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Posted at 8:31 AM ET, 02/18/2011

Wonkbook: Wisconsin heats up; Boehner risks shutdown; health care defunding begins

By Ezra Klein

By Dylan Matthews

Matthews is writing Wonkbook while Ezra is traveling.

Top Stories

Obama is siding with state workers in Wisconsin's state budget brawl, report Brady Dennis and Peter Wallsten: "President Obama thrust himself and his political operation this week into Wisconsin's broiling budget battle, mobilizing opposition Thursday to a Republican bill that would curb public-worker benefits while planning similar action in other state capitals. Obama accused Scott Walker, the state's new Republican governor, of unleashing an 'assault' on unions in pushing emergency legislation that would nullify collective-bargaining agreements that affect most public employees, including teachers... By the end of the day, Democratic Party officials were working to organize additional demonstrations in Ohio and Indiana, where an effort is underway to trim benefits for public workers."

John Boehner is threatening a government shutdown in the absence of immediate budget cuts, report Paul Kane and Shailagh Murray: "As the House continued its marathon debate Thursday over a bill to fund the federal government, House Speaker John A. Boehner (R-Ohio) acknowledged that Congress might not reach agreement over spending cuts before the government runs out of money next month. But Boehner ruled out passing a temporary funding resolution to keep the government operating unless it contained at least some spending cuts. Democratic leaders in the Senate said that position increased the risk of a federal shutdown. The government is currently operating under a temporary funding measure, which expires March 4."

House Republicans have begun in earnest the effort to defund health care reform, reports N.C. Aizenman: "Republicans launched this week the first of what they vow will be a series of attempts to use their control of the House of Representatives to defund the health-care overhaul law. Rep. Denny Rehberg (R-Mont.) offered an amendment to the pending bill to fund the final seven months of this year's budget...that would prohibit administration officials from using any of the money to implement the health-care law. The proposal appears likely to make it into the final version of the budget bill that the House is about to vote on. But the defunding effort faces two major obstacles: Democrats control the Senate and the White House, and nearly all funds the federal government will need to implement the law were appropriated in the law itself."

Late-night hip hop interlude: Odd Future play "Sandwitches" on Late Night with Jimmy Fallon.

Still to come: The House's budget cuts are getting deeper by the day; the Justice Department wants an anti-health care reform judge's help in moving implementation forward; the House voted to block net neutrality rules; a judge is forcing the administration to settle on an offshore drilling policy; and an all-too-literal cat burglar.


Economy

The amendment process in the House is making cuts deeper and deeper, reports David Rogers: "With tensions rising, House Republicans pushed through a third long night, hoping to win passage late Friday of more than $60 billion in immediate spending cuts that would severely affect agencies in the second half of this fiscal year. The leadership put the brakes on deep additional cuts, but a school reform program important to President Barack Obama would be decimated by a $336 million reallocation of funds approved by 249-179. The National Endowment of the Arts narrowly lost an additional $22.5 million. And in a blow to the president, Democrats failed to restore $131 million for the Securities and Exchange Commission, facing new responsibilities under Wall Street reforms enacted in the last Congress."

A "Gang of Six" is behind the bipartisan debt reduction effort: http://wapo.st/gzPVZM

Financial regulators told Congress yesterday that budget cuts are hurting their work, reports Brady Dennis: "The Securities and Exchange Commission, led by Mary Schapiro, and the Commodity Futures Trading Commission, headed by Gary Gensler, are wrestling with how best to bring transparency and oversight to the vast 'over-the-counter' financial derivatives and swaps markets. Schapiro and Gensler told the panel that budget pressures are hampering their efforts. Schapiro said the SEC has had to restrict hiring, cut travel and put technology updates on hold. 'And that's having an impact on our ability...to achieve our core mission as effectively as we could,' she said. Gensler said the trading commission needs to expand to be able to manage its mission."

