The millionaire CEO of foreign oil giant BP, Tony Hayward, is upset at the inconvenience caused to him by his company’s devastation of the Gulf of Mexico. BP’s offshore drilling explosion claimed 11 lives on April 20, and has since spewed 20 to 100 million gallons of oil into the Gulf. At least 491 birds, 227 turtles and 27 mammals, including dolphins, have been found dead. On Sunday, immediately after apologizing, Hayward then complained about the effect of the Deepwater Horizon disaster on his personal life, saying “I would like my life back“:

We’re sorry for the massive disruption it’s caused their lives. There’s no one who wants this over more than I do. I would like my life back.

Watch it:

Hayward, who pulled in $4.5 million last year, has a record of insensitive comments about the greatest environmental disaster in the United States:

“What the hell did we do to deserve this?” [New York Times, 4/30/10]

“The Gulf of Mexico is a very big ocean. The amount of volume of oil and dispersant we are putting into it is tiny in relation to the total water volume.” [Guardian, 5/14/10]

“I think the environmental impact of this disaster is likely to be very, very modest.” [Sky News, 5/18/10]

There are no indications that the Obama administration intends to remove Hayward or his company from running the cleanup effort, however. “I trust Tony Hayward,” Admiral Thad Allen, the top federal official overseeing the Gulf disaster, told CNN last week.

Hard as it may be for Hayward to believe, the residents of the Louisiana coast may want their nightmare to end even more than BP. “I was just sitting here thinking our way of life is over. It’s the end, the apocalypse,” fisherman Tom Young of Plaquemines Parish told reporters today. (HT Eschaton)

The latest attempt by BP to shut down its apocalyptic oil gusher — the “top kill” maneuver — has failed, despite BP CEO Tony Hayward’s assurance yesterday that it had a 70 percent chance of success. There’s no question that the federal government, if the president so decides, can take over the challenge of mitigating the damage of BP’s oil to the shores and waters of the Gulf of Mexico. But can President Obama take charge of stopping the wellhead gusher from the foreign oil giant? The administration argues it’s keeping BP in charge of the attempts to shut down the blown out well because government doesn’t have the equipment or expertise to solve this engineering problem without BP:

Adm. Thad Allen, Incident Commander: “To push BP out of the way, it would raise the question, to replace them with what?” [White House briefing, 5/24/10]

David Axelrod, White House adviser: “They’ve got equipment that our government doesn’t have.” [Fox News, 5/24/10]

Ken Salazar, Secretary of the Interior: “This administration has done everything we can possibly do to make sure that we push BP to stop the spill and to contain the impact. We have also been very clear that there are areas where BP and the private sector are the ones who must continue to lead the efforts with government oversight, such as the deployment of private sector technology 5,000 feet below the ocean’s surface to kill the well.” [White House briefing, 5/24/10]

The administration has been keeping an ecological criminal in charge of the crime scene during a national crisis. Seventeen nations have offered assistance — but “the final decision is up to BP” to accept it, according to the State Department — and only Canada, Mexico and Norway have been allowed to help so far. The law — Title 33, Section 1321 — mandates that President Obama “shall direct all Federal, State, and private actions to remove the discharge,” using any means necessary. There are not any resources — people or equipment — that Obama doesn’t have the authority to seize and put into service.

It’s certainly fair to expect that private sector resources may be needed for this disaster, but BP’s only unique qualification for the disaster response is that it is the perpetrator. Although BP is by default a party responsible for implementing the cleanup plan, it is by no means the only possibility. The rig was operated by Transocean; the cementing done by Halliburton; the blowout preventer built by Cameron. Other companies involved in ultra-deepwater drilling include engineering giant Schlumberger, Norway’s nationalized oil company Statoil, Shell, and Chevron.

If the Navy can’t direct the undersea mission after it’s given authority over any needed private resources, it calls into question why we entrust it to operate aircraft carriers and nuclear-armed, nuclear-powered submarines.

Obama does not need to keep working with BP management — like CEO Tony “Very Very Modest” Hayward, BP America president Lamar “No Certainty” McKay, BP Chairman Carl-Henric “Big And Important” Svanberg, or COO Doug “Very Optimistic” Suttles — who have repeatedly laughed off the scale of this catastrophe. If federal officials believe that BP engineers should continue to work on the problem, the President has the authority to have those people working directly for the federal government.

In fact, the president has the authority to nationalize BP America and seize all of its assets, rendering the question of reliance on BP moot. If Obama does not believe that the Clean Water Act’s “spill of national significance” provisions give him sufficient authority, he can rightly declare a national emergency, or demand that Congress deliver him necessary legislation. Or there’s an easier option: BP is on the hook for all costs of this apocalyptic disaster. Obama can simply buy BP America and send the bill to its foreign parent company.

Cross-posted on the Wonk Room.

Numerous politicians and oil industry officials have claimed the BP oil catastrophe growing in the Gulf of Mexico is “unprecedented.” From BP CEO Tony Hayward, who called his company’s environmental crime an “unprecedented accident,” to Admiral Thad Allen, U.S. Coast Guard, who called it an “unprecedented anomalous event,” officials and pundits have given the impression that the consequences of this catastrophe could not have been predicted. In a Congressional oversight hearing on the apocalyptic disaster on Thursday, Rep. Doc Hastings (R-WA) even argued the country should respond to this “unprecedented” event by making sure “that we continue to produce oil here in the states.”

