Each morning, Bill Scher and Terrance Heath serve up what progressives need to effect change on the kitchen-table issues families face: jobs, health care, green energy, financial reform, affordable education and retirement security.
MORNING MESSAGE: Wall Street, Guilty As Charged
OurFuture.org’s Richard Eskow: “In a piece called ‘Wall Street: Not Guilty,’ financial columnist Roger Lowenstein attempts to defend Wall Street against allegations that it’s a viper’s nest of rampant criminality. His mischaracterization, mockery, and vague suggestions of McCarthyism are strident, flat, and fail to get the job done. But Lowenstein’s piece is well worth reading, if only as a case study in the moral and cognitive blindness that’s reached epidemic proportions in influential Washington and Wall Street circles.”
New Investigation Into Wall Street Crimes
NY State AG opening new investigation into financial crisis. NYT: “The New York attorney general has requested information and documents in recent weeks from three major Wall Street banks about their mortgage securities operations during the credit boom, indicating the existence of a new investigation into practices that contributed to billions in mortgage losses … The inquiry appears to be quite broad, with the attorney general’s requests for information covering many aspects of the banks’ loan pooling operations…”
Sen. Maj. Leader Reid caught in debit card fight. The Hill: “Reid says he will vote with [Sen. Dick] Durbin [for keeping a cap on fees] … [But] Reid has also done [Sen. Chuck] Schumer and his [banking] allies a big favor by promising a vote on [Sen. Jon] Tester’s controversial amendment, which Durbin wanted to keep off the legislative agenda.”
Saving Ryan’s Privatization
Newt Gingrich scrambles to soothe conservative livid at his slap against the House GOP Medicare plan. W. Post: “His campaign … released a statement and a video clarifying that he wants to repeal the health-care law backed by President Obama … ‘I’ve gone around the country for three years giving speeches attacking Obamacare,’ Gingrich told a huddle of reporters [in Iowa]. ‘Now, somebody watches 22 seconds of a TV show and says, “Oh, what’s happening?” Nobody said to Reagan, “Oh, you must be soft on communism because you said, ‘I like Gorbachev.’” … [One voter] approached Gingrich after his speech and called him a ‘disgrace’ for criticizing the Ryan proposal.”
House Budget Chair Paul Ryan equates Medicare with welfare in major speech. Digby: “[TPM reports,] ‘Ryan reframed the entitlement cuts in his budget as “strengthen[ing] welfare for those who need it,”‘ … If he thinks that calling Medicare ‘welfare’ is going to endear him to senior citizens, I think he’s more than a little bit out of touch.”
Ryan also attacks main cost-control tool of President’s health reform law. Wonk Room’s Igor Volsky: “Ryan’s attacks come less than a week after 42 freshmen Republican members of Congress sent a letter urging President Obama to abandon so-called ‘Mediscare’ tactics against Ryan’s plan. From the speech: … ‘it relies on a plan to control costs in Medicare that would give a board of 15 unelected bureaucrats in Washington the power to deeply ration care’ … The attacks are inaccurate because the [board's] members are actually confirmed by the Senate and their plan to reduce spending cannot ‘include any recommendation to ration health care…’”
Ryan makes clear he’s more interested in tax cuts for the wealthy than cutting the deficit. TNR’s Jonathan Chait: “‘Green-eyeshade arithmetic’ is a classic supply-sider catchphrase. It’s meant to disparage traditional fiscal conservatives concerned primarily with paying down the debt. Reducing the deficit is nice, but growth is what really matters, and that relies upon low upper-bracket tax rates. Ryan likewise adopts the Norquistian claim that bipartisan budget deals are bad because the tax hikes happen but the spending cuts don’t.”
Debt Limit Not Triggering Market Panic … Yet
Wall St. calm, assuming Congress won’t let America default, despite technical reaching of debt limit yesterday. LAT: “Wall Street analysts believe the U.S. will raise the debt limit by the Aug. 2 deadline rather than risk a default on securities. A default would sharply raise the interest rates investors would demand in the future. ‘The likelihood of an actual default, that Treasury misses an interest payment, we would say is very remote,’ said Terry Belton, head of fixed-income strategy for JP Morgan Securities Inc. ‘But if it’s not raised by the end of July, the markets would get very jittery then.’”
