I don't know Chris Dodd well, but have always liked him quite a bit. I appreciated his advocacy on behalf of children, on civil rights and civil liberties, and on many other important issues. I thought he was a great DNC chair back in the '96 cycle. I knew that his closest friends on the Hill were Ted Kennedy and Rosa DeLauro, who have always been two of my favorite people. I thought he ran an honorable and strongly progressive campaign for President in 2008.
But lately, it seems like Chris Dodd has been taken over by a Wall Street pod person. He repeatedly tried to make major compromises to please the big banks in the financial reform bill, saying that the bill could not pass without these changes when in fact the bill got steadily stronger on the floor of the Senate, and the Republicans were always too scared to filibuster it. He has come out strongly against filibuster reform. And now he is mounting a major campaign to defeat Elizabeth Warren, both with public statements (for a while using the filibuster excuse, now just blatantly questioning her ability to do the job) and especially in private. Based on everything I am hearing from insiders at the White House and Capitol Hill, the two people who are most anxious to keep the President from nominating Warren are Geithner and Dodd.
What is going on with Dodd? I am told by extremely good sources that he remains extremely angry with Warren for daring to push back against the compromises gutting the consumer protection bureau, so that at least is one reason. More disturbingly, some are suggesting that he feels like he needs to carry water for the White House on this, so that they have a good excuse not to pick her, although I am more skeptical of that idea because I know there is a strong contingent at the White House that favor her nomination as well as some who oppose. Finally, the DC rumor mills have been ablaze for months that Dodd is looking at a lobbying career when he retires, and as former chair of the Senate Banking committee, he could be in line for some pretty sweet contracts with the big banks.
Whatever the reasons, this is a very disappointing way for someone with an honorable career like Dodd to go out on. I hope he steps back from the dark side.
Before he leaves the Senate, Chris Dodd is waging a rearguard effort to try and prevent Democrats from changing the cloture vote threshold next year. Ryan Grim:
Chris Dodd gathered with the Democratic Senate freshman class on Tuesday night at a dinner organized by Mark Warner to persuade them to back off their push to change Senate rules when the chamber returns in January, the first opportunity there will be to do so.
Dodd, who is giving up his Connecticut Senate seat following a 36-year congressional career, argued that those who have yet to serve in the minority should be careful tampering with the rules.
First, if Dodd is making speeches in favor of keeping the cloture vote threshold at 60, that shows there is a lot of momentum for lowering the threshold. Second, his argument in favor of keeping the threshold at 60 is nonsensical:
"I made a case last night to about ten freshman senators, you know, you want to turn this into a unicameral body? What's the point of having a Senate? If the vote margins are the same as in the House, you might as well close the doors," Dodd told reporters in the Capitol.
Ridiculous. Just nonsense. You don't need different vote thresholds to have a bicameral system. Consider:
The 60-vote threshold is not in the Constitution. It just isn't. That was never a requirement for a bicameral legislature.
If anything, the 60-vote threshold has created a unicameral system where the Senate has rendered the House irrelevant. Getting rid of the 60-vote threshold would give the two legislative bodies more equitable power.
Frustrating as argument like Dodd's are, expect a lot more of it over the next five months. Also, expect more articles, such as the one in The Hill last week, where a few Democratic Senators express opposition to lowering the threshold, and thus effort is thus declared DOA.
We are going to have to work to change the narrative on this fight. If, for example, we could get four of five Democratic Senators to favor lowering the cloture threshold even if Republicans controlled the Senate and the White House, then perhaps the narrative would become about when the threshold would be lowered, and not if. Also, if we do a better job focusing on the wider range of proposed rule changes--such as making unanimous consent non-debatable, requiring the filibuster to be a real talkathon where Senators have to stay on the floor (as Senator Lautenberg has proposed), or switching the burden of the cloture threshold on the opposition (for example, 45 votes to continue a filibuster, rather than 60 to break it, as Senator Bennet has proposed)-then the interest and momentum for reform could increase as people debate a wider range of possible reforms.
Senate rules are not going to stay the same forever. The rules have changed in the past, and will change again in the future. The question is not if the rules will change, but rather when and how.
During Netroots Nation, we are running Golden Oldies plus a few surprises. Regularly Scheduled programming will resume on July 26.
A Matt Stoller Golden Oldie
Tue Dec 25, 2007. Original HERE.
Here's Ezra Klein expressing a fairly common sentiment among both Democratic base voters and Democratic elites.
As a result of my post defending Obama this morning, I'm getting a bunch of links along the lines of "Ezra Klein, no fan of Obama..."
This is, to be sure, my failure as a writer, so just to be clear: I'm impressed with all three of the major Democrats, and, for that matters, most of the other Democrats not named "Bill Richardson."
Ezra is happy with the Democratic candidates; most Democratic voters share Ezra's views. I don't (and neither do a few others). The issues we are dealing with today - health care, jobs, even a war in Iraq - are literally the same issues we dealt with in 1992. How can that possibly be considered progress? A real progressive candidate would take an apolitical problem and turn it into a mainstream political subject. None of our candidates have done that. Here are five easily mainstreamable problems ripe for the picking. There are more of these, I'm just picking at five that touch on the national security state, secrecy, economic injustice, and attacks on our civil liberties.
Subject: End the War on Drugs
Factoid: There are 1 million people put in jail for doing what Barack Obama, Bill Clinton, and George Bush have done.
Marijuana is America's largest cash crop, and it is responsible for around 225,000 arrests a year. Overall, the war on drugs incarcerates around 1 million people a year. Direct spending on the war on drugs this year is $50 billion dollars, about $600 a second. Around half of high school seniors have consumed marijuana (pdf). Simply put, why do some people go to jail for marijuana and cocaine, and others run for President?
Subject: End corporate media ownership:
Factoid: General Electric, a major defense contractor and conglomerate, owns NBC, MSNBC, and CNBC.