Watch a compilation prepared by ThinkProgress:

On Thursday, May 27, Rep. George Miller (D-CA) responded to the myth that this catastrophe was unprecedented and thus unforeseeable:

Every time we have a catastrophic event like this involving British Petroleum or other parts of the oil and gas industry, we’re told that this is an unpredictable cascade of unforeseeable errors, that this is unprecedented, that nobody could have foreseen this. This is sort of like the bankers on Wall Street. Nobody could have foreseen the risks that they engineered themselves, so nobody’s responsible. I don’t believe this was some “black swan” or “perfect storm” event. There wasn’t something that could not have been foreseen. And I don’t think this is something you can promise will never happen again.

Like the rest of the oil industry, BP has a long record of tragic, extraordinary environmental disasters, stretching from Alaska to Nigeria. And this particular disaster is not unprecedented in size, in the kind of accident, nor in the methods used to respond. There have been dozens of oil well blowouts in the Gulf of Mexico, including 39 since 2007, and the worst oil blowout in history in 1979. What makes this catastrophe new is its location in the fertile and fragile ecosystem of the northern Gulf, and the depth at which the well was drilled, increasing the dangers. But this event is yet another tragic reminder of the truth of George Santayana’s dire maxim: “Those who cannot remember the past are condemned to repeat it.”

Cross-posted on the Wonk Room.

According to a USA Today analysis that came out earlier this month, Americans paid their lowest share in taxes in nearly sixty years in 2009. At the same time, as this year’s annual Economic Report of the President pointed out, “in recent years nearly half of all income — including both wages and salaries and nonlabor income — has gone to 10 percent of families.” “The top 1 percent of families now receive nearly 25 percent of income, up from less than 10 percent in the 1970s,” the report said.

Given that income concentration has gotten more and more severe recently and that the country has to be proactive in addressing its long-term deficits, it makes sense to increase taxes on those at the top of the income scale. And evidently, Secretary of State Hillary Clinton agrees. Speaking at the Brookings Institution yesterday, Clinton said that, particularly with the high unemployment the country is facing, “the rich are not paying their fair share” in taxes:

“The rich are not paying their fair share in any nation that is facing the kind of employment issues (the United States is), whether it’s individual, corporate, whatever the taxation forms are,” she said…“Brazil has the highest tax-to-GDP rate in the Western Hemisphere and guess what — it’s growing like crazy. And the rich are getting richer, but they’re pulling people out of poverty,” she said. “There is a certain formula there that used to work for us until we abandoned it, to our regret in my opinion.”

Clinton made sure to emphasize that “I’m not speaking for the administration, so I’ll preface that with a very clear caveat.”

Speaking of taxing the rich, the Senate, when it comes back from the Memorial Day recess, will contend with an extenders bill passed by the House today. One of the ways in which the bill’s spending is partially offset is by closing a tax loophole that allows wealthy hedge fund and private equity managers to pay the lower capital gains rate on the income they receive from the investors whose money they manage, instead of paying standard income tax rates.

As I’ve explained before, it’s simply unjustifiable to let this loophole stay in place, as it allows money managers who regularly make hundreds of millions annually to pay lower tax rates than people who make far less money, for no good reason. Here’s an illustration of the situation that the loophole allows:

At this point, simple revenue raisers that only affect the super-wealthy should be embraced with ease. But of course, that’s not the case, and Congress is twisting itself into knots to mitigate the tax increase, suggesting various ways to carve out certain people or subject only a portion of their income to the higher tax. But Clinton is right. The country needs to find places to raise revenues, and leaving loopholes in place that allow the ultra-wealthy to pay lower taxes than their secretaries is simply not fair.

Today, after spending the last few days running around in an effort to scrounge up enough support, the House of Representatives plans to vote on an extenders bill that, among its many provisions, extends unemployment benefits through the end of November.

The final bill is a scaled down version of the original legislation, which extended jobless benefits through the end of the year and included Medicaid assistance to states and expanded COBRA health insurance subsidies for jobless workers. But those were jettisoned in the desperate quest for votes, thus making the bill cheaper.

However, the House did manage, in a separate bill authorizing the Defense Department for 2011, to approve funding for a second engine for the F-35 fighter that both the Pentagon and the White House have said is a big waste of money:

The House of Representatives, defying the Pentagon for a fourth straight year and a presidential veto threat, voted to preserve a second engine program for the multinational F-35 fighter jet…The House would provide $485 million next year to continue work on the engine being built by a joint venture of General Electric Co and Rolls-Royce Group Plc.

An amendment stripping the engine funding from the defense authorization bill, which is also slated for final passage today, failed by a 193-231 vote.

Defense Secretary Robert Gates called the second engine “costly and unnecessary,” adding that “every dollar additional to the budget that we have to put into the F-35 is a dollar taken from something else that the troops may need.” Gates has repeatedly recommended that Obama veto the defense spending bill if it includes the engine funding. Obama himself has said, “think about it: hundreds of millions of dollars for an alternate second engine for the Joint Strike Fighter when one reliable engine will do just fine.”

Can you imagine another agency coming before Congress, expressly asking that a particular program be cut because its unnecessary, and having that request denied? It’s a completely absurd situation. To its credit, the Senate Armed Services Committee refused to fund the second engine, but proponents of the program are already pushing for it to remain alive in conference committee.

Meanwhile, with the unemployment rate at 9.9 percent and long-term unemployment at a record high, it’s a Herculean effort to get Congress to extend unemployment benefits. And COBRA subsidies are cast aside due to cost concerns. In fact, we’ve seen repeated filibusters of jobless benefit extensions that were characterized as costing too much.

The Senate is already planning to leave for the Memorial Day break without approving an extension, meaning that 1.2 million workers will see their jobless benefits expire this weekend. And money for a fighter engine that the Pentagon neither wants or needs continues to flow.

