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Wonkbook: Lincoln's hand strengthened; energy bill stalled; deficit fears dominant

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In the wake of her primary victory, Blanche Lincoln is gaining support for her derivatives reform proposal. Meanwhile, energy legislation is stalled in the Senate following Lindsey Graham's announcement that he will oppose a carbon cap. Some attention is turning towards Richard Lugar's no-cap compromise, which is exactly the sort of half-measure Graham used to say he wouldn't support. Now he's a co-sponsor. And a new Gallup poll shows people are more worried about the deficit than about health-care costs, immigration, global warming, corporate power, unemployment...

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Blanche Lincoln's derivatives reforms are gaining ground following her primary win, report Michael Crittenden and Victoria McGrane: "Diane Raley, a spokeswoman for Thomas Hoenig, president of the Federal Reserve Bank of Kansas City, said Mr. Hoenig has been studying the provision and finds 'it is consistent with his desire to take the riskiest activities out of the commercial banking system.' Senate Majority Whip Richard Durbin (D., Ill.) said Ms. Lincoln is now in a stronger position. 'She returns as the chairman of the Agriculture Committee, running for re-election in November, which I think gives her a strong bargaining position.'"

A new Gallup poll finds the national debt tied with terrorism as voters' biggest worry. Health-care costs, unemployment, immigration, and global warming all lag. http://bit.ly/9sbXaf

Meredith Shiner reports that the Senate doesn't know what to do about energy: "Graham’s situation captures the confusion and lack of vision on energy legislation. He broke off with Kerry and Lieberman last month. He said Tuesday that Lugar’s bill probably couldn’t get many votes. And suddenly Wednesday, Graham had become a chief co-sponsor of Lugar’s bill."

Speaking of Lugar's bill, John Broder writes up an introduction: http://bit.ly/dufQG1

2012 watch begins: Andrew Ferguson's extremely-flattering profile of Mitch Daniels shows why the Indiana governor is increasingly the choice of conservative policy wonks.

Barbecue interlude: People like flavored ices, right?

Table of Contents: Bill Gates wants more energy research (and other energy news); Ben Bernanke is warning Congress about the deficit (and other economic news); the House is set to pass a big capital gains tax cut (and other domestic policy news); and credit unions are resisting the swipe fee regulations in FinReg (and other FinReg news).

Energy

Bill Gates wants more government funding of energy research: Read his WSJ interview. Jeffrey Immelt of GE and venture capitalist John Doerr are also on board.

BP has been trying to block coverage of the oil spill, reports Jeremy Peters: "In the first few weeks after the oil rig explosion, BP kept a tight lid on images of the oil leaking into the gulf. Even when it released the first video of the spewing oil on May 12, it provided only a 30-second clip. The most-detailed images did not become public until two weeks ago when BP gave members of Congress access to internal video feeds from its underwater rovers. Without BP’s permission, some members of Congress displayed the video for news networks like CNN, which carried them live."

Richard Lugar is out with a new greenhouse gas bill. Brad Plumer says it's a mixed bag.

Inspector numbers in the Gulf of Mexico haven't kept pace with offshore drilling growth, report Juliet Eilperin and Steven Mufson: "Although the number of exploration rigs soared and the number of deep-water oil-producing projects grew more than tenfold from 1988 to 2008, the number of federal inspectors working for the Minerals Management Service has increased only 13 percent since 1985."

Public support for offshore drilling is plummeting. 72 percent want fewer or the current number of offshore wells.

Republicans are resisting a tax on offshore oil drilling, reports Scott Wong: "The proposal, part of a larger tax extenders bill being debated by the Senate, increased the tax on offshore oil to 41 cents per barrel from 8 cents. Republicans have complained that the money generated by the tax hike—$15 billion over 10 years—actually would be used to ease a House-backed tax on investment fund managers and to offset increased spending on things like Medicaid."

Josh Green thinks the oil spill is killing the Tea Parties: http://bit.ly/cii33M

Adorable synergy interlude: Cute dog messes with cute baby.

Economy

Ben Bernanke fears the US could end up in Europe's current situation, reports Jia Lynn Yang: "The budget deficit was necessary to help get the nation out of recession, Bernanke said, but will have to be addressed in the long term, particularly in light of the European debt crisis."

