The Washington Current

Inside Romney’s Tax Returns: A Reading Guide

2012-01-26T19:05:00.002-05:00

by Lena Groeger, ProPublica

In response to growing pressure from voters and competitors, Republican presidential candidate Mitt Romney released 550 pages of tax returns Tuesday, covering two years of income. As one of the richest men ever to run for President, Romney's filings are enormously complex, and the subject of close scrutiny. News organizations are making their way through the returns. Here's our guide to where to look to make sense of the numbers.

The Washington Post, one of the news outlets with early access to the returns, reports that Romney got most of his income -- $21.7 million in 2010 and $20.9 million in 2011 — from profits, dividends or interest from investments. As you can see in the Post's annotated guide, none of that money came from wages or salaries, which is the main source of income for most Americans. Because most of his earnings came from capital gains, Romney paid just under 14 percent of his income in taxes in 2010. In comparison, in 2010 Obama was taxed at 26.3 percent and Gingrich at 31.7 percent. Even these figures understate the difference: Romney paid Medicare taxes on only his speech fees, while most Americans pay the 1.45 percent Medicare levy on nearly all of their income. See more candidate comparisons in this New York Times chart, or this one from CNN.

The American Enterprise Institute blog notes that Romney actually pays a higher effective tax rate than 60 percent of Americans (a family making around $45,000 would have an effective tax rate of 7.4 percent). But as Reuters explains, 14 percent is less than half the top rate on ordinary wages, which can be taxed up to 35 percent. Romney paid or will pay a total of about $6.2 million in taxes on his income from 2010 and 2011. Over those two years, he and his wife Ann have given about the same amount in charitable donations, including $4.1 million to the Church of Jesus Christ of Latter-day Saints. The Salt Lake City Tribune notes that Romney is one of the Mormon Church's biggest benefactors, and pays about a tenth of his income in tithe.

The Times' Caucus blog is keeping a live blog of findings as reporters comb through the returns. Some of their latest discoveries:

Speaking fees: Last week Romney told a crowd in South Carolina: “I get speaker's fees from time to time, but not very much." Turns out his author/speaking fees amounted to precisely $528,871 in 2010, and $110,500 in 2011.
The top 0.006 percent: According to the IRS, anyone who makes more than $10 million would be in the top 0.006 percent of taxpayers (according to their latest numbers from 2009). With an income of $21 million in 2010, Romney would be even higher.
Mortgage? Like Gingrich, Romney doesn't seem to have a home mortgage, as neither took a deduction in 2010. Obama, on the other hand, took a home mortgage interest deduction of $49,945.

Romney's 2010 tax return indicated he had a "bank account, security account or other financial account" in Switzerland, but the account was closed in 2010, his aides told the Wall Street Journal. The return also reports financial accounts in Bermuda and the Cayman Islands.

As noted in Bloomberg Businessweek, the recent release is likely to spark renewed controversy over how the tax code treats the extremely wealthy. The phrase at the center of this debate is “carried interest.” Partners in private equity firms, hedge funds and real estate developments get most of their compensation through carried interest, and since those earnings don't count as ordinary income, they are taxed much less.

In a short primer on the subject, the Wall Street Journal describes it this way:

Put simply, carried interest is a share of a partnership's profits that is taxed as a capital gain as opposed to ordinary income. It is a good deal: The top rate on gains held longer than a year is 15%, so the tax on carried interest is usually less than half the top 35% rate on ordinary income. There aren't FICA or Medicare taxes, either.

Benjamin Ginsberg, the Romney campaign's chief counsel, disclosed to the New York Times that Romney earned $7.4 million in carried interest from private equity firm Bain Capital in 2010.

Obama has repeatedly called the tax code's treatment of carried interest a “loophole” that's “just not fair,” and Warren Buffett mentioned it earlier last year when he demanded that the government stop coddling the mega rich. New York Mayor and billionaire Mike Bloomberg told the Wall Street Journal that “If it were up to me, I would end the concept of carried interest.”

Yet James Stewart, a Pulitzer Prize winning reporter who writes a business column for the New York Times, doesn't see it that way. Last year he wrote that carried interest is “indistinguishable from nearly all other forms of compensation that are treated like capital gains, such as stock options, deferred stock grants for corporate executives and many forms of incentive compensation, which is widespread across many industries. Like all capital investments, carried interest entails risk, since there's no way of knowing what it will be worth until long after the labor is performed, often years later.”

In a political climate characterized in part by the Occupy movement and “99 Percent,” these concerns aren't likely to disappear any time soon. In fact, as Politico notes, the Romney tax returns are fodder for the White House, which tackled precisely this issue of economic fairness at Tuesday's State of the Union.

