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Wonkbook: Dems look to Collins; energy bill delayed; drilling ban may end early; Kagan to be confirmed tomorrow.

Lacking the votes needed to break a filibuster, Harry Reid has given up on passing a bill responding to the oil spill before the August recess; Democrats have now offset the state aid bill with an $11.9 billion cut in food stamps and they're still not sure they have the votes; the new head offshore drilling regulator says the Obama administration may lift its drilling moratorium before it was due to end; and Elena Kagan is on track to be confirmed tomorrow afternoon or evening.

Ah, Wednesday. Welcome to Wonkbook.

Top Stories

Susan Collins is the swing vote on aid to states, reports David Rogers: "Food stamp recipients would face an $11.9 billion rollback of added benefits first approved as part of the giant recovery bill last year. That translates into a reduction of about $47 a month for a family of three beginning in April 2014 or $516 over the first 12 months. And among budget experts, some believe that CBO’s $11.9 billion estimate understates the real savings...The White House has reached out to Collins, who appeared open to backing at least the Medicaid funds but leery of being the only Republican vote in this partisan climate."

The Senate won't consider an oil spill response bill until after the August recess, reports Coral Davenport: "Some Democrats and environmentalists said they are optimistic the extra time will allow them to revisit the broader renewable energy provisions they had to jettison earlier, in hopes of folding them into the drilling bill...Central to the offshore drilling reform bill was a title to eliminate the $75 million liability cap on damages oil companies must pay in the case of spills and other disasters. Sens. Mary Landrieu (D-La.) and Mark Begich (D-Alaska), both close allies of the oil industry, made clear they opposed that provision."

The Obama administration may end the offshore drilling ban early, reports Juliet Eilperin: "Michael Bromwich, who heads the agency that has replaced the Interior Department's Minerals Management Service, will hold a series of public forums starting Wednesday in New Orleans. The meetings will explore the current system for drilling and workplace safety, oil and gas containment, and spill response. The eight hearings on the Gulf Coast and in Anchorage, he said, will determine 'whether we can develop a level of comfort on all three issues that would enable the [interior] secretary to lift the moratorium in a principled way' before Nov. 30."

Elena Kagan will be confirmed at some point tomorrow, reports Paul Kane: "With five GOP senators already supporting Kagan's nomination, Republicans are not planning to force a filibuster vote. One Democrat, conservative Ben Nelson (Neb.), has announced his intention to oppose her. She is likely to get 63 to 65 votes approving her confirmation, which is fewer than the 68 for Justice Sonia Sotomayor in August 2009 but more than the 58 for Justice Samuel A. Alito Jr. in 2006."

Live Jersey rock interlude: The Gaslight Anthem play "Bring It On" at Bonnaroo.

Still to come: The fate of the state aid bill is in Susan Collins' hands; BP's final kill plan for the leaking oil well is underway; health care reform's countless panels and commissions are beginning to be set up; and buses that drive on top of other cars.


Consumers are saving more than they have in a year:

Congressional Democrats' jobs push will focus on manufacturing, report Lori Montgomery and Brady Dennis: "That approach, heralded by Obama last week in Detroit and sketched out in a memo to House Democrats as they headed home for the August break, is still evolving and so far focuses primarily on raising taxes on multinational corporations that Democrats accuse of shipping jobs overseas. The strategy also repackages policies long pursued by the White House -- such as investing in clean energy, roads, bridges and broadband service -- with more than two dozen legislative proposals aimed at developing a plan for promoting domestic manufacturing."

State governments are cutting salaries rather than using furloughs:

The Fed is foreclosing on some homeowners whose mortgages it got in the Bear Stearns collapse, report Serena Ng and Carrick Mollenkamp: " portfolio's residential and commercial loans were worth about $5 billion recently, compared with $9.6 billion in March 2008, when Bear Stearns collapsed, illustrating the financial pain other U.S. banks are experiencing as they deal with their own souring holdings of home loans, offices, hotels, shopping centers and land. So far, buyers have been found for about $1 billion in commercial loans. The New York Fed's holdings of commercial-real-estate debt lost 35% of their value over the two years ended March 2010, while a pool of residential loans fell about 60%, according to New York Fed documents and people familiar with the matter."

