It's a testament to the difficulty of healthcare reform and the power of the healthcare lobby that it's able to make reform of Pentagon procurement look almost easy by comparison.  But that's how it's turned out: at the same time that President Obama's healthcare reform has been fighting through the congressional underbrush one painful subparagraph at a time, his defense cuts have practically sailed through.  Remarkably enough, he's succeeded almost completely in cutting back the weapons platforms he targeted earlier this year, and he's succeeded so quietly that I'd pretty much forgotten it was even happening.  But it did, and the defense appropriations bill Obama signed yesterday included nearly all the cuts he had asked for:

Rahm Emanuel, the White House chief of staff, said Wednesday that the plan was to threaten a veto over a prominent program — in this case, the F-22 fighter jet — “to show we were willing to expend political capital and could win on something that people thought we could not.”

Once the Senate voted in July to stop buying F-22s, Mr. Emanuel said in an interview, that success “reverberated down” to help sustain billions of dollars of cuts in Army modernization, missile defense and other programs.

....Military analysts said [Defense Secretary Robert] Gates, a holdover from the Bush administration, also aimed at the most bloated programs. And Senator John McCain of Arizona, the former Republican presidential candidate, who has criticized the Pentagon’s cost overruns, provided Mr. Obama with political cover to make the cuts without being seen as soft on the military.

“They probably get an ‘A’ from the standpoint of their success on their major initiatives,” said Fred Downey, a former Senate aide who is now vice president for national security at the Aerospace Industries Association. “They probably got all of them but one or maybe two, and that’s an extraordinarily high score.”

Yes, Obama and Gates mostly took on only the most egregiously bloated Pentagon programs and then plowed the money they saved into other areas, which probably cut down considerably on opposition grumbling.  Still, this is a landmark effort.  Cutting even a single bloated program is usually the work of years, and to cut three or four at once is unprecedented.

Having a conservative (and politically savvy) Defense Secretary like Gates carrying the ball for the program cuts was instrumental in getting them done, in the same way that having a conservative like Gates carrying the ball for ending DADT will probably be instrumental in getting it abolished next year.  I was sort of ambivalent about the Gates appointment when it was announced last year, but I have to admit that so far he's come through on the potential upside.

(Via Steve Benen.)

Fiore Cartoon: S.C.R.E.W. U.

In light of recent reform efforts, the credit card industry has implemented a new plan. They like to call it the Safe Credit Revision Everyone Wins Undertaking, otherwise known as S.C.R.E.W. U.

Watch satirist Mark Fiore outline the plan, which includes fees for breathing or being left or right-handed, below:

In testimony before Congress on Thursday, Steve Miller, CEO for American Coalition for Clean Coal Electricity, a major coal industry lobby group, stated under oath that his organization "has never opposed the Waxman-Markey bill."

But ACCCE's previous statements indicate otherwise. On the day that the House passed the legislation, Miller himself issued a press release stating, "ACCCE cannot support this bill, as it is written because the legislation still does not adequately protect consumers and the domestic economy."

In addition, documents released Thursday by a congressional investigation into 13 forged letters sent to Congress by an ACCCE subcontractor show that ACCCE spent nearly $3 million this year on so-called grassroots efforts to persuade vulnerable legislators to vote against the Waxman-Markey bill. (Miller did tell the House Select Committee for Energy Independence and Global Warming that ACCCE "supports federal carbon legislation that could include a mandatory cap-and-trade.")

An email exchange between ACCCE's contractor, the Hawthorn Group, and its subcontractor, Bonner and Associates, identifies seven House Democrats to be pressured to oppose the bill. The email describes Rep. Chris Carney (D-Pa.) as "a potential/probable 'no' vote on here so we're doing a little more intel to determine whether or not to keep him on our target list." The goal was clearly to convince members to vote against the measure. Once they were known to oppose it, they could be taken off the list.

Carney did indeed go on to vote against Waxman-Markey, along with five of the other targeted members. Yet ACCCE testified on Thursday that they did not actively campaign to get members to vote against the bill.

