Todd S. Purdum on Sarah Palin: vanityfair.com
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Tuesday, June 30, 2009
Does The Obama Plan for Reforming Wall Street Measure Up? by Robert Reich
Does the Obama Plan for Reforming Wall Street Measure Up?
In a word: No.
The plan doesn't stop stop bankers from making huge, risky bets with other peoples’ money. It does increase capital requirements and oversight, but it doesn't require bankers to take their pay in long-term stock options or warrants, and it doesn't even hint that banks should go back to being partnerships instead of publicly-held corporations.
All this means traders still have very incentive to place big and often wildly risky bets as long as the potential winnings are big enough, and top executives have very little incentive to monitor what traders are up to as long as the traders are collecting large commissions on the bets.
Nor does the plan do anything to prevent banks from becoming too big to fail. It doesn't hint at a return to the days before the late 1990s when commercial banks were separate entities from investment banks -- before mammoth bank supermarkets like Citigroup came to be so tied up with so many other commercial and investment vehicles that they couldn't be allowed to go under. And there's not the slightest mention of antitrust, to break up the largest banks.
The plan does focus on a few conflicts of interest, such as how credit rating agencies are paid. And it does establish a new agency to oversee all forms of consumer loans -- thereby helping make sure borrowers know what they're getting into, and can comparison shop. But these are small potatoes relative to the size of the overall problem. The Fed is given new oversight powers, but there's no suggestion that regional Fed bank presidents, who already have a substantial oversight role, should be recruited from the ranks of people who are not bankers and don't have a big financial stake in keeping oversight to a minimum.
In short: It's a mere filigree of reform, a sheer gossamer of government. Wall Street must be toasting its good fortune. Unless Congress shows some spine, the great Wall Street meltdown of 2007 and 2008 -- which lead to the biggest taxpayer bailout in history, very likely the largest taxpayer losses on record, and the largest investor losses since 1929 -- will repeat itself within a decade, if not sooner.
In fact, the banks that have repaid their TARP money are already planning to resume supersize bonuses, even though many of them are still awash in toxic assets and their non-performing loans are up. Bad credit-card and commercial property debts are mounting. Foreclosures are soaring. Yet several of the big banks are showing profits. How are they pulling this off? First, they strong-armed the Financial Accounting Standards Board into allowing them to assign whatever value they wanted to all the junk on their balance sheets. Then they played hardball with the Treasury staffers whose so-called "stress tests" lapsed into little more than negotiations over numbers and probabilities. (The national unemployment rate is already approaching the highest unemployment rate in the stress tests.) Then they convinced investors that financials have hit bottom and were now good bets. Presto!
Watch your wallets. The Street is up to its old tricks. And the White House's so-called reform is little more than a whitewash.
posted by Robert Reich | 8:00 AM
In a word: No.
The plan doesn't stop stop bankers from making huge, risky bets with other peoples’ money. It does increase capital requirements and oversight, but it doesn't require bankers to take their pay in long-term stock options or warrants, and it doesn't even hint that banks should go back to being partnerships instead of publicly-held corporations.
All this means traders still have very incentive to place big and often wildly risky bets as long as the potential winnings are big enough, and top executives have very little incentive to monitor what traders are up to as long as the traders are collecting large commissions on the bets.
Nor does the plan do anything to prevent banks from becoming too big to fail. It doesn't hint at a return to the days before the late 1990s when commercial banks were separate entities from investment banks -- before mammoth bank supermarkets like Citigroup came to be so tied up with so many other commercial and investment vehicles that they couldn't be allowed to go under. And there's not the slightest mention of antitrust, to break up the largest banks.
The plan does focus on a few conflicts of interest, such as how credit rating agencies are paid. And it does establish a new agency to oversee all forms of consumer loans -- thereby helping make sure borrowers know what they're getting into, and can comparison shop. But these are small potatoes relative to the size of the overall problem. The Fed is given new oversight powers, but there's no suggestion that regional Fed bank presidents, who already have a substantial oversight role, should be recruited from the ranks of people who are not bankers and don't have a big financial stake in keeping oversight to a minimum.
In short: It's a mere filigree of reform, a sheer gossamer of government. Wall Street must be toasting its good fortune. Unless Congress shows some spine, the great Wall Street meltdown of 2007 and 2008 -- which lead to the biggest taxpayer bailout in history, very likely the largest taxpayer losses on record, and the largest investor losses since 1929 -- will repeat itself within a decade, if not sooner.
In fact, the banks that have repaid their TARP money are already planning to resume supersize bonuses, even though many of them are still awash in toxic assets and their non-performing loans are up. Bad credit-card and commercial property debts are mounting. Foreclosures are soaring. Yet several of the big banks are showing profits. How are they pulling this off? First, they strong-armed the Financial Accounting Standards Board into allowing them to assign whatever value they wanted to all the junk on their balance sheets. Then they played hardball with the Treasury staffers whose so-called "stress tests" lapsed into little more than negotiations over numbers and probabilities. (The national unemployment rate is already approaching the highest unemployment rate in the stress tests.) Then they convinced investors that financials have hit bottom and were now good bets. Presto!
Watch your wallets. The Street is up to its old tricks. And the White House's so-called reform is little more than a whitewash.
posted by Robert Reich | 8:00 AM
Sunday, June 28, 2009
GOP Continues Abandoning Republican Voters
GOP Continues Abandoning Republican Voters
June 25, 2009 5:05 pm ET by Matt Finkelstein
It seems the GOP is intent on purging anyone who doesn't adhere to their rigid ideology.
With the House preparing to vote on the American Clean Energy and Security Act, congressional Republicans have stepped up their efforts to smear the Democrats' cap-and-trade bill. However, Greg Sargent points out that the GOP's opposition is not only at odds with the American people, which at this point is par for the course, but also with a significant number of Republican voters. According to the Washington Post:
Debate over the cap-and-trade approach has focused on the cost to the average American. The Congressional Budget Office estimated this week that cap and trade would cost the average U.S. household $175 a year in 2020, but House Republicans have pushed the message that the legislation would cost many times that and drive millions of jobs offshore.
That message has failed to sway liberal and moderate Republicans, 60 percent of whom back a cap-and-trade program, but it appeals to the party's conservative base.
Moreover, while the GOP has drawn a line in the sand opposing a public health care option, fully 50 percent of their followers -- and 73 percent of independents -- support a public plan. Matt Yglesias provides this nifty visual underlining how out of touch the Republican leadership is on health care:
As Sargent notes, it's no wonder that "38% of Republicans and GOP-leaners view the party unfavorably." But rather than winning them back, it seems the GOP is intent on purging anyone who doesn't adhere to their rigid ideology.
–Matt Finkelstein
Organizations: GOP
Issues: Health Care
Energy
Climate
House Passes Climate Change Bill
House passes climate change bill
By: Lisa Lerer and Patrick O'Connor
June 25, 2009 08:43 PM EST
Democrats narrowly passed historic climate and energy legislation Friday evening that would transform the country’s economy and industrial landscape.
But the all-hands-on-deck effort to protect politically vulnerable Democrats by corralling the minimum number of votes to pass the bill, 219-212, proves that there are limits to President Barack Obama's ability to use his popularity to push through his legislative agenda. Forty-four Democrats voted against the bill, while just eight Republicans crossed the aisle to back it.
Despite the tough path to passage, the legislation is a significant win for House Speaker Nancy Pelosi (D-Ca.) and the bill’s two main sponsors – House Energy and Commerce committee chairman Henry Waxman (D-Ca.) and Massachusetts Rep. Edward Markey (D) – who modified the bill again and again to get skeptical members from the Rust Belt, the oil-producing southeast and rural Midwest to back the legislation.
“We passed transformational legislation which takes us into the future,” Pelosi said at a press conference following the vote, after she and other leaders took congratulatory phone calls from Obama, former Vice President Al Gore and Senate Majority Leader Harry Reid.
“It has been an incredible six months, to go from a point where no one believed we could pass this legislation to a point now where we can begin to say that we are going to send president Obama to Copenhagen in December as the leader of the of the world on climate change,” said Markey, referring to world climate talks scheduled this winter.
After months of negotiations, 211 Democrats and eight Republicans voted for the bill of more than 1,200 pages, setting the legislation on a path towards the Senate. There, it faces a far more uncertain future given the opposition of key moderates and the already-heated battle over health care.
Republicans are sure to try and use against other Democrats in 2010, with accusations that they raised electricity bills for already-strapped consumers in the midst of a deep recession.
Indeed, the National Republican Congressional Committee wasted little time before blasting out a press release targeting more than two dozen Democrats for supporting “Democrats’ ongoing crusade against economic recovery.”
“I’m in a tough spot. I really am,” Rep. John Salazar (D-Colo.), one of the Democrats who opposed the bill, said before the vote, citing his fears the legislation could raise energy costs and hurt the coal industry in his low-income, rural district.
“Either way I’m going to get creamed.”
Democratic leadership attempted to protect their most vulnerable freshman by cajoling yes votes from more senior members such as Lloyd Doggett of Texas.
Doggett announced his change of heart from “strong objection” earlier in the day during the final stage of the floor debate.
Doggett told POLITICO that he made his switch after speaking to Obama and having lengthy conversations with Waxman, Markey, Gore and Pelosi, but ultimately, he decided to support the bill so he could have a seat at the negotiating table when California Sen. Barbara Boxer introduces it in the Senate later this summer.
“It has been a difficult and significant decision,” Doggett said. “I just decided that I will have a better chance to make changes later in the process if I acted in good faith now. But don't think this means I'm signing off on the conference report,” he said.
When the bill passed, the chamber erupted in applause, and colleagues shook Markey and Waxman's hands. Even some Republicans clapped, mocking the Democrats for casting what they deemed a politically unpopular vote.
The vote itself proceeded with much less drama than hung in the chamber for most of the day leading up to the much anticipated roll call; Democrats looked relieved and Republicans resigned as they watched votes register on the big board above the House floor. Fence-sitting Republicans such as Washington Rep. Dave Reichert and New Jersey Rep. Leonard Lance waited to vote “yes” on the bill, in a game of chicken with moderate Democrats.
Many of those moderate Democrats, like freshman Rep. Bobby Bright of Alabama, also waited until the end of the roll call to cast votes against the package.
In the end, Democrats had the votes they needed, and many veteran moderates were able to cast votes against the bill without hanging junior Democrats out to dry. One possible exception – Maryland Rep. Frank Kratovil, a freshman – accepted handshakes from colleagues after casting an early vote in favor of the package.
The debate leading up to the vote was nevertheless intense.
Democrats touted the legislation as a measure that would improve national security, create jobs, protect the environment and reestablish the United States as a world leader. Republicans slammed the bill as an economic catastrophe.
“I look forward to spending the next 100 years trying to fix this legislation,” said California Republican Brian Bilbray.
“This is the biggest job killing bill that’s ever been on the floor of the House of Representatives. Right here, this bill,” said House Minority Leader John Boehner. “And I don’t think that’s what the American people want.”
Donning reading glasses, Boehner then delayed the roll call vote by reading page-by-page through a 300-page managers’ amendment Democrats added at around 3 a.m. on Friday. Boehner seemed to relish the hour-long stunt, picking out the bill’s most obscure language and then pontificating about what it might – or might not – mean. Republicans laughed along with him and roared with applause when he was done.
The complex bill mandates a 17-percent cut in greenhouse gas emissions by 2020 and a 83-percent cut by 2050, reductions that will be accomplished by putting a price on carbon dioxide through a cap-and-trade system. It mandates that 20 percent of electricity comes from renewable sources and increased energy efficiency by 2020. And the legislation gives electric utilities, coal plants, energy-intensive manufacturers, farmers, petroleum refiners, and other industries special protections to help them transition to new, less-fossil fuel-intensive ways of doing business.
It will also raise electricity prices for consumers by $175 a year per household by 2020, according to a report by the Congressional Budget Office, significantly less than the $3,000 price hike predicted by Republicans who say the “energy tax” will increase energy bills and the cost of consumer goods.
Obama praised the House for taking a “bold and necessary step,” then wasted no time in turning up the heat on the upper chamber. “Now it's up to the Senate to take the next step. And I'm confident that in the coming weeks and months the Senate will demonstrate the same commitment to addressing what is a tremendous challenge and an extraordinary opportunity,” he said in a statement.
The White House played a significant role in drumming up support for the legislation, which is a key piece of the administration’s first-year agenda. The administration is under pressure to make significant progress towards cutting greenhouse gas emissions before the Copenhagen international climate talks next December.
A long list of Cabinet secretaries, key staffers and even Obama himself lobbied undecided members. Gore, the don of the climate-change world, spent several days calling on the fence lawmakers.
The legislation spilt both the environmental and business communities. Although environmentalists have pushed for stricter controls on greenhouse-gas emissions for more than a decade, more left-wing groups like Greenpeace wanted stronger emissions reductions and fewer protections for greenhouse-gas guzzling industries like coal. While some electric utilities, auto manufacturers, and Fortune 500 companies supported the bill, large business associations like the Chamber of Commerce argued that it would impose a crippling regulatory burden on the economy that would push factories and jobs abroad.
