Democrats Slam Brakes on Health Care Overhau

I do not know what to believe anymore, I do not understand why all of a sudden the Dems are talking slow down, wait we have time. No we do not Not us ordinary citizens who do not have health coverage or for those who have coverage and do not get coverage for their ailments.  I am so tired of the Dems they are suppose to back up the President and they have just lied down and let the republications walk all over them. And as for the Republications, I hope that their party dies when the so called tea beggars are all elected and they bomb worse than the ones right now in office. The tea beggars are a bunch of _ _ _ _ _ _ _ _ _ _ _.  They do not believe the President is really the President, they do want health care, no more spending, except for their pork barrell projects, and now that the Corporations have a say so in our Elections we do not have a Democracy. Mark my words. The Republican Party will cease to exist as it is,  if they get ther way, the political environment will change drastically.  And for those Congress persobs who did not know that Corporations have forgien Corporations among them, we know have the possibility of other governments having a say so in our Government.  OMG what has the Supreme Court done,,, they have basically taken away our civil and federal rights as Citizens of the UNITED STATES OF AMERICA.

Our forefathers are turning in their graves, this is what thry fought for, OUR FREEDOM, and now ..........

January 27, 2010

By DAVID M. HERSZENHORN and ROBERT PEAR

WASHINGTON — With no clear path forward on major health care legislation, Democratic leaders in Congress effectively slammed the brakes on President Obama’s top domestic priority on Tuesday, saying that they no longer felt pressure to move quickly on a health bill after eight months of setting deadlines and missing them.
The Senate majority leader, Harry Reid, Democrat of Nevada, deflected questions about health care. “We’re not on health care now,” he said. “We’ve talked a lot about it in the past.” He added, “There is no rush,” and noted that Congress still had most of this year to work on the health bills passed in 2009 by the Senate and the House.
Mr. Reid said that he and the House speaker, Nancy Pelosi of California, were working to map out a way to complete a health care overhaul in coming months. “There are a number of options being discussed,” Mr. Reid said, emphasizing “procedural aspects” of the issue.
At the same time, two centrist Democratic senators who are up for re-election this year, Blanche L. Lincoln of Arkansas and Evan Bayh of Indiana, said that they would resist efforts to muscle through a health care bill using a parliamentary tactic called budget reconciliation, which seemed to be the simplest way to advance the measure.
The White House has said in recent days that it would support that approach.
Some Democrats said that they did not expect any action on health care legislation until late February at earliest, perhaps after Congress returns from a weeklong recess. But the Democrats stand to lose momentum, and every day closer to the November election that the issue remains unresolved may reduce the chances of passing a far-reaching bill.
The gear-shift by Democrats underscored how the health care effort had been derailed by the Republican victory in the Massachusetts special election last week, which effectively denied Democrats the 60th vote they need to be sure of overcoming a Republican filibuster in the Senate. Originally, Mr. Reid wanted to finish a bill early last August.
The comments by lawmakers also served to lower expectations for the president’s State of the Union speech on Wednesday. Lawmakers said they did not expect Mr. Obama to lay out a specific strategy.
“I would be surprised if he says specifically exactly how he hopes to get health care done,” the House majority leader, Steny H. Hoyer of Maryland, said.
None of the options available to lawmakers, including the use of budget reconciliation, seems viable at the moment. Some lawmakers said they expected Congress to try to adopt a greatly pared down bill once it returns to the issue.
“Frankly, we’re trying to figure out what is possible,” Mr. Hoyer said. “Senator Reid needs to determine what is possible on his side of the aisle, you know, what kind of support he can get. And we’re trying to figure out as well what we can pass.”
Speaker Pelosi has said that House Democrats would not simply vote to approve the version of the health care bill adopted by the Senate on Dec. 24 and send it directly to Mr. Obama for his signature. But a plan to win over House members by adopting changes to the Senate bill through the budget reconciliation process, which is not vulnerable to filibuster, ran into substantial resistance on Tuesday.
Mrs. Lincoln, who faces one of the toughest re-election bids among Democrats, said, “I am opposed to and will fight against any attempts to push through changes to the Senate health insurance reform legislation by using budget reconciliation tactics that would allow the Senate to pass a package of changes to our original bill with 51 votes.”
Mr. Bayh said, “It would destroy the opportunity, if there is one, for any bipartisan cooperation the rest of this year on anything else.”
And even if Democrats could agree on using reconciliation to adjust the health care bill, the House and Senate have yet to resolve what the adjustments would be. Major policy differences remain between the House and Senate measures, including a dispute over a proposed tax on high-cost insurance policies, and provisions related to insurance coverage of abortions.
Senator Sherrod Brown, Democrat of Ohio, said he favored a two-step process, under which the House would pass the Senate bill and Congress would then revise it using the fast-track budget procedures. Republicans adamantly oppose that approach.
Senator Joseph I. Lieberman, independent of Connecticut, urged caution. “The White House and Democratic leaders should reach out one more time to Republicans to see if they can find a common ground,” Mr. Lieberman said.
Senator Dianne Feinstein, Democrat of California, said Democratic leaders were assessing their options on health care.
“It’s a timeout,” Mrs. Feinstein said. “The leadership is re-evaluating. They asked us to keep our powder dry.” Mrs. Feinstein said Congressional leaders should simplify the gigantic health care bill and try to pass parts of it that would be understandable to the public. But she also acknowledged that the odds were long for a far-reaching measure.
“I think big, comprehensive bills are very difficult to do in this environment,” she said.
The Senate Republican leader, Mitch McConnell of Kentucky, said White House comments on health care suggested that President Obama was not listening to the American people.
In Elyria, Ohio, on Friday, Mr. Obama said he was not going to “walk away” from the fight for major health legislation. If the bill becomes law, White House officials said, Americans will see its benefits and will embrace it.
But Mr. McConnell said, “This a clear sign that the administration has not gotten the message, that it’s become too attached to its own pet goals, that it’s stuck in neutral when the American people are asking it to change direction.”
The Republican leader said Mr. Obama should “put the 2,700-page Democrat health care plan on the shelf” and “move toward the kind of step-by-step approach Americans really want.” Republicans, however, have not come forward with any new proposals, and Mr. McConnell has said he hopes the health care bill is now dead.

