Monday, July 23, 2012

Reforming Wall Street, Protecting Main Street: An Update on Wall 

Street Reform

By: Anthony Reyes

​​Two years ago this week, President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act -- the most significant set of financial reforms since the Great Depression. The landmark law is designed to help protect Americans from the excessive risk, fragmented oversight, and poor consumer protections that played leading roles in bringing about the recent financial crisis.

Treasury and the independent regulators have made meaningful progress implementing the law, which is vital to restoring trust in the underlying safety, stability, and integrity of the financial system, and to rebuilding a pro-growth, pro-investment environment.  To outline the progress made, the U.S. Department of the Treasury has developed an overview of where reform stands and the changes it has effected on the financial system to date. For a copy of the overview, please click here​​. (Updated 7/19/2012)

This week, the President attended the Team USA basketball game, hosted the Baylor University Lady Bears basketball team, and proposed a STEM Master Teacher Corps, while the First Lady traveled to Philadelphia for 'Let's Move!' and to Birmingham to get an update on recovery efforts in the region from last year's violent storms. Also, the Vice President spoke to seniors about retirement security, and the administration hosted a Google+ hangout on local foods.
Adam Garber
July 20, 2012 
12:00 AM EDT

President Barack Obama pauses for a moment of silence for the victims of the Colorado shootings (July 20, 2012)
President Barack Obama pauses for a moment of silence for the victims of the Colorado shootings, following his remarks in Fort Myers, Fla., July 20, 2012. (Official White House Photo by Pete Souza)
Just after midnight, a gunman walked into a busy movie theater in Aurora, Colorado and opened fire into the crowd. Police report that 12 people have been killed and dozens more are currently being treated for injuries.
Just moments ago, President Obama discussed the shooting, calling on the country to stand with those who have been touched by the tragedy:
[Even] as we learn how this happened and who's responsible, we may never understand what leads anybody to terrorize their fellow human beings like this. Such violence, such evil is senseless. It's beyond reason. But while we will never know fully what causes somebody to take the life of another, we do know what makes life worth living.  The people we lost in Aurora loved and they were loved. They were mothers and fathers; they were husbands and wives; sisters and brothers; sons and daughters, friends and neighbors. They had hopes for the future and they had dreams that were not yet fulfilled. 
Earlier, the President spoke with both the mayor of Aurora, Steve Hogan, and Colorado Governor John Hickenlooper -- and pledged the full support of federal law enforcement to aid the investigation.
To read President Obama's full remarks, click here. To read a statement from the President, click here.
Vice President Joe Biden has also issued a statement.
Update: President Obama has issued a proclamation that the flag of the United States be flown at half-staff at the White House and at all public buildings and grounds until sunset on July 25.

President Barack Obama hugs Stephanie Davies (July 22, 2012)
President Barack Obama hugs Stephanie Davies, who helped keep her friend, Allie Young, left, alive after she was shot during the movie theater shootings in Aurora, Colorado. The President visited patients and family members affected by the shootings at the University of Colorado Hospital July 22, 2012. (Official White House Photo by Pete Souza)
On Sunday, President Obama traveled to Aurora, Colorado to meet with the survivors of the movie theater shooting and offer solace to families of the victims. 
"I had a chance to visit with each family, and most of the conversation was filled with memory," the President said. "I confessed to them that words are always inadequate in these kinds of situations, but that my main task was to serve as a representative of the entire country and let them know that we are thinking about them at this moment and will continue to think about them each and every day."
During his visit to University of Colorado Hospital, the President had a chance to meet Allie Young and Stephanie Davies, and speaking to reporters, he described their story.
During the film, Allie and Stephanie were seated near an aisle and when the gunman began his attack by tossing a canister of gas into the crowd, Allie, just 19 years old, stood up to warn those around her. She was hit in the neck by a bullet, which punctured a vein.
Stephanie, the President said, dropped to the ground beside her friend, applied pressure to Allie's wound to slow the bleeding, then dialed 911 with her cell phone. Even after Allie told Stephanie to run, the 21 year old stayed by her friend -- and when first responders arrived, Stephanie helped to carry Allie to a waiting ambulance.
Doctors expect Allie to make a full recovery.
President Barack Obama makes a statement to the press at University of Colorado Hospital in Aurora (July 22, 2012)
President Barack Obama makes a statement to the press at University of Colorado Hospital in Aurora, Colo., July, 22, 2012, following his meetings with families of victims killed in last Thursday's shootings. Standing with the President, from left, are: Rep. Ed Perlmutter, D-Colo., Police Chief Dan Oates, Sen. Mark Udall, D-Colo., Colorado Gov. John Hickenlooper, Sen. Michael Bennet, D-Colo. (Official White House Photo by Lawrence Jackson)
"I don't know how many people at any age would have the presence of mind that Stephanie did, or the courage that Allie showed," President Obama said.  "And so, as tragic as the circumstances of what we've seen today are, as heartbreaking as it is for the families, it's worth us spending most of our time reflecting on young Americans like Allie and Stephanie, because they represent what's best in us, and they assure us that out of this darkness a brighter day is going to come."
Read his full remarks here.
6-year-old girl, sailor, aspiring broadcaster among Colorado shooting victims Pge2