The new Fed "beige book" reports modest growth. Read the whole thing,or the Post recap.

Russ Feingold has introduced an administration-supported line-item veto alternative, reports Jackie Calmes: "It would require a president to send Congress proposed rescissions within 45 calendar days after signing an appropriations measure – sooner than the 45 Congressional business days that Mr. Obama proposed as a deadline. Congress would have to consider the president’s rescissions proposal immediately and the House and Senate could not amend it."

Build America Bonds for state and local governments are under fire as the administration is trying to extend them. http://bit.ly/9RABvT

Economists predict a slow recovery, reports Phil Izzo: "On average, the 53 respondents to the Journal's monthly survey still expect the U.S. economy to grow about 3% in the second half of the year and to continue at that pace into 2011. That means adding jobs so gradually that unemployment, now at 9.7%, will be at a still-elevated 8.6% by the end of December 2011."

Board game interlude: The shortest possible game of Monopoly.

Domestic Policy

The House is preparing to pass a capital gains tax cut for small businesses, reports Martin Vaughan: "Under current law, investors may exclude 75% of their gains from capital-gains taxes for small business stock purchased before Jan. 1, 2011, and held for five years. The House bill would increase that exclusion to 100% and extend it for an additional year, through the end of 2011. It also would ease IRS penalties on small businesses for failing to disclose their use of certain employee-benefit plans the IRS has branded tax shelters."

Ann Gerhart and Philip Rucker profile Elena Kagan's ability to flatter and impress important people:. http://bit.ly/cpuVHE

Fees on foreign investment set to rise, reports Miriam Jordan: "The initial cost to process a petition for a foreigner seeking to earn the right to live in the U.S. by investing at least $500,000 and creating jobs, under a program known as EB-5, would rise to $1,500 from $1,435. However, another fee associated with the program, which must be paid about two years later, would jump to $3,750 from $2,850. Operators of so-called regional centers—projects designated to receive investment by the foreigner entrepeneurs—will have to pay $6,230 to qualify for those funds, according to the new fee structure."

The GOP is resisting FCC regulation of the Internet, reports Tony Romm: "Republican appropriators slammed the Federal Communications Commission on Wednesday for leaving Congress on the sidelines as it seeks to enforce net neutrality and more heavily regulate Internet providers.…An incensed Rep. John Culberson (R-Texas) even warned federal dollars could be on the line if the agency uses its own rule-making process to rein in companies like Verizon, AT&T and Comcast."

Celebrity phobia interlude: Salma Hayek is not fond of snakes.

FinReg

Credit unions want swipe fee rules in FinReg changed, report Ylan Mui and Brady Dennis. And they have the lobbying power to make it happen: "Community bankers, auto dealers and other Main Street businesses have won exemptions from proposed new regulations by repeating a mantra not available to big Wall Street firms: We didn't cause the crisis.…'The major influence has been legitimate grass-roots networks -- credit unions, auto dealers,' said Rep. Barney Frank (D-Mass.). 'They are the kinds of operations that have members in every district. People who get sponsored by big institutions have had very little impact.'"

Former financial workers are flocking to work on Capitol Hill, and not as lobbyists, reports Erika Lovley: "Capitol Hill has become a magnet for some former financial industry executives, who have traded high-flying jobs for the grind of congressional hearings and committee markups. Some are taking Hill salaries that would have been a mere Christmas bonus on Wall Street. One former Lehman Brothers analyst still calls his buddies in the trading pit in New York. Another who did work for the defunct investment giant landed a spot in a congressional office — as an unpaid intern."

Closing credits: Wonkbook compiled with the help of Dylan Matthews.

By Ezra Klein  |  June 10, 2010; 6:15 AM ET
Categories:  Wonkbook  
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Next: Labor vs. Lincoln

Comments


Health care (transformation) is one of the best issues this current administration has done thus far. With this change individuals will have the opportunity to seek professional and quality health care services. Who would want to return to the days of the horse and buggy, b/w tv sets, manual typewriters, pac man, you get the point? That's about how old the health care system was in the USA. Each day the news is filled with social tragedies in which lives are taken at the hands of known acquaintences and/or family members. Our society is stricken with the institutions of white collar crime permeating throughout this great nation and greed which tends to strike at the very fabric of our country. If you are looking for affordable health insurance check out http://bit.ly/cmg7mK I hope everyone will soon recognize and use the resources made by this transformation to seek professional medical attention as the need arises rather than turning to illegal and criminal activities to resolve their issues.

