A few weeks back, we noted that the stress tests being performed on the nation’s largest banks may amount to a papering over of the banking system’s ills. Today, the Associated Press released Federal Reserve documents showing that this suspicion may be accurate, as the tests “take a harsher view of loans than of other troubled assets,” which is an approach that favors the Wall Street banks grappling with securitized assets:

The regulators’ focus could spell trouble for big regional banks undergoing the tests. Their portfolios have more individual loans and fewer of the big pools of securitized loans that Wall Street giants specialize in. Some analysts said regulators are favoring the largest banks because if even one failed that would pose a severe economic risk. Banks that deal in securities are more interconnected to other corners of the global financial system.

John Carney at Clusterstock wrote that “if this allegation is true, it means the government is willing to use the stress test as a cosmetic aid to banks holding toxic assets.” And with the International Monetary Fund confirming today that the US economy is staring down $2.7 trillion in toxic assets, cosmetic aids are surely not going to be enough to salvage the banking system.

The Obama administration, guided by Education Secretary Arne Duncan, has come out in favor of mayoral control of urban education. This centralizes education policy for a city in the mayor’s office, instead of leaving it to the city’s school board, city council, and superintendent, who often can’t agree on a single policy direction.

“At the end of my tenure, if only seven mayors are in control, I think I will have failed,” Duncan said last week. “And given the fact so few cities have mayoral control, that’s a huge impediment that hasn’t been talked about enough.”

One of the foremost proponents of mayoral control is New York City Mayor Michael Bloomberg, who was given control over the city’s education policy seven years ago. Today, The Wonk Room sat down with Mayor Bloomberg, to discuss the effect that this move has had on New York City schools:

I can just tell you that before we had mayoral control it was disaster. [...] I know of no thing that we’ve done that would have been remotely possible under the old system and any mayor that has a school system that is getting better, I think, will tell you the exact same thing…The school systems should not be run as patronage mills and they should not be run for the benefit of the people who work in them…And when you have these school boards that are fundamentally controlled by special interests, the truth of the matter is the students come last, if at all.

Watch it:

According to Kenneth Wong, a Brown University professor who studies the issue, mayoral control is worth considering in about 400 of the biggest school districts. “The way I look at it is, we are talking about real accountability,” Wong said. “A lot of urban school systems are playing this game of blaming one another — the superintendent blames the school board; the school board blames the union. With the mayor in charge, there ultimately is one single official held accountable every four years.”

Currently, just seven cities have adopted full mayoral control of education, but its a system worth experimenting with, instead of relying upon a patchwork of policymakers to institute reform. Hopefully, a mayor can cut through the bureaucracy to compel a change in direction, and if that effort is unsuccessful, voters will have the chance to designate a new point person.

Unless we act now, we might lose the race to the clean energy economy of the future.

A new report from the Center for American Progress points out that the United States is slipping behind other nations in the development and deployment of clean energy and efficient infrastructure even as China spends $12.6 million every hour greening their economy.

Read the full study here.

China, as part of their two-year stimulus plan, is poised to spend 3% of their GDP a year on public investments in renewable energy, low-carbon vehicles, high-speed rail, an advanced electric grid, efficiency improvements, and other water-treatment and pollution controls. This is about $12.6 million every hour. In the United States, the American Recovery and Reinvestment Act invests about half as much as China on comparable priorities. This represents less than half of one percent of our 2008 gross domestic product.

The paper also shows that, when it comes to preparing our country to compete in the new energy economy of the future and create millions of new jobs, the United States lags behind most of our competitors in the rest of the world in a four key ways.

–We have no national energy portfolio standard that encourages clean, renewable power and shifts away from dirty and dangerous energy.

–We have an outdated electrical grid unsuited for the task of carrying energy from regions rich in wind, solar, and geothermal potential to the people who need the energy.

–We don’t make dirty energy companies pay for the pollution they pump into the air; in fact, we give them billions every year in tax breaks.

–And we don’t invest enough in research, development, and deployment to inspire our entrepreneurs and leverage their discoveries by helping bring their bold new technologies to market.

As venture capitalist John Doerr recently pointed out in his testimony before the Senate Committee on the Environment and Public Works, “What is at stake is whether America will be the worldwide winner in the next great global industry, green technologies.”