2009 - %3, November

The Anti-Chamber

| Thu Nov. 5, 2009 5:10 PM EST

The Chamber of Commerce may be taking an ever-so-slightly less obstructionist approach to climate issues lately. But now it has some new competition in the lobbying realm: American Businesses for Clean Energy, a coalition that has formed to push for climate legislation.

The group, which debuted on Wednesday, has 23 members, ranging from retailers like The Gap to major utility PNM Resources of New Mexico, one of the companies that quit the Chamber over its climate stance.

"There's a real hunger on behalf of businesses to have their voices heard, and for Congress to realize they are really clamoring for legislation," says Jenn Kramer, a spokesperson for New Jersey utility PSEG, another member of the new coalition. "Absent a price on carbon there's a real paralysis in the energy industry in terms of making investment decisions."

The group isn't pushing for specific targets, timetables, or funding for various energy sources. Their stated goal is simply to encourage Congress to enact "clean energy and climate legislation that will significantly reduce greenhouse gas emissions."

The new coalition isn't the only pro-climate business group out there. The U.S. Climate Action Partnership, launched in January 2007, is a business-environmental coalition that includes 26 major companies, and crafted a blueprint for climate legislation in January that became the framework for both the House and Senate bills. Two USCAP members—FPL, a Florida utility, and PNM—are also part of the new coalition.

And in March, the sustainable business group Ceres launched Business for Innovative Climate and Energy Policy (or BICEP, for short) to advocate for climate legislation. That group is more oriented to companies that provide consumer products, like Levi Strauss & Co., Nike, and Starbucks.

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The Day John Boehner (and the GOP) Went Nuts

| Thu Nov. 5, 2009 3:53 PM EST

At today's small Tea Party rally on Capitol Hill, as a few thousand right wing activists railed against the emerging health care reform legislation, Republican House minority leader John Boehner came before the angry crowd (and its signs declaring the president a "red" and a "traitor") and declared that the health care bill is the "greatest threat to freedom that I have seen."

The greatest? Greater than Hitler's Nazism? Greater than Soviet communism?

With this remark, Boehner steered his GOP congressional caucus—and many members of it spoke at this Republican-supported rally—into the center of the wing-nut wing of his party. Two days after a moderate GOPer and a faux moderate GOPer won their respective gubernatorial races in New Jersey and Virginia—and a true-blue conservative Republican lost a congressional race in relatively conservative upstate New York—Boehner is doubling down with the Glenn Beck-following, Obama-hating extremists of the conservative movement. No wonder that the strategists at Democratic Party HQ have been saying, Thank you, Michele Bachmann. She's turned the No. 1 Republican in the House into a Tea Party stooge.

You can follow David Corn's postings and media appearances via Twitter. More coverage of the Tea Party rally from Mother Jones' Stephanie Mencimer is coming soon.

Baseball Finance Reform: Time to Cut A-Rod's Salary

| Thu Nov. 5, 2009 3:31 PM EST

When the Philadelphia Phillies lost the World Series to the New York Yankees last night, I felt anger, heartbreak, frustration and the burning desire for a salary cap in Major League Baseball. Of course, I’m happy for those who saw their team win the World Series. But in the 108 years that the Yankees have been around, they’ve won the World Series a whopping 27 times. That's right: 25 percent of the time. And in the 126 years that the Phillies have been around, they've won twice. Yep, two percent of the time (rounded up).

And that's no mistake. In the past decades (and the foreseeable future) the Yanks have held a crushing financial advantage over all other major league franchises. This year, for example, the Yankees spent $208 million on player salaries, more than $60 million more than the second highest-paid team (The Mets) and nearly what the Phillies spent on their payroll ($111 million). A-Rod alone made $33 million this year, nearly a third of the entire Phillies payroll.

Baseball needs a salary cap. Think of it like campaign finance reform in politics. If the world’s richest donors could shovel all their cash to a single candidate, that person would flood the market with advertising and crush his or her opponent. But the government has deemed this unfair because it elevates the influence of rich voters above poor voters. Without a salary cap, the MLB elevates the hopes of fans in rich cities over fans in poor cities. Baseball is supposed to be about home team rivalries and anxious competition, not the size of each team's checkbook. Forgoing a salary cap allows rich teams like the Yankees to swallow up promising talent when it matures, which is too un-American for America's favorite past time.

