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Health

GM Pushes UAW To Accept More Health Care Concessions

gm.jpgThe New York Times leads this morning with word that General Motors– which is busily restructuring itself to “justify its use of a $13.4 billion loan package from the federal government” — is pushing the United Auto Workers (UAW) to accept serious concessions on retiree health care benefits:

G.M. has the most at stake with the U.A.W. Its future obligations for retiree health care are estimated at $47 billion, and by next year it is required by its contract to contribute more than $10 billion to the trust set up in 2007.

The company, which nearly ran out of money before receiving the first $9.4 billion of its $13.4 billion in late December, is pressing the U.A.W. to accept stock for as much as 50 percent of its next contribution to the trust, according to two people knowledgeable about the discussions.

Recall that in 2007, GM struck a deal with the union to remove $51 billion of retiree health obligations from its balance sheet by contributing to a new trust fund for retiree health benefits. In return, the union got “to set and manage the health-insurance benefits.” Now, the company seems to be balking its commitment, pressing auto workers “to accept stock for as much as half of its next contribution to the trust.” On Saturday, the UAW called proposals to modify a union-run health care fund “a non-starter.”

Indeed, GM’s so-called compromise jeopardizes the future of the trust and may force the labor union to shoulder more of the cost or cut back on health benefits. As Phyllis Borzi, a research professor in health policy at the George Washington University pointed out in 2007, “the nature of GM’s contributions is almost as important as the size.” As an employee, “I would want cold hard cash — I don’t want any employer stock or any of that stuff in there,” Borzi said.

Update

NYT: The U.A.W. said on Tuesday it had reached “understandings” with the Detroit companies on modifications to their contracts. Ron Gettelfinger, the union’s president, said “discussions are continuing” regarding how to fund the health care trusts at each of the companies.


Update

,I asked Phyllis Borzi to comment on the latest developments surrounding GM and the VEBA:

Contributions of employer stock in lieu of cash create an additional layer of volatility for the VEBA trustees to deal with. If the value of the stock declines sharply, the VEBA may have to make up the shortfall over a relatively short period of time in order to continue to pay benefits. Given what we know now, allowing the company to substitute stock for cash will seriously undermine the economic security of the VEBA and the retirees which is, of course, the reason that the UAW is strenuously opposing this.


Update

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Politics

Aerosmith tells Cantor to stop using its music.

House Minority Whip Eric Cantor (R-VA) recently created a YouTube video called “The House GOP is Back,” which was set to the tune of Aerosmith’s “Back In The Saddle” and bragged about conservative opposition to the recovery package. But Stage Three Music, which owns the rights to the Aerosmith song, has objected to Cantor’s use of the song. TPM reports:

aerosmith235.jpgCantor’s clip has been pulled from YouTube after a copyright infringement claim made by Stage Three Music, which owns the rights to “Back in the Saddle.” The GOP’s use of the tune “was something we, as the publishers, didn’t approve and would not have approved without going to the writers,” Connie Ashton, director of copyright and licensing at Stage Three, told me. “Aerosmith did not approve of its use and also wanted to have it taken down,” she added.

Ashton said that House Republicans never contacted Stage Three to request use of “Back in the Saddle.”

Economy

Keith Epstein: Banking Industry Lobbying Against Mortgage Cram-Downs ‘Right Now, As We Speak’

Today, BusinessWeek correspondent Keith Epstein explained that the banking industry is lobbying the Senate to narrow the scope of proposed mortgage “cram-downs” — a bankruptcy reform that would allow judges to “cram-down” mortgage payments for troubled homeowners:

There still is activity right now, as we speak, really focused in some ways on the Senate and on moderate Democrats, such as Evan Bayh in the Senate, to try to lessen the impact of what’s coming. The industry pretty much accepts that cram-down is coming…The work is now focused on trying to limit the number of people whose loans will be eligible for that.

Watch it:

This is an important development, because mortgage cram-downs will potentially be a key part of a new housing plan that President Barack Obama will announce tomorrow. As The Wonk Room has noted before, cram-downs are essential to addressing the foreclosure crisis, because they help to get around the problems caused by securitization — the fact that mortgages have been chopped up and sold to investors around the world.