The House chamber took on the feeling of a momentous vote on Friday, with lobbyists, administration officials and even the stray senator –in this case, Udall – working the hallways off the floor to convince fence sitters in one direction or another. After the rule vote, Markey quickly collared Holt for a brief conversation.
“We are fond of seeing headlines that say this is the Democrats’ toughest challenge yet,” said House Whip James Clyburn, tweaking the media’s hyperbole. “Well, today that what quite true.”
He joined many other Democrats in giving the ultimate credit to Pelosi making the difference on the vote.
“Nancy Pelosi was the whip on this,” he said.
-- Victoria McGrane contributed to this story.
© 2009 Capitol News Company, LLC
FD HIDDEN DIV
By: Lisa Lerer and Patrick O'Connor
June 25, 2009 08:43 PM EST
Democrats narrowly passed historic climate and energy legislation Friday evening that would transform the country’s economy and industrial landscape.
But the all-hands-on-deck effort to protect politically vulnerable Democrats by corralling the minimum number of votes to pass the bill, 219-212, proves that there are limits to President Barack Obama's ability to use his popularity to push through his legislative agenda. Forty-four Democrats voted against the bill, while just eight Republicans crossed the aisle to back it.
Despite the tough path to passage, the legislation is a significant win for House Speaker Nancy Pelosi (D-Ca.) and the bill’s two main sponsors – House Energy and Commerce committee chairman Henry Waxman (D-Ca.) and Massachusetts Rep. Edward Markey (D) – who modified the bill again and again to get skeptical members from the Rust Belt, the oil-producing southeast and rural Midwest to back the legislation.
“We passed transformational legislation which takes us into the future,” Pelosi said at a press conference following the vote, after she and other leaders took congratulatory phone calls from Obama, former Vice President Al Gore and Senate Majority Leader Harry Reid.
“It has been an incredible six months, to go from a point where no one believed we could pass this legislation to a point now where we can begin to say that we are going to send president Obama to Copenhagen in December as the leader of the of the world on climate change,” said Markey, referring to world climate talks scheduled this winter.
After months of negotiations, 211 Democrats and eight Republicans voted for the bill of more than 1,200 pages, setting the legislation on a path towards the Senate. There, it faces a far more uncertain future given the opposition of key moderates and the already-heated battle over health care.
Republicans are sure to try and use against other Democrats in 2010, with accusations that they raised electricity bills for already-strapped consumers in the midst of a deep recession.
Indeed, the National Republican Congressional Committee wasted little time before blasting out a press release targeting more than two dozen Democrats for supporting “Democrats’ ongoing crusade against economic recovery.”
“I’m in a tough spot. I really am,” Rep. John Salazar (D-Colo.), one of the Democrats who opposed the bill, said before the vote, citing his fears the legislation could raise energy costs and hurt the coal industry in his low-income, rural district.
“Either way I’m going to get creamed.”
Democratic leadership attempted to protect their most vulnerable freshman by cajoling yes votes from more senior members such as Lloyd Doggett of Texas.
Doggett announced his change of heart from “strong objection” earlier in the day during the final stage of the floor debate.
Doggett told POLITICO that he made his switch after speaking to Obama and having lengthy conversations with Waxman, Markey, Gore and Pelosi, but ultimately, he decided to support the bill so he could have a seat at the negotiating table when California Sen. Barbara Boxer introduces it in the Senate later this summer.
“It has been a difficult and significant decision,” Doggett said. “I just decided that I will have a better chance to make changes later in the process if I acted in good faith now. But don't think this means I'm signing off on the conference report,” he said.
When the bill passed, the chamber erupted in applause, and colleagues shook Markey and Waxman's hands. Even some Republicans clapped, mocking the Democrats for casting what they deemed a politically unpopular vote.
The vote itself proceeded with much less drama than hung in the chamber for most of the day leading up to the much anticipated roll call; Democrats looked relieved and Republicans resigned as they watched votes register on the big board above the House floor. Fence-sitting Republicans such as Washington Rep. Dave Reichert and New Jersey Rep. Leonard Lance waited to vote “yes” on the bill, in a game of chicken with moderate Democrats.
Many of those moderate Democrats, like freshman Rep. Bobby Bright of Alabama, also waited until the end of the roll call to cast votes against the package.
In the end, Democrats had the votes they needed, and many veteran moderates were able to cast votes against the bill without hanging junior Democrats out to dry. One possible exception – Maryland Rep. Frank Kratovil, a freshman – accepted handshakes from colleagues after casting an early vote in favor of the package.
The debate leading up to the vote was nevertheless intense.
Democrats touted the legislation as a measure that would improve national security, create jobs, protect the environment and reestablish the United States as a world leader. Republicans slammed the bill as an economic catastrophe.
“I look forward to spending the next 100 years trying to fix this legislation,” said California Republican Brian Bilbray.
“This is the biggest job killing bill that’s ever been on the floor of the House of Representatives. Right here, this bill,” said House Minority Leader John Boehner. “And I don’t think that’s what the American people want.”
Donning reading glasses, Boehner then delayed the roll call vote by reading page-by-page through a 300-page managers’ amendment Democrats added at around 3 a.m. on Friday. Boehner seemed to relish the hour-long stunt, picking out the bill’s most obscure language and then pontificating about what it might – or might not – mean. Republicans laughed along with him and roared with applause when he was done.
The complex bill mandates a 17-percent cut in greenhouse gas emissions by 2020 and a 83-percent cut by 2050, reductions that will be accomplished by putting a price on carbon dioxide through a cap-and-trade system. It mandates that 20 percent of electricity comes from renewable sources and increased energy efficiency by 2020. And the legislation gives electric utilities, coal plants, energy-intensive manufacturers, farmers, petroleum refiners, and other industries special protections to help them transition to new, less-fossil fuel-intensive ways of doing business.
It will also raise electricity prices for consumers by $175 a year per household by 2020, according to a report by the Congressional Budget Office, significantly less than the $3,000 price hike predicted by Republicans who say the “energy tax” will increase energy bills and the cost of consumer goods.
Obama praised the House for taking a “bold and necessary step,” then wasted no time in turning up the heat on the upper chamber. “Now it's up to the Senate to take the next step. And I'm confident that in the coming weeks and months the Senate will demonstrate the same commitment to addressing what is a tremendous challenge and an extraordinary opportunity,” he said in a statement.
The White House played a significant role in drumming up support for the legislation, which is a key piece of the administration’s first-year agenda. The administration is under pressure to make significant progress towards cutting greenhouse gas emissions before the Copenhagen international climate talks next December.
A long list of Cabinet secretaries, key staffers and even Obama himself lobbied undecided members. Gore, the don of the climate-change world, spent several days calling on the fence lawmakers.
The legislation spilt both the environmental and business communities. Although environmentalists have pushed for stricter controls on greenhouse-gas emissions for more than a decade, more left-wing groups like Greenpeace wanted stronger emissions reductions and fewer protections for greenhouse-gas guzzling industries like coal. While some electric utilities, auto manufacturers, and Fortune 500 companies supported the bill, large business associations like the Chamber of Commerce argued that it would impose a crippling regulatory burden on the economy that would push factories and jobs abroad.
The House chamber took on the feeling of a momentous vote on Friday, with lobbyists, administration officials and even the stray senator –in this case, Udall – working the hallways off the floor to convince fence sitters in one direction or another. After the rule vote, Markey quickly collared Holt for a brief conversation.
“We are fond of seeing headlines that say this is the Democrats’ toughest challenge yet,” said House Whip James Clyburn, tweaking the media’s hyperbole. “Well, today that what quite true.”
He joined many other Democrats in giving the ultimate credit to Pelosi making the difference on the vote.
“Nancy Pelosi was the whip on this,” he said.
-- Victoria McGrane contributed to this story.
© 2009 Capitol News Company, LLC
FD HIDDEN DIV
Saturday, June 27, 2009
Pelosi's Moment
Pelosi's moment
By: MARTIN KADY II on June 26, 2009 @ 7:12 AM
The climate change bill may be known as the “Waxman-Markey” legislation.
But Friday’s expected vote is all on Speaker Nancy Pelosi — it may be the biggest test of her leadership as she tries to wrestle votes on a massive cap-and-trade bill from reticent moderates and farm state lawmakers. Insiders expect it to pass — but not comfortably. And the moment politically vulnerable Democrats go home, they can be sure to face a barrage of attack ads about voting for what Republicans have called a “national energy tax.”
Good Friday morning and welcome to The Huddle — brought to you today from Danvers, Mass. — where we’ll be watching the climate change roll call vote as closely as any vote in recent memory on the House floor today, looking for breakaway Democrats to cause trouble for their leader.
Also driving the agenda in Washington on a day when the rest of the world is mourning the death of the King of Pop: A potential Senate deal on health care; an uncomfortable confrontation between David Obey and Maxine Waters; and a veto threat over the F-22.
CLIMATE CHANGE CRESCENDO: With the big vote looming, Democrats are still a bit short, as Patrick O’Connor and Lisa Lerer report: “Democratic leaders are working furiously to corral votes for a controversial climate change measure, hoping to build a big enough margin so that vulnerable Democrats can be freed to vote against it.
“At the White House on Thursday, President Barack Obama declared: “Now is the time to act.” Former Vice President Al Gore, who had planned to rally Democrats en masse in Washington, stayed home in Tennessee so he could press members one by one via telephone. House Speaker Nancy Pelosi plied undecided members with chocolate-covered Dove bars in a series of small group meetings. …By late Thursday, aides and lawmakers said Democrats were within a dozen of the 218 votes needed to pass the legislation.”
THE $1T QUESTION: How to pay for it and how much it costs have always been the critical question on health reform. Jackie Calmes take in today’s New York Times: “It has become the trillion-dollar question: can President Obama find that much in spending cuts and tax increases to keep his campaign promise to overhaul the health care system, without adding to already huge deficits? Mr. Obama and the Democrats running Congress are deeply split over the possibilities.”
SENATE DEAL? Yet the Washington Post’s Lori Montgomery and Shailagh Murray report that Senate negotiators are near a deal: “Senate health-care negotiators said yesterday they were closing in on a $1 trillion health-care bill that would be fully funded by tax increases, Medicare cuts and new penalties for employers who do not offer health insurance.
“Senate Finance Committee Chairman Max Baucus (D-Mont.) said members of the panel would consider a menu of policy and financing options over the Fourth of July recess, with the goal of producing a deficit-neutral 10-year bill shortly after Congress returns July 6. "We're getting a lot closer to an agreement," Baucus told reporters after the committee reviewed new Congressional Budget Office cost estimates yesterday.”
By: MARTIN KADY II on June 26, 2009 @ 7:12 AM
The climate change bill may be known as the “Waxman-Markey” legislation.
But Friday’s expected vote is all on Speaker Nancy Pelosi — it may be the biggest test of her leadership as she tries to wrestle votes on a massive cap-and-trade bill from reticent moderates and farm state lawmakers. Insiders expect it to pass — but not comfortably. And the moment politically vulnerable Democrats go home, they can be sure to face a barrage of attack ads about voting for what Republicans have called a “national energy tax.”
Good Friday morning and welcome to The Huddle — brought to you today from Danvers, Mass. — where we’ll be watching the climate change roll call vote as closely as any vote in recent memory on the House floor today, looking for breakaway Democrats to cause trouble for their leader.
Also driving the agenda in Washington on a day when the rest of the world is mourning the death of the King of Pop: A potential Senate deal on health care; an uncomfortable confrontation between David Obey and Maxine Waters; and a veto threat over the F-22.
CLIMATE CHANGE CRESCENDO: With the big vote looming, Democrats are still a bit short, as Patrick O’Connor and Lisa Lerer report: “Democratic leaders are working furiously to corral votes for a controversial climate change measure, hoping to build a big enough margin so that vulnerable Democrats can be freed to vote against it.
“At the White House on Thursday, President Barack Obama declared: “Now is the time to act.” Former Vice President Al Gore, who had planned to rally Democrats en masse in Washington, stayed home in Tennessee so he could press members one by one via telephone. House Speaker Nancy Pelosi plied undecided members with chocolate-covered Dove bars in a series of small group meetings. …By late Thursday, aides and lawmakers said Democrats were within a dozen of the 218 votes needed to pass the legislation.”
THE $1T QUESTION: How to pay for it and how much it costs have always been the critical question on health reform. Jackie Calmes take in today’s New York Times: “It has become the trillion-dollar question: can President Obama find that much in spending cuts and tax increases to keep his campaign promise to overhaul the health care system, without adding to already huge deficits? Mr. Obama and the Democrats running Congress are deeply split over the possibilities.”
SENATE DEAL? Yet the Washington Post’s Lori Montgomery and Shailagh Murray report that Senate negotiators are near a deal: “Senate health-care negotiators said yesterday they were closing in on a $1 trillion health-care bill that would be fully funded by tax increases, Medicare cuts and new penalties for employers who do not offer health insurance.
