The U.S. Chamber of Commerce, which purports to be “the voice of business,” is run by a Republican money machine. As the nation’s largest lobbying shop, the Chamber is spending millions of dollars from its corporate members against President Obama’s progressive agenda of health care, energy, and financial reform. The Chamber claims that the “board’s membership is as diverse as the nation’s business community itself,” but this is false. A Wonk Room analysis of federal election contribution data compiled by the LittleSis project has found that the Chamber’s 116-member board of directors has given more than six times as much money to Republican candidates and committees ($4,741,747) as it has to Democrats ($778,282), with $1,074,697 flowing to corporate political action committees:

Source: Center for American Progress Action Fund, from Federal Election Commission data compiled by the LittleSis project of the Public Accountability Initiative.

The top beneficiary of this outpouring of conservative cash is the Republican National Committee, which has received over ten times as much money from the Chamber’s board as the Democratic National Committee — $1,257,201 versus $102,950. Contributions went 4.5 to 1 for John McCain ($373,150) versus Barack Obama ($82,150).

Source: Center for American Progress Action Fund, from Federal Election Commission data compiled by the LittleSis project of the Public Accountability Initiative.

Of the board’s 116 members, 96 have made major political contributions. Sixty-eight directly contributed to the campaigns of George W. Bush or John McCain. In contrast, only 27 gave to the campaigns of Al Gore, John Kerry, or Barack Obama. Forty-seven board members, including Chamber of Commerce president Tom Donohue, have contributed more than 90 percent to Republicans, averaging $74,634 in GOP contributions. Only seven members have contributed more than 90 percent to Democrats, averaging $3,529 to Democrats.

The political giving is dominated by leading Republican billionaire George Argyros, the Bush pioneer who served a disastrous term as the U.S. ambassador to Spain. Argyros is also one of the top backers of Newt Gingrich’s right-wing American Solutions for Winning the Future. The following visualization of Chamber of Commerce board member contributions is a sea of red surrounding a few small islands of blue. The size of each box is proportional to amount of total contributions per person, with the shading indicating percentage of Republican versus Democratic contributions:

The Chamber’s Board: A Right-Wing Money Machine

Source: Center for American Progress Action Fund, from Federal Election Commission data compiled by the LittleSis project of the Public Accountability Initiative.

Cross-posted at ThinkProgress.

Yesterday, Bloomberg News reported that seven Wall Street lobbyists “trooped to Capitol Hill,” in an attempt to talk Rep. Paul Kanjorski (D-PA) out of proposing legislation that would allow the government to break up any financial firm deemed systemically risky. According to Bloomberg, the lobbyists left with the “sobering conclusion” that Kanjorski isn’t backing down.

Of course, that setback won’t end the banks’ effort to stop such legislation from going forward. In fact, next week they will be calling on some of their friends from around the business world to try to convince New York’s congressional delegation that such legislation “would undermine the Big Apple’s economy and its reputation as a world financial hub”:

Among roughly 20 business leaders slated to come to a meeting called by Rep. Charles Rangel (D-N.Y.) are: Rupert Murdoch, CEO of News Corp.; Lloyd Blankfein, CEO of Goldman Sachs; Larry Fink, CEO of BlackRock; and William Lauder, CEO of The Estee Lauder Companies Inc.…“If the U.S. dismantles our leading institutions, then it will destroy the American financial center, which is largely anchored in New York,” said Kathryn Wylde, president and CEO of the [Partnership for New York City]. “It’s just frightening.”

Of course, the UK has already begun breaking up firms that were deemed “too big to fail,” and the financial sector is arguably more important to London than it is to New York.

This isn’t the first time that large corporations have gone to bat for the banks when it comes to regulatory reform. When the House Financial Services Committee was working on a bill reforming the derivatives market, a coalition of business groups came in to pressure lawmakers, despite the fact that 97 percent of derivatives are held by just five large financial firms.

The details of these provisions — particularly what constitutes an undue amount of risk and who gets to ultimately pull the trigger to break up a firm — have yet to be ironed out, and I would hope that Rupert Murdoch and William Lauder don’t have enough sway over regulatory policy to make much of a difference. (Since they’re joining with Goldman Sachs CEO Lloyd Blankfein, are they also doing “god’s work”?)

As Kanjorski said, this could be “one of our potentially last chances to get control, particularly of financial institutions in their mega-forms, before they take over the world.” It’d be a shame if News Corp. took that chance away.

The Politico reported today that, in his 2010 State of the Union address, President Obama is going to announce a serious focus on deficit reduction:

President Barack Obama plans to announce in next year’s State of the Union address that he wants to focus extensively on cutting the federal deficit in 2010 – and will downplay other new domestic spending beyond jobs programs, according to top aides involved in the planning. The president’s plan, which the officials said was under discussion before this month’s Democratic election setbacks, represents both a practical and a political calculation by this White House.

As Andrew Sullivan wrote, “this classic Politico piece — in as much as it regurgitates almost comically process-oriented Beltway wisdom — fails to mention a few things about Obama’s spending in his first year,” including: the recession, that health care reform is paid for, and that “there’s a big big difference between spending on green and infrastructure investment and slashing taxes or increasing Medicare entitlements.” Chris Hayes added “there’s one big maddening conceptual error at the heart of this piece…which is to confuse relatively substantial pieces of domestic legislation with a spending ‘binge.’”