Rampant securitizing means that “the creditors are split into mind-bewildering tranches of differently securitized investors who have no way, or desire, to reach an agreement” to prevent a foreclosure. As US bankruptcy judge Samuel Bufford said, “there’s nobody on the lender side to do the deal unless you [get permission] from investors, and that’s impossible.”

Cram-downs enable judges to cut through all the junk and renegotiate mortgage payments, hopefully enabling more owners to stay in their homes. This — and not banks’ worries about potential losses — should be foremost in the minds of those in Congress that the banking industry is targeting.

Politics

Jindal may reject recovery package money.

jindalnewt.jpgLouisiana faces a possible $2 billion budget shortfall next year, and the state is being hit hard by unemployment. Yet Gov. Bobby Jindal (R), rumored to be a future presidential candidate, said this weekend that he may turn down the roughly $3.8 billion for the state in the economy recovery package, which is expected to create 50,000 jobs:

We’ll have to review each program, each new dollar to make sure that we understand what are the conditions, what are the strings and see whether it’s beneficial for Louisiana to use those dollars,” Jindal said.

Jindal seems to be taking an even harder line than his colleagues, such as Sen. Lindsey Graham (R-SC) and Gov. Mark Sanford (R-SC), who both may accept stimulus money while opposing the stimulus legislation. Jindal is scheduled to give the official GOP response to President Obama’s address next Tuesday.

Media

George Will Loves Recycling

Brad Johnson notes that the core of George Will’s sloppy, error-ridden column on climate change is an almost exact repeat of a tendentious article he wrote in April of 2006. What he had back then was a very misleading account of the “global cooling” controversies of the 1970s. What he seems to have added since then is zero actual knowledge about the issue, but a couple of additional factual errors.

Yglesias

The European Bogeyman

Hendrick Hertzberg has a great item in the latest New Yorker that touches on many points, including the right-wing’s new habit of issuing constant dire warnings that we’re about to plunge into the sort of social democratic dystopia pictured below:

Stockman

After the Senate passed the stimulus, which Sean Hannity, on Fox News, denounced as “the European Socialist Act of 2009,” Mitch McConnell, the Senate Republican leader, pronounced it “a dramatic move in the direction of indeed turning America into Western Europe.” Whether or not greater income equality, better health, and fewer prisons would really be a dystopian nightmare, McConnell’s vision of “the Europeanization of America” has already come true in a way that bears directly on the question of “bipartisanship”: what might be called America’s parliamentary parties have come to resemble their disciplined European counterparts. As recently as the nineteen-sixties, for reasons of history and origins, the Democrats were a stapled-together collection of Southern reactionaries, big-city hacks, and urban and agrarian liberals; the Republicans were a jumble of troglodyte conservatives, Yankee moderates, and the odd progressive. Ideological incoherence made bipartisanship feasible. The post-civil-rights, post-Vietnam realignment, along with the gerrymandered creation of safe districts, has given us—on Capitol Hill, at least—an almost uniformly rightist G.O.P. and a somewhat less uniformly progressive array of Democrats.

In a followup item on his blog, Rick says “[t]he problem is, too many Americans have actually been to Western Europe, and it didn’t scare them.”

I’m not sure this is right. I suspect that only a distinct minority of Americans have been to Europe. What’s more, the minority of Americans who’ve been to Europe are disproportionately drawn from the upper-echelons of the U.S. income distribution. And rich people have it pretty good here in the land of the free. By contrast, take a look at a “bad” neighborhood in Helsinki and compare it to a “transitional” neighborhood in DC—to say nothing of a genuinely down-and-out American ghetto—and it’s almost laughable. But the beneficiaries of something like that aren’t going to Europe. Among what you might call America’s “traveling class,” the European alternative is going to look good to city-loving cosmopolitans (i.e., me and Rick Hertzberg) but pretty bad to your typical businessman. In other words, it just replicates the cultural divide that already exists among the American elite. The people who would be the main beneficiaries of a more social democratic policy dynamic—a couple of non-college parents who could really use some free child care and and guaranteed health care and pension, for example—are relatively unlikely to have personal experience that cuts one way or the other regards to how terrifying Europe is.