Geithner Must Go--and the Future of the Fed

Comment

By William Greider

January 23, 2010

The first casualty of the president's political debacle will likely be Timothy Geithner, the severely over-confident treasury secretary well known as a lapdog of Wall Street. Geithner was effectively repudiated by the president last week when Barack Obama abruptly announced a new, more aggressive approach to financial reform. But the immediate threat to Geithner is the scandal of collusion and possibly illegal behavior gathering around the Federal Reserve Bank of New York for its megabillion-dollar takeover of insurance giant AIG.

Tim Geithner is standing in the middle of the muck because he was still president of the New York Fed in the fall of 2008 when it rescued AIG with tons of public money (now totaling $180 billion). The facts of the deal are catching up with him now and none are good, since they raise doubts about his competence and his public integrity. This scandal has smoldered for several weeks in newspaper business sections, but is about to grab front-page attention. The House Oversight Committee, chaired by Edolphus Towns, has turned up damning evidence and called Geithner to testify the week of January 27. Committee investigators are poring through some 250,000 e-mails and subpoenaed documents and finding smoking revelations. House Republicans smell blood. House Democrats, given the present climate of popular discontent, are unlikely to rally around tainted goods.
Perhaps the most explosive revelation is that Geithner's subordinates at the New York Fed instructed AIG executives to evade securities law and conceal from the public the $62 billion the insurance company paid out on contracts with the largest investment houses and banks. AIG was already bankrupt and 80 percent owned by the government, kept afloat solely with the billions being injected by the central bank. Yet the Fed told the company to pay off the bankers at full value--100 percent on the dollar--without negotiating a better deal for the public. The bankers would not have collected a dime if the government hadn't come to the rescue.
The Fed, in other words, gave the largest, most prestigious banks a very sweet deal--much sweeter than anything the banks or the federal government will offer to homeowners facing mortgage foreclosure. The central bank, in effect, was operating a backdoor bank bailout that nobody could see. The public billions devoted to AIG went in one door at the insurance company and came out another door to the private banks. Goldman Sachs alone collected $13 billion.
Failure to disclose is a big no-no in corporate finance. People can go to jail if they willfully withhold material information from shareholders and the Securities and Exchange Commission (SEC), or they may be sued for investor fraud. Yet that is what the New York Fed told AIG to do. The company officers wanted to report fully to the SEC. Their Fed overseers told them to take out the disclosure out of their report to the SEC (the facts were ultimately not disclosed until five months later). The Fed, remember, is the government's principal banking regulator. It is supposed to enforce the laws, not tell regulated firms to break them.
What was the Fed anxious to hide? Clearly, it was the clandestine and illegitimate conduit it had devised at AIG to funnel billions to the banks, unseen by the public. Keeping this bailout secret would avoid arousing even greater anger about the bailouts. It might also help prop up stock prices at endangered banks, though savvy financial players swiftly figured out what was going on. Only the people needed to be kept in the dark, along with their elected representatives in Congress.
The Federal Reserve was trying to cover its own butt. And Timothy Geithner's. Disclosing precisely what Geithner had done to arrange backdoor bailouts on the New York end would have definitely damaged his chance of becoming Obama's treasury secretary. When the facts were eventually acknowledged, members of Congress repeatedly demanded to know which firms got the Fed's money. The Federal Reserve Chairman and his top deputies said it would be "inappropriate" to say.
Somebody seems to be lying in this matter. When the Fed's irregular action to block AIG's full disclosure was first reported, Treasury officials said Geithner was not involved because he had "recused" himself from the AIG dealings. Yet, according to the latest revelations reported by the New York Times, the general counsel of the New York Fed, Thomas Baxter, has told House investigators that Geithner verbally approved AIG's generous payouts to the banks.
So which is it? Was Geithner involved or wasn't he? It seems highly improbable Geithner could have managed to remain ignorant of this very controversial decision not to disclose. In fact, it would have been derelict for him not to have known. Committee members will want to probe the question further--what did Tim Geithner know and when did he know it? Let's hope he is under oath. Martha Stewart, remember, went to prison not for trading stocks on insider information but because she lied to federal investigators.
The treasury secretary's precarious situation may well spill over to damage the fate of Federal Reserve chairman Ben Bernanke, seeking Senate confirmation for a second term. Until now, the Board of Governors in Washington has claimed to be aloof from the AIG mess at the New York Fed. This may also be untrue, according to the latest revelations. Some of the Fed governors in Washington, it turns out, were quite upset by the deals being made by Geithner's staff at the New York Fed. Lying is easier when a government agency is given privileged secrecy.
"What does any of this buy us?" some governors asked, according to one newly disclosed e-mail message. Good question. For that matter, what did the public get for its $180 billion? Senators might want an answer before they vote to give Bernanke another four years. Bernanke's distress was revealed last week when he suddenly announced that he wants a GAO audit of the entire AIG deal-making. That was jarring because Bernanke has repeatedly claimed the Congressional demands for a GAO audit of the Federal Reserve would destroy this sanctified institution.
The smell of scandal poses a more fundamental question about the future of the Federal Reserve. The president's financial reform proposals would authorize the Federal Reserve to become the super-regulator of the entire financial system--empowered in privileged secrecy to decide the most fateful matters of who should fail, who should be saved. The largest banking institutions are comfortable with this "reform," since they proposed the idea. Anyone else who looks closely at the Fed and the AIG fiasco should see immediately the alarming implications.