“Senate Finance Committee Chairman Max Baucus (D-Mont.) said members of the panel would consider a menu of policy and financing options over the Fourth of July recess, with the goal of producing a deficit-neutral 10-year bill shortly after Congress returns July 6. "We're getting a lot closer to an agreement," Baucus told reporters after the committee reviewed new Congressional Budget Office cost estimates yesterday.”
Obama equals Immigration Bill
Obama: Immigration bill coming soon
By: Amie Parnes
June 25, 2009 06:19 PM EST
President Obama vowed on Thursday to immediately begin negotiations to craft comprehensive immigration reform, with the goal of passing legislation in Congress later this year or early next year.
In a meeting with Democratic and Republican lawmakers, Obama said all parties at the table were far from reaching consensus on an immigration overhaul, but he said they were in agreement that the current system is “broken and needs fixing.”
Obama said his administration has already taken steps to make the border more secure. But he said the American public is not yet convinced that immigration problems — including illegal border crossings, undocumented workers and the stress they put on public services such as health care and education — can be fixed.
“It’s going to require some heavy lifting, it’s going to require a victory or practicality and common sense and good policy making over short-term politics,” he said.
Some immigration reform advocates, who gave Obama strong backing in his election campaign and have expressed concern that the topic has been overtaken by other administration priorities, said they were gratified that the issue now seems to be on the agenda.
“We see the meeting today as ringing the opening bell on comprehensive immigration reform,” said Clarissa Martinez, director of immigration and national campaigns for the National Council of La Raza, a Latino advocacy group. “The economy and health care have always been issues that are essential, but we believe that you can do more than one thing at one time.”
Sen. Charles Schumer (D-N.Y.), who is expected to introduce the immigration legislation in the coming months, called Thursday’s meeting “a real shot in the arm.”
In the hour-long meeting at the White House, Obama praised John McCain (R-Ariz.), his opponent in the 2008 presidential election who often bucked the GOP by calling for immigration reform, saying he “has already paid a significant political cost for doing the right thing. I stand with him.”
But Obama’s immigration plans lately have received stiff resistance from McCain, who opposes new demands laid down by labor unions.
The AFL-CIO joined the immigration coalition for the first time this year, on the condition that a proposed temporary guest worker program for future immigrant workers would not be part of the bill. Instead, the labor unions have proposed the creation of a federal commission that would adjust the number of worker visas each year based on economic conditions.
McCain told reporters after attending Thursday’s meeting that he could not support a proposal that doesn’t include a legal temporary worker program.
“I would expect the President of the United States to put his influence on the unions in order to change their position, then I think we can proceed with negotiations,” McCain said. “Without a commitment…there is no such thing as comprehensive immigration reform.”
Sen. Mel Martinez, R-Fla., a strong advocate of the comprehensive bill, said he was disappointed that Obama didn’t respond to the concerns about the temporary worker program during the meeting.
But Cecilia Munoz, the White House Intergovernmental Affairs director, said Obama intentionally “did not get into the policy weeds,” during the meeting.
“The goal of this is to have Janet Napolitano work with a bipartisan group to design a policy and strategy,” Munoz said.
While some Democrats have openly argued with the White House’s contention that there are not enough votes in Congress right now to pass a bill, Republicans in the meeting sided with the White House, saying they were skeptical that a bill could win passage.
“I think the votes in the Senate a little dicey at the moment. I don’t think it can pass today,” Martinez said, because of the disagreement over temporary workers. McCain also said the bill could not pass the Senate because the American public is not yet certain that the borders are secure.
But Sen. Lindsey Graham (R-S.C.) said a solution must be found because of the nation’s changing demographics. “We’ve got one more chance to do this,” Graham said. “If we fail this time, no politician is going to take this up for a generation, and that would be a shame for this country.”
POLITICO contributor Gebe Martinez assisted in this report.
© 2009 Capitol News Company, LLC
By: Amie Parnes
June 25, 2009 06:19 PM EST
President Obama vowed on Thursday to immediately begin negotiations to craft comprehensive immigration reform, with the goal of passing legislation in Congress later this year or early next year.
In a meeting with Democratic and Republican lawmakers, Obama said all parties at the table were far from reaching consensus on an immigration overhaul, but he said they were in agreement that the current system is “broken and needs fixing.”
Obama said his administration has already taken steps to make the border more secure. But he said the American public is not yet convinced that immigration problems — including illegal border crossings, undocumented workers and the stress they put on public services such as health care and education — can be fixed.
“It’s going to require some heavy lifting, it’s going to require a victory or practicality and common sense and good policy making over short-term politics,” he said.
Some immigration reform advocates, who gave Obama strong backing in his election campaign and have expressed concern that the topic has been overtaken by other administration priorities, said they were gratified that the issue now seems to be on the agenda.
“We see the meeting today as ringing the opening bell on comprehensive immigration reform,” said Clarissa Martinez, director of immigration and national campaigns for the National Council of La Raza, a Latino advocacy group. “The economy and health care have always been issues that are essential, but we believe that you can do more than one thing at one time.”
Sen. Charles Schumer (D-N.Y.), who is expected to introduce the immigration legislation in the coming months, called Thursday’s meeting “a real shot in the arm.”
In the hour-long meeting at the White House, Obama praised John McCain (R-Ariz.), his opponent in the 2008 presidential election who often bucked the GOP by calling for immigration reform, saying he “has already paid a significant political cost for doing the right thing. I stand with him.”
But Obama’s immigration plans lately have received stiff resistance from McCain, who opposes new demands laid down by labor unions.
The AFL-CIO joined the immigration coalition for the first time this year, on the condition that a proposed temporary guest worker program for future immigrant workers would not be part of the bill. Instead, the labor unions have proposed the creation of a federal commission that would adjust the number of worker visas each year based on economic conditions.
McCain told reporters after attending Thursday’s meeting that he could not support a proposal that doesn’t include a legal temporary worker program.
“I would expect the President of the United States to put his influence on the unions in order to change their position, then I think we can proceed with negotiations,” McCain said. “Without a commitment…there is no such thing as comprehensive immigration reform.”
Sen. Mel Martinez, R-Fla., a strong advocate of the comprehensive bill, said he was disappointed that Obama didn’t respond to the concerns about the temporary worker program during the meeting.
But Cecilia Munoz, the White House Intergovernmental Affairs director, said Obama intentionally “did not get into the policy weeds,” during the meeting.
“The goal of this is to have Janet Napolitano work with a bipartisan group to design a policy and strategy,” Munoz said.
While some Democrats have openly argued with the White House’s contention that there are not enough votes in Congress right now to pass a bill, Republicans in the meeting sided with the White House, saying they were skeptical that a bill could win passage.
“I think the votes in the Senate a little dicey at the moment. I don’t think it can pass today,” Martinez said, because of the disagreement over temporary workers. McCain also said the bill could not pass the Senate because the American public is not yet certain that the borders are secure.
But Sen. Lindsey Graham (R-S.C.) said a solution must be found because of the nation’s changing demographics. “We’ve got one more chance to do this,” Graham said. “If we fail this time, no politician is going to take this up for a generation, and that would be a shame for this country.”
POLITICO contributor Gebe Martinez assisted in this report.
© 2009 Capitol News Company, LLC
Jeb Bush for President in 2012 ?
Jeb Bush for President in 2012? After Sanford, Ensign Etc., It's Not Impossible
June 26, 2009 05:32 PM ET | John Aloysius Farrell
By John Aloysius Farrell, Thomas Jefferson Street blog
It's looking highly likely that the 2012 Republican presidential nominee will be a retread.
With Gov. Mark Sanford at wit's end, and Sen. John Ensign joining Sanford at adultery camp, and Gov. Jon Huntsman going to China, and Gov. Bobby Jindal flopping in his first big national TV appearance, and Gov. Mitch Daniels saying he doesn't want to be president, and Gov. Sarah Palin running such an undisciplined operation up there in Alaska, the prospect for fresh blood is thinning.
We got some old party leaders from down South—Gov. Haley Barbour and former House Speaker Newt Gingrich—and a couple of former governors who couldn't beat John McCain last time out—Mitt Romney and Mike Huckabee.
And then there is Jeb.
Yes, my friends. It is sad but true. We have not seen the end of the Bush dynasty yet.
Two things must happen for Americans to forget George W. Bush's awful performance, and let his brother Jeb have a turn in the Oval Office. First, a lot of other GOP contenders must self-destruct. Second, Barack Obama has to fail spectacularly.
The Republican hopefuls are doing their part.
So now it's time to see how nasty the old hands from the Bush administration get. Watch them carefully in the coming months. From W on down, the more the Bushies rip Obama, the more they are thinking Jeb in 2012.
June 26, 2009 05:32 PM ET | John Aloysius Farrell
By John Aloysius Farrell, Thomas Jefferson Street blog
It's looking highly likely that the 2012 Republican presidential nominee will be a retread.
With Gov. Mark Sanford at wit's end, and Sen. John Ensign joining Sanford at adultery camp, and Gov. Jon Huntsman going to China, and Gov. Bobby Jindal flopping in his first big national TV appearance, and Gov. Mitch Daniels saying he doesn't want to be president, and Gov. Sarah Palin running such an undisciplined operation up there in Alaska, the prospect for fresh blood is thinning.
We got some old party leaders from down South—Gov. Haley Barbour and former House Speaker Newt Gingrich—and a couple of former governors who couldn't beat John McCain last time out—Mitt Romney and Mike Huckabee.
And then there is Jeb.
Yes, my friends. It is sad but true. We have not seen the end of the Bush dynasty yet.
Two things must happen for Americans to forget George W. Bush's awful performance, and let his brother Jeb have a turn in the Oval Office. First, a lot of other GOP contenders must self-destruct. Second, Barack Obama has to fail spectacularly.
The Republican hopefuls are doing their part.
So now it's time to see how nasty the old hands from the Bush administration get. Watch them carefully in the coming months. From W on down, the more the Bushies rip Obama, the more they are thinking Jeb in 2012.
The Task Of Taming Highs and Lows by Jon Hilsenrath
The Task of Taming Highs and Lows
By JON HILSENRATH
WASHINGTON -- The proposed regulatory revamp is setting out to do what history suggests can't be done easily -- tame the financial system's tendency to drive itself off a cliff.
The objective of "stability" is all over President Obama's plans. The word shows up 53 times in his 88-page blueprint. His proposal, if approved by Congress, would make banks hold more capital in reserve for a rainy day, reducing funds available for making risky bets. It would require mortgage originators to hold a piece of the loans they sell, and the plan would steer compensation for a wide range of players away from risky practices.
Financial booms and busts have become especially familiar in the past quarter century. But until the credit squeeze that started in 2007, they seemed to have become more benign. The 1987 stock-market crash, the savings-and-loan debacle of the late 1980s, emerging-market crises of the 1990s and the tech bust early this decade came and went leaving only two modest U.S. recessions in their wake.
The current recession has emphasized to Mr. Obama and his economic team the threat that unstable financial markets pose to the broader economy. Lawrence Summers, Mr. Obama's chief economic adviser, speaks often about creating a new foundation for a less-bubble-driven economy.
"Over the past two decades, we have seen, time and again, cycles of precipitous booms and busts," Mr. Obama said Wednesday. "In each case, millions of people have had their lives profoundly disrupted by developments in the financial system, most severely in our recent crisis."
The Federal Reserve would stand at the center of the effort, with new power to regulate financial institutions that threaten broader stability. The Fed will have the power to cast a watchful eye beyond banks, to insurance companies or other too-big-to-fail firms, and will be expected to be alert to how their exposures might ripple through the system.
Derivatives markets that had been left to police themselves, on the premise that they help make the financial system more resilient, would no longer be left to do so. The Fed also is examining whether it can do more to deflate financial bubbles before they get too big. For many years officials felt it was sufficient to clean up after a bubble burst -- the idea has now been discredited.
"The thrust of this reform proposal is to insulate the system when and if the next bubble happens and then bursts," said Robert Litan, a scholar at the Brookings Institution. "The hope is that the next time around there will be some warnings."
One important cause of the credit bubble hasn't been addressed by Mr. Obama -- the large trade imbalance between the U.S. and China. It produced a flood of dollars pouring into US markets from abroad during the credit boom, propping up debt markets. But that can't be regulated away.
The challenge with a regulator revamp is doing it without stifling Wall Street innovation or the economy's growth. Some Obama administration officials call it the "elusive frontier."
"We must recognize that the singular pursuit of stability, however well-intentioned, may end up making our economy less productive, less adaptive, and less self-correcting -- and in so doing, less able to deliver on its alluring promise," Kevin Warsh, a Federal Reserve governor and former administration official under George W. Bush, said in a speech this week.
Another problem is that of unintended consequences. Regulators toughened capital requirements on banks after the S&L crisis, which encouraged the growth of a "shadow" banking system populated by unregulated financial institutions and markets. A Great Depression restriction on the ability of banks to pay interest on deposits, called Regulation Q, sometimes left them squeezed for funds and forced them to tighten credit.