Politics

Gingrich Pushes 90s-Era Proposal To Eliminate Capital Gains Taxes As ‘A New, Bold idea’

gingrich.jpgLast week, Newt Gingrich’s American Solutions for Winning the Future rolled out its “12 American Solutions for Jobs & Prosperity” plan, which he calls an “alternative” to President Obama’s economic recovery plan that “isn’t more money for more government, more power for politicians and more make-work for bureaucrats.”

Bill Bennett hosted Gingrich on his radio show today, offering him a forum to push his proposals. During the conversation, Gingrich claimed that solution #8 on his list — eliminating the capital gains tax — was “a new, bold idea”:

GINGRICH: And we have three big things. First, we have zero capital gains. We eliminate the capital gains tax, which is the same as China and Singapore. Second, we go to the Irish corporate tax level, which is 12 and half percent. And third, we make permanent eliminating the death tax, so that small businesses and family-owned businesses aren’t threatened by the IRS when somebody passes away. Let me mention briefly on capital gains, cause it’s a new, bold idea. It’s one that Congressman Paul Ryan of Wisconsin’s been working on.

Listen here:

There is nothing “new” about Gingrich’s idea. In fact, Gingrich has been pushing for it since 1997, when he was Speaker of the House:

Aggressively pushing tax cuts back to the forefront of his political agenda, Speaker Newt Gingrich suggested today that all capital gains and estate taxes be eliminated. He vowed that with or without President Clinton’s support, House Republicans would vote on a tax cut this year.

In September 2008, as the U.S. economy became undeniably weaker, Gingrich again proposed abolishing capital gains taxes, claiming that eliminating them “would cause the stocks held by two-thirds of the American people to soar in value.” But as Center for American Progress Action Fund Vice President for Economic Policy Michael Ettlinger pointed out, “there are, to say the least, flaws in this argument.”

Yglesias

Gerrymandering is Not the Root of All Evil

gerrymander_1.jpg

Richard Cohen has a pretty good column on the folly of thinking you could eliminate partisanship by acting nice, but I worry that he veers into a whole new error by explaining that the whole thing is just due to the way congressional districts are drawn:

Something of the same has prevailed since the inauguration. Congressional Republicans have made a stand on the stimulus package, just as they did on the original bank bailout when they refused to accommodate a president of their own party, George W. Bush. These Republicans are as wrong as wrong can be, and history, I am sure, will mock them, but they were not elected by history, and they are impervious to mockery from the likes of me. They come from conservative districts, and they are voting as their people want them to. That’s partisanship. It is also democracy. [...]

Reality is real. No amount of lofty rhetoric is going to change the way members of Congress are elected. Most of them come from exquisitely gerrymandered districts created by computers that could, if good taste allowed, part the marital bed, separating husband from wife if they were of different political parties. This system created districts that are frequently reliably liberal or conservative. The computer has deleted the middle.

There’s something to this, but it can’t explain the fact that all the House Republicans voted “no.” Nor can it explain the Senate, where many Senators representing states Obama won voted “no.” There’s more to legislative partisanship than manipulation of district boundaries.

Climate Progress

George Will Believes In Recycling

George WillConservative leading light George F. Will recently penned a column claiming global warming is a “hypothetical” calamity. In “Dark Green Doomsayers,” Will attacked Secretary of Energy Steven Chu for discussing a worst-case scenario of California drought caused by the decimation of Sierra snowpack, falsely claiming Chu predicted this will come to pass “no later than 10 years away.” Will also incorrectly claimed that “global sea ice levels now equal those of 1979″ — based on a 45-day-old blog post by Daily Tech’s Michael Asher, one of Marc Morano’s climate denial jokers.

Will’s numerous distortions and outright falsehoods have been well documented by Joe Romm, Nate Silver, Zachary Roth, Brad Plumer, Erza Klein, David Roberts, James Hrynyshyn, Rick Piltz, Steve Benen, Mark Kleiman, and others. They recognized that George Will is recycling already rebutted claims from the lunatic fringe, and offer the excellent suggestion that Washington Post editors should require some minimum level of fact-checking.