Businesses are split over Senate Democrats' proposal to end tax breaks to businesses abroad:

David Leonhardt outlines how the labor market punishes mothers:: "A recent study of business school graduates from the University of Chicago found that in the early years after graduating, men and women had 'nearly identical labor incomes and weekly hours worked.' Men and women also paid a similar career price for taking off or working part time. Women, however, were vastly more likely to do so. As a result, 15 years after graduation, the men were making about 75 percent more than the women. The study -- done by Marianne Bertrand, Claudia Goldin and Lawrence Katz -- did find one subgroup of women whose careers resembled those of men: women who had no children and never took time off."

Harold Meyerson argues appointing Elizabeth Warren would help small businesses:

Edward Glaeser argues that cheap credit didn't cause the housing crisis: "Theory and data both predict that the 1.2 percentage point drop in real interest rates that American experienced between 1996 and 2006 should cause a price increase of somewhat less than 10 percent, yet prices actually rose over this period by more than 40 percent. Since interest rates have stayed low, low real rates can’t explain the post-boom drop in prices either. Standard models and statistical work don’t predict that the observed swings in real rates should have led to such massive housing price fluctuations."

Mass transit interlude: Buses that cars can driven underneath.


The gulf "static kill" operation is underway, reports Joel Achenbach: "BP initiated the process of pumping mud into the blown-out Macondo well at about 4 p.m. Tuesday. The static kill is not a quick operation by design, pumping mud at a leisurely rate of 2 barrels per minute. About 2,000 barrels will be needed to fill the well, engineers have calculated. Ideally, the heavy mud will cause the pressure in the well to drop to zero -- but that alone won't mean the well is dead, according to federal scientists. The well could be playing dead."

BP has sold off another $1.9 billion in assets:

BP is facing retaliation for not paying off a pro-oil pressure group, reports Dan Eggen: "Days after the Deepwater Horizon oil rig sank in the Gulf of Mexico, a conservative nonprofit group called the Institute for Energy Research asked BP to contribute $100,000 for a media campaign it was launching in defense of the oil industry. Although BP took a pass, the group's advocacy arm went ahead with a campaign -- only instead of defending BP, it vilified the company as a "safety outlier" in an otherwise safe industry. The campaign's Web site features dozens of images of the burning rig, oil-smeared birds and other environmental devastation from the spill."

Energy czar Carol Browner and cleanup head Ray Mabus are heading to the Gulf:

Electric vehicles are a major growth industry, reports Keith Schneider: "In 2009, Deutsche Bank estimated global sales of electric, hybrid and other alternative-fuel, advanced-technology vehicles could rise by 30 percent this year, to 1.3 million. J. D. Power recently estimated that hybrid and electric vehicles could account for about 1.3 percent of an estimated 67 million in light-vehicle sales worldwide this year. And the D.T.T. Global Manufacturing Industry Group estimates that by 2020, electric vehicles and other “green” cars will represent up to a third of total sales in developed markets and up to 20 percent in urban areas of emerging markets."

The environmental effect of oil dispersants in the Gulf is still unclear:

David Roberts argues that popular mobilization could not have passed an ambitious climate bill: "Average citizens know almost nothing about politics and even less about policy; they don't care very deeply about climate change; they are highly cynical and suspicious of government and policy elites; the mechanisms that served to drive public discontent on civil rights (and other '60s victories) are not available to climate campaigners due to the nature of the issue -- the harms are mostly far away in time and space and the costs are immediate. And we're not just talking about persuading 'the people' to get active, we're talking about creating a credible electoral threat in Nebraska and West Virginia. They're receptive to policy arguments from left intellectuals there, right?"

Comic mashup interlude: Kanye West quotes matched with New Yorker cartoons.