Alexander Jonathan Boik, 18
Boik, known as AJ, graduated earlier this year from Gateway High School in Aurora, his family said in a statement. He was accepted to Rocky Mountain College of Art and Design and planned to be an art teacher and open his own studio.He attended the movie with his girlfriend, who survived the attack, the family said. She was not identified.A friend, Jordan Crofter, described Boik as someone who "didn't hold anything back. He was just his own person.""He was a ball of joy. He was never sad or depressed. He wanted everybody to be happy," Crofter told The Associated Press.

Jesse Childress, 29
Former soldier and Air Force Reservist Jesse Childress was the kind of guy who would do anything for anybody.
“My brother’s wheelchair broke,” said one long-time neighbor in Lake Los Angeles, Calif., where Childress grew up. “He (Jesse) fixed it and didn’t charge him a dime.”
Childress, a staff sergeant on active duty at Buckley Air Force Base in Aurora, where he served as a cyber-system operator, was at the midnight showing with fellow reservist Munirih Gravelly when James Holmes allegedly set off a can of tear gas before opening fire in the jam-packed theater.
"As soon as that little gas can exploded, I said, 'This is wrong,'” Gravelly told NBC LA. She dove to the floor and was wounded by buckshot but kept her face down.
"He was a fun-loving individual," his colleague Sgt. Alejandro Sanchez told the Associated Press. "If you needed help, no matter the time of day he would stay late. He would come in early to help out the unit in any way he can, even if it meant long hours."
"I feel really sorry that he's gone,” she said. “None of us noticed until the lights, until it was over, that he was gone. None of us were there to hold his hand, look him in the eye while he passed. ... I lost a friend."

Alex Teves, 24
Teves was a 2006 graduate of Desert Vista High School in the Tempe (Ariz.) Unified School District, NBC station KPNX of Phoenix reported.
University of Denver released a statement saying Teves graduated from the Morgridge College of Education recently, and identified his home town as Phoenix.

Rebecca Ann Wingo, 32
An Aurora resident originally from Quinlan, Texas, Wingo was a mother of two daughters, her friends said in social media postings. She was a waitress at Joe’s Crab Shack and was a student at the Community College of Aurora, the Denver Post reported.
“I lost my daughter yesterday to a mad man," Steve Hernandez wrote on his daughter’s Facebook page, the Post reported. "My grief right now is inconsolable. I hear she died instantly, without pain, however the pain is unbearable."

Gordon W. Cowden, 51
Cowden was the oldest victim identified by the Arapahoe County coroner’s office.
Cowden grew up in Austin, Texas, and is the father of four children, his friend Jane Gibson told NBC News. “I had texted him yesterday to see how he was (after hearing of the shooting), I never heard back from him.”  His parents and siblings live in Texas, she said.
"A quick witted world traveler with a keen sense of humor, he will be remembered for his devotion to his children and for always trying his best to do the right thing, no matter the obstacle," his family said.

NBC News' Miranda Leitsinger, Alex Johnson, Jim Gold, Elizabeth Chuck, Jim Miklaszewski and Courtney Kube, MSNBC's Dax Tejera, Beverly White and John Simerson of NBC Los Angeles and The Associated Press contributed to this report.

Visit for breaking news, world news, and news about the economy

NBC's Kate Snow talks with a member of the University of Colorado medical staff who treated dozens of patients following Friday's Aurora movie theater massacre.

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6-year-old girl, sailor, aspiring broadcaster among Colorado shooting victims

Visit for breaking news, world news, and news about the economy
 Among the 12 who died early Friday at a movie theater in Aurora, Colo. were fathers, mothers, a little girl – even heroes. NBC's Kristen Dahlgren reports.
Updated July 23, 10:45 a.m. EDT: An aspiring sportscaster. A 6-year-old girl. A man celebrating his 27th birthday. College students who moved to Colorado to blaze paths for their futures.

