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Wonkbook: Climate bill dead; Obama signs unemployment bill; Geithner vs tax cuts


Harry Reid has officially given up on plans to pass a climate bill through the Senate before the August recess. Which means it's hard to imagine a climate bill passing at all during the remainder of this congressional session. It's also hard to imagine one passing next session.

Meanwhile, Barack Obama signed into law an unemployment insurance extension over a month after benefits initially expired; Tim Geithner has come out against extending Bush tax cuts that apply to high earners; and the Congressional Budget Office scored a new version of the public option and found it would save the government more than $50 billion and consumers about five to seven percent in premiums.

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The Senate Democratic leadership has given up hope on passing a climate bill before the August recess, reports Perry Bacon: "Instead, Democrats will push for a more limited measure that would seek to increase liability costs that oil companies would pay following spills such as the one in the Gulf of Mexico. It also would create additional incentives for the development of natural gas vehicles and would provide rebates for products that reduce home energy use. Senate Democrats said they expected to find GOP support for the bill and pass it in the next two weeks."

Parties involved are already debating who killed the climate bill, reports Darren Samuelsohn: "One exasperated administration official on Thursday lambasted the environmentalists - led by the Environmental Defense Fund - for failing to effectively lobby GOP senators. 'They didn’t deliver a single Republican,' the official told POLITICO. 'They spent like $100 million and they weren’t able to get a single Republican convert on the bill.'

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Obama has signed a six-month extension of unemployment benefits into law, reports Lori Montgomery: "The jobless bill revives a program that provides up to 99 weeks of income support to those who have lost their jobs in the recession. Advocates for the unemployed said checks in some states are likely to go out quickly; in others, people can expect a delay of several weeks."

Tim Geithner does not want to see Bush tax cuts on high earners extended, reports Lori Montgomery: "Geithner's comments come as a small but vocal group of Democratic lawmakers has begun to argue that the feeble economic recovery suggests that no taxes should be raised right now -- not even taxes on the approximately 3 million high earners who have been frequent Democratic targets. In the past few years, Democrats have offered a flurry of plans to raise taxes on that group, and they followed through in the recent health-care overhaul."

CBO looks at another public plan proposal: "CBO estimates that the public plan’s premiums would be 5 percent to 7 percent lower, on average, than the premiums of private plans offered in the exchanges...roughly one-third of the people obtaining coverage through the insurance exchanges would enroll in the public plan...CBO and the staff of the Joint Committee on Taxation (JCT) estimate that the proposal would reduce federal budget deficits through 2019 by about $53 billion.

Live indie interlude: Best Coast, Kid Cudi, and Rostam Batmanglij play "All Summer".

Still to come: How FinReg passed; Salazar promises to end the Interior Department's revolving door with industry; health insurance plans are increasing premiums and hoarding cash; and a montage of dogs eating ice cream.


Renae Merle profiles the Obama administration lieutenants who made FinReg possible: "Geithner and Lawrence H. Summers, Obama's top economic counselor, brought Wolin, Barr and Farrell together. They are an Ivy League trio known for their wonky discussions of the details of complicated legislation. Wolin and Barr both worked at the Treasury Department during the Clinton administration, while Farrell had been head of the McKinsey Global Institute, the economics research department of the consulting firm McKinsey & Co...The trio sometimes were reluctant to make necessary compromises and had to be prodded by legislative allies to do so, congressional aides and industry lobbyists said."

Workers whose unemployment insurance was cut off are now eligible for retroactive lump sum payments:

The Fed is now stuck with over $1 trillion in unwanted securities, reports Binyamin Appelbaum: "While officials and economists generally regard the program as successful in supporting the housing market, it has left the Fed holding a vast pile of mortgage securities -- basically i.o.u.’s from homeowners -- that it does not want and cannot sell. Holding the securities could cost the Fed a lot of money and hamper its ability to fight inflation, while selling the securities could drain needed money from the still-weak economy."

The end of the housing tax credit contributed to another drop in home sales:

Bailed-out firms received $1.6 billion in excessive compensation, reports Jia Lynn Yang: "Kenneth Feinberg, who was appointed as the Obama administration's special master for compensation, will single out 17 companies for egregious payment practices, according to sources familiar with the findings who spoke on condition of anonymity because the report had not yet been released. Out of these companies, 11 have paid back the assistance received from taxpayers."