Blocking Bernanke is Smart Economics, Smart Politics for Dems

posted by John Nichols on 01/26/2010 @ 11:08am

If the Democratic Party wants to lose – or, to be more precise, wants to lose badly in 2010 and 2012, it need only maintain its current loyalty to the most powerful interests on Wall Street.
The United States already has a party of Wall Street. It does not need two.
Yet, despite an occasional populist turn (like his current bank bashing), President Obama has with his absurd nominations and even more absurd policies given every indication that he intends to position the Democratic Party closer to corporate interests than all but the most reprehensible Republicans.
Forget about Obama's rhetorical flourishes. As a candidate and as a president, he has too frequently chosen to side with multinational corporations rather than working Americans.
After he secured the 2008 Democratic presidential nomination, Obama told Fortune magazine that business executives did not need to worry about his talk of reforming U.S. free trade policies; despite some nice rhetorical flourishes on the primary campaign trail in hard-hit industrial states, Obama said, he had no intention of embracing or implementing a fair trade agenda.
Once he was elected, Obama selected as his chief of staff the Democratic party's most ardent advocate for free trade and the broader corporate program, Rahm Emanuel. Then, the new president peopled his administration with Wall Street insiders like Treasury Secretary Tim Geithner and economic adviser Larry Summers.
When it came time to push for stimulus legislation, Obama accepted a plan that squeezed necessary spending for job creation in order to pay for tax cuts for wealthier Americans. Now, instead of the promised unemployment rate of 8 percent or below, we're in double digits.
When it came time to fund an automobile-industry bailout, Obama implemented a plan that shifted tens of billions of money from then U.S. Treasury into the accounts of firms that then announced they would close more than two dozen U.S. auto plants and use the federal money to fund the opening of new factories in China and Mexico. At the same time, those companies forced thousands of auto dealerships to shut their doors and layoff more than 100,000 workers.
In the fight over financial-services regulation, Obama and his aides have repeatedly rejected serious moves to hold banks and brokers to account – creating a circumstance where Democrats in the House and Senate must battle not just Wall Street and the Republican Party but the White House if they hope to achieve meaningful reforms. Even now, as Obama tries to surf some of the anger at big banks, polling tells us that Americans are skeptical – and rightly so, as the president's party continues to collect campaign contributions from, you guessed it, the big banks.
If John McCain had compiled Obama's record, he would be condemned by even the most moderate Democrats as a tool of the corporate elites.
Because Obama is a Democrat, many in his own party continue to cut him slack.
In doing so, they are giving the party of Franklin Roosevelt and Harry Truman just enough rope to hang itself in 2010.
Unless there is a radical shift in direction, Democrats will find themselves running in this fall's congressional and state elections as the party of an economic status quo that most Americans believe is corrupt in its character and damaging in its practices.
How can the Democrats save themselves?
By saying "no" to Obama and to Wall Street when it comes to the direction of the Federal Reserve. Hopefully, that "no" will be heard by the president and his aides in time for the White House to set a sounder course.
But regardless of how Obama responds, congressional Democrats can and should raise the necessary objection – and act upon it when Bernanke's confirmation vote is taken later this week.
The president has nominated Ben Bernanke for a second four-year term as Federal Reserve chairman. No move sums up the failure of Obama and his aides to break with the corporatist policies of the Bush administration more explicitly than the attempt to keep George Bush's Fed chair on the job.
Because the secretive and manipulative Federal Reserve plays such a definitional role in setting and implementing economic policies, Obama's decision to retain those responsible for the current mess is wrongheaded in every sense: economically, socially and politically.
Smart Democrats and independents are refusing to go along with the president's program.
In announcing his decision to vote against Bernanke's reconfirmation, U.S. Senator Russ Feingold, D-Wisconsin, summed things up well:

"A chief responsibility of the Chairman of the Federal Reserve is to ensure a sound financial system. Under the watch of Ben Bernanke, the Federal Reserve permitted grossly irresponsible financial activities that led to the worst financial crisis since the Great Depression. Under Chairman Bernanke's watch predatory mortgage lending flourished, and ‘too big to fail' financial giants were permitted to engage in activities that put our nation's economy at risk. And as it responds to the crisis it helped to usher in, the Federal Reserve under Chairman Bernanke's leadership continues to resist appropriate efforts to review that response, how taxpayers' money was being used, and whether it acted appropriately."

Feingold joins a growing chorus of progressive opposition to the Fed chair's reconfirmation, an opposition that has been led by Senator Bernie Sanders.
The Vermont independent notes that, as chairman of President George W. Bush Council of Economic Advisors and Fed chair: "Mr. Bernanke, who was recently endorsed for reappointment by Alan Greenspan, played a major role in the deregulatory efforts that enabled major financial institutions to engage in reckless and illegal behavior. The American people gave us the responsibility to bring about change, not the maintenance of the status quo. Why, at this difficult moment in American history, should we reappoint Wall Street's candidate as chairman of the Fed?"
Sanders recently offered his colleagues a list of "Four Reasons Why Democrats Should Oppose the Bernanke Reappointment", which concludes: "Instead of confirming one of the key architects of George Bush's economic agenda, a new nominee could transform the Fed into a central bank committed to the needs of the middle class of this country rather than powerful Wall Street executives responsible for the worst economic crisis since the Great Depression."
No one with any sense of the mood of the American people regarding the economy could miss the logic of this argument.
Unfortunately, President Obama seems to be missing the point – even with the recent wake-up call from Massachusetts voters who filled the late Ted Kennedy's Senate seat with a conservative Republican.
Senate Democrats have an opportunity to do more for Obama than the president is willing to do for himself.
"The defeat of Ben Bernanke would give President Obama a golden opportunity to nominate someone who will move the Fed in a new direction and put an end to the Fed's relationship with big banks and Wall Street," says Sanders.
That's the smart and necessary play.
The Senate should block Bernanke as the first step in forcing the President Obama and his administration to recognize the reality that, according to recent polls, more than sixty percent of voters see: When it comes to economics, the United States is headed in the wrong direction.
Instead of steering toward Wall Street, Obama should be veering toward Main Street.
If the president refuses to make the left turn that is needed, then Democratic senators should take the wheel and correct the country's course.

Obama Moves to Centralize Control Over Party Strategy

January 24, 2010

By JEFF ZELENY and PETER BAKER

WASHINGTON — President Obama is reconstituting the team that helped him win the White House to counter Republican challenges in the midterm elections and recalibrate after political setbacks that have narrowed his legislative ambitions.

David Plouffe, who ran the Obama campaign, has been asked to play a bigger role.