Posted by: carygrant09 | June 10, 2010 6:59 AM | Report abuse

>>A new Gallup poll finds the national debt tied with terrorism as voters' biggest worry.>>

79% view debt and terrorism as very or extremely serious (with 21/20% saying not serious). 83% view unemployment as very or extremely serious (with 17% saying not serious).

Seems to me unemployment is the biggest worry.

Posted by: fuse | June 10, 2010 7:17 AM | Report abuse

the symbolic national bird of this generation, is not the eagle.
it is the indelible image of that oiled, sickly pelican that has been caught in an asphyxiating sludge and cant see clearly, cant shake off the engulfing sludge. cant fly...or find a direction.

i dont recall being polled, but my greatest concern is the incompetency, complete unpreparedness to deal with the serious nature of the problems facing us, and simplistic thinking in much of the republican leadership today. and the choking stranglehold of corporate money, influence and power, and the special interest groups that dominate all of our policy-making, and buy out the people who are supposed to be representing us.
when we have people like lisa murkowski, john boehner, sarah palin, john mccain, eric cantor, rand paul, rush limbaugh, being the voices of influence over vast swaths of republicans.....deniers of science, simplistic, angry individuals without the creativity. depth of understanding and intelligence to deal with the problems that we have today....we are in real danger. they are pulling us back into dark ages.
in this country now, when the conversation is whether a president emotes enough visible anger, and that becomes the measure of performance, instead of the inability to raise the liability cap on british petroleum, when you have someone like sarah palin influencing thinking about drilling and energy problems, you see that we are moving in a backwards tide.
we have been strangled by corporations and bought and incompetent politicians. we are all starting to look like the oiled birds in the ocean, falling into a sludge....unable to move or fly.
how can there be change, or vision in this culture?
despite our best hopes, the forces of greed and stupidity have gained the upper hand now.

Posted by: jkaren | June 10, 2010 8:48 AM | Report abuse

"Josh Green thinks the oil spill is killing the Tea Parties"

Josh green is also certain he's about to win the lottery, and be asked out by a supermodel.

It's amazing how much modern opinion/reportage is the product of cleverly rationalized wishful thinking.

The Tea Parties aren't going to collapse until they've had enough victories (either in 2010 or 2012) that they have to govern, or politicians sympathetic to their side (in theory) are in power.

The idea that "well, xxx happened so now everybody knows that xxx party is wrong" doesn't work out. Just the recent primaries, and the fairly significant number of tea party candidates that won in Republican primaries, suggest that Josh Green is incorrect. Similar things were said after the Tea Party candidate lost in New York. Yet they still seem to be hard at work . . .

Posted by: Kevin_Willis | June 10, 2010 8:55 AM | Report abuse

http://media.masslive.com/breakingnews/photo/aptopix-gulf-oil-spill-5ba20036d07f99f6_large.jpg

"from sea to shining sea."
2010
these pictures require a long, hard look.
just one oiled eye. what is left of an unblinking, myopic gaze of conscience, as this once endangered bird sinks into a disaster that we created, cannot seem to fix, and some are even denying.
a metaphor of where we find ourselves.
a heartbreak.
and no-one seems to be able to do a damned thing about anything.

Posted by: jkaren | June 10, 2010 9:02 AM | Report abuse

@jkaren: "simplistic thinking in much of the republican leadership today"

The Democrats control the house, the senate and the Whitehouse. They've have the senate and the house since 2006. That's four years. The problem is not primarily the Republican leadership.

"when we have people like lisa murkowski, john boehner, sarah palin, john mccain, eric cantor, rand paul, rush limbaugh, being the voices of influence over vast swaths of republican"

Thank goodness liberals are smarter and better people than Republicans, and so aren't influenced by the voices of Olberman and Michael Moore and Markos Moulitsas, etc.

"without the creativity. depth of understanding and intelligence to deal with the problems that we have today"

Well, calling people stupid and unimaginative is always a great way to win them over to your way of thinking.