But I haven’t seen anyone comment that Will is also recycling his own work, republishing an extended passage from a 2006 column — which Think Progress debunked — almost word for word. Take a look:

“Let Cooler Heads Prevail,” 4/2/2006:

While worrying about Montana’s receding glaciers, Schweitzer, who is 50, should also worry about the fact that when he was 20 he was told to be worried, very worried, about global cooling. Science magazine (Dec. 10, 1976) warned of “extensive Northern Hemisphere glaciation.” Science Digest (February 1973) reported that “the world’s climatologists are agreed” that we must “prepare for the next ice age.” The Christian Science Monitor (“Warning: Earth’s Climate is Changing Faster Than Even Experts Expect,” Aug. 27, 1974) reported that glaciers “have begun to advance,” “growing seasons in England and Scandinavia are getting shorter” and “the North Atlantic is cooling down about as fast as an ocean can cool.” Newsweek agreed (“The Cooling World,” April 28, 1975) that meteorologists “are almost unanimous” that catastrophic famines might result from the global cooling that the New York Times (Sept. 14, 1975) said “may mark the return to another ice age.” The Times (May 21, 1975) also said “a major cooling of the climate is widely considered inevitable” now that it is “well established” that the Northern Hemisphere’s climate “has been getting cooler since about 1950.”

“Dark Green Doomsayers,” 2/15/2009:

In the 1970s, “a major cooling of the planet” was “widely considered inevitable” because it was “well established” that the Northern Hemisphere’s climate “has been getting cooler since about 1950″ (New York Times, May 21, 1975). Although some disputed that the “cooling trend” could result in “a return to another ice age” (the Times, Sept. 14, 1975), others anticipated “a full-blown 10,000-year ice age” involving “extensive Northern Hemisphere glaciation” (Science News, March 1, 1975, and Science magazine, Dec. 10, 1976, respectively). The “continued rapid cooling of the Earth” (Global Ecology, 1971) meant that “a new ice age must now stand alongside nuclear war as a likely source of wholesale death and misery” (International Wildlife, July 1975). “The world’s climatologists are agreed” that we must “prepare for the next ice age” (Science Digest, February 1973). Because of “ominous signs” that “the Earth’s climate seems to be cooling down,” meteorologists were “almost unanimous” that “the trend will reduce agricultural productivity for the rest of the century,” perhaps triggering catastrophic famines (Newsweek cover story, “The Cooling World,” April 28, 1975). Armadillos were fleeing south from Nebraska, heat-seeking snails were retreating from Central European forests, the North Atlantic was “cooling down about as fast as an ocean can cool,” glaciers had “begun to advance” and “growing seasons in England and Scandinavia are getting shorter” (Christian Science Monitor, Aug. 27, 1974).

Will’s critics should recognize his recycling of old content is an admirable way to reduce waste and limit the production of hot air.

Update

Ezra Klein points out that George Will’s been recycling this content since 2004. From “Global Warming? Hot Air” (12/23/2004):

One of the good guys in “State of Fear” cites Montaigne’s axiom: “Nothing is so firmly believed as that which least is known.” Which is why 30 years ago the fashionable panic was about global cooling. The New York Times (Aug. 14, 1975) reported “many signs” that “Earth may be heading for another ice age.” Science magazine (Dec. 10, 1976) warned about “extensive Northern Hemisphere glaciation.” “Continued rapid cooling of the Earth” (Global Ecology, 1971) could herald “a full-blown 10,000-year ice age” (Science, March 1, 1975). The Christian Science Monitor reported (Aug. 27, 1974) that Nebraska’s armadillos were retreating south from the cooling.

Politics

Obama approves deployment of more than 10,000 troops to Afghanistan.

ap081201034477.jpg This afternoon, the White House released a statement by President Obama announcing the deployment of additional troops to Afghanistan. Noting that the “situation in Afghanistan and Pakistan demands urgent attention and swift action,” Obama said that he “approved a request from Secretary Gates to deploy a Marine Expeditionary Brigade later this spring and an Army Stryker Brigade and the enabling forces necessary to support them later this summer.” Various media outlets are reporting that he will be sending roughly 12,000 troops to Afghanistan. The Progress Report has more on the challenges remaining in Afghanistan.

Obama’s full statement below: Read more

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