By Dan Froomkin
12:55 PM ET, 02/19/2009
President Obama's financial rescue proposal is still very hypothetical. His stimulus package is almost too big to comprehend, and it has yet to bear fruit. But his promise yesterday to help as many as nine million struggling homeowners had a real solidity to it, creating the most concrete sense yet that help is on the way to the people at the heart of this economic crisis.
Starting two weeks from now, a series of governmental sticks and carrots will encourage lenders to modify loan terms for as many as four million homeowners currently facing the prospect of foreclosure. And as many as five million homeowners who have little or even negative equity in their homes will be able to refinance their loans at low interest rates.
Barbara Kiviat writes for Time: "How effective all that will be is an unanswered question. No plan can change the fundamental economics of a bubble deflating or an economy stalling — of overpriced homes returning to more-reasonable prices and out-of-work homeowners not having the income to make mortgage payments. What this plan does offer, though, is a series of targeted interventions designed to help specific groups of borrowers, and by doing that to hopefully limit the knock-on damage caused by foreclosures, both to neighborhoods and the overall economy. 'This will help some people who deserve to be helped,' says Joe Gyrouko, a professor of real estate and finance at the University of Pennsylvania's Wharton School. 'But will this stop the decline in housing prices? No.'"
Sheryl Gay Stolberg and Edmund L. Andrews write in the New York Times: "The plan, which was more ambitious and expensive than many housing analysts had expected, drew praise from consumer advocates as well as the financial industry....
"Except for the provision that empowers bankruptcy judges, almost all the other elements can be enacted by Mr. Obama without further action by Congress."
Jenifer B. McKim writes in the Boston Globe: "Housing advocates praised the plan as ambitious, with cash incentives to lenders and borrowers to help stop the bleeding that has left nearly 10 percent of US homeowners either in foreclosure or behind on their mortgages. The plan, which uses federal money that was previously authorized, incorporates many proposals suggested over the past six months as the housing crisis has worsened."
Nobody, of course, is suggesting that it is perfect.
Laura Meckler writes in the Wall Street Journal: "The plan drew praise for its use of incentives. But critics said it didn't do enough to address the difficulty of altering loans packaged into securities. It also will be harder for people to refinance their mortgages if they owe much more than the house is worth or the mortgages aren't owned or guaranteed by Fannie Mae or Freddie Mac. That would leave out many borrowers in hard-hit states such as Florida, California and Arizona...
"Some economists were hopeful the Obama plan would subsidize an interest-rate reduction for borrowers. Instead, it appears designed to aid homeowners who might lose their homes."
Michael D. Fletcher and Renae Merle write in The Washington Post that the package "drew criticism from some housing experts and consumer advocates, who argued that it does not go far enough in addressing some critical aspects of the foreclosure crisis....
"While broad, the package does not tackle some key issues, critics said, noting that it does not include a plan for dealing with second mortgages, which often become a stumbling block for mortgage-modification programs. Others pointed out that for many lenders, the program would be voluntary."
Will this turn into just the latest political football? Quite possibly.
Stephanie Armour writes for USA Today: "On Capitol Hill, some Republicans — amplifying criticisms by homeowners who didn't buy more expensive houses than they could afford and have paid their mortgages on time — challenged the fairness of an expensive bailout.
"House Republican Leader John Boehner, R-Ohio, and Republican Whip Eric Cantor, R-Va., sent the president a letter asking, 'What will your plan do for the over 90% of homeowners who are playing and paying by the rules?'"
Mike Madden writes for Salon that Democrats yesterday "noted pointedly that the Bush administration could have done the exact same thing under the authority Congress gave it during the financial crisis last fall, and didn't. 'This is light-years ahead of anything we saw coming out of the Bush administration,' said Andrew Jakabovics, a housing analyst at the Center for American Progress, a liberal think tank. Obama hit the same theme, a little less directly. 'Our housing crisis was born of eroding home values, but it was also [born] of the erosion of our common values,' he said. 'And in some cases, common sense.'"
