Mojo - March 2009

Treasury Resisting TARP Transparency, Oversight

| Tue Mar. 31, 2009 6:06 PM EDT | Scheduled to publish Tue Mar. 31, 2009 6:06 PM EDT

At a hearing of the Senate Committee on Finance on Tuesday, two oversight chiefs delivered harsh criticism of the Treasury Department's lack of accountability and transparency in its Troubled Asset Relief Program.

Neil Barofsky, the Special Inspector General of TARP, testified that the Treasury has yet to require TARP recipients to deliver reports disclosing exactly how they are spending taxpayer money. "[C]omplaints that it was impractical or impossible for banks to detail how they used TARP funds were unfounded," Barofsky said. "While some banks indicated that they had procedures for monitoring their use of TARP money, others did not but were still able to give information on their use of funds."

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GAO: Bailed-out Banks Paying Dividends

| Tue Mar. 31, 2009 5:39 PM EDT | Scheduled to publish Tue Mar. 31, 2009 5:39 PM EDT

On Tuesday, the Government Accountability Office released its latest report on the Troubled Asset Relief Program. Like everything the GAO puts out, the report is long and wonky, but to summarize, the GAO thinks the Treasury is a bit disorganized: It hasn't hired asset managers to oversee bailout repayment agreements and needs a better communication strategy "should it need additional funding" for TARP.

This is hardly surprising considering it was just last week that President Obama moved to fill the high-level vacancies at the Treasury. But it's hard to see why the Treasury wasn't on top of filling those spots sooner: the pool of available asset managers certainly hasn't run dry.

The most interesting nugget of information comes later in the report, where the GAO notes TARP recipients have paid the Treasury $2.9 billion in dividends through March 30. Around $2.5 billion of that was paid by banks that gave the government preferred stock in exchange for bailout funds—the exchange otherwise known as the Capital Purchase Program. The Treasury has paid out $199 billion in CPP funds so far, so the government has recouped 1.25 percent of its money in the last six months.

America's Studliest State Rep Lives in Olympia, WA

| Tue Mar. 31, 2009 4:51 PM EDT
State Representative Geoff Simpson of Olympia, Washington, has had it with chain emails from foot soldiers of the Christian Right. He's read the Bible and he's hitting back, and likely violating every rule he was taught in Staying In Office 101 in the process.

Public Financing Bill: Go Time!

| Tue Mar. 31, 2009 4:19 PM EDT

The public financing bill that I mentioned last week was introduced in Congress Tuesday. It's called the Fair Elections Now Act, and good government groups are already lining up behind it. Here's Common Cause, in an email to supporters:

Our nation is facing many challenges. But instead of focusing on addressing important issues like jobs, the economy and healthcare, elected officials in Washington are spending countless hours fundraising to make sure they can afford to run their next campaign.

And the problem is getting worse. Because the costs of campaigns are skyrocketing, our officials are more and more dependent on big contributions from wealthy donors and lobbyists, giving special interests undue influence over important policy decisions.

We need our leaders to spend more time on the job, instead of on the fundraising circuit. The bipartisan Fair Elections Now Act – introduced in Congress today – will make that possible.

Common Cause suggests you go this site and send a form email to your representatives.

Public Campaign Action Fund and Democracy 21 also quickly climbed on board. You can learn more about the bill at the website of Sen. Dick Durbin (D-Ill.), one of the co-sponsors of the bill.

Update: Change Congress gets in the game with a nifty vote whipping tool.

Obama White House Close to Settling Missing Emails Case

| Tue Mar. 31, 2009 12:37 PM EDT

The long saga of the missing White House emails may be finally nearing its end. The Obama administration and two nonprofits that are suing it over millions of missing Bush-era emails have called a truce. A joint motion (PDF) and proposed order (PDF) filed by Justice Department lawyers and the plaintiffs, the National Security Archive and Citizens for Responsibility and Ethics in Washington (CREW), call for an indefinite stay of the case so the two sides can continue settlement negotiations. Both the White House and the nonprofits will have to withdraw their pending motions (including a White House motion to dismiss the case) and update the court on settlement proceedings in three months. But the whole ordeal could be over well before that—if contentious issues are resolved in the next few days or weeks.

"We just got a stay from the judge to give us some room to try to work things out," says Meredith Fuchs, the general counsel for the National Security Archive. "It will take a while before we know whether our talks are successful because our ability to resolve the case depends on nailing down lots of details: what happened, was it fixed, and will it happen again."