Yesterday, President Obama’s debt commission held its second public meeting, as it works to come up with a recommendation for Congress to vote on by December. And evidently the right-wing is extremely concerned that the commission will propose some tax increases, because it is pushing Sen. Orrin Hatch (R-UT) to preemptively rule tax increases off the table. Hatch is slated to become the Senate Finance Committee’s ranking member next year, so he will have significant input over any tax bill that makes it way before Congress.

And Hatch, who is sprinting ever further to the right in the face of a potential 2012 primary challenge from Rep. Jason Chaffetz (R-UT), played right along:

“Everybody knows I’m a tax cutter and not a tax increaser, so the odds are that I probably couldn’t support something that would increase taxes, especially given the amount of spending going on,” said Hatch.

“We’d like to get a commitment from all Republicans on the Finance panel to oppose new taxes,” said Andrew Roth, vice president for government affairs for the far right-wing, anti-tax crusading Club for Growth. “It would be political suicide for Orrin Hatch to not do so.”

As Ali Frick pointed out, this shows that “conservatives don’t actually want to take action to reduce the deficit.” Indeed, it’s just one more indication of the pure deficit peacockery that is prevalent on the right, wherein there is much consternation and fearmongering about deficits, but responsible solutions for addressing them are dismissed out of hand.

It’s the simple truth that the country’s long-term deficits cannot be brought down without a reasonable mix of spending cuts and tax increases. As Michael Linden and Michael Ettlinger found, excepting debt obligations and benefits for current Social Security beneficiaries, the entire rest of the budget would have to be cut by almost 30 percent to eliminate the deficit by 2014. That’s 30 percent of everything: defense, child care, veteran’s benefits, you name it.

And there are Republicans out there who get it: just none of them have to face the wrath of the Club for Growth. Former GOP Senator Alan Simpson, who co-chairs the deficit commission, has “dismissed claims from Republicans that reining in deficits would be easy or accomplished with spending cuts alone.” “To say that all we have to do is take care of waste, fraud and abuse, and foreign aid is a like a sparrow’s belch in the midst of typhoon,” he said. “That is nothing, less than one percent of the budget.”

Former GOP Senator Pete Domenici, meanwhile has said, “I’m sorry that some Republicans think otherwise, but I was there [in the Senate] a long time, and I don’t think you can do spending alone…It’s got to be a package, and – to my way of thinking – it’s got to have taxes on the table.” Former Reagan official Bruce Bartlett put it this way:

Every serious budget analyst — I mean every — knows that revenues must be part of the solution to our deficit problem. We can debate how much and what form higher revenues will take, but the idea that we can or even should embark on serious deficit reduction with no tax increase whatsoever is grossly immature and unworthy of consideration.

Yet that’s exactly what the far right is pushing, with Hatch’s tacit approval.

In the 38 days since British Petroleum’s Deepwater Horizon oil rig exploded, 15 to 40 million gallons of oil have gushed into the Gulf of Mexico, covering sea life, washing onto beaches, and making those working to clean it up ill. And as the days progress, more and more pieces of evidence confirming BP’s gross negligence when it came to safety precautions are coming to light.

However, Rep. Louie Gohmert (R-TX) took to the House floor today to espouse his own unique theory about the cause of the spill. According to Gohmert, it was the simple fact that the oil rig inspector’s are union members:

As we’ve had hearings regarding the oil spill out in the Gulf, there’ve been some staggering things come forward and the media’s not grabbing it like they should and letting everyone know. Who knew that the inspectors inspecting the offshore rigs were unionized. So they had union limits on how many hours and travel and this kind of things. These guys are like the military, they’re out there to protect the environment, and we’re going to put limits on them? They gotta be out there protecting us. And yesterday, Director Birnbaum, when asked ‘what kind of checks and balances do you have?’, she said ‘we sent them out in pairs of two.’ And then I asked ‘then was it a good idea that the last inspection team of two were a unionized father and son team?’…This thing stinks and it needs to be cleaned up.

Watch it:

Now, at least some oil rig inspectors at MMS are, in fact, unionized. But that’s all that Gohmert got right.

MMS’ inspectors were undeniably negligent when it came to inspecting the Deepwater rig. But that negligence had nothing to do with their work rules and everything to do with the fact that, under President Bush, the MMS was bought by the oil industry. According to an inspector general’s report, MMS allowed industry officials “to fill in their own inspection reports in pencil — and then turned them over to the regulators, who traced over them in pen before submitting the reports to the agency.” In exchange, MMS officials received “meals, tickets to sporting events and gifts” from the very industry it was supposed to be regulating.

And of course, who can forget that MMS employees under Bush were “partying, having sex, using drugs and accepting gifts and ski trips and golf outings from energy company representatives with whom they did government business.” This isn’t about work rules. It’s the end-result of a political philosophy based on deregulation and no enforcement of safety laws.

BP itself also cut short safety procedures, skipped quality tests, and appointed inexperienced managers to key positions. The New York Times added today that “several days before the explosion on the Deepwater Horizon oil rig, BP officials chose, partly for financial reasons, to use a type of casing for the well that the company knew was the riskier of two options.”

These choices, as the Wall Street Journal put it, allowed BP to “minimize costly delays,” but they also led directly to the catastrophe in the Gulf. Gohmert is simply grasping at straws in order to direct blame away from the culpable parties.

