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Wonkbook: The problem with ‘gangs’

By Ezra Klein,

Tom Coburn at a news conference. (AP) Tom Coburn's "break" is bad news for the “Gang of Six.” Mike Crapo and Saxby Chambliss are both conservatives in good standing, but it was Coburn who really had the credibility to make something like this work, Coburn who felt secure enough to go toe-to-toe with Grover Norquist over taxes, Coburn who persuaded the press there was something worth covering here.

But perhaps we shouldn't be surprised. Gangs, groups and gaggles haven't had much success at bridging broad partisan gaps in recent years. The original Gang of Six, the one that Max Baucus and Chuck Grassley led in search of a health-care reform law acceptable to both sides, went down in flames. The Wyden-Bennett process, which had many more than six senators signed onto a bipartisan health-care reform law, dissolved without so much as a floor vote. The Lieberman-Graham-Kerry talks did not result in a cap-and-trade law. Success, rather, has run through more customary channels: the leadership of both parties gathering to hash out the December tax deal, or the relevant committee chairman writing the health-care law and passing it in a party-line vote.

Gangs of well-meaning, bipartisan-leaning leaders embody how we want Washington to work, and as such, they frequently receive glowing, excited coverage. But, at least lately, they don't seem to be how Washington actually works. The inspirational theory underlying most of these efforts -- that a few well-meaning individuals can overcome partisanship and interest-group pressure and, in doing, inspire their colleagues to slip free of the surly bonds of politics and do what's "right" -- tends to work in reverse, with the few well-meaning individuals succumbing to the realization that their plan can't pass, and they may not even be able to survive advocating it.

The proliferation of gangs and groups suggests that the normal order is so dispiriting and unpleasant that even those who're most intimately involved are searching for another way. But the fact that none of them have succeeded suggests they haven't found it yet. The Gang of Five is meeting today, and who knows, they might emerge with legislation yet. But it's often worth listening to Mitch McConnell, whose peculiar honesty and tight control over his members has made him one of Washington's more accurate legislative prognosticators. "With all due respect to the Gang of Six, or any other bipartisan discussions going on on this issue," he said last week, "the discussions that can lead to a result between now and August are the -- are the talks being led by Vice President Biden."

Five in the morning

1) The Gang of Six is now the Gang of Five, report Philip Rucker and Lori Montgomery: "Since January, six senators have engaged in difficult negotiations and made painful concessions in a politically dangerous quest for something that has long eluded Washington: a bipartisan compromise to control the nation’s mounting debt. By Tuesday evening, however, the 'Gang of Six' was on the verge of collapse. Sen. Tom Coburn (R-Okla.) withdrew from the bipartisan working group, saying the senators simply could not overcome the polarizing political pressure that each faces. The group’s two other Republicans said it would be hard to continue without Coburn. 'The debt is still $14 trillion. It’s got to be solved in a bipartisan way'” Sen. Saxby Chambliss (R-Ga.) told reporters Tuesday night."

2) Coburn quit over Medicare, reports Brian Beutler: "A source with knowledge of the negotiations says Coburn ultimately broke ranks after members of the group rejected his proposal to introduce a global cap on Medicare spending that would have cut $150 billion from current beneficiaries. 'The issue we have now is, over the last couple weeks Coburn has been slow walking this and it's become clear that he's not been negotiating in good faith,' the source said. 'He came yesterday with demands that we make immmedate and deep cuts to current Medicare beneficiaries.' Coburn did not attend the group's Tuesday afternoon meeting, and [spokesman John] Hart's statement suggests he won't make an appearance Wednesday either. Hart did not immediately respond to a request for comment on Coburn's Medicare proposal."

3) The US wants IMF head Dominique Strauss-Kahn out, reports Howard Schneider: "Treasury Secretary Timothy F. Geithner added what may be a decisive voice to the debate Tuesday when he said during a speech in New York that Strauss-Kahn’s arrest on sexual assault charges means he is 'obviously not in the position to run the IMF.' Geithner called for acting managing director John Lipsky, the agency’s No. 2, to be more formally recognized as the IMF’s interim head...In China, Brazil and Turkey, officials of the three large, fast-growing and influential emerging economies used Strauss-Kahn’s arrest to argue that his successor be chosen by merit and not geography, setting the tone for a potentially divisive battle over the IMF’s executive suite."