This time, tougher restrictions on banks or insurance companies could push money further into less-regulated markets, such as private equity, hedge funds or institutions offshore.
Administration officials are conscious of the risk. One pillar of their plan is improving international cooperation on financial regulation. They also want to force hedge funds and other private money players to register with the Securities and Exchange Commission. But the White House isn't talking about imposing the same kinds of capital and liquidity requirements on many of them that it would for banks, meaning hedge funds could remain a path of least resistance for investors looking to avoid heavy regulation.
There also is a risk that officials, in responding to the last crisis, will miss the next one. Congress responded to the tech bust and accounting scandals of earlier this decade by passing Sarbanes-Oxley accounting regulations. But the current crisis was already brewing in housing, not stocks.
"The next problem is not going to be mortgage-backed securities," says Raghuram Rajan, a finance professor at the University of Chicago Booth School of Business. "It is going to be something else."
Mr. Rajan holds up Citigroup Inc. and its predecessor companies as an example of the pitfalls of regulating financial institutions. Citi "found three ways of getting itself into trouble in the last three decades," he notes. In the 1980s, it became burdened by emerging-market debt that had gone bad. In the 1990s, it was overexposed to commercial real estate. And in the last crisis, it suffered huge losses in residential mortgages.
"You can sharpen enforcement in one area, increase regulation, but if the underlying incentive to take excessive risk is not mitigated in some way, it is going to move somewhere else," Mr. Rajan says.
For that reason, White House officials want the Fed to be able to oversee the compensation policies of top executives at big financial institutions, to make sure they don't create perverse incentives. Clamping down on compensation could send Wall Street's best and brightest to some new area of finance nobody has yet thought of.
Write to Jon Hilsenrath at jon.hilsenrath@wsj.com
Printed in The Wall Street Journal, page A12
By JON HILSENRATH
WASHINGTON -- The proposed regulatory revamp is setting out to do what history suggests can't be done easily -- tame the financial system's tendency to drive itself off a cliff.
The objective of "stability" is all over President Obama's plans. The word shows up 53 times in his 88-page blueprint. His proposal, if approved by Congress, would make banks hold more capital in reserve for a rainy day, reducing funds available for making risky bets. It would require mortgage originators to hold a piece of the loans they sell, and the plan would steer compensation for a wide range of players away from risky practices.
Financial booms and busts have become especially familiar in the past quarter century. But until the credit squeeze that started in 2007, they seemed to have become more benign. The 1987 stock-market crash, the savings-and-loan debacle of the late 1980s, emerging-market crises of the 1990s and the tech bust early this decade came and went leaving only two modest U.S. recessions in their wake.
The current recession has emphasized to Mr. Obama and his economic team the threat that unstable financial markets pose to the broader economy. Lawrence Summers, Mr. Obama's chief economic adviser, speaks often about creating a new foundation for a less-bubble-driven economy.
"Over the past two decades, we have seen, time and again, cycles of precipitous booms and busts," Mr. Obama said Wednesday. "In each case, millions of people have had their lives profoundly disrupted by developments in the financial system, most severely in our recent crisis."
The Federal Reserve would stand at the center of the effort, with new power to regulate financial institutions that threaten broader stability. The Fed will have the power to cast a watchful eye beyond banks, to insurance companies or other too-big-to-fail firms, and will be expected to be alert to how their exposures might ripple through the system.
Derivatives markets that had been left to police themselves, on the premise that they help make the financial system more resilient, would no longer be left to do so. The Fed also is examining whether it can do more to deflate financial bubbles before they get too big. For many years officials felt it was sufficient to clean up after a bubble burst -- the idea has now been discredited.
"The thrust of this reform proposal is to insulate the system when and if the next bubble happens and then bursts," said Robert Litan, a scholar at the Brookings Institution. "The hope is that the next time around there will be some warnings."
One important cause of the credit bubble hasn't been addressed by Mr. Obama -- the large trade imbalance between the U.S. and China. It produced a flood of dollars pouring into US markets from abroad during the credit boom, propping up debt markets. But that can't be regulated away.
The challenge with a regulator revamp is doing it without stifling Wall Street innovation or the economy's growth. Some Obama administration officials call it the "elusive frontier."
"We must recognize that the singular pursuit of stability, however well-intentioned, may end up making our economy less productive, less adaptive, and less self-correcting -- and in so doing, less able to deliver on its alluring promise," Kevin Warsh, a Federal Reserve governor and former administration official under George W. Bush, said in a speech this week.
Another problem is that of unintended consequences. Regulators toughened capital requirements on banks after the S&L crisis, which encouraged the growth of a "shadow" banking system populated by unregulated financial institutions and markets. A Great Depression restriction on the ability of banks to pay interest on deposits, called Regulation Q, sometimes left them squeezed for funds and forced them to tighten credit.
This time, tougher restrictions on banks or insurance companies could push money further into less-regulated markets, such as private equity, hedge funds or institutions offshore.
Administration officials are conscious of the risk. One pillar of their plan is improving international cooperation on financial regulation. They also want to force hedge funds and other private money players to register with the Securities and Exchange Commission. But the White House isn't talking about imposing the same kinds of capital and liquidity requirements on many of them that it would for banks, meaning hedge funds could remain a path of least resistance for investors looking to avoid heavy regulation.
There also is a risk that officials, in responding to the last crisis, will miss the next one. Congress responded to the tech bust and accounting scandals of earlier this decade by passing Sarbanes-Oxley accounting regulations. But the current crisis was already brewing in housing, not stocks.
"The next problem is not going to be mortgage-backed securities," says Raghuram Rajan, a finance professor at the University of Chicago Booth School of Business. "It is going to be something else."
Mr. Rajan holds up Citigroup Inc. and its predecessor companies as an example of the pitfalls of regulating financial institutions. Citi "found three ways of getting itself into trouble in the last three decades," he notes. In the 1980s, it became burdened by emerging-market debt that had gone bad. In the 1990s, it was overexposed to commercial real estate. And in the last crisis, it suffered huge losses in residential mortgages.
"You can sharpen enforcement in one area, increase regulation, but if the underlying incentive to take excessive risk is not mitigated in some way, it is going to move somewhere else," Mr. Rajan says.
For that reason, White House officials want the Fed to be able to oversee the compensation policies of top executives at big financial institutions, to make sure they don't create perverse incentives. Clamping down on compensation could send Wall Street's best and brightest to some new area of finance nobody has yet thought of.
Write to Jon Hilsenrath at jon.hilsenrath@wsj.com
Printed in The Wall Street Journal, page A12
Thursday, June 25, 2009
Perry Signs Windstorm Bill
Governor Rick Perry was in Corpus Christi, Texas yesterday to sign into law the “windstorm insurance bill”, or HB4409. Speaking to a crowd of hundreds, Perry lauded the bipartisan efforts of the Corpus Christi legislative delegation, Sen. Juan “Chuy” Hinojosa, Rep. Todd Hunter, Rep. Abel Herrero and Rep. Solomon Ortiz Jr.“This legislation addresses a number of issues that have made it tough for insurance companies to remain engaged along the Texas coast, making it difficult for citizens to get the windstorm coverage they need and exerting upward pressure on insurance premiums across the state,” said Governor Perry, in a prepared statement.
The legislation will insure up to $2.5 billion in losses and will loosen up restrictions on funding for recovery.
Florence Shapiro Highest Name Recognition for US Senate
Shapiro Has Highest Name ID Among Announced GOP Candidates
PLANO, TX – A new poll released Monday by Global Strategy Group (GSG) confirms that State Senator Florence Shapiro is the most well-known candidate among the four Republicans who have announced their intention to seek the United States Senate seat currently held by Kay Bailey Hutchison.
Hutchison’s term expires in 2012; she has said this will be her last term and that she may resign early to run for Texas Governor in 2010.
According to the survey, a full quarter of likely special election voters are familiar with Shapiro – more than twice the percentage of voters who are familiar with the next best-known Republican currently running or exploring a campaign for U.S. Senate. Shapiro enjoys a +8% net favorability rating, which is also higher than any other Republican candidate who has taken public steps toward a Senate run.
Announced GOP U.S. Senate Candidate
Name ID / Net Favorability Rating
Florence Shapiro
25% / +8%
Michael Williams
11% / +4%
Roger Williams
9% / +3%
Elizabeth Ames Jones
8% / +5%
“These numbers continue a trend of positive poll results for Senator Shapiro’s exploratory committee,” said Andy Seré, Shapiro’s campaign manager. “Florence has a proven record of fighting for Texas and for her constituents in the Metroplex as a city councilmember, Mayor and state Senator. Her solid base of support as reflected in these results is a testament to the strength and appeal of that record.”
The news of Shapiro’s healthy name ID is only the latest indication of the momentum her exploratory committee has steadily generated.
Shortly after she launched her exploratory committee, Shapiro rolled out the support of a majority of her Republican State Senate colleagues, nearly twenty GOP State Representatives, four former Texas Federation of Republican Women Presidents, Dallas Businessman and Hall of Famer Roger Staubach, and hundreds of Texans from across the state. At the end of 2008, Shapiro announced a fundraising haul exceeding $500,000 since beginning her exploratory campaign in July. And a Public Policy Polling survey in late February 2009 showed Shapiro beating out Democratic Houston Mayor Bill White in a head-to-head U.S. Senate matchup.
“Texas is a vast state and a long campaign lies ahead,” Shapiro said. “But I am thrilled with the position my campaign is in and the progress we’ve made since commencing our exploratory efforts.”
The GSG poll (attached) was conducted March 30-April 1, 2009 and surveyed 603 likely special election voters via live telephone interviews. Its margin of error is +/- 4.0%.
--------------------------------------------------------------------------------
Article printed from Texas Insider: http://www.texasinsider.org
Wednesday, June 24, 2009
The GOP can Stop Obamacare by Karl Rove
By KARL ROVE
It's extremely unlikely that Republicans will be able to pass their own health-care plan in this Congress. But in politics you can't beat something with nothing, so it is critical that the GOP offers an alternative to President Barack Obama's government-run monstrosity.
Americans will listen more closely to Republicans if they make empirical and specific arguments against Mr. Obama's attempted government takeover of the nation's health system. But they must also offer proposals that families, small-businesspeople and health-care providers will applaud.
Associated Press
President Barack Obama before delivering remarks on health care reform at the annual meeting of the American Medical Association on Monday in Chicago.
Fortunately, Sens. Tom Coburn of Oklahoma and Richard Burr of North Carolina, and Reps. Paul Ryan of Wisconsin and Devin Nunes of California have devised a plan that will likely appeal to anyone interested in making health insurance more affordable and portable.
Their proposal -- called the Patients' Choice Act -- is to leave in place the tax deduction companies receive for providing employees with health insurance and to create a "Medi-Choice" tax rebate that will give individuals $2,200 and families $5,700 to spend on health insurance.
The rebate will make health insurance more affordable, especially for young people. It also will make health insurance portable, which will free people from being locked into jobs they hate because they are afraid of losing their health insurance.
The Coburn-Ryan plan also helps the hard-to-insure and chronically ill because it shares their risk across all insurance companies, providing lower premiums than they might find now. It would help those in Medicaid because they receive private insurance rather than being forced into a one-size-fits-all government program in which doctors are increasingly refusing to participate.
About Karl Rove
Karl Rove served as Senior Advisor to President George W. Bush from 2000–2007 and Deputy Chief of Staff from 2004–2007. At the White House he oversaw the Offices of Strategic Initiatives, Political Affairs, Public Liaison, and Intergovernmental Affairs and was Deputy Chief of Staff for Policy, coordinating the White House policy making process.
Before Karl became known as "The Architect" of President Bush's 2000 and 2004 campaigns, he was president of Karl Rove + Company, an Austin-based public affairs firm that worked for Republican candidates, nonpartisan causes, and nonprofit groups. His clients included over 75 Republican U.S. Senate, Congressional and gubernatorial candidates in 24 states, as well as the Moderate Party of Sweden.
Karl writes a weekly op-ed for The Wall Street Journal, is a Newsweek columnist and is now writing a book to be published by Simon & Schuster. Email the author at Karl@Rove.com or visit him on the web at Rove.com.
Or, you can send him a Tweet @karlrove.
The House GOP also formed a Health Care Solutions Group that unveiled proposals yesterday. The group wanted to make health care more affordable, expand availability, and promote healthier life choices. It did this by proposing two-dozen ways to improve existing law to make it easier and more cost-effective to buy health insurance.
One proposal is to give families who purchase their own insurance a tax benefit similar to the one companies get for providing health benefits. Another proposal is to pass medical liability reforms that will reduce costly junk lawsuits. Still another would allow small businesses to team up to buy insurance at a group discount. The group also wants to allow families to save money tax-free for a wide range of health expenses and permit children to stay on their parents' policies until age 25.