Ben Bernanke warned against lowering interest rates on excess bank reserves:

Paul Krugman thinks GOP defenses of Bush-era economic policy fall flat: "The actual record of the Bush years was (i) two and half years of declining employment, followed by (ii) four and a half years of modest job growth, at a pace significantly below the eight-year average under Bill Clinton, followed by (iii) a year of economic catastrophe. In 2007, at the height of the 'Bush boom,' such as it was, median household income, adjusted for inflation, was still lower than it had been in 2000."

Capitalism only works under a culture of trust, writes Tim Harford:

Sketch art interlude: Portraits done in one minute.

Domestic Policy

Health insurers are raising premiums despite high surpluses, reports N.C. Aizenman: "The report released Thursday by Consumers Union, the nonprofit publisher of Consumer Reports, found that seven of 10 Blue Cross Blue Shield affiliates examined had amassed surpluses more than three times the level regulators deemed necessary for them to remain solvent. For instance at the close of 2009, Blue Cross Blue Shield of Arizona had a surplus of $717 billion, more than seven times the regulatory minimum. The same year the company raised premiums for its individual market customers between 8.8 percent and 18.4 percent."

Chuck Schumer has released a revised DISCLOSE Act in the Senate:

The federal judge in the Department of Justice's lawsuit against Arizona is giving mixed signals, reports Josh Gerstein: "She questioned Arizona’s lawyer about whether those parts of the law could pass Constitutional muster, and wondered whether allowing it to be implemented would 'result in the arrest of tens of thousands of people' and their indefinite detention while awaiting the results of federal immigration checks. But Bolton, who was appointed by President Bill Clinton, was also skeptical of one of the federal government’s key claims: that the overall thrust of the state law would usurp federal authority to set nationwide immigration policies."

A new metric finds US households suffering from record economic insecurity:

Immigration reform is a matter of life and death, writes Eduardo Schumacher-Matos: "Guess how many migrants, mostly Mexicans searching for work, died crossing illegally into America? The Border Patrol collected 422 in the last fiscal year, part of a rising trend. And most die in the desert. Here is how Luis Alberto Urrea, in his book, 'The Devil's Highway,' described what happens: 'Dehydration had reduced all your inner streams to sluggish mudholes...Your sweat runs out...Your temperature redlines -- you hit 105, 106, 108 degrees...Your muscles, lacking water, feed on themselves. They break down and start to rot...The system closes down in a series. Your kidney, your bladder, your heart.'"

Steve Pearlstein argues Virginia's anti-federal attitude is hurting schools: "Evaluators found that a majority of Virginia's school districts were hostile to charter schools and deficient in the way they evaluated teachers and principals and dealt with chronically underperforming schools. Yet even before the second round, Gov. Bob McDonnell (R) announced that Virginia would drop out of the competition, citing his opposition to national proficiency standards that would be less rigorous than what the state was already using. That was a curious claim, given that, at the time, the final standards had not yet been released."

"Negative studies" provide a path to health care savings, writes Harlan Krumholz: "Rather than a letdown, the failure to find an advantage in an expensive strategy opens the door to doing less and spending less without worsening patient care -- and in some cases improving it. It's simply the case that many popular medical strategies have little or no rigorous scientific evidence of their effectiveness regarding patient outcomes."

Adorable animals being adorable interlude: Dogs eating ice cream.


Secretary Ken Salazar promised Congress he would crack down on the Interior Department's revolving door with business, reports Kimberly Kindy: "His statement came after Rep. Jackie Speier (D-Calif.) asked about a Washington Post article that reported that dozens of former Interior officials had crossed over into the oil industry and that three out of four industry lobbyists had once worked for the federal government. The rate is more than double the norm in Washington, where industries recruit about 30 percent of their lobbyists from the government, according to data from the nonpartisan Center for Responsive Politics."