This week, after Sen. Tom Harkin (D-IA) was unable to muster any Republican support for it in the Senate, Rep. Dave Obey (D-WI) said that he would attach a $23 billion bill aimed at preventing mass teacher layoffs to the House version of the fiscal year 2010 war supplemental. The Senate is currently debating the supplemental, and the House plans to move on it next.

Ever since this proposal for teacher funding started making the rounds, Republicans have been mischaracterizing it as a “bailout,” and the top Republican on the House Appropriations Committee, Rep. Jerry Lewis (R-CA), said that he would push his party to vote against the war supplemental if it included the money for teachers.

Today, Rep. Eric Cantor (R-VA) appeared on Fox News to talk about the effort. (Fox’s Bill Hemmer was a tad confused, and said that the teacher money would be attached to the extenders bill currently before the House, which continues various tax breaks and important social safety net programs, like unemployment insurance.) When asked if he would support the money for teachers, Cantor dismissed the funding because he’s focused on “priorities.” He then poo-pooed the idea of extending unemployment benefits as “a far cry from the original intent” of the program:

Q: Some are pushing in this bill for $23 billion to make sure that teachers are not laid off in certain parts of the country. Education’s important too, as you well know. You wonder if you go ahead and pay for it or force these schools districts to find another place to get the money or cut back. How’s that going over?

CANTOR: Again, it’s assessing priorities. Some of the spending bill that they’re talking about right now is extending unemployment insurance, is extending COBRA insurance. All these things, in tough times, certainly are worthwhile programs. But let’s pay for ‘em…Part of this bill now is extending unemployment insurance to 99 weeks. That’s a far cry from the original intent, just a few years ago, of 26 weeks of unemployment insurance.

Watch it:

Up to 300,000 teachers across the country are facing layoffs, and Cantor’s own state of Virginia is looking at 2,000 layoffs this year. In addition to layoffs, school districts are cutting summer school, moving to four-day school weeks and eliminating caps on class size, all in order to handle draconian budget cuts that have either already been made or are certainly coming if the federal government doesn’t act.

As far as the extension of unemployment benefits, 1.2 million Americans who are currently eligible for extended benefits will have the rug pulled out from under them in June without an extension. Plus, according to the Center for American Progress’ Christian Weller, the average length of unemployment is currently 31.2 weeks, “and 44.1 percent of the unemployed were out of a job for 27 weeks or more.” “This is a new record for long-term unemployment,” he added.

Given that, it makes sense to ensure that all eligible workers receive their benefits. (The extension does not create a new tier of benefits for workers who have exhausted theirs.) But instead, Cantor would rather wax rhetorically about priorities and play with his gimmicky YouCut toy.

Five weeks into the worst environmental catastrophe in the history of the United States, even the right-wing Fox networks are turning on BP, the foreign oil behemoth responsible for the hundred-million-gallon oil gusher now fouling the shores of Louisiana. On Monday, Fox News anchor Shepard Smith challenged top White House adviser David Axelrod why the administration continues to trust BP, whose CEO Tony Hayward bet the disaster will have a “very very modest” impact on the Gulf of Mexico, claimed BP had “contained” the spill, and complained that Americans are too litigious:

And this is the chief executive of the company that’s in charge of cleaning up this disaster now? Who calls us litigious? Who makes comments about the comparative volume of oil and then says the environmental impact is very minimal? And this is the guy we as Americans are supposed to entrust with the largest ecological disaster in American history? Tony Hayward?

On Wednesday, Fox Business Network anchor Liz Claman interviewed John Williams, executive director of the Southern Shrimper Alliance, whose industry is threatened with extinction by the millions of gallons of dispersed oil contaminating the Gulf Coast. Claman noted that “we can’t trust BP”:

I think one thing we do know is that we can’t trust BP with information at this point. They were the ones, absolutely, you’re correct, who said, “Oh, don’t worry, the oil will not reach the beaches.” Oh, come on!

Watch a compilation:

This righteous anger at big oil is a remarkable turnaround for the networks that lied about the oil spills caused by Hurricane Katrina, deny the threat of oil pollution to the planet, and shilled for offshore drilling during the “Drill, Baby, Drill” summer of 2008.

Back in February, Sen. Jon Kyl (R-AZ) threatened to derail an extension of soon-to-expire unemployment benefits if he didn’t receive assurances that the Senate would act on his proposed cut in the estate tax, which would spend hundreds of billions of dollars to reduce tax bills for the richest 0.2 percent of estates in the country. Kyl eventually backed down, but he is at it again, this time with a new target: small business lending.

Yesterday, President Obama called on Congress to pass a $30 billion plan (funded by bailout money that big banks have repaid) that would facilitate lending from community banks to small businesses and also provide them with some tax breaks. Under the plan, “the banks would benefit from a lower interest rate on that capital — as low as 1 percent — if they increase their small business lending by 10 percent over 2009 levels.” Kyl, however, is standing in the way due to his insistence on cutting taxes for multimillionaires:

There was still a chance the Senate Finance Committee would take up an on-again, off-again small-business tax incentive bill in committee this week. Those negotiations have been stymied by Senate Minority Whip Kyl’s insistence on moving an estate tax bill soon, before it gets perilously close to next year’s 55 percent rate and $1 million exemption. He has threatened to offer an estate tax amendment to the small-business bill in committee, while Baucus is working to avert that outcome, which he argues could doom the small-business measure’s chances for bipartisan support.

As a reminder, Kyl wants to institute an estate tax of 35 percent with a $5 million exemption. The estate tax has currently expired, but is scheduled to come back next year at a 55 percent rate with a $1 million exemption, and the House has already approved permanently reinstating the tax at the 2009 level of 45 percent with a $3.5 million exemption. Let’s not forget that it was Kyl who personally scuttled a plan to simply reinstate the estate tax at the 2009 level for this year, which would have given lawmakers more time to come up with a permanent solution.

