Progressive Breakfast is the morning roundup of what progressive movement members need to know to start the day.
Today’s Number is $850B
Bloomberg cites one Obama aide to report the new administration will ask for an $850B economic recovery package: “Obama’s transition team believes the amount, about 6 percent of the U.S.’s $14 trillion economy, is needed to reverse rising unemployment…”
AP reports Obama has begun to deliver that message to Congress: “Obama has not settled on a grand total, and the final figure could be smaller [than $850B]. But after consulting with outside economists of all political stripes, his advisers have begun telling Congress the stimulus should be bigger than the $600 billion initially envisioned, congressional officials said Wednesday.”
LA Times reports Obama is still looking at a range between $600B and $1T, and notes Pelosi and Reid have come in lower so far.
LA Times also rounds up emerging conservative attack lines: “Republicans are wary of some of the proposals put forward by groups that are talking to Obama’s transition team. They cite a report by the U.S. Conference of Mayors listing myriad projects cast as vehicles to create jobs and boost the economy. Those include a dog park in Hercules, Calif.; a bike path in San Diego; and a $1.5-million push to curb prostitution in Dayton, Ohio. ‘My fear is it will be a tool for all kinds of pet spending projects, for wasteful pork barrel projects and redistribution of wealth,’ said Pat Toomey, president of Club for Growth, which promotes fiscal conservatism. Toomey said the group may run ads opposing the stimulus package.”
As Ambinder warned earlier: “Watch for Republicans to settle on a handful of objectionable items and create the impression that the entire enterprise is suspect.”
Furthermore, 1) This is just a mayoral wish list, not even the actual proposal.
2) These small-dollar items may well have positive economic impact for those areas, if they are part of an overall revitalization strategy.
3) They may not, but conservatives have shown no ability to make good assessments regarding what investments are economically sound. Obama has proposed an “infrastructure bank” to make these calls on the merits. (See our “Investment Deficit In America” report for more.)
Stateline: “The nation’s cities and counties are asking Obama transition officials to give them most of the infrastructure money from the multibillion-dollar economic stimulus package, setting off a dispute with the states over who can launch transportation projects the fastest.”
Ambinder reports “The Democratic coalition is ready to fight. [Today,] liberal interest groups and unions will unite under the Campaign for Jobs and Economic Recovery Now (C-JERN) banner to pressure Congress to pass Barack Obama’s economic recovery package.”
Public Plan Option Is Non-Negotiable
ABC’s The Note reports on an Institute for America’s Future news conference (audio here) releasing a new report from Prof. Jacob Hacker: “The Case for Public Plan Choice in National Health Reform.”
ABC cites Rep. Pete Stark, key House subcommittee chairman: “‘In the absence of a public plan you would have to so strictly regulate [private] health plans that they would all have to become public plans,’ said Rep. Pete Stark, D-Calif., chairman of the House Ways and Means Health sub-committee. Stark spoke out on Wednesday because he is concerned that any effort to reform the private health-insurance market will prove ineffective if Americans are not offered the kind of Medicare-style government option contained in Obama’s 2008 campaign proposal.”
Hacker’s report concludes: “Private insurance and public insurance have distinct strengths and weaknesses, and thus should be encouraged to compete side by side to attract enrollees on a level playing field that rewards plans that deliver better value and health to their enrollees. Public insurance has a better track record at reining in costs, while preserving access; it has pioneered key quality and payment innovations that have often set the standard for private plans; it is essential to set a standard against which private plans must compete to drive value and can be a source of stability for people.”
The Wonk Room’s Igor Volsky: “A public plan … because of its lower administrative costs and ability to bargain for better rates, lowers prices and saves Americans money. ‘The clearest evidence of the savings produced by the public plan is its premiums, which are estimated to be about 23 percent lower than comparable private insurance for the same set of benefits for the same population,’ the [Hacker] analysis found.
Health Care For America Now! Blog: “Advocates of real health care reform need to make sure that this critical part of the solution is not bargained away in a misguided attempt to placate those who see health care reform as a business opportunity, not a matter of the health of our families and our neighbors. This would be a tragic mistake.”
HealthBlawg’s David Harlow has some wonky follow-up Q&A with Hacker.
Government Executive’s Alyssa Rosenberg’s item on Hacker emphasizes how a public plan should be constructed: “Medicare’s relatively low overhead makes it a better model for a publicly run health insurance option for people without employer-provided coverage than the Federal Employees Health Benefits Program, [Hacker] said on Wednesday.”
Auto Industry Crumbles Some More
Rep. Fred Upton (R-Mich.) had thought an auto rescue would be done by Wednesday. He was wrong. NYT tries to take a peek inside the opaque negotiations between Treasury Secretary Henry Paulson and the auto industry.
Meanwhile, plants are shutting down and suppliers are going bankrupt.