Under the group's proposals, Medicaid beneficiaries would get the flexibility to choose private coverage, rather than being locked into a government-run program. The group is also calling for stepping up efforts to detect and punish Medicare and Medicaid fraud, which costs an estimated $60 billion a year.
Individual Republicans are also stepping forward with health-reform ideas, such as creating a national health-insurance market that would allow Americans to buy insurance across state lines. Sens. Jon Kyl (R., Ariz.) and Lamar Alexander (R., Tenn.) have offered other ideas, including expanding community health centers.
This is the first time congressional Republicans as a group have been comfortable talking about health care. It may be the product of necessity, but it is also necessary to get a robust debate on health-care reform.
Republican efforts will be helped by a recent Congressional Budget Office report that found that Sen. Ted Kennedy's health-care reform would cost at least $1 trillion over the next 10 years and still leave 36 million Americans uninsured (it may be slightly more once all the details are released). Estimates for the health-care bill that the Senate Finance Committee is drafting with help from the White House are coming in around $1.6 trillion over 10 years.
As the debate now shifts from broad generalities to the specifics of how health-care reform would work and how the government will pay for it, the GOP has an opportunity to stop the nationalization of the health-care industry. The more scrutiny it gets, the less appealing Obama-Care will become. And the more Democrats have to talk about creating a new value-added tax or junk food taxes to pay for it, the more Americans will recoil.
Republican credibility on health care depends on whether the party offers positive alternatives that build on the strengths of American medicine. As long as the choice was between reform and the status quo, the public was likely to go with the reformers. But if the debate is whether to go with costly, unnecessary reforms or with common-sense changes, then Republicans have a chance to appeal to fiscally conservative independents and Democrats and win this one. It is still possible to stop ObamaCare in its tracks. If Republicans can do that, they will win public confidence on an issue that will dominate politics for decades.
Mr. Rove is the former senior adviser and deputy chief of staff to President George W. Bush.
It's extremely unlikely that Republicans will be able to pass their own health-care plan in this Congress. But in politics you can't beat something with nothing, so it is critical that the GOP offers an alternative to President Barack Obama's government-run monstrosity.
Americans will listen more closely to Republicans if they make empirical and specific arguments against Mr. Obama's attempted government takeover of the nation's health system. But they must also offer proposals that families, small-businesspeople and health-care providers will applaud.
Associated Press
President Barack Obama before delivering remarks on health care reform at the annual meeting of the American Medical Association on Monday in Chicago.
Fortunately, Sens. Tom Coburn of Oklahoma and Richard Burr of North Carolina, and Reps. Paul Ryan of Wisconsin and Devin Nunes of California have devised a plan that will likely appeal to anyone interested in making health insurance more affordable and portable.
Their proposal -- called the Patients' Choice Act -- is to leave in place the tax deduction companies receive for providing employees with health insurance and to create a "Medi-Choice" tax rebate that will give individuals $2,200 and families $5,700 to spend on health insurance.
The rebate will make health insurance more affordable, especially for young people. It also will make health insurance portable, which will free people from being locked into jobs they hate because they are afraid of losing their health insurance.
The Coburn-Ryan plan also helps the hard-to-insure and chronically ill because it shares their risk across all insurance companies, providing lower premiums than they might find now. It would help those in Medicaid because they receive private insurance rather than being forced into a one-size-fits-all government program in which doctors are increasingly refusing to participate.
About Karl Rove
Karl Rove served as Senior Advisor to President George W. Bush from 2000–2007 and Deputy Chief of Staff from 2004–2007. At the White House he oversaw the Offices of Strategic Initiatives, Political Affairs, Public Liaison, and Intergovernmental Affairs and was Deputy Chief of Staff for Policy, coordinating the White House policy making process.
Before Karl became known as "The Architect" of President Bush's 2000 and 2004 campaigns, he was president of Karl Rove + Company, an Austin-based public affairs firm that worked for Republican candidates, nonpartisan causes, and nonprofit groups. His clients included over 75 Republican U.S. Senate, Congressional and gubernatorial candidates in 24 states, as well as the Moderate Party of Sweden.
Karl writes a weekly op-ed for The Wall Street Journal, is a Newsweek columnist and is now writing a book to be published by Simon & Schuster. Email the author at Karl@Rove.com or visit him on the web at Rove.com.
Or, you can send him a Tweet @karlrove.
The House GOP also formed a Health Care Solutions Group that unveiled proposals yesterday. The group wanted to make health care more affordable, expand availability, and promote healthier life choices. It did this by proposing two-dozen ways to improve existing law to make it easier and more cost-effective to buy health insurance.
One proposal is to give families who purchase their own insurance a tax benefit similar to the one companies get for providing health benefits. Another proposal is to pass medical liability reforms that will reduce costly junk lawsuits. Still another would allow small businesses to team up to buy insurance at a group discount. The group also wants to allow families to save money tax-free for a wide range of health expenses and permit children to stay on their parents' policies until age 25.
Under the group's proposals, Medicaid beneficiaries would get the flexibility to choose private coverage, rather than being locked into a government-run program. The group is also calling for stepping up efforts to detect and punish Medicare and Medicaid fraud, which costs an estimated $60 billion a year.
Individual Republicans are also stepping forward with health-reform ideas, such as creating a national health-insurance market that would allow Americans to buy insurance across state lines. Sens. Jon Kyl (R., Ariz.) and Lamar Alexander (R., Tenn.) have offered other ideas, including expanding community health centers.
This is the first time congressional Republicans as a group have been comfortable talking about health care. It may be the product of necessity, but it is also necessary to get a robust debate on health-care reform.
Republican efforts will be helped by a recent Congressional Budget Office report that found that Sen. Ted Kennedy's health-care reform would cost at least $1 trillion over the next 10 years and still leave 36 million Americans uninsured (it may be slightly more once all the details are released). Estimates for the health-care bill that the Senate Finance Committee is drafting with help from the White House are coming in around $1.6 trillion over 10 years.
As the debate now shifts from broad generalities to the specifics of how health-care reform would work and how the government will pay for it, the GOP has an opportunity to stop the nationalization of the health-care industry. The more scrutiny it gets, the less appealing Obama-Care will become. And the more Democrats have to talk about creating a new value-added tax or junk food taxes to pay for it, the more Americans will recoil.
Republican credibility on health care depends on whether the party offers positive alternatives that build on the strengths of American medicine. As long as the choice was between reform and the status quo, the public was likely to go with the reformers. But if the debate is whether to go with costly, unnecessary reforms or with common-sense changes, then Republicans have a chance to appeal to fiscally conservative independents and Democrats and win this one. It is still possible to stop ObamaCare in its tracks. If Republicans can do that, they will win public confidence on an issue that will dominate politics for decades.
Mr. Rove is the former senior adviser and deputy chief of staff to President George W. Bush.
Tuesday, June 23, 2009
Public Healthcare by Mitchel Bard
A couple of weeks ago, in discussing torture, I asked why so many Republicans hate America. Now that the debate over how to fix the heath care system has moved forward, listening to the Republican position (which is, unfortunately, shared by some centrist Democrats), I can't help but wonder why these individuals hate Americans?
Okay, again, I am being cheeky, invoking the Republican claims during the Iraq war that Democrats hated America because they didn't support the administration's draconian approach to fighting terror. And I'm doing it again here, because, at heart, the Republicans (and, again, some centrist Democrats) who are opposing a public option in the new plan are doing so to protect profitable health insurance companies at the expense of the average American citizen. The arguments used by the Republicans (and centrist Democrats) against a public option are absolutely disingenuous.
When asked about a public option, Republicans tend to lapse into the same red-herring argument Sen. Lindsay Graham made on This Week yesterday:
"The last thing in the world I think Democrats and Republicans are going to do at the end of the day is create a government run health care system where you've got a bureaucrat standing in between the patient and the doctor. We've tried this model -- people have tried this model in other countries. The first thing that happens -- you have to wait for your care. And in socialized health care models, people have to wait longer to get care and the government begins to cut back on what's available because of the cost explosion."
I was half expecting Graham to move close to the camera and yell "Boo!" in an effort to further scare Americans.
Except, nobody is proposing the U.K.-style plan he is railing against. So why is he doing it? Simple. Because the Republicans (and centrist Democrats) are supporting the big insurance companies at the expense of the people, but they can't very well say that out loud, so they have resorted to changing the subject and trying to scare Americans into not noticing where they have tossed their allegiances.
You see, the Republicans are speaking out of both sides of their mouths. They are quick to tell you, as Graham did, how terrible government-run health care would be, with long waits for inferior service. But when you argue for a public option, with people being given the chance to keep what they have (with private insurers) or opt for a new public option (especially for those who don't currently have any insurance) that would compete with the private companies, then the Republicans say that the private insurers would be driven out of business because they can't compete with the public plan. But if the government-run plan would be so bad, why would the private insurers lose to it? Shouldn't Americans, terrified at the big bad government trying to run their health care decisions, run screaming away from the new public plan and into the arms of the wonderful private insurers they adore? What is the risk? And if the government-run plan is so good it would be an improvement over the private insurers, why are the Republicans against it (if they can't admit that they are protecting the business interests over the health of Americans)? Isn't the goal better care at lower costs?
It is a truly odious game the Republicans (and centrist Democrats) are playing now, which is even more despicable because of the stakes involved. The bottom line is that the American health care system is not working, and it's only getting worse. Medical costs are skyrocketing, tens of millions have no insurance at all, and those that do are facing higher fees and dwindling service. According to a recent report, 17 percent of American households put off health care in the last year due to cost. And 40 percent of respondents said they would need to to postpone care in the next three months, including 15 percent who said they had to put off routine doctor visits. The way health care works in the U.S. now, for-profit companies make decisions on Americans' health care based not on what is good for the patient, but on what will add to the company's profits. That's no way to care for our citizens.
And it's not like Americans are afraid of the government providing a public option for health care. A recent CBS News/New York Times poll found that 72 percent of respondents (including 50 percent of Republicans) favored a government-sponsored health-care plan to compete with private insurers, and 57 percent said they were willing to pay higher taxes so that all Americans could be covered. In fact, 64 percent of those polled said that the government should guarantee health insurance for all Americans.
So if the people want a public option, and the Republican arguments are, on their face, hypocritical (if the government-run plan is as terrible as they say, it would not be a threat to private insurers), why are so many Republican and centrist Democratic senators opposing a public plan?
After all, anyone happy with his/her current coverage would be free to keep it as it is. Only those with lousy coverage (or no coverage at all) would be exploring the public option.
Health care is one of the thorniest and most important issues the government has to face, and there needs to be a full and thorough debate in Congress. Concerns about cost, taxes, and systems are absolutely valid, and there are no easy solutions to the hole we've dug for ourselves. But the scare tactics and diversions being offered by the Republicans on the public option are more than just dishonest, they are dangerous, because they could derail necessary change to the current failed system. If Republicans oppose a public option because they want to support the insurance companies, they should say that, rather than making up stories about socialized medicine plans that nobody is proposing. The debate needs to be on honest terms.
The bottom line is that in the U.S. right now, millions of people have no health insurance, others are getting bumped from their coverage, and many people are fighting increased costs (in premiums, co-payments, and uncovered care), and the result is less care for more money. That simply is not acceptable, and the increased costs to the country of medical care are unsustainable. Something has to be done. If Republicans (and centrist Democrats) have a better suggestion than a public option, something that will effectively provide quality coverage to more Americans and bring down costs, then let's hear it. But if the best they can do is come up with scary language like Graham offered on This Week, while proposing only alternatives that will, in effect, perpetuate the broken status quo, that's unacceptable.
It's time for the Republicans and, especially, the centrist Democrats to listen to the will of the people. The discussion has to be on the level, and the solution has to be a system in which for-profit insurance monoliths no longer control the country's health care. If a public option will lead to increased coverage and lower health-care costs, then that's where we need to head. The Republicans and Centrist Democrats are currently protecting the insurance companies. I say it's time they start protecting the American people instead.
Okay, again, I am being cheeky, invoking the Republican claims during the Iraq war that Democrats hated America because they didn't support the administration's draconian approach to fighting terror. And I'm doing it again here, because, at heart, the Republicans (and, again, some centrist Democrats) who are opposing a public option in the new plan are doing so to protect profitable health insurance companies at the expense of the average American citizen. The arguments used by the Republicans (and centrist Democrats) against a public option are absolutely disingenuous.
When asked about a public option, Republicans tend to lapse into the same red-herring argument Sen. Lindsay Graham made on This Week yesterday:
"The last thing in the world I think Democrats and Republicans are going to do at the end of the day is create a government run health care system where you've got a bureaucrat standing in between the patient and the doctor. We've tried this model -- people have tried this model in other countries. The first thing that happens -- you have to wait for your care. And in socialized health care models, people have to wait longer to get care and the government begins to cut back on what's available because of the cost explosion."
I was half expecting Graham to move close to the camera and yell "Boo!" in an effort to further scare Americans.
