Wonkbook: Obama to push carbon price; Waxman to investigate BP; NRA gets a special deal
Barack Obama will address the nation tonight after spending the day in the Gulf. The big question: Will he push a carbon-pricing bill, or not? His pollster has been circulating a memo to lawmakers arguing that the public wants a comprehensive energy bill, but in a quiet admission of the issue's tough politics, the memo doesn't use the words "global warming" or "climate change."
Meanwhile, House energy committee chairman Henry Waxman is slamming BP for "shortcuts" taken on the oil rig that exploded and previewing an aggressive investigation, congressional Democrats have brokered a deal to exempt the NRA and other groups from new campaign disclosure rules, and the Wold Bank kicks off a two-day conference on the growing crisis in municipal finance.
Tuesday, huh? Well, welcome to Wonkbook.
Obama will try to reinvigorate a climate bill in his address tonight, reports Mike Allen: Obama plans to include a call for an energy bill in his Oval Office address about the Gulf on Tuesday night. And the Obama administration has told key senators that 'an energy deal must include some serious effort to price carbon as a way to slow climate change,' according to a Senate Democratic leadership aide."
And Obama's top pollster is circulating a memo to lawmakers arguing that a big energy bill makes good political sense. But the memo never mentions "global warming" or "climate change," so it's clear those word don't make good political sense. Read it: http:/
Henry Waxman and energy committee oversight chair Bart Stupak are alleging that BP took "shortcuts" on the exploded oil rig, report Steven Mufson and Anne Kornblut: "In one instance, four days before the April 20 explosion, Brett Cocales, one of BP's operations drilling engineers, sent an e-mail to a colleague noting that engineers had not taken all the usual steps to center the steel pipe in the drill hole, a standard procedure designed to ensure that the pipe would be properly cemented in place. '[W]ho cares, it's done, end of story, will probably be fine and we'll get a good cement job,' he wrote."
The campaign disclosure bill being considered in the House will exempt the NRA, reports John Bresnahan: "The proposal would exempt organizations that have more than 1 million members, have been in existence for more than 10 years, have members in all 50 states and raise 15 percent or less of their funds from corporations. Democrats say the new language would apply to only the NRA, since no other organization would qualify under these specific provisions. The NRA, with 4 million members, will not actively oppose the DISCLOSE Act, according to Democratic sources."
Kitsch cover interlude: The Pains of Being Pure at Heart and Surfer Blood cover Lit's "My Own Worst Enemy".
Table of Contents: BP has outlined its new plan to contain the oil leak (and other energy news); Moody's rates Greece's debt as junk (and other economic news); the National Labor Relations Board is looking into electronic voting (and other domestic policy news); and Blanche Lincoln's derivatives proposal is gaining steam as it's dialed back (and other FinReg news).
BP has outlined a plan to capture all currently leaking oil, report Susan Daker and James Herron: "In a letter sent Sunday to U.S. Coast Guard Rear Admiral James Watson, BP said it expects to have the capacity to capture between 40,000 and 53,000 barrels of oil a day by the end of June. That compares with 15,000 barrels a day now, out of a flow of 20,000 to 40,000 barrels scientists estimate are coming from the well."
Obama's BP escrow plan is designed to make sure BP keeps its word later on, writes Chris Good: "Obama wants to get the money up front to ensure BP doesn't hide behind the $75 million liability cap for oil-spill damages, instituted under the Oil Spill Pollution Act of 1990, a law written in response to the Exxon-Valdez spill. BP has said it will not hide behind this liability cap and that it will pay 'all legitimate claims,' but the cap could signifiy an implicit threat as BP doles out claim money--since BP will not be legally obligated to pay those claims, as the company itself deems what is 'legitimate.'"
Harry Reid is backing the BP escrow fund plan: http:/
The onshore cleanup effort in the Gulf is chaotic, reports Campbell Robertson: "From the beginning, the effort has been bedeviled by a lack of preparation, organization, urgency and clear lines of authority among federal, state and local officials, as well as BP. As a result, officials and experts say, the damage to the coastline and wildlife has been worse than it might have been if the response had been faster and orchestrated more effectively."
Spy testing interlude: The NSA explains how polygraphs work.
Moody's is now rating Greek debt as junk: http:/
A Fed study suggests we could have near-zero interest rates until 2012, reports Sewell Chan: "A new research paper from the Federal Reserve Bank of San Francisco suggests that if the Fed continues to follow the course of monetary policy it has pursued since the crisis, the fed funds rate won't lift off from near-zero until 2012."
David Brooks thinks that in 'the larger struggle,' American and BP are on the same team: "The larger conflict began with the end of the cold war. That ideological dispute settled the argument over whether capitalism was the best economic system. But it did not settle the argument over whether democratic capitalism was the best political-social-economic system. Instead, it left the world divided into two general camps."
Long-term unemployment patterns suggest which industries may not recover, write Mebere Shiferaw and John Robertson: "For instance, construction and related industries are deep in the continued job-loss quadrant. In contrast, the temporary help sector has behaved procyclically. Jobs in federal government and health care have continued to grow, with the former boosted by temporary hiring of census workers. Of the 79 industries examined, about a third of them have landed in a different quadrant compared with the 2001 recession."