Kyl’s cut costs more than $300 billion relative to the current budget baseline, and $60 to $80 billion more than permanently extending 2009 law. And Kyl — along with his co-sponsor, Sen. Blanche Lincoln (D-AR) — are looking for spending offsets for that $80 billion, raising the prospect that Congress may actually raise money elsewhere to pay for a tax cut for the very wealthiest estates in the country. The Center on Budget and Policy Priorities has called the Lincoln-Kyl plan “deeply flawed” and “unaffordable.”

Republicans spend lots of time professing their love for small businesses — and falsely claiming that progressive policies will adversely cripple such businesses — but when push comes to shove, Kyl is making it clear where his priorities lie: with the ultra-wealthy.

Back when the economic recovery package (i.e. “the stimulus”) was being debated, a handful of Republican governors garnered headlines by rejecting various portions of the funding. One of the loudest critics of the legislation was Gov. Rick Perry (R-TX).

At the time, Perry said rejecting the money “was pretty simple for us. … We can take care of ourselves.” “I am so concerned about the belief that has gained a foothold in our national consciousness that the best and only way to solve our nation’s problems is to drown them with taxpayer dollars,” Perry also said, adding that, with regard to the stimulus, Texas should “look a gift horse in the mouth.”

The Texas state legislature eventually pushed Perry to accept the money, but even in his official acceptance letter, Perry wrote that “I believe there are better ways to reinvigorate our economy and believe [the bill] will burden future generations with unprecedented levels of debt.” However, as the Wall Street Journal noted this morning, the stimulus is the reason that Texas currently has a balanced budget:

[T]he economic downturn is catching up with Texas. Sales-tax revenue started falling in February 2009 compared with the previous year, and only started to recover a bit in April of this year. Although Mr. Perry has railed against the federal economic-stimulus program, billions of dollars from that initiative helped Texas legislators balance the current budget.

Texas faces an $18 billion shortfall in its next two-year budget, which amounts to 20 percent of the total. And Perry’s refusal to consider tax increases is setting the state up for draconian cuts. “There is no way that they will be able to come up with $18 billion in cuts,” said Eva DeLuna Castro, a senior budget analyst at the Center for Public Policy Priorities. “They would have to shut down our prison system.”

Perry is not the only governor to rail against the stimulus while relying on it to balance his budget. Gov. Tim Pawlenty (R-MN) called the stimulus “incoherent” and “largely wasted,” but still used it to fix one-third of his state’s budget hole.

According to the latest report from the Congressional Budget Office, the stimulus not only helped states stave off budget cuts, but also raised GDP by between 1.7 and 4 percentage points, lowered the unemployment rate by 1.5 percentage points, and created up to 2.8 million jobs. This is 250,000 to 500,000 more jobs than projected. CBO estimates that the stimulus will be responsible for up to 3.7 million jobs by September.

Earlier this month, the Obama administration asked that a $23 billion bill to aid states in preventing mass teacher layoffs be included in the war funding supplemental that the Senate is currently debating, and that the House plans to pick up sometime in the not-too-distant future. Since then, Republicans have been unfairly characterizing it as a “bailout,” with the top Republican on the House Appropriations Committee, Rep. Jerry Lewis (R-CA), saying that he would push his party to vote against the overall bill if it included the money for teachers.

The effort’s main advocate, Sen. Tom Harkin (D-IA), has been searching the Senate for votes. However, since he needed sixty votes to add an amendment to the supplemental and no Republicans agreed to offer their support, he relented. But House Appropriations Chairman David Obey (D-WI) picked up the ball and ran with it:

Unable to find any Republican support, Senate Health, Education, Labor and Pensions Chairman Tom Harkin said today he will not offer an amendment on education jobs funding to the FY10 supplemental bill…Instead, the $23 billion in education money, intended to avert hundreds of thousands of teacher layoffs, will be included in the supplemental package being put together by House Appropriations Chairman David Obey, according to a draft.…Obey will hold a press conference Wednesday about the measure, with House Education and Labor Chairman George Miller and Education Secretary Duncan attending.

Senate Democrats said that they would support keeping the measure in the final supplemental bill negotiated between Congress’ two chambers.

States are projected to cut as many as 300,000 teaching jobs this year, as they grapple with budget deficits that amount to hundreds of billions of dollars in the wake of the Great Recession. Lewis’ own state is looking at more than 20,000 potential layoffs alone. In fact, many states are slashing their education budgets to ribbons across the board. As Harold Myerson pointed out, “a recent American Association of School Administrators survey of 453 school districts in 45 states shows how bad things are”:

One-third of the districts are looking at eliminating summer school this year. Fourteen percent are considering going to four-day weeks (last year, just 2 percent did). Fully 62 percent anticipate increasing class size next year, up from 26 percent in the current school year. The teacher-to-pupil ratio, the AASA says, will rise from 15 to 1 to 17 to 1.

One of the criticisms of the Harkin bill is that a spending offset hadn’t been pinned down, and Harkin suggested designating the money as emergency spending to comply with pay-go rules. But I can think of some oil company subsidies that we could do without, if this is the main thing preventing the bill from passing.

Just this week, the Georgia State Board of Education waived caps on class size, the latest in cost-saving moves across the country that could adversely impact students. In light of this, it seems prudent to at least consider a way to keep teachers teaching and class sizes from expanding out of control. But Senate Republicans couldn’t be bothered.