Our media is owned and controlled by a few major companies. One of them, GE, has major defense contracts, and strong incentives for war. It also has huge interests in the financial industry. Why is this company controlling our news content again, while we are in two wars? And why did the FCC just relax ownership requirements in local areas, again?
Subject: End American empire
Factoid: As of 1998, America had troops stationed in 144 countries around the world.
There are any number of ways to talk about this issue, from disparities of foreign aid to complaints about the IMF to the war in Iraq to the CIA and blowback. The bottom line is that America has troops everywhere in the world, it's expensive, the way it is done now is a bad idea, and we need to bring them home and return to being a republic. That or we need to figure out how to be a responsible international power again and get rid of the Blackwater-style military we are building and the gunrunning vigilante CIA-style Cold War and post-Cold War nonsense.
Subject: End the war economy:
Factoid: Money for Iraq keeps passing in 'emergency' legislation to avoid being subject to budget rules.
For some reason, Blue Dog Democrats and Republicans argue that they are fiscally responsible while ignoring their votes to spend 700-800B a year on war. Libertarian charlatans like energy expert Amory Lovins think that the corporate sector and the military sector are legitimate parts of the state, but that other spending is wasteful. The whole notion of the military not being a part of the overall government is crazy, and reflective of a huge, corrupt, and Soviet-style misallocation of capital through secret budgets and fear.
Subject: End the cradle-to-prison superhighway
Factoid: 2 million people are in prison in America, by far the highest total of any other country in the world.
Think slavery has ended? Think torture is 'new'? Think again. With two million people in prison, and tens of thousands of sexual assaults every year, prison is a huge industry and a horrendous abridgment of the idea that is America.
Touching on any of these massive injustices in our economic infrastructure is something no candidate has systematically done. Only John Edwards has remotely addressed the concept of the war on terror, in a somewhat half-hearted way, and he has made 'poverty' a somewhat commonly repeated theme, though not in any meaningful sense. Clinton and Obama are disgracefully absent on these topics. Ironically, Bill Richardson, aside from his great work on residual forces, has also said that the 'war on drugs is not working', which reflects perhaps a more executive oriented and confident worldview. Chris Dodd has also advocated for marijuana decriminalization, which is a less aggressive but still laudable sentiment, especially in light of his work on core constitutional issues.
So anyway, while the insider wonk community is happy that their issues seem to be taken care of, and Democratic base voters like the different candidates we have, I find that actual progressive reframing of our political system is appearing only at the margins of our secondary candidates like Bill Richardson and Chris Dodd, and among crazy white supremacist types like Mike Huckabee and Ron Paul. Each of the five hinges I've discussed starts with the verb 'end', and that was not planned when I started this post. I think it means that we must end a chapter in American history, and begin a new one.
Restoring healthy communities, healthy citizens, a healthy global order, healthy local media, and a healthy sustainable economy are the key drivers of where need to go as a country. The cancerous symptoms are all around us, and leading Democratic Presidential candidates are too corrupt and morally crippled to even begin talking about them. But we'll get there.
Update--Cloture vote will fail: Cloture is about to fail. Collins and Snowe voted for cloture, while Feingold and Cantwell voted against it. Specter and Begich did not vote. So, even when Specter and Begich come back, Dems will need to find one more vote. Hopefully, that will be accomplished by getting Cantwell a vote on her amendment to reinstate Glass-Steagal.
***
Wall Street reform legislation continues to unfold in the Senate, with several dramatic developments over the past 24 hours. Here are where things stand at 2:55 pm:
1. Cloture vote delayed The cloture vote on the overall bill had originally been set for 2:00 p.m. today, but is now delayed indefinitely. Senate Democrats are caucusing to figure out what to do next.
2. Susan Collins and Ben Nelson on board, but progressives blocking passage Republican Susan Collins, and uber-ConservaDem Ben Nelson came out in favor of cloture today.
If all other Democrats held together, this would mean there are enough votes for cloture to succeed. However, many progressives--Cantwell (reinstating Glass--Steagal), Dorgan (ending naked credit default swaps), Harkin (capping ATM fees at $0.50), Merkley (reinstating Volcker rule), Levin (same as Merkley) and others--remain angry that their strengthening amendments have not received votes, and as such are not promising to support cloture. In fact, Cantwell just said she does not support cloture, as of right now.
Progressive anger over this turned into chaos--or as close as the Senate ever gets to chaos--on the floor last night. Tom Harkin openly angry at Harry Reid, Senators huddled every which way to strategize, strange procedural moves were employed (see bullet point below for the prime example), and more. Ryan Grim and David Dayen have good rundowns of the events.
3. Big strengthening amendment attacked to big weakening amendment Jeff Merkley and Carl Levin are two of the progressive Senators pissed that their amendment (to reinstate the Volcker rule) did not receive votes. Republicans had been objecting to holding a vote on the Merkley-Levin amendment (unanimous consent is required for amendment votes), and the amendment was also not deemed germane by the parliamentarian for a post-cloture amendment vote. Basically, there was no way to get a vote on their amendment.
So, to "solve" this problem, Merkley and Levin attached their amendment to a horrendous weakening amendment, filed by Republicans, which has been deemed germane for a post-cloture amendment vote. That amendment, filed by Sam Brownback, exempts auto dealers from new consumer protection laws, even though auto loans are the biggest instances of financial malfeasance against consumers, especially military personnel.
Now, to prevent a vote on Merkley-Levin, Republicans would have to also block a vote on the Brownback amendment. From a statement by Senator Merkley:
The Merkley-Levin amendment must now be voted on before the entire Wall Street reform bill receives a final vote. For the Merkley-Levin amendment to ultimately be included in the final Wall Street reform bill, the Merkley-Levin amendment must pass and then the Brownback amendment to which it is attached must pass.