Ships working on the oil spill in the Gulf are leaving as a tropical storm arrives:

The oil spill investigation hearings Thursday focused on human error, reports David Hilzenrath: "The morning's main witness was John Guide, a BP well team leader who oversaw drilling on the Macondo well from BP offices onshore. Guide was asked about an April 18 report -- two days before the disaster -- from contractor Halliburton concluding that the well had a potentially severe gas flow problem. 'I didn't even know that that particular piece was in there,' Guide said, adding that he never looked at that section of such reports."

The oil spill is reducing Gulf tourism earnings by billions:

Brad Plumer argues natural gas may work better as an electricity source than a transportation fuel: "A better use for America's vast shale-gas reserves may be to displace coal in the electricity sector. A recent MIT report on "The Future of Natural Gas" found that electric utilities could cut their carbon emissions 22 percent simply by switching from coal to natural gas--and that's with no additional capital investments. And that would be on top of any additional wind turbines that got built. And what about transportation? There's a good argument that electric vehicles are a better investment in the long term."

David Roberts argues that action in Congress on climate change is still possible without a climate bill:

Closing credits: Wonkbook compiled with the help of Dylan Matthews and Mike Shepard. Photo credits: Pete Souza/White House.

By Ezra Klein  |  July 23, 2010; 6:47 AM ET
Categories:  Wonkbook  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   StumbleUpon   Technorati   Google Buzz   Previous: Reconciliation
Next: The gridlock-and-debt index


Man that anonymously sourced comment from "an administration official" blaming environmentalists for not delivering Republicans is uber shady. I find it very, very unlikely that anyone at the White House is seriously blaming EDF for the now-routine Republican "filibuster everything" strategy. If the Chamber of Commerce, AARP, and AMA couldn't deliver Republican votes on healthcare, why would you expect a liberal environmentalist group to net Republicans on climate change? Especially when you've got a fair share of reluctant Democrats to corral before even getting to that point?

On the other hand "White House fights environmentalists" is a great way to sow discord on the Democratic side right before an election. There's something really Breitbarty about that quote...

Posted by: NS12345 | July 23, 2010 7:53 AM | Report abuse

Ezra, I decided to stop by and say "thank you" for starting Journolist. You've inadvertently done conservatives like me a HUGE favor by creating an Internet forum for liberals to reveal their biases and, indeed, revel in them. Because nothing on the Internet ever really dies (were you so naive not to realize that?), the outing of liberals fantasizing about watching Rush Limbaugh die (Susan Spitz) or fuming that anybody would DARE ask candidate Obama a question about Jeremiah Wright, etc., etc. has been a huge public service (thank you, Tucker!). Nobody can ever read the MSM again and not think about those e-mails.

Thanks again, buddy!

Posted by: WashingtonDame | July 23, 2010 8:35 AM | Report abuse

Just one question. Why no black people allowed on Journolist?

Posted by: ValURite | July 23, 2010 9:13 AM | Report abuse

WashingtonDame, liberal people have liberal beliefs?! I do declare, you have shocked my delicate sensibilities!

ValURite, do you have a complete list of membership? If you do, and the membership included no black people, do you have any evidence that this was a policy of the list? Or are you just making stuff up?

Posted by: MosBen | July 23, 2010 9:54 AM | Report abuse

@WashingtonDame: There is nothing new, that hasn't been discussed in public elsewhere, on Journolist. There is nothing revelatory. If you think that the Journolist revelations are going to wake anybody up, change anybody's mind, or change a single vote, I think you're mistaken.

Over the past 20 years, journalists have already revealed themselves to be the same kind of weak, biased, partisan, self-serving folks that most everybody else is. If you cannot tell just by reading and watching the news that it is biased in some form, influenced by factors beyond objective reportage, and presented in an overly-dramatic, hyperbolic manner in order to appeal to emotions while they grind personal or political axes . . . then the Journolist revelations won't even make it on the radar.

Much more exciting than Journolist is the new Tron Trailer. A young Jeff Bridges! Recognizers! Bruce Boxleitner! Light cycles! I can't wait for that movie.

Posted by: Kevin_Willis | July 23, 2010 9:57 AM | Report abuse

Ezra, two questions. Both equally important.

1: Is it true the first Tron movie came out a year before you were born? That was a long time ago.

2: Whatever happened to the question and answer chats, plus transcript, that you used to do? It just disappeared mysteriously. And well before the Journolist thing, so I know it wasn't that.