This morning, Fox & Friends characterized Sen. Bob Casey’s (D-PA) Create Jobs & Save Benefits Act as a “$165 billion bailout” of union pensions. “It has been decades since you’ve seen an administration so prone to the influence of unions as this one is. I’m not going to say this is owned by the unions, but their influence on this administration is simply enormous,” Fox Business Network’s Stuart Varney claimed of the legislation, which is actually designed to partition “specific types of union pensions that are deemed to be insolvent.” Later in the day, the network went after House Republicans for co-sponsoring similar legislation in the House. On America Live with Megyn Kelly, the network showed a chart of the nine Republicans supporting the measure and questioned their sanity.

This didn’t go over well with Rep. Steve LaTourette (R-OH), a co-sponsor of the House measure, who took to the floor this afternoon to criticize Fox for its coverage. “I think as a Republican, I’m supposed to love Fox News and hate MSNBC,” he began. “Now, I’m going to tell you, I do hate MSNBC, but something just happened on Fox News that compelled me to come to the floor”:

LATOURETTE: They’ve run this diagram and it really is a, I think, blaspheming my good friend Pat Tiberi from Ohio and indicating that there are nine Republicans supporting a bill that will bail out unions. Well, that’s nonsense and I don’t know who the pin head and weenie is at Fox News that decided to put that story together. But the true facts of this piece of legislation are as follows. This bill will save the taxpayers by saying to those corporations that have union pension plans, if you find yourselves in a bind, rather than thrusting that upon the taxpayer, it spreads out over five years the ability to bring those pension plans up to speed. That’s good government, it’s a good bill. It’s a good Tiberi bill and I don’t know what they’re doing at Fox News, but they should stop smoking it and get back to reporting the facts.

Watch it:

LaTourette may soon regret his remarks. Last month, Sen. Tom Coburn (R-OK) criticized Fox News for pushing misinformation about health care reform, but later walked back his comments after being confronted by host Neil Cavuto.

The House of Representatives is currently working its way through a bill that extends several popular business tax credits as well as important social safety net provisions like unemployment insurance. But of course, these things cost money, and the bill’s authors — led by Sens. Max Baucus (D-MT) and Rep. Sander Levin (D-MI) — have come up with a series of offsets to partially cover the bill’s cost.

One of these is a change in the taxation of carried interest, or the payment that hedge fund and private equity managers receive for successfully managing other people’s money. Currently, these managers are inexplicably allowed to pay the capital gains rate (which is meant to encourage investment) on money that they receive in exchange for providing a service. It’s as if we taxed the proceeds of a movie that go to its lead actor as capital gains instead of income. Levin and Baucus have suggested that their pay be subject to normal income tax rates.

Of course, CNBC’s talking heads — who never miss an opportunity to defend the right of the wealthy to use tax havens or the sanctity of bonuses for bailed out bankers — are going nuts about the tax increase, led by devout supply-side devotee Larry Kudlow. They’re calling it “one of the five dumbest things in the history of the Earth,” a “job killer,” “mind boggling,” “patently unfair,” and the result of “left-wing social policy.” Watch a compilation:

What’s actually mind boggling is that CNBC’s cast of pundits and anchors thinks it’s entirely appropriate for both a janitor and a hedge fund manager to receive a paycheck, yet have the former be subject to income tax rates and the latter subject to the lower capital gains rate. As Citizens for Tax Justice explained:

The preferential income tax rate for capital gains was created to benefit those who invest their own money. The partnership income that investment managers earn is clearly compensation for services and not a return on investment (except to the extent that they actually have put up their own money — and the treatment of that won’t change). They should pay income taxes at ordinary rates on their compensation, just like everyone else, from the folks who sweep their floors or answer their phones to CEO’s exercising stock options and professional athletes getting playoff bonuses.

CNBC’s gang deploys a lot of rhetoric about innovation and job creation being smothered by the tax, but let’s be clear — investors will not see their taxes go up because of this change. It applies to managers, who are paid to take money from investors and make more money with it. These managers typically receive hundreds of millions — if not billions — annually for their services.

Baucus has said that there’s a “growing sense of inevitability” that the tax change will be adopted and Levin today added that it won’t be taken out of the legislation. “We’ve already worked hard to balance all of the needs, here,” Levin said. “The basic principle is, if it’s your money [at risk] you pay capital gains; if you’re managing other people’s money, essentially you pay ordinary income tax like everybody else.”

Since the disastrous Gulf Coast oil spill, BP and the other companies responsible for the tragedy have been beefing up their lobbying and public relations efforts. Today, the oil giant has full-page ads in the Washington Post, New York Times, Wall Street Journal, and USA Today defending its response to the oil spill. From the ad:

Since the tragic accident on the Transcocean Deepwater Horizon rig first occurred, we have been committed to doing everything possible to stop the flow of oil at the seabed, collect the oil on the surface and keep it away from the shore.

BP has taken full responsibility for dealing with the spill. We are determined to do everything we can to minimize any impact. We will honor all legitimate claims.

