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Wonkbook: Dems to lose votes in lame duck; Senate looks at outsourcing; Carol Browner out

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You probably know that Senate Democrats are delaying a vote on the Bush tax cuts until after the election. In its place, they'll be voting on a mostly symbolic bill to discourage companies from outsourcing jobs. What you may not know, however, is that this means Senate Democrats will have fewer votes when they actually do vote on the Bush tax cuts. Three Democrats -- Roland Burris from Illinois, Ted Kaufman from Delaware, and Carte Goodwin from West Virginia -- are filling vacancies on a temporary basis. Their terms end on November 2nd, and their replacements, who must be seated immediately, may well be Republicans.

So when the Senate returns for its lame duck session, Democrats will be, well, that much lamer, and that much less able to hold the line against a full extension of the Bush tax cuts. Add in that they won't have the political pressure of an election behind them, and the decision to delay the vote may, in the end, be the reason the Democrats lose it.

Last night's Mad Men seemed a bit crowded, no? Comparatively, today's Wonkbook is easy and straightforward. Welcome.

Top Stories

The Senate is considering a bill to discourage companies from outsourcing jobs, reports Michael Phillips: "Democrats admit they don't have enough votes to defeat a possible attempt by Republicans to block the bill. But they hope that bringing the issue to the Senate floor will underscore their concern about unemployment, now at 9.6%. 'This is another in a series of bills designed to try and provide jobs here at home for the American people,' a spokesman for Senate Majority Leader Harry Reid said Sunday. 'Just because the Republicans say 'No,' doesn't mean we shouldn't try.'"

Democrats could lose votes during the lame duck session, reports Danny Yadron: "Lawmakers are typically seated in January. But deaths, a resignation and a series of Democrats taking jobs in the Obama administration forced six states to fill Senate vacancies through appointment since 2008, including those created by the president and vice president. Terms for three of those appointed senators--from Illinois, West Virginia and Delaware--expire after elections Nov. 2. State laws require replacements to be seated immediately, and Republicans are seen as having a shot at winning in Illinois and West Virginia."

Much of the opposition to the health-care law comes from Americans who wish it went further: "A new AP poll finds that Americans who think the law should have done more outnumber those who think the government should stay out of health care by 2-to-1...Those numbers are no endorsement for President Obama's plan, but the survey also found a deep-seated desire for change that could pose a problem for Republicans. Only 25 percent in the poll said minimal tinkering would suffice for the health care system."

The House may hold a vote on the Bush tax cuts even if the Senate delays, reports David Herszenhorn: "Democrats who are lobbying for a vote say it could draw a stark contrast between the two parties by highlighting the potential willingness of Republicans to block tax relief for most Americans while insisting tax breaks for the rich. 'We will retain the right to proceed as we choose and would take it one day at a time,' Ms. Pelosi said at a news conference at the Capitol. 'But let me be very clear, as we have all been clear in the House Democratic leadership. America’s middle class will have a tax cut. It will be done in this Congress. There is no question about that.'"

Carol Browner might leave the White House, report Glenn Thrush and Darren Samuelsohn: "The collapse of the administration’s comprehensive climate change effort -- a career-long goal for Browner -- has stoked rumors that she’ll head for the exit rather than settle for an incremental, vastly scaled-back energy agenda. And some environmental advocates, deeply disappointed that Browner didn’t have enough clout to push climate change to the top of Obama’s agenda, blame her for the debacle. 'The real challenge at the top is, Carol Browner is not a strategic thinker,' griped one environmental advocate with close ties to the administration."

College rock interlude: Michelle Shocked performs "Anchorage".

Still to come: Why liberals need to fight harder for the health-care law; how a change in corporate taxes could bring in hundreds of billions in revenue; the economic benefits of increased immigration; a new study indicts lax gun laws; Howard Kurtz profiles Paul Krugman; and the world's best competitive eater challenges a bear.

Economy/FinReg

Reducing corporate taxes could boost revenue and fund stimulus spending, report Michael Fletcher and Jia Lynn Yang: "Congress enacted a tax holiday for corporate profits held overseas in 2004, lowering the rate for returned money to 5.25 percent. The measure raised the amount of repatriated foreign profits five-fold to nearly $300 billion. But rather than supporting job creation, a study found, much of the money went directly to shareholders - through increased dividends or expanded share buybacks."