The names and lives of the victims killed in a horrific mass shooting at a Denver-area movie theater emerged Saturday as families and friends learned the fates of their loved ones.
The Arapahoe County coroner released the identities of the dozen victims who were killed in the attack at a midnight premiere of "Batman: The Dark Knight Rises" early Friday in Aurora, Colo.
“The cause of death in all cases is related to gunshot wounds,” said the coroner, Dr. Michael Doberson. The  manner of death is homicide.”
Officials said 58 other people were injured in the rampage. On Saturday night, 26 remained hospitalized, nine in critical condition.
James Eagan Holmes, 24, a graduate student at the University of Colorado-Denver, was arrested outside the theater, clad in black body armor and armed with three weapons.Survivors of the midnight screening shootings were allowed to return to the theater Saturday to retrieve their automobiles, which were left behind during the evacuation and subsequent investigation. Some of them left flowers and flags as tributes to the ead.

Jeremy Papasso / Reuters
Myia Young, 4, places a candle by an American flag during a vigil for victims behind a theater where a gunman opened fire at moviegoers in Aurora, Colo., Friday. Twelve people, including a 6-year-old girl, were killed.

The youngest victim to die in the shooting rampage was Veronica Moser-Sullivan, 6, her great-aunt, Annie Dalton, told NBC News.
Veronica's mother, Ashley Moser, 25, was shot in the throat and the abdomen. She remained paralyzed in critical condition and hadn’t been told of her daughter's death, Dalton said.
"This is just a nightmare right now," Dalton said. "It's a nightmare. "Everything's surreal. It's just surreal."
Residents of Aurora gathered late Sunday and vowed to remember the victims. President Barack Obama visited with survivors and family members of victims.
Here are profiles of others confirmed dead:

Jessica Ghawi, 24
A hockey blogger and aspiring sportscaster, Ghawi had recently moved to Denver from San Antonio to pursue her dream and was working as an intern at a Denver sports radio station.
“One of the things that she had been working on with all the fires in Colorado was she had asked everybody to donate sports equipment for  people because she knows how sports brings such joy,” her friend Mike  Lavender told MSNBC-TV.
Ghawi had escaped a shooting at a mall in Toronto in June, writing in her blog that an “odd feeling” compelled her to leave the shopping center minutes before a shooting that left two people dead.
Before the movie she had exchanged excited tweets with her friends about the midnight showing from her Twitter handle, @JessicaRedfield.
"Of course we're seeing Dark Knight. Redheaded Texan spitfire, people should never argue with me. Maybe I should get in on those NHL talks…”

Alex Sullivan, 27
Sullivan had planned to celebrate his 27th birthday Friday, beginning with the midnight showing of the new Batman movie.
Alex Sullivan
"Oh man one hour till the movie and its going to be the best BIRTHDAY ever," he tweeted before heading to the theater where a black-clad gunman wearing body armor opened fire, killing 12 people and injuring 58.That was the last his friends and family heard from him.
Heartbreaking photos showed his father, Tom Sullivan, in the nearby Gateway High School parking lot, waving a picture of his son and yelling, "Find my son!"
Late Friday, the family got confirmation of his death.

Jonathan Blunk, 26
Blunk always wanted to be a hero, according to his friends and family.
“He always talked about if he were going to die, he wanted to die a hero,” his estranged wife, Chantel Blunk, told NBC News from Reno, Nev.
Blunk attended the movie with a friend, Jansen Young, who credited him with saving her life.
When the shooting broke out, Young said Blunk, a military veteran, threw her to the ground and told her to stay down.
"Jon just took a bullet for me," Young told TODAY.
Chantel Blunk said her husband graduated from Reno’s Procter Hug High School in 2004 and enlisted in the Navy, serving out of San Diego aboard the USS Nimitz. The couple, who met in high school, married in 2007.
He left the service in 2009 and after separating from his wife moved to Colorado, where he worked for a hardware store. After a franctic day of trying to get information about her husband’s fate, Chantel said FBI agents arrived at her home Friday evening and confirmed her worst fears.
In addition to his wife, Blunk leaves behind two young children, a girl, 4, and a boy, 2.
Chantel said she plans to bring the body home to Reno, where he will be buried with military honors. She has set up an account through Wells Fargo to raise money for the funeral and transportation costs.