But if true, what does the administration mean by “focus extensively” on deficits next year? And what will that entail for the domestic agenda? I certainly hope that no one is thinking of making a 1937-style haul back on recovery efforts. Judging by the public statements of Treasury Secretary Tim Geithner and Office of Management and Budget Director Peter Orszag, they aren’t, but if the administration is quaking over the political ramifications of the deficit now, how long until they head in that direction?

This week, we’ve already seen a group of senators threaten to force the U.S. to default on its debt (by refusing to increase the federal debt ceiling), if they don’t get a bi-partisan commission that will be tasked with cutting Social Security and Medicare. This deficit-mania comes despite a stubbornly weak labor market, and at the same time that Congress is insisting that more must be done in terms of job creation.

Of course, there’s nothing wrong with wringing waste from the system, and there are surely some ineffective or duplicative programs in the various federal agencies that can afford to go by the wayside. And if that’s what the administration means, more power to them.

But as Paul Krugman wrote, “conventional wisdom in Washington seems to have congealed around the view that budget deficits preclude any further fiscal stimulus — a view that’s all wrong on the economics, but that doesn’t seem to matter.” It’d be a shame to see the administration turn this particular bit of conventional wisdom into policy that doesn’t provide more support to the job market, and at worst, could choke off economic recovery.

Back during the stimulus debate, one of the items that was pared back in order to get the overall package under an arbitrary $800 billion price tag was fiscal aid to states and local governments. $40 billion that would have gone to help states weather the economic downturn was lopped off of the bill to placate moderate senators.

As it turns out — and as many economists said at the time — this was not a very good idea. A new report from the Pew Center on the States warns of “fiscal peril” in 10 states which, if unaddressed, will hamper the nation’s economic recovery:

These states’ budget troubles can have dramatic consequences for their residents: higher taxes, layoffs or furloughs of state workers, longer waits for public services, more crowded classrooms, higher college tuition and less support for the poor or unemployed. But they also pose challenges for the country as a whole. The 10 states account for more than a third of America’s population and economic output. And actions taken by state governments to balance their budgets — such as tax increases and drastic spending cuts — can slow down the nation’s economic recovery.

“The problems are evident from coast to coast,” said Mark Zandi, chief economist of Moody’s Economy.com. “Without more help to state and local governments, the resulting budget cuts will become a very significant drag on the economy.” The Center on Budget and Policy Priorities estimates that state budget shortfalls could mean that nearly a million jobs to disappear in the next year:

Presuming they will get no more fiscal relief, states will have to take steps to eliminate deficits for state fiscal year 2011 that will likely take nearly a full percentage point off the Gross Domestic Product. That, in turn, could cost the economy 900,000 jobs next year…Deficits for the current state fiscal year, not all of which states have closed, total more than 25 percent of state general fund budgets, making these the largest shortfalls on record.

As Derek Thompson wrote, those protesting more state aid “must recognize what that entails: hundreds of thousands of state employees joining the ranks of unemployment, and unemployment benefits. Q3 was great, but this thing isn’t close to being over.” And these employees are teachers, police officers, and health care workers — not the kind of employees that it’s easy to make do with less of.

The administration announced today that it is planning a “jobs summit” for December, with Obama calling high unemployment one of the administration’s “great challenges.” If the administration is serious about policies aimed at stemming job loss, more aid to states should certainly be on the table.

One of the worst abuses in the international labor markets is the use of child labor. The most recent report on the issue by the International Labor Organization found that as of 2004 more than 218 million children were engaged in illegal work, as defined by international treaties. It’s estimated that 126 million of these children were engaged in hazardous work such as “mining or handling chemicals.”

In order to combat the issue, the Senate Finance Committee has included sections in S.1631, the Customs Facilitation and Trade Enforcement Reauthorization Act of 2009, that would ban the importation of goods made “with convict labor, forced labor, or indentured labor under penal sanctions.” Such a measure by the world’s largest importer would strike a crucial blow against the use of child and slave labor.

Business groups and their lobbyists, however, are not taking kindly to the measures. The D.C.-based business newsletter “Inside U.S. Trade” reports that business groups are “worried” about the effects of such a provision, and they expect to see industry lobbyists and foreign governments profiting from child labor to form an “ad hoc” coalition to oppose it:

Business groups are worried by the potential effects of provisions banning the import of all goods made with convict labor, forced labor, or forced or indentured child labor that were included in a customs bill sponsored by Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Charles Grassley (R-IA)

Business sources say this reporting requirement could cause DHS to more actively seek out imported products made with child labor, forced labor or convict labor. [...]

Sources conceded that this was a sensitive issue because industry groups do not want to be seen as opposing strict measures guarding against human rights abuses. However, one source did expect a push from lobbyists closer to the finance committee mark-up of the bill, and speculated that U.S. industry groups and foreign governments could form ad hoc coalitions to help send a united message.