Politico introduces the “default deniers”: “They are the newest breed of government skeptics, the swelling ranks of Republicans who don’t believe the Obama administration when it says a failure to raise the debt limit will prove catastrophic … House Speaker John Boehner (R-Ohio) validated the default deniers Sunday, saying, ‘I understand the doubts.’ … Alabama Sen. Jeff Sessions … accused the White House of scare tactics … It would be more like a partial government shutdown, [PA Sen. Pat] Toomey said.”
Use the “People’s Budget” to move the debt limit debate to the real center, argues Robert Reich: “We can fortify the President and congressional Democrats and prevent them from moving further right by doing exactly what the Tea Partiers are doing — but in reverse. Call it budget Jujitsu … No cuts in Medicare and Medicaid or Social Security. More spending on education and infrastructure. Pay for it and reduce the long-term budget deficit by cutting military spending and raising taxes on the rich. The People’s Budget is the template.”
House GOP social spending bill would set spending levels back a decade, when the country had less people. Politico: “…it underscores the often heavy concentration of cuts from programs most sensitive to low-income families …”
Earlier spending cut deal won’t actually cut spending, at least this year. TPM: ” It turns out the six-month spending bill Congress passed in April increased discretionary outlays through the remainder of the fiscal year by a bit over $3 billion … the approximately $38 billion in advertised cuts spanned the entire federal budget, including locked-in ‘mandatory’ spending programs, and it reflected reductions in ‘budget authority’ — how much the government is allowed to spend — as opposed to projected ‘outlays’ — how much the government truly will spend. When viewed more narrowly — how many fewer dollars will the government spend this year as a result of this bill — the results flip … overall, CBO finds that the bill Congress passed in April will result in about $122 billion in aggregate spending cuts over 10 years.”
Federal workers bristle at proposal to weaken pensions. W. Post: “A proposal to significantly increase payroll deductions of federal workers to contribute to the federal pension fund may make public service less attractive and possibly hasten an exodus among current workers eligible for retirement, some observers and workers said Monday. The Washington Post reported Sunday that lawmakers and White House officials are considering the proposal as a way to help trim the budget.”
Senate Vote On Oil Subsidies
Senate to hold procedural vote on bill to end Big Oil subsidies tonight reports The Hill.
While likely presidential candidate Jon Huntsman backed off support for “cap-and-trade,” he embraces climate science in Time interview: “All I know is 90 percent of the scientists say climate change is occurring. If 90 percent of the oncological community said something was causing cancer we’d listen to them.”
Lobbyists Fight Campaign Finance Disclosure Plan
Federal contractors don’t voluntarily disclose political donations to third-party groups, finds USA Today: “None of the top five contractors publicly reveals specific amounts donated to trade associations, such as the U.S. Chamber of Commerce. Such disclosure would be required under an executive order President Obama is considering …”
Did The Auto Bailout Save America?
TNR’s Jonathan Cohn revisits the auto bailout, and how it saved America: “By intervening as he did, Obama may have saved the country, or a significant chunk of it, from depression-like conditions … According to Labor Department statistics, the four states in which the unemployment rate has declined most significantly in the last year are, in order, Michigan, Illinois, Indiana, and Ohio–the four states where what we used to call the Big Three are based.”
South Carolina latest state to pursue cutting unemployment benefits reports HuffPost.
WH refuses to send trade deals to Congress, until GOP backs expanded aid to displaced workers. NYT: “The announcement puts the White House in line with Congressional Democrats who have made expanded benefits a condition of their support for the trade deals, and at loggerheads with Republicans who say the government cannot afford the cost … a range of business groups have sided with the White House, supporting the expansion as a necessary step alongside passage of the trade deals.”