Wonkbook: Few details in speech; Dems may cut unemployment benefits; Obey plays hardball
Obama spoke from the Oval Office about plans to keep BP accountable and push for a comprehensive energy bill, though he stopped short of offering specifics: He didn't attach dollar amounts to the BP liability fund or the Gulf reconstruction effort, and he didn't demand a price on carbon or a level of renewable fuel production. This was a speech to respond to the BP oil spill speech, not a speech to push a climate bill. Obama will follow it up today by meeting with senior members of BP, including chairman Carl-Henric Svanberg and chief executive Tony Hayward, at the White House.
Elsewhere, FinReg conference grinds on, Senate Democrats are thinking of cutting unemployment benefits to attract Republican votes, House Appropriations Chair David Obey is considering blocking Afghanistan funding until state and local governments get some help, and the EPA said the costs of John Kerry and Joe Lieberman's American Power Act would be modest.
It may be a gray Wednesday in Washington, but it's always a sunny morning here at Wonkbook.
Missed the speech? Here's the transcript: http://bit.ly/b8YmnI
My take: "Obama's language was a close echo of the language he used in the health-care fight. 'There are costs associated with this transition,' he said, using a formulation many will remember from health care. 'And some believe we can’t afford those costs right now. I say we can’t afford not to change how we produce and use energy.' Similarly familiar was his reminder that 'I am happy to look at other ideas and approaches from either party – as long they seriously tackle our addiction to fossil fuels,' and his promise that 'the one approach I will not accept is inaction.'"
"The optimistic take, at least for environmentalists, is that this is the language and approach Obama uses when he really means to legislate. The pessimistic take is that Obama shied away from clearly describing the problem, did not endorse specific legislation, did not set benchmarks, and chose poll-tested language rather than a sharper case that might persuade skeptics." http://bit.ly/9L5N4O
Senate Democrats may cut back their jobs package, reports Carl Hulse: "Senate Democrats are exploring whether to eliminate an extra $25 a week in unemployment benefits, part of the economic stimulus legislation passed in 2009, as a way to cut costs and attract Republican votes for a stalled package of tax breaks, tax increases on the affluent and safety-net spending. Top officials said that change would save billions of dollars over the next six months and could lead to approval of an overall extension of jobless pay by making the legislative package easier to swallow for lawmakers worried about deficit spending."
The bill still has no Republican supporters: http://bit.ly/dv2waE
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Dave Obey is cutting off Afghanistan funding until local and state governments get help, reports David Rogers: "House Appropriations Chairman Dave Obey said he will hold off on new Afghanistan war funding until there is some resolution of a long-delayed economic relief bill extending aid to states and the jobless as well as tax breaks for individuals and business.…The so-called “extenders” bill - now bogged down in the Senate - carries with it $24 billion that Democrats want to help cash-strapped states meet their Medicaid payments next year. At the same time, Obey has been struggling to add up to $10 billion to the war funding bill to help local school districts avert the threat of teacher layoffs this coming fall."
'90s gamer nostalgia interlude: Goldeneye 007 is being redone for the Wii.
Still to come: In energy, Obama has appointed a new head drilling regulator. In economy, the Federal Reserve is limiting the late fees your credit-card company can charge you; in domestic policy, law deans are backing Elena Kagan's Supreme Court bid; and in FinReg, Al Franken's proposal to reform the ratings-agency business got killed.
John Kerry and Joe Lieberman are happy with the EPA's analysis of the American Power Act, reports Darren Samuelsohn: "Sens. John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) found many reasons to gloat after getting the 74-page study that showed the overall costs from their legislation’s major global warming provisions would cost an average household between $80 to $150 per year. 'There’ll be some people who will want to demagogue that politically, but that’s less than $1 a day,' Lieberman told reporters."
