Congress gave President Obama most of what he asked for, as the House and Senate voted largely along partisan lines for different versions of the $3.6 tln blueprint that increases taxes on the wealthy and funds Obama’s plans for health care, energy and education. The House passed the budget 233-196 and the Senate approved it 55-43. No Republican voted for the budget in either chamber. Twenty House Dems, mainly conservatives but also including Dennis Kucinich (Ohio), voted against the budget while two Dems, Ben Nelson (Neb.) and Evan Bayh (Ind.) voted against it in the Senate. (Kucinich objected to war funding.)
Republicans put up a budget alternative that would rescind Obama’s $787 bln stimulus package in 2010, privatize Medicare, cut corporate tax rates to 25% and permanently extend the Bush-era tax cuts for the wealthy. It was voted down 293-137, with 38 Republicans joining 255 Dems in voting against the GOP plan.
One of the differences was a Senate amendment by Sen. Blanche Lincoln (D-Ark.) and Jon Kyl (R-Ariz.) that would cut taxes on multimillion-dollar estates. On a 51-48 vote the Senate would exempt $10 mln estates from tax. Larger estates would be taxed at 35%. Obama proposes exempting estates up to $7 mln and tax larger ones at 45% instead of the $2 mln exemption and 55% rate slated to take effect in 2011. The Lincoln-Kyl tax break would help heirs of the top 0.2% of estates.
The Democratic budget includes a deficit of $1.2 trillion, but that doesn’t seem to bother the public. In late March a Democracy Corps poll found that 61% agreed that “it is more important to make investments that will lead to new jobs and industries and create economic growth.” And 63% agreed that “Obama is right to seek solutions on health care, energy and education while still making the economy his top priority.”
While Republicans are trying to blame Obama for the economic troubles, a Washington Post/ABC News Poll (3/26-29) found that 70% said the Bush administration should be blamed for “a great deal” or “a good amount” of the nation’s economic situation. Only 26% blamed Obama.
A CBS/New York Times poll (4/6) showed Obama approval at 66% while only 31% had a favorable view of the GOP, lowest in the 25 years the question has been asked. Also, despite faux populist attacks on Obama by Republicans, 71% said Obama cares more about protecting the interests of ordinary working people while 17% said he cares more about protecting large corporations. Three-quarters said big business has too much influence on the GOP, while 56% said big business has too much influence on the Dems.
DEFENSE BUDGET CHANGES PRIORITIES. Defense Sec’y Robert Gates on 4/6 announced cuts to big-ticket weapons projects, including the F-22 Raptor and the VH-71 presidential helicopter, as well as the Navy’s DDG-1000 destroyer, airborne laser missile defense and the Army’s Future Combat Systems. The $663 bln budget increases the Army and Marine Corps and expands intelligence, surveillance and helicopter programs that have performed well in Iraq and Afghanistan—including the Predator drone used by the CIA to attack extremists in neighboring Pakistan—as well as support for counterinsurgency development.
“This is a reform budget,” said Gates, a holdover from the Bush administration. Several defense reformers agreed, according to Spencer Ackerman of WashingtonIndependent.com. “The boom finally lowered on the Pentagon’s budget today,” said Laura Peterson, defense budget analyst at Taxpayers for Common Sense. “We applaud [Gates’] rigor in wielding the budget axe.” Robert Work of the Center on Strategic and Budgetary Assessments called it a “very, very encouraging first step.” Winslow Wheeler of the Center for Defense Information was more cautious, but said “Secretary Gates deserves much good credit,” especially for making warfighter support “his first priority.” Taxpayers for Common Sense estimated at least $108.4 bln in cuts to existing programs, but increases in other programs are expected to make up that difference.
Lockheed Martin scrambled to defend the F-22 fighter, which costs $143 mln per plane for the 183 delivered. Lockheed and its defenders argue that the jet was a jobs engine during trying economic times, Spencer Ackerman of WashingtonIndependent.com noted. “Defenders of the Army’s Future Combat Systems program for tech-enabled land warfare—the target of a Government Accountability Office report ... that criticized its ‘staggering’ cost-overruns of $300 mln — have argued in recent days that the program is crucial to soldier safety against insurgent attacks, even though it has yet to be deployed in full,” Ackerman wrote. Politico.com reported that Boeing has deployed 100 lobbyists to Washington to push back against potential cuts.