Elizabeth Warren has hired three people from the financial sector as deputies at the Consumer Financial Protection Bureau: http://on.wsj.com/eA4x8r

The administration is skeptical of plans for a corporate tax holiday, reports John McKinnon: "Amid a growing corporate push for a tax holiday, the Treasury Department's top tax official reiterated concerns about letting U.S. multinationals bring home hundreds of billions of dollars in overseas profits at low tax rates. For decades, U.S. tax policy has allowed multinational corporations to defer taxation of much of their overseas earnings until the money is brought home--or repatriated--to the U.S. By now, more than $1 trillion of U.S. corporate earnings is parked offshore, according to estimates. But companies have been reluctant to bring it back to the U.S., because of the relatively high U.S. tax rates they face."

Obama needs to lead on the deficit in public, not negotiate in private, writes David Brooks: http://nyti.ms/fJH87O

It'll take a liberal president to make progress on the deficit, writes GOP Senator Tom Coburn: "For the president, dealing with our debt threat could be his "Nixon goes to China" moment. Only a liberal Democratic president may be able to reform entitlements. Fortunately for the president, those of us who backed his own debt commission's plan have already gone to China. Sens. Dick Durbin (D-Ill.) and Kent Conrad (D-N.D.) committed the heresy of backing some entitlement reform. Sen. Mike Crapo (R-Idaho) and I backed tax reform that would lower rates dramatically, stimulate economic growth and generate revenue by doing away with dysfunctional subsidies such as that for ethanol...If the president decides to go to China, he'll find plenty of company. We're all waiting for him."

Adorable animals robbing people interlude: San Mateo's all too literal cat burglar.

Health Care

The Justice Department wants a judge who declared health care reform unconstitutional to okay its implementation, reports Jennifer Haberkorn: "The Justice Department on Thursday asked the Florida judge who struck down the health care overhaul to declare that the law must still be obeyed...Vinson last month struck down the entire health care reform law as unconstitutional, which has caused confusion for the states and federal government about whether they have to proceed with implementation. Some legal scholars and opponents of the law, including the governors of Alaska and Florida, believe the ruling has the effect of an injunction against the law, though Vinson declined to issue one."

House budget chair Paul Ryan's budget proposal will include major Medicare and Medicaid reforms: http://politi.co/eKBNen

We need more health care reform, not "entitlement" reform, writes Paul Krugman: "What would a serious approach to our fiscal problems involve? I can summarize it in seven words: health care, health care, health care, revenue. Notice that I said 'health care,' not 'entitlements.' People in Washington often talk as if there were a program called Socialsecuritymedicareandmedicaid, then focus on things like raising the retirement age. But that’s more anti-Willie Suttonism. Long-run projections suggest that spending on the major entitlement programs will rise sharply over the decades ahead, but the great bulk of that rise will come from the health insurance programs, not Social Security."

No one man should have all the power health care reform gives the HHS secretary, writes former Secretary Michael Leavitt: http://wapo.st/h0eB9G

Domestic Policy

The House voted to end funding for enforcing net neutrality rules, reports Cecilia Kang: "House Republicans voted Thursday to prohibit the Federal Communications Commission from using funds to carry out net neutrality regulations created last December. The vote was on an amendment to the continuing resolution introduced earlier this week by Communications and Technology subcommittee chairman Rep. Greg Walden (R-Ore.). Sens. Kay Bailey Hutchison (R-Tex), Mitch McConnell (R-Ky.), and John Ensign (R-Nev.) on Wednesday introduced a similar amendment aimed to knock down the FCC's rules that prohibit Internet service providers from blocking or arbitrarily slowing traffic on their networks. Ultimately, the amendment needs to pass both chambers and not be vetoed by President Obama."