MSNBC host Rachel Maddow covered the story last night. Addressing the business interests opposing the measure directly, she said, “You think that child labor and slave labor and forced convict labor are cheap and therefore cool with you? Go ahead, make your case. I would love to hear it …. you child labor-endorsing, pro-slavery freaks.” Watch it:

(HT: Openleft)

On April 20th, President Obama nominated Patricia Smith to the post of Department of Labor Solicitor, the number three spot within DoL and the department’s top law enforcement post. But, nearly seven months later, Smith’s nomination still has not come to the Senate floor for a vote, in part because, in early October, Sen. Mike Enzi (R-WY) placed a hold on it.

Already, one of Obama’s DoL nominees, Lorelei Boylan, withdrew her nomination after a lengthy wait for a confirmation vote. But it’s imperative that Smith’s nomination be brought to the floor and that she get confirmed.

As Solicitor, Smith would be responsible for enforcing all of the nation’s workplace laws, and overseeing the office representing the agency in all enforcement actions. And such actions are clearly necessary, as 16 people die at work every day from employer negligence in America, while 68 percent of low-wage workers report that they have been the victim of wage violations. All told, the typical low-wage worker victimized by wage theft sees an overall 15 percent reduction in pay annually.

Under the Bush administration’s corporate-friendly Labor Department, the solicitor’s office sat on its hands and failed to enforce even the most flagrant labor violations. And Enzi seems to be trying to maintain the status quo. As Thomas Frank wrote, Enzi is coming after Smith “because she is an effective and innovative labor bureaucrat.” Is Enzi motivated by “the dread possibility of a Labor Department that works?” Frank asked. AFL-CIO President Richard Trumka agreed, saying that those in Congress who are holding up the nominees are doing so simply “because they don’t want those positions filled.”

The New York Times has called Smith “one of the nation’s foremost labor commissioners because of her vigorous efforts to crack down on minimum wage and overtime violations at businesses including restaurants, supermarkets, car washes and racetracks.” During her time with the New York State Labor Department, where she is labor commissioner, Smith helped win more than $20 million in back pay for thousands of low-wage workers, including a record $2.3 million settlement with the owner of Ollie’s Noodle Shop and Grill chain in Manhattan.

As David Madland and Karla Walter pointed out, “too often penalties [for labor law violations] are easily reduced or levied for low amounts, and the solicitor’s office has minimized civil and criminal liability for the worst violators.” Smith can change that, if only her nomination could come to a vote.

The American Coalition for Clean Coal Electricity (ACCCE) — a front group of big utilities and coal companies — is no stranger to fraud. During the summer’s House debate on cap-and-trade legislation, lobbyists working on behalf of the coal group sent forged letters to members of Congress, and lied under oath about it. Now, ACCCE is trying to exploit Veterans Day by misrepresenting veterans groups in an email to supporters:

With Veterans Day around the corner, we wanted to take a moment to reflect on all the military personnel who are involved in ensuring our country is protected.

Energy security is one issue that has become increasingly important to our veterans. In fact, national veterans groups Votevets and Operation Free are urging the government to become more energy independent and less reliant on foreign oil.

We can do this by using the abundant domestic fuels we already have. With more than 250 billion tons of recoverable coal reserves, the United States has more coal than the Middle East has oil.

The letter implies that VoteVets and Operation Free support ACCCE and its dirty energy agenda, but the the two groups are actually vocal backers of clean energy legislation. VoteVets excoriated ACCCE for citing them in the email, writing that VoteVets “will never advocate the continued use of carbon based fuels” and that ACCCE is trying “to hijack America’s Veterans” in “an act of despicable hubris.”

Operation Free — a veterans group which is dedicated to fighting climate change — was also quick to condemn ACCCE. In a blog post, Operation Free wrote that the email “dishonors Veterans day” and is “insulting to all of the Veterans who are fighting to protect America’s national security by supporting clean, American power.”

Will ACCCE acknowledge their continued misrepresentation and apologize for using Veterans Day as a prop to support an agenda that many veterans oppose?

Today, Senate Banking Committee Chairman Chris Dodd (D-CT) released a discussion draft of his bill overhauling the nation’s financial regulatory framework. At the bill’s formal roll-out, Dodd called it “sweeping, bold, [and] long-overdue.”

With this bill, there are now competing versions of regulatory reform in the Senate and the House, where the effort is being led by Financial Services Committee Chairman Barney Frank (D-MA). Unlike Frank, who chose a piece-meal approach, Dodd is moving his legislation as one large package.