John Larimer, 27
Petty Officer Third Class John Larimer, of Crystal Lake, Ill., attended the opening with another sailor, who was injured in the attack.
"I am incredibly saddened by the loss of Petty Officer John Larimer — he was an outstanding shipmate, "said Cmdr. Jeffrey Jakuboski, Larimer's commanding officer. "A valued member of our Navy team, he will be missed by all who knew him. My heart goes out to John's family,  friends and loved ones, as well as to all victims of this horrible tragedy."
Larimer, a cryptologic technician, joined the Navy in June 2011 and had been stationed at Buckley Air Force Base in Aurora since October.
His family said they were making arrangments to bring the remains back to Illinois.
"We respectfully ask that the family and friends of John be allowed time and privacy to grieve for John and we send our thoughts and prayers out to the families of the other victims and those still recovering in the hospital," the family said in a statement. "We love you John and we will miss you always."

Matt McQuinn, 27
McQuinn, originally from Springfield, Ohio, went to the premiere with his girlfriend, Samantha Yowler, who was injured in the attack, according to family members.
McQuinn was a graduate of Butler-Vandalia High School in Ohio. He and Yowler, from St. Paris, Ohio, moved in November to Colorado, where Yowler’s brother, Nick, lives.
All three were in the theater when the shooting erupted.
McQuinn and Nick Yowler dove on top of Samantha Yowler to shield her from bullets, family attorney Rob Scott told NBC station WLWT of Cincinnati.
Yowler was shot in the knee and is recovering after surgery, Scott said. Nick McQuinn was not hurt, he said.

Micayla Medek, 23
Medek was among the dead, her father's cousin, Anita Busch, told The Associated Press.
Busch said the news, while heartbreaking, was a relief for the family after an agonizing day of waiting for news.
"I hope this evil act ... doesn't shake people's faith in God," she said.
Medek worked at Subway and had taken classes at Community College of Aurora, the Denver Post reported. She was a graduate of William C. Hinkley High School in Aurora.

Where Obama Shines

It won’t help him win many votes this year, but it should be noted that Barack Obama has been a good foreign policy president. He, Vice President Joseph Biden, Secretary of State Hillary Clinton and the rest of his team have created a style of policy making that is flexible, incremental and well adapted to the specific circumstances of this moment. Following a foreign policy hedgehog, Obama’s been a pretty effective fox.

Josh Haner/The New York Times
David Brooks
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Some eras call for bold doctrines, new global architecture and “Present at the Creation” moments. This is not one of those eras. Today, the world is like a cocktail party at which everybody is suffering from indigestion or some other internal ailment. People are interacting with each other, but they’re mostly focused on the godawful stuff going on inside. Europe has the euro mess. The Middle East has the Arab Spring. The U.S. has the economic stagnation and the debt. The Chinese have their perpetual growth and stability issues.
It’s not multi-polarity; it’s multi-problemarity. As a result, this is more of an age of anxiety than of straight-up conflict. Leaders are looking around warily at who might make their problems better and who might make them worse. There are fewer close alliances and fewer sworn enemies. There are more circumstances in which nations are ambiguously attached.
In this environment, you don’t need big, bold visionaries. You need leaders who will pay minute attention to the unique details and fleeting properties of each region’s specific circumstances. You need people who can improvise, shift and play it by ear. Obama, Clinton and the rest are well suited to these sorts of tasks.
Obama has shown a good ability to combine a realist, power-politics mind-set with a warm appreciation of democracy and human rights. Early in his term, he responded poorly to the street marches in Tehran. But his administration has embraced a freedom agenda more aggressively since then, responding fairly well to the Arab Spring, rejecting those who wanted to stand by the collapsing dictatorships and using American power in a mostly successful humanitarian intervention in Libya.
Obama has also shown an impressive ability to learn along the way. He came into office trying to dialogue with dictators in Iran and North Korea. When that didn’t work, he learned his lesson and has been much more confrontational since. Early in his term, he tried nation-building in Afghanistan. When that, unfortunately, didn’t work, he scaled back that effort.
Obama has managed ambiguity well. This is most important in the case of China. When the Chinese military was overly aggressive, he stood up to China and reasserted America’s permanent presence in the Pacific. At the same time, it’s misleading to say there is a single China policy. There are myriad China policies on myriad fronts, some of which are confrontational and some of which are collaborative.
Obama has also dealt with uncertainty pretty well. No one knows what will happen if Israel or the U.S. strikes Iran’s nuclear facilities. Confronted with that shroud of ignorance, Obama has properly pushed back the moment of decision-making for as long as possible, just in case anything positive turns up. This has meant performing a delicate dance — pressing Israelis to push back their timetable while, at the same time, embracing their goals. The period of delay may be ending, but it’s been useful so far.
Obama has also managed the tension between multilateral and unilateral action. No one can say he is hesitant to work with coalitions. Look at the Libyan action, or the Iranian sanctions. But when it comes to decimating Al Qaeda, the U.S. has been quite willing to go it alone, continuing and expanding many policies of George W. Bush.
There have been failures on Obama’s watch, of course. Some of these flow from executive hubris. Obama believed that he could help resolve the Israeli-Palestinian dispute. He proceeded clumsily, pushed everybody into a corner and now peace is farther away than ever.
Some failures flow from excessive politicization. An inexcusable blunder by Obama was to announce the withdrawal date from Afghanistan at the same time he announced the surge into Afghanistan. That may have kept the Democratic base happy, but it sent thousands of soldiers and Marines on a mission that was doomed to fail.
Over all, though, the record is impressive. Obama has moved more aggressively both to defeat enemies and to champion democracy. He has demonstrated that talk of American decline is hooey. The U.S. is still responsible for maintaining global order, for keeping people, goods and ideas moving freely.
And, partly as a result of his efforts, the world of foreign affairs is relatively uncontentious right now. Foreign policy is not a hot campaign issue. Mitt Romney is having a great deal of trouble identifying profound disagreements. If that’s not a sign of success, I don’t know what is.        