Obama traveled to Silicon Valley to court the support of Steve Jobs, Mark Zuckerberg, Eric Schmidt, and others: http://politi.co/hA5KDp

Education secretary Arne Duncan has voiced support for Wisconsin's teachers, reports Jennifer Epstein: "Education Secretary Arne Duncan is voicing support for the teachers pushing back against governors in Wisconsin and elsewhere across the country who are directly taking on teachers’ unions...'Governors across the country are facing, you know, tough budget issues - as the president is here - but we have to support our hardworking teachers and make sure that we do everything we can to help them do the critically important work they do every single day in the classroom,' Duncan said...Nonetheless, Duncan said he thinks there’s room for everyone to compromise."

The Senate has passed an aviation "jobs bill": http://politi.co/ebQ7Ow

Sen. Pat Leahy's bill to fight Internet piracy goes too far, writes Brad Plumer: "Leahy’s bill...gave the Attorney General the power to order websites accused of pirating to cease their activities, and, what’s more, it required the supporting companies a website needs to thrive--the financial transaction providers, the search engines, the advertisers, and the ISPs--to stop doing business with the offending site...Trouble is, identifying genuine infringers isn’t always so straightforward--and there’s always the prospect that overly broad powers could be abused by the government. After all, it’s one thing to go after a site that allows you to stream pirated movies. But what about a blog that merely links to said site--or an online discussion forum where members talk about the best places to downward bootleg films? "

'80s flashback interlude: The music video / trailer for Take Me Home Tonight.

Energy

The Obama administration has to decide on its drilling policy within the next month, report Stephen Power and Russell Gold: "A federal judge ordered the Obama administration to decide within 30 days whether to grant a set of five permits for deep-water drilling projects in the Gulf of Mexico, saying the administration's inaction on the requests is 'increasingly inexcusable.' The order, by Judge Martin Feldman of the U.S. District Court for the Eastern District of Louisiana, ratcheted up the pressure on the administration, which last fall lifted a months-long moratorium on deepwater drilling but has yet to grant any permits to drill new oil or natural-gas wells at depths greater than 500 feet."

A majority of voters in both parties oppose stripping the EPA of its ability to regulate climate change: http://bit.ly/fjs97z

Dylan Matthews is a student at Harvard and a researcher at The Washington Post.

By Ezra Klein  | February 18, 2011; 8:31 AM ET
 
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Next: Unions aren't to blame for Wisconsin's budget

Comments

Obama is right that Governor Walker should not look to stop Wisconson public employees from being able to collectively bargain but the problem that he faces is that Democrats do not want to actually negotiate with public employee unions, they want to pay them off for their hundreds of millions of dollars towards their elections. Its a clear conflict of interest that needs to be addressed.

http://www.opensecrets.org/orgs/list.php


For all the valid complaints about Citizens United, no one EVER speaks about this.

Posted by: visionbrkr | February 18, 2011 8:57 AM | Report abuse

great article on how MA is attacking healthcare costs too.

http://www.boston.com/lifestyle/health/articles/2011/02/18/patrick_unveils_plan_to_curb_health_care_costs/?page=full

“They’re saying this is not price regulation,’’ said Joe Alviani, vice president for government affairs for Partners HealthCare, the parent organization of Massachusetts General and Brigham and Women’s hospitals, large influential Harvard teaching hospitals that have been able to demand some of the highest prices in the market. But, he said, the powers of the commissioner will test that premise.

--it had better test that premise. Hospitals and large doctor practices need to be told DIRECTLY that they can't hide their increases in fees behind insurance company premiums any longer.

Sadly this proposed legislation would not go far enough but at least it starts to move in the right direction.

Posted by: visionbrkr | February 18, 2011 9:07 AM | Report abuse

"Obama accused Scott Walker, the state's new Republican governor, of unleashing an 'assault' on unions in pushing emergency legislation that would nullify collective-bargaining agreements"

Obama is to the left of FDR on this one:

"All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations. The employer is the whole people, who speak by means of laws enacted by their representatives in Congress. Accordingly, administrative officials and employees alike are governed and guided, and in many instances restricted, by laws which establish policies, procedures, or rules in personnel matters.

Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees. Upon employees in the Federal service rests the obligation to serve the whole people, whose interests and welfare require orderliness and continuity in the conduct of Government activities. This obligation is paramount. Since their own services have to do with the functioning of the Government, a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable."

http://www.presidency.ucsb.edu/ws/index.php?pid=15445

" Madison public schools are closed Wednesday because too many teachers are taking the day off to protest Gov. Scott Walker's proposal to limit union bargaining."

It's for the kids, isn't it?

http://www.startribune.com/local/116302179.html

Posted by: justin84 | February 18, 2011 9:14 AM | Report abuse

@justin,

They've been closed for several days if I understand correctly. Exactly what are the parents of these kids who work supposed to do while their kids are out of school and they actually have to work and can't spend the days and weeks protesting?


I likewise heard about FDR's views (on Mornign Joe the other day) and former Governor Rendell (a huge pro labor Democrat) basically said that these pension and budget issues need to be resolved. he stated that the pension "deal" put in place when he came into office ensured that his follower, Governor Corbett would have to come up with $500 million this year alone in additional pension payouts.

And as life expectancy grows these pension burdens will grow.

What I don't understand is why did unions do it? Did they not see at the onset of these pension deals that they were unsustainable and would have to be forced to be re-worked? Why not bargain for more reasonable current benefits at the time that could then say be invested for their benefit?

Posted by: visionbrkr | February 18, 2011 9:21 AM | Report abuse

It's a good thing we don't have any partisans here. LOL

There are proper ways to reform things. And there ways not to.

Gvmt works have rights too, especially in this age, unlike in FDR's era, where they are now being treated as scapegoats for the recession they did not cause and the harm that unwise, partisan sought, tax cuts are causing.

Walker is acting like a militant and a saboteur. It is clear he is doing this for ideology and to weaken the Dem party. He is not trying to figure out a way to solve his state's problems or to create jobs in a bipartisan or compassionate way. He wants his tax cuts, and if that means 1000s people lose their voices, pensions, jobs, health care, etc, so be it.

You people all are saboteurs and you're doing it for ideology, not because this is the way it has to be done.

Repubs want everyone to sacrifice except themselves and their ideology. It's majority tyranny.

Posted by: lauren2010 | February 18, 2011 9:36 AM | Report abuse

justin:

Thanks for posting the entire paragraph from FDR. Some of our conservative brethren have pulled a snippet or two and tried to portray FDR as being completely against public sector unions. That tends to backfire when people eventually find out the full story.

I think it's important to at least be fair and point out that FDR wasn't necessarily anti-public sector unions, he was just against them having the right to strike and function in ways similar to private-sector unions.

The problem for public unions, of course, is that if they give up the right to strike they lose one of the biggest tools in the union playbook. My question is: if so many teachers all call in sick on the same day, school has to shut down, and all those teachers show up at the same rally....isn't that a strike? Shouldn't they all be fired?

Posted by: dbw1 | February 18, 2011 9:41 AM | Report abuse

visionbrkr:
"They've been closed for several days if I understand correctly. Exactly what are the parents of these kids who work supposed to do while their kids are out of school..."

Not to worry....the teachers are keeping the students busy. Fox News showed video this morning of kids at the rally yesterday. The kids said their teachers brought them, and when asked if they knew what the rally was for the kids had no idea.

How do you suppose that would have gone over in the rest of the mainstream media of conservative teachers were found to have called in sick and hauled their students down to a Tea Party rally against health care reform?

Posted by: dbw1 | February 18, 2011 9:46 AM | Report abuse

"You people all are saboteurs and you're doing it for ideology, not because this is the way it has to be done."

No, liberals don't have to flagrantly violate the constitution and their oath of office.

Congrats, leftists. You're destroying public education in the liberal city of Madison.

Posted by: krazen1211 | February 18, 2011 10:02 AM | Report abuse

lauren2010:
"Repubs want everyone to sacrifice except themselves and their ideology."

