Yesterday, President Obama all but endorsed the deficit reduction plan outlined by the Gang of Six senators. The plan still faces numerous obstacles — it’s incredibly vague on the details, has critics on both sides of the aisle, and may not even be ready by the Aug. 2 default deadline. Liberal Democrats have pointed out the plan is far from a balanced approach, asking seniors and the working poor to bear the brunt of the pain without asking the wealthy or corporations to sacrifice at all.

Two members of the Gang of Six, Senators Saxby Chambliss (R-GA) and Kent Conrad (D-ND) were positively crowing about the conservative bona fides of their plan yesterday on MSNBC. Because the proposal will actually be scored as a $1.5 trillion tax cut under current law (with the Bush tax cuts set to expire in 2012), they are confident that House Republicans, who have vowed never to vote for a tax increase, will go for it.

Watch it:

The Congressional Budget Office will score the plan as a $1.5 trillion tax cut, as it lowers the corporate tax rate from 35 percent to between 23 and 29 percent, eliminates the alternative minimum tax, and lowers personal income tax rates. But by closing loopholes, the Gang of Six says they’ll raise $1.3 trillion in revenue.

The disparity can only be explained because they employ an accounting gimmick — the two projections use different CBO baselines. The tax cut number is compared to current law, which assumes the Bush tax cuts will expire and the AMT will take effect, neither of which seems likely to happen. The revenue number is compared to a “plausible baseline” (which assumes expiration of the high-end Bush tax cuts).

The plan also recommends “reforming” Social Security in ways that will even affect current retirees. But not a penny of the money saved will go to deficit reduction, which begs the question — why include Social Security at all? The Gang of Six has said all the changes will go toward securing the long-term financial security of the program, but Social Security is already solvent until 2037 and does not contribute to the deficit.

The cuts in the Gang of Six plan aren’t minor, either. It proposes a chained CPI adjustment to Social Security, which may not be a bad idea when combined with other measures to boost benefits and strengthen the program, but on its own is tantamount to a $1,300 cut each year for recipients over their lifetimes. Strengthen Social Security co-chair and former Obama adviser Nancy Altman has denounced the idea as an overly harsh cut. “The chained-CPI is poor policy, and given that seniors vote in disproportionately high numbers, it is equally poor politics,” she said.

Yesterday, the National Mediation Board, which oversees labor-management relations under the Railway Labor Act (RLA) changed an antiquated rule for RLA union elections, which stated that a majority of all workers — including those on furlough, military leave and extended medical leave — had to approve the union, instead of a majority of voting members. So workers who didn’t cast a vote were counted as voting against the union.

The NMB’s ruling means that, henceforth, RLA elections operate like any election for political office, with uncast ballots simply not being counted. But the companies affected by the change, particularly those in the airline industry, liked the higher bar for unionization set by the previous rule. So the Air Transport Association — acting on behalf of Delta Airlines, Jet Blue, and United Airlines, among others — has launched a lawsuit to try and prevent the rule change from being implemented.

And yesterday, Georgia’s two Republican Senators, as well as the ranking member of the House Education and Labor committee, threw their support to the corporations trying to keep the bar for unionization unjustifiably high:

– Sen. Johnny Isakson (R-GA): I will use all available tools at my disposal…to see that this assault on employee rights does not stand.

– Sen. Saxby Chambliss (R-GA) said he would “continue to work to see that this change does not stand.”

– Rep. John Kline (R-MN), “also slammed the rule change, saying the board ‘imposed a quick fix at the behest of organized labor.‘”

I’d like to see what these lawmakers think of a proposal to count all uncast votes towards their opponent’s total in their next election. That, after all, is the system that they are trying to preserve.

Of course, despite their appeals to “employee rights,” the GOP’s opposition is really about protecting the corporations that may be affected. Delta, which is largely non-union, has its headquarters in Atlanta, Georgia, and is currently the largest contributor to Isakson’s reelection campaign. It is the fifth largest contributor to Isakson in his career.

This is very similar to Sens. Bob Corker (R-TN) and Lamar Alexander (R-TN) fighting to preserve an inequity in labor law that makes it more difficult for drivers at Memphis-based Federal Express to unionize. And the end goal of all these efforts is to keep in place rules that arbitrarily deny collective bargaining rights to workers who legitimately want them.