Except, nobody is proposing the U.K.-style plan he is railing against. So why is he doing it? Simple. Because the Republicans (and centrist Democrats) are supporting the big insurance companies at the expense of the people, but they can't very well say that out loud, so they have resorted to changing the subject and trying to scare Americans into not noticing where they have tossed their allegiances.
You see, the Republicans are speaking out of both sides of their mouths. They are quick to tell you, as Graham did, how terrible government-run health care would be, with long waits for inferior service. But when you argue for a public option, with people being given the chance to keep what they have (with private insurers) or opt for a new public option (especially for those who don't currently have any insurance) that would compete with the private companies, then the Republicans say that the private insurers would be driven out of business because they can't compete with the public plan. But if the government-run plan would be so bad, why would the private insurers lose to it? Shouldn't Americans, terrified at the big bad government trying to run their health care decisions, run screaming away from the new public plan and into the arms of the wonderful private insurers they adore? What is the risk? And if the government-run plan is so good it would be an improvement over the private insurers, why are the Republicans against it (if they can't admit that they are protecting the business interests over the health of Americans)? Isn't the goal better care at lower costs?
It is a truly odious game the Republicans (and centrist Democrats) are playing now, which is even more despicable because of the stakes involved. The bottom line is that the American health care system is not working, and it's only getting worse. Medical costs are skyrocketing, tens of millions have no insurance at all, and those that do are facing higher fees and dwindling service. According to a recent report, 17 percent of American households put off health care in the last year due to cost. And 40 percent of respondents said they would need to to postpone care in the next three months, including 15 percent who said they had to put off routine doctor visits. The way health care works in the U.S. now, for-profit companies make decisions on Americans' health care based not on what is good for the patient, but on what will add to the company's profits. That's no way to care for our citizens.
And it's not like Americans are afraid of the government providing a public option for health care. A recent CBS News/New York Times poll found that 72 percent of respondents (including 50 percent of Republicans) favored a government-sponsored health-care plan to compete with private insurers, and 57 percent said they were willing to pay higher taxes so that all Americans could be covered. In fact, 64 percent of those polled said that the government should guarantee health insurance for all Americans.
So if the people want a public option, and the Republican arguments are, on their face, hypocritical (if the government-run plan is as terrible as they say, it would not be a threat to private insurers), why are so many Republican and centrist Democratic senators opposing a public plan?
After all, anyone happy with his/her current coverage would be free to keep it as it is. Only those with lousy coverage (or no coverage at all) would be exploring the public option.
Health care is one of the thorniest and most important issues the government has to face, and there needs to be a full and thorough debate in Congress. Concerns about cost, taxes, and systems are absolutely valid, and there are no easy solutions to the hole we've dug for ourselves. But the scare tactics and diversions being offered by the Republicans on the public option are more than just dishonest, they are dangerous, because they could derail necessary change to the current failed system. If Republicans oppose a public option because they want to support the insurance companies, they should say that, rather than making up stories about socialized medicine plans that nobody is proposing. The debate needs to be on honest terms.
The bottom line is that in the U.S. right now, millions of people have no health insurance, others are getting bumped from their coverage, and many people are fighting increased costs (in premiums, co-payments, and uncovered care), and the result is less care for more money. That simply is not acceptable, and the increased costs to the country of medical care are unsustainable. Something has to be done. If Republicans (and centrist Democrats) have a better suggestion than a public option, something that will effectively provide quality coverage to more Americans and bring down costs, then let's hear it. But if the best they can do is come up with scary language like Graham offered on This Week, while proposing only alternatives that will, in effect, perpetuate the broken status quo, that's unacceptable.
It's time for the Republicans and, especially, the centrist Democrats to listen to the will of the people. The discussion has to be on the level, and the solution has to be a system in which for-profit insurance monoliths no longer control the country's health care. If a public option will lead to increased coverage and lower health-care costs, then that's where we need to head. The Republicans and Centrist Democrats are currently protecting the insurance companies. I say it's time they start protecting the American people instead.
Sunday, June 21, 2009
Saturday, June 20, 2009
Friday, June 19, 2009
Thursday, June 18, 2009
Wednesday, June 17, 2009
Attack of The Zombie Republicans. by John Batchelor
The GOP’s living dead won’t stop haunting their party, says lifelong Republican John Batchelor. Now Rush, Newt, and Dick are doing what zombies do best: laying waste to everyone’s brains.
The Republican Party has become many bad things—intolerant, inert, fly-blown, incoherent, and delusional—but the worst is that the GOP is no longer young. The GOP, according to a Gallup poll, has lost, forgotten, ignored, just generally scared off the younger voters, non-white voters, and female voters in all demographics.
What is a political party that is vastly white, middle-aged, male, Southern, pious, conservative, aggrieved, impotent, nostalgic, rude—and regarded negatively by more than half the respondents? Time magazine’s Republican political consultant Mike Murphy looks at the demographics and warns of a coming “ice age” for the party. That is grossly optimistic. No longer in second place, the voter self-identification polls place the Republicans well behind the leading independents and the second-place Democrats. The GOP is the equivalent of a shrinking third party on its way to becoming a museum piece beside the Whigs, the Greenbacks, and the Prohibitionists. The GOP is like a zombie cartoon reading the daily headlines of the last four years and asking, “Am I dead?”
The attack of the living dead Republicans does have the camp fascination of a George Romero movie as pieces of brains fall out. Last week, Deputy Minority Leader Eric Cantor of Virginia, in some quarters regarded as cunning, boasted soberly not only that, without any polling evidence, “I think we’re got a shot at taking back the House,” but also that the Obama administration was comparable to Putin’s rule in Moscow. Cantor did not explain if he meant that the Obama administration is Soviet socialist, which is balmy, since Moscow is a robber baron paradise these days, or if he meant the Obama administration stands for tyrannical one-party rule, which is dopey, since Cantor appears to think of himself as virile leader of the opposition.
Last week, former House Speaker Newt Gingrich, a generalissimo of zombies, fresh from smearing Supreme Court nominee Sonia Sotomayor for “new racism,” presented more startling delusions at a congressional fundraiser in Washington when he claimed that the Republicans were the “majority party.” He offered no facts to counter the Gallup poll’s certainty that the Republicans are a minor minority party. Nor did Gingrich, who increasingly pontificates with the bravado of the vacuous TV anchor from the old Mary Tyler Moore Show, Ted Baxter, note that the cash raised in the ballroom of swells was down by a third from last year; nor did he explain his demagogic remark that the Obama administration “has already failed,” with bailouts that are chiefly a continuation of a Republican administration’s panicky policies.
The GOP is the equivalent of a shrinking third party on its way to becoming a museum piece beside the Whigs, the Greenbacks, and the Prohibitionists.
Gingrich did take aim at his demagogic pal Rush “Obama to fail” Limbaugh when he said, “I am happy that Dick Cheney is a Republican. I am happy that Colin Powell is a Republican.” This coy rhetoric was meant to point to the dull disputes between Limbaugh and those Republican politicians who he claims are unwelcome in the party because they don’t agree with him. Limbaugh routinely runs his mouth about disloyal or “squishy” Republicans, as if he was outing the skin-job Cylons on Battlestar Galactica. It is trite, but it can quickly turn vulgar. On TV, Limbaugh recently baited Colin Powell and the Republican moderate stragglers again when he boomed “What has Colin Powell ever done that makes him so valuable to the Republican Party?”
Tuesday, June 16, 2009
Whistling Past The Economic Graveyard : The Audacity of Misplaced Hope.by Arianna Huffington
Is it possible to have too much hope? To be too optimistic? Yes, if that hope keeps you from facing -- and dealing with -- unpleasant realities.
That seems to be what's happening regarding the financial institutions responsible for the economic meltdown.
Let's start with the banks' toxic assets. When Tim Geithner unveiled the Public Private Investment Program, he said that dealing with these assets was a "core" part of solving the financial crisis.
But the banks would much rather keep pretending that their toxic assets are not that toxic, and worth much more than they really are -- a risky charade the relaxed mark-to-market rules allow them to continue to pull off.
So, last week, the PPIP program was apparently scrapped. Does this mean that the toxic assets are no longer a "core" part of the problem? Or that hoping they're no longer part of the problem will somehow make them no longer part of the problem?
"Hope sustains life, but misplaced hope prolongs recessions." So says Jim Grant, publisher of the Grant's Interest Rate Observer newsletter, whom I interviewed last week on Squawk Box. Because of misplaced hope, Grant says, business people, homeowners -- and administrations -- often refuse to admit the truth and take the painful steps necessary to turn things around.
On Wednesday, President Obama will lay out the details of his administration's plan to remake the financial regulatory system. Geithner and Larry Summers offered a sneak peak at the plan in an op-ed in today's Washington Post, proclaiming, "we must begin today to build the foundation for a stronger and safer system."
Among the proposals: "raising capital and liquidity requirements for all institutions"; "consolidated supervision by the Federal Reserve"; "robust reporting requirements on the issuers of asset-backed securities" including "strong oversight of 'over the counter' derivatives"; and providing "a stronger framework for consumer and investor protection across the board."
The devil, of course, will be in the details. And on how much muscle Obama puts behind pushing these measures through and ensuring they become law without being watered down. Especially at a time when the latest stock market bubble has undermined the urgent push for reform, which seems to have given way to a push to move on to other things and leave that little financial kerfuffle behind us.
And investors seem anxious to do the same. Witness the "fierce rally" in the collateralized loan obligation market. CLOs are made up of sliced and diced assets (including high-risk and junk loans) -- and are kissing cousins to the collateralized-debt obligations (i.e. crap) at the heart of the financial meltdown. But according to analysts at Morgan Stanley there has recently been a "remarkable change" in investor sentiment towards these securities, including an "exuberance" for the lowest grade junk being sold.
In other words, we are right back to risky business as usual. No harm, no foul. Let's get back to the fun we were having before this whole worldwide economic collapse thing started happening.
It puts a whole other spin on the audacity of hope.
Too many in Washington -- and in the media continue to take the well-being of Wall Street as the proper gauge for the well-being of the rest of America. Yes, the Dow is up 33 percent since March. But another 345,000 jobs were lost in May, raising the number of the unemployed to 14.5 million, and the unemployment rate to 9.4 percent. Since the start of the recession in December 2007, unemployment has almost doubled.
What's more, as this chart shows, over the past two decades, the top one percent of Americans has done very well in terms of wage growth. Things have not been nearly as good for everybody else.
Are the reforms going to be sufficiently fundamental to avoid a repeat of the boom and bust cycles, in which only a select few enjoy the boom and everybody else pays for the bust?
Obama Stamp Is On Finance Rules
Obama Stamp Is on Finance Rules
Detailed Plan on Retooling the Sector Ensures White House Will Get Credit or Blame
By DAMIAN PALETTA
WASHINGTON -- In drafting its proposed revamp of financial-sector regulation, the Obama administration sought to leave few of the initial details to Congress, a risky strategy that could pin much of the plan's success or failure on the president himself.
The exhaustive series of meetings and nitty-gritty debates that forged the comprehensive plan -- to be presented to Congress Wednesday -- contrasts with the way the administration has approached other priorities, such as health care and energy policy. In those cases, the White House has left the fine print to be filled in by Congress.
Journal Community
Discuss: Would the proposed financial regulation overhaul prevent another financial crisis? The different approaches reflect how some of the administration's most senior officials are personally invested in the finance overhaul, worried that political tinkering by lawmakers could undermine their goals. Others say the package only works if all the pieces are designed to fit together.
"We identified lots of options and we approached some of them with presumptive answers, but in a way nothing was nailed down until it was all nailed down because so much of this is interconnected and interrelated," said Treasury Department Deputy Secretary Neal Wolin.
Patrick Parkinson, a markets expert who took a leave from the Federal Reserve.
Roughly once a week, sometimes more, the team met with Treasury Secretary Timothy Geithner or National Economic Council Director Lawrence Summers to run through ideas. Mr. Summers became known for his ability to shred and discredit any idea presented, forcing aides to scramble to defend their proposals.
"The challenge for many people...is that he can argue both sides of an argument better than anyone," said Diana Farrell, deputy director of the NEC.
Officials now feel that this exercise with Mr. Summers, which left some red-faced at the time, will make it much easier to defend their ideas on Capitol Hill.
The plan would bring sweeping changes to the way financial markets are overseen, empowering federal regulators and limiting the amount of risk financial companies can extend. It also would allow the government to take over and break up large firms, boost consumer protections and push for changes in the way loans are securitized.
The core work was handled by a group of aides, led by Mr. Wolin and Ms. Farrell, that met most weekdays at 1 p.m. Because there were so many topics, officials broke discussions into groups. Sometimes meetings began with 15 priorities and officials only worked their way through four.
"It was a lot like doing dishes," said Ms. Farrell. "Just when you think you are done, and just as you are putting the last plate away, a whole new set of plates comes forward."
The team was built to have contrasting views so officials could debate a wide range of alternatives. Key players included Treasury Assistant Secretary Michael Barr, an expert on financial institutions and consumer protection; Cass Sunstein, a constitutional-law expert who joined the White House from Harvard Law School; and Patrick Parkinson, a markets expert who took a leave from the Federal Reserve to join the Treasury Department.
