Mojo - January 2010

Who is Obama?

| Thu Jan. 21, 2010 4:27 PM EST

White House photo/Pete Souza (Government Work).White House photo/Pete Souza (Government Work).Liberals are as depressed right now as they've ever been. A Republican will fill out the remainder of Ted Kennedy's term in the Senate. Health care reform is on the brink of collapse. The Supreme Court has decided to allow corporations to spend unlimited amounts of money on election advertising. And President Obama is on the verge of losing Paul Krugman, who is disappointed that the White House isn't pushing Congress to forge ahead on health care reform:

I’m pretty close to giving up on Mr. Obama, who seems determined to confirm every doubt I and others ever had about whether he was ready to fight for what his supporters believed in.

Andrew Sullivan disagrees:

Let this process play out. Let Obama use SOTU to argue that nothing is not an option and if the Republicans prove they really do want nothing, then the argument for passing the Senate [health care] bill gets stronger. But doing this now, greeting public anxiety with contempt, would be dreadful politics.

It would destroy Obama's commitment to open dialogue and respect for the process, which has already been battered by some of the necessary sausage making to get a final deal. It would make Obama look like a brutally partisan president. That would break Obama's presidency.

Kevin says that's wrong:

Obama is already a brutally partisan president. He just doesn't seem to know it. But it only takes one side to make politics into a partisan slugfest, and at this point the only credible response is to slug back.... We either pass [health care reform] now or else wait another 15 years. It's time for Obama to buck up and show us what he's made of.

While a week seems like a lifetime in politics, it's really only a week. The State of the Union is on Wednesday. Obama will have the stage to himself. What he says will set the tone for the rest of this Congress—and what happens during the rest of this Congress will set the tone for the November elections, which will determine how the rest of Obama's first (and perhaps only) term plays out.

It's been a year since the inauguration, and Obama remains an enigma. No one really knows what to expect from him next week. What will he say? Will he break type and take the fight to the Republicans—perhaps by tying them to Bush in a way he has so far refused to do? Will he continue to reach out a hand to the GOP, even though his overtures have been slapped down time and time again? How will he lead his own party? What will he say about health care reform?

It definitely seems that big strategy changes are afoot in the White House—today's embrace of tougher bank regulations—pushed by Paul Volcker, the former fed chair and current Economic Recovery Advisory Board chief—is one signal of that.

But perhaps even more interesting was the White House's response to the Supreme Court's decision Thursday morning to strike down legal barriers on corporate spending in elections. Obama's statement was unusually direct, promising to "get to work immediately with Congress on this issue" to develop a "forceful" response. The standard political assumption, of course, is that voters don't care about "process issues" like campaign finance. But in the wake of the bank bailouts, with Congress appearing more beholden to big business than ever, that assumption might be wrong.

Congress is incredibly unpopular, and reforming election laws could be spun as taking on Congress—and Washington's "culture of corruption." The White House has so far avoided blaming Congress for much because they were trying to pass health care. "Politically, that's been like having Bernie Madoff in the cabinet," one White House aide told Time. Pushing for tougher disclosure laws, or even publicly funded elections, could be a smart bet for the White House right now. John McCain animated independent voters with his "straight talk" about campaign finance issues during his campaign for the Republican presidential nomination in 2000. If anyone could get people to care about those issues again, it's Barack Obama. But if he doesn't have the stomach to fight for the health care bill, how will he push for election reform?

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The Supreme Court's Gift to the Chamber of Commerce

| Thu Jan. 21, 2010 3:42 PM EST

Green groups are lambasting Thursday's Supreme Court decision striking down limits on corporate election advertising as a handout to dirty energy interests, big business groups, and other foes of environmental regulations.

Cathy Duvall, political director of Sierra Club, warned in a statement that the ruling will unleash a "tidal wave of special interest cash and influence peddling" on the electoral process. The decision, Duvall noted, will give even more power to major lobbying groups, such as the Chamber of Commerce, that regularly oppose environmental regulations. The Chamber's Michigan division was a party to one of the campaign finance cases the Court ruled on today, which could allow the organization to spend similar sums on political advertising as it currently does on lobbying. According to fourth-quarter filings released yesterday, the Chamber spent $71 million on lobbying last quarter, bringing the group's 2009 total to $123 million, more than it has ever spent. By comparison, its political action committee has been spending small change—just $248,381 in 2008 and $235,233 in 2006. The Chamber has pledged to wage its "most aggressive" election fight ever in 2010, and earlier announced it had amassed a $100 million war chest for lobbying and political advocacy this year.