The New York Times editorial board writes: "The anti-foreclosure plan announced by President Obama on Wednesday is a decisive break from the Bush administration’s disastrous protect-the-banks-but-not-the-homeowners policy. The president has promised that it will help as many as nine million American families refinance their mortgages or avoid foreclosure. That’s a good start, but given the dire state of the economy, we fear it still may not be enough."
The Washington Post editorial board writes: "Mr. Obama has negotiated the trade-offs cautiously. His plan offers more relief than previous programs, and targets it. Cutting some homeowners' borrowing costs could help them stay in their homes as long as they still have work. The plan pushes back against the recessionary tide. But that tide is still rising."
The Wall Street Journal editorial board writes that "by investing in failure, the Administration will...prolong the housing downturn and make financing a home purchase more difficult for future borrowers. Meanwhile, the plan isn't likely to slow the continuing decline in housing prices."Obama North of the Border
By Dan Froomkin
12:49 PM ET, 02/19/2009
President Obama is spending seven hours in Canada today, making his first international visit to our neighbor to the north.
Gone -- amid the donning of his executive authority and the convulsions of a global financial crisis -- is some of his tough talk from the campaign about renegotiating parts of NAFTA.
Ross Colvin and Jeff Mason write for Reuters: "Obama will seek to quell Canadian concerns about U.S. protectionism when he makes his first foreign trip as president on Thursday to the United States' biggest trading partner and energy supplier...
"Trade will dominate the discussions, and Harper has said he will seek assurances that the 'Buy American' clause in the $787 billion U.S. economic recovery package signed by Obama this week will not discriminate against firms in Canada, which sends about 75 percent of its exports to the United States.
"U.S. officials, in turn, have said Obama will seek to allay those fears. The president said in an interview with the Canadian Broadcasting Corporation this week that Canadians should not be concerned, noting that history showed that 'beggar thy neighbor' protectionist policies could backfire....
"Canada is also alarmed by Obama's stated desire to renegotiate the North American Free Trade Agreement, to which Canada, the United States and Mexico are signatories, fearing that it could lead to new tariff barriers. Obama has said he wants to strengthen environmental and labor provisions.
"U.S. administration officials this week sought to downplay the issue, saying that while Obama would raise it in his talks with Harper, the fragile state of the world economy meant he would not be pushing hard for NAFTA to be re-examined now."
Chris Cillizza blogs for The Washington Post with this flashback: "In the runup to the Ohio primary on March 5, 2008, Obama was asked at a debate in Cleveland about his position on NAFTA. 'We should use the hammer of a potential opt-out as leverage to ensure that we actually get labor and environmental standards that are enforced,' he said at the time."
Michael D. Shear writes in The Washington Post that the environment will also be a major topic: "Environmental groups are pushing Obama to seek restrictions on tar sands oil, a dirtier form of oil that contributes about half of the oil imported into the United States from Canada."
And David Jackson writes for USA Today that Obama has "plans to discuss the two nations' roles in curbing the worsening fighting in Afghanistan....
"Canada has 2,830 troops in Afghanistan and has lost 108 in the war that started in October 2001. Obama said he wants Canadian help with a new approach to the war that includes more diplomacy and economic assistance."Outside the Echo Chamber
By Dan Froomkin
12:39 PM ET, 02/19/2009
I'm hearing an increasingly common refrain these days: That Washington's media and political elite just don't get it. See, for instance, my recent posts: Washington vs. the Rest of America and Obama: I Won't Play Washington Games.
Along those lines, Washington Post opinion columnist David Ignatius takes on his fellow members of the Washington media establishment this morning: "Media coverage of the $787 billion stimulus package signed Tuesday by President Obama has had an air of unreality -- as if people were reporting on a baseball game or a tennis match. Is Obama up or down today? Did the Republicans gain or lose momentum? Meanwhile, as Washington obsesses over the political box score, the economy has been going down the toilet.
"You get a better sense of what the crisis feels like -- and the real impact of the stimulus package -- when you leave the miasma of federal spending and examine state and local governments. Here, the impact of the downturn is severe and immediate...
"Did President Obama have a good day Tuesday when he signed the stimulus bill? You bet he did. But the point that weirdly seems to get relatively little attention is that it was a good day for millions of Americans who are getting hammered by the recession."