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Ad Buy Highlights Gulf Restoration Bill Support Before Florida Debate, Primary

2012-01-26T06:35:00.005-05:00

An environmental organization launched a two-day, $30,000 radio ad blitz in Florida Thursday to highlight congressional, editorial and voter support across the political spectrum for a multi-billion dollar Gulf Coast restoration bill funded by BP oil spill fines.

Environmental Defense Action Fund says that it timed the ad buy to Thursday's GOP presidential candidates debate in Jacksonville, and following primary election in the Sunshine State.

Last week, Reuters reported that BP is likely to agree next month to pay $20 billion to $25 billion to settle all charges around the unprecedented Gulf oil spill — including fines for violating the Clean Water Act (CWA) — before the scheduled start of legal hearings in New Orleans on February 27.

"Florida, the Gulf Coast states, and the nation's economy are still suffering from the BP oil disaster, so we wanted to highlight this vital issue before the nationally televised presidential debate tonight and the first Gulf state primary on Tuesday," says Elizabeth Thompson, director of congressional affairs & president of Environmental Defense Action Fund. "All candidates for public office need to know that newspapers and voters in Florida and the Gulf Coast across the political spectrum consider support for this Gulf restoration bill an important litmus test to determine which candidates they will support."

The bipartisan Gulf restoration bill in the Senate and House — the RESTORE the Gulf Coast States Act (S. 1400/H.R. 3096) — would dedicate the CWA fines for the Gulf oil spill to restoring the Gulf Coast ecosystem and economy.

The Senate Environment and Public Works Committee has approved the RESTORE Act. The bill is cosponsored by nine of the 10 Gulf Coast senators, including Florida Sens. Marco Rubio (R) and Bill Nelson (D). In addition, nine Florida newspapers have endorsed the RESTORE Act, including the Bradenton Herald, Ft. Myers News-Press, Gainesville Sun, Miami Herald, Palm Beach Post (twice), St. Petersburg Times, Tampa Bay Tribune (twice), The [Lakeland] Ledger and The Tallahassee Democrat.

The 60-second ads will air a total of 55 times Thursday and Friday on news-talk radio stations in Jacksonville (WOKV-690AM/106.5FM), Tallahassee (WFLA-100.7FM Tallahassee) and Tampa Bay (WFLA-970AM Tampa).

The ads cite a recent poll that shows more than 70 percent of Florida Republicans, tea party supporters, independents and Democrats are more likely to support candidates who support the RESTORE Act.

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Obama’s Unfulfilled State of the Union Goals

2012-01-25T19:21:00.002-05:00

by Cora Currier, ProPublica

President Barack Obama's previous State of the Union speeches have pushed passage of such hallmark initiatives as the stimulus bill, health-care reform, the drawdown of troops in Iraq and Afghanistan and repeal of the military's "don't ask, don't tell" policy on gays. But some big ideas from previous SOTU addresses have been abandoned.

The Washington Post's Glenn Kessler has done a line-by-line analysis of some of the specific promises made in the 2010 and 2011 addresses, and how they've held up. Here we track the evolution of a few of Obama's promises in the SOTU addresses — and why he's struggled to keep them.

Energy and Infrastructure

Obama's speeches have pushed investment in alternative energy technology and major green infrastructure projects as a linchpin of his overall economic recovery plan, but Republicans in Congress have stymied these ambitions. Obama's 2009 speech claimed the stimulus bill would double the U.S. supply of renewable energy in three years and vowed to invest $15 billion in research and development for alternative energy and fuel-efficient cars. In 2010, U.S. energy from renewables averaged around 8 percent, unchanged from 2009; an updated figure is not yet available.

In his 2010 speech, Obama appeared to acknowledge Republican interests, mentioning “tough choices” on new nuclear power plants and offshore oil and gas exploration. But that year's climate-change bill languished in the Senate over disagreements on carbon caps and new efficiency standards.

Obama's 2011 speech kept to the theme of technological advance under the rubric “Winning the Future.” He vowed that by 2035, 80 percent of the country's electricity would be from clean energy and again called for increased funding for research and development. The U.S. Chamber of Commerce bluntly called the 2035 goal “impossible.” Obama's plan to give 80 percent of Americans access to high-speed rail within 25 years has made essentially no progress. The one project that did begin — in California — since has stalled.

Obama's energy goals have run up against a Congress hostile to costly projects in general and particularly suspicious of environmental regulation. The bankruptcy of solar-panel maker Solyndra Inc., which had received a $535 million federal loan guarantee, furthered the case of critics who argued that spending on clean energy was wasteful.

