Progressive Breakfast is the morning roundup of what progressive movement members need to know to start the day.
$900 Billion for Main Street
More than 200 top economists and labor leaders rally behind Institute for America’s Future’s $900 billion, 2-year Main Street Recovery Program, to get our $15 trillion economy back on track. Read and endorse the plan here.
A sampling of key endorsers: John Sweeney, Anna Burger, Jane DʹArista, Andrew Stern, Gerald McEntee, Ron Gettelfinger, Dennis van Roekel, Leo Gerard, Mike Wessell, David Bonior, James Galbraith, Heidi Hartmann, Robert Johnson, Robert Kuttner, Julie A. Matthaei, Jeff Faux, Dean Baker, Carl Pope
Reuters: “‘Public investments are far more efficient at stimulating the economy than tax cuts for either individuals or businesses are,’ the report said. Data suggests only 20 percent of recent tax rebates to stimulate the economy were spent, with the rest saved or used to reduce consumer debt, the report said. It recommended $75 billion in infrastructure spending in the first year and $150 billion in the second, and $50 billion in green technology investments in both years.”
Bloomberg: “The $900 billion proposal, or $450 billion for each of the next two years, ‘should define the floor, not the ceiling of what needs to be done,’ the group said. The package would include $15 billion for research and development into new technologies, $70 billion for health care and $80 billion for poverty reduction. ‘I don’t know that we have any way of using past methods or models to gauge how big it should be,’ said Galbraith …’My sense is that I would go for as high a number as you can get, and hope you can get traction and some results[.]‘”
Grist’s Kate Sheppard: “[IAF] outlines six areas of green infrastructure in need of those funds: ‘retrofitting buildings to improve energy efficiency, expanding mass transit and freight rail networks, constructing “smart” electric-grid systems, increasing capacity for generating power from wind and solar energy, and developing carbon capture technologies and next-generation biofuels.’ The report emphasizes that $50 billion ‘should be considered a minimum and could be expanded if appropriate plans can be rapidly developed.’”
Borosage at HuffPost: “Welcome to the new ‘post-partisan’ world, in the silly season on political punditry. Turns out the center has triumphed once again. But that, of course, depends on what you mean by center … In scope and substance, Obama’s plan tracks the elements of the Main Street Recovery Program [and now] Republicans are reinventing their Keynesian heritage.”
OurFuture.org’s David Sirota says such a plan should be matched with a new approach to trade: “with Obama pledging to create 2.5 million jobs, he now has a political incentive to use every means at his disposal – including trade policy reform – to reach that promised goal. The fact is, you can’t have an effective industrial policy without a trade policy that supports it.”
The Back Forty: Obama moves on broadband infrastructure
Latest false conservative attack: Japan Sucks! Just Like FDR!
Amity Shlaes, already discredited after her baseless claims attacking the New Deal and Keynesian economics, returns to the W. Post opinion page to claim government spending on infrastructure won’t work because it didn’t in Japan during the 1990s.
Except that it did.
AFP reports from Stockholm, where Paul Krugman is accepting the Nobel Prize for economics:
“I think we need to be grateful to the Japanese for … simply (giving) us the realisation that such things can happen and which policies do and don’t work,” he said.
“The experience of Japan in the 1990s was that indeed government spending, while it may not produce a permanent cure, can greatly alleviate the pressures on the economy,” he said.
Krugman earlier wrote in NYT that Japan’s mistakes were in not spending enough:
In 1996-97 the Japanese government tried to balance its budget, cutting spending and raising taxes. And again the recession that followed led to a steep fall in private investment.
What made fiscal austerity such a bad idea both in Roosevelt’s America and in 1990s Japan were special circumstances: in both cases the government pulled back in the face of a liquidity trap, a situation in which the monetary authority had cut interest rates as far as it could, yet the economy was still operating far below capacity.
And we’re in the same kind of trap today — which is why deficit worries are misplaced.
Did I mention that Krugman WON THE NOBEL PRIZE FOR ECONOMICS?
While Yglesias mocks Shlaes’ lack of economic qualifications.
Investors Business Daily: “Putting the money to immediate use shouldn’t be a problem, considering how many transportation projects are ‘shovel ready.’”
Archpundit: “This stuff isn’t even the core of the investigation. This is what they gathered off of a phone tap in a little over one one-half months. This is the tip of the iceberg. There have to be some federal agents and prosecutors kicking themselves for not tapping his phone before.”
W. Post speculates on SEIU involvement, but Marcy Wheeler discerns that the SEIU likely will not be implicated in wrongdoing: “I would imagine that Fitzgerald has heard SEIU’s side of any conversations with Blago, and found nothing much there to be interested in.”