Overall, Dodd’s bill is more ambitious, and would go further in terms of blowing up and replacing the current system (but it also hasn’t been through mark-up, which is where some of the changes in the various pieces of House legislation originated). Below is a comparison of the major provisions in the two versions:

Provision	Senate Bill	House Bills
Consumer Financial Protection Agency (CFPA)	Includes a CFPA with rule-writing authority, with no federal preemption of state law. All financial institutions are subject to examination by the CFPA.	Includes a CFPA with rule-writing authority, and bank regulators can preempt state law on a case-by-case basis. Financial institutions with less than $10 billion in assets are not subject to CFPA examinations.
Consolidated Regulators	Consolidates all existing federal bank regulators into one super-regulator, the Financial Institutions Regulatory Authority (FIRA). Removes bank supervisory powers from the Federal Reserve and the FDIC.	Merges the Office of Thrift Supervision (OTS) and the Office of the Comptroller of the Currency (OCC), leaves other regulators in place.
Resolution Authority	Includes resolution authority, funded by an after-the-fact assessment on institutions with more than $10 billion in assets. Institutions must draw up a “living will,” to be used in the event they must be unwound.	Includes resolution authority, pre-funded by an assessment on institutions with more than $10 billion assets. Institutions must draw up a “living will,” to be used in the event they must be unwound.
Systemic Risk	Creates a new Agency for Financial Stability, composed of the federal bank regulators and two independent councilors appointed by the President. The council will make decisions regarding systemically risky firms.	A systemic risk council, composed of the federal bank regulators, will make decisions, to be carried out by the Federal Reserve. The Fed would be empowered to conduct “on site” examinations of any systemically risky firm.
Breaking up risky firms.	Gives federal regulators the authority to break up systemically risky firms on a case-by-case basis.	Gives federal regulators the authority to break up systemically risky firms on a case-by-case basis.

Both the House and Senate also have provisions aimed at reining in use of over-the-counter derivatives and regulating hedge funds and other non-bank entities. But politically, the two most contentious issues will likely be reconciling Dodd’s complete consolidation of regulators with Frank’s more limited approach, and trying to garner Republican support for the CFPA on the Senate side.

At a meeting of the G-20 over the weekend, British Prime Minister Gordon Brown turned some heads by suggesting that the cost of any future bank failures be funded by assessing a financial transactions tax (FTT) on all trades (assuming that other nations agree to implement such a tax).

While the idea that taxpayers shouldn’t have to foot the bill when a bank fails was widely agreed upon, the FTT proposal ran into a wave of opposition, including from U.S. Treasury Secretary Tim Geithner:

U.S. Treasury Secretary Timothy Geithner on Saturday firmly opposed a proposal by UK Prime Minister Gordon Brown for a global tax on financial transactions. “That’s not something we’re prepared to support,” Geithner said, speaking after meetings of Group of 20 finance ministers and central bank governors in Scotland Saturday. He added that it is an idea that has been around a long time and has received mixed results.

While I don’t think that revenue from an FTT should contribute to the bank failure fund — because that would cause all traders, instead of just systemically-risky banks, to foot the bill — Geithner should be open to looking at an FTT as a general revenue raiser, particularly as Wall Street rebounds to record profits while Main Street stays in the doldrums.

The FTT, in theory, would be a fee of a fraction of a percent imposed on all trades. Regular investors likely wouldn’t notice it at all, but it could raise significant revenue from firms like Goldman Sachs, who are consistently churning paper back and forth.

Consider that, before the economic crash, financial service companies accounted for 41 percent of all domestic corporate profits. And just more than one year after Wall Street’s collapse, they’re back to making 31.5 percent. As Felix Salmon wrote, “financial services companies are meant to be intermediaries, middlemen.” But instead, they’re netting a huge chunk of domestic profit all for themselves, casting serious doubt on whether their activities are actually providing any social benefit.

As Dean Baker, the most outspoken advocate of the FTT, wrote, “if a financial transactions tax reduces the volume of trading, and therefore the resources used by [the financial] sector, without harming the sector’s ability to allocate capital, then it will be making the sector more efficient and freeing up resources for more productive uses”:

This could potentially be a very large benefit from an FTT. If it reduced trading volume by 25 percent (the middle scenario in Pollin et al.), leading to a corresponding reduction in resource use, it would free up more than $60 billion a year in labor and capital for productive uses.

So the tax could raise some deficit-reducing revenue, while giving us a more efficient financial system. That’s something that Geithner should be willing to spend a few moments contemplating.

In a piece published yesterday, London’s Sunday Times provides an inside look at Goldman Sachs, the Wall Street behemoth that has not only survived the economic crisis, but is now thriving, with many of its chief competitors either out of business or swallowed by other firms. Goldman made a $3.19 billion profit last quarter, and the firm will likely set aside $21.9 billion for compensation this year.

Goldman’s CEO, Lloyd Blankfein, told the Times that the firm serves an important social purpose by helping companies grow. He also poo-pooed the idea that Goldman is only able to make such bumper profits thanks to government support:

Blankfein dismisses any suggestion that Goldman needed to be bailed out, and, by extension, rejects any notion that the firm is now profiting from public support. Sure, he took $10 billion from Washington’s Troubled Asset Relief Program (Tarp). But the bank has since repaid the cash, with healthy interest — 23%. Goldman also benefited from the federal bail-out of the huge US insurance firm AIG. Goldman had bought $20 billion worth of insurance from AIG and received billions of dollars — perhaps as much as $13 billion — when Washington pumped $90 billion into the stricken giant. But Blankfein insists Goldman was “hedged” against any AIG losses, in the best possible way — with cash.

Blankfein told the Times that he is just a banker “doing God’s work.”