Domestic Policy

The Congressional Research Service can't count the number of commissions in health care reform, report Gloria Park and Fred Barbash: "The law says a lot about some of them and a little about many, and merely mentions a few. Some have been authorized without any instructions on who is to appoint whom, when that might happen and who will pay. Those agencies created without specific appointment or appropriations procedures will have to wait indefinitely for staff and funding before they can function, according to Copeland’s report."

Obama will renegotiate the South Korea trade deal to include worker's rights protections:

Missouri has passed a ballot initiative opposing the individual mandate in health care reform, reports Monica Davey: The measure was intended to invalidate a crucial element of President Obama’s health care law -- namely, that most people be required to get health insurance or pay a tax penalty...Practically speaking, it remains entirely uncertain what effect the vote will have. The insurance requirement of the federal health care law does not come into effect until 2014. By then, experts say, the courts are likely to weigh in on the provision requiring the purchase of insurance."

The children of working mothers do not see worse outcomes:

Steven Pearlstein questions the potential for social science to solve tough policy questions: "Students at charter schools tend to get higher scores on achievement tests than those who remain in public schools, but is it the schools that account for the difference or just the ambitions of the charter school parents?...These are examples of the challenging questions that face policymakers and business executives every day. What makes these questions so hard to answer is that while past experience may be helpful, there's often no easy way to untangle a particular outcome from the various factors that may have caused it."

Mark Kleiman speaks up for social science:

Richard Lugar calls for bipartisan agreement on the childhood nutrition bill: "Research shows that food insecurity and hunger rise during the summer, when children don’t have regular access to school meals. The bill would continue to enlarge programs, operated through organizations like local recreation departments, that help feed young people when schools aren’t in session. Year-round child nutrition programs, on top of improving children’s health and teaching them to eat better, are critical to academic success. The school breakfast program has been directly linked to gains in math and reading scores, attendance and behavior, and speed and memory on cognitive tests."

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

By Ezra Klein  |  August 4, 2010; 6:30 AM ET
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Next: What do Republicans believe on state aid?


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 . 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: caryblair | August 4, 2010 7:13 AM | Report abuse

--"Missouri has passed a ballot initiative opposing the individual mandate in health care reform"--

Obama needs to send in the National Guard and lock those crazies DOWN. Break a few heads if he has to. Don't those people know what's good for them????

Posted by: msoja | August 4, 2010 8:53 AM | Report abuse

actually Ezra this is my favorite part of the politico article on the uncountable number of agencies within HCR.

"The legislation, for instance, mandated HHS to establish an Interagency Task Force to Assess and Improve Access to Health in Alaska by May 7, as well as an Advisory Committee on Breast Cancer in Young Women by May 22.

HHS has yet to appoint members to the breast cancer committee and is currently reviewing nominations, according to HHS spokeswoman Jessica Santillo. The Alaska task force didn’t hold its first meeting until July 16."


one big bureaucratic MESS. And look, they're missing deadlines. No surprise. Yet if insurers missed a deadline I'm sure Ms. Sebelius would be all up in arms about it.

How are those high risk pools coming along? All of them up yet when they were supposed to be up in June? All of them have individuals covered, getting treated, paying claims???

Posted by: visionbrkr | August 4, 2010 9:38 AM | Report abuse

I wish the Dems would focus less on the regulation side of the energy issue (the cap on damages is a loser issue IMHO), and more on fixing the perverse economic incentives to drill: refocus tax breaks and other subsidies from dirty energy to clean energy. Of course Landrieu and Begich will still make a stink.

Posted by: jeirvine | August 4, 2010 10:06 AM | Report abuse

@msoja: "Obama needs to send in the National Guard and lock those crazies DOWN. Break a few heads if he has to. Don't those people know what's good for them????"

Msoja, you need to work on your sarcasm. I've seen some actual lefties who had said pretty much exactly that, re: Arizona (in comment sections, not in live person-to-person interactions). When I first read it, before getting to your name, I thought you were serious.

Posted by: Kevin_Willis | August 4, 2010 11:39 AM | Report abuse

Barry Ritholtz brings Ed Glaeser back to reality regarding low interest rates and the causes of the housing bubble:

Posted by: scott_teresi | August 8, 2010 2:28 PM | Report abuse

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