3: Okay, one more question. And you can be honest. Are you avoiding us? Did we come on too strong? Because we don't have ask so many questions. We can be laid back about it and casual. Seriously.

Posted by: Kevin_Willis | July 23, 2010 10:00 AM | Report abuse

@MosBen: ValURite is being meta-ironic. It's a call back to the "pick anyone, call them a racist" thing from foot-in-mouth specialist, Spencer Ackerman.

Posted by: Kevin_Willis | July 23, 2010 10:02 AM | Report abuse

Can anyone tell me why this juicebox journolister is still writing for the Post?

Posted by: luca_20009 | July 23, 2010 10:13 AM | Report abuse

oh please give this Journolist crap a rest.

In regards to the "public plan" again being pushed by liberals its amazing how the savings to the deficit went originally from $120 billion now down to 53. No thought, just casually rip out almost $70 billion from the savings and that's WITH what is considered to be more enrollment.

So providers are going to willingly accept 15 million additional people on Medicaid's poor reimbursement levels and then tack on another 13 million people to this public plan. And we're not going to see ANY reduction in providers that accept Medicare/Medicaid?

Oh wait, we just don't TALK about that around here I get it.

Oh and this is where they get that $53 billion from.

"That estimate includes a $37 billion reduction in exchange subsidies and a $27 billion increase in tax revenues that would result because a greater share of employees’ compensation would take the form of taxable wages and salaries (rather than nontaxable health benefits). "

Posted by: visionbrkr | July 23, 2010 10:25 AM | Report abuse

If I am paying unemployment insurance every month (and the rates seem pretty low) why didn't they just raise the unemployment insurance rates to cover the additional benefits? Then again...if the extra benefits are only temporary, it's a bit crazy to pay for something I'll never get.

I guess that's just how government run insurance programs work though. They don't save up or collect enough money to pay, they just figure they'll borrow or print the money when the time the people that get access to the benefits don't have to fully pay for them. Medicare and Social Security seem to be running the same route...

Posted by: staticvars | July 23, 2010 10:35 AM | Report abuse

""One exasperated administration official on Thursday lambasted the environmentalists - led by the Environmental Defense Fund - for failing to effectively lobby GOP senators. 'They didn’t deliver a single Republican,' the official told POLITICO. 'They spent like $100 million and they weren’t able to get a single Republican convert on the bill.'"

Ezra, why didn't you quote Samuelsohn and the "official" further? Good stuff, including:
"The exasperated administration official also scolded the Boston Red Sox for not chipping in to cover the funeral expenses of George Steinbrenner. He then had to cut the 'leak' short because he had to go finish laying down new roof tiles on his McMansion. When I told the official I thought he had hired Jackie's Quality Roofing to do that for him, he replied, 'Well he's supervising from a chair down on the lawn. Naturally it's *my* responsibility, not Jackie's, to do the roof tiles. How else would my roof get tiled?"

P.S. Fascinating how Journolist touched a nerve with the paranoid right.

Posted by: Former_Prospector | July 23, 2010 10:58 AM | Report abuse

and nothing on Charlie Rangel? hmmm.

Posted by: visionbrkr | July 23, 2010 11:05 AM | Report abuse

I'm confused, does Ezra Klein work for the Washington post or is the national democratic party?

Posted by: ecocampaigner | July 23, 2010 11:51 AM | Report abuse

To be honest, the BP disaster probably killed the chances for climate change legislation. Back when it looked like there would be Republicans on board, the bills included offshore drilling expansions along with the carbon tax (were being sold in no small part as 'energy independence'). Now the only chip the Dems had to offer to the Repubs has turned toxic. Now climate change has to find a new alliance, and couple itself to some other reasonably popular cause (energy independence, protecting our manufacturing sector, job growth, etc.).

It also hasn't helped that gas prices have been stable and reasonable so far this year.

It also hasn't helped that we have morons like David Roberts in the environmental movement who believe that the magic EPA faeries will come and save us from climate change.

Posted by: eggnogfool | July 23, 2010 12:08 PM | Report abuse

"I'm confused, does Ezra Klein work for the Washington post or is the national democratic party?"