Mr. Obama has asked his former campaign manager, David Plouffe, to oversee House, Senate and governor’s races to stave off a hemorrhage of seats in the fall. The president ordered a review of the Democratic political operation — from the White House to party committees — after last week’s Republican victory in the Massachusetts Senate race, aides said.
In addition to Mr. Plouffe, who will primarily work from the Democratic National Committee in consultation with the White House, several top operatives from the Obama campaign will be dispatched across the country to advise major races as part of the president’s attempt to take greater control over the midterm elections, aides said.
“We are turning the corner to a much more political season,” said David Axelrod, a senior adviser, who confirmed Mr. Plouffe’s role. “We are going to evaluate what we need to do to get timely intelligence and early warnings so we don’t face situations like we did in Massachusetts.”
As Mr. Obama prepares to deliver his State of the Union address on Wednesday and lay out his initiatives for the second year of his presidency, his decision to take greater control of the party’s politics signals a new approach. The White House is searching for ways to respond to panic among Democrats over the possible demise of his health care bill and a political landscape being reshaped by a wave of populism.
Improving tactical operations addresses only part of his challenge. A more complicated discussion under way, advisers said, is how to sharpen the president’s message and leadership style.
The reinforcement of the White House’s political operation has been undertaken with a sense of urgency since Tuesday, when a Republican, Scott Brown, won the Massachusetts Senate seat that had been held by Edward M. Kennedy. The White House was caught off guard when it became clear that Democrats were in danger of losing it, and by the time alarm bells sounded from the Democratic Senatorial Campaign Committee, it was too late.
The president summoned Mr. Plouffe to the Oval Office hours before the polls closed and asked him to assume the new role because of the implications the midterm elections hold. Mr. Plouffe built a reputation in 2008 as a master of the nuts and bolts of campaigns, and will assemble a team to provide unfiltered information that serves as an early-warning system so the White House and party officials know if a candidate is falling behind.
The day-to-day political operation will be run by Jim Messina, a deputy White House chief of staff, but Mr. Plouffe will coordinate the effort.
The party is trying to become less reliant on polls conducted by candidates, which can often paint a too-rosy picture of the political outlook. The president’s leading pollster, Joel Benenson, will be among those conducting research for Mr. Plouffe, aides said, along with others who will divide the country by regions.
Mr. Plouffe, who did not follow Mr. Obama to the White House last year, has remained in the president’s tight circle of advisers and has frequently worked on projects for the party.
The first indication of Mr. Plouffe’s more prominent role came in an op-ed article he wrote for the Sunday issue of The Washington Post, presenting a blueprint for how Democrats could avoid big defeats in the fall. He acknowledged the challenges ahead, saying, “We may not have perfect results, but November will be nothing like the nightmare that talking heads have forecast.”
Senator Robert Menendez of New Jersey, chairman of the Democratic Senatorial Campaign Committee, said he had “no interest in sugarcoating” the defeat in Massachusetts. Several party leaders said they expected Mr. Menendez to remain in his position for the rest of the election cycle, but the move by the White House had the effect of subverting at least some of the committee’s authority.
“Our own political operation will be more rigorously in communication with the other elements, so we can compare notes,” Mr. Axelrod said. “What we learned from Massachusetts is that we need to be more assiduous about getting our own data and our own information so we have a better sense of where things stand.”
The White House intends to send Mr. Obama out into the country considerably more in 2010 than during his first year in office, advisers said, to try to rekindle the relationship he developed with voters during his presidential campaign.
His first big chance will come when he delivers his State of the Union address. Rather than unveil a laundry list of new initiatives, advisers said, Mr. Obama will try to reframe his agenda and how he connects it with public concerns. In particular, he will focus on how his ideas for health care, energy and financial regulation all fit into the broader economic mission of creating what he calls a “new foundation” for the country, the key words being “rescue, restore and rebuild.”
While presidents typically experience rough patches, this one is particularly challenging for Mr. Obama. Liberals have grown disenchanted with what they see as his unwillingness to fight harder for their causes; independents have been turned off by his failure, in their view, to change the way Washington works; and Republicans have become implacably hostile.
The long and messy legislative fight over health care is a leading example of how Mr. Obama has failed to connect with voters, advisers say, because he appeared to do whatever it would take to get a bill rather than explain how people could benefit.
“The process often overwhelmed the substance,” said Dan Pfeiffer, the White House communications director. “We need to find ways to try to rise above the maneuvering.”
The discussion inside the White House includes at least two distinct debates: Should Mr. Obama assume a more populist or centrist theme in his message? And should the White House do what it takes to pass compromise legislation or should it force votes, which even if unsuccessful can be used to carry an argument against Republicans in the fall?
It remains an open question how much new legislation will pass Congress, but the coming months will help frame the campaigns. While some form of financial regulation and job creation measures may pass, Obama aides said, larger initiatives like health care, a cap on carbon emissions and an immigration overhaul may have to wait, even though the White House denies trimming its ambitions.
“I wouldn’t say the door is shut on trying to find some places where you can develop a strategy for a bipartisan vote in the Senate,” said John D. Podesta, a former White House chief of staff under President Bill Clinton who advises the Obama team.
But he said Republicans appeared determined to oppose any initiative Mr. Obama offers. “They would try to deny him passing the Mother’s Day resolution,” he said.
Some veterans of the Clinton White House have advised their friends in the West Wing to take a breath and not make lasting decisions in the immediate aftermath of the election, when it might be tempting to overreact.
Rahm Emanuel, the White House chief of staff and himself a Clinton alumnus, gave a pep talk at the senior staff meeting last week. “These things go in cycles,” participants recalled him saying. “We’ve got a lot of work to do. Keep your head up and keep going.”

They Still Don’t Get It

January 23, 2010
Op-Ed Columnist
They Still Don’t Get It
By BOB HERBERT

How loud do the alarms have to get? There is an economic emergency in the country with millions upon millions of Americans riddled with fear and anxiety as they struggle with long-term joblessness, home foreclosures, personal bankruptcies and dwindling opportunities for themselves and their children.

The door is being slammed on the American dream and the politicians, including the president and his Democratic allies on Capitol Hill, seem not just helpless to deal with the crisis, but completely out of touch with the hardships that have fallen on so many.