Gene Karpinski, president of the League of Conservation Voters, said the decision will "open the floodgates for oil companies like Exxon." He noted that Exxon Mobil's PAC spent just over $811,000 on the 2008 election, but would now be free to pour massive sums into political advertising—"potentially drowning out the voices of the majority of Americans who support investing in clean American energy and reducing harmful carbon pollution."

Are Contractors Undermining US War Efforts?

| Thu Jan. 21, 2010 2:56 PM EST

Gun-carrying contractors working for the Defense Department now account for between 22 and 30 percent of the total armed force in Afghanistan, according to a new report [PDF] by the Congressional Research Service. And between June and September 2009, the number of armed security contractors in the country spiked by more than 100 percent. This sharp increase is likely to continue as the Obama administration deploys 30,000 more troops to the country.

The figures reported by CRS are limited to armed contractors employed by the Pentagon in Iraq and Afghanistan (see my former MoJo colleague Justin Elliot for a good rundown of the numbers). In Afghanistan, factoring in security contractors employed by other US agencies (namely USAID and the State Department), and those working for corporate clients, NGOs, and foreign governments, the ratio of armed contractors to US troops is vastly higher. By some estimates there are as many as 70,000 security contractors working in Afghanistan, as compared to 68,000 US troops currently on the ground, a large percentage of them serving in a support, not a combat, capacity. The truth is that no one is quite clear on how many security contractors are actually working in Afghanistan—not even the government agencies paying their salaries, a fact the GAO has highlighted [PDF] in the past.

Many of the armed contractors in Afghanistan are locals who work for companies that are effectively illegal—they operate unlicensed and outside of the regulatory framework overseen by the country's Ministry of Interior. Here, the term contractor applies loosely—many are just dudes with guns attached to local militias or associated with provincial powerbrokers who have set up their own private security companies (PSCs). According to CRS, "Many analysts believe that regulations governing PSCs are only enforced in Kabul; outside Kabul there is no government reach at present and local governors, chiefs of police, and politicians run their own illegal PSCs." These illegal operations serve various clients, including, the CRS report notes, "NATO and the U.S. Government." This means that as the US and NATO are actively pushing to strengthen Afghan governance, they are simultaneously empowering players who are flouting Afghan law.

Even Pelosi Wavers on Health Care

| Thu Jan. 21, 2010 2:40 PM EST

The fate of health-care legislation looks more ominous by the day. Today, House speaker Nancy Pelosi (D-Calif.) told reporters there aren't enough votes in the House to even pass the weaker Senate version, let alone a House-Senate compromise on health care. She also said there's no timeline in mind for getting a bill of some kind passed, an indication that the health-care-induced logjam is far from over. This could reflect the lingering doubt stemming from the Massachusetts special election, but either way it doesn't bode well. TPM reports:

"I don't see the votes for it at this time," Pelosi said. "The members have been very clear in our caucus about the fact that they didn't like it before it had the Nebraska provision and some of the other provisions that are unpalatable to them."

"In every meeting that we have had, there would be nothing to give me any thought that that bill could pass right now the way that it is," she said. "There isn't a market right now for proceeding with the full bill unless some big changes are made."

While she didn't say the option was dead -- "Everything is on the table," she said -- she outlined two very different options for passing a bill.

"There's a recognition that there's a foundation in that bill that's important. So one way or another those areas of agreement that we have will have to be advanced, whether it's by passing the Senate bill with any changes that can be made, or just taking [pieces of it]," Pelosi said.

"We have to get a bill passed -- we know that. That's a predicate that we all subscribe to."

Fiore Cartoon: In Haiti, the Good Starts With You

Thu Jan. 21, 2010 2:26 PM EST

The Haiti earthquake led to some disturbing responses—like Pat Robertson's claim that it was God's punishment on the Haitians. But it also brought out the good in people who did their part to help.

Watch cartoonist Mark Fiore's rumination below:

Texas Dem Finds "The Real Killer"

| Thu Jan. 21, 2010 1:58 PM EST

Massachusetts Attorney General Martha Coakley ran a pretty lousy campaign in her race to fill Ted Kennedy's senate seat. But is she the worst Democratic candidate to run for a major office in 2010? Not even close. Meet Bill Dear, proud Democrat, private investigator, conspiracy theorist, and (very very long-shot) candidate for the Texas governor's mansion.

Dear's campaign bio reads like an elevator pitch for a new show on truTV. He notes that he has, on multiple occasions, been referred to as "the real James Bond;" he exhumed the body of Lee Harvey Oswald as part of an investigation into the JFK assassination (which he, of course, witnessed firsthand); and, most notably, he has written a book and produced a documentary in which he identifies by name the real killer of Nicole Brown Simpson and Ron Goldman. You can call off the search, OJ!