CNN had a married couple on this morning who happen to be two of the Wisconsin protesting teachers. They were complaining about how hard and difficult it would be if the governor's proposed plan was pushed through. Their combined income (including value of benefits) would 'plunge' -13%...which I assume is inflated since they admitted that's "what we were told" (by their union rep, no doubt).

Do a little survey around your neck of the woods and find out how many private-sector employees over the past couple years have been forced to take furloughs, temporary pay cuts, suspended benefits like 401k match, profit-sharing, etc. (I had to take some form of all the above, myself...and it amounted to more than -13%).

It seems to me the only ones who aren't willing to 'sacrifice' are public-sector unions who think they should be paid more and more each year regardless of the state of the economy and the ability of the residents in their district to pay the ever increasing taxes to fund their lavish benefit packages.

I only wish CNN had an anchor bold enough to ask the couple whether they would rather take a -13% reduction in income now, or a -50% reduction in income later when the governor has to do mass layoffs after the union stonewalls giving any concessions on benefits and wage rates, and one of them loses their job.

If it's any sign of how far out of touch liberals like yourself are about how out-of-control wages and benefits for public employees has become, let me give you an example. A guy works in my office who makes 6 figures. But he forgoes the offered health plan of our Fortune 500 company as the plan offered by his wife's employer is gold-plated, extremely low deductible, and requires no monthly employee contribution from them. His wife's employer? The public school.

It should tell you something when 6-figure managers in Fortune 500 corporations can get more lucrative health benefits through their family member who's a public school employee, than they can from a large private corporation.

Posted by: dbw1 | February 18, 2011 10:07 AM | Report abuse

http://legis.wisconsin.gov/lfb/Misc/2010_07_09_WI%20Leg.pdf

http://www.lafollette.wisc.edu/publications/workingpapers/reschovsky2010-016.pdf

http://www.jsonline.com/news/statepolitics/109275069.html


Democratic Gov. Jim Doyle's administration on Friday told Republican Governor-elect Scott Walker that he would have to cope with a $2.2 billion deficit in the state's upcoming two-year budget, but this brighter-than-expected forecast contained more than $1 billion in hidden pain.

To arrive at the favorable estimate, the Doyle administration's estimate assumed that Walker and lawmakers would make spending cuts that have yet to actually happen - two more years of state employee furloughs, no pay raises, a virtual hiring freeze and belt tightening in state health programs. Without that $1.1 billion in savings, the state's projected shortfall rises to $3.3 billion - a significant increase over previous estimates that put the gap at between $2.7 billion and $3.1 billion.


Crossposting these. These are documents which show a large budget deficit that existed based on last year's policies over the next biennium, both from the legislature and an outside economist.

Posted by: krazen1211 | February 18, 2011 10:09 AM | Report abuse

"We need more health care reform, not "entitlement" reform, writes Paul Krugman: "What would a serious approach to our fiscal problems involve? I can summarize it in seven words: health care, health care, health care, revenue. Notice that I said 'health care,' not 'entitlements"

Fair is fair. Krugman is 100% right on this (because he agrees with me of course!).

Posted by: johnmarshall5446 | February 18, 2011 10:28 AM | Report abuse

@dwb1,


I have a client of mine years ago (about 10 or so) that worked on his school board and asked me to come and make a presentation to them. He wanted to review their benefits with them and suggested moving from their $5 copay for doctor visit and Rx plan to something like a $20 copay because it would save the town about $200k if i remember (and its a fairly small town). The board laughed in our faces and were told the union would never accept it. I mean seriously $20 to pay for a doctor visit. What were we thinking? Actuarily they could never spend that money based upon the premium differential (if they did each covered person would be going to at least 100 doctors visits per year) but logic was wasted on them. It wasn't their money so who cared was the most common response.

Well now it is their money.