Sanctioning Iran

| Thu Nov. 5, 2009 3:12 PM EST

Dave Schuler thinks it's time to crack down on Iran:

We should implement consequences for Iran as stern as we can make them, non-violent in nature but punitive in quality. We should muster all of the permanent members of the Security Council to participate in these measures but be prepared to proceed without them. A peaceful, prosperous, and just Iran is in Russian and Chinese interests as it is in ours and, if they elect to support tyranny in Iran, Russia and China should be made aware that this latest tyranny in Iran will eventually end and the Iranian people will know who supported the tyrants and who opposed them.

Setting aside the question of whether this is wise or not, I don't quite get what the sanctions crowd is after.  We have no diplomatic relations with Iran.  Trade is embargoed and imports are prohibited.  (Except for Persian rugs!)  We sanction foreign companies who do business with Iran.  Investment in Iran is prohibited.  The Treasury Departments forbids banks from processing even indirect financial transactions with Iran.  There's a little more we could do, but not much.

As for Russia and China, sure, the current U.S. sanctions would have a lot more bite if the rest of the world joined in.  But what leverage do we have to make that happen?  Hell, even Europe isn't on board with our sanctions regime, let alone China and Russia.  There's just not a lot we can do on that front.

Is there anything more of any real consequence that the U.S. could do unilaterally?  Is there anything serious the U.S. could do to get the rest of the world to support us?  I don't really see it.  What am I missing here? 

Fiore Cartoon: Ugly Democracy

Thu Nov. 5, 2009 2:17 PM EST

America is known for doing undemocratic things in the name of democracy. Recent example: Afghanistan.

Watch Mark Fiore's cartoon below, as he muses: Democracy isn't always pretty. But shouldn't it at least be kind of attractive? 

Winners and Losers

| Thu Nov. 5, 2009 1:43 PM EST

Felix Salmon is back from vacation and he's tanned, rested, and ready.  Today he notes that Goldman Sachs and Wells Fargo made big money on interest rate swaps last quarter and asks:

And there’s another question, too: if the likes of Wells Fargo and Goldman Sachs are making billions on these swaps, who’s on the other side of the trade? Who lost billions of dollars by swapping floating into fixed? Call it the Summers trade, after Larry’s disastrous foray into the rates market when he was at Harvard. It didn’t work then, and it clearly isn’t working now, either.

That's a good question.  In fact, I've long wondered about this more broadly: lots of derivatives bets are zero sum deals where winners are always matched up with losers.  So if the financial sector is making boatloads of money betting on derivatives,1 which sectors of the economy are the losers?

To be honest, my main interest in this is polemical.  It's not that I really care all that much about precisely who the winners are losers are, but I do think that public wrath against Wall Street might be very usefully stoked by learning who's paying off on all these bets.  In the case of about $13 billion in CDS winnings from Goldman Sachs, for example, the loser was AIG — and then the taxpayers graciously covered that bet when AIG went bust.  But it's not just banks and hedge funds on the other side of these bets, is it?  It's also pension funds, corporations, and state and local governments.  It would be illuminating, I think, if someone could track the flow of wins and losses in a way that made them a little more concrete for people.  Especially the losses.

1Aside from the late unpleasantness, of course.  But you know what I mean.

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Boxer Overrides GOP Boycott, Advances Climate Bill

| Thu Nov. 5, 2009 1:25 PM EST

Democrats on the Environment and Public Works Committee on Thursday voted to send the climate and energy bill from Barbara Boxer (D-Calif.) and John Kerry (D-Mass.) out of committee without amending it—thus overriding the Republican boycott of the markup.

According to committee rules, two members of the minority need to be present in order to begin marking up the bill. So the Democrats took advantage of a rule that allows them to simply report a bill out of committee with a simple majority vote, bypassing the markup altogether. It passed by 11 to 1. "It's unfortunate we had to go the route we did, but the Senate can't be paralyzed," said Boxer after the vote.  "We did what we had to do."