While the nation was suffering through the worst economy since the Depression, the Democrats wasted a year squabbling like unruly toddlers over health insurance legislation. No one in his or her right mind could have believed that a workable, efficient, cost-effective system could come out of the monstrously ugly plan that finally emerged from the Senate after long months of shady alliances, disgraceful back-room deals, outlandish payoffs and abject capitulation to the insurance companies and giant pharmaceutical outfits.

The public interest? Forget about it.

With the power elite consumed with its incessant, discordant fiddling over health care, the economic plight of ordinary Americans, from the middle class to the very poor, got pathetically short shrift. And there is no evidence, even now, that leaders of either party fully grasp the depth of the crisis, which began long before the official start of the Great Recession in December 2007.

A new study from the Brookings Institution tells us that the largest and fastest-growing population of poor people in the U.S. is in the suburbs. You don’t hear about this from the politicians who are always so anxious to tell you, in between fund-raisers and photo-ops, what a great job they’re doing. From 2000 to 2008, the number of poor people in the U.S. grew by 5.2 million, reaching nearly 40 million. That represented an increase of 15.4 percent in the poor population, which was more than twice the increase in the population as a whole during that period.

The study does not include data from 2009, when so many millions of families were just hammered by the recession. So the reality is worse than the Brookings figures would indicate.

Job losses, stagnant or reduced wages over the past decade, and the loss of home equity when the housing bubble burst have combined to take a horrendous toll on families who thought they had done all the right things and were living the dream. A great deal of that bleeding is in the suburbs. The study, compiled by the Brookings Metropolitan Policy Program, said, “Suburbs gained more than 2.5 million poor individuals, accounting for almost half of the total increase in the nation’s poor population since 2000.”

Democrats in search of clues as to why voters are unhappy may want to take a look at the report. In 2008, a startling 91.6 million people — more than 30 percent of the entire U.S. population — fell below 200 percent of the federal poverty line, which is a meager $21,834 for a family of four.

The question for Democrats is whether there is anything that will wake them up to their obligation to extend a powerful hand to ordinary Americans and help them take the government, including the Supreme Court, back from the big banks, the giant corporations and the myriad other predatory interests that put the value of a dollar high above the value of human beings.

The Democrats still hold the presidency and large majorities in both houses of Congress. The idea that they are not spending every waking hour trying to fix the broken economic system and put suffering Americans back to work is beyond pathetic. Deficit reduction is now the mantra in Washington, which means that new large-scale investments in infrastructure and other measures to ease the employment crisis and jump-start the most promising industries of the 21st century are highly unlikely.

What we’ll get instead is rhetoric. It’s cheap, so we can expect a lot of it.

Those at the bottom of the economic heap seem all but doomed in this environment. The Center for Labor Market Studies at Northeastern University in Boston put the matter in stark perspective after analyzing the employment challenges facing young people in Chicago: “Labor market conditions for 16-19 and 20-24-year-olds in the city of Chicago in 2009 are the equivalent of a Great Depression-era, especially for young black men.”

The Republican Party has abandoned any serious approach to the nation’s biggest problems, economic or otherwise. It may be resurgent, but it’s not a serious party. That leaves only the Democrats, a party that once championed working people and the poor, but has long since lost its way.

Bankers’ Sense of Entitlement

January 24, 2010
Editorial
Bankers’ Sense of Entitlement

We suspect most Americans would be baffled to realize that bankers see themselves as victims of the Obama administration’s financial policies. But there you go.

Irate at the administration’s decision to impose a fee on the largest banks, the bank lobby has hired a top lawyer to challenge the levy all the way up to the Supreme Court. Their case seems to rest on the perplexing argument that the fee would amount to a bill of attainder, which singles out a specific group of people and violates their right to due process. But the levy is aimed at a class — very large financial institutions. There are other taxes, fines and fees that operate in the same sort of way.

The push-back against the fee underscores bankers’ peculiar sense of entitlement. They feel entitled to the public support dished out by the Treasury, the F.D.I.C. and the Federal Reserve. Yet they do not believe they should be made to contribute toward the effort to save the economy from their reckless behavior.

President Obama articulated the fee as a way to recover the $117 billion cost of the direct financial bailout. It would apply to financial institutions with more than $50 billion in assets. (Bank of America, the country’s largest bank, would have to pay about $1.5 billion a year.)

Mr. Obama could have gone further. Government assistance to the banks went far beyond the Treasury’s bailout — large guarantees from the F.D.I.C., copious lending from the Federal Reserve, extremely low interest rates. And the damage caused by the banks exceeded $117 billion by an order of magnitude.

A levy on big banks’ assets could also be seen as a way to slow the further consolidation of a banking system that already has too many banks considered too big to fail. It fits the administration’s avowed interest in limiting the size of commercial banks by tightening limits on their market shares. In any case, having spent trillions to drag the economy back from the brink of the abyss, the government needs the money.

And the money is there. Goldman Sachs said last week that it would set aside 35.8 percent of last year’s revenue to pay bonuses. That is down from the 48 percent Goldman doled out for bonuses in 2008. But it adds up to an obscene $16.2 billion, more than 10 times what the proposed levy is expected to cost the bank each year.

Bankers would do well to stop trying to avoid this fee, and they should stop trying to block broad-based reforms intended to create a more solid financial system.

Health Care Crisis

What is going to happen to Health Care Reform?  Is it Dead? Will the House go back and start again on a much smaller concise bill?  Will the House try and pass the Senate bill?
What does the President want? Why hasn't He said more? Is he playing nice with Republicans? If he is it is not working and He needs to stand up for His base and Independents. He needs to stand be4 the people who elected him and tell it just like it is. No pussyfooting' around, no sweet talk, No hands across the isle because the republicans do not want it and have said so more than once.
Click links to see articles

Obama weighs Paring Goals for Health Bill

Stephen Crowley/The New York Times

The Republican Senate leader, Mitch McConnell of Kentucky, showed little new willingness to collaborate with the Democrats.