BP’s ads come as a new poll finds that 76 percent of the American public disapproves of how the company is handling the spill. And BP is not taking “full responsibility” for the spill. In fact, officials have repeatedly tried to downplay the disaster and argued that attempts to accurately measure the rate of flow at the seabed are impossible and unnecessary:

– Tony Haywood, BP CEO: “I think the environmental impact of this disaster is likely to be very, very modest. It is impossible to say and we will mount, as part of the aftermath, a very detailed environmental assessment as we go forward.” [5/18/10]

– Haywood: “The Gulf of Mexico is a very big ocean. The amount of volume of oil and dispersant we are putting into it is tiny in relation to the total water volume.” [5/14/10]

– Lamar McKay, President of BP America: “The volume estimates are based effectively on surface expression, because you can’t measure what’s coming out at the seabed.” [Senate testimony, 5/12/10]

– Tom Mueller, BP: “We’re not going to take any extra efforts now to calculate flow there at this point. It’s not relevant to the response effort, and it might even detract from the response effort.” [5/14/10]

– Doug Suttles, BP COO, Global Exploration: “Since the beginning, we’ve said it’s almost impossible to get a precise number. But ourselves and people from NOAA and others believe that something around 5,000 — it’s actually barrels a day — is the best estimate.” [ABC News, 5/14/10]

In Boston Globe op-ed today, columnist Derrick Z. Jackson hits BP for its ads:

It is difficult to conceive of a more resounding insult to our intelligence than BP’s full-page advertisements in the New York Times and USA Today about its response to the massive oil spill in the Gulf of Mexico.

The most intriguing paragraph of the BP ad was, “This is an enormous team effort. More than 2,500 of our operational and technical personnel from around the world are working tirelessly in coordination with the U.S. Coast Guard, and federal, state and local government agencies.’’

But until Deepwater Horizon exploded, BP’s idea of working tirelessly with government agencies was lobbying them to bypass environmental-impact reviews for well permits. Yesterday, the Times had yet another story on how drilling projects have proceeded with environmental waivers, despite President Obama’s so-called moratorium on permits. Deepwater Horizon received an environmental waiver last year and received another one just before the April explosion.

While BP will likely survive this tragedy because of its massive profits, these attempts to shirk responsibility are already beginning to drag the company down in the public’s eyes.

This week, the House of Representatives is trying to pull together a package extending several popular tax breaks as well as important social safety net provisions like unemployment benefits and health insurance subsidies for laid-off workers. The bill costs about $200 billion, but is partially offset by a few tax changes, including the closing of a loophole that allow corporations to claim U.S. tax credits on profits earned overseas.

These unjustified tax breaks have been on the radar of Congress’ tax writers for the last few years, but so far they’ve remained in the tax code due to the pressure of big corporations, which obviously want to preserve their ability to exploit the tax code’s quirks. This time, even though the bill before Congress extends some of their favored tax provisions, like the Research and Development tax credit, the Big Business lobby is at it again, fighting to preserve its ability to use tax loopholes, at the expense of its own tax credits and the extension of unemployment benefits:

International Business Machines Corp. and trade groups for major U.S. companies are pressing Congress to defeat a jobs bill containing billions of dollars in taxes on their global operations…In a letter to lawmakers yesterday, Armonk, New York-based IBM, the world’s biggest computer-services provider, told lawmakers it “strongly opposes” the legislation and would rather do without the research credit than face new taxes on overseas profits.

The Chamber of Commerce has, of course, weighed in on behalf of big business, claiming that the legislation is a “job killer.” Closing the loophole in question would raise about $14.5 billion over ten years, or about $1.5 billion per year from the entire multinational corporation community.

The choice here for Congress is pretty stark. On one side, there’s the need to extend unemployment insurance for workers at a time when long-term unemployment is at record highs and the labor market is still incredibly weak, while at the same time extending tax breaks that help companies innovate and create jobs. On the other side, there’s the ability for multinational corporations to claim U.S. credits on profits that they don’t earn here or pay domestic taxes on.

According to the National Employment Law Project, 1.2 million Americans who are currently eligible for extended benefits will have the rug pulled out from under them in June if Congress doesn’t act. Of course, for months now there has been serious hostility to extending jobless benefits (which does not create a new tier of benefits, so workers who have run the full gamut of the extended program will still see their benefits disappear). Earlier this year, Republicans repeatedly mounted filibusters of extensions, and just yesterday Sen. Judd Gregg (R-NH) said that we should stop extending benefits “right now.”

Last week, the Senate passed Sen. Chris Dodd’s (D-CT) financial regulatory reform bill, which means that it now needs to be merged with the bill that the House of Representatives passed last year. A conference committee — which will be chaired by House Financial Services Committee Chairman Barney Frank (D-MA) — will iron out the differences between the bills and send one piece of legislation back to each chamber for a final vote, before the bill goes to the President.

Before all that, however, the Senate has one last piece of business with which to dispense. This evening, it will vote on two “motions to instruct” the conferees, which aren’t binding, but send a message as to what the majority of the body would like the conferees to fight for. And fighting for either of the motions would be problematic.

The first is comes from Sen. Sam Brownback (R-KS) and would push the conferees to exempt auto dealers from oversight by the proposed Bureau of Consumer Financial Protection. And as Tim Fernholz pointed out, the second, sponsored by Sen. Kay Bauley Hutchison (R-TX), would “weaken language that bars banks from speculating with their own capital — basically, an attack on the Volcker rule.”

Already, the ban on proprietary trading in Dodd’s bill is weak tea, giving regulators vast discretion over whether its implemented (after a study is conducted) and what activities are exempted. Hutchison’s motion (based on an amendment that she proposed) would restrict which activities could be regulated even more, by exempting many (vaguely defined) kinds of activities and an entire industry. Here’s what the amendment said:

(B) subject to such restrictions as the Federal banking agencies may determine, does not include purchasing or selling, or otherwise acquiring or disposing of, stocks, bonds, options, commodities, derivatives, or other financial instruments on behalf of a customer, as part of market making activities, or otherwise in connection with or in facilitation of customer relationships, including risk-mitigating hedging activities related to such a purchase, sale, acquisition, or disposal; and

(C) does not include the investments of a regulated insurance company, or a regulated insurance affiliate or regulated insurance subsidiary thereof

So, if the conferees actually take Hutchison’s language to heart, any activity “in facilitation of customer relationships” would be exempted. I imagine a Wall Steet firm could justify almost any activity as facilitating a customer relationship.