The only Democrat to vote against advancing the unamended bill was Max Baucus (D-Mont.). He outlined two specific areas that he had wanted to change—lowering the 2020 emissions reduction target to 17 percent, with the ability to raise it back to 20 percent if other nations follow suit, and adjustments to the agricultural provisions. But Baucus affirmed that he will work with others in the Senate to "get climate change legislation that can get 60 votes."

Wake Up Call for Dems

| Thu Nov. 5, 2009 1:13 PM EST

Democratic losses in Virginia and New Jersey are making Democratic congressmen nervous.  What will happen to them a year from now when they stand for reelection?

Exit polls circulating on the House floor Wednesday were even more unnerving to Democrats. The Republican candidates, the polls indicated, had received the votes of two-thirds of independent voters.

Now, as the entire House of Representatives and a third of the Senate prepare for next year's midterm elections, some moderate Democrats are wondering whether they can afford to follow President Obama's ambitious legislative agenda on such controversial issues as healthcare and climate change. One said the results were a "wake-up call."

"There are going to be a lot more tensions between the White House and Congress," predicted Rep. Jim Cooper (D-Tenn.), a member of the Blue Dog Coalition of fiscally conservative Democrats. "They've been under the surface so far — and they're going to come out in the open."

Cooper is probably just talking his own book, but even at that I don't really get his point of view.  My take on this is pretty different: if there's any broad lesson to be taken from Tuesday's election (about which I remain agnostic for the moment), it's this: independent voters are getting a little weary of endless political battles with no results.  The problem is not that Congress is trying to tackle too much, but that Congress isn't getting anything done. That's the wake-up call.

The answer to that is to get something done.  Pass healthcare reform, for example.  That would be (no pun intended) a huge shot in the arm for Dems of all stripes, demonstrating to skeptical voters that they can indeed govern effectively.  Ditto for financial regulation, which is a golden opportunity to harness some populist anger against the financial industry.  All Congress has to do is stand up to the finance lobby1 and put some serious constaints on Wall Street's ability to screw people.  Think that won't be popular?

As for Obama, he's probably suffering a bit from his lengthy reconsideration of Afghanistan, but once he decides on a way forward that will all be promptly forgotten.  Memories are short for this kind of thing.

My guess is that the Jim Coopers of the world have everything to gain and nothing to lose by loosening up, following Obama's lead, getting healthcare reform passed, and then following up with some meaty financial reform.  Nobody likes endless wankathons that don't produce results, but they love results once they finally come.  Dems need to have a few.2

1Yeah, yeah, I know.  What are the odds?  I have several thousand words on exactly that subject coming in the next issue of the print magazine.

2And they also need the economy to pick up.  That's not entirely under their control, but it's not entirely out of their control either.  Get cracking, folks.

Fake Plan, Real Score

| Thu Nov. 5, 2009 12:27 PM EST

House Republicans released a "healthcare plan" of their own yesterday, but I didn't bother blogging about it because it pretty transparently wasn't a real plan at all.  It was just a few thousand words of miscellaneous text designed to stop people from saying that Republicans don't have a plan.

Still, it has to be kind of embarassing to send if off to the CBO for scoring and have this come back.  Glurk.

Senate Source: Protesters Arrested on Hill

| Thu Nov. 5, 2009 12:11 PM EST

Rep. Michele Bachmann (R-Minn.) has encouraged opponents of the Democrats' health care reform to show up at Capitol Hill today at "high noon" to "look at the whites of their eyes and tell them, 'don't you dare take away my health care.'" Nothing "scares members of Congress more than freedom-loving Americans," Bachmann says. But the Capitol Police don't seem too scared—they're already rounding up protesters by the handful. A Senate source emails:

We had five people arrested in Hart [Senate Office Building] this morning. Two were literally carried out by Capitol Police, their arms and legs restrained, all the while screaming at the top of their lungs, drawing crowds of staffers and senators to the balconies and office windows of the east wing of the building.

The source couldn't say whether or not the protesters were associated with Bachmann's event—and since ABC News is reporting that eight pro-health care reform protesters were arrested near Sen. Joe Lieberman's office this morning, it's quite possible that the freedom-loving Americans weren't involved. Our own Stephanie Mencimer is on the hill today to cover the protest, so we'll keep you posted.