HuffPost’s Steve Parker: “Chrysler has announced that 30 factories – all of their North American production plants – will close and remain that way until at least January 19th. In the meantime, the White House says President Bush is still ‘gathering information and looking at options,’ with some expecting an announcement this Friday, while two major carmaker suppliers have filed for bankruptcy.”
Earth2Tech: “General Motors has put the brakes on construction of a $349 million plant slated to produce engines for the extended-range electric Chevy Volt and compact Chevy Cruze in Flint, Mich. by 2010 … ‘It’s temporarily on hold as we assess our cash situation,’ GM spokesperson Sharon Basel told the Detroit Free Press today.”
ABC: “Chrysler says its union employees will not receive regular salaries for at least a month, forcing the workers to rely on state unemployment benefits and union-negotiated payments from Chrysler during the layoff. White-collar employees will likely get paid. The Chrysler shutdown comes on the heels of a warning to dealers that the automaker may halt financing for stocking showrooms.”
Naked Capitalism worries: “popular opinion seems to be moving to [bankruptcy] as the only way to get out of existing arrangements. The parallels to Lehman are scary. Outcomes are being driven by sentiment, not by analysis.”
Also notes: “…Cerberus has revived merger talks for Chrysler with GM … introduc[ing] an element of delay for two companies that have said they need a cash infusion in very short order.”
Salon.com’s Michael Lind describes the regional split in the Senate as a North-South economic civil war: “The non-Southern states, through their representatives in Congress and the executive branch, and with the help of enlightened Southerners, need to use the power of the federal government to put a stop to the Southern conservative race-to-the-bottom strategy once and for all.”
While conservative Senators try to lower wages for workers in a recession, Congress gets a raise.
Ron Kirk for USTR?
McClatchy reports Obama is “expected” to pick former Dallas Mayor Ron Kirk for U.S. Trade Representative, while other news orgs simply deem him a new “front-runner.”
Where does he stand on trade? Unclear.
“The jury’s out,” said Becky Moeller, president of the Texas AFL-CIO.
As mayor from 1995 to 2001, Mr. Kirk touted free trade. In a series of overseas trips, he pitched the Dallas area as an ideal trading partner.
A Dallas Morning News article from 3/7/02 (via Nexis) describes Kirk’s trade views during the primary campaign for the U.S. Senate against Ken Bentsen:
With just days to go, the Bentsen campaign contended that Mr. Kirk has sent mixed messages about his position on free trade … Mr. Kirk was in favor of free trade as Dallas’ mayor, even leading a contingent of civic leaders on a 10-day trade mission to China in May 2000, shortly after the House voted to normalize trade ties with that country.
But in a televised debate last week, Mr. Kirk suggested that he would have voted against a bill opposed by organized labor that would give President Bush unilateral authority to negotiate free-trade agreements.
On the Labor Secretary front, WSJ reports (via Political Wire) that “Harley Shaiken, a prominent expert on unions, Detroit and the U.S.-Mexican border, has emerged as a top candidate for the post of secretary of labor … Rep. Rosa DeLauro is also a top contender…”
UPDATE: More background from Sirota on Kirk, concurs that the “jury is out.”
GOPer for Transportation Secretary
Ryan Avent expresses disappointment over Obama’s choice of GOP Rep. Ray LaHood for Transportation Secretary: “It’s possible that Obama wants him for GOP outreach, or that the bold moves will come elsewhere — out of another department or a national infrastructure bank. And we don’t yet know who’ll be running the FTA, or what resources they’ll have. But this does seem to be strongly at odds with the adminstration’s language on energy, environmental, and transportation issues.”
Progress Illinois reviews the record: “So what can we glean about LaHood’s record on this issue? The moderate Republican has broken with his party over Amtrak funding, voting yes last summer to expand passenger rail service. In 2005, he told the Peoria Journal-Star that ‘we’ve got a good Amtrak system in Illinois and I don’t think we want to destroy it by talking about privatization.’ In 2006, he received a 66 percent rating from the American Road and Transportation Builders Association, a major transportation construction lobby. He also voted in favor of the Saving Energy Through Public Transportation Act of 2008, a bill to promote increased public transportation use that garnered string bi-partisan support. Other than that, we know very little.”
Michael Tomasky reviews the strategy: “What ‘transportation’ really means here in the nation’s capital is a never-ending battle between rail advocates and highway advocates … LaHood has relationships on the Hill — in that sense, it’s similar to the Daschle appointment — and can maybe bring a few moderate Republicans into the mass-transit fold. I suppose that’s the thinking. We’ll see how it works.”
Marc Ambinder reports Sen. Blanche Lincoln (D-AR) may not oppose the Employee Free Choice Act, and is “undecided,” contrary to an earlier report.
RBC’s Mark Kleiman rips Al Sharpton for opposing EFCA. “I wonder who greased Sharpton’s palm. Or is he merely desperate for attention…”