A New Search for Consensus on Health Care Bill


Do the Right Thing By PAUL KRUGMAN  OP-ED

The Court’s Blow to Democracy

January 22, 2010

Editorial

New York Times

With a single, disastrous 5-to-4 ruling, the Supreme Court has thrust politics back to the robber-baron era of the 19th century. Disingenuously waving the flag of the First Amendment, the court’s conservative majority has paved the way for corporations to use their vast treasuries to overwhelm elections and intimidate elected officials into doing their bidding.

Congress must act immediately to limit the damage of this radical decision, which strikes at the heart of democracy.


As a result of Thursday’s ruling, corporations have been unleashed from the longstanding ban against their spending directly on political campaigns and will be free to spend as much money as they want to elect and defeat candidates. If a member of Congress tries to stand up to a wealthy special interest, its lobbyists can credibly threaten: We’ll spend whatever it takes to defeat you.

The ruling in Citizens United v. Federal Election Commission radically reverses well-established law and erodes a wall that has stood for a century between corporations and electoral politics. (The ruling also frees up labor unions to spend, though they have far less money at their disposal.)

The founders of this nation warned about the dangers of corporate influence. The Constitution they wrote mentions many things and assigns them rights and protections — the people, militias, the press, religions. But it does not mention corporations.

In 1907, as corporations reached new heights of wealth and power, Congress made its views of the relationship between corporations and campaigning clear: It banned them from contributing to candidates. At midcentury, it enacted the broader ban on spending that was repeatedly reaffirmed over the decades until it was struck down on Thursday.

This issue should never have been before the court. The justices overreached and seized on a case involving a narrower, technical question involving the broadcast of a movie that attacked Hillary Rodham Clinton during the 2008 campaign. The court elevated that case to a forum for striking down the entire ban on corporate spending and then rushed the process of hearing the case at breakneck speed. It gave lawyers a month to prepare briefs on an issue of enormous complexity, and it scheduled arguments during its vacation.

Chief Justice John Roberts Jr., no doubt aware of how sharply these actions clash with his confirmation-time vow to be judicially modest and simply “call balls and strikes,” wrote a separate opinion trying to excuse the shameless judicial overreaching.

The majority is deeply wrong on the law. Most wrongheaded of all is its insistence that corporations are just like people and entitled to the same First Amendment rights. It is an odd claim since companies are creations of the state that exist to make money. They are given special privileges, including different tax rates, to do just that. It was a fundamental misreading of the Constitution to say that these artificial legal constructs have the same right to spend money on politics as ordinary Americans have to speak out in support of a candidate.

The majority also makes the nonsensical claim that, unlike campaign contributions, which are still prohibited, independent expenditures by corporations “do not give rise to corruption or the appearance of corruption.” If Wall Street bankers told members of Congress that they would spend millions of dollars to defeat anyone who opposed their bailout, and then did so, it would certainly look corrupt.

After the court heard the case, Senator John McCain told reporters that he was troubled by the “extreme naïveté” some of the justices showed about the role of special-interest money in Congressional lawmaking.

In dissent, Justice John Paul Stevens warned that the ruling not only threatens democracy but “will, I fear, do damage to this institution.” History is, indeed, likely to look harshly not only on the decision but the court that delivered it. The Citizens United ruling is likely to be viewed as a shameful bookend to Bush v. Gore. With one 5-to-4 decision, the court’s conservative majority stopped valid votes from being counted to ensure the election of a conservative president. Now a similar conservative majority has distorted the political system to ensure that Republican candidates will be at an enormous advantage in future elections.

Congress and members of the public who care about fair elections and clean government need to mobilize right away, a cause President Obama has said he would join. Congress should repair the presidential public finance system and create another one for Congressional elections to help ordinary Americans contribute to campaigns. It should also enact a law requiring publicly traded corporations to get the approval of their shareholders before spending on political campaigns.

These would be important steps, but they would not be enough. The real solution lies in getting the court’s ruling overturned. The four dissenters made an eloquent case for why the decision was wrong on the law and dangerous. With one more vote, they could rescue democracy.

With Populist Stance, Obama Takes On Banks

 I am always updating my blogg if I find an article or a video that helps support what I report

January 22, 2010

 Obama calls for Limits on Banks

By JACKIE CALMES

WASHINGTON — The tougher approach to financial regulation that President Obama outlined on Thursday reflected a changed political climate, the rebound in big banks’ fortunes after their taxpayer bailout and a shift in power within the administration away from those who had been seen as most sympathetic to Wall Street.
In calling for new limits on the size of big banks and their ability to make risky bets, Mr. Obama was throwing a public punch at Wall Street for the third time in a week, underscoring the imperative for him and his party to strike a more populist tone, especially after the Republican victory Tuesday in the Massachusetts Senate race.
In announcing his proposals Thursday at the White House, Mr. Obama said if the financial industry wanted a fight over new restrictions, it was a fight he was ready to have.

President Obama, with his economic adviser Paul Volcker at his side, told the banking industry on Thursday he was ready to fight.