Posted by: Kevin_Willis | June 10, 2010 9:05 AM | Report abuse

at kevin willis
"Well, calling people stupid and unimaginative is always a great way to win them over to your way of thinking."


there is no winning "them" over.
what better words would you find for sarah palin, rush limbaugh, rand paul?

what frames their thinking except for a lack of intelligent thinking, of stupidity?
what do you think, kevin, when you listen to sarah palin, or rush limbaugh, or rand paul, and tragically think of the power they wield?
president obama has been the quintessence of goodness and patience, in dealing with these people. it wouldnt matter how many times he goes on fox, and is treated abusively by the interviewer, it will never silence the atrocious things that rush limbaugh or sarah palin will say about him....codewords and cruel comments.
there is no winning over these people. one can work around them, but look what they are doing to our country.
and yes, in this generation, liberals are smarter, and more open to ideas for the future, than the present republican leadership.
and it only takes one republican, one lisa murkowski to change everything, no matter what the balance of power.
there is no defense for her position. and look what she has the power to do.
in its present state, there is little to like about the agenda of the republican party in this generation. their representation in the bush and cheney years and now, is a long generation of unenlightened and dangerous thinking.


Posted by: jkaren | June 10, 2010 9:19 AM | Report abuse

Obama, and most Dems, have lost me as a supporter.

Obama clearly stands for the status quo.

He and Clinton worked hard to re-elect Lincoln (and Specter), a ConservaDem who helped delay HCR and thus gravely hurt his ability to lead. I consider this assistance to Lincoln as further proof that Obama is leading as a center-right President.

The fact Clinton helped Obama, and soundly abused unions as he tried to help Lincoln proves he too (and probably Hillary) is a center-right President.

Obama and the Dems could have passed the Employee Free Choice Act in their first year. Same goes for HCR, and a new energy and climate bill as well. Bush had no problems passing tax cuts in his first year and Clinton had no problem passing Nafta in his first year. In essence, the only major legislation passed in a "first year" whether you are Repub or Dem is right-wing legislation. Bush even had no problem convincing Congress to invade the wrong country in his first two years (and get more tax cuts).

The fact Obama did not fight for HCR, and only supported it after most of its meat was delayed for several years so it can be cut by his deficit commission later, and only fought for it after Brown's victory indicated Obama's ncompetence had spared a populist uprising, convinces me HCR was never meant to pass, and that ConservaDems were going to blame failure of HCR on an obstinate GOP.

Add to the record that Dems failed to limit credit card interest rates (passing only ILLUSORY credit card reforms), and passed only ILLUSORY ceo pay/bonus limitations, and that Obama's team actually worked in secret to protect CEO pay/bonuses, and that Obama has utterly failed to reel-in American violence in Afghanistan despite stark evidence that the Taliban was created and is still supported by Pakistan's intel services (and has no intention to destroy the Taliban or to stabilize Afghanistan), well, and that Obama is adhering to deficit-chickens during a crippling recession, it is clear Obama depend's on and adhere's to neocon advice more than any other.

There are many other examples to cite of Obama's actual adherence to center or right-of-center (even rightwing) ideology.

Sotomayer and Kagan are firm centrists, so again, why not progressives instead?

I also place full blame for this oil spill on Obama. He entered office promising to take a hard look at the oil business and its practices. He forthwith ignored all that after taking office. Two years was sufficient time to send political operatives into every agency and dictate exec orders for new policies. Bush had no problem doing the same in his first year.

Obama is incompetent and is lying about where he stands ideologically. So are at least a third of the other elected Dems.

Obama should resign immediately. I don't think the country is in any better condition now than it would have been had Sarah Palin took office instead.

Posted by: Lomillialor | June 10, 2010 9:20 AM | Report abuse

" I don't think the country is in any better condition now than it would have been had Sarah Palin took office instead."


that takes the cake.