Pathos of the Plutocrat

“Let me tell you about the very rich. They are different from you and me.” So wrote F. Scott Fitzgerald — and he didn’t just mean that they have more money. What he meant instead, at least in part, was that many of the very rich expect a level of deference that the rest of us never experience and are deeply distressed when they don’t get the special treatment they consider their birthright; their wealth “makes them soft where we are hard.”
Fred R. Conrad/The New York Times
Paul Krugman
Related in Opinion
And because money talks, this softness — call it the pathos of the plutocrats — has become a major factor in America’s political life.
It’s no secret that, at this point, many of America’s richest men — including some former Obama supporters — hate, just hate, President Obama. Why? Well, according to them, it’s because he “demonizes” business — or as Mitt Romney put it earlier this week, he “attacks success.” Listening to them, you’d think that the president was the second coming of Huey Long, preaching class hatred and the need to soak the rich.
Needless to say, this is crazy. In fact, Mr. Obama always bends over backward to declare his support for free enterprise and his belief that getting rich is perfectly fine. All that he has done is to suggest that sometimes businesses behave badly, and that this is one reason we need things like financial regulation. No matter: even this hint that sometimes the rich aren’t completely praiseworthy has been enough to drive plutocrats wild. For two years or more, Wall Street in particular has been crying: “Ma! He’s looking at me funny!”
Wait, there’s more. Not only do many of the superrich feel deeply aggrieved at the notion that anyone in their class might face criticism, they also insist that their perception that Mr. Obama doesn’t like them is at the root of our economic problems. Businesses aren’t investing, they say, because business leaders don’t feel valued. Mr. Romney repeated this line, too, arguing that because the president attacks success “we have less success.”
This, too, is crazy (and it’s disturbing that Mr. Romney appears to share this delusional view about what ails our economy). There’s no mystery about the reasons the economic recovery has been so weak. Housing is still depressed in the aftermath of a huge bubble, and consumer demand is being held back by the high levels of household debt that are the legacy of that bubble. Business investment has actually held up fairly well given this weakness in demand. Why should businesses invest more when they don’t have enough customers to make full use of the capacity they already have?
But never mind. Because the rich are different from you and me, many of them are incredibly self-centered. They don’t even see how funny it is — how ridiculous they look — when they attribute the weakness of a $15 trillion economy to their own hurt feelings. After all, who’s going to tell them? They’re safely ensconced in a bubble of deference and flattery.
Unless, that is, they run for public office.
Like everyone else following the news, I’ve been awe-struck by the way questions about Mr. Romney’s career at Bain Capital, the private-equity firm he founded, and his refusal to release tax returns have so obviously caught the Romney campaign off guard. Shouldn’t a very wealthy man running for president — and running specifically on the premise that his business success makes him qualified for office — have expected the nature of that success to become an issue? Shouldn’t it have been obvious that refusing to release tax returns from before 2010 would raise all kinds of suspicions?
By the way, while we don’t know what Mr. Romney is hiding in earlier returns, the fact that he is still stonewalling despite calls by Republicans as well as Democrats to come clean suggests that it could be something seriously damaging.
Anyway, what’s now apparent is that the campaign was completely unprepared for the obvious questions, and it has reacted to the Obama campaign’s decision to ask those questions with a hysteria that surely must be coming from the top. Clearly, Mr. Romney believed that he could run for president while remaining safe inside the plutocratic bubble and is both shocked and angry at the discovery that the rules that apply to others also apply to people like him. Fitzgerald again, about the very rich: “They think, deep down, that they are better than we are.”
O.K., let’s take a deep breath. The truth is that many, and probably most, of the very rich don’t fit Fitzgerald’s description. There are plenty of very rich Americans who have a sense of perspective, who take pride in their achievements without believing that their success entitles them to live by different rules.
But Mitt Romney, it seems, isn’t one of those people. And that discovery may be an even bigger issue than whatever is hidden in those tax returns he won’t release.        