The C section, meanwhile, would exempt insurance companies like AIG from the rule. Considering that AIG ran a hedge fund on the side that blew up in spectacular fashion, necessitating repeated federal bailouts, this strikes me as a mistake. As Treasury Secretary Tim Geithner said, “AIG is a huge complex global insurance company attached to a very complicated investment bank hedge fund that was allowed to build up without any adult supervision.” While we should be preemptively preventing insurance companies from threatening the financial system, there’s no reason to give them a blanket exemption from the Volcker rule, discounting the possibility that one could amass systemic risk and engage in risky trading again.

Stronger Volcker rule language, proposed by Sens. Jeff Merkley (D-OR) and Carl Levin (D-MI) never came up for a vote on the floor, making it unlikely that stronger language will make its way into the final product. And Hutchison’s language would only make the watery language in the Senate bill even worse.

With the financial regulatory reform legislation headed to a conference committee, both the Senate and the House of Representatives will be turning their attention to a variety of bills, including one that extends several tax breaks and social safety net provisions. However, members of both parties are already approaching the bill with consternation, as they are wary of anything that seems remotely associated with government spending.

Among its important provisions, the bill would extend the enhanced unemployment insurance system that passed as part of last year’s economic recovery act. It provides up to 53 weeks of benefits, with an additional 13 to 20 weeks in states hardest hit by the Great Recession. However, Sen. Judd Gregg (R-NH), appeared on CNBC this morning to say that Congress should stop extending benefits “right now” because “at some point you’ve got to acknowledge that we’re not Europe”:

Q: Senator Gregg, is there a point, you think, when the government has to sort of end these ever-continuing claims?

Gregg: Yeah, right now. This week, however, we’re going to extend it again. And this has become counterproductive. We’re basically undermining the cyclical event. Because you’re out of the recession, you’re starting to see growth and you’re clearly going to dampen the capacity of that growth if you basically keep an economy that encourages people to, rather than go out and look for work, to stay on unemployment. Yes, it’s important to do that up to a certain level, but at some point you’ve got to acknowledge that we’re not Europe.

Watch it:

For one thing, Gregg really has no idea what the package does (which doesn’t stop him from going on cable news to complain about it). It doesn’t extend benefits for anyone past 99 weeks (for which some people in the hardest hit states are eligible). No one is proposing 150 or 120 weeks, as Gregg implied.

What the bill does do is ensure that people who are currently unemployed and would be eligible for extended benefits don’t suddenly have those benefits pulled out from under them. It will also ensure that people who recently lost their jobs or who lose their jobs in the coming months can qualify for the full extent of the unemployment insurance program.

Mark Zandi, chief economist of Moody’s Economy.com, was fortunately on with Gregg, and rebuked the senator. “The senator is right except that, in this environment, the job market is so bad, I think it’s still premature to give up on those emergency benefits,” Zandi said. “I mean, just a statistic, for every one job opening there’s five people that are looking for work. That is incredibly unusual, so therefore its premature to give up on those emergency benefits.”

Not only that, but in March 2010, 6.5 million people had been looking for a job . According to the Center for American Progress’ Christian Weller, “The average length of unemployment that month was 31.2 weeks, and 44.1 percent of the unemployed were out of a job for 27 weeks or more. This is a new record for long-term unemployment.” But Gregg — like so many Republicans in recent months — is willing to kneecap them just as the labor market is starting to turn the corner.

(HT: Mike O’Brien)

The oil spill that resulted from a British Petroleum rig exploding in the Gulf of Mexico is still continuing unabated, and many scientists are now saying that BP and the Obama administration are downplaying the amount of oil that is gushing into the water. The joint BP-federal command has been relying on an estimate from NOAA scientists that the oil rate was increasing by 210,000 gallons (5000 barrels) a day, but independent scientists estimate that the flow rate is at least 850,000 gallons a day.

This week, a flurry of environmental organizations, members of Congress, and local officials in the states affected by the spill called for the federal government to take over the response effort from BP. “This is an all-hands-on-deck crisis, and we need to use every asset the U.S. has, including the Defense Department and all of its most sophisticated technology,” said Rep. Ed Markey (D-MA).

Today, on CBS’ Face the Nation, Sen. Lamar Alexander (R-TN) — who spends a lot of his time fearmongering about various government takeovers — seemed to advocate that the government simply let BP off the hook and take over the clean-up effort:

Alexander: There’s one thing [the administration] could do. Under the law, they could fire BP and take it over. But the truth is the federal government probably doesn’t have the capacity to do that. [...]

Q: But would you favor taking over BP if that became necessary?

Alexander: Sure, that’s up to the President to decide. … Under the law the federal government can take it over if they choose. And I understand why they might not choose, but that option exists.

Watch it:

Last week, BP CEO Tony Hayward said that he expects the environmental impact of the disaster will be “very, very modest.” But as The Wonk Room’s Brad Johnson pointed out, “already, toxic sludge has started to ooze onto Louisiana’s fragile wetlands, and oil globs and tar balls have been found on barrier islands and beaches along the northeastern Gulf Coast. The federal government closed 19 percent of the Gulf to fishing on Monday when the slick doubled in size, caught by the Loop Current that is now dragging oil to the Florida Keys.”