Whoever’s work he is doing, Blankfein’s assertions that Goldman isn’t benefiting from government support seems to be at odds with history. After all, at the height of the crisis, Goldman was allowed to convert into a bank holding company — and access cheap money from the Federal Reserve — a status which it still holds, despite engaging in no lending activity at all. As Alan Schram, the Managing Partner of the Los Angeles based investment firm Wellcap Partners, wrote, “now that they are a regular commercial bank they actually trade more, which makes sense: if the US Treasury covered my losses, I would also be happy to take major risks.”

Plus, as Daniel Harrison pointed out at bNet, Goldman’s implicit guarantee as a “too big to fail” firm was likely the only thing that enabled it to raise capital last year:

At the time of the collapse of Lehman Brothers, Goldman was forced to raise $10 billion of fresh capital by selling a 15 percent stake in itself to Warren Buffett and other investors…Just days before the share sales — which directly allowed Goldman to stay afloat — the firm received around $12 billion in government aid…Presumably, if Goldman Sachs had been able to privately raise the initial $12 billion provided to it by the U.S. government, it would have done so. What seems much more likely is that the investors — including Buffett — who later agreed to commit an additional $10 billion only did so on the basis that the firm was reasonably supported by government aid.

Blankfein hasn’t hit all sour notes recently. He has been the foremost advocate on Wall Street for restructuring pay packages and he is also supportive of a resolution authority to unwind failing firms. But by living in this fantasy world in which Goldman’s success is due solely to its financial prowess, Blankfein is endorsing Goldman’s rocket-ride back to billion dollar profits on the backs of taxpayers.

Back in June, President Obama predicted that the unemployment rate would eventually hit 10 percent before the recession truly ended. Well, here we are.

Today, the Labor Department announced that the unemployment rate has hit a 26-year high of 10.2 percent, after employers shed 190,000 jobs in October. The wider U-6 measure of underemployment also ticked up to 17.5 percent, from 17 percent last month. The Labor Department also revised September’s losses down to 219,000 from 263,000. At the same time that joblessness continues to increase, productivity — output per hour worked — has soared (as employers make do with fewer employees).

Economist Dean Baker said that he did not expect declining unemployment rates until next spring. “We may be looking at very high levels,” Baker said, “barring a policy response, for several years into the future.” So as Brad DeLong asked “if you had told everyone last election day what would happen, economically, in 2009, what policies would they have adopted then to stem this disaster? And why aren’t we implementing those policies now?”

Indeed, there are positive steps that can be taken, now, that would support the labor market. As Matt Yglesias pointed out, we should probably be deploying more aid to state and local governments, to prevent layoffs and keep infrastructure projects up and running. (Let’s not forget that state aid was significantly reduced during negotiations over the stimulus package.) Paul Krugman, for his part, is advocating a WPA-style direct jobs program — “think of it as the stimulus equivalent of getting the middlemen out of the student loan program.”

Instead, as Steven Pearlstein wrote, “what [lawmakers are] proposing to do is to spend a lot of money that they don’t have in ways that won’t work to help too many people who are neither desperate nor deserving.” These ideas take the form of the badly misguided homebuyer tax credit, and the politically brilliant but economically pointless $250 payment to seniors.

Already, the response that we’ve seen from Congress has been fearmongering about deficits or using the unemployment rate as a nonsensical reason to kill health care reform. Neither of those provide much hope for some productive policy emerging. But if nothing is done, it’s going to be a long, painful slog back to a positive employment situation.

Friends of Coal (FOC) is a front group created by the West Virginia Coal Association. Its mission is to “inform and educate West Virginia citizens about the coal industry” and “provide a united voice” for the industry. To make dirty coal seem appealing, FOC has sponsored or initiated license plates, football games, basketball practices, plane jumps, fishing events, and scholarships.

FOC is now selling coal to children. ThinkProgress obtained the “Let’s Learn About Coal” coloring book, which asks children to unscramble statements about the “advantages” of coal, such as “Than coal other cheaper is fuels” (“Coal is cheaper than other fuels”). Kids also learn that coal is “important” and “provides jobs for lots of people!”:

The FOC Ladies Auxiliary has been handing the coloring book out to children around West Virginia as part of a “Coal in the Classroom” campaign. Coal officials go into schools and give presentations about the importance of coal. “We’d really like this to be statewide, that it be mandatory in the schools that they learn about coal,” said FOC ladies auxiliary president Regina Fairchild in January. The ladies auxiliary is also recruiting members for its “junior” FOC group, open to “girls and boys ages 8 to 16.”

Additionally, FOC ladies auxiliary members have visited children in West Virginia hospitals to give them a “special present“: Mr. Coal, “a small, black Labrador stuffed puppy meant to bring a smile to kids’ faces during hospital stays.” (Coal pollution kills 24,000 Americans each year.)

Last year, American Coalition for Clean Coal Electricity (ACCCE), another industry front group, also tried to make coal seem warm and fuzzy by creating the “coal carolers” — illustrated lumps of coal singing Christmas carols whose altered lyrics praised coal power. After widespread scorn, ACCCE took down the carolers. Find out more on what coal is really doing to Appalachia at Appalachian Voices.

