The NYTreports that President Obama has indeed chosen Sen. Judd Gregg (R-NH) for Commerce Secretary, but got nothing for it:
The Democratic governor with the power to fill the Senate seat signals that he will leave it in Republican hands, depriving his party of a chance to reach 60 votes, a magic number when it comes to passing legislation.
Since his election as RNC Chairman last Friday, Michael Steele has been on a public relations offensive. His first order of business: urge his colleagues on Capitol Hill to reject President Obama’s economic recovery plan. “The goose egg that you laid on the president’s desk was just beautiful. Absolutely beautiful,” Steele told a group of GOPers this weekend, referring to the fact that no House Republicans voted for the plan last week.
As the bill moves to the Senate, Steele is upping his game. Trying to convince his Senate colleagues to obstruct the recovery package, Steele is arguing that the bill will not create jobs. In fact, a new talking point has emerged from Steele’s rhetoric — that no government, local, state or federal, has ever created a job. He made this bizarre claim over the weekend, and repeated it again today on CNN:
STEELE: And first off the government doesn’t create jobs. Let’s get this notion out of our heads that the government creates jobs. Not in the history of mankind has the government ever created a job. Small business owners do, small enterprises do. Not the government. When the government contract runs out, that job goes away. That’s what we’re talking about here and those 2 to 4 million jobs that are projected? Won’t happen, trust me.
However, Steele doesn’t seem to be on message — with himself. Just this morning on NPR, he ackowledged the recovery package “will create several hundred thousand at best.” But Steele’s “none, ever” talking point is beyond absurd. As Brian Beutler pointed out, Steele was employed by the government of Maryland when he was Lt. Governor there. “As were his staff members,” Beutler noted, adding, “As are, say, the 1.5 million or so active personnel in the Unite States armed forces. And so on and so on.”
And aside from noting the myriad government sponsored job creation programs starting from at least the New Deal era, CBO estimates that the recovery plan as passed in the House last week will create up to 3.6 million jobs by the end of next year (Mark Zandi, chief economist at Moody’s Economy.com, says 3 million). Moreover, an analysis by the Center for American Progress Action Fund found that infrastructure investment — which makes up a large part of the bill — creates more than 60,000 jobs for every $10 billion spent.
We understand Steele is new on the job, but he should try to get his talking points straight — and at least get them to make sense.
Today, Peter Orszag, the new director of the Office of Management and Budget, appeared on MSNBC to discuss a provision in the stimulus package — proposed by Senate Republicans and supported by some Democrats — that would give a $15,000 tax credit to home-buyers. Orszag said that if he “wanted to get wonky” then he would argue that the credit needs to be targeted better:
If I wanted to get wonky, I would say it’s better targeted when it’s for first time home-buyers. If it’s for all home-buyers, you’re both inducing new sales, but then you’re creating — when someone already owns a house, they’re selling a house and then buying one. That doesn’t do as much for net demand for housing as inducing more first-time home-buyers would do.
At the end of Orszag’s answer, MSNBC’s anchor announced that “wonk is welcome here!” For obvious reasons, we wholeheartedly support that sentiment.
Orszag’s point about targeting, though, is very important. While his suggested target for the credit is a good start, it could go a step further and be targeted only to first time home-buyers who are buying an already existing home. As Matthew Yglesias noted, falling real estate prices have “everything to do with the fact that we’ve built too many buildings.” If the home-buyer credit leads to a reinvigorated construction boom, while finished homes continue to sit empty, then it won’t be increasing demand in a way that’s productive.
Ultimately, this is not a great tax credit, as it is not likely to incentivize many people who weren’t planning on buying a home anyway. But if it’s to be included, it should be targeted at the “blight of empty, poorly maintained and often vandalized houses that sorely need new owners,” thus maximizing its effectiveness as economic stimulus.