4) The ranks of "default deniers" are swelling, reports Carrie Budoff Brown: "They are the newest breed of government skeptics, the swelling ranks of Republicans who don’t believe the Obama administration when it says a failure to raise the debt limit will prove catastrophic...House Speaker John Boehner (R-Ohio) validated the default deniers Sunday, saying, 'I understand the doubts.' Jim Nussle, a budget director under former President George W. Bush, argued last week that 'no one’s going to default' if Congress misses the Aug. 2 deadline. And Alabama Sen. Jeff Sessions, the top Republican on the Budget Committee, accused the White House of scare tactics similar to those used by the previous administration to win quick approval of the 2008 bank bailout after the markets crashed."

5) A Senate filibuster against repealing oil subsidies succeeded, reports Felicia Sonmez: "A Democratic measure that would have repealed tax subsidies for the five biggest oil companies failed to clear the Senate on Tuesday, falling short of the 60-vote threshold needed to advance in a near-party-line vote. The Senate rejected S.940, or the 'Close Big Oil Tax Loopholes Act,' in a 52-to-48 vote. Three Democrats - Sens. Ben Nelson (Neb.), Mary Landrieu (La.) and Mark Begich (Alaska) - joined nearly all Republican in voting against the measure, while two Republicans - Sens. Susan Collins (Maine) and Olympia Snowe (Maine) - voted 'yes.'...Even as Democratic leaders had been strongly pushing the measure, it was expected that the bill would fall short."

Concert film interlude: Wilco plays "A Shot in the Arm" in Ashes of American Flags.

Got tips, additions, or comments? E-mail me.

Still to come: Tim Geithner wants a debt ceiling boost by July; the administration is speeding along Accountable Care Organizations; proposed GOP budget cuts would hit the poor hard; the oil subsidy bill that failed yesterday was unconstitutional; and a kitten gets a milk moustache.

Economy

Tim Geithner wants the debt ceiling raised by July at the latest, reports Damian Paletta: "Treasury Secretary Timothy Geithner said Tuesday he wanted a vote to raise the $14.294 trillion debt ceiling 'done and clean' by July, weeks before the government could potentially default on its debts on Aug. 2. Mr. Geithner also said Republican leaders have told him privately they won't 'monkey around' with the issue. The remarks came during a series of back-to-back appearances in New York where he offered an unusually candid take on everything from the political challenges facing Washington to his future in it. 'We're the United States of America,' Mr. Geithner said at his first stop, at the Harvard Club in New York, when asked about the possibility of whether the U.S. government would default on its debts. 'You've got to be kidding.'"

The GOP and the Chamber of Commerce aren't as far apart on the debt limit as it looks, reports Jonathan Allen: "It’s tempting to think that a Republican schism revealed itself when business leaders sent a pair of letters to Capitol Hill last week urging lawmakers to raise the $14.3 trillion statutory cap on the nation’s debt... But the divide isn’t nearly as deep as it might appear at first glance. Some Republicans on Capitol Hill said the letters are helpful -- not hurtful -- in their efforts to corral support for the debt-limit increase. Rather than simply repeating a call for more borrowing authority, the business groups added language about the need for cutting spending and bringing the budget closer to balance."

Manufacturing wages aren't what they used to be, reports Michael Fletcher: "The nation’s factories have added 250,000 jobs since the beginning of last year -- about 13 percent of what was lost during the recent recession -- marking the first sustained increase in manufacturing employment since 1997. But the new hiring also reflects another emerging reality of U.S. manufacturing: Many of the jobs don’t pay anything close to what they used to. Assembly-line workers who will be making the EdenPure products under the auspices of Suarez Corp. Industries will start at $7.50 an hour. That’s a far cry from the $20 an hour that most workers made with Hoover, which shifted its century-old production lines to Mexico and El Paso in 2007 after concluding that it was too expensive to make its products in the industrial Midwest."