Opponents of the Employee Free Choice Act (EFCA) like to portray themselves as the great defenders of democracy, protecting the “secret ballot” for workers everywhere. “There are sacred principles that epitomize American democracy,” wrote Rep. John Kline (R-MN), the ranking member on the House Ed. and Labor committee, while attacking EFCA. “They have private ballots in America, but not in other countries where there are tyrannies and socialism,” agreed Mark McKinnon of the Workforce Fairness Institute (WFI).

But now that the National Mediation Board (NMB) — which oversees labor-management relations for the airline and railroad industries under the Railway Labor Act (RLA) — wants to issue a rule change making unionization elections in those two industries more democratic, Kline and WFI are singing a different tune.

Currently, under the RLA, employees who choose not to vote in a union election are counted as “no” votes, while under the National Labor Relations Act (NLRA), employees who don’t vote simply aren’t counted at all. So, in practice, this means that employees under RLA must get a majority of employees to vote affirmatively, while those under NLRA must get a majority of voting members to do so, just like in an election for a political office.

The NMB wants to change the RLA’s rules, to equalize the two processes. Kline and WFI reacted like this:

Republican Reps. John Kline (Minn.) and John Mica (Fla.) issued a release that called it a radical proposal that adds “to a troubling perception that federal agencies have embraced a culture of union favoritism.” [...] The Workforce Fairness Institute issued a press release titled “Forced Unionization” in response to the proposed rule change, and criticized the NMB for providing a “bailout” to the AFL-CIO.

The NMB has opened its proposed change up to a 60-day comment period, and with their respective responses, Kline and WFI reveal that their opposition has nothing to do with democracy. It’s about preventing unions from gaining more members, at all costs. After all, in what other election do people who don’t vote get counted for one side or the other?

Much like the push in Congress to bring truck drivers for FedEx under the NLRA, this rule change would eliminate an odd inequity in the system that is the product of the antiquated RLA, which was written in 1934. There is no reason to have the deck stacked against railway and airline workers, simply because they are pulled under an older law. But to Kline and WFI, it seems, whichever rules make it harder to form a union are those that epitomize democracy.

Rep. Paul Kanjorski (D-PA) has turned some heads by proposing legislation that would give the federal government authority to break up any large financial institution that poses a systemic threat to the economy. According to Bloomberg News, Kanjorski is “coordinating with the European Union, which is forcing asset sales by state-aided banks to limit their advantage.” “Nowhere in the world in the future will there be gigantic tsunamis coming out of nowhere and striking the entire world’s economy,” Kanjorski said.

Under Kanjorski’s proposal, “the power to restructure a company could go to the systemic-risk council and involve the Treasury secretary, with a final decision made by the president.” This goes much further than the legislation proposed by either the administration or House Financial Services Chairman Barney Frank (D-MA).

The bill has already “set off alarms across K Street.” “That was a little unexpected,” one bank lobbyist told The New Republic’s Noam Scheiber. “It sort of…threw people for a loop.” However, Kanjorski has at least piqued the interest of one prominent player in the regulatory reform debate: Senate Banking Committee ranking member Richard Shelby (R-AL):

Senator Richard Shelby, the top Republican on the Senate Banking Committee, said today he liked the idea. “I don’t think anything is too-big-to-fail,” said Shelby, of Alabama. “We ought to be looking at legislation to deal with a bank beforehand if we can, or an institution that would cause systemic risk, to make it stronger, or make it smaller.”

Now, Shelby has already toyed with the Democrats, saying that he might be able to support creating a Consumer Financial Protection Agency (CFPA), only to characterize such a move as “folly and dangerous” when legislation started to move.

However, back in 1999, Shelby was the only Republican who voted against the repeal of the Glass-Steagall Act, which separated investment banking from traditional banking. And with the UK beginning to break up large, bailed-out financial institutions and more and more people talking about enacting some sort of wall between depository and investment banking, this seems like an issue that is not going to go away. For his part, Kanjorski said that he’s “getting some good feedback” on his measure. “Most people are coming up to me and saying we should have done this originally, why didn’t we?” he said.

It’s too soon to tell how this will all shake out, especially since Senate Banking Chairman Chris Dodd (D-CT) has yet to release his version of regulatory reform legislation. But Dodd is already planning to deviate from the House and the administration’s reform vision in significant ways. Will Shelby’s willingness to at least talk about breaking up the big banks push Dodd to go even further? And if he does, will Shelby be able to bring any other Republicans along?

Much like the U.S., the United Kingdom has been grappling with what to do about its bailed out, “too big to fail” banks. But unlike the U.S., the British are now telling the banks that are “too big to fail” that they are also too big to exist:

The British government — spurred on by European regulators — is forcing Royal Bank of Scotland, Lloyds Banking Group and Northern Rock to sell off parts of their operations. The Europeans are calling for more and smaller banks to increase competition and eliminate the threat posed by banks so large that they must be rescued by taxpayers, no matter how they conducted their business, in order to avoid damaging the global financial system.

The two banks are being forced to sell of hundreds of branches, credit card payment businesses, and online financial service companies. The mortgage giant Northern Rock, meanwhile, is being cleaved in two. According to Britain’s Treasury the forced divestments “together represent almost 10 percent of the UK retail banking market.”

