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Bachmann Defends Using Federal Loans She Denounced: ‘It’s Almost Impossible To Buy A Home’ Without Them

GOP presidential contender Michele Bachmann (R) has been in hot water in recent weeks for personally taking advantage of hundreds of thousands of dollars in government aid while denouncing the very programs she benefited from. Most recently, the Washington Post discovered that Bachmann and her husband signed for a $417,000 home loan backed by Fannie Mae or Freddie Mac just weeks before she called for the two mortgage giants to be entirely dismantled.

Bachmann has been a consistently fierce critic of mortgage lending programs and has advocated abolishing the government sponsored mortgage enterprises (GSEs) Fannie Mae and Freddie Mac. Yet she took out the maximum possible loan from those programs to finance her family’s move to a lavish 5,200-square-foot home on a golf course.

During an appearance this afternoon at the National Press Club, Bachmann gave a highly ironic defense of her use of federal home loans:

MODERATOR: I got a lot of questions from people asking is it fair for you to call for dismantling federal programs you ultimately have been a beneficiary of? So in terms of guaranteeing home mortgages, do you think the federal government has a role in that…?

BACHMANN: Now unlike all of you, who I’m sure pay cash for your homes, there are people out there like myself who actually have to go to a bank and get a mortgage. And this is the problem. It’s almost impossible to buy a home in this country today without the federal government being involved. Whether it is with the FHA, whether it’s with Fannie, whether it’s with Freddie, it’s almost impossible to buy a home…What’s important is that we do dismantle a number of these federal programs that everyone agrees are clearly out of control.

Watch it:

Bachmann’s disapproval of federal home loan programs obviously didn’t stop her from using them to buy an enormous house for herself. During recent campaign stops, Bachmann has bragged that her family simply “did without” government aid when times were tough, but apparently this time they couldn’t help themselves.

Bachmann said she wants the federal government to get out of the business of guaranteeing mortgages and leave it to the private sector. But Fannie Mae and Freddie Mac currently insure around 90 percent of home loans, and it’s unlikely that homeownership would be as widely accessible without some sort of government backing for home loans. If Bachmann had her way, the U.S. would go back to an era where only the very rich could get mortgages.

At the event, Bachmann also largely dodged questions about her personal finances and her husband’s use of Medicaid funds for his clinic which uses a discredited form of “ex-gay” therapy.

NEWS FLASH

Pelosi supports clean vote on debt ceiling increase | During a question-and-answer session yesterday, House Minority Leader Nancy Pelosi (D-CA) said, “If we don’t come to a conclusion soon, Democrats in the House are saying, we must pass a clean debt ceiling bill while continuing our discussions, as we know we must to reduce the deficit.” The Congressional Black Caucus has also said that a clean vote is the path out of the current stalemate. Today, the Congressional Progressive Caucus announced its support of Rep. Peter Welch’s (D-VT) clean vote proposal to get out of the current crisis. Read our view on the need for a clean vote here.

GOP Shuts Down FAA To Aid Delta’s Anti-Union Efforts, Delta Collects Millions In Extra Profits

As the debt ceiling showdown continues to suck all of the oxygen out of Washington, the fact remains that the Federal Aviation Administration is shutdown due to a lack of funding, and House Transportation Committee Chairman John Mica (R-FL) says he has “no idea” when the FAA might be reauthorized. Due to the shutdown, 4,000 federal employees have been furloughed, the more than 150,000 airport construction projects have been halted (idling 70,000 workers) and the government is unable to collect more than $200 million per week in airline taxes.

House Republicans shut down the FAA over their insistence that any bill to reauthorize the agency also include an anti-union provision that would make it harder for employees at airlines and railroads to organize. One of the biggest corporate proponents of this anti-union provision is Delta Airlines, which has been fighting for years to stave off unionization (and is currently under investigation for tampering with union elections). Ironically, the GOP shut down the FAA due to Delta’s anti-union demands, and Delta is now profiting off of the FAA shutdown:

Delta Air Lines Inc. said on Wednesday it will keep pocketing millions in additional daily revenue from federal taxes that disappeared last week because of the Federal Aviation Administration’s shutdown…The FAA’s inability to collect a variety of levies including domestic ticket sales taxes and segment fees is allowing Delta to reap between $4 million and $5 million in additional daily revenue. The taxes had added 10% or more to an airline ticket’s price. Most—but not all—airlines have raised ticket fares by a similar amount.