Posted by: jkaren | June 10, 2010 9:35 AM | Report abuse

obama has not run roughshod over the republicans. he has tried to reach some consensus, and with health care reform, it was clearly impossible.
did you hear john boehner at the passing of the health care reform bill? sarah palin talking about death panels? republicans denying the existence of global warming? rand paul's thoughts on civil rights legislation in this country? governors in the south, still calling for more drilling? lisa murkowski speaking against raising the liability caps?
and you are calling for obama's immediate resignation???
bobby jindal, the biggest hypocrite of all, lamenting before the running cameras about the damage that the oil spill is doing to his cherished coastline, and in the next breath, the very next breath, saying that it will hurt the economy to shut down the other wells, even though we have no clue how to avoid another catastrophe that could worse on one of the deeper wells not far away? this is the very heart and soul of talking the talk and not walking the walk.
because bobby jindal said what everyone wanted to hear in two breaths, is that going to be the hope of the republican party?
there has been a lot that i have not been in agreement with in the obama administration, but given the breadth of corruption and stagnation, the deathly calcification in our political system, i think there is only so much that one can do.
and you are saying that empowering these people, under a sarah palin presidency, would have been the same as an obama presidency?
as is commonly said, "there is something in your koolaid."

Posted by: jkaren | June 10, 2010 9:51 AM | Report abuse

"They've [the Democrats] have the senate and the house since 2006. That's four years."


Kevin_Willis,

This is wrong.

The Democrats took control of the House of Representatives in 2007. The Republicans continued to have the majority in the Senate until 2009.

So the Democrats have had the majority in both house of Congress since 2009. That's one year, not four.

Posted by: Patrick_M | June 10, 2010 10:17 AM | Report abuse

"what frames their thinking except for a lack of intelligent thinking, of stupidity?"

That describes Democrats and Obama perfectly. Thanks!

Posted by: Azarkhan | June 10, 2010 11:06 AM | Report abuse

Not sure you can really say this: "And a new Gallup poll shows people are more worried about the deficit than about health-care costs, immigration, global warming, corporate power, unemployment..."

If you total 'extremely serious' and 'very serious', Unemployment leads both terrorism and deficit. (What is the difference between extremely and very, anyway -- semantics?) They just grouped the data in a way to make deficit top concern.

If you sorted (min->max) on the last column, you'd have a different headline. Although, one the Pete Peterson crowd wouldn't like.

I think that's pretty shoddy...

Posted by: rat-raceparent | June 10, 2010 11:14 AM | Report abuse

"...The Republicans continued to have the majority in the Senate until 2009."
Patrick_M

That is a lie.

After the 2006 election the Senate was tied 49-49 between Dumbs and Republicans. However, the Dumbocrats took control of the Senate because Sens. Sanders and Lieberman caucused with them.

I suppose the next lie will be that Sanders (Mr. Socialist) and Lieberman (90-100 rating from ADA) are raging conservatives, so they didn't help with the Dumbocratic agenda.

Please leftists, when you lie (which for you is as natural as breathing), try making up lies that are difficult to refute. This one was too easy!

Posted by: Azarkhan | June 10, 2010 11:27 AM | Report abuse

Azarkhan,

Yes, the Democratic caucus had a majority of one in the Senate in 1997-1998, even there were only 49 Democrats elected to the Senate. But in case you didn't notice, Joe Liberman supported the Republican ticket in 2008, and if McCain had his way, Joe would have been running on that ticket.

In order to actually move legislation through the Senate, the Democrats need enough seats to get around independent Joe and the ConservaDems, as anyone who has watched the painful battles in the Senate over the past year is well aware. Now with 59 seats, they still are up against constant procedural hurdles with the party of no, but they at least were able to pass health care in reconciliation with a simple majority.

During 2007-2008, the two parties were in virtual gridlock, which meant that the Republicans effectively controlled the agenda by obstruction.

Posted by: Patrick_M | June 10, 2010 11:47 AM | Report abuse

"Obama is leading as a center-right President."

This is very bad news for Obama. Where is his constituency? If liberals think he is center-right and conservatives think he is a socialist, that spells a lot of trouble ahead...

I'm not sure how Obama is center right (I would agree he is center left).

Okay, he didn't put a lot of support behind the 'unions run wild' ECFA, but he also bailed out the UAW. While his support may have seemed lukewarm for HCR, odds are President McCain would not have signed PPACA. Then you have the stimulus which expanding unemployment benefits, provided healthcare subsidies, tried to get the ball rolling on 'green jobs' and public transportation. Marginal tax rates on both high earners and capital are going up. So Obama didn't nationalize the banks but he isn't exactly chummy with them either.

"" I don't think the country is in any better condition now than it would have been had Sarah Palin took office instead."


that takes the cake."

I'm going to go ahead and agree with JKaren on this one. For all we know we'd have a third war on our hands under the Palin administration...