The Merkley-Levin amendment will ban high-risk trading inside our lending and depository institutions to help prevent a future financial crisis and prevent bank capital from being diverted away from loans into trading. The amendment will also end conflicts of interest in cases such as Goldman Sachs and will send a strong message to Wall Street that betting against the best interests of their clients will no longer be allowed.
This leaves a bad taste in my mouth, but it isn't actually a bad bit of gaming from Merkley and Levin. The best way to approach this is to try and get the votes for Merkley-Levin, and simultaneously work to the Brownback amendment anyway. It is still preferable that the Brownback amendment is defeated, thus defeating both amendments, but at least this way there is no way for the Brownback amendment to pass without a big strengthening amendment simultaneously passing (at a 51-vote threshold, Merkley-Levin should be a sure thing). We can't get the best of both worls-passing Merkley-Levin and defeating Brownback, but at least we won't get the worst of both worlds now.
4. Arkansas Senate primary saves derivatives reform (for now) And here is the most dramatic development of all.
Last night, Chris Dodd (who is managing the Wall Street reform bill), introduced an amendment to gut the derivatives regulation that is at the heart of the bill. The original derivatives language had been written by Agriculture Chair Blanche Lincoln. It was pretty strong, as it required the biggest banks to sell off their derivatives departments. Dodd's proposal would delay implementation of Lincoln's language by two years, and probably forever, by requiring a series of studies led by people opposed to those portions of the bill (such as leading Obama administration figures).
Dodd had planned this course of action all along, but had waited on doing so to prevent embarrassing Blanche Lincoln, who faced a left-wing primary challenge from Bill Halter. If Democrats were to strip Lincoln's populist legislation from Wall Street reform, it would cause her real trouble, as Halter is challenging her from a populist and progressive angle. Lincoln can't afford to look ineffective, like a suck-up to Wall Street, or like someone who only wrote the legislation to get elected.
However, now that Bill Halter not only forced Lincoln into a June 8th runoff, but only polled 2% behind her overall, Lincoln is still in real danger of being defeated in the primary. As such, Dodd withdrew his proposal to gut derivatives regulations.
This is a remarkable example of both good timing, and bow primary campaigns are an effective means of changing Democratic behavior in Congress. Without the progressive pressure on Lincoln specifically, and on Senate Democrats more generally, the derivatives portion of the bill would already be gutted.
****
More developments as they come in. Everything is up in the air right now.
It is heartening to see Democrats at least attempting this approach. However, it would work a lot better with a less compromised bill, and without the Democratic leadership actually caving to Republican demands.
The Obama administration is urging Senate Democrats to drop a $50 billion bank liquidation fund from a financial regulation bill. The money has become a target of Republicans, who have branded the fund a Wall Street bailout.(...)
The administration instead wants the costs of liquidation to be paid by the financial industry after a firm has failed and been dismantled.
Just giving into the main demand from your opposition is antithetical to the politics of contrast.
Further, neither putting the fund into the bill, nor removing it from the bill, won any Republican support. Susan Collins, who had been the last Republican to line up in opposition to the bill, is still opposed after the fund was removed.
"What last week showed me is that we have two options as this debate moves forward: either we let the people who know this legislation best get back to the negotiating table and work out a solution that's acceptable to both parties and to the American people ... or, I can come down to the floor, identify some of the other flaws in this bill ... watch as people come down to scream and yell about my suggestions and my motives ... and then wait for the White House to agree with me at the end of the week."
McConnell is probably right. Republicans made a demand to put a liquidation fund into the bill, and Senator Dodd complied. Then, Republicans made a demand to remove it from the bill, and White House complied. What reason is there to think that whichever Democrat is in charge at whatever point in the process won't just continue complying?
If you want to play a political game of clarity and contrast, then you need to act in an uncompressing way. In this vein, asymmetrically wiping away Republican ideas in the bill every time Republicans demand concessions is likely a better move than appearing to cave. Also, maybe President Obama should holding a rally in Maine in response to Susan Collins declaring her opposition to the bill.
Those sort of aggressive moves may be unfamiliar territory for the Obama administration when it comes to dealing with Republicans, but if they want to push a narrative of contrast on the financial reform bill, that is the mode in which they need to operate. You can't play the politics of contrast when you are regularly giving into the other side's demands.
The most unnerving part of the debate on financial reform is wondering which of the retiring Senators spending time on crafting the legislation are thinking about, or even actively discussing, going to work for one of the Wall Street mega-banks.
One of the great myths in American political theory is that once a politician gets ready to retire, or can't run again because of term limits or other reasons, it makes him or her likely to be a "statesman" because he or she doesn't have to worry about the voters anymore. The presumption that actual voters are unhelpful to getting good legislation passed is profoundly undemocratic because once voters don't matter anymore, other things begin to matter too much: where you will work next, how much you will get paid, what your close friends (many of whom have raised all that money for you over the years) think, what the DC establishment that you will be hanging out with at cocktail parties in your retirement think. Things like that may start to matter a lot more to some retiring Senators than being able to defend the deals you are cutting to voters.
It's not like the kind of thing I'm talking about has never happened. The most obvious case is Billy Tauzin working on the prescription drug bill that was such a sweet deal for Pharma, and then going to work for them as a seven-figure salaried president after he retired. But there are many, many other cases of Congresspeople and Senators working on legislation affecting an industry the year they retire, then getting a great consulting gig with the industry trade association soon thereafter.
The financial reform bill is way too important to let this happen. All of the Senators and House members working on this bill should pledge right now that they will not go to work after they retire for Goldman Sachs, Citibank, JP Morgan Chase, any other of the other mega-banks, the American Bankers Association, or any of the other big industry players on this legislation. There are too many rumors swirling around on Capitol Hill right now of major players in this fight who are retiring this year starting to feel out industry players for jobs in 2011. The White House, Speaker Pelosi, and Senator Reid should demand that all the Senators working on this bill take such a pledge to not sell out the American public.