Several airlines, Delta included, have increased their ticket prices following the suspension of federal airline taxes, and are simply pocketing the difference, rather than passing the savings on to customers. Yesterday, Sen. Jay Rockefeller (D-WV) took to the senate floor to excoriate the GOP for letting Delta dictate policy:

I wish I understood why the policy objections of one company — Delta Air Lines — mattered more than the livelihoods of thousands of people. Last year, the CEO of Delta made $9 million. Delta paid its top executives almost $20 million. Yet, it is fighting to make sure its employees cannot organize for fear that they may secure a few extra dollars in their paychecks. At the same time it is pushing for special interest provisions in the FAA bill, Delta announced it was abandoning air service to 26 small rural communities—leaving many of them without air service.

Adding one last bit of insult to injury, Delta announced yesterday that it will be cutting 2,000 jobs, while increasing fares and cutting back on services. Last month, Delta found itself in hot water for charging troops who were returning from Afghanistan $2,800 in baggage fees.

NEWS FLASH

BREAKING: Boehner postpones vote | Official word sent to House members:

**Members are advised that the House GOP Leadership has postponed the votes on the motion to recommit and final passage of S. 627 – Speaker Boehner’s Short Term Default Act (amending the Faster FOIA Act of 2011). Following general debate on S. 627, the House will consider the eight bills listed for consideration under suspension of the Rules.

After Slamming Obama For Being ‘Anti-Manufacturing,’ Gingrich Campaign Caught Selling T-Shirts Made In El Salvador

In the latest embarrassment for Newt Gingrich’s floundering presidential campaign, an ABC producer discovered that Gingrich’s campaign T-shirts are not being made in America, but in El Salvador, even as Gingrich spends his time on the campaign trail calling American manufacturing “crucial” to the economy’s future. Gingich has also slammed the Obama administration for being “anti-manufacturing.”

According to the producer, Gingrich had originally said he would make sure his campaign gear was manufactured in America. Gingrich was confronted about the gear on the campaign trail as he awkwardly held up one of the shirts in question:

ABC: I just picked up that one and it was made in El Salvador…It was a big thing when we talked to your campaign people about how you wanted things to be made in America, do you have plans to change things?

GINGRICH: I have no — I’ll have to ask the folks who ordered this. I don’t order it and I don’t do it.

CAMPAIGN SPOKESPERSON: That was a rush order made by some of the volunteers.

GINGRICH: One of the challenges with a volunteer campaign is lots of volunteers do lots of different things.

Watch it:

Gingrich spokesperson Michelle Selesky tried to intervene by throwing the blame on campaign volunteers. Gingrich quickly took the cue and echoed her excuse.

On the campaign trail, Gingrich has repeatedly called for a resurgence in American manufacturing. He has denounced the EPA, the National Labor Relations Board and other agencies and regulations for “killing manufacturing jobs.” However, in March, Gingrich also made a misstep when he said that the North American Free Trade Agreement (NAFTA) worked because it created jobs — in Mexico and Canada.

Paul Ryan: I ‘Never Thought’ It Was ‘Realistic’ To Pass A Balanced Budget Amendment

House Budget Committee Chairman Paul Ryan (R-WI) said last night that he “never” expected a Balanced Budget Amendment to pass, even as a large minority of House Republicans are threatening to reject any debt ceiling increase unless the Constitution is rewritten to include one. Speaking with Fox News host Greta Van Susteren, Ryan said it’s not “realistic” to expect that Democratic House Leader Nancy Pelosi (D-CA) and Senate Leader Harry Reid (D-NV) would force the large number of members needed to change the Constitution to “vote against their conscious”:

RYAN: What I never really agreed with is the idea that we would expect Harry Reid and Nancy Pelosi to deliver 40 [and] 15 votes from Democrats for our version of the Balanced Budget Amendment. You know, I just never thought that was realistic, to demand Democrats vote against their conscious for our version of the Balanced Budget Amendment. So I just never thought that would work.

Watch it:

Ryan’s political calculus is of course accurate, but it’s noteworthy coming from the GOP’s chief number cruncher and the staunchly conservative author of the Medicare-ending Republican budget. The current GOP version of the BBA is a disastrous idea that even leading conservatives have rejected. There’s no way it could achieve the two-thirds majority needed in both houses of Congress to pass, let alone before the Aug. 2 deadline to raise the debt limit. But as House Speaker John Boehner (R-OH) said yesterday, many members of own caucus are willing to let the deadline pass in the hope that the ensuing economic “chaos” would force Democrats to switch their votes.