One debate that consumed the team was whether to oversee systemic risks through the Fed or give more power to a council of regulators. At a recent meeting, one aide said it was better to go to war against a committee than with one, an observation that led to a focus on giving the Fed more power.
The group also debated what to do with firms that pose a systemic risk to the economy. It was ultimately decided that the most efficient way to oversee such companies was to push them to register as "financial holding companies," which would bring them directly under Fed supervision.
People involved in the process described it as unique because, at least so far, insiders have driven the agenda without substantial pressure from outsiders.
"By no means were they saying 'Give us your ideas and we'll do what you want,'" said John Taylor, chief executive of the National Community Reinvestment Coalition, who met with the group several times. "We have no illusions."
Write to Damian Paletta at damian.paletta@wsj.com
Printed in The Wall Street Journal
Detailed Plan on Retooling the Sector Ensures White House Will Get Credit or Blame
By DAMIAN PALETTA
WASHINGTON -- In drafting its proposed revamp of financial-sector regulation, the Obama administration sought to leave few of the initial details to Congress, a risky strategy that could pin much of the plan's success or failure on the president himself.
The exhaustive series of meetings and nitty-gritty debates that forged the comprehensive plan -- to be presented to Congress Wednesday -- contrasts with the way the administration has approached other priorities, such as health care and energy policy. In those cases, the White House has left the fine print to be filled in by Congress.
Journal Community
Discuss: Would the proposed financial regulation overhaul prevent another financial crisis? The different approaches reflect how some of the administration's most senior officials are personally invested in the finance overhaul, worried that political tinkering by lawmakers could undermine their goals. Others say the package only works if all the pieces are designed to fit together.
"We identified lots of options and we approached some of them with presumptive answers, but in a way nothing was nailed down until it was all nailed down because so much of this is interconnected and interrelated," said Treasury Department Deputy Secretary Neal Wolin.
Patrick Parkinson, a markets expert who took a leave from the Federal Reserve.
Roughly once a week, sometimes more, the team met with Treasury Secretary Timothy Geithner or National Economic Council Director Lawrence Summers to run through ideas. Mr. Summers became known for his ability to shred and discredit any idea presented, forcing aides to scramble to defend their proposals.
"The challenge for many people...is that he can argue both sides of an argument better than anyone," said Diana Farrell, deputy director of the NEC.
Officials now feel that this exercise with Mr. Summers, which left some red-faced at the time, will make it much easier to defend their ideas on Capitol Hill.
The plan would bring sweeping changes to the way financial markets are overseen, empowering federal regulators and limiting the amount of risk financial companies can extend. It also would allow the government to take over and break up large firms, boost consumer protections and push for changes in the way loans are securitized.
The core work was handled by a group of aides, led by Mr. Wolin and Ms. Farrell, that met most weekdays at 1 p.m. Because there were so many topics, officials broke discussions into groups. Sometimes meetings began with 15 priorities and officials only worked their way through four.
"It was a lot like doing dishes," said Ms. Farrell. "Just when you think you are done, and just as you are putting the last plate away, a whole new set of plates comes forward."
The team was built to have contrasting views so officials could debate a wide range of alternatives. Key players included Treasury Assistant Secretary Michael Barr, an expert on financial institutions and consumer protection; Cass Sunstein, a constitutional-law expert who joined the White House from Harvard Law School; and Patrick Parkinson, a markets expert who took a leave from the Federal Reserve to join the Treasury Department.
One debate that consumed the team was whether to oversee systemic risks through the Fed or give more power to a council of regulators. At a recent meeting, one aide said it was better to go to war against a committee than with one, an observation that led to a focus on giving the Fed more power.
The group also debated what to do with firms that pose a systemic risk to the economy. It was ultimately decided that the most efficient way to oversee such companies was to push them to register as "financial holding companies," which would bring them directly under Fed supervision.
People involved in the process described it as unique because, at least so far, insiders have driven the agenda without substantial pressure from outsiders.
"By no means were they saying 'Give us your ideas and we'll do what you want,'" said John Taylor, chief executive of the National Community Reinvestment Coalition, who met with the group several times. "We have no illusions."
Write to Damian Paletta at damian.paletta@wsj.com
Printed in The Wall Street Journal
Senate Mulls Over Health -Bill
Senate Mulls Over Health-Bill
By GREG HITT and LAURA MECKLER
A key Senate committee wrestled Monday with details of a health plan that would allow nonprofit cooperatives to compete with private insurers and would tax health-care benefits for the first time.
The action in the Senate Finance Committee came as President Barack Obama urged the American Medical Association to support sweeping changes to the nation's health-care system.
Top Finance Committee aides are scrubbing financing options in a bid to find more than $1 trillion needed to pay for a 10-year plan, and have settled on many details of how to expand coverage to the uninsured.
Under one financing proposal, health-care benefits worth more than $17,000 would be taxed as regular income, a cap that would be allowed to grow annually, said people familiar with committee discussions. A version of this plan was evaluated by the Congressional Budget Office last year and found to raise some $450 billion over 10 years.
Under another option, the cap would be set at about $20,000, but with a less generous annual adjustment. Also under consideration: limiting the new taxes based on income.
President Barack Obama addressed the AMA Monday in Chicago.
A committee spokeswoman, Erin Shields, cautioned no decisions have been made and called the situation "fluid." Senate Finance Chairman Max Baucus (D., Mont.) hopes to release health-care legislation Friday, setting up formal votes next week.
More
Report Lays Out Plan to Cut Medicare Costs Wash Wire: Obama to Doctors: 'I Need Your Help' Health Blog: AMA's Response to Obama's Speech The committee is close to settling on a plan that would create state-run marketplaces where private health-insurance companies would compete to offer coverage. To answer demands from Democrats including Mr. Obama that a public plan be offered as well, the committee is heavily favoring nonprofit cooperatives that would be governed by their members and would compete inside the new insurance exchanges, people familiar with the matter said.
The plan under consideration would require all Americans to obtain insurance, with penalties eventually reaching 75% of the cost of the least expensive plan, one aide said.
Subsidies would be available for people earning up to four times the federal poverty level, the aide said, though that figure could be slimmed back. The committee is also expected to include an expansion of Medicaid, the federal-state health program for the poor.
On the revenue side, Sen. Baucus is aiming to raise needed money from within the health-care sector, congressional aides said. One idea is to raise the threshold for taking an itemized tax deduction on personal health costs to 10% of adjusted gross income from 7.5% currently. Another proposal under consideration would double the tax penalty—to 20% from 10%—for nonmedical withdrawals from tax-preferred health savings accounts.
Any plan adopted by the Senate Finance Committee would have to be reconciled with other Democratic-led proposals in the House and Senate.
On Monday, the Congressional Budget Office released a preliminary analysis of legislation written by Sen. Edward Kennedy (D., Mass.). The office found that the effort would cost some $1 trillion over a decade but leave 37 million people uninsured. That proposal was missing key details that are likely to significantly change the final numbers.
The final package is likely to provide more help for people near the poverty line and include a requirement that many or most employers offer coverage, which would raise the cost and reduce the number of uninsured.
Still, the numbers provided ammunition for Republicans. "These early reports from CBO show that this bill will cost too much, cover too few and cause too many to lose the coverage they enjoy now," said Sen. Mike Enzi of Wyoming, the top Republican on Mr. Kennedy's Senate committee.
In his Chicago speech, Mr. Obama reiterated his support for a public-insurance option and suggested it shouldn't pay Medicare rates -- a bid to assuage concerns of doctors who consider those rates too low.
The president received a rare round of boos when he told the audience of some 2,200 that he wouldn't advocate caps on medical-malpractice awards. But he later won applause when he said he was willing to work with doctors to scale back "excessive defensive medicine" and ensure that doctors don't feel "like they're constantly looking over their shoulders for fear of lawsuits."
Mr. Obama's approach to the doctors was sympathetic, a striking contrast with his rhetoric toward insurance companies.
"You didn't enter this profession to be bean-counters and paper-pushers. You entered this profession to be healers," he said to applause.
The president said he wouldn't let insurers continue to deny coverage based on pre-existing conditions, without mentioning that the main insurance lobby group has already agreed to stop that practice as part of a comprehensive overhaul.
Mr. Obama said he won't create a system where insurers "suddenly have a whole bunch of more customers on Uncle Sam's dime, but still fail to meet their responsibilities."
Apart from the isolated boos, doctors responded enthusiastically to most of Mr. Obama's speech, with the crowd jumping to its feet for a standing ovation a few times. "What we were very pleased about was that he's open to considering options that would lower the costs of defensive medicine," said AMA President Nancy Nielsen.
For decades, the AMA opposed government efforts at universal health care, famously opposing the creation of Medicare as well as subsequent efforts including President Bill Clinton's attempt in 1993-94. The concern was that such a plan would lead to both too much government interference in the practice of medicine and low reimbursement rates, said Nancy Dickey, former president of the American Medical Association and president of Texas A&M Health Science Center.
But that started to change in the mid-1990s, she said, when medicine became more expensive, and care for the uninsured became more worrisome. Another factor: doctor frustration over restrictions put on them by insurance companies.
— Janet Adamy contributed to this article.
Write to Greg Hitt at greg.hitt@wsj.com and Laura Meckler at laura.meckler@wsj.com
Printed in The Wall Street Journal
By GREG HITT and LAURA MECKLER
A key Senate committee wrestled Monday with details of a health plan that would allow nonprofit cooperatives to compete with private insurers and would tax health-care benefits for the first time.
The action in the Senate Finance Committee came as President Barack Obama urged the American Medical Association to support sweeping changes to the nation's health-care system.
Top Finance Committee aides are scrubbing financing options in a bid to find more than $1 trillion needed to pay for a 10-year plan, and have settled on many details of how to expand coverage to the uninsured.
Under one financing proposal, health-care benefits worth more than $17,000 would be taxed as regular income, a cap that would be allowed to grow annually, said people familiar with committee discussions. A version of this plan was evaluated by the Congressional Budget Office last year and found to raise some $450 billion over 10 years.
Under another option, the cap would be set at about $20,000, but with a less generous annual adjustment. Also under consideration: limiting the new taxes based on income.
President Barack Obama addressed the AMA Monday in Chicago.
A committee spokeswoman, Erin Shields, cautioned no decisions have been made and called the situation "fluid." Senate Finance Chairman Max Baucus (D., Mont.) hopes to release health-care legislation Friday, setting up formal votes next week.
More
Report Lays Out Plan to Cut Medicare Costs Wash Wire: Obama to Doctors: 'I Need Your Help' Health Blog: AMA's Response to Obama's Speech The committee is close to settling on a plan that would create state-run marketplaces where private health-insurance companies would compete to offer coverage. To answer demands from Democrats including Mr. Obama that a public plan be offered as well, the committee is heavily favoring nonprofit cooperatives that would be governed by their members and would compete inside the new insurance exchanges, people familiar with the matter said.
The plan under consideration would require all Americans to obtain insurance, with penalties eventually reaching 75% of the cost of the least expensive plan, one aide said.
Subsidies would be available for people earning up to four times the federal poverty level, the aide said, though that figure could be slimmed back. The committee is also expected to include an expansion of Medicaid, the federal-state health program for the poor.
On the revenue side, Sen. Baucus is aiming to raise needed money from within the health-care sector, congressional aides said. One idea is to raise the threshold for taking an itemized tax deduction on personal health costs to 10% of adjusted gross income from 7.5% currently. Another proposal under consideration would double the tax penalty—to 20% from 10%—for nonmedical withdrawals from tax-preferred health savings accounts.
Any plan adopted by the Senate Finance Committee would have to be reconciled with other Democratic-led proposals in the House and Senate.
On Monday, the Congressional Budget Office released a preliminary analysis of legislation written by Sen. Edward Kennedy (D., Mass.). The office found that the effort would cost some $1 trillion over a decade but leave 37 million people uninsured. That proposal was missing key details that are likely to significantly change the final numbers.
The final package is likely to provide more help for people near the poverty line and include a requirement that many or most employers offer coverage, which would raise the cost and reduce the number of uninsured.
Still, the numbers provided ammunition for Republicans. "These early reports from CBO show that this bill will cost too much, cover too few and cause too many to lose the coverage they enjoy now," said Sen. Mike Enzi of Wyoming, the top Republican on Mr. Kennedy's Senate committee.
In his Chicago speech, Mr. Obama reiterated his support for a public-insurance option and suggested it shouldn't pay Medicare rates -- a bid to assuage concerns of doctors who consider those rates too low.
The president received a rare round of boos when he told the audience of some 2,200 that he wouldn't advocate caps on medical-malpractice awards. But he later won applause when he said he was willing to work with doctors to scale back "excessive defensive medicine" and ensure that doctors don't feel "like they're constantly looking over their shoulders for fear of lawsuits."
Mr. Obama's approach to the doctors was sympathetic, a striking contrast with his rhetoric toward insurance companies.