LINCOLN JOINS FILIBUSTER OF EMPLOYEE CHOICE. Sen. Blanche Lincoln (D-Ark.) became the first Dem to announce that she would not support the Employee Free Choice Act (4/6), putting another nail in the coffin of the AFL-CIO labor federation’s highest priority in this Congress. “I cannot support that bill ... in its current form,” she said in Little Rock, adding that she would not support moving it forward. Wal-Mart is among its biggest opponents. Previously, Sen. Arlen Specter (R-Pa.), who has supported similar bills, crumbled in the face of a GOP primary challenge from the right next year. Labor allies need 60 votes in the Senate to overcome the “filibuster.” If Republicans keep their 41 senators in line, plus Lincoln, that likely would kill the bill for this session.
SENATE GETS SINGLE-PAYER BILL. Sen. Bernie Sanders (I-Vt.) has introduced a single-payer health-reform bill, the American Health Security Act (S. 703), which would cover all Americans, eliminate co-pays and deductibles and restore free choice of physicians or hospitals. The program is paid for by combining current government health spending into a single fund with modest new taxes amounting to less than what people now pay for insurance premiums and out-of-pocket expenses. It would be comprehensive, including dental and mental health and prescription drugs. While federally funded, it would be administered by the states. By eliminating the high overhead and profits of the private, investor-owned insurance industry, the plan saves at least $400 bln annually, enough money to provide comprehensive, quality care to all, according to Physicians for National Health Program. The bill parallels HR 1200, sponsored by Rep. Jim McDermott (D-Wash.), but Sanders’ bill includes money for community health centers and resources for the National Health Service Corps to train 24,000 health professionals. Another bill, HR 676 by John Conyers (D-Mich.) would expand and Medicare to cover everybody.
The single-payer bills stand in contrast with reform models offered by the White House and Sens. Max Baucus (D-Mont.) and Edward Kennedy (D-Mass.), which would preserve a central role for the private insurance industry. A January CBS News/New York Times poll found 59% preferred national health insurance while 32% preferred private enterprise.
The Congressional Progressive Caucus sent a letter to House Speaker Pelosi (4/2) noting that “virtually the entire” 77-member caucus prefers a single-payer approach. At a minimum, caucus co-chairs Lynn Woolsey (D-Calif.) and Raul Grijalva (D-Ariz.) urged the inclusion of a public plan to compete with private health insurance plans. Republicans are expected to fight the public insurance option.
MSNBC ADDS LIB TALKER SCHULTZ. MSNBC added another progressive voice to its lineup as it placed veteran radio talker Ed Schultz in the 5 p.m. CT slot, starting 4/6. Schultz, who syndicates his 11 a.m. to 2 p.m. CT radio show on about 100 stations, had been a frequent guest on cable shows. “I’m excited to have this opportunity with MSNBC,” Schultz said in a press release (4/1). “I look forward to having a day to day discussion with fellow Americans on issues that really matter to all of us.” Ironically, while the cable TV show is more prestigious, Schultz has more listeners on radio. He claims more than 3 mln weekly listeners, compared with less than 400,000 who watch the 5-6 p.m. MSNBC show previously hosted by David Shuster, who moved to the afternoon news. Keith Olbermann has the highest viewership on MSNBC, with 1.34 mln, followed by Rachel Maddow with 1.13 mln (3/31). Schultz, a veteran of 30 years in broadcasting, will continue with his 6-year-old radio show, which recently moved from Fargo, N.D., to Washington, D.C., and now moves on to New York City.
SICK AT PBS. Last year T.R. Reid, former reporter for the Washington Post, made a documentary, “Sick Around the World,” that examined “health care for all” programs in Britain, Japan, Switzerland, Germany and Taiwan for PBS Frontline. What all five countries had in common, he found, was that none allowed for-profit health insurance companies to sell basic medical coverage. But Russell Mokhiber reported for Corporate Crime Reporter (4/2/09), Frontline then asked Reid to make a companion documentary about health care in the US, called “Sick Around America.”