The amendment is an integral part of the GOP’s “Cut, Cap, and Balance” plan. This was the only GOP debt ceiling solution until it was rejected by the Senate, forcing Boehner to roll out his own framework Monday that has divided the GOP. Recognizing the reality of the situation, Sen. John McCain (R-AZ) took to the senate floor yesterday to excoriate his colleagues‘ intransigence for demanding nothing short of an Constitutional amendment.

NEWS FLASH

Report: Stocks Will Fall 30 Percent If Government Defaults | Stocks could fall as much as 30 percent and the economy could contract as much as 5 percent over the next six to 12 months if the government defaults, according to a report from Credit Suisse. Like much of Wall Street, the bank remains confident that the government will avert that problem, setting the chances of default at less than 1 percent. But even if it avoids default without reaching a debt deal, markets could slide as much as 15 percent. If Congress doesn’t reach a deal within the next three to six months, the risk of another recession is “very significant,” the report says.

Boehner Debt Ceiling Plan Drops A 26-Year-Old Exemption That Protects The Poor From Budget Cuts

As the Republicans haggle over whether to support their own plan for raising the nation’s debt ceiling, an “unprecedented” coalition of religious leaders are urging President Obama and Congress not to sacrifice the needs of the poor in the name of debt reduction. Even the conservative U.S. Conference of Catholic Bishops joined the effort, singling out House Speaker John Boehner’s (R-OH) plan for its “disproportionate cuts in essential services to poor persons.”

In scrutinizing the debt deals, some religious leaders praised the plans for at least exempting low-income “means-tested” programs from across-the-board cuts. The Center for Budget and Policy Priorities notes today, however, that Boehner’s plan does not actually exempt programs like Medicaid and food stamps from such cuts. Instead, it does the opposite.

Breaking a 26-year policy of exempting basic low-income entitlement programs from across-the-board cuts, both of the House Republican plans — “Cut, Cap, and Balance” Act and Boehner’s debt-ceiling proposal — “drop all of the low-income exemptions that have been part of every previous across-the-board cut mechanism since 1985″:

For 26 years, all budget legislation that would trigger across-the-board cuts if Congress fails to meet a fiscal target has exempted the basic low-income (or “means-tested”) entitlement programs from those cuts. The Gramm-Rudman-Hollings laws of 1985 and 1990, the deficit reduction agreement of 1990, and the Balanced Budget Act of 1997 — all bipartisan pieces of legislation — included that exemption. So did last year’s “pay-as-you-go” law, which requires Congress to offset the cost of new tax cuts or increases in entitlement programs so they don’t increase the deficit. Congress has never enacted a law with an across-the-board cut mechanism that subjects core assistance for the poor to these cuts.

But in the last few weeks, House Republicans have advanced two major pieces of legislation that would do just that. Both the “Cut, Cap, and Balance Act,” which the House passed last week, and the new Boehner debt-ceiling proposal drop all of the low-income exemptions that have been part of every previous across-the-board cut mechanism since 1985.

“In an exercise in political cynicism,” CBPP notes that both bills include an exemption for payments to Medicare providers that was not part of previous laws. This allows Republicans to avoid another hit from the senior community “even as they subject those living below the poverty line to the risk of automatic cuts that would push them even deeper into poverty.” Earlier this week, CBPP put out an analysis showing that Boehner’s debt ceiling plan “could well produce the greatest increase in poverty and hardship produced by any law in modern U.S. history.”

The Republican move to cut a long-standing bipartisan protection for the poor really brings into question exactly which Americans Republicans say they’re fighting for. Religious leaders should take note. If asked “What Would Jesus Cut,” it seems Republicans are determined to provide the wrong answer.

Yglesias

Education Department Preparing To Reform Without Legislation

I went this morning for an off-the-record chat with Education Secretary Arne Duncan and some of the other key staffers at the Department of Education. They were mostly talking education policy (naturally) but what they were talking about shed an interesting window on the larger political dysfunction of the United States. Basically when the so-called “No Child Left Behind” version of the Elementary and Secondary Education Act was signed into law in early 2002, the expectation was that it would last for five years or so and be due for reauthorization and re-writing in 2007. It didn’t happen. And it didn’t happen in 2008 either. No biggie. Reauthorizations often don’t happen on schedule. Then when President Obama took office in 2009, he had large Democratic majorities in congress and a huge recession to deal with. So in addition to recovery measures, he emphasized an agenda that tended to unite his caucus and put ESEA reauthorization on the back-burner as something he was more likely to be able to get bipartisan support for.