The coal industry group wasn't the only one making questionable claims in the hearing. Jack Bonner, head of Bonner and Associates—the ACCCE subcontractor that sent the forged letters—testified that his organization made a sincere effort to reach out to the community organizations whose names were misappropriated, as well as the lawmakers who received the forgeries. But the written and oral testimony from both Bonner and the community groups makes it clear that Bonner took its time. The Waxman-Markey vote was on June 26, and ACCCE, Bonner and Hawthorn all knew about the forgeries at least 48 hours before that. "Our immediate reaction to the fraud was to advise our client and reach out to the organizations," Bonner told Congress. Yet Bonner staffers didn't actually begin reaching out until June 29 (to one of the community organizations) and July 1 (to members of Congress). They didn't speak to the staff of two forgery recipients until July 13, and never contacted Carney's office at all. Lisa Maatz, director of public policy and government relations for the American Association of University Women, said she only learned about a fake letter bearing her organization's name by reading about it in the newspaper. Hilary Shelton, senior vice president for advocacy and policy of the NAACP, said his group found out when contacted by the media.

By the end of Thursday's hearing, only Select Committee Chairman Ed Markey (D-Mass.) and Jay Inslee (D-Wa.) were present to grill the witnesses. But they evidently weren't satisfied with the answers they received: After the hearing, Markey indicated that his committee will continue looking into the case.

Iowans aren't accustomed to paying politicians to speak at their events.  Just the opposite, in fact: as the kick-off state for the presidential primary season, most politicians are so eager to speak in Iowa that they're almost willing to pay for the privilege.

But not Sarah Palin!  She's hungry for scratch, and Iowans have to pay up the same as anyone else:

A conservative Iowa group’s effort to lure Sarah Palin to its banquet next month has had an unintended effect: Rather than exciting conservatives about the prospect of a visit from the former Alaska governor, the group’s plan to raise a six-figure sum to bring her to the state has GOP activists recoiling at the thought of paying to land a politician's speaking appearance.

Matt Yglesias is cynical: "The hard-right loves Sarah Palin and wants her to be president, but she really just wants to cash in." Nick Baumann isn't so sure: "Running for President does mean sucking up to Iowans, and if Sarah Palin isn't willing to do that, she either has an outrageously inflated sense of her own importance or she isn't planning on running. You can probably find evidence for either of those explanations."

Why yes you can.  Or both!  As for myself, I go back and forth on whether Palin plans to run for president in 2012.  At times, it really does seem as if the 2008 campaign made her realize that the rigors of big-time politics weren't for her.  On the other hand, she really, really loves the spotlight, and what's a bigger stage than the White House?  But if she planned to run, would she really be quite so obviously frenzied about cashing in on her notoriety while she has a chance?  Still, Nick is right: her sense of self-importance is so manifest that you can practically see her measuring the Oval Office drapes when she makes public appearances.  But surely her advisors know perfectly well that she has absolutely no chance of beating Barack Obama and will let her know that?  Maybe so, but that might just mean she'll find herself new advisors.  The ability of people to convince themselves that they can win the presidency (Fred Thompson?  Chris Dodd?  Seriously?) is the stuff of legend.

So I don't know.  I'd put it at about 50-50.  Or maybe 45-55.  If I had to bet, I'd say she won't run.  But I wouldn't bet very much.  Give her another year or two and she might very well delude herself into thinking that the American people are really, really yearning for her to be the leader of the free world.  After all, they love her book, don't they?

POSTSCRIPT: If you want to know the truth, this post is really just an excuse to include that picture of Palin, captured some time ago from her old Twitter page.  It cracks me up.  The first time I saw it she reminded me of some Paul Bunyanesque giant gazing down curiously on the antlike peasants below — perhaps just before rampaging over the Alaskan tundra and crushing a few villages in the process.  Or maybe I just have an odd sense of humor?

UPDATE: As is so often the case with Palin, it turns out that the real story here is murky.  Is she really asking for $100,000?  Is she even planning to be in Iowa at all?  Maybe not.  More here.

The American public could learn more about George W. Bush and Dick Cheney's torture and rendition policies on Friday if the Obama administration follows through on a promise to review a number of internal Bush administration documents. Earlier this month, the administration vowed to make its "best efforts" to process some 224 documents by October 30 to determine what can be publicly released. Government lawyers acknowledged last month that these documents are potentially responsive to a years-old ACLU Freedom of Information Act request for information relating to the death, treatment, and rendition of detainees.