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Campaign Finance Refomers: What Now?

| Thu Jan. 21, 2010 1:54 PM EST

As of Thursday, ExxonMobil is allowed to run election-day phonebanks. The Supreme Court ruled, 5-4, that corporations should be free to make independent expenditures in political campaigns. The decision overturned most existing campaign finance law and dealt a severe blow to supporters of campaign finance restrictions. But it didn't take reformers by surprise. Groups like Common Cause, Public Campaign, and Change Congress have been anticipating this defeat for months. In a confidential internal memo obtained by Mother Jones last year, Common Cause and Public Campaign warned, "Without an aggressive media effort, reporters will likely call a bad decision in Citizens United another sign that campaign finance reform is a fool's errand." That effort continued with a massive press call midday Thursday, with the presidents of the top reform groups going on at length about their problems with the decision. "It is a disaster," said Nick Nyhart, the president of Public Campaign, told reporters. "It's an immoral decision that puts the Roberts court on the side of Wall Street and big money lobbyists." That was typical. 

So what's the reformers' plan? Last month, Mother Jones reported that disparate reform groups had been merging staff, budgets, and agendas to coordinate their efforts to deal with the fallout of the Supreme Court decision and to push for public financing of elections. On Thursday's press call, Bob Edgar, the president of Common Cause, confirmed that strategy. "For the past year we've moved towards having a specific campaign with a campaign structure," he said. "A whole host of groups have put together a common staff, a common budget, a common agenda to get the financial resources together and the staffing in place." Common Cause and Public Campaign, the two older, DC-based groups, combined their campaign finance reform teams late last year to focus their energy on pushing for publicly-funded elections. They'll be the good cops, playing the Washington "inside game," working with Capitol Hill allies like Rep. John Larson (D-Conn.) to sign up more support for reform. Change Congress, the newer organization founded by Larry Lessig, will play the bad cop, attacking members of Congress who don't support reform and accusing them of corruption. 

Stevens Accuses Supreme Court Conservatives of Judicial Activism

| Thu Jan. 21, 2010 12:30 PM EST

So where are all the cries of judicial activism from the right?

By ruling today that corporations and unions can independently spend as much money as they want to back or trash congressional and presidential candidates, the conservative Supreme Court justices are throwing out over a century of jurisprudence that backed the regulation of corporate involvement in elections. Yet will the right denounce the five-to-four decision as an act of judicial overreach? That's not likely. But Justice John Paul Stevens, in a stinging dissent written for the minority, argues that the right wing of the court has engaged in a brazen act of activism--and has done so to award corporations more legal rights than they have previously been afforded.

A few excerpts:

* Even more misguided is the notion that the Court must rewrite the law relating to campaign expenditures by for-profit corporations and unions to decide this case. 

* The conceit that corporations must be treated identically to natural persons in the political sphere is not only inaccurate but also inadequate to justify the Court’s disposition of this case.

* Although they make enormous contributions to our society, corporations are not actually members of it. They cannot vote or run for office. Because they may be managed and controlled by nonresidents, their interests may conflict in fundamental respects with the interests of eligible voters.

* The financial resources, legal structure,and instrumental orientation of corporations raise legitimate concerns about their role in the electoral process. Our lawmakers have a compelling constitutional basis, if not also a democratic duty, to take measures designed to guard against the potentially deleterious effects of corporate spending in local and national races.

* The majority’s approach to corporate electioneering marks a dramatic break from our past. Congress hasplaced special limitations on campaign spending by corporations ever since the passage of the Tillman Act in 1907....We have unanimously concluded [in 1982] that this “reflects a permissible assessment of the dangers posed by those entities to the electoral process"...and have accepted the “legislative judgment that the special characteristics of the corporate structure require particularly careful regulation...The Court today rejects a century of history when it treats the distinction between corporate and individual campaignspending as an invidious novelty born [in a 1990 opinion].

* The Court’s ruling threatens to undermine the integrity of elected institutions across the Nation. The path it has taken to reach its outcome will, I fear, do damage to this institution. 

With this dissent, Stevens is scoffing at Chief Justice John Roberts' self-proclaimed fancy for "judicial modesty" and waging battle on one of the major fronts in the court's history: how far should the justices go in equating corporations with citizens. You can read the decision here.

You can follow David Corn's postings and media appearances via Twitter.