The Dodd bill needs to be strengthened. Democrats need to draw a line in the sand and fight for a bill that really does something to take on the big banks. If the Republicans want to defend Wall Street by filibustering such a bill, God bless them, I'd be delighted to have that fight. But to get the best possible bill, we need the Senators negotiating it to not be preparing to work for the industry.
Now that health care reform has finally been enacted, a host of critical economic issues are taking center stage, including financial reform, unemployment and deeply rooted economic inequality. But it's important to note that with its health care vote, the U.S. House of Representatives actually approved a very important, and often overlooked financial reform: Student lending.
Pedro de la Torre III of Campus Progress explains the current student loan nightmare in an interview with The American Prospect's Rebecca Delaney. For years, the U.S. government has paid massive subsidies to some of the worst-run companies in the country.
Thanks a lot, Sallie Mae
As de la Torre notes, instead of directly making loans to students, the government spent years funneling money to firms like Sallie Mae to actually make the loans. When things went sour, taxpayers covered the lender's losses from student loans that ultimately went bad.
Taxpayers were also footing the bill for the loans and taking on the risk, while private companies and their executives enjoyed the benefits. The executives made quite a haul. In 2008 alone, Sallie Mae CEO Albert Lord took home an astonishing $46 million. Even among CEOs, that's a princely sum-more than double what Halliburton CEO David Lesar made the same year. All of that money could have financed a lot of college educations.
Fortunately, the student loan landscape is almost certain to change as a result of the health care vote. The House bill included a provision to end student loan subsidies and boost funding for direct grants from the government to students.
Since the student loan reform and health care were both eligible for reconciliation in the Senate (meaning only 51 votes are needed for passage instead of the 60 to clear a filibuster), House Democrats decided to move on both at the same time. It's a significant reform, and one that will soon become law with President Barack Obama's signature.
What would an overhaul of the consumer finance industry entail?
The student loan system is just one aspect of the consumer finance industry that needs a major overhaul. On mortgages, credit cards, overdrafts, and payday loans, the banking status quo is one of outright predation. As Heather McGhee of Demos explains to The Nation's Christopher Hayes, there's a reason why federal agencies do a lousy job regulating consumer banking abuses.
Right now there is no agency responsible for consumer protection alone. Every regulator also focuses on making sure banks don't fail, which generally means that regulators support anything that increases short-term profits. Egregiously predatory practices generally lead to big short-term gains in banking.
A new consumer financial protection bureau
Last week, Senate Banking Committee Chairman Chris Dodd (D-CT) introduced a bill that would create a new bureau of consumer financial protection, with no constraints from bank profitability. It's a step in the right direction, but as McGhee notes, there are plenty of problems with Dodd's proposal. Most problematically, the bill gives existing agencies a veto power over any new consumer protection rules. That's a terrible loophole. Existing regulators have actively opposed consumer protections in the past, and there is every reason to expect that practice to continue.
Rapid tax refunds scam the poor
It's late March, which means tax season is getting into full swing. All over the country, mascots from Liberty Tax are spilling into the streets wearing goofy costumes, trying to win your business. But millions of Americans don't realize that Liberty, along with H&R Block, Jackson-Hewitt and hundreds of smaller businesses are engaged in a monstrous scam disguised as a complicated accounting service.
As Alexander Zaitchik emphasizes for AlterNet, these tax preparers have used deceptive advertising and slick salesmanship to con people into taking out "refund anticipation loans," also known as "rapid refunds" and a handful of other pleasant euphemisms. It's a simple gimmick: H&R Block does your taxes, and then presents you with your tax refund, right away, no waiting. But the check you receive is not actually your tax refund-it's your tax refund minus a truckload of fees that you didn't realize were being deducted. This is the tax-time equivalent of payday lending.
When the government sends in your actual, larger tax refund one-to-two weeks later, you won't see it-it goes straight to H&R Block's bank partner. Those banks are making big money taking from your tax returns. Here's Zaitchik:
"In 2008, more than eight million Americans spent nearly a billion dollars paying interest and fees on RALs-often based on misleading or incomplete information-swelling the profits of tax preparers and their partner banks."
The one break low-income people get under the U.S. tax code is the Earned Income Tax Credit (EITC), the nation's largest anti-poverty program. Only about 16% of taxpayers qualify for the EITC, but as Zaitchik notes, nearly two-thirds of the people who take out refund anticipation loans receive the credit. Tax preparers are making a concerted effort to prey on the poor, making the EITC program more expensive and less efficient for all taxpayers-not just those who go to H&R Block or Liberty Tax.
More action needed on jobs
Beyond finance, the U.S. economy has a serious jobs problem. Last week, Congress approved an $18 billion jobs package that is simply far too small to make a serious dent in the nearly double-digit unemployment rate. As Art Levine explains for Working In These Times, the package will create 250,000 jobs at best. That number shouldn't be acceptable to anyone watching the U.S. economy, which has shed about 7 million jobs since the recession began.
There are much stronger options available than the $18 million bill the Senate approved. Rep. George Miller (D-CA) has introduced a bill in the House that would quickly save or create one million jobs, and the House has already passed a separate $154 billion jobs package that would prevent 900,000 lay-offs. If the Senate moved on either one, the result would be a major economic boost.
The link between poor economies and poor health
All of these problems-unemployment, student loan scamming, refund anticipation loan sharking and other forms of financial predation-reinforce economic inequality in the United States, which is at levels unseen since before the Great Depression. That inequality is ultimately actively damaging to public health, as epidemiologist Richard Wilkinson explains in an interview with Brooke Jarvis for Yes! Magazine. Rampant economic inequality in the United States is literally making us sick.
"We looked at life expectancy, mental illness, teen birthrates, violence, the percent of populations in prison, and drug use," Wilkinson says. "They were all not just a little bit worse, but much worse, in more unequal countries."