House Republicans are worried about passing spending bills without Democratic help, reports Molly Hooper: "House Republican leaders face a daunting task in the weeks and months ahead: passing a dozen spending bills opposed by Democrats. Clearing the bills through the lower chamber will be a test for Speaker John Boehner (R-Ohio) and his whip team, which stumbled earlier this year...Republicans acknowledge they can’t count on Democrats to pass their spending bills, with the exception of the defense measure -- which usually attracts bipartisan support. The stakes are high for GOP leaders, who repeatedly mocked Democrats for failing to pass a budget last year. With 240 Republicans in the House, GOP leaders can afford only a small number of defections to pass the individual bills."

The media is giving more attention to the deficit than to unemployment, reports Clifford Marks: "Major U.S. newspapers have increasingly shifted their attention away from coverage of unemployment in recent months while greatly intensifying their focus on the deficit, a National Journal analysis shows...National Journal compiled counts of articles that mention one of the words in their headline or first sentences in the five largest newspapers in the country by print circulation -- a group that consists of The New York Times, The Wall Street Journal, the Los Angeles Times, USA Today, and The Washington Post... Mentions of unemployment have been dwindling since they spiked to 154 in the month ending August 15, 2010; over the month ending Sunday, there were 63."

Asking for bigger and bigger bailouts of Greece isn't going to work, writes Steven Pearlstein: "Stop demanding that European taxpayers finance what looks to them like bailouts of profligate neighbors, or the bailout of a currency most of them never wanted anyway, and ask them instead to help bail out their own banks that have too many Greek or Portuguese or Irish IOUs on their balance sheets. By recapitalizing their banks, European countries can target assistance to those parts of the financial system where the risk of contagion is greatest, with a good chance the money will eventually be repaid. And by making bondholders and other creditors take some losses, they can give the people of Greece, Ireland and Portugal a fighting chance to revive their economies and pay back most of what they owe."

Adorable animals consuming liquids adorably interlude: A kitten gets a milk moustache.

Health Care

The administration wants to speed along a new way of managing Medicare patients, reports Amy Goldstein: "The Obama administration is trying to hasten the spread of new arrangements to coordinate and pay for the health care of older Americans, even as major groups of hospitals and doctors are skeptical of the government’s plans. Administration health officials announced a program Tuesday under which medical teams and health systems could begin the arrangements, known as 'accountable care organizations,' for Medicare patients by the fall. The program is intended as a way to move forward quickly with a small group of ACOs within Medicare, while officials finish writing rules for a broader effort to foster these organizations."

Newt Gingrich is walking back his criticism of Ryancare, reports Kendra Marr: "Professing himself a 'big fan' of Rep. Paul Ryan, Newt Gingrich conceded Tuesday night that his criticism of the Republican budget leader's Medicare plan was a 'mistake.' 'I made a mistake,' Gingrich told Fox News host Greta Van Susteren, recounting his apology call to Ryan earlier in the day. 'The fact is that I have supported what Ryan’s trying to do on the budget,' he said. 'The budget vote is one that I am happy to say I would have voted for.'...His appearance capped a day of damage control, including a conference call with conservative bloggers and his apologetic call to Ryan."

The health insurance market is anything but normal, writes Jared Bernstein: "In competitive markets, sellers can’t typically set today’s prices based on where they expect demand to be in the future...The dynamic should lead you to be particularly skeptical about plans that depend on private insurers responding to market signals (are you listening, Rep Ryan?). Republicans go on about how once everyone’s out there on their own shopping for insurance in unregulated, private markets, competition will drive prices down. That’s how it works for bananas. It’s not the way it works for health insurance-folks are locked into plans through their jobs, there’s huge information disparities (their business model is to know who’s risky and avoid them), and most importantly, individuals have minuscule bargaining clout."

Domestic Policy

The GOP's proposed budget cuts would hit the poor the hardest, reports David Rogers: "After campaigning on the promise to roll back spending to Bush-era levels, House Republicans have overshot their mark and landed in the last years of the Clinton administration -- at least in the case of cuts from labor, health and education appropriations important to poor and working-class families. Indeed, a proposed $139.2 billion cap for the annual labor, health and education bill is about $19 billion less than the eight-year average for the same discretionary spending under former President George W. Bush -- when measured in current dollars...It underscores the often heavy concentration of cuts from programs most sensitive to low-income families."

