "... Medicare actually saves money — a lot of money — compared with relying on private insurance companies. And this in turn means that pushing people out of Medicare, in addition to depriving many Americans of needed care, would almost surely end up increasing total health care costs ... while it’s true that Medicare has done an inadequate job of controlling costs, the private sector has done much worse ... Both Medicare and private insurance will be unsustainable unless there are major cost-control efforts — the kinds of efforts that are actually in the Affordable Care Act, and which Republicans demagogued with cries of 'death panels.'"
President eyes "judge-directed negotiation" as alternative to malpractice suits. NYT: "Getting judges involved earlier, more often and much more actively in pushing for settlements ... New York officials say the program bypasses years of court battles, limiting legal costs while providing injured patients with compensation that is likely to be less than a jury would award but can be paid out years earlier, without lengthy appeals. Under a $3 million federal grant, the city courts are now expanding the program beyond the Bronx, where it started in cases against city hospitals, to courts in Brooklyn and Manhattan, as well as to cases against private hospitals. It is to begin in Buffalo courts in the fall."
Breakfast Sides
WH begins internal Afghan debate to determine next steps. LAT: "President Obama is expected to announce next month the size and pace of a drawdown he promised in December 2009 ... Obama has given few hints on which way he is leaning, but the ground may be shifting in favor of a much smaller military footprint ... with Washington focused on trimming the federal deficit, the White House is coping with a wave of public frustration over a conflict that is costing $120 billion a year."
WH makes contingency plans as Congress not expected to pass reforms to No Child Left Behind. Politico: "...the Obama administration is preparing a backup plan that would give states regulatory relief from some of the law’s provisions... in exchange for significant reform ... [There is] fear that if Congress does not act in the next few years, nearly all American schools will be deemed 'failures' by No Child under a controversial provision of the law and lose federal funding ... The [House] committee is next slated to take up a so-called flexibility bill, which would allow school administrators to take federal money designated for one part of their budget to use for another area if the need is greater ... Democrats worry such a measure would lack proper oversight and could starve essential programs if abused."