The new approach was welcomed by the White House political team and Vice President Joseph R. Biden Jr., and delivered by a less enthusiastic economic team on orders last month from Mr. Obama.
It was also a victory for Paul A. Volcker, the former Federal Reserve chairman and outside adviser to Mr. Obama.
Until Thursday, when he stood beside the president at the White House announcement of the new policy, Mr. Volcker truly had been on the outside of administration decision-making. And, in frustration, he had been increasingly vocal about the need for the administration to clamp down on what he described as the casinolike operations at the big banks that nearly destroyed the financial system in the first place.
In adopting the tougher line, Mr. Obama set aside a more limited approach to regulation that had been championed since last year by his economic team, led by Treasury Secretary Timothy F. Geithner.
Yet even Mr. Geithner of late has been moving toward a tougher stance on Wall Street, in part out of anger that big banks, having ridden a taxpayer bailout back to comfortable profitability, are now rewarding themselves with big bonuses and fighting harder in Congress against the administration’s initiative to tighten regulation of the financial system.
The issue reignited speculation, common in the administration’s early months, that Mr. Geithner and perhaps Lawrence H. Summers, the senior White House economic adviser, were not long for the Obama world given broad public perceptions that they remained too close to the financial industry.
But numerous administration officials said that both men had earned the trust and confidence of Mr. Obama, who believed they had not received credit for stabilizing a financial system that by all accounts was on the verge of collapse when the president took office.
His pique on that score came through in his televised interview with ABC News on Wednesday, after the loss in Massachusetts, even as Mr. Obama empathized with Americans’ anger about the bailout effort, the Troubled Asset Relief Program, that he inherited from George W. Bush.
“Now if I tell them, ‘Well, it turns out that we will actually have gotten TARP paid back and that we’re going to make sure that a fee’s imposed on the big banks so that this thing will cost the taxpayers not a dime,’ that’s helpful,” Mr. Obama said. “But it doesn’t eliminate the sense that their voices aren’t heard and that institutions are betraying them.”
To change that, he added, “We’re about to get into a big fight with the banks.”
That fight is sure to continue testing Mr. Geithner, as well as Mr. Summers and lesser-known members of the economic team who are seen by others in the West Wing as politically tone-deaf. Yet Mr. Geithner, in an interview, said he foresaw no problems.
“Just because things seem populist doesn’t mean they’re not the right thing to do,” he said.
The administration’s new tack suggests just how much big banks have miscalculated Americans’ intensified resentment against the bailout — anger stoked by persistent high unemployment, banks’ stinginess in lending to small business and the revival of Wall Street’s bonus culture.
They have become the perfect foil for the White House as it tries to lead the Democratic Party out of its post-Massachusetts morass — and to change the channel from the seemingly unending debate over health insurance. As the White House hopes to define the fight, the enemy is not big government but big money.
One problem for the Obama team, as some Congressional Democrats lament, is that its moves of late look poll-driven and overly reactive to the Democrats’ implosion in the Bay State race. To be sure, worse for the White House than Scott Brown’s win is the fact that the Republican won as an agent of change just as Mr. Obama did in 2008 — only this time, of course, the change was not from Bush administration policies but from Mr. Obama’s.
Despite the timing, however, all three of Mr. Obama’s recent policy stands have been in the works for some time. That is not to say they were not politically motivated; for some months, the administration has been concerned about Mr. Obama’s slipping support in the polls and many Americans’ perception of his administration as too cozy with Wall Street.
The president’s proposal last week for a tax on about 50 of the nation’s biggest banks to recoup any losses from the bailout began taking shape at the Treasury last August for inclusion in the budget that Mr. Obama will send to Congress in February, administration officials said.
Aside from its value as a way to raise $90 billion over 10 years, a time frame in which Mr. Obama is eager to cut deficits, the bank tax helped mute long-running criticism of Mr. Geithner for his opposition last summer to European leaders’ calls for taxing bank bonuses and transactions.
Earlier this week, with action heating up in the Senate over legislation for regulating banks, administration officials spread the word that Mr. Obama’s proposal to create an independent consumer protection agency was “non-negotiable.” Industry lobbyists have made killing the agency a priority, while liberal groups have made its creation a test of Mr. Obama’s leadership.
Mr. Obama personally weighed in with a lengthy meeting at the White House on Tuesday with the panel’s chairman, Senator Christopher J. Dodd, a Democrat from Connecticut.
Until now, the president has had a low profile on the banking bill, though the House debated its version most of last year before passing it in December.
Some Democrats complain that the White House was too absorbed by the health care issue, but they acknowledge the banking issue was widely seen as an insider’s game over arcane issues like derivatives trading that have little resonance with the public.
Now that has changed. As Thursday’s call for new bank limits showed, the president personally is taking the lead as First Populist.
“Never again,” he said, “will the American taxpayer be held hostage by a bank that is too big to fail.”

Reactions to the Bank Proposal

January 21, 2010, 12:51 pm

By CATHERINE RAMPELL

Update | 2:50 p.m.
Excerpts of reactions from around the econoblogosphere to the administration’s (still somewhat hazy) bank proposal:

“The problem of ‘too big to fail’ isn’t that some institutions are large, it’s that there is currently no statutory authority to wind down a financial conglomerate in the way that the F.D.I.C. is currently authorized to unwind banks. More effective supervision, coupled with the authority to seize and wind down large firms, is the appropriate remedy to ‘too big to fail.’” — Rob Nichols, president of the Financial Services Forum
“I am concerned, as a general matter, about arbitrarily limiting the size of the banks, since our modern, complicated, global economy demands that the United States have at least a few banks capable of providing a very wide range of services each on a large enough scale to be efficient. However, there certainly may be circumstances in which regulators ought to push a bank or banks to be smaller in general or smaller in certain activities.” — Douglas J. Elliott, Brookings Institution
“Now note we have to move two other pieces of reform in order to make this credible: we need a system where parties are aware of the derivatives holdings of an investment bank precrisis, say through a clearinghouse or exchange, so to make resolution credible and prevent panics. We also need a new resolution authority to handle these firms in a manner that won’t destroy the system.” — Mike Konczal, Roosevelt Institute
“The banks of course will scream blue murder, while at the same time trying to say that those kinds of walls exist already. But they can’t have it both ways.” — Felix Salmon, Reuters
“In principle, I am against attempts by government to structure industries. But I take the view that the political economy of small banks is better than that of large banks. Large banks find it easy to persuade regulators that they are doing wonderful things and find it easy to persuade politicians that they need to be bailed out. Maybe small banks would find this task somewhat harder.” — Arnold Kling, EconLog
“We believe providing for strengthened regulatory oversight and flexibility like that originally proposed by the administration, as opposed to arbitrary restrictions on growth and activities, is a more effective way of mitigating systemic risk and ending ‘too big to fail.’” — Tim Ryan, president and C.E.O. of Securities Industry and Financial Markets Association
“Will the White House have the courage of its convictions and really fight the big banks on this issue? If the White House goes into this fight half-hearted or without really understanding (or explaining) the underlying problem of unfettered banks that are too big to fail, they will not win.” — Simon Johnson, BaselineScenario and M.I.T. Sloan School of Business
“Should the proposal go through, it will force some banks to close down or sell off certain units. The more likely — and most desired — response would be for Goldman and Morgan to give up their bank holding company status and go back to obtaining their funding from the market. The higher cost of capital and challenge of raising funds will make it harder for them to be so big. That’s the point.” — Daniel Gross, Slate
“I don’t think we’ll get anywhere near the amount of change we need when all is mostly said and little actually gets done — but this is a move in the right direction. Too bad it didn’t happen months ago.” — Mark Thoma, Economist’s View
“But it should be absolutely clear that banks which are too big to fail must be shrunk, and that using government-guaranteed consumer deposits to trade securities for profit is a terrible idea. It is a relief to see these holes in the regulatory structure get some attention.” — The Economist
“Perhaps it’s time to recognize the limits of regulators, no matter how diligent and sophisticated they try to be. If you can’t truly keep on top of a complex industry that changes constantly, maybe the wiser course is just to limit what the individual players can do.” — Edmund L. Andrews, Capital Gains and Games
“This wouldn’t have done anything to stop Lehman, which also had very little to do with commercial banking.” — Ezra Klein, The Washington Post
“How does it affect the political economy of bank lobbying?” — Tyler Cowen, Marginal Revolution
“Without more detail on how the limits on the market share of liabilities will be measured and enforced, it’s hard to say how effective they’ll be, but that’s probably the best angle to take when thinking about shrinking bank size.” — Tim Fernholz, The American Prospect

