Wonkbook: Truce on Senate rules is holding; WH starts announcing budget cuts; Obama heads to the Chamber
If you were watching the Superbowl in the DC area last night, one of the ads you saw came from the No Food Taxes coalition (which includes 7-Eleven, Alcoa, the Mid-Atlantic Petroleum Distributers Association, American Airlines, McDonald's, and many more). It showed a sensible-looking woman putting soda into her shopping cart and complaining that "some politicians" are "trying to control what we eat and drink with taxes." Pulling into the checkout lane, a deep-voiced announcer intones, "government needs to trim its budget back, and leave our grocery budgets alone." Watch the ad here.
It's evidence of how seriously the sugared drink industry takes the threat of a soda tax. And, in the interest of balance -- I did link to the ad -- here's David Leonhardt making the case for one. But a federal soda tax doesn't currently exist and, if it did, it would reduce deficits, so it's not really a great place to concentrate your energies if you want to reduce budget deficits and ensure a level-playing field in the snack foods aisle. That said, however, I'd like to propose common cause with my brothers and sisters in the Coca-Cola Company. Government does need to trim its budget back. And it probably should be doing less to influence us in the checkout lines. So let's make this the year we finally end subsidies to the corn industry. Deal?
The easy cuts to the budget have already been made, writes OMB director Jacob Lew: "In each of the past two years, the administration has put forward about $20 billion in savings from ending some programs and reducing funds for others. This entailed finding programs that were duplicative, outdated and ineffective. But to achieve the deeper cuts needed to support this spending freeze, we have had to look beyond the obvious and cut spending for purposes we support. We had to choose programs that, absent the fiscal situation, we would not cut."
"Since they were instituted, community service block grants have helped to support community action organizations in cities and towns across the country. These are grassroots groups working in poor communities, dedicated to empowering those living there and helping them with some of life’s basic necessities. These are the kinds of programs that President Obama worked with when he was a community organizer, so this cut is not easy for him. Yet for the past 30 years, these grants have been allocated using a formula that does not consider how good a job the recipients are doing. The president is proposing to cut financing for this grant program in half, saving $350 million, and to reform the remaining half into a competitive grant program, so that funds are spent to give communities the most effective help."
The Senate's informal truce on rules reform is holding, reports Carl Hulse: "Under a rules truce struck in the Senate late last month, minority Republicans allowed a long-stalled aviation policy measure to come to the floor without a filibuster as the Senate’s first legislative business of 2011. In exchange, Senator Harry Reid of Nevada, the majority leader, has so far let Republicans offer ample amendments, including one politically charged whopper that would have repealed the new health care law. 'It worked,' Senator John Barrasso of Wyoming, a member of the Republican leadership...Last year, the situation would probably have unfolded very differently. Democrats would have tried to bring up the bill but then taken parliamentary steps to block amendments, to prevent Republicans from having an opportunity to make a political point. In retaliation, Republicans would have forced Democrats to assemble 60 votes just to get the bill to the floor."
Obama will speak to the Chamber of Commerce, report Peter Wallsten and Zachary Goldfarb: "The White House's campaign to rebuild ties with corporate America gets the ultimate photo opportunity Monday when President Obama crosses Lafayette Park and steps into the imposing headquarters of the U.S. Chamber of Commerce. The gesture may surprise Americans who recall that Obama, just four months ago, said the group may have used foreign money to air ads attacking Democrats...Obama, even as he calls for cooperation on a range of issues such as revamping the corporate tax code, passing a South Korea free-trade deal and fixing the nation's schools, will reiterate his defense of the new restrictions on insurance companies that make up the core of the health-care law that the Chamber wants repealed. And he will implore corporations to spend the profits that many are stockpiling."
Businesses are partnering with House Republicans to rid themselves of old, troublesome regulations, report Philip Rucker and David Hilzenrath: "Responding to solicitations from Rep. Darrell Issa (R-Calif.), businesses have asked Congress to roll back or preempt more than 150 rules governing their industries, according to documents obtained by The Washington Post...The rules under scrutiny include familiar issues suchas greenhouse gas emissions, health-care reform and the landmark Wall Street overhaul. But the committee also will examine more obscure regulations. For instance, makers of some cleaning products that remove mold and mildew have asked the committee to reconsider rules that require their products to be registered as pesticides under the Federal Insecticide, Fungicide and Rodenticide Act.
Streaming album interlude: James Blake's self-titled debut.
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Still to come: Obama broke a promise to support "cramdown" legislation helping homeowners; the health industry has given millions to members of Congress since health care reform passed; states are using spending cuts, not tax hikes, to balance their budgets; the EPA tops the list of agencies facing industry complaints to Congress; and a toddler who knows the period table of elements better than most adults.
Obama broke a pledge to force banks to assist homeowners, report Paul Kiel and Olga Pierce: "Before he took office, President Obama repeatedly promised voters and Democrats in Congress that he’d fight for changes to bankruptcy laws to help homeowners--a tough approach that would force banks to modify mortgages...But when it came time to fight for the measure, he didn’t show up. Some Democrats now say his administration actually undermined it behind the scenes...Instead, the administration has relied on a voluntary program with few sticks, that simply offers banks incentives to modify mortgages. Known as Home Affordable Modification Program, or HAMP, the program was modeled after an industry plan. The administration also wrote it carefully to exclude millions of homeowners seen as undeserving."