While some conservatives widly speculate about Obama’s interaction with Governor Rod Blagojevich, Newsweek’s Mike Isikoff, on MSNBC’s Rachel Maddow Show, notes if Obama did directly talk with Blago, the Gov was bugged so it’d be on tape.
NYT piece on Obama connections raises blogger eyebrows. TPM: “Shorter New York Times: By lobbying for ethics reform, Obama showed he could not escape the murky world of corrupt Chicago pols.” Attytood: “this Times story is Day One of what is going to be a brand new silly season in American politics, just when you thought it was safe.”
Obama speaks on Employee Free Choice Act
Q: On card-check protection [which would make it easier for unions to organize], we’ve heard that there might be a delay on that, or it might not be an immediate priority? Also, on NAFTA, we’ve heard that you might support maybe a study and then a report, instead of a wholesale reworking of the agreement right away?
O: Well look, my economic team is reviewing these issues. You know, I’ve consistently said on trade issues that I want environmental and labor provisions that are enforceable in those trade agreements.
But I also have said that I believe in free trade and don’t think that we can draw a moat around the American economy. I think that would be a mistake.
When it comes to unions, I have consistently said that I want to strengthen the union movement in this country and put an end to the kinds of barriers and roadblocks that are in the way of workers legitimately coming together in order to form a union and bargain collectively.
My economic team is going to put together a package on trade and on worker issues that will be presented to me. I don’t want to anticipate right now what sequences will be on these issues.
Dean Baker debunks EFCA myths pushed by W. Post: “Workers do not currently have the right to a secret ballot in elections deciding whether or not they will have a union. The employer has the option to recognize a union based on card check (a majority of workers sign a card indicating their desire to join a union) or to demand an election certified by the National Labor Relations Board. The Employee Free Choice Act that will be considered by Congress in the next session gives this choice to workers. Under the legislation, workers could organize by card check, but they can also petition to have an election overseen by the NLRB. Therefore it is incorrect for the Post to assert that the bill’s ‘intent [is] to eliminate secret ballots in union elections.’”
FAIR finds W. Post relying on anti-union representatives.
House Vote Today on Auto Rescue
W. Post: “The White House and congressional Democrats yesterday reached an ‘agreement in concept’ on a plan that would throw a government lifeline to the faltering Detroit auto industry but require the auto giants, their workers and creditors to quickly negotiate a path to profitability or face the prospect of bankruptcy … The agreement … is set for a vote in the House today … Sen. John Ensign (R-Nev.) said he plans to use Senate rules to block the measure, which could delay a vote until early next week.”
Krugman from Stockholm WHERE HE IS RECEIVING THE NOBEL PRIZE notes it’s not just the Big 3: “Everyone here seems to be talking about two things: the fate of the auto industry, which is in almost as much trouble in Sweden as it is in the United States…”
Leonhardt also notes the retiree benefits discussion does not compare apples to apples: “The Big Three built up a huge pool of retirees long before Honda and Toyota opened plants in this country.”
American Prospect’s Brentin Mock: “As Congress looks to attach environmental requirements to the automaker bailout, it should consider not just the Northern Big Three manufacturers but also the Southern Big Three: Honda, Hyundai, and Mercedes Benz.”
More conditions? Bloomberg’s Jonathan Weil argues Chrysler should open up its books, which GM and Ford already do. Robert Reich wants the auto stakeholders to put up $2 for $1 of taxpayer money.
Seeing The Forest: “The big cost problem with the American car companies is that Japan, Germany and other countries provide health insurance and good pensions, while the United States does not. This means that the American auto companies have to try to compete while providing these benefits to their workers against companies that do not provide those benefits. Republicans say that the cure is for companies to stop providing these benefits. And the way to get that is to break the unions. That is their beef with the auto loan discussion.”
Scott Lemieux of Lawyers, Guns and Money: “Call me crazy, but I’m inclined to think of the generous wages and benefits accorded to their workers is a point in Detroit’s favor. (And if you think that wages at non-union American factories will remain at their current level if Detroit stops competing for labor, I have some beautiful condos in Flint to sell you.)”
Progressive Blue: “Iowa Congressman Bruce Braley forming Populist Caucus”
NYT: Bank of America starts to cave to pressure from Republic Windows and Doors workers.
Naked Capitalism on financial bailout oversight: “Panel to Criticize Handling of Bailout Wall Street Journal. Oh, this will be so much fun! I hope I find the time to watch C-Span. Should be great theater. The problem, however, is that this will only be theater, since the TARP legislation puts the Treasury Secretary outside the reach of the law.”
Econobrowser: “Current business cycle forecasts see a July or August 2009 trough and a jobless recovery until March 2010″
MyDD: “Obama Likely To Announce Top Energy And Environment Spots This Week”