Congress is investigating Fannie Mae's involvement with faulty foreclosure documents: http://bit.ly/cU9VvJ

The Postal Service's budget woes may come from an over-reliance on contractors: http://bit.ly/9Xg5rm

"Short sales" on homes are increasing, report Dina ElBoghdady and Dan Keating: "That kind of deal is called a short sale, and it's sweeping the country. In these deals, a lender allows a troubled borrower to sell a home for less than what's owed on the mortgage. Completed short sales have more than tripled since 2008, and 400,000 of these deals are projected to close this year, according to mortgage research firm CoreLogic. The giant mortgage financier Fannie Mae approved short sales on 36,534 home loans it owned in the first half of the year, nearly triple the number in 2007 and 2008 combined. Freddie Mac, its sister company, approved 22,117 in the first half of 2010, up from a mere 94 in the first half of 2007."

Howard Kurtz profiles Paul Krugman: http://bit.ly/dmgjyh

"Structural unemployment" is a fake problem, writes Paul Krugman: "Job openings have plunged in every major sector, while the number of workers forced into part-time employment in almost all industries has soared. Unemployment has surged in every major occupational category...Oh, and where are these firms that 'can’t find appropriate workers'? The National Federation of Independent Business has been surveying small businesses for many years, asking them to name their most important problem; the percentage citing problems with labor quality is now at an all-time low, reflecting the reality that these days even highly skilled workers are desperate for employment."

Obama shouldn't try to satisfy business, write Jacob Hacker and Paul Pierson: http://bit.ly/cubefX

We can grow our way out of the deficit, writes Edward Lazear: "Congress should begin limiting future spending according to an inflation-minus-one rule. That rule would hold that in any year when the ratio of government expenditures to GDP exceeds 18% (the 30-year average of tax revenues), Congress could increase spending only by the last three years' inflation rate, minus one percentage point. This would reduce the ratio of spending to GDP, because GDP growth would almost always exceed budget growth. There would be wrangling over what gets funded, but the amount of budget growth would be constrained."

Animated talk interlude: Steven Johnson explains where good ideas come from.

Domestic Policy

Liberals should go to war to defend health care reform, writes Matt Yglesias: "There's no country on earth that's moved to national health insurance and then moved back. And the U.S.A. will be no exception. But only if the move actually happens. And for that to happen, progressives need to recognize the stakes. It's completely true that the Obama administration hasn't given the left's activist base the care and feeding it needs and deserves. But at the end of the day, it has in fact given health care to sick kids. Its opponents want to take that away. A little less whining and a little more cheerleading from the left would make that less likely. Under the circumstances, more enthusiasm and a less self-pity and self-indulgence would be very welcome, not least by families hoping to be able to pay the bills next time someone falls ill."

Immigration helps American-born workers, writes Ezra Klein: "The mistake we make when thinking about the effect immigrants have on our wages, says Giovanni Peri, an economist at the University of California at Davis who has studied the issue extensively, is that we imagine an economy where the number of jobs is fixed. Then, if one immigrant comes in, he takes one of those jobs or forces a worker to accept a lower wage. But that's not how our economy works."

"With more labor - particularly more labor of different kinds - the economy grows larger. It produces more stuff. There are more workers buying things, creating demand. That increases the total number of jobs. We understand perfectly well that Europe is in trouble because its low birth rates mean fewer workers - and that means less economic growth. We ourselves worry that we're not graduating enough scientists and engineers. But the economy doesn't care if it gets workers through birth rates or green cards. In fact, there's a sense in which green cards are superior."

Lax gun control in some states spurs crime in others, reports Eric Lichtblau: "The study also seeks to draw a link between gun trafficking and gun control laws by analyzing gun restrictions in all 50 states in areas like background checks for gun purchases, policies on concealed weapons permits and state inspections of gun dealers. It finds that, across the board, those states with less restrictive gun laws exported guns used in crimes at significantly higher rates than states with more stringent laws."