The National Security Archive and CREW have been pushing the White House to disclose information about millions of missing emails for years. The case began in 2007, after the Bush administration warned that it may have lost millions of emails that should have been archived under federal record-keeping laws. That brought the lawsuit to force the recovery of the emails and the adoption of a better archiving system. Bush administration lawyers fought the plaintiffs tooth and nail, successfully passing the buck to the next administration and keeping secret the details of how and why the emails were lost. In January, the Obama administration became the defendant in the case, and at first showed signs of continuing the Bush administration's legal strategy, filing a motion to dismiss the case the day after the new team took office. It's unclear what the Obama White House is now offering. But, no doubt, its more than what the Bush administration ever put on the table.

Pentagon Bloat Continues Apace

| Tue Mar. 31, 2009 12:22 PM EDT
As Nick Baumann has reported here and here, Defense Secretary Robert Gates is in the midst revamping the Pentagon's defense acquisitions programs, preparing to kill those that have been draining the most funds from government coffers, such as the the F-22 fighter and the Zumwalt-class destroyer. If you need more evidence that there's a problem, see the GAO's seventh-annual report (.pdf) on cost overruns in selected Pentagon weapons systems. The government auditor found that the number of major defense spending programs has grown from 77 to 96 since the beginning of the Iraq War. Not surprisingly, costs have continued on their upward march from $1.2 trillion to $1.6 trillion over the same period, with R&D costs now an average of 42 percent over budget. More programs, more money, and, yes, more delays. Initial delivery on DOD program investments now averages 22 months. The reason for much of this is that our military seldom looks before it leaps: the services routinely budget big-ticket projects before the basic technology is in place, meaning that development is routinely delayed as technological hurdles emerge. From the GAO:
A majority of the programs GAO assessed were unable to fill all authorized program office positions, resulting in increased workloads, a reliance on support contractors, and less personnel to conduct oversight. In December 2008, DOD revised its policy for major defense acquisition programs to place more emphasis on acquiring knowledge about requirements, technology, and design before programs start and maintaining discipline once they begin. The policy recommends holding early systems engineering reviews; includes a requirement for early prototyping; and establishes review boards to monitor requirements changes--all positive steps. Some programs we assessed have begun implementing these changes.

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Welcome, Fox Nation!

| Tue Mar. 31, 2009 12:11 PM EDT

Have you checked it out yet? Fox is going to the Internets with an aggregator site that will try to lure conservative HuffPo-types (the homepage is similar even). Their top stories right now feature a picture of Spicoli (the only Sean Penn Bill O'Reilly likes), and  instead of an About Us page (because that phrase would be too Democratic?) they offer Our Purpose instead:

The Fox Nation was created for people who believe in the United States of America and its ideals, as expressed in the Constitution, the Declaration of Independence, and the Emancipation Proclamation. It is a community that believes in the American Dream: Life, liberty, and the pursuit of happiness. One that believes being an American is an honor, as well as a great responsibility—and a wonderful adventure.
This is a place for people who believe we live in a great country, a welcoming refuge for legal immigrants who want to contribute their talent and abilities to make our way of life even greater. We believe we should enjoy the company and support of each other, delighting in the creativity, ingenuity, and work ethic of one and all, while observing the basic rules of civility and mutual respect and, most importantly, strengthening our diverse society by striving for unity.
The Fox Nation is for those committed to the core principles of tolerance, open debate, civil discourse--and fair and balanced coverage of the news. It is for those opposed to intolerance, excessive government control of our lives, and attempts to monopolize opinion or suppress freedom of thought, expression, and worship. We invite all Americans who share these values to join us here at Fox Nation.

Why is it that the language of the right feels like a history textbook? And liberals don't believe in the American Dream, the Emancipation Proclamation? Plus, they go all Spider-Man on us with the great honor and great responsibility business. These tenets feel basic, it's the nuance where we disagree, the policies that make for a "great country." But never mind nuance, I'm still stuck on the "basic rules of civility" part, not exactly a guiding principle at Fox News.

News Flash: Americans (Still) Love Obama

| Tue Mar. 31, 2009 10:36 AM EDT

I've long believed that there is a fundamental disconnect between Washington's pundit class and the American people as a whole. It's not a fault of the pundits' -- their life and work experiences don't put them in touch with anyone from roughly 45 of the 50 American states, and those people that they do meet tend to work in a small set of professions and industries. (Their only sin is not acknowledging the limits of their expertise and predictive abilities.) It is because of that disconnect that you can have TV commentators, journalists, and bloggers debating whether Obama's honeymoon is over when numbers like this suggest it is not a question open for debate:

The percentage of Americans in the new poll who said the country is on the right track still stands at just 42 percent, but that is the highest percentage saying so in five years and marks a sharp turnabout from last fall, when as many as nine in 10 said the country was heading in the wrong direction....