While much of the attention on Rush Limbaugh has focused on his stated desire to see President Obama fail, he has also been going around trying to secure President Bush’s legacy. Yesterday, for example, he appeared on Fox’s Hannity’s America and tried to argue that Bush wasn’t at all partisan:
RUSH: Well, I think he’s a decent man. He’s a – he had a reverence for the office, that’s why he didn’t get partisan. He thought it was irreverent to turn the Oval Office, or the Office of the Presidency, into a partisan strategic battle place. [...]
Yes, you know, domestic policy, he did some things that puzzled us – creating a new entitlement, the whole immigration thing, signing campaign finance reform. But he’s a good man. He’s not hated.
The Washington Post ran a very good article on electric vehicles (EVs) Saturday. I recommend it to anyone who wants an overview of the important issue of where American companies will source their batteries. The article notes:
GM plans on a battery pack big enough to last 40 miles, at which point a small gasoline engine will take over. Some rival companies are considering a smaller battery pack that might go only 20 miles, still enough to serve the needs of many local commuters without adding as much weight and cost.
Like pretty much all recent articles on EVs, it highlighted the uber-marketers of the EV world:
Shai Agassi, the chief executive of Better Place, which is building electric car infrastructure in Israel, Hawaii, Northern California and several other places, thinks electric cars should have batteries only. He proposes setting up swap stations where motorists on long trips could exchange a depleted battery for one fully charged.
“We just don’t think that the answer to how to extend the battery is to put a power plant in our trunks,” he said.
I recently asked my EV wonk friends what they thought of the battery swap out model, and I will reprint some of their answers below. I have never actually found anyone who thought it was a viable idea. Where, for instance, would it be done? Sunday’s NY Timesasserts:
She aggressively framed health reform as a response to the fiscal crisis. Every one percent drop in employment means 1.1 million more uninsured, larger Medicaid rolls, more people relying on COBRA as transitional insurance. She divided the stimulus spending into multiple parts. The first part she called “protection policies” to deal with that displacement: More money for COBRA and Medicaid. Allow unemployed adults to buy into Medicaid for one year (why only one year?).
The next set of policies are being framed as job creation. This includes workforce training programs, money for health IT adoption, money for prevention, and money for comparative effectiveness research. She noted that a Kaiser Family Foundation poll showed a solid majority of Americans saying the recession makes health reform more, not less, urgent. She also mentioned a study showing that half of families in foreclosure pointed to medical debt as a partial cause.
Reading the tea-leaves about the probability of comprehensive health care reform has been rather difficult. Reps. JamesClyburn (D-SC), Henry Waxman (D-CA), and Pete Stark (D-CA) have voiced conflicting opinions on the probability of imminent reform and on Friday, Matt Yglesias noted that Ron Pollack, the President and CEO of Families USA, and a man with his ear close to the ground, has his own doubts about whether reform will actually happen. Pollack told a group of bloggers at his Health Action Conference, “it’s unclear if the president and key leadership in Congress are prepared to move on health care reform. There are real temptations to do something else earlier. Things like balancing the budget…”
Such temptations may spell doom to health reform efforts. As David Blumenthal and Paul Begala both noted at the very same event, health care reform must be done early, if it is to be done at all. The President needs to override the innate caution and concern of economists — or the other nay-sayers who may be asking Obama, ‘do you really want to hang your entire first term on risky health reform?’ — and use the presidential bully pulpit to mobilize public support for reform.
This is what Obama’s health team seems to be doing. By adopting the econ-health framework, Obama seems to be suggesting that the two issues need to be dealt with simultaneously. Moreover, Obama’s support for Tom Daschle, despite his tax problems, suggests that Obama may be on the reform-now bandwagon for the long haul.
The Health Blog quotes Lambrew as saying: “The current economic crisis has really highlighted the problems and put them under fluorescent lights.”
Senator Judd Gregg and New Hampshire’s Democratic Gov. John Lynch have both confirmed what has been much discussed over the last several days: Gregg has made it clear that he would only accept an appointment to the Obama Administration if it would not cause the Democrats to gain his Senate seat….