Geithner on the Bank Proposal

January 21, 2010, 7:24 pm

By CATHERINE RAMPELL

Treasury Secretary Timothy Geithner is being interviewed on the “PBS NewsHour” tonight about the administration’s new bank proposal, a k a “the Volcker Rule,” released today. Here are a couple of highlights from the interview, according to a transcript released by PBS. (Sorry, I can’t find a link yet.)
Here is how Mr. Geithner explains today’s banking proposal:
The basic principle is that banks that have the privilege of taking advantage of the safety net should not use that to subsidize risky activity. I think it’s a simple principle, I think people can understand that and we’re going to do it in a careful, well-designed way.
And here he is asked what motivated the timing behind this announcement, but doesn’t really answer:

JUDY WOODRUFF: A couple of questions about the timing, Mr. Secretary. Former Federal Reserve Board Chairman Paul Volcker, who heads up the Economic Recovery Board for the president, he has publicly advocated this for the last year. He’s been very open about it. He told reporters last summer the president had said no to this. What changed the president’s mind?
MR. GEITHNER: I am – I would just want you to know – very close to Paul Volcker, have enormous respect for him. And the president and I have been talking to him about this for a long period of time. And you saw in the House bill that passed the House and even in the draft Senate bill a provision that was very responsive to Paul Volcker’s ideas. And this provision would give the Fed the authority to impose these types of restrictions, exactly these types of restrictions. We thought it was time now to provide a little more clarity though about what this would mean because as I said, we’re at this critical moment where we need to make the last push to get reforms through the Senate. And that’s why –

MS. WOODRUFF: But why not do it earlier?
MR. GEITHNER: Well, we’ve been – again, we’ve been working on how best to do this for some time. And we thought now was the time to bring some clarity to it.

MS. WOODRUFF: And I also ask because as you well know, there are voices out there today saying this is largely politically driven, that coming on the heels of the Massachusetts Senate outcome, a Republican won. You have polls showing Americans increasingly unhappy about administration policies, a sense the administration has been too soft on Wall Street, that that’s really what’s behind this.
MR. GEITHNER: That’s not what’s behind this. I’ve read that. I’ve heard that. But the president asked us to work on this going back several weeks. We’ve provided these recommendations to him two weeks ago. And again, the timing is driven by the fact that we’re at this moment in this very important cause we’re fighting, which is to get financial reform through this next stage of the process in the Senate.

The New Bank Proposal

January 21, 2010, 12:15 pm

By CATHERINE RAMPELL

Here’s the full text of the White House’s news release on its (new) bank proposal:

Office of the Press Secretary
For Immediate Release
January 21, 2010
President Obama Calls for New Restrictions on Size and Scope of Financial Institutions to Rein in Excesses and Protect Taxpayers

WASHINGTON, DC — President Obama joined Paul Volcker, former chairman of the Federal Reserve; Bill Donaldson, former chairman of the Securities and Exchange Commission; Congressman Barney Frank, House Financial Services Chairman; Senator Chris Dodd, Chairman of the Banking Committee and the President’s economic team to call for new restrictions on the size and scope of banks and other financial institutions to rein in excessive risk taking and to protect taxpayers.

The President’s proposal would strengthen the comprehensive financial reform package that is already moving through Congress.

“While the financial system is far stronger today than it was a year one year ago, it is still operating under the exact same rules that led to its near collapse,” said President Barack Obama. “My resolve to reform the system is only strengthened when I see a return to old practices at some of the very firms fighting reform; and when I see record profits at some of the very firms claiming that they cannot lend more to small business, cannot keep credit card rates low, and cannot refund taxpayers for the bailout. It is exactly this kind of irresponsibility that makes clear reform is necessary.”

The proposal would:

1. Limit the Scope — The President and his economic team will work with Congress to ensure that no bank or financial institution that contains a bank will own, invest in or sponsor a hedge fund or a private equity fund, or proprietary trading operations unrelated to serving customers for its own profit.

2. Limit the Size — The President also announced a new proposal to limit the consolidation of our financial sector. The President’s proposal will place broader limits on the excessive growth of the market share of liabilities at the largest financial firms, to supplement existing caps on the market share of deposits.

In the coming weeks, the President will continue to work closely with Chairman Dodd and others to craft a strong, comprehensive financial reform bill that puts in place common sense rules of the road and robust safeguards for the benefit of consumers, closes loopholes, and ends the mentality of “Too Big to Fail.” Chairman Barney Frank’s financial reform legislation, which passed the House in December, laid the groundwork for this policy by authorizing regulators to restrict or prohibit large firms from engaging in excessively risky activities.

As part of the previously announced reform program, the proposals announced today will help put an end to the risky practices that contributed significantly to the financial crisis.