So here we are in 2011, the year that was supposed to be the reauthorization year. Except it’s the end of July and we’re having a doomsday standoff over the debt ceiling. Then in September appropriations expire. Then next thing you know it’s the holidays and it’s re-election season. So while the administration still wants a proper re-write and re-authorization, nobody’s counting on it happening. Instead, the plan is to drive policy change by issuing “waivers.” Basically, the Secretary has the ability to grant conditional relief from the law’s requirements. And since the proficiency standards for Adequate Yearly Progress were set very (i.e., unrealistically) high, the waivers will be much in need. So the thinking is that rather than formally re-write the law, the administration will be able to say “well you get a waiver from this and that if you do this and that” and thus, in practice, federal education policy can change fairly dramatically without congress doing anything.

It’s clever, and since it’s probably not the kind of issue around which congress will organize a massive backlash (compare to, say, the EPA) it just might work. But it should also be taken as another sign of the increasing breakdown of our machinery of government.

Rep. Cummings: Obama Should Ask For A Clean Bill To Raise The Debt Ceiling

As House Speaker John Boehner (R-OH) struggles to get his caucus’ collective “ass in line” for today’s vote on his re-worked debt ceiling plan, a growing number of House Democrats are pushing for a vote on a clean debt ceiling increase. Rep. Peter Welch (D-VT) and the Congressional Black Caucus — save Rep. Allen West (R-FL) — were rounding up support for a plan that, absent a debt deal that can pass in both chambers, will just raise the debt ceiling to prevent default this coming Tuesday.

On MSNBC’s Morning Joe today, Rep. Elijah Cummings (D-MD) predicted that this is the exact scenario Congress will face. “I think we’re going to end up in a stalemate,” said Cummings:

CUMMINGS: I think we’re at a point where the Republicans have pushed and pushed, haven’t given much at all, and now I think we’re going to end up in a stalemate. I anticipate that the Boehner bill will get through the House today after he’s pushed his folks kind of hard and then it’ll be dead on arrival once it get’s to the Senate, then the Senate will send something over.

And then I think the president is going to have to step in. Then he’s going to have to say ‘Look guys, there doesn’t seem to be an agreement here. And so basically let’s send this clean extension.’ By the way, which is what just about every member of the Democrats on the House side are petitioning for. And I think we’ll resolve this matter. And that’s the way it should’ve been. I still think this whole thing has been manufactured.

Watch it:

Some Democrats are even calling for Obama to use the untested legal option, via the 14th Amendment, to unilaterally raise the debt ceiling without congressional consent. “We’re getting down to decision time,” said Rep. John Larson (D-CT). “We have to have a fail-safe mechanism. We believe that fail-safe mechanism is the 14th Amendment and the president of the United States.”

Huge Labor Victory: After IKEA Outsourced Swedish Jobs To Virginia To Thwart Unions, Virginia Workers Vote To Unionize

As ThinkProgress reported last April, home furniture giant IKEA has set up shop at a manufacturing plant in Danville, Virginia for the past three years in order to gain access to a non-unionized pool of labor and avoid Swedish unions. Workers at the Danville plant allegedly faced mandatory overtime, frantic hours, and even racial discrimination.

Yesterday, following an intense union organizing drive by the International Association of Machinists and Aerospace Workers, the employees at this Virginia plant voted overwhelmingly to unionize:

Workers at Ikea’s U.S. furniture factory voted to form a union, a victory for the labor movement seeking to rebound from record-low membership at private companies. Employees at the plant in Danville, Virginia, voted 221-69 today to join the International Association of Machinists and Aerospace Workers, the National Labor Relations Board said. The factory, operated by a subsidiary called Swedwood, makes low- cost bookcases and coffee tables for sale in Ikea’s 37 blue and yellow U.S. big-box stores.

Local news station WDBJ7 covered the workers’ victory. Watch it:

“We fully support the right of our co-workers to make this decision,” said a spokeswoman for the IKEA subsidiary that operates the plant. “We accept their decision and will work with their union in a mutually cooperative and respectful manner.”

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In Video And Campaign Speech, Romney Touts Manufacturing Plant That Received More Than $200,000 In Stimulus Funds

GOP 2012 presidential hopeful Mitt Romney has been basing his campaign on his supposed economic bona fides, falsely stating that the Obama administration has made the economy “worse.” Romney particularly highlights his supposed history as a job creator. “I know what it takes to create jobs,” he says. “I’ll do everything in my power to create more jobs for Americans.”