And Greg Sargent blogs at whorunsgov.com: "At a private White House cocktail reception last night for leaders of major progressive groups, Barack Obama and his wife Michelle appealed to these leaders and signaled that their groups would play a key role in driving the big progressive changes at the heart of the White House’s legislative agenda, an attendee tells me.
"The message was that these groups would be valuable as a kind of progressive outside 'echo chamber,' as the attendee puts it."Afghanistan Watch
By Dan Froomkin
12:37 PM ET, 02/19/2009
I wrote at length yesterday about Obama's decision to send more troops to Afghanistan. If you missed it, read it now: Putting Out Fire -- With Gasoline?
Elisabeth Bumiller writes in the New York Times: "The top American commander in Afghanistan, Gen. David D. McKiernan, said Wednesday that the heightened troop levels that President Obama ordered for Afghanistan could remain in place for as long as five years.
"General McKiernan, who spoke at a news conference at the Pentagon a day after Mr. Obama ordered 17,000 additional troops to the country, said that the buildup 'is not a temporary force uplift' and that it was essential to break what he called a stalemate in southern Afghanistan, the epicenter of the Taliban-led insurgency."
Ellen Barry writes in the New York Times: "The Parliament of Kyrgyzstan voted on Thursday to terminate the American military’s eight-year lease on an air base outside the capital, Bishkek, complicating President Obama’s plans to deploy as many as 30,000 additional troops to Afghanistan over the next two years."
Fred Kaplan writes for Slate that "whatever Obama eventually does about this war, he pretty much had to send those two brigades now—a move recommended by all his civilian and military advisers—unless, of course, he'd decided just to get out of Afghanistan altogether. But he wasn't going to do that. He has said many times, during the election campaign and since, that as U.S. troops pulled out of Iraq, he would send at least some of them to Afghanistan. And the two brigades that he's sending there now—one Army, one Marine—were originally scheduled to rotate back into Iraq."
And, he concludes: "Whatever President Obama decides to do in Afghanistan, the real danger lies in Pakistan, and its problems lie beyond the powers and jurisdiction of the U.S. military or NATO."Shoe Watch
By Dan Froomkin
12:35 PM ET, 02/19/2009
Liz Sly writes for the Chicago Tribune: "The Iraqi journalist who threw his shoes at former President George W. Bush made an impassioned courtroom appeal for clemency on the first day of his trial today, saying he became enraged when he saw Bush smiling and joking with Iraq's prime minister.
"Muntadher al-Zaidi, 30, was hailed as a hero throughout the Arab world for his shoe-throwing protest last Dec. 14, during Bush's visit to Baghdad....
"'While he was talking I was looking at all his achievements in my mind. More than a million killed, the destruction and humiliation of mosques, violations against Iraqi women, attacking Iraqis every day and every hour,' he said.
"'A whole people are saddened because of his policy, and he was talking with a smile on his faceand [sic] he was joking with the prime minister and saying he was going to have dinner with him after the press conference.
"'Believe me, I didn't see anything around me except Bush,' Zaidi continued. 'I was blind to anything else. I felt the blood of the innocent people bleeding from beneath his feet and he was smiling in that way. And then he was going to have a dinner, after he destroyed one million martyrs, after he destroyed the country.
"'So I reacted to this feeling by throwing my shoes. I couldn't stop the reaction inside me. It was spontaneous.'"Quick Takes
By Dan Froomkin
12:29 PM ET, 02/19/2009
House Speaker Nancy Pelosi tells Tim Dickinson of Rolling Stone that she supports the formation of a commission to investigate Bush administration misdeeds and can even foresee a scenario in which senior members of the Bush administration are prosecuted. "I think so," Pelosi says. "The American people deserve answers."
Karl Rove writes in his Wall Street Journal opinion column that Team Obama's "fast start can't overcome a growing sense the administration is winging it on issues large and small."
David S. Broder writes in his Washington Post opinion column that the stimulus bill was "a success for bipartisanship, not a failure." And he concludes that for Obama to end his efforts at bipartisanship "out of frustration with what happened on the stimulus bill would be insane. If the political wise guys can't see that, let's hope the president can."