The documentary aired 3/30 on PBS, but it did not present Reid’s bottom line for health care reform—that for-profit health insurance companies be cut out of basic health insurance. Instead, the film pushed the view that Americans be required to buy insurance from for-profit companies.
Reid told Mokhiber he spent months shooting the film and did his last interview on 1/6. When he saw the completed documentary in late February, he said he would not appear in the film that contradicted his previous film and his book, The Healing of America: A Global Quest for Better, Cheaper and Fairer Health Care (Penguin Press, August 2009). So they parted ways.
“Doctors, hospitals, nurses, labs can all be for-profit,” Reid told Mokhiber. “But the payment system has to be non-profit. All the other countries have agreed on that. We are the only one that allows health insurance companies to make a profit. You can’t allow a profit to be made on the basic package of health insurance.” (See corporatecrimereporter.com.)
‘MARRIAGE MECCA’ POTENTIAL BOOM. After the Iowa Supreme Court overturned a ban on same-sex marriages (4/3), Iowa’s brief notoriety as the “Gay Marriage Mecca,” as right-wing Rep. Steve King (R-Iowa) styled it, was diminished on 4/6 when the Vermont House and Senate overrode Gov. Jim Douglas (R)’s veto of a bill legalizing gay marriage. But Iowans still think they can make money off the opening. Des Moines Register columnist John Carlson, possibly with tongue in cheek, advised Iowa’s conservatives (4/5) to remain calm and “Figure a way to make some money on the deal, even if it hurts.” He envisions hotels and restaurants in Mississippi River cities jammed with gay wedding parties from Chicago while flashy wedding chapels line Fleur Drive or SW 9th St. in Des Moines to accommodate wedding tourists flying in from around the country. [Dispatches thinks Storm Lake or Lake Okoboji, popular vacation sites in Northwest Iowa, would provide great wedding sites—and they’re both in King’s district!]
Carlson noted that Las Vegas wedding chapels charge $300 to $400 for a basic wedding, “and you ought to see how fast they move people in and out of those chapels. The Graceland Wedding Chapel, for instance, offers services in English, Spanish and French. It has both civil and religious services, with an ordained minister on staff. It even has an Elvis impersonator. Think of all the out-of-work preachers and wannabe Elvises in Iowa who could use a gig like that.”
For the record, a 2008 study by UCLA researchers said Iowa businesses could see $160 mln in new wedding and tourism spending over the next three years, since the Hawkeye State has the Midwest all to itself, Grant Schulte reported in the Des Moines Register (4/5).
DEBTORS’ PRISONS COMEBACK. Cash-strapped governments are getting tougher about forcing poor people to pay court costs and fees, including the costs of locking them up. The New York Times (4/5) noted that Edwina Nowlin, a poor Michigan resident, was jailed when she was unable to reimburse a juvenile detention center $104 a month for holding her 16-year-old son. She was held 28 days before the American Civil Liberties Union of Michigan helped her get out.
The Supreme Court in 1970 ruled that inmates could not be held in prison extra time because they are too poor to pay a fine or court costs. More recently, the Times noted, the court ruled that a defendant’s probation cannot be revoked for failing to pay a fine if he is unable. But that has not stopped the practice, as George often sends poor people to jail who cannot pay fines, plus a monthly fee to the private company that collects the payments.
NO CORPORATE PRISON. Pfizer reached agreement with Nigeria to pay millions of dollars to settle a criminal case alleging that the drug company illegally tested an experimental drug on gravely ill children during a 1996 meningitis epidemic and falsified a key document, the Washington Post reported (4/4). Nigerian authorities in 2007 filed civil and criminal actions, including homicide, against Pfizer and 10 individuals, including Pfizer’s former CEO, charging that the unauthorized use of the antibiotic Trovan killed 11 children and disabled scores more. The Post reported that the total payments is believed to be about $75 mln but lawyers said Pfizer set a number of conditions that remain undisclosed. Trovan was never approved for use by American children. The Food and Drug Administration approved it for adults in 1998 but later severely restricted its use after reports of liver failure. The European Union banned the drug in 1999.