Romney took his roadshow to Ohio yesterday. He spoke a manufacturing plant run by Screen Machine Industries Inc., where he , according to the Columbus Dispatch, “focused his remarks on jobs and the economy.” Bernard Cohen, the owner of Screen Machine Industries, joined the pile-on against President Obama, saying, “I think Obama doesn’t understand business and he’s hurting us.” Romney also featured Screen Machine Industries prominently in a web video that he released yesterday:

However, neither Romney nor Cohen ever pointed out that Screen Machine Industries has received substantial support from the 2009 Recovery Act (i.e. the stimulus). In fact, the company received four different stimulus contracts from the Department of Veterans Affairs, totaling more than $218,000:

Romney, of course, has slammed the “failed stimulus package,” saying it was akin to “putting a cup of gasoline on a fire.” Cohen said that he doesn’t recall receiving stimulus money.

This isn’t the first time Romney has chosen his venue for a campaign speech poorly. Back in June, he gave a speech at a bank that had received TARP funds, despite deriding TARP as a “slush fund.”

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NEWS FLASH

Americans For Tax Reform President Grover Norquist: It’s ‘Possible’ Default Would Be ‘Okay’ To Resist Raising Taxes | While appearing on MSNBC’s Morning Joe this morning, Americans for Tax Reform (ATR) president Grover Norquist got in a spat with Lawrence O’Donnell over whether the ATR chief would ever advocate voting against raising the debt ceiling. “You’re saying there are situations where you do think default would be okay?” O’Donnell asked. “It’s possible,” replied Norquist, who went on to reiterate that his organization is against raising taxes. Watch it:

Speaker of the House John Boehner (R-OH) admitted yesterday that “a lot” of House Republicans want to push the country into default in order to create “chaos” and push through conservative priorities.

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Econ 101: July 28, 2011

Welcome to ThinkProgress Economy’s morning link roundup. This is what we’re reading. Have you seen any interesting news? Let us know in the comments section. You can also follow ThinkProgress Economy on Twitter.

  • House Republicans are moving ahead with a vote on Speaker John Boehner’s (R-OH) debt ceiling plan today “even though the legislation faces a White House veto threat and unanimous opposition among Senate Democrats.” [Associated Press]
  • In the next few days, the Treasury Department may release details of “who would get paid and how much in the event Congress does not approve any new borrowing authority by Aug 2nd.” [Politico]
  • Senior Democrats yesterday said that “the Aug. 2 deadline for raising the nation’s debt ceiling might not be as rigid a cutoff date as the administration has been saying.” [The Hill]
  • Wall Street bankers and executives “are complaining that the Federal Reserve is refusing to engage in scenario planning for a US downgrade or default.” [Financial Times]
  • Sixty-seven percent of those questioned in a new poll said “they would prefer that politicians focus on employment” instead of the deficit. [Bloomberg]
  • Education Secretary Arne Duncan yesterday “reiterated the Obama administration’s commitment to keeping the maximum Pell Grant at $5,550 in fiscal year 2012, although the grants are the main reason the Education Department’s requested budget has increased 20 percent since 2010.” [Inside Higher Ed]
  • Wall Street is upset that the Labor Department is moving ahead with rules that would require brokers who run retirement funds to only look out for the best interest of their clients. [Wall Street Journal]
  • “Foreclosures declined in more than 84% of U.S. metro areas during the first half of the year,” according to the latest data from RealtyTrac, “but that doesn’t mean these markets are staging a turnaround.” [CNN Money]
  • Mega-bank Goldman Sachs is hoarding aluminum in warehouses in Detroit, “creating a supply pinch for manufacturers of everything from soft drink cans to aircraft.” [Associated Press]
  • House Ways and Means Chairman Dave Camp (R-MI) said yesterday that a deal had been forged to move ahead on three pending free trade pacts, but “a Senate Democratic aide and the White House countered the statement, saying no deal has been crafted.” [The Hill]
  • Of the 12 Federal Reserve Districts surveyed by the central bank for its latest economic report, “just one reported an uptick in growth.” [The Hill]
  • Kentucky Attorney General Jack Conway (D) yesterday filed suit against the for-profit college chain Daymar Colleges, claiming that administrators “have consistently deceived students by making false promises about the ability to transfer course credits and have forced them to purchase textbooks and supplies at substantially marked-up rates.” [Huffington Post]
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