Gerald Seib thinks Washington is finding religion on the deficit at exactly the wrong time: "Is this really the right time to make deficit-cutting the top priority, when the economic recovery looks more fragile than it did just a few weeks ago, when state governments laying off people might help kill off recovery in its cradle and when a little juice from Washington is what's needed to prevent that from happening?-- The political imperative of showing that he gets the gravity of the deficit is running smack into a short-term policy desire to keep priming the economic pump."
Sasha Reuther, of the United Auto Workers-leading Reuthers, explains how the union can recover: http:/
Daniel Gross argues that cutting spending now would be folly: "The debate fails to recognize the anti-stimulus provided by states and cities, which are prohibited from running deficits. The Center on Budget and Policy Priorities calculated that 33 states made tax changes in 2008 or '09 that would increase annual revenues by $31.7 billion. Meanwhile, state and local governments slashed 22,000 jobs in May. 'The actions that states are taking because of the recession and their balanced-budget requirements are slowing the economy,' said Nicholas Johnson, director of the state fiscal project at CBPP."
Lego soccer interlude: A brick-by-brick recreation of Saturday's US-England game.
The National Labor Relations Board is looking into electronic voting for unionization elections, which could help unions, reports Kris Maher: "Some attorneys are interpreting the request for information as a step toward Internet or telephone balloting which they argue could favor unions. Today unionization votes overseen by the NLRB at private-sector employers are typically cast in person via secret ballots on company property. 'There's nothing to stop people from saying 'Let's do our Internet voting or telephone voting together to show our solidarity'' which could lead to peer pressure, said Chuck Cohen, senior counsel at Morgan, Lewis & Bockius, and former Republican appointee to the NLRB during the Clinton administration."
House Ways and Means staff director Janice Mays may be the second most powerful woman on Capitol Hill: http:/
More and more college-educated workers are going into manual labor, reports Carol Morello "Apprentices start out getting paid half the scale for experienced workers, with raises every six months. Ultimately, many make as much or more as they would in jobs requiring a college degree. Licensed journeymen can expect to be paid $65,000 to $85,000 a year, depending on overtime."
Obama's auto industry advisor is leaving for academia: http:/
Historically black medical school graduates are the most likely to work for underserved communities, reports Darryl Fears "The study in the Annals of Internal Medicine ranked medical schools based on the communities where their graduates worked and whether those doctors practiced primary care. The Morehouse School of Medicine in Atlanta, Howard University College of Medicine in the District and Meharry Medical College in Nashville ranked as the top three, in that order. Vanderbilt University School of Medicine in Nashville finished at the bottom of the 141 ranked schools, and the Northwestern University-Feinberg School of Medicine was 139. The Johns Hopkins University School of Medicine in Baltimore was ranked 122."
Urban planning interlude: The world's coolest bridge.
Blanche Lincoln is gaining support for her derivatives proposal, reports Brady Dennis: "Two regional Fed presidents recently backed Lincoln's efforts, while Economic Recovery Advisory Board Chairman Paul A. Volcker has softened his earlier criticism that the provision was too sweeping. Sen. Christopher J. Dodd (D-Conn.), who quietly tried to forge a compromise on Lincoln's measure during the Senate debate, last week said that 'at this point, I'm in support of what she has in the bill.'"
But Lincoln is weakening the provision at the same time, reports Damian Paletta: "Ms. Lincoln's new proposal clarified that the legislation would allow banks to trade and deal derivatives through separately capitalized affiliates. Previously, it seemed possible the language of the provision would force banks to spin off their derivatives businesses entirely. The new proposal also would give large bank-holding companies up to two years to follow the new rules and shield most community banks from limits."
Daniel Indiviglio argues this doesn't capture the intent of the original legislation: http:/
Wall Street lobbyists have conceded defeat on the Volcker Rule, reports Edward Wyatt: "Bankers have all but given up on defeating one of the most contentious provisions in the financial regulation bill - one that would effectively bar federally insured banks from trading for their own accounts - and are now focusing on battles like heading off a prohibition on derivatives trading.¿But with the so-called Volcker Rule now likely to become law after appearing to be dead at earlier points in the legislative process, banks are battling hard to fend off further restrictions on their activities."
Goldman Sachs is not losing clients despite revelations about its business practices, writes Andrew Ross Sorkin: "'We trust them,' Jeffrey R. Immelt, the chief executive of General Electric, told an audience at the 92nd Street Y in New York last month. 'People need to tone down the rhetoric around financial services and stop the populism and be adults.'¿Thomas J. Pritzker, the chairman of Hyatt Hotels and a long-time Goldman client, says he's wise to Goldman's practices. 'I'm a big boy,' Mr. Pritzker told me. 'I understand that they are in many businesses. I go into it with my eyes wide open.' He added, 'I don't feel any outrage, just the opposite.'"
We need to nationalize Fannie and Freddie, writes Stephen Blumenthal: "We must accept the fact that keeping the mortgage market liquid is so important to our economy that it must be guaranteed by the government. There is no reason why government agencies and their employees cannot administer programs that provide guarantees of payment of principal and interest, and securitization of mortgages."
Closing credits: Wonkbook compiled with the help of Dylan Matthews and Mike Shepard.