The American Bar Association is becoming more openly left-leaning: http://politi.co/9YcWuy

The Department of Health and Human Services is targeting insurers discontinuing kids-only plan, reports Jennifer Haberkorn: "HHS also issued new regulatory guidance that could make it easier for insurers to sell the policies. The agency said insurers could raise rates based on health condition -- though doing so will be illegal beginning in 2014; issue different rates for child-only policies and dependent children; impose a surcharge for dropping coverage and subsequently reapplying; and instituting rules to preventing 'dumping' the policies. The moves are likely to drive premiums up, if insurers choose to start selling the policies again."

Volunteers providing water to illegal immigrants are legally vulnerable: http://nyti.ms/dhTzo5

A new book from Supreme Court justice Stephen Breyer fears for the Court's legitimacy, writes Lincoln Caplan: "The New Yorker’s Jeffrey Toobin points to the judicial activism of Chief Justice John Roberts and the conservative majority as a major source of apprehension for Justice Breyer. In a profile this week, Mr. Toobin describes Justice Breyer as 'unskilled in the art of the poker face' and says that he used last January’s Citizens United decision 'to take a shot at Roberts' in the book. In that ruling, the conservatives gave corporations an unlimited right to spend money in politics. Justice Breyer said they disregarded 'a traditional legal view that stretched back as far as 1907,' and had recently been affirmed."

Uwe Reinhardt outlines steps for reducing health care costs: http://nyti.ms/cOOdl4

Man versus nature interlude: Takeru Kobayashi challenges an Alaskan kodiak bear to a hot dog eating contest.

Energy

Engineering experts are skeptical of BP's report on the oil spill: http://nyti.ms/bK5V4r

Alabama businesses resent the BP oil spill payment process, reports Mike Esterl: "Despite a sharp acceleration in payments in recent days, many tourism-dependent businesses said the oil-spill claims process hasn't improved and some said it has worsened since independent administrator Kenneth Feinberg took the reins of a $20 billion BP-financed fund. Before that, the oil giant directly handled private-sector claims for lost income. Boat-repair companies, beach-umbrella rental outfits and retailers along Alabama's 30-mile coast said they have been short-changed or not paid at all since filing claims after the April 20 spill sent revenue plunging."

The nation's gas pipelines suffer from a lack of oversight: http://nyti.ms/djMLZe

Investigators have a new theory of how the BP cap blew, reports Siobhan Hughes: "'I'd like to just maintain the possibility that one reason that the cement job may have failed was because of fracking at the time of cementing,' said Mark Zoback, a Stanford University geophysicist who serves on the National Academy of Engineering panel investigating the causes of the April 20 disaster. The remarks, at a meeting convened at the National Academy of Engineering, undercut BP's effort to assign blame for the April 20 Deepwater Horizon explosion to its contractors instead of its own well design."

A new book indicts polluters for evading regulators: http://bit.ly/9g28r0

Solar power is spreading in Asia, writes Bettina Wassener: "May, the Asian Development Bank started a major drive to promote solar power across the region. Last year, the Indian government approved an ambitious National Solar Mission, which seeks a huge increase in the country’s solar-energy capabilities. Bangladesh, with the support of the World Bank, is aiming to have one million remote rural homes supplied with solar panels by the end of 2012. And in India, where nearly 40 percent of households have no access to electricity, companies like Selco Solar and Orb Energy have helped tens of thousands of families and small entrepreneurs purchase solar panels."

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

By Ezra Klein  | September 27, 2010; 6:28 AM ET
Categories:  Wonkbook  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Reconciliation
Next: Column: The payoff from immigration

Comments

Judicial activism by Chief Justice Roberts and the conservative majority of the court is bad for the country comments Justice Steven Breyer.

I have no doubt that Justice Breyer applauded the judicial activism of the Earl Warren court and the opinions of William O. Douglas and his fellow liberal judges.

The American people desire the courts to interpet the laws of the country and not to write the laws of the country.

Nothing more!

