Each morning, Bill Scher and Terrance Heath serve up what progressives need to affect change on the kitchen-table issues families face: jobs, health care, green energy, financial reform, affordable education and retirement security.
Fed Audit Endangered?
First it was derivatives, now it’s auditing the Fed that Dems are looking to ditch on the financial reform bill. But Matt Yglesias doesn’t see it happening: "I find it very hard to imagine the Obama administration vetoing its own financial regulation bill over a popular, populist measure. Presumably that’s why they’re trying to kill it in the Senate. Paradoxically, though, the harder Obama struggles against this idea, the more incentive conservative Republicans with no intention of voting yes on the bill have to vote with Sanders. That way, the whole package might fall apart in the Senate and nothing whatsoever will pass. This is pie-in-the-sky, but I think that if Congress wants to get serious about supervising the Fed better what they ought to do is scrap the ‘dual mandate’ in favor of something clearer. The nature of the dual mandate is that it’s impossible to say if the Fed is meeting its mandate, and thus impossible to hold anyone accountable. As an alternative, Congress could set a statutory nominal GDP trend target or a price level trend target and hold the leadership of the Fed accountable based on how good a job they do of hitting the target."
Senate Democrats are targeting the rating agencies with new amendments to financial reform: "Sen. Al Franken has written an amendment to financial overhaul legislation that would seek to prevent securities underwriters from hiring rating agencies based on which ones proved most willing to give their deals the highest possible ratings. Senators Bill Nelson, D-Fla., and Charles Schumer, D-N.Y., have agreed to cosponsor the amendment, according to a spokesman for Franken. The amendment is expected to be formally introduced later this week. Meanwhile, Nelson is also preparing his own possible amendment that would seek to hold rating agencies more accountable once their ratings, akin to Good Housekeeping seals of approval, are handed out. Currently, agencies continue to monitor credit ratings only if they are paid to do so. Nelson’s proposal would mandate ongoing surveillance.
Max Baucus Meta-Nixes Bank Tax: "When Congress passed TARP back in the fall of 2008, they included a provision requiring the executive branch to devise a proposal for recovering the funds. The Obama administration delivered in January, with an idea for a temporary “bank tax” that would be paid by the largest financial services firms in the country and semi-offset the implicit subsidy that they get from implicit government guarantees. It was a good idea that congress ought to push further—make the tax permanent, for example. Max Baucus says no…"
Ezra Klien has an idea of the reason Fannie and Freddie aren’t in the financial reform bill: "What we do with Fannie and Freddie has more to do with our priorities for the housing market than our priorities for the financial system. The entities exist to make mortgages cheaper (I’ll get into the how of that tomorrow). Eliminate them, or substantially change them, and mortgages will get more expensive. You’re talking about taking a massive " albeit somewhat opaque " subsidy to the middle class and eliminating it. That is to say, the politics of reforming Fannie and Freddie are more like the politics of reforming the mortgage interest deduction than reforming financial regulation. That’s why the administration prefers to reform Fannie Mae and Freddie Mac in the context of a housing bill: The immediate effect of reform will be felt in the housing market rather than the financial sector, and you’ll likely need a basket of different housing reforms to ensure some semblance of a smooth transaction. Wrapping a housing overhaul in financial-regulation reform is like trying to run an ultra-marathon while climbing a mountain."
Spreading the Blame for the Spreading Oil
Smallest leak on damaged oil well capped: "Crews working to stem the tide of oil in the Gulf of Mexico capped one of the three leaking points Wednesday, a BP executive said. John Curry, director of external affairs for BP, said the leak that was capped was the smallest of three. Curry said the pipe was cut off and sealed with a slip valve. BP, which owns the damaged well, is responsible for the cleanup and costs of the massive oil spill. Workers with BP plan to start moving a four-story metal container Wednesday toward the spill that could get even worse. The company has a risky plan to lower the container 5,000 feet into the water off Louisiana and position it above a ruptured oil pipe. If successful, the container would sit there like an upside-down funnel, sucking up oil that would otherwise add to the growing slick in the Gulf of Mexico.
The oil spill in the Gulf may increase 12-fold if the dome-cap plan fails: "Oil leaking from a BP Plc well in the Gulf of Mexico could surge to 60,000 barrels a day if plans to cap it with a containment dome fail, Representative Edward Markey said yesterday after a meeting with industry executives. ‘The amount of oil per day could actually rise from 5,000 to 60,000 barrels,’ Markey, a Massachusetts Democrat, told reporters after meeting with company executives. ‘Although in a worst-case scenario, the most likely number was in a 40,000- barrel range.’ John Curry, a BP spokesman, said he didn’t have any worst- case-scenario data and could not comment. BP expects to have the dome in place on the seafloor and trapping oil within five days, Doug Suttles, chief operating officer of exploration and production for London-based BP, said at a press conference."