Harry Reid wants a vote on appeals court nominee Goodwin Liu, report Abby Phillip and Meredith Shiner: "Senate Majority Leader Harry Reid (D-Nev.) on Tuesday moved to bring the judicial nomination of Goodwin Liu to the floor, setting up a potential Thursday vote on the controversial nominee. The action begins the nail-biting push for the 60 votes that will allow Liu’s long-standing nomination to move forward. Liu was first nominated to the 9th Circuit Court of Appeals more than a year ago, but his nomination stalled due to opposition by Republican senators...Some Republicans have criticized Liu for what they say is his support for an activist approach to the law and for writing judgments in favor of more socially liberal positions like same-sex marriage."

Lawmakers in both parties want an investigation into a HUD affordable housing program, reports Debbie Cenziper: "A bipartisan group of federal lawmakers is calling on Congress to look into the nation’s housing-construction program for the poor, citing years-long delays and other breakdowns that have thwarted the production of hundreds of affordable-housing projects. Senate Banking Chairman Tim Johnson (D-S.D.) and Sen. Richard C. Shelby (Ala.), the panel’s ranking Republican, said Monday that they will seek to investigate the Department of Housing and Urban Development’s HOME program, which delivers $2 billion a year to local housing agencies to build and renovate homes around the country."

The Postal Service isn't going to be able to pay promised retirement benefits, reports Ed O'Keefe: "The U.S. Postal Service is once again threatening to not pay roughly $5.4 billion in retiree health benefits this fall because it says it cannot afford to do so. 'This year I don’t have the cash, and I can’t make the payment,' Postmaster General Patrick R. Donahoe said in an interview Tuesday. 'And if I did make the payment, I wouldn’t have cash to [pay] anything else.' By law, the USPS must pay about $5.4 billion annually to prefund future retiree benefits. But Donahoe warned members of a Senate subcommittee on postal affairs Tuesday that he won’t be able to pay unless Congress acts before Sept. 30 to change the law."

Video-bombing interlude: The Russian kid in the background knows what he's doing.

Energy

Democrats' failed oil subsidy bill was unconstitutional, reports Brian Beutler: "Republicans may have a point that Democrats are playing politics with oil subsidies. To understand why, look no further than the fact that the bill Senate Majority Leader Harry Reid will bring to the floor for a vote Tuesday evening doesn't pass basic constitutional muster. 'The question is if the bill passes the Senate, it will run into a blue-slip problem,' Reid said at his weekly Capitol press conference. Blue slipping is the process the House uses to reject Senate bills that impact tax and spending. Reid joked, 'That's the least of my worries.'"

The White House has stopped short of a veto threat against a Senate GOP drilling bill, reports Ben Geman: "The White House continued a recent trend Tuesday by alleging that GOP-backed offshore drilling plans would undercut safety and environmental reforms while stopping short of issuing a veto threat. The White House issued a formal 'statement of administration policy' that takes issue with a Senate GOP bill that’s slated for a test vote Wednesday. It follows similar statements on GOP drilling plans that recently passed the House (see here and here). The Senate bill, which mirrors plans the House approved this month, sets deadlines for holding offshore lease sales and acting on industry drilling permit requests."

Senate Dems want an FTC investigation into gas price fixing, reports Peter Kasperowicz: "Four Senate Democrats this week asked the Federal Trade Commission (FTC) to investigate whether U.S. oil refineries are purposefully cutting back capacity levels in order to keep gasoline prices high. Sens. Claire McCaskill (D-Mo.), Charles Schumer (D-N.Y.), Dick Durbin (D-Ill.) and Patty Murray (D-Wash.) cited press reports that this may be happening and told FTC Chairman Jon Leibowitz that this would be a 'direct affront' to American consumers. At a time when major refiners and oil companies are making record profits and American families continue to struggle with gasoline at record prices, the idea that refiners may be manipulating the market to keep prices artificially high is offensive,' they wrote."

Jon Huntsman stands alone among GOP presidential candidates in saying climate change is real: http://bit.ly/jA5kUj

Closing credits: Wonkbook is compiled and produced with help from Dylan Matthews and Michelle Williams.

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