The correlation between inability to form a proper english sentence and belief that the Journolist story is of interest is pretty clearly statistically significant.

I wonder which way the causality arrows should go...

Posted by: eggnogfool | July 23, 2010 12:14 PM | Report abuse

ecocampaigner, if you're going to bring that weak crap in here, then I'm going to point out that you need grammar lessons. Booyah!

Kevin, I necessarily disagree with your comments on reportage, but want to add a couple things. First, I think most bias in the neutral news reportage is probably unintentional. A lot of the time I think a reporter may try to be unbiased but either doesn't realize that they're being unfair in their presentation or are using bad tools (like a false equivalence to show balance) to achieve it. Other times, I think the bias comes from the institution rather than the reporter. I think reporters these days are under a lot of pressure to break big, sensational stories fast, and that sometimes presents itself in the story as hyping aspects which are unfair but likely to get ratings/viewers/etc., or getting the story published so quickly that there's not enough due diligence, fact checking, or good writing.

I think reporters have always been as partisan and opinionated in their personal lives as they are now, they just had fewer pressures and more time to work around it. And yes, I think this is as true of the reporters for Fox News as it is for any other outlet, though I think the institutional pressures at Fox are bigger and/or different than elsewhere. That said, I tend to think that with any outlet, but particularly with television, the bias comes out in how the story is presented rather than what the reporter did.

Also, I was 3 when TRON came out. But man, light cycles are boss.

Posted by: MosBen | July 23, 2010 12:21 PM | Report abuse

"The correlation between inability to form a proper english sentence and belief that the Journolist story is of interest is pretty clearly statistically significant."

I think the story is interesting, and I've exhibited my share of both dyslexic typing and malapropisms. So there may be something to your theory.

Posted by: Kevin_Willis | July 23, 2010 12:23 PM | Report abuse

@MosBen: "First, I think most bias in the neutral news reportage is probably unintentional . . ." etc.

Yeah, there's nothing I said that is in opposition to that. I was trying to encompass just those sorts of influences (institutional, economic, unconscious), rather than point to a particular kind of ideological bias.

I was 13 when Tron came out. I had it on Beta-Max. I've got it on DVD now, and can't wait until I can get it on Blu-Ray. I just love that film. "That's Tron. He fights for the Users."

Posted by: Kevin_Willis | July 23, 2010 12:29 PM | Report abuse

"The correlation between inability to form a proper english sentence and belief that the Journolist story is of interest is pretty clearly statistically significant. "

The Journolist scandal was the other shoe dropping after the Climategate scandal. First we saw how climate scientists put their liberal agenda first, and the truth second. Now we get to see how liberal journalists who promote climate propaganda, also put their advocacy before their impartiality.

Posted by: ecocampaigner | July 23, 2010 12:52 PM | Report abuse

Man, you know, any post where you accuse someone of bad grammar must itself contain bad grammar.

Kevin, I meant to say, I *don't* necessarily disagree with your comments. I didn't think you'd disagree with me.

Now that I think about it, I guess my post was grammatically correct, just misleading from a typo.

ecocampaigner, you've seen, I'm sure, that the "Climate Gate" scientists have been cleared after review, right? That they acted with appropriate ethical standards? Aren't you glad you don't have to grind that ax any more? Your arm must have been getting tired!

Posted by: MosBen | July 23, 2010 1:08 PM | Report abuse

"ecocampaigner, you've seen, I'm sure, that the "Climate Gate" scientists have been cleared after review, right? "

Do you mean the Russel Muir Independent Review of the Science that was neither independent nor a review of the science? How could I have missed it?

The CRU investigated and cleared themselves. PSU investigated and cleared itself. The climate change advocates of the british labour government who advocate climate change, found their scientists innocent.

I bet if you let BP investigate BP's oil well disaster, they'll find themselves innocent too.

Whitewashing is irrelevant. What is relevant is that the DoE cut off millions in funding to the CRU. That's a verdict that actually matters.

Posted by: ecocampaigner | July 23, 2010 1:13 PM | Report abuse

@ecocampaigner: "Do you mean the Russel Muir Independent Review of the Science that was neither independent nor a review of the science? How could I have missed it?"

I gotta agree ecocampaigner on that. Unless I've missed something (and I understand the argument that the emails lack context, etc), that wasn't actually any kind of review.