As I pointed out earlier, Republicans are planning to offer an amendment to Sen. Chris Dodd’s (D-CT) financial regulatory reform bill that would forbid a new consumer protection regulator from enforcing its rules for any institution that is not a “large non-bank mortgage originator,” leaving most of the financial system outside of the regulator’s reach. This fits with the broader GOP theme on consumer protection, which is to say that, if it gets boosted at all as a result of regulatory reform, it should remain a second-order issue, after the profitability of banks.

But that doesn’t stop Republicans from complaining about consumer protection measures that they claim are missing from Dodd’s bill. For instance, Sen. Saxby Chambliss (R-GA) took to the Senate floor today to criticize Dodd for not including standards for mortgages in his bill, but still taking a swipe at the consumer protection portion of Dodd’s legislation in the process:

There are no mortgage standards that are specifically set forth in the underlying bill…Certainly, we need standards in place, to ensure that people who are buying houses can afford to make the mortgage payments that they are making application for. And with respect to the consumer financial protection act, it appears that in the underlying bill there is an umbrella that is cast out there that is going to require the inclusion of more non-problem areas of the consumer finance industry.

Watch it:

For months, Republicans derided the Democrat’s attempt to create a new consumer protection regulator, saying that it would decree what financial products (including mortgages) people could have. The cacophony was so loud that a provision in the House of Representative’s financial reform bill mandating that banks offer consumers a plain “vanilla” product — a standardized version of whatever the consumer is looking for — before moving onto more complicated products was dropped.

But now Chambliss is advocating that Congress come up with a plain vanilla mortgage. This could be a good idea! But why is the GOP so intent on focusing solely on mortgages, when there were consumer abuses across the financial sector? Banks and non-banks alike are able to rip off consumers with a host of financial products, making a regulator with the ability to write and enforce regulations against all of them a critical addition to the regulatory system.

The GOP is flailing on consumer protection because it doesn’t want to do anything that will cut into the ability of banks to make a profit on confusing, obfuscatory financial products. But it also can’t deny that many people were hurt by the bank’s use of products that should have never been sold. So they’re left trying to call for prudential standards in one slice of the system, while leaving the rest of the system in the dark and unregulated, allowing the banks to run rampant.

Today, the Senate began debate on financial regulatory reform, after Republicans finally agreed to end three days of obstruction last night and allow the bill to come to the floor. Ever since regulatory reform first began to move through the House of Representatives last year, the GOP (and its allies in the big business community) have sought out sympathetic figures that it (falsely) claims the legislation will have an adverse effect upon. Florists, churches, and the makers of Snickers bars have all had their moment, and today’s choice is community bankers.

First, Sen. Saxby Chambliss (R-GA) appeared on MSNBC to decry the effect of derivatives regulation on community banks. Then, Sen. Richard Shelby (R-AL), the ranking member of the Senate Banking Committee, went to the Senate floor to claim that resolution authority — the proposed mechanism for unwinding large, failed financial firms — would give large banks an advantage over their smaller counterparts. Watch a compilation:

Neither of these concerns has a basis in reality. Chambliss is worried about the effect of derivatives reform when 97 percent of the activity in the $300 trillion derivatives market is undertaken by just five mega-banks: JP Morgan Chase, Bank of America, Goldman Sachs, Citigroup and Wells Fargo. I’m not sure what sort of derivatives trading Chambliss thinks is occurring at the community level, but reform should make it cheaper for businesses to use derivatives to legitimately hedge against risk.

As for Shelby’s concern, the fact that resolution authority will enable the very biggest banks to fail (instead of being propped up by the government) should benefit smaller banks — which already have a mechanism in place for when they fail — by removing the big firms’ implicit government guarantee.

But if the GOP is really concerned about the effect of regulatory reform on community banks, then it should be embracing the push to levy a bank tax on the biggest financial firms. This would help level the playing field by making it more expensive to be a large interconnected firm (offsetting some of the funding advantages that such size conveys). The Congressional Budget Office has said that a bank tax would “improve the competitive position of small- and medium-size banks, probably leading to some increase in their share of the loan market.”

Of course, the GOP has shown no inclination to support a bank tax. In fact, it has actively scoffed at the idea. But Sen. Max Baucus (D-MT), chairman of the Senate Finance Committee, said earlier this week that “I don’t think there’s much doubt that there will be a bank tax.” So will Chambliss and Shelby jump on board?