"You didn't enter this profession to be bean-counters and paper-pushers. You entered this profession to be healers," he said to applause.
The president said he wouldn't let insurers continue to deny coverage based on pre-existing conditions, without mentioning that the main insurance lobby group has already agreed to stop that practice as part of a comprehensive overhaul.
Mr. Obama said he won't create a system where insurers "suddenly have a whole bunch of more customers on Uncle Sam's dime, but still fail to meet their responsibilities."
Apart from the isolated boos, doctors responded enthusiastically to most of Mr. Obama's speech, with the crowd jumping to its feet for a standing ovation a few times. "What we were very pleased about was that he's open to considering options that would lower the costs of defensive medicine," said AMA President Nancy Nielsen.
For decades, the AMA opposed government efforts at universal health care, famously opposing the creation of Medicare as well as subsequent efforts including President Bill Clinton's attempt in 1993-94. The concern was that such a plan would lead to both too much government interference in the practice of medicine and low reimbursement rates, said Nancy Dickey, former president of the American Medical Association and president of Texas A&M Health Science Center.
But that started to change in the mid-1990s, she said, when medicine became more expensive, and care for the uninsured became more worrisome. Another factor: doctor frustration over restrictions put on them by insurance companies.
— Janet Adamy contributed to this article.
Write to Greg Hitt at greg.hitt@wsj.com and Laura Meckler at laura.meckler@wsj.com
Printed in The Wall Street Journal
Monday, June 15, 2009
Geithner to Defend Economic Measures
Geithner to defend economic measures at hearings
By Michael O'Brien
Posted: 06/15/09 07:30 AM [ET]
Treasury Secretary Tim Geithner will take to Capitol Hill this week to defend the Obama administration's latest proposals on executive compensation and financial regulation.
In a twin set of appearances before House and Senate committees, Geithner is expected to lay out administration proposals while taking questions from lawmakers, some of whom have shown anxiousness over the administration's involvement in the economy.
The administration will lay out its proposed makeover of the financial regulatory system, Geithner said during a meeting of G8 financial ministers in Italy this past weekend, and meeting the lawmakers will be the administration's first major test of those proposals.
The Treasury secretary will appear before the Senate Banking Committee in the morning on Thursday, and before the House Financial Services Committee that afternoon.
Geithner said this weekend that the administration's proposals will include tougher oversight of financial institutions and markets that span globally, and higher standards for capital requirements.
More broadly, Geithner will have to sell Congress on President Obama's involvement in automakers Chrysler and General Motors, as well as the proposed curbs on executive compensation packages.
He'll find an early, if partial, critic in House Financial Services Committee Chairman Barney Frank (D-Mass.) when it comes to executive compensation. While Frank endorsed the so-called "say on pay" element of the administration's compensation reform plans, he ridiculed a key part of the plan: enabling the Securities and Exchange Commission (SEC) to act more forcefully to ensure compensation committees' independence at banks and other companies.
The appearances on Capitol Hill appear to be part of a broader effort by the Treasury to help push the line forward on the administration's financial policies. Among other plans this week, Geithner will participate in a question-and-answer forum with Time magazine in New York on Tuesday morning, which will focus principally on "the Obama administration’s efforts to repair and strengthen our financial system and close the critical gaps that contributed to the financial crisis."
By Michael O'Brien
Posted: 06/15/09 07:30 AM [ET]
Treasury Secretary Tim Geithner will take to Capitol Hill this week to defend the Obama administration's latest proposals on executive compensation and financial regulation.
In a twin set of appearances before House and Senate committees, Geithner is expected to lay out administration proposals while taking questions from lawmakers, some of whom have shown anxiousness over the administration's involvement in the economy.
The administration will lay out its proposed makeover of the financial regulatory system, Geithner said during a meeting of G8 financial ministers in Italy this past weekend, and meeting the lawmakers will be the administration's first major test of those proposals.
The Treasury secretary will appear before the Senate Banking Committee in the morning on Thursday, and before the House Financial Services Committee that afternoon.
Geithner said this weekend that the administration's proposals will include tougher oversight of financial institutions and markets that span globally, and higher standards for capital requirements.
More broadly, Geithner will have to sell Congress on President Obama's involvement in automakers Chrysler and General Motors, as well as the proposed curbs on executive compensation packages.
He'll find an early, if partial, critic in House Financial Services Committee Chairman Barney Frank (D-Mass.) when it comes to executive compensation. While Frank endorsed the so-called "say on pay" element of the administration's compensation reform plans, he ridiculed a key part of the plan: enabling the Securities and Exchange Commission (SEC) to act more forcefully to ensure compensation committees' independence at banks and other companies.
The appearances on Capitol Hill appear to be part of a broader effort by the Treasury to help push the line forward on the administration's financial policies. Among other plans this week, Geithner will participate in a question-and-answer forum with Time magazine in New York on Tuesday morning, which will focus principally on "the Obama administration’s efforts to repair and strengthen our financial system and close the critical gaps that contributed to the financial crisis."
Viva Obama - Los Dorados del Norte
Grassroots campaigning to reach mexicans with music they will listen to. Messages of family, blue collar workers and even reaching out to states with large populations of mexicans and hispanics( Notice how Arizona is mentioned but a visual was not used like the other states). Powerfull medium and outreach, these guys play at small venues and large. I knew the outreach was large but other candidates against democrats have a lot of explaining to do. In the video the drummer even got his coworker to hold a sign for the cause and the music video. Great video, great campaigning.
Sunday, June 14, 2009
U.S. Combat troops to leave all Iraqi Cities
U.S. combat troops to leave all Iraqi cities
--------------------------------------------------------------------------------
By Tim CocksPosted 2009/06/02 at 1:01 pm EDT
SAMARRA, Iraq, June 2, 2009 (Reuters) — U.S. combat forces will vacate all Iraqi cities on schedule by the end of this month, the commander of U.S. forces in Iraq said Tuesday, including the still violent insurgent holdout of Mosul. U.S. combat troops are scheduled to leave Iraq's towns and cities by June 30 and redeploy to bases outside, according to a security pact that took effect in January.
Some U.S. and Iraqi officials had suggested this might have to be delayed in the case of Mosul, where al Qaeda and other insurgent groups still carry out frequent attacks.
Asked whether U.S. combat forces were on track for a total pullout from all cities, including Mosul, army General Ray Odierno said. "We are. We have done a joint assessment ... We have finalized that."
"We will come out of the cities. We will provide some trainers and advisers, LNOs (liaison officers) ... inside of Mosul ... but that'll be it," he said in an interview.
Odierno had previously not ruled out staying on in Mosul if the Iraqi government requested help to fight insurgents.
"We've made some good progress up there in the last several months. I feel much better about where we're at in terms of security in Mosul ... We'll be able to turn it over," he said.
TIME TO MOVE OUT
Odierno was speaking to Reuters on a trip to the city of Samarra, where the bombing of one of Shi'ite Islam's holiest shrines in February 2006 led to a wave of tit-for-tat sectarian slaughter that nearly tipped Iraq into civil war.
That attack was blamed on al Qaeda. Odierno said bombings in Shi'ite parts of Baghdad in April this year were carried out by al Qaeda militants trying to rekindle sectarian violence.
He said that since 2006, Iraqi security forces had made huge leaps in the size of their forces, and better training and equipment, but U.S. forces would remain in Iraq in an advisory role until the end of 2011, the withdrawal date agreed with Baghdad in the bilateral security pact.
"I think it's time for us to move out of the cities, I think it's important that people understand we are going to abide by the agreement that we've signed," he said.
Al Qaeda regrouped in Mosul and surrounding Nineveh province after losing former strongholds in Baghdad and western Iraq. Odierno said defeating the insurgency in Mosul depended on the new provincial government acting quickly to provide basic services.
"This is not about winning a war. It's about creating an environment where the Iraqi government can be ... serving its people ... this is about the long term development of a nation."
Odierno said two major threats were tension between Kurds and Arabs over control of land and oil, and Iran's backing for Shi'ite militias in the south. He said Iran was still training, funding and supplying weapons to militias with a view to forcing U.S. troops out of Iraq early. Tehran has denied this.
U.S. combat forces will leave Iraq by August 2010 under President Barack Obama's plan. Odierno said about 50,000 troops would stay on to train and advise only until the 2011 deadline.
"You'll never know until you leave. As long as we're here, we can't say they're standing on their own two feet," he said.
(Editing by Andrew Dobbie)
Boozing Bankers
June 10, 2009
Boozing Bankers Celebrate Their Wealth and Triumph (Brent Budowsky)
@ 9:28 am
Yesterday, many banks escaped from the Troubled Asset Relief Program (TARP) — and last night they were celebrating their good fortune at their favorite taverns.
Don’t miss the lead story in today's New York Times, describing how these bankers were toasting their triumph, confident that happy days are here for them, that their pay will further improve "even if the broader economy does not.”
Banks were given trillions of dollars to loan, but they didn't loan, and now they are paying back the money, and still don't loan. The president will impose compensation limits on banks that receive TARP money, once they no longer receive TARP money. He will gently, politely ask the other banks to limit compensation, and while they lift their next brew, they will gently, politely ignore him.
The stories spread by the day: retreat on compensation, surrender on major financial regulation, rise in credit card interest rates, continuing sharp uptick in foreclosures, refusal by banks to lend. The president opines; Geithner claims credit; Paulson is triumphant; Republicans applaud the magic of the market; both parties continue their banking fundraisers; bankers lift a brew in celebration because for them, happy days are here again — even if they are not for us.
Archived under: Economy & Budget
Boozing Bankers Celebrate Their Wealth and Triumph (Brent Budowsky)
@ 9:28 am
Yesterday, many banks escaped from the Troubled Asset Relief Program (TARP) — and last night they were celebrating their good fortune at their favorite taverns.
Don’t miss the lead story in today's New York Times, describing how these bankers were toasting their triumph, confident that happy days are here for them, that their pay will further improve "even if the broader economy does not.”
Banks were given trillions of dollars to loan, but they didn't loan, and now they are paying back the money, and still don't loan. The president will impose compensation limits on banks that receive TARP money, once they no longer receive TARP money. He will gently, politely ask the other banks to limit compensation, and while they lift their next brew, they will gently, politely ignore him.
The stories spread by the day: retreat on compensation, surrender on major financial regulation, rise in credit card interest rates, continuing sharp uptick in foreclosures, refusal by banks to lend. The president opines; Geithner claims credit; Paulson is triumphant; Republicans applaud the magic of the market; both parties continue their banking fundraisers; bankers lift a brew in celebration because for them, happy days are here again — even if they are not for us.
Archived under: Economy & Budget
$ 1.8 Billion Profit
June 10, 2009
President Touts $1.8 Billion 'Profit' on Bank Bailout (Armstrong Williams)
@ 1:45 pm
Mr. President,
Congratulations are in order. You have an annualized rate of return of one-half of 1 percent on your $750 billion Troubled Asset Relief Program (TARP) investment.
Please let us know how many banks will not be returning capital to TARP. Will taxpayers ever see a return on the $50 billion converted to Citibank stock? Or the $50 billion of AIG stock? Or the $20 billion of Bank of America stock? What is the rate of return you're expecting from the $50 billion spent on the automotive industry prior to bankruptcy?
Most investment professionals view their rate of return and successes on the entire investment portfolio, not one or two successes in an otherwise lackluster portfolio. The rate of return on 10-year Treasury bonds is 3.9 percent. The U.S. government is borrowing money at 3.9 percent to get a return of 0.5 percent. It is obvious that you and your economic advisers have no visceral feel for finance on any level.
A pearl of wisdom, Mr. President, as you continue along this dangerous and disastrous financial path: Remember the aphorism "Don't count your chickens before they hatch.” In other words, don't tout your profits until after you have realized your losses.
Visit www.armstrongwilliams.com .
President Touts $1.8 Billion 'Profit' on Bank Bailout (Armstrong Williams)
@ 1:45 pm
Mr. President,
Congratulations are in order. You have an annualized rate of return of one-half of 1 percent on your $750 billion Troubled Asset Relief Program (TARP) investment.
Please let us know how many banks will not be returning capital to TARP. Will taxpayers ever see a return on the $50 billion converted to Citibank stock? Or the $50 billion of AIG stock? Or the $20 billion of Bank of America stock? What is the rate of return you're expecting from the $50 billion spent on the automotive industry prior to bankruptcy?
Most investment professionals view their rate of return and successes on the entire investment portfolio, not one or two successes in an otherwise lackluster portfolio. The rate of return on 10-year Treasury bonds is 3.9 percent. The U.S. government is borrowing money at 3.9 percent to get a return of 0.5 percent. It is obvious that you and your economic advisers have no visceral feel for finance on any level.
A pearl of wisdom, Mr. President, as you continue along this dangerous and disastrous financial path: Remember the aphorism "Don't count your chickens before they hatch.” In other words, don't tout your profits until after you have realized your losses.
Visit www.armstrongwilliams.com .
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