Obama has picked Michael Bromwich, an organizational fixer, to run the Minerals Management Service, reports Juliet Eilperin: ""He has an unusual, an uncanny ability to identify the problem areas within an agency and a department and identify the potential solutions for them," Danburg said in an interview Tuesday. Bromwich also served for five years as a inspector general for the Justice Department under President Bill Clinton, as the District's independent monitor on the issue of excessive force within the Metropolitan Police Department, and as the independent investigator for the Houston Police Department's crime lab. And he served as an associate counsel in the Iran-contra investigation in the late 1980s."
The latest leak estimate is 35,000 to 60,000 barrels a day: http://bit.ly/96F0ha
Congressmen Henry Waxman and Ed Markey targeted non-BP oil companies for their safety planning yesterday, report Stephen Power, John Kell, and Siobhan Hughes: "Mr. Waxman presented an excerpt of BP's spill-response plan that is virtually identical to one filed by Exxon Mobil. He said Exxon Mobil, Chevron, Conoco Phillips and Royal Dutch Shell are 'no better prepared to deal with a major oil spill than BP.'"
BP offered a "prebuttal" to Obama's speech, reports Josh Gerstein: "Fryar said BP has approved 90 percent of the commercial claims of more than $5,000 it has received, issuing initial monthly payments totaling $16 million to 337 businesses in the gulf region. So far most claims have been filed by fishing or seafood processing operations and by tourism-related businesses, he said."
Steve Pearlstein thinks Obama and BP CEO Tony Hayward should have been working together from the start: "This needs to be the Barack and Tony Show, not the Barack and Tony Showdown. Barack and Tony on the phone with each other debating options, hashing through conflicting priorities and filling in each other's to-do lists. Barack and Tony surveying the oil slick from the air.…It is important to demonstrate that the adults are in charge and that they're not wasting time, attention or energy pointing fingers or covering their political or corporate backsides."
David Leonhardt says lawmakers are running from the pro-market consensus that birthed cap-and-trade: "Accepting higher costs is especially hard when the economy is weak. So Congressional Democrats have been repackaging their energy bills to make them look less and less market-oriented. Senator John McCain, who supported a permit system for carbon as the Republican presidential nominee, no longer does. Senator Lindsey Graham, the South Carolina Republican, has reversed his position as well. What does Mr. Graham now favor? A series of command-and-control regulations."
Terrifying imagery interlude: Waves after the oil spill.
The stimulus package's Build America Bonds are facing new criticism, reports Julie Creswell: "For one, Wall Street banks are charging larger commissions for selling Build America Bonds than they do for normal municipal bonds, increasing the costs to the states and cities. For another, the new bonds may be priced too cheaply, enabling quick-footed investors to turn a fast profit as the prices climb, but raising interest costs for taxpayers. Those imbalances have caught the eye of the Internal Revenue Service, which is asking municipalities whether the bonds are being priced and sold correctly. Alarmed by the uncertainty, Florida, which has sold more than $1.6 billion of Build America Bonds, has retreated from the market."
The Fed is taking action to defend credit card holders, reports Jeff Bater: "The rules, which take effect Aug. 22, limit credit-card issuers from charging a penalty fee of more than $25 for paying late or otherwise violating the account's terms, unless the consumer has made repeated violations or the issuer can justify that a higher fee represents a 'reasonable proportion' of the costs it incurs from the violations. The new regulations also prohibit issuers from charging penalty fees that exceed the dollar amount of the violation. 'Issuers will no longer be permitted to charge a $39 fee when a consumer is late making a $20 minimum payment,' the Fed said. 'Instead, the fee cannot exceed $20.'"
House builders' confidence is falling: http://bit.ly/cPirlh
Alan Blinder thinks history will look kindly on TARP and the stimulus package: "Spending perhaps $50 billion of taxpayer money to forestall a financial cataclysm seems like a bargain. Yes, I know it's maddening to hand over even a nickel to bankers who don't deserve it. But doing so was a necessary evil to save the economy. Think of it as collateral damage in a successful war against financial armageddon."