The White House made it clear: there will be no bailout for BP on the oil spill in the Gulf: "So let""s be clear about a few things: BP is responsible for " and will be held accountable for " all of the very significant clean-up and containment costs. They will pay for the mess they""ve made. Beyond clean-up and containment, BP must be held responsible for the damages this spill causes. To help make sure of that, the Administration " in the context of a comprehensive energy bill which would help move us to a clean energy future " strongly supports efforts on Capitol Hill to raise the Oil Pollution Act damages cap significantly above $75 million. Currently, under the Oil Pollution Act, if BP is found to be grossly negligent or to have engaged in willful misconduct or conduct in violation of federal regulations, then there is no cap under this specific law for damages. Simply put, the $75 million cap on damages under the Oil Pollution Act would not apply under these circumstances."
Small-government conservative Sen. David Vitter thinks the government should give BP more help: "If there’s any kind of wisdom here, it eludes me. BP’s oil rig is responsible for a potentially devastating oil spill, and the company was wrong when it insisted early on that this was a small, manageable problem. For a politician seeking re-election, the smart move would be to say the right thing: BP, this is your mess, and we’re going to hold you responsible. But Vitter " the one who considers government inherently ineffective and incompetent " wants BP to do less and government officials to do more. And while Vitter’s example is perhaps the most egregious, he’s not alone. Conservative red-state governors are demanding intervention, resources, and money from the federal government in response to the oil spill disaster."
BP "takes responsibility" for cleaning the Gulf Oil spill, while also passing the buck by blaming the owners of the rig itself: "Earlier in the day, BP CEO Tony Hayward reiterated his company’s dedication to clean up the spill, but he said that the explosion on April 20 that caused the spill and led to 11 deaths was not the fault of BP but the fault of the owners of the deep sea rig itself. ‘The drilling rig was Transocean’s drilling rig, it was their equipment that failed, it’s their systems, their processors that were running it,’ Hayward said. ‘We are responsible not for the accident, but we are responsible for the oil and for dealing with it and cleaning the situation up,’ Hayward said on ‘Good Morning America’ today. For its part, Transocean declined to take or assign blame for the accident at its Deepwater Horizon rig."
Oil cleanup chemicals worry environment watchdogs: "Oil-dispersing chemicals used to clean up the vast BP spill in the Gulf of Mexico carry their own environmental risks, making a toxic soup that could endanger marine creatures even as it keeps the slick from reaching the vulnerable coast, wildlife watchdogs say. The use of dispersants could be a trade-off between potential short-term harm to offshore wildlife and possible long-term damage to coastal wildlife habitat if the oil slick were to reach land. The U.S. Environmental Protection Agency has approved 14 dispersants for use on oil spills, including Corexit, manufactured by Nalco Holding Co. of Naperville, Illinois."
Against a torrent of oil, finally a trickle of responsibility breaks through: "In what could be the first inklings of a mounting wave of political push back against the reckless drill-baby-drill mentality, several political leaders from coastal states including California Gov. Arnold Schwarzenegger (R) and six U.S. senators, have spoken out in defense of their states’ coastlines and common sense by calling on Obama to reverse his offshore drilling decision. The senators included Ben Cardin (D-Md.), Robert Menendez (D-N.J.), Barbara A. Mikulski (D-Md.), Frank R. Lautenberg (D-N.J.), Sheldon Whitehouse (D-R.I.), and Bill Nelson (D-Fla.), who, as I noted in an earlier post, wrote a letter [PDF] to Sens. John Kerry (D-Mass.), Lindsey Graham (R-S.C.), and Joe Lieberman (I-Conn.) in March calling on the three to keep offshore drilling out of the climate bill they were working on. That letter was unfortunately ignored, but now the senators have a more visible platform from which to trumpet their concerns, and it""s good to see that they are using it."
Jed Lewison tries to measure the long-term effects of the oil spill on the Gulf’s economy: "While shipping traffic remains at normal levels, and apparently only one oil platform and two gas platforms have been evacuated, already the fishing and shellfishing industries are shutting down, their boats anchored and processing operations silent. Grim faces all around. Chances are that, even if the worst does not occur, the $75 million limit on damage liability will mean that lots of people and businesses, some of them still suffering the economic after-effects of Hurricane Katrina, will get screwed. One of the chief victims of the spill will be the wetlands of the Mississippi Delta. Those 300,000 acres of coastal wetlands don’t just include 10 national wildlife refuges where hundreds of species live, but also offer protection against hurricanes to the 2 million residents of the area. They provide a living for hundreds of thousands of people. The latest trajectory map from the National Oceanic and Atmospheric Administration shows the oil slick creeping ever closer to those wetlands."