AIG has paid off its bailout loan and is on firmer footing: http://wapo.st/eeo0QR
France and Germany are working to defend the Euro by deepening European integration, reports Stephen Castle: "Initiating a bold effort to strengthen the euro, Germany and France on Friday laid down far-reaching plans to deepen integration among the 17 nations that use the currency. The move prompted immediate opposition, but could lead to embryonic economic government for Europe. After days of speculation, the proposal from the German chancellor, Angela Merkel, and the French president, Nicolas Sarkozy, was greeted with criticism from governments that fear they may have to raise corporate tax rates or scrap deals that link annual wage increases to inflation. At a European Union summit meeting in Brussels, several prime ministers from euro-zone countries, including Belgium’s caretaker premier, Yves Leterme, criticized the proposal or questioned the way it would operate."
Higher corporate profits aren't translating into job growth: http://on.wsj.com/dRy7Ib
Housing bubbles are rare, writes Robert Shiller: "This enormous housing bubble and burst isn’t comparable to any national or international housing cycle in history. Previous bubbles have been smaller and more regional. We have to look further afield for parallels. The most useful may be the long trail of booms and crashes in the price of land, particularly of farms, forests and village lots. Those upheavals may give some insights into the present situation, and some guidance for the next decade. In the 19th century and most of the 20th, speculation in land was a powerful phenomenon...Land manias have been rather infrequent, many decades apart. They suggest that the recent housing bubble is a similarly rare event, not to be repeated for many decades."
Credit card companies' "rewards" are sleights of hand, writes Steven Pearlstein: http://wapo.st/gZBSAA
Adorable kids who will rule us all interlude: A two-and-a-half-year-old wins a game of "name the chemical elements" with his dad.
Over $40 million in health industry donations have gone to Congress since the reform vote last year, reports Jeffrey Smith: "More than $42.7 million in health-care and health-insurance industry funds...have flowed to current Republican and Democratic lawmakers after each chamber voted on the Obama bill, according to the study of spending for that period...The study, conducted for The Washington Post by the nonpartisan Center for Responsive Politics, also shows that Republicans have been heavily favored in this period. While Democrats got just more than half of the industries' money before the bill was approved in spite of uniform Republican opposition, the Republican attracted 60 percent after the votes were counted.
If history is any indication, the Supreme Court will keep its public reputation regardless of how it rules on health care: http://nyti.ms/iebsZK
State need more flexibility in implementing health care reform, writes Mitch Daniels: http://on.wsj.com/eHUrXs
State budget proposals are heavy on cuts and light on tax hikes, report Conor Dougherty and Amy Merrick: "Governors around the U.S. are proposing to balance their states' budgets with a long list of cuts and almost no new taxes, reflecting a goal by politicians from both parties to erase deficits chiefly by shrinking government. On Monday, Florida Gov. Rick Scott, a newly elected Republican, is expected to issue a budget that cuts state spending by $5 billion and overhauls public-employee pensions. A Democratic governor, John Kitzhaber of Oregon, has proposed a two-year budget that would make cuts to mental-health institutions and reduce state Medicaid reimbursements to doctors and hospitals. Cuts to Medicaid, a joint state-federal program, are some of governors' largest proposed reductions."
Michelle Obama is working to cut a deal on nutrition with restaurants: http://nyti.ms/dJutrd
The FCC is revamping a fund for spreading broadband, reports Eliza Krigman: "Under pressure to expand high-speed Internet access around the country, Federal Communications Commission Chairman Julius Genachowski will Monday lay out a plan to revamp an antiquated $8 billion program to fund new broadband networks. Modernizing the program, known as the Universal Service Fund (USF), is a key part of meeting President Barack Obama’s goal of bringing wireless broadband connections to 98 percent of the country’s population, Genachowski told POLITICO...The USF program is one of the most arcane issues the FCC plans to tackle this year. It was formed 14 years ago to pay for telephone lines in low-income and rural areas. All phone companies must contribute some of their revenue to the fund."
The White House has again delayed an NRA-opposed rule targeting gun smuggling to Mexican cartels: http://wapo.st/i1LtxD
Adorable animals in slow-mo interlude: A chipmunk grooms himself.
The EPA faced more business complaints to Congress than any other agency, reports Louise Radnofsky: "The Environmental Protection Agency, which enforces rules that affect the U.S. economy from factories to farms, is the No. 1 target of complaints from business groups collected by House Republican leaders. EPA rules were cited more than those from any other agency in more than 100 letters sent by trade associations, businesses and some conservative groups to House oversight committee chairman Darrell Issa (R., Calif.) in response to his call for businesses to identify regulations they deemed burdensome, according to documents reviewed by the Wall Street Journal. The letters are scheduled for release today."
Sen. Jay Rockefeller is urging the coal industry to get on board with green tech: http://bit.ly/eH6wem
The White House denies its regulations contributed to Texas' rolling blackouts, reports Darren Samuelsohn: "President Barack Obama’s team wants the world to know his environmental policies had nothing to do with the rolling blackouts blanketing Texas this week. White House Communications Director Dan Pfeiffer swung back late Friday at conservative media and lawmakers who have pinned the blame on Obama for the lights going off across the Longhorn State amid extreme cold temperatures and high winds. The Electric Reliability Council of Texas, the lead regulatory agency in the region, says that weather was to blame for the mechanical failures at more than 50 power plants around the state."
Soaring food prices should serve as a climate change warning, writes Paul Krugman: "While several factors have contributed to soaring food prices, what really stands out is the extent to which severe weather events have disrupted agricultural production. And these severe weather events are exactly the kind of thing we’d expect to see as rising concentrations of greenhouse gases change our climate -- which means that the current food price surge may be just the beginning... Temperature records were set not just in Russia but in no fewer than 19 countries, covering a fifth of the world’s land area. And both droughts and floods are natural consequences of a warming world: droughts because it’s hotter, floods because warm oceans release more water vapor."
Closing credits: Wonkbook is compiled and produced with help from Dylan Matthews and Michelle Williams.
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