Overall perceptions about the country parallel a rapid increase in the percentage of Americans who say the economy is improving. For the first time since late 2004, the gap between the numbers saying the economy is getting better and those saying it's getting worse is in the single digits (27 percent to 36 percent).

Two-thirds of Americans approve of the way Obama is handling the country's top job, and six in 10 give him good marks on issue No. 1, the flagging economy.

And this suggests that Democrats, independents, and likely some moderate Republicans reject the GOP's back-to-the-future "tax and spend" trope:

At the same time, 62 percent see Obama as a "new-style," fiscally responsible Democrat; fewer, about a third, label him an "old-style" Democrat oriented toward taxing and spending.

Time to get some new rhetoric, Karl Rove.

Exclusive: Rachel Maddow's Anxiety Dream (and More Video Highlights From Her MoJo Gala)

| Mon Mar. 30, 2009 3:42 PM EDT

Talk about MoJo rising! Rachel Maddow did us a huge solid and came to San Francisco to appear at a jam- and star-packed fundraiser for Mother Jones on Saturday, March 28. Before a sold-out crowd at Yerba Buena Center for the Arts, she talked with Monika and me about everything from why women are closeted about being smart, to her impending interview with Colin Powell, what she'd ask Dick Cheney, Tweeting vs. blogging, her David Petraeus work anxiety dream, and why America needs to do more to ensure the future of serious investigative reporting and editing. Special props to Rachel for recognizing how newscasters depend on print reporting for the building blocks of their shows; "without the [MoJo DC bureau chief] David Corns of the world, there's no show. David Corn can do his job without me, but I can't do my job without him."

And if all that weren't fun and ego boosting enough, it was officially "Mother Jones Day" in San Francisco on Saturday (see proclamation after the jump)—whereby, according to SF Supervisor Bevan Dufty and California State Senator Mark Leno, nobody on staff could get arrested. Good thing, because at a reception before the big show, local mixologist extraordinaire Thad Vogler was making a killer signature cocktail, "The Maddow," and even those of us who had to get on stage and talk serious policy had a hard time saying no.

Rachel mixed it up with her adoring fans after the show, and everybody had an awesome time. Check out our exclusive videos, and (after the jump) the recipe to The Maddow and the Mother Jones Day proclamation.

10 Video Clips of Rachel Maddow in Conversation With MoJo Editors Clara Jeffery and Monika Bauerlein

1) The Venn diagram of Rachel: Entertainer, journalist, self-indulgent dork.

2) The show on Afghanistan, ratings be damned.

3) The reason America needs full time reporters and editors, not hobbyists.

4) Why she's not closeted about being smart.

5) The lowdown on Tweeting vs. blogging.

6) The David Petraeus work anxiety dream.

7) The drink she would have fixed Lincoln.

8) The reporters she trusts on the bailout.

9) The state of the 4th Estate.

10) The reason she's optimistic about the country's future.

Click Here to Launch a Photo Slideshow of the Evening.

Then mix yourself a Maddow* and go watch Rachel's show tonight.

Wall Street, Above All Else

| Mon Mar. 30, 2009 2:23 PM EDT

Former IMF chief economist Simon Johnson, writing in the Atlantic Monthly (via Open Left):

Top investment bankers and government officials like to lay the blame for the current crisis on the lowering of U.S. interest rates after the dotcom bust or, even better—in a "buck stops somewhere else" sort of way—on the flow of savings out of China. Some on the right like to complain about Fannie Mae or Freddie Mac, or even about longer-standing efforts to promote broader homeownership. And, of course, it is axiomatic to everyone that the regulators responsible for "safety and soundness" were fast asleep at the wheel.

But these various policies—lightweight regulation, cheap money, the unwritten Chinese-American economic alliance, the promotion of homeownership—had something in common. Even though some are traditionally associated with Democrats and some with Republicans, they all benefited the financial sector....

From 1973 to 1985, the financial sector never earned more than 16 percent of domestic corporate profits. In 1986, that figure reached 19 percent. In the 1990s, it oscillated between 21 percent and 30 percent, higher than it had ever been in the postwar period. This decade, it reached 41 percent. Pay rose just as dramatically. From 1948 to 1982, average compensation in the financial sector ranged between 99 percent and 108 percent of the average for all domestic private industries. From 1983, it shot upward, reaching 181 percent in 2007.

The great wealth that the financial sector created and concentrated gave bankers enormous political weight—a weight not seen in the U.S. since the era of J.P. Morgan (the man).

You should read the whole thing.