Drought threatens to darken Obama reelection prospects

With nearly two-thirds of the US enduring drought conditions, food prices are expected to jump ahead of the November election. That could add to voter anxieties about the economy.

By Patrik Jonsson, Staff writer / July 13, 2012
A drought stricken corn field is seen in DeWitt, Iowa, Thursday. Drought in the Midwest worsened over the past week, with a third of the nine-state region in severe to exceptional drought in the week ended July 10, the Drought Monitor said.
Adrees Latif/Reuters
A massive drought parching some of America’s most productive farm regions is pushing food prices up to the point where wilting corn plants could influence the presidential election.
More than 1,000 US counties – many of them in the grain capitals of the Midwest – have applied for federal disaster relief, meaning they’ve had drought conditions for more than eight weeks. Moreover, 61 percent of the US is now considered drought-stricken, the highest percentage in the 12-year history of the US Drought Monitor. 
Drought or no drought, the US will still produce about a third of the world’s corn and will see its third-largest corn crop ever. Moreover, a drought prognosis by Iowa State University agri-economist Chad Hart suggests that parts of the country – including Georgia and portions of Texas – are likely to see relief as the summer progresses, even as some part of the Midwest may see dry conditions worsen.
But if wilting plants result in yield below what was expected in the futures markets, prices will rise further. Already, prices have risen by about 30 percent, meaning consumers could see short-term price impacts on manufactured goods like cereals and even soft drinks this fall and rising meat prices next year.
Researchers have pegged inflation and “rate of income” as two major factors for voters in presidential elections. With gas prices again inching up and “now the drought impact on the food sector, we’re going to have an inflation issue here, and that will put a damper on consumer confidence and will have a major impact on the election,” says Michael Walden, a consumer economics expert at North Carolina State University in Raleigh.
Record-setting heat waves that have fueled fires in the Mountain West have also had a dramatic effect on the corn crop at a particularly vulnerable time. Currently, 30 percent of the corn crop in the 18 chief corn-growing states is now in poor condition, up 8 percentage points from a week earlier.
"In the hottest areas last week, which were generally dry, crop conditions deteriorated quickly," wrote Rich Tinker, author of the Drought Monitor.
Inflation, which had been estimated at 2.5 percent to 3.5 percent for this year, likely will inch up to 3 percent to 3.5 percent, Chris Hurt, a Purdue University agricultural economist, tells The Town Talk news site.
No one is suggesting that President Obama should take direct blame for the drought. In fact, his administration has been adamant about taking on global climate change, which some suggest could be playing a role in the unseasonably, and in many places historic, heat that’s blanketed the country this year.
Yet drought-related food inflation could serve to highlight the overall weakness of the economy – a potential problem for Mr. Obama.
Of course, the current drought could break, as it seems to have begun to do in Georgia, where copious rain has fallen in the past few days. Moreover, the extent and timing of rising food prices remain big X factors as the two presidential campaigns steer toward November.
“Whether [the drought] affects the election will depend on the timing,” says James Campbell, a political scientist who specializes in presidential politics at the University at Buffalo in New York. “The drought will most likely affect food prices later in the year, and the question is, will that be too late to make a difference?”
More than three-quarters of voters will likely have made up their minds before the last days of the election, when food prices might be rising. But Professor Campbell adds: “Those late deciders, they’re going to decide the election.”

Romney sees D.C. school vouchers as model for U.S.