OIL LEASE DISRUPTER FACES FELONIES. Tim DeChristopher, the student who disrupted a lease of public lands in Utah for oil and gas exploration by bidding up prices against those who intended to drill, has been indicted on federal felony charges in connection with the incident, even though the Obama administration nullified the auctions that the Bush administration tried to hurry through. DeChristopher faces up to 10 years in prison and a $750,000 fine on charges of making a false statement to the government and violating the Federal Onshore Oil and Gas Leasing Reform Act, even though supporters put up the money to cover his winning bid. The Bureau of Land Management was unable to accept DeChristopher’s payment because by then the leases had been nullified, but charges were brought by US Att’y Brett Tolman, a holdover from Bush’s scandal-plagued Justice Department. “What he did caused no harm at all to anyone—except a bunch of corporate crooks trying to rip off the government,” Paul Rosenberg wrote at OpenLeft.com (4/4). (See DeChristopher’s website at bidder70.org.)
DOPE DISPENSERS GET MORE PRISON THAN AL QAEDA SPY. A former US sailor was sentenced (4/3) to 10 years in prison, the maximum sentence possible, for informing al Qaeda of secret US ship movements, which potentially could have enabled an attack similar to one carried out in 2000 against the USS Cole, which killed 17 US sailors. Jeralyn Merritt of TalkLeft.com noted that several months ago in California, two 28-year-olds who operated a medical marijuana dispensary were each sentenced to 20 years in prison, the mandatory minimum. “Does anyone not see something wrong with this picture?” wondered Merritt, a Denver criminal defense lawyer.
JUDGE BERATES ‘JUSTICE.’ In dismissing charges against former Sen. Ted Stevens, US District Judge Emmett Sullivan ordered an investigation of the Justice Department attorneys who prosecuted Stevens. “In nearly 25 years on the bench, I’ve never seen anything approaching the mishandling and misconduct that I’ve seen in this case,” Sullivan said in a stinging summary of the many times the government withheld evidence or mishandled witnesses in the case, the Associated Press reported (4/7). The judge said he has seen a troubling trend of prosecutors withholding evidence in cases against people ranging from Guantanamo Bay detainees to public officials such as Stevens. He called on judges nationwide to issue formal orders in all criminal cases requiring that prosecutors turn over evidence to defendants. It was a stinging rebuke of the Justice Department and Sullivan called on Att’y Gen. Eric Holder to order training for all prosecutors.
While Stevens goes free, Scott Horton wrote at Harpers.org (4/7) that “the misconduct of Bush-era prosecutors in the Stevens case is child’s play compared to what was done in the prosecution of former Alabama Gov. Don E. Siegelman, Mississippi lawyer Paul Minor, judges Walter Teel and John Whitfield, and a half dozen other cases profiled [at Harpers.org]. So the question rests with Holder: when is he going to do something to rectify the mess he inherited? Judge Sullivan is right about the solution: it starts with education. Remind the government lawyers that they cannot wield their power corruptly or unethically without consequences. And make clear that unethical conduct will be dealt with swiftly and harshly, not swept under the carpet as it has been for the last eight years.”
Siegelman (D) still faces imprisonment after being convicted by Bush’s Justice Department in 2006 on charges that he appointed health service executive Richard Scrushy to a state regulatory board in return for a contribution to a foundation Siegelman supported. Siegelman claims prosecutorial misconduct in his case included the involvement of US Att’y Leura Canary, wife of a fierce opponent of Siegelman, failure to disclose prosecutors’ coaching of the key witness against Siegelman and failure to disclose evidence of jury misconduct. A three-judge panel of the 11th Circuit US Court of Appeals (3/6) upheld bribery, conspiracy and obstruction of justice convictions against Siegelman but threw out two mail fraud counts. Siegelman has asked for a rehearing by the entire court.