Taxes

In every SOTU to date, Obama has called for a tax on the wealthiest 2 percent of Americans — in other words, an end to the George W. Bush tax cuts for those making more than $250,000 a year. Obama agreed to temporarily extend the Bush tax cuts in 2010 as part of a deal with Republicans that also extended jobless benefits. Last year, Obama and congressional Democrats abandoned plans for a millionaire's surtax in return for Republican backing to extend a payroll tax cut.

Then there is tax reform. Each year, Obama has called for a simplifying the individual tax code and for a lower corporate tax rate. Cutting the 35 percent corporate tax rate has support from some Democrats and Republicans as well as many corporations and business groups. But as Marian Wang explained last year, any effort to overhaul the tax code inevitably means opposition — from groups that benefit from loopholes and tax breaks that reformers hope to repeal.

Guantanamo

In his 2009 SOTU, Obama pronounced the closing of Guantanamo Bay a centerpiece of his foreign policy. “In words and deeds, we are showing the world that a new era of engagement has begun,” he said. As ProPublica's coverage has shown, the administration continued to make periodic calls for Guantanamo's closure but could not overcome opposition to it. In March 2011, the administration revised its stance on Guantanamo, allowing for military trials of prisoners there to resume instead of moving them to federal criminal courts.

The DREAM Act

In last year's SOTU, Obama spoke at length about the need for comprehensive immigration reform, and he expressed support for legislation to grant legal residency to some undocumented immigrants who were brought to the country illegally as children. The DREAM Act failed to pass Congress in 2010 or 2011. Without a new immigration policy, the administration changed enforcement strategy, and exercises “particular care” in deciding on deportations, especially in the cases of students and young people. According to The New York Times, this approach has been applied unevenly and has caused confusion among enforcers and immigrant families alike.

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Pollster: SOTU Provides 'Powerful Framework For Having an Election'

2012-01-25T05:11:00.005-05:00

President Obama's State of the Union address Tuesday night should "help him a lot" in his fight for re-election this year, according to longtime Democratic pollster Stan Greenberg, citing results of a focus group of swing voters held during the speech.

The themes the president laid out during his annual televised address to a joint session of Congress cut across party lines and provide a "powerful framework for having an election," Greenberg says in a briefing with reporters held after the president's speech.

Reaction from 50 swing voters in Denver, Colo., show that Obama's populist defense of the middle class and their priorities in his State of the Union scored with voters, according to Greenberg's polling organizations, Democracy Corps and Greenberg, Quinlan and Rosner.

The president generated strong responses on energy, education and foreign policy, but most important, he made impressive gains on a range of economic measures, the pollsters say in a memo released after the news briefing.

These swing voters, even the Republicans, responded enthusiastically to his call for a “"Buffet Rule"” that would require the wealthiest Americans to pay more taxes. As one participant put it, “"I agree with his tax reform -- the 1 percent should shoulder more of the burden than the other 99 percent. He [Obama] talked about being all for one, one for all -- that really resonated for me."

These reactions by voters make it very clear that defending further tax cuts for those at the top of the economic spectrum puts Republicans in Congress and on the presidential campaign trail well outside of the American mainstream, the pollsters say.

These voters overwhelmingly liked what they heard from Obama-- even those who voted against him in 2008 appreciated the address, the pollsters say. But they continued to show deep skepticism that the president would be able to translate these words into actions.

The more Democratic participants mostly blamed Republican obstructionism while the more Republican participants insisted that Obama might talk a good game, but his actions in office did not reflect the words in this speech. However, participants across the political spectrum all agreed that Washington is broken and that progress on the important issues would be difficult until Congress addresses the corrupting influence of lobbyists and special interests.

This was not the easiest audience for Obama; although slightly more participants voted for him than McCain in 2008, it was a significantly Republican-leaning group (44 percent Republican, 32 percent Democratic), the pollsters say.

Within the focus group, Obama's approval rating jumped 8 points, to 58 percent. Further, his personal standing jumped 16 points, to 66 percent favorable.

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Public Opinion Snapshot: Americans Believe Our Economic System Favors the Wealthy

2012-01-23T20:46:00.002-05:00

This article was published by the Center for American Progress.

By Ruy Teixeira

Conservatives treat any suggestion that our current economic system unfairly favors the wealthy as tantamount to calling for socialism. In doing so they should realize they’re attacking the opinions of most Americans who do, in fact, believe the system unfairly favors the wealthy. In a December poll, the Pew Research Center found that 61 percent of Americans believe this is the case compared to just 36 percent who disagree.