Margaret Carlson writes in her Bloomberg opinion column, "Yes, we want policy-making to be civil. When possible, we want it to be consensual. Yet bipartisanship as an overriding goal allows the policies chosen by voters to be thwarted by mere obstructionists. So now, gerrymandered House Republicans with nothing to worry about but a primary from the right can thumb their nose not only at a president but at the voters who rejected them. Obama wants the economy to revive and the Republicans to be agreeable. Perhaps he should shoot for one miracle at a time."
Joan Walsh writes in Salon that the worrisome revelations about the way the Obama administration may continue Bush policies on detaining and treating terror suspects described by Charlie Savage in the New York Times yesterday remain "in the realm of maybe."
Krissah Thompson blogs for The Washington Post: "As President Obama has traveled the country talking up his plans to boost the economy, he's also made a point of reaching out to two constituencies that rallied behind his candidacy, calling in to radio programs popular with Latinos and African Americans." Obama spoke with Warren Ballentine yesterday, and he called the widely syndicated Spanish-language program "Piolin por la Manana" on Tuesday. Here's the transcript of the Piolin interview.
Archbishop Desmond Tutu, in an article for BBC News, warns Obama of the risk of squandering the goodwill his election has generated. "It would be wonderful if, on behalf of the nation, Obama apologises to the world, and especially the Iraqis, for an invasion that I believe has turned out to be an unmitigated disaster," Tutu writes.
Potentially putting to rest at least one conservative conspiracy theory, FoxNews.com reports, "President Obama opposes any move to bring back the so-called Fairness Doctrine, a spokesman told FOXNews.com Wednesday."
Jeff Zeleny writes in the New York Times: "A trend is emerging in President Obama’s out-of-the-gate travel itinerary: Top billing has been given to states that turned from red to blue in the fall."Bigger Than Jesus?
By Dan Froomkin
9:45 AM ET, 02/19/2009
Harris Interactive reports: "When The Harris Poll asked a cross-section of adult Americans to say whom they admire enough to call their heroes, President Barack Obama was mentioned most often, followed by Jesus Christ and Martin Luther King....
"These heroes were named spontaneously. Those surveyed were not shown or read a list of people to choose from. The Harris Poll was conducted online among a sample of 2,634 U.S. adults (aged 18 and over) by Harris Interactive between January 12 and 19, 2009....
"This question was first asked in a Harris Poll in 2001. In that survey Jesus Christ was the hero mentioned most often, followed by Martin Luther King, Colin Powell, John F. Kennedy and Mother Teresa."
But lest you think that Obama is -- as John Lennon so famously once said of the Beatles -- more popular than Jesus, the folks at Harris point out: "The fact that President Obama is mentioned more often than Jesus Christ should not be misinterpreted. No list was used and nobody was asked to choose between them."
Poll respondents gave many reasons to explain their choice of heroes. Among them: "Doing what's right regardless of personal consequences" (89%); "Not giving up until the goal is accomplished" (83%); "Doing more than what other people expect of them" (82%); "Overcoming adversity" (81%); and "Staying level-headed in a crisis" (81%).Froomkin in Second Life
By Dan Froomkin
9:23 AM ET, 02/19/2009
Hey, who's that over there? It's me. Well, virtual me.
That's my Second Life avatar, created for me by the fine folks at Virtually Speaking.
Second Life is a free 3D virtual world where all sorts of interesting things go on -- including, apparently, public affairs talk shows. And I'll be the guest on one tonight at 9 p.m. ET.
Join me either in Second Life at the Virtually Speaking Studio, or -- if you're not a Second Lifer -- you can still listen in on BlogTalk Radio. And you can call in from the "real" world, at 646.200.3440.Cartoon Watch
By Dan Froomkin
9:18 AM ET, 02/19/2009
Stuart Carlson on Obama's bipartisan overtures, Ann Telnaes, John Sherffius and John Branch on the GOP, Joel Pett on where Obama draws the line, Tom Toles on filling Obama's shoes and Jim Morin on the Burris sideshow.