One particularly interesting aspect of the British bank-busting is that the banks’ assets will be sold “only to new entrants to the British banking market to ensure more competition.” The American response to the financial crisis was to push failing institutions into the arms of other firms (like Merrill Lynch going to Bank of America), which has resulted in more consolidation, with previously “too big to fail” firms getting even bigger.

But as British Chancellor of the Exchequer Alistair Darling said, selling only to new entrants is the best way to ensure “proper competition and choice.” Having just “half a dozen big providers was not acceptable,” he added. The sales will take place over an extended period of time — at least three to four years — “so that the assets are not dumped at fire sale prices.”

Since RBS and Lloyds were 70 percent and 43 percent owned by the British government, respectively, the most direct comparisons for U.S. purposes are Citigroup and Bank of America, the two banking behemoths in which the U.S. taxpayer has a stake. So is it time to use that stake to forcibly unwind them as well?

“We still need to see exactly which parts the [British] banks will need to sell off to judge whether the goal of having smaller banks is really achieved,” said Richard Portes, an economics professor at the London Business School. “But there are lessons here for the United States. The supposed economies of scale of massive financial institutions are outweighed by the difficulties in controlling risk inside them.”

Indeed, as Felix Salmon put it, for these companies to be successful, they need to be boring — “the kind of companies that Warren Buffett has made his fortune by buying-and-holding.” But instead, we have let our perpetually bailed out banks (particularly Citigroup) go right back into the betting business, this time with taxpayer money. Breaking up three of its behemoths will not fix all that ails the super-concentrated British banking system. But at least for the U.S. banks which are still “too big to fail” and too weak to survive without government support, it may be time to follow the British model and force them to unwind.

For anyone hoping that the regulatory reform debate in the Senate was going to be less rancorous than that in the House, the last few days have provided ample evidence to the contrary. First, in what Tim Fernholz called “health care 2.0,” Republicans claimed that they’re being frozen out of the process, and complained that “they are being forced into an artificial timetable that is reducing the chances of agreement.”

And then there’s Sen. Richard Shelby (R-AL), the ranking member of the Senate Banking Committee. Back in October, Politico called Shelby “a deal maker,” and said that “he’s looking more and more like he’s ready to compromise [on reg. reform] — regardless of whether his party leaders want to slow walk a Democratic priority.” Politico even reported that Shelby “hasn’t shut the door” on the creation of a Consumer Financial Protection Agency (CFPA). However, now that Banking Committee chairman Chris Dodd (D-CT) is gearing up to release his bill, Shelby’s door seems to be shut pretty tight:

Shelby backs stronger consumer protections “where appropriate, but believes the creation of a stand-alone agency is neither necessary nor wise,” said Jonathan Graffeo, spokesman for the Republican lawmaker. As drafted, the proposed consumer agency in Shelby’s judgment “would make the system less safe,” Graffeo said.

This comes just a few days after Shelby called the very notion of a CFPA “folly and dangerous.” As Reuters put it, “the latest assessment of Shelby’s views shows that he and [Dodd] have a long way to go.”

It seems then, that Senate Republicans are going to reprise the House Republicans’ argument that consumer protection responsibilities should not be removed and placed within a new agency, but should instead remain with the same regulators who had them — and failed to use them — in the buildup to the economic crisis. As McClatchy’s Kevin Hall wrote, “that’s the back story to the U.S. financial crisis. At every turn where regulation was missing in action, the actors did the wrong thing, all along the long, interconnected trail of transactions that make up mortgage finance.” That seems to be the system that Shelby is arguing to preserve.

One intriguing aspect of the Senate dynamic, though, will be how the Republicans approach Dodd’s plan to consolidate all of the existing federal bank regulators into one super-regulator. House Financial Services Committee Chairman Barney Frank (D-MA) and the administration oppose such a move. With Democrats on either side, where will Shelby and co. come down?

When the H1N1 virus initially broke out back in April, the Centers for Disease Control and Prevention advocated that workers who contracted the illness stay home, a call which it has consistently repeated since then. However, the New York Times noted today that public health experts are worried about the continued spread of H1N1, as workers who deal with the public are “reporting to work sick because they do not get paid for days they miss for illness.”

Partially in reaction to the problems posed by H1N1, Congress is considering the Healthy Families Act — sponsored by Rep. Rosa DeLauro (D-CT) and currently sporting 113 co-sponsors — which would mandate that employers with more than 15 employees provide some paid sick leave. “Sometimes you talk about legislation in the abstract, but this is making people begin to understand the problem,” DeLauro said.

However, the Chamber of Commerce doesn’t seem to understand at all:

“The vast majority of employers provide paid leave of some sort,” said Randel K. Johnson, senior vice president for labor at the United States Chamber of Commerce. “The problem is not nearly as great as some people say. Lots of employers work these things out on an ad hoc basis with their employees.”

Actually, almost 50 percent of private-sector workers in the U.S. have no paid sick days. A survey last year by the National Opinion Research Center at the University of Chicago found that “68 percent of those not eligible for paid sick days said they had gone to work with a contagious illness like the flu.”