TURMOIL IN AK GOP. Gov. Sarah Palin (R) joined the Alaska Republican Party in calling on Sen. Mark Begich (D-Alaska) to quit so that former Sen. Ted Stevens (R-Alaska) can run against him in a special election now that the Obama administration has decided not to prosecute Stevens for concealing $250,000 in gifts Stevens received from an oil industry executive and other friends. Rep. Don Young (R-Alaska) dismissed those demands as “a lot of noise,” since Begich won the race and has taken office. But Young added, “Personally, I’d like to see him run for governor, and that’s my personal feeling,” Young told Alaska Public Radio. “So, we’ll see what happens down the line. He probably won’t, but I think that would be a great way to cap off a great career as being the governor of the state of Alaska.” Palin endorsed a primary challenger against Young last year and then refused to support his bid for re-election.
JOBLESS BENEFITS RUNNING OUT. Hundreds of thousands of jobless Americans will exhaust their unemployment benefits, just when it’s never been harder to find a job, the Associated Press noted (4/4). Congress extended unemployment benefits twice last year, allowing people to draw up to 59 weeks of benefits, but Wayne Vroman, an economist at the Urban Institute, told AP that up to 700,000 people could exhaust their benefits by the second half of this year, as the jobless rate approaches double digits. Since the recession began in December 2007, 5.1 mln jobs have disappeared, including 663,000 in March, as the jobless rate stood at 8.5%. If the downturn continues into May, it will be the longest recession since the Great Depression of the 1930s.
‘ANGRY’ McCAIN SCOLDS HISPANIC BUSINESS LEADERS. While meeting with a group of Hispanic business leaders at the US Capitol in March, Sen. John McCain (R-Ariz.) got “angry” and at one point began referring to Hispanics as “you people” while talking about how Hispanic voters failed to support him after he pushed immigration reform, *National Journal* reported (4/4). “He was angry,” one source told the *Journal*. “He was over the top. In some cases, he rolled his eyes a lot. There were portions of the meeting where he was just staring at the ceiling, and he wasn’t even listening to us. We came out of the meeting really upset.” McCain’s message was obvious, the source continued: After bucking his party on immigration, he had no sympathy for Hispanics who are dissatisfied with President Obama’s pace on the issue. “He threw out [the words] ‘You people—you people made your choice. You made your choice during the election,’ ” the source said. “It was almost as if [he was saying] ‘You’re cut off!’ We felt very uncomfortable when we walked away from the meeting because of that.”
Sens. John Thune (R-S.D.) and Mel Martinez (R-Fla.), who were at the meeting, and McCain communications director Brooke Buchanan disputed the idea that McCain lost his temper.
‘POST’ STILL WANTS TO CUT SOCIAL SECURITY. The Washington Post continues its efforts to reduce Social Security benefits with an article (3/31) headlined “Recession Puts a Major Strain on Social Security Trust Fund.” The article refers to Congressional Budget Office (CBO) projections that annual tax revenue will be nearly in balance with benefit payments for the next several years. Previous projections had shown large surpluses. “While those seeking to cut Social Security benefits are highlighting these new projections,” Dean Baker explained at Prospect.org (3/31), “in reality they have very little significance for the program. Under the law, Social Security benefits are paid out of its trust fund. This trust fund has accumulated a surplus of almost $2.5 tln. The lower projected surpluses for the next few years will have some impact (if the projections prove correct) on the date at which the fund is projected to be depleted, but the projected depletion date will almost certainly be beyond 2040, even after CBO adjusts its numbers for the downturn.”
Baker added that the article “alludes to plans to cut benefits without ever noting that older workers and retirees have just lost close to $15 tln in wealth due to the collapse of the housing bubble and the plunge in the stock market Presumably this would be an important factor in any debate over reducing benefits.”
BUSH’S PENSION ‘REFORM.’ Just months before the start of last year’s stock market collapse, the Federal Pension Benefit Guaranty Corp., which insures retirement funds for 44 mln Americans, decided to shift much of its $64 bln in holdings from relatively low-risk bonds to equities, in search of higher returns, the *Boston Globe* reported (3/30). The agency decided to pour billions of dollars into speculative investments, such as stocks in emerging foreign markets, real estate and private equity funds. The fund was down 6.5% for the year ending 9/30/08, but the agency refuses to say how the fund has fared since then, when most of the recent stock market decline occurred, and when the investment switch was to begin in earnest. Analysts expressed concern that large portions of the trust fund may have been lost at a time when many private pension plans are suffering major losses. The guaranty fund would be the only way to cover pensions if companies go into bankruptcy. Peter Orszag, head of the White House Office of Management and Budget, who flagged the problem last year when he headed the Congressional Budget Office, has “serious concerns” about the agency, the *Globe* reported.