With health care finally finished, Congress and the administration have an opportunity to make serious headway on the economy. They've got plenty of work to do.
This post features links to the best independent, progressive reporting about the economy by members of The Media Consortium. It is free to reprint. Visit the Audit for a complete list of articles on economic issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Mulch, The Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
The Senate Banking Committee just passed Chris Dodd's financial reform bill 13-10, in an entirely party-line vote. The vote happened about 20 minutes after the mark-up began.
Pretty remarkable. Republicans have typically used a strategy of hundreds of weakening amendments to delay bills as long as possible at every stage of the process, including every committee hearing. In so doing, they have succeeded in getting hundreds of amendments adopted to these bills, and even in delaying bills by weeks or months (cough, Baucus, cough).
But not today. The bill just sailed through untouched. Bizarre. If only every committee mark-up were this easy.
Just when the Democrats need to be tougher than ever on financial reform, Senate Banking Committee Chair Sen. Chris Dodd (D-CT), seems to have given up completely and put the proposed Consumer Financial Protection Agency (CFPA) at risk.
Last fall, Dodd called the Federal Reserve's regulatory efforts an "abysmal failure." And yet, on March 1, he proposed housing a consumer protection agency within the Fed instead of establishing the CFPA as its own independent entity. This drastic change in strategy has left many Democrats shaking their heads. WTF, Senator Dodd?
"Dodd appears to have switched his focus from out-reforming the White House to out-compromising just about everyone. As the Senate banking committee prepares to release a draft of a comprehensive reform bill as early as this week, Dodd has repeatedly conceded to his Republican counterparts on key issues, almost guaranteeing that the Senate's measure will be far more lenient on the banking industry than the legislation the House passed in December... Dodd's willingness to appease Republicans like Sen. Bob Corker (R-Tenn.), the main GOP negotiating partner, and Sen. Richard Shelby (R-Ala.), the banking committee's ranking member, has disappointed Dodd's fellow Democrats and reform advocates who urge a tougher crackdown."
Whither the CFPA?
Dodd's latest GOP compromise is part of a bigger problem: The Democrats have mishandled financial reform. As Nomi Prins writes for AlterNet, "Dodd's latest effort at creating a new Consumer Financial Protection Agency would render the regulator utterly powerless, but it's not the only issue Democrats appear willing to sacrifice to Wall Street campaign contributions. Right now, just about every other major element of the so-called Wall Street overhaul seems headed for disaster."
Although the establishment of the CFPA has been fiercely opposed by the banks and Republicans, it has widespread approval among progressives and the general public. So why has Dodd apparently abandoned it through compromise? Maybe because he's following the lead of his fellow Democrats. Prins notes: "Since June, we've been waiting to see whether Democrats had the spine to make sure the final agency would actually do something, or quietly gut reform with a barrage of loopholes."
There's still time for Dodd to push real reform before he retires. Or, like Prin says, he could "continue to wimp out for Wall Street, pull a Robert Rubin and secure a cushy job in banking come 2011. The next few months will indicate whether Dodd cares more about his legacy than his wallet."
Solis a 'bright spot'
But maybe there is hope. Department of Labor Secretary Hilda Solis has made considerable progress, as Mark Engler emphasizes for Yes! magazine. Engler calls Obama's Labor appointment a "bright spot" in the administration's first year-a move "that illustrate[s] the difference that a progressive-minded administration can make when it stands up to corporate interests and is unafraid to act in the public good."
Engler writes:
"Under the Bush administration's Department of Labor, the crisis of wage theft was summarily ignored. In March 2009, the Government Accountability Office issued a report saying that the department's Wage and Hour Division had for years 'left thousands of actual victims of wage theft who sought federal government assistance with nowhere to turn.' Secretary Solis made reversing this trend a defining initiative of her department. Even before the report had been released, she had commenced the hiring of 150 new field investigators to enforce wage and child labor laws, as well as 100 more to police government contractors working on stimulus programs."
As Engler argues, officials would do well to follow the lead of Secretary Solis and demonstrate "what can be accomplished when regulators are encouraged to actually do their jobs-to fight for the interests of workers, for example-vigorously and creatively."
Buffet on banking
Finally, GRITtv's Laura Flanders reviews Warren Buffet's annual letter to shareholders, in which Buffet warns his clients that their financial advisers' advice is skewed by the financial system. As Flanders notes:
"Ironically, just as Buffett's letter was being published, the man it'll take to make any agency happen -- Christopher Dodd -- is agreeing to defang the agency, strip it of independence and most prosecution power." Watch the video below.
This post features links to the best independent, progressive reporting about the economy by members of The Media Consortium. It is free to reprint. Visit the Audit for a complete list of articles on economic issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Mulch, The Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
On the first day in is in session in 2011, the Senate will be able to change its rules with a simple majority vote (51). As such, we have been tracking support in the Democratic caucus for reforming the filibuster.
To date, 11 members of the Democratic Senate caucus--all of whom are 99%+ certain to return in 2011--support a majority-controlled Senate requiring only 51 votes to pass legislation. Further, 9 other members of the caucus support some other, often unspecified, type of reform to the filibuster rule. That is already 20 in favor of some type of reform.
Evan Bayh and Chris Dodd, two Senators who won't be in the Senate for the crucial vote next year, have also come out with their positions. Since they are leaving the Senate this is purely academic, but it still demonstrates an interesting lesson: filibuster reform is not supported only by progressives. In this case, the famously centrist Evan Bayh favors filibuster reform, while the more progressive Dodd opposes any change.
I think it's something we need to do, perhaps looking at changing the threshold once again, down to 55. Perhaps saying that, Administration appointees, other than the very highest ones, should not be subject to the filibuster. Because it's just brought the process to a halt, and the public is suffering. So the minority needs to have a right. I think that's important. But the public has a right to see its business done. And not routinely allow a small minority to keep us from addressing the great issues that face this country. I think the filibuster absolutely needs to be changed.