 

 

Supreme Court Eviscerates Campaign Finance Restrictions

| Thu Jan. 21, 2010 12:17 PM EST

Just when liberals thought their week couldn't get any worse, the Supreme Court decided to gut campaign finance restrictions. The Court's 5-4 decision in Citizens United v. FEC., issued Thursday morning, opens the floodgates for unlimited corporate spending in elections. The ruling is just as bad for campaign finance reformers as they have long feared. Until Thursday, corporations and unions were prohibited from getting directly involved in elections. Now ExxonMobil can theoretically run ads urging voters to support Sarah Palin's 2012 presidential campaign, and the AFL-CIO can run ads urging people to re-elect Barack Obama. "It's like 100 years of precedent being overruled," CNN's senior legal analyst, Jeffrey Toobin, said on air shortly after the decision came out.

The decision follows the basic argument that has dogged most campaign finance laws that have faced court review: since longstanding court precedent says that corporations are legally people, deserving equal protection under the 14th Amendment, they must be accorded the right to free speech. The Court's conservatives also believe that spending money in elections is a fundamental free speech right; thus, the government cannot restrict corporate spending in elections.

In the first paragraph of his 90-page dissent (joined in part by Sonia Sotomayor, Ruth Bader Ginsburg, and Stephen Breyer), Justice John Paul Stevens accuses the conservative majority of going out of its way to "rewrite the law relating to campaign expenditures by for-profit corporations and unions." Stevens goes on to directly challenge "the conceit that corporations must be treated identically to natural persons in the political sphere," calling it "not only inaccurate but also inadequate to justify the Court’s disposition of this case."

Stevens' move to challenge the notion of corporate personhood—even indirectly—is radical. The entire edifice of American business law rests on the presumption that corporations deserve equal protection under the laws. But the majority's decision is also groundbreaking. While it follows the contours of previous decisions, it is a far cry from the "judicial modesty" that Chief Justice John Roberts promised when he first took his place on the Court. The liberal justices on the court would almost certainly have been happy to join in a narrow decision on just the issue at hand—whether Citizens United, a political action committee, could spend its funds to televise an anti-Hillary Clinton screed, "Hillary: The Movie," in the 30 days before last years' primary election. The conservatives decided not to go that route. As David points out, this means that Roberts and the conservatives can no longer avoid the label of "activist" judges. They've turned the political system upside-down.

Obama and Volcker: About Time

| Thu Jan. 21, 2010 7:34 AM EST

It took a year—of pathetic deference to the financial lobby, of siding with the Wall Street alums in his administration, of allowing special interests and their shills on the Hill to hollow out financial regulation legislation—but Obama's finally seen the light. In the latest Wall Street-Washington news, the president's aiming to hit banks where it hurts by clamping down on risky speculative trading, capping the size of major financial institutions, and stopping commercial banks from trading with their own cash. An encouraging sign, Obama's latest move is just as much Paul Volcker's, the former Fed chairman who until lately couldn't get any of his ideas heard in Washington and had criticized Obama's earlier proposals. Until recently, Volcker,  the chair of Obama's Economic Recovery Advisory Board, was widely seen as less influential than more pro-Wall Street administration types like Treasury Secretary Tim Geithner and Larry Summers, the president's chief economic adviser. But now Obama and Volcker appear to have teamed up, and while Wall Street will surely scream bloody murder here, I can't help but feel excited that maybe, just maybe, Obama intends to quit bowing to big finance and work toward serious, lasting, productive financial reform.

Here's why this announcement is so important. For starters, as Kevin has pointed out in his piece "Capital City" and in many blog posts, a lot of the fallout from the financial crisis (and others like it in the past, i.e., LTCM) came down to one word: leverage. Shops like Lehman Brothers were allowed to be ridiculously, insanely leveraged, their bets so far exceeding what they actually had on hand, that when a great deal of those bets failed the entire ship sank with it. That applied to a lot of institutions, some of whom would presumably be impacted by this plan, which, as it's laid out now, would limit that risk-taking—and thus prevent future Lehmans and other catastrophes that would ripple throughout the economy. 

The proposal also hits on one of Volcker's causes celebre: prohibiting what's called "proprietary trading," when commercial banks make bets with their own money from, say, deposits. Until 1999, the Glass-Steagall Act maintained a firewall between commercial and investment banking, but once the act was eliminated banks began to bet again with their own cash on things like mortgage-backed securities. This latest proposal would again tamp down on that practice, given the role it caused in the run-up to financial meltdown.

With this latest proposal coming on top of the president's support for a Consumer Financial Protection Agency and the bank tax, has the administration finally reversed course? Obama has done more to take on Wall Street in the past week than in the previous year. As Congress looks to take up financial regulation talks, are today's moves a harbinger of what's to come?