Posted by: mwhoke | September 27, 2010 9:02 AM | Report abuse

If you want to stop outsourcing of jobs, you need to create a business-friendly environment: 1) Get rid of the job-killing unions! 2) Get rid of the job-killing unions! 3)Get rid of the job-killing unions!
As someone who worked for over 15 yrs. in a company where manufacturing was unionized , I witnessed first-hand the following:
1) outdated union rules prevented company from using up-to-date mfg. methods;
2) Massive "down-time" due to excessive union meetings during normal work hours;
3) unions demanding 8 hr. pay for 6 hrs. of work.
4) inflexibility, inability to respond to "real time" customer requests, due to rigid union rules
5)greedy Cadillac health benefits resulted in few, if any insurance companies willing to bid on health insurance, driving costs up;
6)unions prevented company from adjusting workforce to lower sales volume, resulting in higher expenses than necessary, negatively affecting financials
7) unions can't change fast enough to keep up with global economy/competition
8) greedy pension benefits that only encourage "entitlement mentality" and create unmotivated workers
Etc., etc., etc.

Posted by: ohioan | September 27, 2010 9:33 AM | Report abuse

Here's a link for "Animated talk interlude: Steven Johnson explains where good ideas come from":
http://www.ted.com/talks/lang/eng/steven_johnson_where_good_ideas_come_from.html

Posted by: suehall | September 27, 2010 9:43 AM | Report abuse

"Congress could increase spending only by the last three years' inflation rate, minus one percentage point. This would reduce the ratio of spending to GDP, because GDP growth would almost always exceed budget growth. There would be wrangling over what gets funded, but the amount of budget growth would be constrained."

So all Congress needs is a little rule to help them stay on track? Maybe I'm cynical, but I'd expect this rule to be ignored the moment it requires cutting entitlement spending.

Posted by: justin84 | September 27, 2010 9:44 AM | Report abuse

very good article as usual by Dr Reinhardt.

"That may be achieved through ever-higher cost-sharing by patients at point of service – that is, through ever-higher deductibles and ever-higher coinsurance, if not outright lack of health insurance"

but what I would remind him is that PPACA does not allow deductibles high enough and maximum costs high enough to exert enough pressure on costs.


There is no good answer except for the one thing that actually did work for a short time in the 1990's (CAPITATION). And in this political climate that will be next to impossible.

Posted by: visionbrkr | September 27, 2010 10:22 AM | Report abuse

4 R co-sponsors for the RES http://www.reuters.com/article/idUSTRE68N4J620100924

Posted by: jackjudge4000yahoocom | September 27, 2010 10:31 AM | Report abuse

mwhoke, well, according to the article Justice Breyer has voted to overturn acts of Congress less often than any of his collegues, so I'm not sure your assumption is well founded. Furthermore, the issue of "making" law on the bench is a bit of a gray area. For one thing, any time a court applies general statutory language to specific cases they "make" law. Frequently the statutory language isn't so specific that everyone understands it to mean the same thing. Faced with two competing and contradictory interpretations of a law decision by a judge will be deemed "interpretation/application" by those who agree with the decision and "making law/judicial activism" by those who disagree.

Also, there are freaquently laws which themselves seem to contradict each other, at least in a specific instance. In deciding the case a just will will be making law in deciding how each law works in the specific situation.

And the interpretation of laws will always affect more people than the specific litigants in that case. Resolving a divorce can change how millions of other cases turn out if the first case is precedential. And let's remember that the Court's primary function is in interpretation of the Constitution. If Congress passed a law allowing for "cruel and unusual punishment of prisoners", the Supreme Court would (let's hope!) invalidate that law because it is superceded by the Constitution.

"Judicial activism" is just a buzz word for results you don't like. Cases are wrongly decided for other reasons.

Posted by: MosBen | September 27, 2010 12:25 PM | Report abuse

What does this say about Obama? Well, how long do you have?

Posted by: georges2 | September 27, 2010 1:18 PM | Report abuse

Lichtblau is an anti-gun screwball who doesn't explain how restricting the 2nd Amendment rights for honest citizens fights crime.

Criminals will still get guns, but disarming the honest public puts them in greater danger.

When seconds count, a cop is only minutes away.

"An armed society is a polite society".

Posted by: TexRancher | September 29, 2010 7:15 AM | Report abuse

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