The campaign for filibuster reform is proving to be less dominated by progressive Senators than the original campaign for the public option:
21 current and future Senators have now come out in favor of some sort of reform. Seven of those 21, or 33%, are either members of Evan Bayh's "Moderate Working Group" (Conservadems) or of the Senate New Democratic caucus. That is roughly the same percentage of Conservadems and New Dems in the overall Senate Democratic caucus (22 of 59, or 37%).
By comparison, among the original 28 supporters of the public option in the Senate, only three were either Conservadems or New Dems. That is only an 11% representation for those two groups, far below their overall percentage of the Senate caucus.
Filibuster reform has diverse ideological support within the Democratic Party. Don't assume that just because a Senator is on the right-wing of the party that s/he will be opposed to this campaign.
One of the toughest decisions to make in politics is figuring out the right time to compromise and the right time to pick a fight and see the fight through. As that great verse from Ecclesiastes says so well, there is a time for every season under heaven. Being willing to make modest compromises has resulted in some of the greatest legislation in American history, but it has also been a fiasco at times. Knowing the right time to pick a fight (think Bill Clinton during the 1995 government shutdown fight with Gingrich) can be absolutely transformative for a politician.
The whole legacy thing sometimes clouds the judgment of even the best politicians on when to compromise and when to stand tall. My all-time favorite Senator, the best and most effective in history in my opinion, was Teddy Kennedy, but toward the end of his career he got snookered by the Republicans twice, in part because I think he was thinking a little too much about his legacy: on No Child Left Behind, where Bush promised him a lot for money for education and then broke his promise after the bill was passed; and on the Medicare drug bill a couple of years later, where the decent compromise he forged in the Senate got rolled in the Republican controlled conference committee, and they passed a bill that was a pure giveaway to the pharmaceutical industry.
Unfortunately, another fine Senator, Chris Dodd, is letting the legacy thing cloud his judgment. Dodd is complaining about President Obama's strong new push for a more progressive financial reform policy. Yesterday, in a committee hearing, Dodd said that the new proposals are "adding to the problems of trying to get a bill done...I don't want to be in a position where we end up doing nothing because we tried to do too much at a critical time." Dodd has been working closely with Republicans on the Finance Committee in the hopes of getting a compromise that can get 60 votes, and all of a sudden the White House is upsetting the applecart by pushing for more. Dodd knows that he needs Republican support to pass a bill in the Senate, and that to get Republican support he has to have a bill acceptable to the big banks. With him retiring, he wants one final legislative feather in his cap, so if he needs to cut a deal with the big banks, he'll do it.
Now I admire Chris Dodd a great deal. He has spent a career on the frontlines fighting for poor kids and families, and against stupid wars. But on this issue he is dead wrong. His legacy is just fine without adding a watered down and ultimately ineffectual financial reform bill to his list of legislative accomplishments. What is needed now, both for Democratic political prospects in general and to make the policy effective in reining in the power and excesses of Wall Street, is to pick the fight with the Republicans and bank lobbyists. As President Bush might have said, bring it on.
There are two dimensions to this, one on the policy side and one on the political. It is a simple fact that the longer this issue stews, and the more high-profile pressure is placed on the big bank lobbyists, the better the policy we are going to get in terms of doing things that really matter in terms of financial reform. If you tell the Republicans on the committee that we are only going to do this in a bipartisan way and we want to make you comfortable with signing off on the legislation, it puts them in the catbird seat, and the legislative language we get becomes gruel real fast. If on the other hand we raise the stakes, say (like the President in the State of the Union) that we're only going to do financial reform if we can do it right, and really start banging the Republicans for doing Wall Street's bidding, I think that after a few weeks on the grill will make at least a couple of them far more likely to agree to something real. Once it gets to the floor: if the Republicans threaten filibuster, tell them to go ahead and make our day. Bring the bill up, debate really popular amendments, and let them keep blocking a vote on the issue. I suspect that it wouldn't take very long for the Republicans to decide that we ought to let this bill pass rather than face week after week of getting public heat for being the big bankers' best buddies.
On the politics of this, Democrats have nothing but upside in picking a fight and letting it cook for a while. Every day that Democrats are seen as trying to pass the strongest possible bill to hold the banks accountable, and every day that Republicans are seen as helping Wall Street block it, is a good day for the Democrats in terms of the 2010 elections. Democrats have the political high ground here, and they damn well ought to use it to get a better bill.
Senator Dodd, I love ya like a brother. You already have a great legacy. Don't tarnish that legacy by having the final act of your long and distinguished Senatorial career being giving the big banks and their Republican allies everything they want in order to get easy passage of a watered down bank bill, hurting both the economy and your party in the process. It's time to pick a fight.
Update: Check out this article from WSJ that talks about how Republicans are running to Wall Street donors, telling them it's the Republicans who will save them from any financial reform legislation that would actually do anything to them. All the more reason to raise the stakes on this fight and go for it. Wall Street is going into high whine mode about mean old Democrats attacking them. Good. Now let's go the mat, and win the fight both on policy and politically.
I was planning to write a piece on banking issues today, but with three surprise retirements of Democratic incumbents in statewide positions yesterday (Dorgan and Dodd in the Senate, Gov. Ritter in Colorado) I have to comment on that situation. Fortunately, the two things are pretty closely linked.
Look, I have no doubt that personal considerations entered into all three of these decisions, and we don't want to overdraw our conclusions here. Byron Dorgan and Chris Dodd have both been in the Senate a very long time, and are both getting to the age where retirement is an understandable option. There are all kinds of rumors about Ritter's more surprising news, but again there are likely very personal reasons for him wanting to not run for re-election.