"Are you guilty?"

"Oh, no sir, quite innocent."

"Then it's settled! He's innocent! Review concluded."

@eco: "I bet if you let BP investigate BP's oil well disaster, they'll find themselves innocent too."

In fact, I think their internal review has already concluded that BP was totally awesome. And "completely rocks the casbah".

Posted by: Kevin_Willis | July 23, 2010 1:23 PM | Report abuse

The Russel Muir Review: "So, can we look at all your documents?"

"Oh, yes, sir. Except those that I've already destroyed. And those that make me look guilty of something. And those that I don't want to show you."

"Fair enough. Well, right, right, looks like everything's in order here."


Posted by: Kevin_Willis | July 23, 2010 1:27 PM | Report abuse

My understanding of the review was that it did not review the substance of their findings, but did review their procedures to ensure that they were following ethical standards. And I'm sorry, but review of your peers is central to science.

I'm not going to put some academics who may have fudged their data in front of some Republican committee, or a BP ethics panel, or whatever arbitrary panel ecocampaigner would deem to be fair. It's not like the scientists themselves declared their work to be ethical. Their peers and bosses at their institution reviewed their work to ensure that it was done in an ethical way, just as any ethical issue that wasn't an international incident would have been resolved.

And, of course, there simply isn't even much that stirred up this controversy. The guy used the word "trick" which was taken out of context by the media and people eager to declare climate change dead.

Posted by: MosBen | July 23, 2010 4:23 PM | Report abuse

And frankly, if you want to doubt the review process, it should really be incumbent on you to look at their review procedures and findings and point out things which show this to just be a whitewash. That you don't like the result of the scientists' behavior being cleared isn't enough to base a good faith continued doubt about climate change or the review procedures used here.

Posted by: MosBen | July 23, 2010 4:26 PM | Report abuse

It seems to me that what in reality the MAIN approach that has LONG been used to IN ESSENCE "DERAIL" (or at least greatly IMPEDE!) any actual substantive reconstitution of "our" energy diet in this society has been a "bait and switch" tactic!

The notion is endlessly "cultivated" in the “popular (mis)conception” of things that the whole menu of possibilites for "alternative" energy reduces to just a couple of not-terribly-appealing “old standards”: WIND power (involving those huge, very expensive towers that are so inherently gawky and problematic in regard to making noise and bashing birds) and LARGE ROOFTOP PHOTOVOLTAIC ARRAYS (that probably most folks would consider to be at best "unsightly". And high-voltage transmission Lines are hardly "scenic wonders" either. The WHOLE SUBJECT is thereby thus actually subtly "FINESSED" by the very way in which it is perpetually posed to a LARGELY TECHNOLOGICALLY IGNORANT "general public"!

Note that I did NOT say a STUPID general public; rather, I said IGNORANT --- which signifies LACKING IN INFORMATION (AND THEREFORE UNDERSTANDING), rather than being somehow deficient in intrinsic intellectual capacity! Moreover, IGNORANCE is NOT NECESSARILY the FAULT of the person who is afflicted with it --- although it CAN be, when that person is DERELICT IN FULFILLING HIS/HER RESPONSIBILITY TO PROPERLY INFORM HIM/HERSELF, and to actually SEEK OUT the FULL complement of basic information needed to consider issues intelligently)!

It seems to me that the powers-that-be "vested" economic interests that would prefer to perpetuate the status quo for as long as they possibly can generally POSE the whole "issue", and "steer" the entire "discussion", in terms that IGNORE what would come across to many as MUCH MORE DESIRABLE alternatives --- if very many people actually KNEW anything about them! The WHOLE SUBJECT thus ends up in effect being "politically killed off" by a "reductio ad absurdam" technique --- AND THE BABY GOES OUT THE WINDOW ALONG WITH THE BATH WATER! People would quit dithering and blathering about some of the things that “serve” to EXTINGUISH actually-informed thinking about the whole subject of “Alternative Energy” if they ACTUALLY KNEW about many alternatives about which they DON’T HEAR in the “mainstream” discussion of the whole issue!

Posted by: BirdsAbound | July 24, 2010 9:41 PM | Report abuse

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