Posted by: justin84 | June 10, 2010 1:44 PM | Report abuse

"there is no winning 'them' over."

Yikes. Well, okee-dokee. Dubya couldn't have said it better.

"is a long generation of unenlightened and dangerous thinking."

Well, okay, then. Not a lot room for discussion there.

"I don't think the country is in any better condition now than it would have been had Sarah Palin took office instead."

Well, I have to agree with that (we'd be better off: more scenic bridges, and a bear skin rug on every hearth). That being said, we would have actually had McCain, and his presidency would have been a near-echo of Obama's, in my opinion: corporatist centrism. He might not have said he'd close Gitmo, but Gitmo would be just as open . . . just like it is under Obama! He might not have agreed to timelines for Afghanistan and Iraq, but the military leadership would be calling the shots, just like they are now. And so on. I think McCain would have show tepid support for amnesty and a climate bill, but not delivered much leadership on those issues . . . just like Obama. And with a Democratic house and senate, I think he would have gone along with a form of healthcare very much like what we got.

So, in a sense, McCain actually won in 2008.

Also, I really liked the post-election Southpark with McCain and Obama actually being in cahoots, and pulling a con so they could use the Whitehouse to steal the Hope diamond (or some big diamond) from the Smithsonian. That was awesome.

Posted by: Kevin_Willis | June 10, 2010 2:10 PM | Report abuse

Now that Blache Lincoln won the primary, it is up to us to help support strong derivatives provisions in the Wall Street reform bill. This significant piece of the bill is being threatened; don’t let Wall Street pressure congress to take it out! Help make a difference and check out this Public Citizen website to have your voice heard and tell your members of congress they need to keep up the fight http://bit.ly/bfZMQJ.

Posted by: krutledge1 | June 10, 2010 2:19 PM | Report abuse

Now that Blache Lincoln won the primary, it is up to us to help support strong derivatives provisions in the Wall Street reform bill. This significant piece of the bill is being threatened; don’t let Wall Street pressure congress to take it out! Help make a difference and check out this Public Citizen website to have your voice heard and tell your members of congress they need to keep up the fight http://bit.ly/bfZMQJ.

Posted by: krutledge1 | June 10, 2010 2:21 PM | Report abuse

Now that Blache Lincoln won the primary, it is up to us to help support strong derivatives provisions in the Wall Street reform bill. This significant piece of the bill is being threatened; don’t let Wall Street pressure congress to take it out! Help make a difference and check out this Public Citizen website to have your voice heard and tell your members of congress they need to keep up the fight http://bit.ly/bfZMQJ.

Posted by: krutledge1 | June 10, 2010 2:23 PM | Report abuse

Kevin_Willis:

"And with a Democratic house and senate, I think he would have gone along with a form of healthcare very much like what we got."

Have you forgotten the McCain "plan" (eliminating the tax exemption on employer-provided health insurance and replacing it with a $2,500 individual, and $5,000 family, tax credit for those who have health insurance.)?

The McCain "plan" for health care was nothing like the plans of Obama, Clinton & Edwards. There would have been absolutely no way to come to any compromise between the two approaches, let alone end up with your vision that under McCain there would have been any Republican support for "a form of healthcare very much like what we got."

We would have had no health reform at all had McCain won.

Posted by: Patrick_M | June 10, 2010 4:43 PM | Report abuse

"That being said, we would have actually had McCain, and his presidency would have been a near-echo of Obama's,"


unless something happened to him,and we could have had sarah palin in the white house....perish the thought.
and to have actually put her on the ticket, it proves my point about the dangerous and unenlightened thinking of the republicans in power.

Posted by: jkaren | June 10, 2010 5:21 PM | Report abuse

"That being said, we would have actually had McCain, and his presidency would have been a near-echo of Obama's,"

a near-echo of obama's....


yes, certainly, that.
with sarah palin, just one step away from the presidency....and the tea baggers coming over on sunday afternoons for moosemeat stew and taters....and salons with the travelling sisterhood of meg, carly and sarah.... rand paul, the "first dude" presiding over the opening of more deep sea rigs.... glenn beck and rush limbaugh as masters of ceremonies..... civil war enactments by the rose garden...one's imagination could go wild, with a mccain and palin administration.

Posted by: jkaren | June 10, 2010 5:46 PM | Report abuse

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