Having said all that, though, there is very little doubt that a tough-looking 2010 for Democrats weighed into the decision-making here. Base enthusiasm is lagging, Obama's approval rating is sinking, unemployment isn't going down: political professionals are looking at all these factors and getting very nervous. Anyone who was considering retiring already has to be thinking that the 2010 election trends make the decision to get out while the getting is good a pretty smart one.
I'm not going to sugarcoat anything here: anytime you have a bunch of incumbents retiring, it's not a good sign for what people think of the party's chances in the fall. However, there is one really important silver lining: in a year when voters are in this foul a mood, non-incumbents and anti-establishment candidates have some significant advantages over incumbents. In 2006 and 2008, in many of the big primary races the anti-establishment insurgent won, including that 2008 Presidential race you might remember.
Which brings me to the banking issue. The biggest single mistake President Obama has made politically and economically was the one he made in the very earliest days of the transition, which was to signal he wasn't going to take on the big banks aggressively. Swing voters, Democratic base voters, and Democratic activists are all united on one key point: they hate the big banks on Wall Street, and are angry that politicians are not being far tougher on them. In order to survive and win elections in 2010, Democrats are going to have to separate themselves from Bob Rubin-style economic policies and be far more aggressive and populist in their campaigns. Doing that as a non-incumbent will be easier in many cases than trying to do it as an incumbent.
The movement against the banks is building and growing. On May 6th of last year, I wrote a piece about what would need to happen to take on the power of the big banks. I listed six ideas, the first of which- creating a new coalition to take on financial reform issues- happened in the weeks after my article with the formation of Americans for Financial Reform. The middle four ideas are all being worked on to one degree or another- progressives coming up with an economic Plan B to the one we care on now, working to get public financing of campaigns passed, encouraging investigative journalism in the banking arena, progressives forming more alliances with independent community bankers. The sixth idea, starting a nationwide movement to switch over money from the big banks and credit unions, got a huge burst of momentum with the launch of the Move Your Money campaign. Inspired by a dinner one night with Arianna Huffington and a group of top flight political and media strategists (and, no doubt, by the one line in my seven-month-old post- I'm sure everyone there has great memories about my blog posts), a new campaign was launched to encourage people to move their money from the too-big-to-fail banks which wrecked our economy into smaller independent community banks. Read about it here, and join the action.
Bailing out and coddling the big banks is the number one reason that swing voters, Democratic base votes, and Democratic activists have gotten angry at the establishment and less inclined to support Obama. If Democratic candidates on the ballot this year take up the anti-big bank banner, they will reap big benefits, because the anti-Wall Street movement is gaining momentum. And if the rest of us start challenging Wall Street's power in other ways, we might really begin to change America in a serious way.
Two Democratic senators unexpectedly announced their resignations on Tuesday. Sens. Byron Dorgan (D-ND) and Chris Dodd (D-CT) announced that they would not seek reelection when their terms expire in 2010. Hopefully, health care reform will already have passed by then, but the departure of these senators will have implications for health care policy.
As far as the Democratic majority in the Senate is concerned, the two resignations probably cancel each other out. As a relatively conservative 30-year incumbent, Dorgan was thought to be the only Democrat who could win a seat in conservative North Dakota. Dodd, on the other hand, is deeply unpopular for his role in the financial crisis, but hails from a deep blue state, so it should be easy to replace him with another Democrat. In fact, as Eric Kleefeld reports for Talking Points Memo, Dodd's resignation improves the Democrats' chances of holding that seat.
As Jodi Jacobson explains in RH Reality Check, losing Dorgan would be a setback for reproductive rights. While Dorgan has a mixed record on choice, "Given his state, Dorgan's voting record is pretty progressive on at least some issues otherwise driven completely by ideology," Jacobson writes.
Dodd is reliably pro-choice, but the pro-choice credentials of the candidate favored to take his place, Connecticut Attorney General Richard Blumenthal, are even more distinguished.
Last year, Blumenthal sued the Bush administration over so-called "conscience clauses" for the Department of Health and Human Services which would have given employees more latitude to refuse to provide medical care that they disapproved of on religious grounds. (The Obama administration later reversed the rule.) In 1995, Blumenthal and the U.S. Department of Justice filed suit against two anti-abortion protesters under the Freedom of Access to Clinic Entrances (FACE) Act. "Our goal was to defuse a volatile situation before it escalated into a bloodbath, such as the fatal shootings in Brookline, Massachusetts," Blumenthal explained at the time. Blumenthal and DOJ prevailed in court in 1997.
In other health care news, an unnamed Senate aide told the Wall Street Journal's Washington Wire blog that the Democrats are planning to streamline the passage of the health care reform bill by skipping the conference committee. Normally, the House and Senate versions of a bill are combined in conference. This time, Democrats may skip that step by hammering out a deal that is acceptable to the Senate, having the House pass that bill, and then having the Senate pass the same legislation. That way, Democrats can circumvent some procedural hurdles in the Senate.
According to Kevin Drum of Mother Jones, skipping conference has become routine for big Democratic bills. These days, thanks to stricter rules about what can be added in conference, the House and the Senate are more likely to reconcile big bills through the aforementioned "ping pong" process.
John Nichols of The Nation argues that skipping conference will leave progressives out in the cold. Until now, a lot of progressive energy has been focused on strengthening certain provisions of the Senate bill in conference. If the Democrats decide to skip conference, that means that all the power will be in the hands of Senate Majority Leader Harry Reid (D-NV), Speaker Nancy Pelosi (D-CA) and a handful of their closest allies.
Finally, Monica Potts of TAPPED discusses a new study that purports to show that the so-called "g-spot" doesn't exist. Headlines are proclaiming that the g-spot is a myth. The results of the study have been misinterpreted in the general rush to proclaim that science has proven women wrong about their bodies. What the study really showed is that genes have little to do with whether a woman thinks she has one.