The Bush administration initially considered these documents to be unrelated to the ACLU's FOIA request. But when the Obama administration reviewed a large number of Bush-era documents under its new, less restrictive FOIA guidelines, it reached a different conclusion. The Obama team, however, couldn't find ten of the documents that the Bush administration had originally listed in court filings.

In September, the Obama administration sent these 224 new documents to the CIA and other agencies for possible release. If government lawyers decide they can't justify withholding any of the 224 documents, those records could be made public Friday. "Hopefully they will stick to that date, and hopefully we will get something," says Alex Abdo, an ACLU lawyer working on the ongoing litigation concerning the FOIA request. " If I were to guess, I would say that we will likely get at least a few documents, but it is really hard to know just yet."

But there is one hitch: John Durham, a special prosecutor appointed by the Bush administration to look into the CIA's destruction of interrogation videotapes, could conceivably preempt the release of any documents. In a filing last week in a related case, government lawyers said that Durham was claiming that the release of certain documents could interfere with his investigation and were off-limits. If Durham attempts to block the release of these documents, a court would have to decide whether his assertion of privilege was justified.

As Mother Jones has reported, one document that could be released is a 59-page Department of Defense top-secret memo from July 25, 2002. The document was actually just misfiled by the CIA, and the Obama team found it and sent it to the Pentagon for processing last month. The document is thought to outline the torture techniques, perhaps as part of an argument for using those techniques on detainees.

Atrios:

Last night at a roundtable for our nations's elite, that is to say, "bloggers," Richard Trumka, AFL-CIO President, implied, though did not say outright, that one consequence of the real estate bubble was that manufacturing and other types of businesses were finding it difficult to obtain credit at favorable terms. As I said, this seemed to be the gist of what he was saying though I'm not 100% sure that was his point. So I'm curious! How much was credit being funneled away from all other sectors in the economy?

I'd like to know too, though I'm not sure what the best measure of this would be.  But I've always thought that one of the most worrisome aspects of the recent credit bubble was the fact that it was at least partly driven by Ben Bernanke's famous "savings glut," big pools of money from Asia looking for a home.  Unfortunately, there weren't enough genuinely productive invesment opportunities to soak up all that money, so instead it ended up on Wall Street where it got funneled into a housing bubble and lots of financial engineering.

But why weren't there enough good, traditional places to invest that money?  And by "traditional" I mean people who want to build factories or expand call centers or start up biotech ventures.  That is, businesses that provide goods and services to meet demand from consumers and corporations.  The supply side of the economy may have been going great guns, but the demand side wasn't keeping up.  This is why some people think it's better to talk about this phenomenon as an "investment drought."

A lot of this has to do with the distribution of income that Steve Randy Waldman blogged about the other day: demand for goods and services is primarily driven by consumers, and if their wages aren't increasing then demand for goods and services can't increase very much either.  So instead excess money flows to Wall Street, where it gets loaned out to consumers as a substitute for wage growth.  Eventually, though, it becomes obvious that they can't take on any more debt, and then comes the crash.

So what happens next?  If we want stable growth, it really needs to be based on consumer demand, and that in turn mostly means middle class demand.  That demand will then provide investment opportunities for capital.  But that all depends on broad, sustained wage growth for the middle class, and as far as I can tell no one is talking much about how to promote that.  If that stays the case, and income inequality continues to rise once we're out of the woods, how far out can another crash be?

Economic Dishonesty

This John Schmitt takedown of economist/New York Times blogger Casey Mulligan seems pretty damning. Mulligan made the argument that requiring paid sick days is counterproductive because it causes people to stay home when they are not sick. Schmitt explains why this could be wrong:

The current system—which does not require employers to provide paid sick days and leaves upwards of 50 million workers without paid sick days—gives strong incentives to workers to go to work sick, lowering productivity and potentially spreading illness.

Of course, offering paid sick days also gives workers incentives to take time off when they are not sick. There is nothing in Mulligan's post that says where we should set the optimal level. He doesn't even make a case that the most generous systems in Europe are too generous, just that they lead to more sickness absences in some cases. For all we know, after we factor in the cost of contagious diseases, the most generous European systems might still be too stingy.

Here's where it gets embarassing for Mulligan and the Times. To support his point, Mulligan published a graph showing how the Netherlands, Sweden, and Norway, which have statutory sick leave laws, all have higher absenteeism than the United States.