Harold Meyerson argues that American and Chinese workers face similar challenges in the workplace: "I wonder, though, whether the declining power of American workers over the past 40 years hasn't increased U.S. union leaders' understanding of the constricted options that Chinese workers confront. In both countries, workers who agitate for unions or for better conditions are frequently fired. In China, to be sure, the consequences seldom stop there; in the United States, employers' penalties for such nominally illegal firings are negligible. No other major industrial nations are as hostile to independent unions as China and the United States."
'80s Scot-rock interlude: Big Country's "In a Big Country".
Law deans are pushing for Elena Kagan's confirmation to the Supreme Court, reports Amy Goldstein: "The endorsement was signed by 69 deans, including some, the letter says, who are personal friends of Kagan's. There are about 200 law deans in the United States, according to the Association of American Law Schools. The letter was written by the dean of Stanford Law School, Larry D. Kramer, on behalf of the others who signed it, including Kagan's successor at Harvard and the dean at the University of Chicago, where she taught in the first half of the 1990s."
Massachusetts' health care system has protected workers in the recession, but its costs threaten some businesses: http://politi.co/94skoG
There won't be many grandfathered health plans by 2013, reports Jennifer Haberkorn: "The health care law envisioned that some plans would be 'grandfathered in' under the old law - and therefore would not be required to meet some of the mandates of the new law, such as no-charge preventive care screenings.…The regulation, released by the Department of Labor, the Treasury and HHS, estimates that 13 percent to 42 percent of employers would lose their grandfathered status by next year, and 34 percent to 80 percent would by 2013. Small businesses are considered more likely than larger companies to lose their grandfathered status."
Some people in debt are facing jail time: http://bit.ly/aLgS1N
Adorable animal interlude: Kitten freaks self out with mirror.
Mega-banks are letting credit unions fight for them on swipe fee regulations, reports Ben White: "They’ve barely uttered a word of opposition - even as they mount a furious campaign to strip the language out of the bill behind the scenes. That’s because even big bank executives know they’re about as popular as a root canal these days, and the last thing they need is to look like they’re fighting a plan that could translate into savings for consumers. Their solution? Leave the lobbying on the issue to the equivalent of mom and pop operations - community banks, credit unions and even some state treasurers."
The SEC is hiring more financial experts as investigators: http://bit.ly/c9JqsP
The Office of Congressional Ethics is investigating House members for possible quid pro quos around the FinReg vote, reports Carol Leonnig: "The Office of Congressional Ethics is investigating eight lawmakers who held fundraisers within 48 hours of a major House vote on a Wall Street reform bill or received substantial donations from business people with a financial stake in the bill, according to congressional sources and letters. The probe is focused on whether the timing of accepting the campaign checks created an unacceptable appearance of a conflict, according to sources familiar with the investigation and letters sent by OCE to lobbyists requesting information."
The FinReg conference committee appears to have reached a deal on increasing deposit insurance: http://bit.ly/9lzhei
Conference committee is dropping Al Franken's rating agencies amendment, reports David Herszenhorn: "In conference negotiations to reconcile the House and Senate versions of the legislation on Tuesday, Senate Democrats said they were willing to remove Mr. Franken’s language and accept a proposal by Mr. Frank calling for the Securities and Exchange Commission to study the conflict-of-interest issue without immediately imposing the requirement of random assignments of rating agencies."
FinReg could drop changes to how the New York Fed chair is appointed: http://bit.ly/cEnQFQ
Centrist House Democrats are resisting Blanche Lincoln's derivatives proposal, reports Silla Brush: "The New Democrat Coalition, a group of 69 centrist House Democrats, is preparing a letter that will urge lawmakers to drop the provision, championed by Senate Agriculture Committee Chairwoman Blanche Lincoln (D-Ark.). Members are still collecting signatures for the letter.…The New Democrats argue the provision would increase risks in the financial system and shift derivatives trading to less-regulated financial firms. The lawmakers argue the conflict-of-interest concerns are addressed by a separate proposed ban on proprietary trading at banks that is dubbed the 'Volcker rule.'"
Closing credits: Wonkbook compiled with the help of Dylan Matthews and Mike Shepard. Photo credit: Pete Souza/White House
June 16, 2010; 6:47 AM ET
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