Charles E.F. Millard, a former managing director of Lehman Bros., was the agency director who implemented the strategy until the Bush administration departed on 1/20. He dismissed concerns, saying flatly that “the new investment policy is not riskier than the old one.” Asked whether the strategy was a mistake, given the subsequent declines in stocks and real estate, Millard said, “Ask me in 20 years. The question is whether policymakers will have the fortitude to stick with it.”
`David Kurtz noted at TalkingPointsMemo.com (3/30), “Bush was able to do for the PBGC what he tried and failed to do for Social Security.”
INFO BUY-WAY? As broadband internet access becomes an increasingly important part of our everyday lives, telecom companies have become increasingly involved in politics by contributing to state-level candidates and hiring thousands of state-level lobbyists. A new report from the National Institute on Money in State Politics (FollowTheMoney.org) shows that from 2001 through 2007 five companies (AT&T, Verizon, Qwest, Embarq and US Cellular) contributed nearly $28 mln to state candidates, party committees and ballot measures in all 50 states. The companies also hired nearly 2,600 lobbyists in 2006 and 2007.
AT&T and Verizon contributed the most to candidates, state party committees and ballot measures, giving $14.8 mln and $10.7 mln respectively, followed by Qwest’s $1.9 mln. The majority of the money (78% or $22 mln) was given in 10 states: California, Florida, Texas, Illinois, South Dakota, Virginia, New York, Pennsylvania, Indiana and Missouri. California received the lion’s share, $8.2 mln. Contributions to candidates accounted for $14.5 mln of the total contributions made by these companies, divided almost equally between parties. Republican candidates received $7.6 mln; Democratic candidates $6.8 mln.
Communications companies gave $6 mln to state Republican parties and $3.5 mln to state Democratic parties. The companies also contributed $4.1 mln between 2004 and 2007 in hopes of influencing the outcome of ballot measures in 14 states.
AT&T hired the most lobbyists (1,373) and US Cellular hired the fewest (26).
The nonprofit, nonpartisan FollowTheMoney.org collects and analyzes campaign contribution information for state-level candidates, political party committees and ballot committees and provides a free, searchable database.
NO ‘LIGHT SWITCH TAX.’ Sen. Judd Gregg (R-N.H.) adopted a Republican talking point in a Washington Post column (4/1) when he argued that President Obama’s budget includes a new “light switch tax” on electricity bills. The new catch phrase started popping up after the House Republican Conference said in a press release that the administration supports “a light switch tax that would cost every American household $3,128 a year.” Brian Beutler explained at TalkingPointsMemo.com (4/1), “There is, of course, no such tax in the president’s proposal or the budget resolution, and nor could there be. Obama’s proposal contemplates revenue from a cap-and-trade bill, and there *is* a deficit neutral reserve fund for future climate change legislation in the resolution, but even that section was amended last night to provide that any increased energy costs would be offset by cap-and-trade revenue.”
PolitiFact.com, a project of the St. Petersburg, Fla., *Times*, also scrutinized the Republican claim and described it as a “pants-on-fire” kind of lie. John Reilly, an energy, environmental and agricultural economist at MIT and one of the authors of the report cited by congressional Republicans, said “It’s wrong in so many ways it’s hard to begin,” but there was an estimated net cost to individuals of the cap-and-trade program, called the “welfare” cost, of $30.89 per person in 2015, or $79 per family with 2.56 people. The cost would grow over time, but the average annual cost over time in today’s dollars—that is, the “average annual net present value cost”—is still just $85 per person, Reilly said. That would be $215.05 per household. A far cry from $3,128. And that isn’t the only inaccuracy in the claim...”
The Republican claim isn’t just an error or a mistake, and it’s not a subjective question open to interpretation. The GOP talking point is an obvious and transparent lie.
From The Progressive Populist, May 1, 2009
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