But Mulligan pulled very selectively from his source material, a chart by the International Monetary Fund. Here's the real chart:

Over to you, John:

In the original, Denmark, Germany, and seven other countries with more generous statutory paid sick days policies all have lower sickness absence rates than the United States. A really interesting question is: how is it that these countries are able to provide both guaranteed paid sick days and lower sickness absence rates? (And why didn't Mulligan include these countries in his graph?)

Um, because he was being dishonest?

 

Sarah Palin's words of wisdom come at a high price:

A conservative Iowa group’s effort to lure Sarah Palin to its banquet next month has had an unintended effect: Rather than exciting conservatives about the prospect of a visit from the former Alaska governor, the group’s plan to raise a six-figure sum to bring her to the state has GOP activists recoiling at the thought of paying to land a politician's speaking appearance.

In most states, groups pay for speakers to attend their events all the time. Iowa conservatives are used to getting their speakers for free because their state holds the first contests of each party's nomination contests. But running for President does mean sucking up to Iowans, and if Sarah Palin isn't willing to do that, she either has an outrageously inflated sense of her own importance or she isn't planning on running. You can probably find evidence for either of those explanations.

Is the Recession Over?

No surprise here: GDP was up 3.5% in the third quarter.  But is the growth sustainable?

The cash-for-clunkers program helped boost consumer spending on durable goods....Similarly, economists say the $8,000 federal tax credit for first-time homebuyers helped revive spending on housing.

....Stagnant consumer demand and withering consumer confidence have left companies wary of hiring more employees — or, for that matter, taking any expensive risks. The jobless rate reached 9.8 percent in September, its highest rate in 26 years. According to Thursday’s report, business investment in buildings and other structures fell at an annual rate of 9 percent in the third quarter.

The Wall Street Journal also provides a note of skepticism: "Since the federal stimulus reached its maximum effect in the third quarter and the unemployment rate remains high, there's uncertainty over the sustainability of the recovery."  As for myself, I'm curious to know not just where the growth is coming from, but where it's going to. Wage growth has been weak this year, and there's not much sign that the recovery in Q3 did much to change that.  So who's getting the bulk of the benefit?

Two weeks before the House voted on the historic Waxman-Markey climate bill, a number of key Democrats received letters purportedly from minority groups, urging them to oppose the legislation. The now infamous letters turned out to be forgeries generated by Bonner and Associates, a political consulting firm working on behalf of the coal industry. The story of exactly how the letters found their way to Congress has remained murky, and Bonner has repeatedly blamed the incident on a renegade temp. But documents released today by a congressional investigation and viewed by Mother Jones lift the lid on Bonner's inner workings—offering fresh evidence that deceptive tactics weren't an anomaly for the firm, but were built into its standard operating procedure.

The documents show that Bonner was officially hired on June 10 by the Hawthorn Group, a communications firm which had in turn been enlisted by the American Coalition for Clean Coal Electricity (ACCCE), a coal industry lobby. The contract was verbal, according to material Bonner provided to the House Select Committee for Energy Independence and Global Warming. Nothing was committed to paper.

In an email to Bonner headed "Ready to Rumble," Hawthorn lists seven key Democratic targets it believed could be pressured to vote against the bill. Hawthorn also named specific interest groups it hoped would write letters opposing the legislation—especially organizations “representing the interests of veterans, senior citizens, minorities, and other groups," according to the documents. The email requests Bonner to produce five letters from such groups in the district of each targeted lawmaker.

The investigation offers a rare glimpse into Bonner's operations—and by extension the shadowy art of astroturfing. A sample script provided to Bonner employees directs them to mislead listeners about who they represent in order to rustle up letters. "Hi xyz, I am working with seniors/retirees to help stop their utility bills from doubling," reads one script. "Hi xyz, I am working with vets/veterans/veterans organizations to help stop their utility bills from doubling," reads another. As this longer extract shows, at no point do the scripts instruct the callers to reveal that they work for the coal industry:

I am working with seniors to stop an increase in their utility bills. Do you know any senior [sic] that are struggling to get by on Social Security? {wait for response} What would happen if their utility bill doubled? Would they not run the air-conditioner in the summer or not have heat in the winter? What else might they cut out of their budget to have electricity ... food ... medicine? I have a letter that other senior groups have wrote would you write a similar one (OR) would you sign a similar letter?