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.
MORNING MESSAGE: Conservative Economic Sabotage
OurFuture.org’s Dave Johnson: “For two years they followed a strategy of blocking everything and blaming the President for not making people’s lives better. The strategy succeeded and now they are determined to carry it through to the next election. They are blocking an extension of unemployment benefits, calling for an end to ongoing infrastructure development like high-speed and commuter rail and alternative energy, and have made it clear that any new efforts to stimulate the economy are out of the question. Many are starting to worry about the terrible effect these positions will have on the economy, and are calling it deliberate sabotage.”
Deficit Commission Moves To Final Vote
New liberals plans show deficit hysterics the sensible path to fiscal stability. NYT: “The liberal plans’ differences with centrists and conservatives include the following … While other debt-reduction plans would take effect as early as 2012, the progressives oppose any austerity measures until perhaps 2015, once unemployment is at or below 6 percent … Most of the plans call for immediate additional stimulus measures … All the plans would reduce projected spending for the military, but the liberal plans would cut deeper … While centrist plans would raise [Social Security] payroll taxes for the affluent and reduce benefits scheduled for many new retirees in future decades, the progressive plans would only raise taxes to make the program solvent until late in the century.”
Deficit commission co-chairs trying to tweak their proposal and maximize support for Wed. vote. WSJ: “Precise details of the changes couldn’t be learned … Several people familiar with the process said it was still impossible to gauge the outcome … Winning 14 votes [to make a formal recommendation to Congress] appears unlikely given the political makeup of the committee … If the panel wins close to a dozen votes for its proposal, some of the ideas could be incorporated into the White House’s 2011 budget proposal …”
Dem member suggests an agreement could happen. Politico: “One Democratic commission member said over the weekend that the past week of consultations ‘has made some good progress. I think we’re going to surprise some people.’ But that member said that getting a 14 vote majority of the commission’s 18 members, which Democratic congressional leaders have promised would trigger a vote on the package, ‘is going to really limit the ground that could be agreed on.’”
Deficit commission executive director Bruce Reed praises Simpson-Bowles plan for mirroring draconian British Tory plan. McClatchy quotes: “Our plan, in many ways, resembles the Conservatives’ plan in Britain. Theirs moves more quickly, because the U.K. has to. Our recovery is a little more fragile, and our debt problem, although incredibly serious, is not quite as urgent, because our problems aren’t as bad as the other guys’. That gives us a little more time to phase in these tough changes. But not much.”
“Cutting the deficit and debt is the preferred prescription for the economy among 39% of Americans” reports USAToday, in a piece that argued the public is clamoring for deficit reduction.
Former Clinton aide argues President should cut “mammoth” deficit reduction deal with GOP. NYT: “William A. Galston [said] the president should pivot from recent recommendations by the co-chairmen of a bipartisan deficit reduction panel to propose a mammoth deal with Republican leaders. Its potential elements: fresh economic stimulus through a temporary payroll tax ‘holiday,’ new infrastructure spending, a discretionary spending freeze, a plan to shore up Social Security’s finances and a comprehensive tax overhaul. Republicans could spurn the offer and face charges of obstruction, or compromise and burnish Mr. Obama’s reputation for leadership.”
Defense Sec. Gates looks to deficit commission to spend less on veteran health care. NYT: “The panel is considering proposals to increase fees for military retirees working for civilian companies, but it would also require employers to reimburse the government for a share of the health insurance costs of those on their payroll who opt for Tricare. That measure alone, described as an effort to make civilian employers pay ‘a normal business expense,’ could recoup $3 billion annually for the Pentagon.”
Jobless Aid, Tax Cuts, Government Funding Face Congress
GOP senators need to decide by Friday whether to approve funding to keep our government open. The Hill: “Republican senators stand to lose nearly $2 billion in project money they requested for their home states if they stick with their leadership and block a year-end omnibus spending bill. This has given Democratic leaders some hope that they might be able to pick up a few Republican votes … If Republicans unite behind Senate GOP leader Mitch McConnell (Ky.), however, Congress would be forced to pass a stop-gap measure that would likely freeze spending at current levels.”
Unemployment insurance extension runs out tomorrow. Bush tax tax cuts expire at end of December. CNN previews final congressional session of the year: “On Tuesday, President Obama will meet with congressional leaders on both sides of the aisle to tackle the extension of the Bush tax cuts … It looks increasingly likely that hundreds of thousands of people will start running out of extended unemployment benefits this week … [But] Congress may take up [an unemployment benefits] measure during December, either as stand-alone legislation or as part of a bigger bill.”