Photo by: Mary Altaffer
Presumptive Republican presidential nominee Mitt Romney speaks to reporters on a campaign charter flight between New York and Washington on Wednesday, May 23, 2012. (AP Photo/Mary Altaffer)

Mitt Romney vowed Wednesday to expand Washington’s school voucher program as part of a broader nationwide push for school choice, and he accused President Obama of failing to fulfill his own education promises from 2008 because he is too beholden to teachers unions.
Opening a new line of attack on the president, Mr. Romney, the presumptive Republican nominee, said unions are the chief impediment to education reform, and that Mr. Obama has repeatedly sided with them instead of with parents and students attending failing schools.
The attack was part of an education speech Mr. Romney delivered in the nation’s capital to the Latino Coalition, a Hispanic small-business advocacy group, and signaled an astute political calculation: Hispanic voters regularly place education among their top issues, even higher than immigration, and they generally support vouchers and stricter school standards.
“Here we are in the most prosperous nation, but millions of children are getting a Third World education. And America’s minority children suffer the most,” Mr. Romney said. “This is the civil rights issue of our era. And it’s the great challenge of our time.”
Mr. Romney’s chief reform would be to give children who receive federal education money a choice of any public or charter school in their state or, in cases where it’s legal under state law, private schools. He also said he’ll push for more usable evaluations of schools so parents have the information they need to make choices, and said he’ll streamline federal teacher quality programs to reward states that are doing best at training and retaining good teachers.
In the most pointed part of his plan, Mr. Romney said he would fight the teachers unions, which he called “the clearest example of a group that has lost its way.” He said teachers unions have teamed up with Democrats to block reforms that have shown promise in Connecticut, Detroit and in the District, where the city’s voucher program has proved wildly popular with parents, but saw Democrats try to cut it.
“In the Opportunity Scholarships, the Democrats finally found the one federal program they are willing to cut. Why? Because success anywhere in our public schools is a rebuke to failure everywhere else,” Mr. Romneysaid. “That’s why the unions oppose even the most common-sense improvements.”
Driving his message home, he plans to visit a charter school in Philadelphia on Thursday.
The Obama campaign said voters should be wary of Mr. Romney’s promises, saying he cut education funding when he was governor of Massachusetts and has backed budget plans that would call for cuts to domestic spending, including education.

“He wants to apply Romney economics to education,” said Ben LaBolt, an Obama campaign spokesman.
The National Education Association, the country’s largest teachers union, said Mr. Romney’s plans were a rehash of President George W. Bush’s education policy. The association also criticized the candidate’s list of education advisers, saying it was stacked with opponents of public schools.
The NEA endorsed Mr. Obama for re-election last July, well before the Republican nomination had been settled.
Both the White House and the NEA mocked Mr. Romney for speaking out now on education, saying if he cared about the issue he should have made it a bigger part of his primary election campaign.
Mr. Romney said if it weren’t for the economy, education would be the most important topic in this year’s election.
A number of Republican governors have won office in recent years on promises of education reforms, and highlighting education before a Hispanic audience could help Mr. Romney make inroads with that important group of voters.
Raul Gonzalez, director of legislative affairs for the National Council of La Raza, the largest umbrella organization for Hispanic groups, said Hispanics do consider education to be a major civil rights issue and thatMr. Romney’s push for vouchers likely will play well.
Still, he said, other than Mr. Romney’s push for school choice, and Mr. Obama’s Race to the Top program that rewards innovative schools, the two men share many similarities on education. Both favor moving away from some of the accountability provisions in Mr. Bush’s No Child Left Behind legislation, and have stressed teacher effectiveness as a solution for poor schools.
Mr. Gonzalez said there’s plenty of room for both men to have a more detailed discussion of education. He said he will be looking to see whether Mr. Romney pushes reforms that make it easier for communities to start charter schools.
Possibly the biggest difference between Mr. Obama and Mr. Romney is on the District’s Opportunity Scholarship Program, which offers federal taxpayer-funded vouchers to low-income students.
It has been contentious from the time it started a decade ago, with the powerful teachers unions opposing it but city parents in support.
As of this year, more than 1,600 students are enrolled in the program, which offers scholarships of up to $8,000 through eighth grade and $12,000 for ninth through 12th grades. The money goes to pay tuition at private schools, including religiously affiliated schools.
Mr. Obama tried to end the program when he took office, but eventually reached a compromise that let students already in the program continue, but halted new applications.
When Republicans took control of the House last year, Speaker John A. Boehner fought to restart the program, and insisted that funding be included in spending bills.
But the program remains on edge, and Mr. Obama’s 2013 budget, submitted in January, doesn’t include any money for it going forward. His administration argues that it has enough money to cover students for the next year.
Mr. Boehner, Ohio Republican, and Sen. Joe Lieberman, Connecticut independent, questioned Mr. Obama’s decision, and Mr. Boehner has vowed to demand that the program be funded.

