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: Holding The Economy Hostage ... For 25 People
OurFuture.org's Richard Eskow: "Republicans are holding the entire country's budget hostage because they don't want to raise taxes on the wealthy, and they don't want to eliminate a tax loophole that could be bringing in more than $4 billion each year ... from only 25 people. The top 25 hedge fund managers in the United States collectively earned $22 billion last year, and yet they have their own cushy set of tax rules. If they operated under the same rules that apply to other people - police officers, for example, or teachers - the country could reduce its national debt by as much as $44 billion in the next ten years."
President Throws Down On Taxes
President calls out Republicans for being the only ones not compromising to avoid a debt crisis. NYT: "Mr. Obama cast the budget battle as a tug of war between the interests of the rich — like owners of corporate jets, who he said get generous tax breaks — and those of the middle class, the elderly and children. Directly challenging Republican leaders, Mr. Obama said, 'Everybody else has been willing to move off their maximalist position — they need to do the same.'"
Republicans remain protective of corporate jet owners. W. Post quotes Speaker Boehner: "“The votes simply aren’t there – and they aren’t going to be there, because the American people know tax hikes destroy jobs." "Speaker Boehner Can't Remember the 90s" notes Dean Baker.
Sen. McConnell makes excuses for protecting corporate jet tax loophole. LAT: "'The corporate plane tax hike that the president now wants would bring in about $3 billion in new taxes,' said Don Stewart, a spokesman for Senate Republican leader Mitch McConnell of Kentucky. 'The president wants hundreds of billions in new taxes. Where would they get the rest?'' Democrats have countered that its significance is symbolic, showing that Republicans refuse to consider even such obvious measures."
Politico lays out what Dems have already put on the table: "Already on the table are more than $1 trillion in discretionary 10-year spending cuts and hundreds of billions more in changes affecting farm subsidies, college aid and retirement benefits for federal workers. Additional savings from health care programs like Medicare and Medicaid are in the offing, as well as a potential $300 billion change in the government’s inflation calculator affecting Social Security benefits and some revenues. By almost any measure, it is a historic pivot...."
Senate Republicans launch drive for anti-jobs balanced budget amendment, moving away from compromise. W. Post: "The measure has no chance of finding Democratic support, and it would require spending cuts beyond anything under serious consideration." GOP will force Senate floor vote reports The Hill.
Bill Clinton proposes debt limit deal delaying spending cuts and tax increases, in ABC interview: "What I'd like to see them do is agree on the outlines of a 10-year plan and agree not to start either the revenue hikes or the spending cuts until we've got this recovery underway."
President Obama open to including new stimulus in debt limit deal. HuffPost: "... the president offered a preview of how congressional Democrats might ultimately agree to a debt-ceiling bill they may not philosophically support ... 'If there are steps in the short term [that] may reduce the amount of cash in the treasury but in the long term mean we are growing at 3.5 percent instead of 2.5 percent, then those ideas are worth exploring,' he said. As for what those 'ideas worth exploring' might be, White House Press Secretary Jay Carney has spoken about the president's support for 'targeted investments ... in education, in research and development, innovation and infrastructure' to be included in the debt ceiling package. Other administration officials have hinted that an infrastructure bank would be a logical add-on."
Defense cuts likely in any deal. The Hill: "As few as 30 House Republicans would likely consider voting against a debt-ceiling deal that cuts $300 billion from security spending, according to a GOP aide ... the GOP’s traditional opposition to reducing military spending has taken a backseat to warding off tax increases."
S&P will downgrade Treasury bonds to a "D" if debt limit not raised reports TPM.
Senate Budget Chair Conrad says Senate Dems have agreement on a major budget proposal. The Hill: "Conrad’s proposal, which he said he plans to introduce as soon as next week, would cut more than $4 trillion from the deficit, a greater reduction than what Obama’s fiscal commission had recommended ... The deal cannot cut Medicare benefits or slash Medicaid. It must raise tax revenues. It should make investments in infrastructure and green-energy technology to spur job growth. It should cut defense as well as domestic social spending."
Republican Judge Says Individual Mandate Is Constitutional
Republican appointed federal appeals court judge upholds Affordable Care Act's individual mandate. W. Post: "The decision [from the 6th Circuit] marked the first time a Republican-appointed judge has sided with the administration in evaluating the law’s constitutionality. ... 'We find that the minimum coverage provision is a valid exercise of legislative power by Congress under the Commerce Clause,' Judge Boyce F. Martin Jr., a Democratic appointee, wrote for the majority. He was joined by Republican appointee Jeffrey Sutton ... 'Congress had a rational basis to believe' that the provision would affect interstate commerce and that it was 'essential' to the law’s broader goals of reforming the health-care market."
Republican judge's concurrence cites recent Supreme Court precedent to shoot down conservative claims. TNR's Andrew Koppelman: "He also is oddly respectful of the bizarre and often-repeated claim that the commerce power applies only to individuals who are already engaged in commerce ... But he punctures it summarily, noting that the Supreme Court upheld regulation of medical marijuana even though Angel Raich, the defendant who grew her own medical marijuana, 'never entered any markets, whether interstate or intrastate.'"
GOPers May Throttle Trade Deals They Support
GOP may throw up obstacle to trade deals. W. Post: "...... on Wednesday House Majority Whip Kevin McCarthy (R-Calif.) issued the strongest statement yet that House leaders would seek to separate the TAA program [to aid displaced workers] from the trade deals ... If that happens, the Senate and the House could send competing versions of the trade pacts back to the White House, increasing the likelihood that the administration and Congress may further wrangle over them and that both chambers may fail to reach their goal of passing them before the August congressional recess."
President suggests Boeing and machinists union should settle NLRB case. WSJ: "[Said the President,] '...What I think defies common sense would be a notion that we would be shutting down a plant or laying off workers because labor and management can’t come to a sensible agreement.' ... Spokesmen at Boeing and the International Association of Machinists said they are open to settling the case, but each blamed the other for offering settlement proposals that weren’t serious."
Bank Lobby Sways Fed On Debit Cards
Fed scales back debit card fee caps. ABC: "The Fed acceded to a strong lobbying campaign by the banking industry and decided so-called 'swipe fees' should be capped at 21 cents per transaction, not the 12 cents it originally proposed. But that’s still less than half the average 44 cents merchants pay now."
The Fed caved, says Reuters' Felix Salmon: "The optics of this are terrible — the Fed hasn’t even attempted to justify the hike, and indeed no matter how many times you read its press release, you’ll never be able to see that there was any hike at all ... The message, here, is clear: keep on lobbying us! The more you lobby us, the more we’ll listen!"
HuffPost's Zach Carter reviews the history of the debit card battle: "The central bank initially proposed a 12-cent limit on those fees in December, following a Fed survey of banks that found that the median cost of processing a debit card transaction was 7 cents, with an average cost per swipe of 4 cents. The 12-cent cap would have left banks with a profit margin of about 70 percent on debit cards based on the median cost, but represented a reduction of almost 75 percent from the current average swipe fee of 44 cents per transaction. [Yesterday, the Fed] raised its proposed cap on swipe fees to 21 cents, plus 0.05 percent of the transaction amount and 1 cent to cover the costs of protecting against fraud. All told, the Fed said it will allow banks to charge a maximum of 24 cents per transaction, on average. That's actually higher than the current average amount that retailers pay for swipes that require customers to enter a personal identification number -- meaning PIN swipes are effectively exempted from the new rules."