Mary Landrieu says she’s keeping BP’s campaign contributions. Digby says BP " and big oil " are getting what they paid for: "Landrieu really couldn’t be more of a bought and paid for . This isn’t your normal "industry vs government" argument. She has a whole bunch of constituents who are going to be ruined by this. And unless Rush and the boys succeed in brainwashing all of them that Obama personally blew up this well for political reasons, they are going to want someone to pay. It sure doesn’t sound like Landrieu’s willing to fight for them on that. We’ll see. Maybe everyone in the Gulf is philosophical about some multinational corporations buying off their political representatives and ruining their state and way of life. Landrieu probably shouldn’t count on it though."
Obama should to link any drilling moratorium to an all-out conservation effort: "True, climate legislation has entered the rigor mortis stage " and it was flailing in a severely compromised state even before it collapsed. There isn’t likely much Obama can do to revive it at this point. But he could pledge to link a drilling moratorium to an all-out effort to conserve at least as much oil as we would have gained from offshore drilling. Granted, if the U.S. were to implement a significant conservation program, oil prices would drop, and someone, somewhere else, would likely increase consumption, offsetting our efforts. But it’s also true that our intransigence viz climate legislation is helping scuttle any meaningful global climate accord. A serious conservation effort could break that stalemate " and spur a global rush to conserve oil. How could Obama achieve such a thing? There are a variety of mechanisms, not all of which require congressional approval."
Make room on the crazy train. Michael Tomasky announces the birth of (yet another) new movement " the "BP Truthers": "This budding movement holds that the Obama administration planned or executed the massive BP oil spill, or at least let it happen. Why? Well, obviously: because this gave the tree-hugging, soft on planet Earth administration just the excuse it needed to cancel the offshore drilling scheme the president announced a while back. The name of course comes from the 9-11 truther movement on the left, which I hasten to add I considered nutty and offensive, that Bush and Cheney let 9-11 happen. That was crazy. The difference is that I don’t believe that any major news outlets gave the 9-11 truther movement serious treatment, whereas the BP truther movement is getting oxygen…well, guess where."
Terrorism vs. Due Process
All Over The Map On Immigration
Americans are all over the map on immigration. A new poll says Americans are "sympathetic" on immigration, but desire "secure borders": "Eight in 10 Americans are concerned that illegal immigrants burden schools, hospitals and other government services, and 77 percnet worry that they drive down wages, the poll finds. Yet 77 percent are concerned that stricter laws would mean illegal immigrants and their families who have lived productively in the USA for years would be forced to leave. The seeming contradiction reflects the difficulty in grappling with the issue, said Tomas Jimenez, a fellow at the non-partisan New America Foundation."
Eighteen states " fifteen with Republican governors " say they won’t participate in the high-risk pools provided by the Affordable Care Act, for people who have been uninsured for over six months: "So what have they chosen? The Washington Post tells us that 18 states have said they won’t do it, which means the federal government will be taking care of citizens in those states who need to be in a high-risk pool. They are: Alabama, Delaware, Florida, Georgia, Hawaii, Idaho, Indiana, Louisiana, Minnesota, Mississippi, Nebraska, Nevada, North Dakota, South Carolina, Tennessee, Texas, Virginia, and Wyoming. Notice anything about that list? Fifteen out of the 18 are ruled by Republican governors (the exceptions are Delaware, Tennessee, and Wyoming), and two of the remaining three are conservative states where conservative Democrats managed to get elected. And you’ve got the entire Deep South in there."
Forget VA Attorney General Ken Cuccinelli’s campaign against the bare breasts of Virtus, it’s his suit against climate change that’s dangerous: "As Courtney Stuart first reported last week in Charlottesville’s The Hook, Cuccinelli’s office quietly filed a civil investigative demand (or CID, which is basically a subpoena) with the University of Virginia on April 23, giving the school 30 days to produce more than 10 years’ worth of documents related to the state-funded research of a former faculty member, Michael Mann. Operating under the Virginia Fraud Against Taxpayers Act, the CID seeks from the university, among other things, ‘any correspondence, messages or emails’ to or from Mann and 40 named climate scientists; any documents sent to or from Mann that reference any of those 40 scientists; and any ‘documents, things or data’ submitted in support of any of five different grant applications that amounted, in total, to almost $500,000. The university is also expected to turn over ‘any and all emails or pieces of correspondence from or to Dr. Michael Mann since he left the University of Virginia."