Gregg issued his own statement, making the point even clearer: “I have made it clear to the Senate Leadership on both sides of the aisle and to the governor that I would not leave the Senate if I felt my departure would cause a change in the makeup of the Senate. The Senate Leadership, both Democratic and Republican, and the Governor understand this concern and I appreciate their consideration of this position.”
Surely Gregg’s desire to replace himself with somebody who will often oppose his new boss’s agenda is evidence of his deep commitment to the administration, the cabinet, and the agency he appears poised to head.
Last week, the House passed its version of the economic recovery package, despite unanimous Republican opposition. Minority Whip Eric Cantor (R-VA) wrote in an op-ed for Politico that the caucus had a “duty” to reject economic ideas that they believe are unlikely to lead to economic recovery:
We must speak out when we think the president’s party has erred, as when House Democrats added hundreds of billions in unnecessary discretionary spending to the stimulus that will do nothing to create jobs.
As the Hill reports today, Cantor designed a nuanced opposition strategy that gave centrist House republicans a chance to appear in favor of the Obama recovery package (by first voting in favor of adding discretionary spending to the bill in a failed procedural motion), while still scoring political points with their more conservative Republican leadership (by voting against final passage of the bill):
[Cantor] helped convince about a dozen of his colleagues to reject the Democrats’ bill after appeasing the conservative Republican Study Committee (RSC) and giving some centrists political cover on infrastructure spending, according to Republican lawmakers who requested anonymity. [...]
[C]entrist GOP legislators, along with other Republicans representing districts especially hard hit by the economic downturn, said they needed to be on record backing increased funding for infrastructure programs.
Republican leaders responded, embracing a motion-to-recommit measure investing an additional $36 billion in highways and an additional $24 billion in the Army Corps of Engineers construction, while reducing the overall costs of the bill by nearly $104 billion. Most Republican members…voted for the motion to recommit, which failed 159-270.
And now, several moderate Republican members are “hinting” that they will ultimately “vote for the merged House-Senate legislation.” Among the members who are reportedly likely to ultimately support the stimulus package are Reps. Peter King (R-NY), John McHugh (R-NY), Joseph Cao (R-LA), and Jim Gerlach (R-PA).
Years ago, the Southern Montana Generation and Transmission Cooperative introduced plans to build the Highwood Generating coal-fired plant to satisfy the electricity needs of Great Falls, Montana. Today, CEO Tim Gregori announced “they are changing construction plans from a coal-fired facility to a natural gas and high wind producing plant.” This switch will dramatically reduce the pollution footprint of the facility, from soot to greenhouse gases, and will take less time to get up and running. Montana Environmental Information Center Program Director, Anne Hedges, announced, “This is a relief“:
It’s a relief to the land owners adjacent to the plant. It is a relief to people across the state and across the nation who are concerned about the direction of our climate.
MEIC, Citizens for Clean Energy, Earthjustice, and Sierra Club’s Move Beyond Coal campaign worked together for years to challenge the Highwood plant on its environmental impact, including its mercury and particulate matter pollution. The utility also recognized that the global warming emissions of coal give the fuel an “aura of uncertainty” — in other words, a large economic risk, as has been pointed out repeatedly by economic analysts. It no longer makes environmental nor economic sense to rely on 19th-century technology to power a 21st-century America.
Some Pentagon officials and congressional conservatives are already trying to portray the OMB number as a cut by comparing it to a $584 billion draft fiscal 2010 budget request compiled last fall by the Joint Chiefs of Staff.
The $527 billion figure is “what the Bush people thought was the right number last February and that’s the number we’re going with,” said the OMB official, who declined to be identified. “The Joint Chiefs did that to lay down a marker for the incoming administration that was unrealistic. It’s more of a wish list than anything else.”
Defense budget experts have said the draft by the Joint Chiefs, which was never publicly released, was designed to pressure the Obama administration to drastically increase defense spending or be forced to defend a reluctance to do so.
Chris Bowers notes, “While it is disappointing that the Obama administration is not looking to cut the defense budget during its first year in office, generally speaking this does not seem like a year when spending of any sort is being cut.”