And this is a problem that disproportionately affects lower-income workers, 76 percent of whom have no paid sick leave. This includes 86 percent of food service workers and 78 percent of hotel workers, even though they, arguably, are most able to spread disease. As Ann O’Leary and Karen Kornbluh wrote in The Shriver Report: A Women’s Nation Changes Everything, “too often, most low- and many moderate-wage workers cannot access even the minimum benefits provided to more highly paid workers.”

The U.S. is the only developed country without a policy mandating some form of paid sick leave, while lost productivity due to sick workers attending work and infecting other employees costs the U.S. economy $180 billion annually. And the National Partnership for Women and Families actually found that “while a paid sick days policy would impose modest costs, the estimated business savings total $11.69 per week per worker from lower turnover, improved productivity and reduced spread of illness.”

So, in addition to catching us up with the rest of the world, mandated paid sick leave could be good for business. But the Chamber prefers to overlook low-income workers and real economic benefits in order to advocate for the perceived interests of large employers.

Yesterday, economist Robert Shiller — co-creator of the Case-Shiller housing price index and a professor at Yale — appeared on CNN to discuss Wall Street’s bonus bonanza and its implications for economic policy. Shiller is of the opinion that the bonuses are indicative of America’s greater problems with income inequality, which he feels will be become “bigger than this whole financial crisis” if left unaddressed:

To me, I would hope that this would spur public discussion about the structural problem that inequality, economic inequality, has been worsening in the United States and in other countries for 30 years. And it’s gotten really — especially at the high end — it’s gotten really off…This, I think, is potentially the big problem which is bigger than this whole financial crisis. If these trends that we’ve seen for 30 years now in inequality continue for another 30 years, we’re going to look like — it’s going to create resentment and hostility. It’s not a country that — we could turn into a country that even the rich would rather not be in. [...]

And I think we ought to think about — I have a proposal. I’ve talked about this in my other, some of my books. I have proposed that the government should index the tax system to inequality.

Watch it:

The income gap in America is at an all-time high, with the wealthiest 10 percent of Americans earning 11.4 times the amount made by those living near or below the poverty line in 2008. And most of that wealth is concentrated at the very top, as between 1979 and 2006, the inflation-adjusted after-tax income of the richest 1 percent of households increased by 256 percent (compared to 21 percent for families in the middle income quintile and 11 percent for the bottom). In 2007, the last year for which data is available, executives and other highly compensated employees received more than one-third of all pay in the U.S.

As The New York Times’ David Leonhardt pointed out, in recent years “the wealthy have received both the largest pretax raises and the largest tax cuts.” Under Shiller’s “Rising Tide Tax System,” tax rates would “automatically adjust along with levels of income inequality.” If the incomes of the middle class and the poor were growing faster than those of the rich, tax rates on the rich would fall. If the incomes of the rich were growing faster, their tax rates would rise.

I don’t see much of a chance of anything resembling Shiller’s plan making an appearance in Congress anytime soon. However, the surtax in the House’s health reform bill — which is still causing all manner of consternation — would help to address some of the inequality, by increasing taxes on the very wealthiest to pay, in part, for a bill that would rein in health care costs for everybody.

Back in January, the Republicans staked out their opposition to the administration’s economic stimulus package by claiming that it would cost $275,000 for every job created. “All told, the plan would spend a whopping $275,000 in taxpayer dollars for every new job it aims to create, saddling each and every household with $6,700 in additional debt,” said Rep. John Boehner (R-OH).

This number was derived by taking the entire cost of the stimulus package and dividing it by the number of jobs created in just one year, obviously inflating the per job cost a few times over. At the time, Paul Krugman called the Republicans’ number a “bogus talking point,” while Joe Klein dubbed it “phony-baloney propaganda.”

With the White House’s announcement last week that the stimulus package has thus far created 640,000 to 1 million jobs, the GOP is at it again. Don Stewart, spokesman for Sen. Mitch McConnell (R-KY), told reporters on Friday to “get out your calculators” and divide the spending by the jobs, ending with a figure of $230,769 per job. In addition to Republican lawmakers, Fox News, CNN, and CNBC have all repeated some variation of the number (using slightly different estimates) in the last few days. Watch a compilation:

The Associated Press’ Calvin Woodward, however, was not fooled, and today released a piece telling readers to “beware the math” coming from the Republicans:

Some Republican lawmakers critical of President Barack Obama’s stimulus package are using grade-school arithmetic to size up costs and consequences of all that spending. The math is satisfyingly simple but highly misleading…First, the naysayers’ calculations ignore the value of the work produced. Any cost-per-job figure pays not just for the worker, but for material, supplies and that worker’s output — a portion of a road paved, patients treated in a health clinic, goods shipped from a factory floor, railroad tracks laid. Second, critics are counting the total cost of contracts that will fuel work for months or years and dividing that by the number of jobs produced only to date.

As Woodward wrote, “dividing apples by oranges won’t settle” whether or not the stimulus package has been a success. But it seems to be good enough for the Republicans and all of the cable news hosts that they can get to listen.