Dems still divded on tax cuts. WSJ: “Some Democrats are ready to accept a temporary extension of all tax cuts. But there is also growing interest among other Democrats in a compromise that would keep them in place only for families with income up to $1 million. Administration officials, for their part, have opposed making upper-income tax cuts permanent, but are widely viewed as being willing to accept an extension of a year or two … The result could be a protracted series of votes in both chambers, and a weeks-long debate, before the compromise expected by many in Washington will be reached.”
Estate tax repeal expires at end of the month too. Bloomberg: “A new tax on multimillion-dollar estates may emerge as the final hurdle to a deal that preserves most or all of former President George W. Bush’s tax cuts, analysts said … three main factions have formed in the Senate, none of which has the 60 votes needed … One includes Republicans such as South Carolina’s Jim DeMint who favor permanent repeal. Another is led by Democrats including Majority Leader Harry Reid who support a top rate of 45 percent that would apply after a $3.5 million tax-free allowance. A third faction, led by Arizona Republican Jon Kyl and Arkansas Democrat Blanche Lincoln and embraced by Republican leader Mitch McConnell of Kentucky, backs setting the top rate at 35 percent after a $5 million exemption.”
Global Climate Talks Resume
Low expectations for international climate summit starting today. Reuters: “The 12-day meeting … will seek to revive negotiations stalled after last year’s Copenhagen summit meeting fell short of a binding United Nations treaty to slow global warming. Delegates began arriving Sunday for the talks that will seek agreement on lesser measures, like a ‘green fund’ to channel aid to poor nations and new ways to share clean technologies and to protect tropical forests that absorb carbon as they grow.” More from Time’s Bryan Walsh.
Politico describes US strategy: sell Plan B. “Cap-and-trade legislation Obama promised two years ago on the campaign trail is dead and buried … The State Department’s Todd Stern will be the face of the Obama administration during the two-week meeting. His job is to sell Plan B: a suite of Environmental Protection Agency climate regulations and billions of dollars in renewable energy stimulus bill spending that the White House says would curb domestic emissions 17 percent below 2005 levels by 2020 … a former top Costa Rican diplomat, said she’s not concerned about Obama’s inability to get a climate bill signed into law. ‘The expectation of everyone is the United States will comply with its 17 percent’ target, she said. ‘How they do it is completely a domestic affair.’”
Northeast states using regional cap-and-trade revenue to plug budget gaps instead of its stated purpose. NYT: ” Each state is supposed to use its share of the money raised to invest in renewable energy and to promote energy efficiency and consumer benefits, like programs that help low-income electricity customers pay their utility bills. But the money is proving too much of a temptation for states not to use in other ways.”
NYT’s John Harwood suggests Obama could strike energy deal with GOP: “In theory, Republicans and the administration could find common ground on energy, from new energy efficiency steps to expanded use of nuclear power. Senator Lindsey Graham, Republican of South Carolina, has speculated that the White House could even find bipartisan support for a limited cap on carbon emissions…”
WI Gov.-elect Scott Walker’s plan to kill high-speed rail link threatens Minnesota. The Capital Times: “If Wisconsin refuses to get on board and Walker turns away $810 million in federal stimulus money to pay for rail service between Milwaukee and Madison, it is unlikely Minnesota would see its largest metropolitan area connected to the proposed nine-state Midwest rail line anytime soon … despite Walker’s pledge, Minnesota is moving forward with a series of meetings in Minnesota and four in Wisconsin … to obtain information for an environmental impact study on roughly a dozen proposed rail routes between the Twin Cities and Chicago via Milwaukee … In the works for more than a decade, the plan calls for utilizing 3,000 miles of existing rail lines to connect nine Midwest states and link such cities as Omaha, Cleveland, St. Louis and Minneapolis with Chicago as the center hub.”
Wall Street Reform Taking Effect
Credit default swaps plummet following new Wall St. regulations. Bloomberg: “Trading in credit-default swaps, Wall Street’s fastest-growing business before the credit crisis, has tumbled 40 to 60 percent from three years ago as banks prepare for new regulation of derivatives. The declines estimated by executives at four of the biggest dealers of swaps means lower profits at firms that used to get as much as two-thirds of credit-market trading revenue from the derivatives.”