These results suggest that the g-spot isn't a unique organ encoded in our genetic plan, like a spleen or a kidney, but that there's no doubt that the front wall of the vagina exists, nor that some women report orgasms from stimulating that area. What other anatomical questions are investigated with surveys? Do you have a pancreas? Chances are you've never directly observed your pancreas. Whether you say "yes" depends whether you've read that humans have them.
Whether women agreed that they had g-spots had more to do with their age. Younger women, raised in an era where women's magazines assert that g-spots are a standard part of female anatomy, were more likely to believe they had them. What this study was really measuring was a general belief in the existence of g-spots, which has no genetic component. Belief in the pancreas has no genetic component either, but it doesn't follow that these organs are mythical.
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Blumenthal leads Rob Simmons 59-28, Linda McMahon 60-28, and Peter Schiff 63-23.(...)
Blumenthal's numbers in this survey are quite a stark contrast to Dodd's.... [Dodd] trailed Simmons for the 11th consecutive time in a publicly released poll, 44-40, and also found himself locked in a tie with McMahon at 43.
Democrats score a 32% boost in Connecticut Senate polling in one-day, and it is called "a blow" to their Senate election chances.
It's not like the PPP poll, or Blumenthal's entry into the campaign, were secrets. The same article in The Hill noted that Blumenthal will run. Further, PPP had tweeted about Blumenthal's dominant polling position 12 hours before The Hill published its article. Yet further, anyone writing about Connecticut politics should have already known that Dodd was in serious, perhaps insurmountable re-election trouble, while Blumenthal is by far the most popular politician in the state.
As I've said, the media still continue to take their cues from whatever the latest Republican talking point of the day is. Old habits die hard, or perhaps not at all.
Dodd's retirement is the best news Democrats have received in any Senate campaign in months. Any other characterization runs afoul of all existing empirical evidence.
Of course, be wary when the first set of blind quotes you read from party strategists after a retirement is "[Fill in the blank's] decision may turn out to be a blessing." As we wrote above, that's probably true regarding Dodd.
And then, at the end of the same paragraph:
The fact is that retirements, party switches, etc. hurt a party -- period.
Yeah, retirements always hurt a party. PERIOD!!!!! Except that, at the start of this same paragraph, the author wrote that Dodd's retirement helped Dems. Awesome.
Update 3--The Hill changes the article: The Hill has edited the article and no longer claims Dodd's retirement is bad for Democratic electoral chances.
The net effect of Byron Dorgan's and Chris Dodd's retirements on the Senate picture is that Democrats will now lose North Dakota instead of Connecticut.
Losing North Dakota In North Dakota, Senator Byron Dorgan's retirement is a real blow. North Dakota is a pretty red state (Cook PVI R+10), the national environment is pretty favorable to Republicans right now, and Republican Governor Jim Hoeven--who is likely to run--is a very popular figure.
This is made worse given that Byron Dorgan is about the most progressive figure we could have hoped for in North Dakota. While Ed Schultz is a clear exception, even he probably can't beat Hoeven this year. Schultz is unlikely to run, anyway.
All of this makes it extremely difficult--almost impossible, really--to hold the seat this year. A right-winger is now very likely to replace a pretty good Senator in Byron Dorgan.
Gaining Connecticut Chris Dodd was all but toast in Connecticut. He trailed well known Republican Bob Simmons by 10%, and also trailed little-known Linda McMahon. It is not impossible that Dodd could have held the seat, especially if, as was seemingly likely, Linda McMahon won the primary. However, his retirement improves Democratic odds to hold the seat dramatically.
Attorney General Richard Blumenthal is now the likely Democratic nominee in Connecticut. Blumenthal will announce that he is running at 2:30 p.m., a couple hours after Dodd officially announces his retirement. In the mid-November Quinnipiac poll of Connecticut, Blumenthal sported a gaudy 78%-13% approval disapproval rating. Public Policy Polling, which just completed a Connecticut poll that included numbers on Blumenthal versus Simmons and McMahon, writes "Democrats will keep the Senate seat in Connecticut now."
In the same way that defeating Hoeven is virtually impossible in North Dakota, defeating Blumenthal is virtually impossible in Connecticut.
*****
For the Senate, the net result is that Democrats will now lose North Dakota instead of Connecticut. It is not a disastrous trade, though not a great one, either. A loss in Connecticut would have been easier to reverse in 2016 than a loss in North Dakota. Further, as I already mentioned, Byron Dorgan is pretty progressive for a red state like North Dakota. Short of Ed Schultz becoming a Senator, it will be difficult to get a progressive in that seat anytime soon.
Perhaps worst of all, Blumenthal was a lock to defeat Joe Lieberman in 2012. Back in Februrary, Blumethal led Holy Joe 58%-30% in a hypothetical 2012 matchup. Now, Democrats are going to have to find someone else to dump Lieberman in 2012. Whoever else they find will simply not have as good a chance as Blumenthal.
On net, the Senate forecast remains the same. Democrats are expected to lose five seats in November, resulting in a 55-45 Senate. The Governor's races will be looked at in another post.
Blumenthal leads Rob Simmons 59-28, Linda McMahon 60-28, and Peter Schiff 63-23. It would take an epic collapse for him not to be Connecticut's next Senator.
Barring something truly shocking, Richard Blumenthal will be the next Senator from Connecticut. Now, we just need someone to dump Lieberman in 2012.
As Schultz pointed out on his show last night, North Dakota requires that candidates maintain residency in the state for five years prior to running for the Senate, and he has lived in Minnesota for the past two years -- meaning he is not eligible for the position.
So, this really does appear to be a Connecticut for North Dakota swap.
Update 3--Schultz is eligible: It appears that states cannot actually set requirements about who runs for US Senate--only the Constitution can. This means that Schultz is eligible to run for Senate.
On the off-chance that Hoeven does not run, and Schultz does, it would be pretty awesome for Dems and Progs alike.
STATE BLOGS