Amid unusually widespread drought, warnings on food prices

The drought has already raised the price of corn following lowered USDA crop projections that some experts say are still optimistic. Look for meats to lead the way as food prices rise.
Temp Headline Image
Leaves become dry and brittle on stalks of corn in a parched field outside Effingham, Ill., Monday, July 16. The drought gripping the United States is the widest since 1956, according to new data released Monday by the National Oceanic and Atmospheric Administration.
(Robert Ray/AP)

By Staff writer
posted July 16, 2012 at 7:54 pm EDT
Los AngelesFarmers from Illinois to Wyoming are watching crops and livestock wither as the most widespread drought since 1956 persists across more than half the US, and higher food prices won’t be far behind.
Already, the US Department of Agriculture has lowered its crop projections for corn by some 12 percent, and the price of corn has jumped 34 percent in the past months alone. As corn – one of the hardest hit crops – is one of the main ingredients in everything from, well, corn flakes to cattle feed, experts say a rise in food prices is inevitable.
“Prices are going to go up,” says Justin Gardner, assistant professor of agribusiness at Middle Tennessee State University. “The only question is when.”
The first categories to be hit, he says, are meats, such as beef, poultry and swine. But “figuring how quickly the pocketbook will get hit is a bit tricky,” he notes, “you have to figure how long it takes to move corn into cattle and into your grocery store.”
Americans are probably already seeing the drought’s impact, and it will get worse before it gets better, says Jeff Born, a finance professor and director of the executive MBA program at Northeastern University in Boston.
He visited parts of the afflicted area a couple of weeks ago and says there has been no significant relief with rain. He points out that while corn is resilient, if the stalk dies the ears cannot get water no matter how much rain falls later.
Bottom line, he says via e-mail, is that “if you like bacon/pork you should buy it now, because by the fall you are going to be stunned at what it will cost.”
USDA officials, however, are predicting a less dramatic impact on food prices. According to USDA estimates, only 14.6 cents of every grocery dollar goes to farmers or ranchers. Labor and processing make up a much larger part of the cost of food, points out Professor Gardner, adding that “the impact of the drought won’t really change those costs.”
The USDA calculates that overall prices rise one percent for every 50 percent increase in the price of corn. On Sunday, Agriculture Secretary Tom Vilsack appeared onCNN’s “State of the Union” to say it’s too soon to see the crop losses now being witnessed across the nation’s bread basket translate into sticker shock at the grocery store.
While commodity prices will likely increase, he said, “it will have a marginal impact on food prices.” He added that energy prices drive up food prices more significantly.
“The prices and the impact of a drought probably will not likely be seen in the grocery aisles until later next year, 2013,” he said.
But according to farmer Steve Ford, who is  an associate professor of economics at  The University of the South in Sewanee, Tenn., the outlook may be gloomier than government statistics project.
"My sources in the Midwest tell me that the drought is actually worse than indicated in USDA's recent yield estimates,” he says via e-mail. He says the USDA estimates of a 12 percent decline in corn yields were from “overly optimistic initial yield estimates.” He suggests that farmers will more than likely see close to another 10 percent decline in yield.
Even so, he adds, projected corn production in 2012 is still higher than the levels in 2010 or 2011.  What will make the difference is global demand, which is higher. As far as the economics of livestock, he points out that much of the adjustment to higher feed costs has already been made through reductions in animal numbers.
However, he adds, “it will still be hard for those remaining in business this year. The issue will be how many will remain in business until grain prices decline.”
How hard your bottom line is hit depends on where you are in the food chain, says Scott Rothbort, publisher of The LakeView Restaurant & Food Chain Report and president of Lakeview Asset Management in Milburn, N.J.
Large companies such as Kellogg’s and General Mills hedge their losses in the marketplace, protecting themselves from small price gyrations of the marketplace for up to six months. Restaurants and other food vendors do the same, with longterm contracts that lock in price stability.
Even farmers have crop insurance to cover their losses, a federal program that by some estimates may top $30 billion in 2012. “But prices for the average consumer at the grocery store will be more problematic,” he says, adding, “certainly fresh produce, meat, and baked goods will be impacted.”
The weather may not help out any time soon, points out Clark University drought expert Christopher Williams.
This drought is unusual, he says, because normally they tend to be “patchy,” meaning that while one area of the country is experiencing drought, others are compensating with other weather.
But what makes this drought “so impressive is that it is largely continuous.” More than half the country is engulfed by this drought, he points out, adding, “that makes it special,” and the longer term impact less clear.