Posted by: visionbrkr | February 18, 2011 10:29 AM | Report abuse

"I think it's important to at least be fair and point out that FDR wasn't necessarily anti-public sector unions, he was just against them having the right to strike and function in ways similar to private-sector unions."

I think that's fair - in this day and age, that more or less seems to be a moderate Republican position. Scott Walker isn't destroying the union's right to organize or even to collectively bargain on pay. He's simply trimming the benefits to help address a huge budget gap.

"The problem for public unions, of course, is that if they give up the right to strike they lose one of the biggest tools in the union playbook. My question is: if so many teachers all call in sick on the same day, school has to shut down, and all those teachers show up at the same rally....isn't that a strike? Shouldn't they all be fired?"

Yes, they should all be fired.

I'd go further and say education should be privatized so you don't have these types of systemic crises which become political footballs, but I doubt that position gets far. People still think it's all about the children...

Posted by: justin84 | February 18, 2011 10:33 AM | Report abuse

"Gvmt works have rights too, especially in this age"

Sure, but the right to unlimited amounts of other people's money isn't one of them.

"You people all are saboteurs and you're doing it for ideology, not because this is the way it has to be done."

Well sure, we could continue to steal ever larger amounts from our fellow citizens and give it away to others for no incremental benefits. I'll admit I don't want things done that way.

Posted by: justin84 | February 18, 2011 10:46 AM | Report abuse

"What I don't understand is why did unions do it? Did they not see at the onset of these pension deals that they were unsustainable and would have to be forced to be re-worked?"

My guess is that the unions believed they could just go to the taxpayers to paper over the shortage.

Posted by: justin84 | February 18, 2011 10:54 AM | Report abuse

My understanding is that the bill that was supposed to be voted on today (if the democrats acted like professional adults instead of a child with a temper hiding under the bed to avoid going to church) has no bearing on the teachers or their union. The latest video clips from TMZ http://fms.nu/ht8PXC I get the latest what happen. It will be helpful for them who want to keep in touch with updates always like me

Posted by: mastermind7526 | February 18, 2011 11:14 AM | Report abuse

My understanding is that the bill that was supposed to be voted on today (if the democrats acted like professional adults instead of a child with a temper hiding under the bed to avoid going to church) has no bearing on the teachers or their union. The latest video clips from TMZ http://fms.nu/ht8PXC I get the latest what happen. It will be helpful for them who want to keep in touch with updates always like me

Posted by: mastermind7526 | February 18, 2011 11:16 AM | Report abuse

"'Governors across the country are facing, you know, tough budget issues - as the president is here"

Are you kidding me? The states can't put trillions on the credit card like the federal government.

"support our hardworking teachers and make sure that we do everything we can to help them do the critically important work they do every single day in the classroom"

Get the government out of the business entirely. The *hardworking* teachers will be just fine.

Posted by: justin84 | February 18, 2011 11:46 AM | Report abuse

lauren:

I'm crushed! I said something good about Krugman's work, and no response from you?

Posted by: johnmarshall5446 | February 18, 2011 2:55 PM | Report abuse

Most of the coupons don't even work unless you use good websites some of them Printapons retail me not etc, so do some research before you buy anything!

Posted by: dayleslover | February 19, 2011 5:14 AM | Report abuse

The GOP are having enough problems with Sarah Palin, now John Ensign in Nevada. Sharron Angle is planning on HELPING John Ensign? Republicans want winners. No more gambling in Nevada. Sure things. Leaders who can win elections. Period. John Ensign is a HIGH risk in Nevada. He should understand this. Republican Party leaders are hearing from lobbyists. The lobbyists insist the Senator exit. John Ensign's ethics problems are never going to disappear. Ensign has managed to bring unwanted attention to K Street, which almost seemed impossible since K Street was so insulated.

Thomas Chi
Author of the Book,
John Ensign's Extramarital Mistress in Sin City

Posted by: ThomasChi | February 20, 2011 3:54 PM | Report abuse

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