And in a just-released poll, ABC News/The Washington Post found that 55 percent of Americans believe unfairness in the economic system that favors the wealthy is the bigger problem in the country, compared to 35 percent who believe overregulation of the free market that interferes with growth and prosperity is the bigger problem.

Conservatives should be careful who they’re accusing of being socialists. Most Americans do believe the economic system is unfair and the wealthy are the benefactors of that unfairness. So far, all the bluster on conservatives’ part is doing little to change that view.

Ruy Teixeira is a Senior Fellow at the Center for American Progress. To learn more about his public opinion analysis, go to the Media and Progressive Values page and the Progressive Studies program page of our website.

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Romney's Charge That 'Any President' Would Have Killed bin Laden False, Former White House Adviser Says

2012-01-23T05:13:00.002-05:00

A former White House adviser during the Clinton administration is striking back at Republican presidential hopeful Mitt Romney's assertion that "any president would have done" the operation President Obama ordered last year which resulted in the death of terrorist mastermind Osama bin Laden.

The former Massachusetts governor last month argued: “With regards to Osama bin Laden, we're delighted that [Obama] gave the order to take out Osama bin Laden, any president would have done that. But this one did and that's a good thing.”

Obama last May ordered a strike by U.S. commandos on the compound in Pakistan where bin Laden had been living, which resulted in the death of the al Qaeda leader who had planned the Sept. 11, 2001, attacks.

Robert Weiner, a former Clinton White House spokesman and former senior congressional aide; and Richard Mann, senior analyst at Robert Weiner Associates, make a case that Romney's statement that "any president" would have given the order that launched the raid that killed bin Laden is false.

They contrast President George W. Bush's decision to farm out a raid on bin Laden's 2001 Tora Bora location at the time in Afghanistan to Afghan forces who failed in their mission, to Obama's U.S. solo action a decade later that succeeded when Obama did not reveal the strategy ahead of time.

Weiner and Mann, wrote an article featured as the lead front page piece in Sunday's Naples(Fla.) Daily News opinion section, "'ANY PRESIDENT' WOULD HAVE DONE THE SAME' AS OBAMA? Romney's Remark About Ordering Raid on bin Laden is Wrong: Ask Bush about Tora Bora."

Weiner and Mann document their claim with information including a 2009 Senate Foreign Relations Committee report, "TORA BORA REVISITED: HOW WE FAILED TO GET BIN LADEN."

In the article, Weiner and Mann say, "When placed in a similar situation with parallel choices, George W. Bush, Obama's predecessor, failed to succeed because he made the opposite decision. In December 2001, Bush had the chance to capture bin Laden in Tora Bora, Afghanistan, was faced with the choice of doing it ourselves or involving a foreign government, and blew it by asking the Afghanis to do it. Whether by ineptness or intent, the Afghani troops allowed bin Laden to escape."

Weiner and Mann show how Obama's approach was totally different. "When Obama was questioned as why he did not inform the Pakistanis in advance about Abbottabad, he said, 'I didn't tell most people here in the White House. I didn't tell my own family. It was that important for us to maintain operational security.' When asked during the 2006 presidential campaign debates what he would do with 'actionable intelligence', he said he would indeed have the United States 'act unilaterally' rather than in consort with foreign intelligence if necessary to capture bin Laden. That's precisely what he did."

The authors quote the 2009 Senate Foreign Relations Committee report: "The Committee says its review 'removes any lingering doubts and makes it clear that Osama bin Laden was within our grasp at Tora Bora.' The Committee Chair expressed the 'hope that we can learn from the mistakes of the past.' Obama did," say Weiner and Mann.

They conclude, "The debate moderators and news media as a whole have only allowed the Republicans to differentiate from each other and not from the President's successes when it comes to foreign policy. With the primary field coming to Florida for the Jan. 31 vote, it is time for the moderators to ask the Republicans if they have any real alternative that would have succeeded as Obama did in taking down Osama bin Laden, Anwar al-Awlaki, or Libya's Muammar Gaddafi or for that matter, on domestic policy, where Obama reversed the Bush bleeding of 750,000 jobs per month, rescued the auto industry and the nation's financial institutions, and put the country back to 22 straight months of increased jobs and improved GDP."

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Right Remains Split On Anti-Romney Candidate

2012-01-21T08:38:00.004-05:00

Heading into Saturday's Republican presidential primary in South Carolina, conservatives remains divided on who ought to be the alternative to presumed frontrunner Mitt Romney.

Although former House speaker Newt Gingrich appears to be surging ahead of Romney in the Palmetto State, a number of prominent activists on the right continue to push former Pennsylvania senator Rick Santorum as true conservative alternative to Romney, the former Massachusetts governor.

Conservatives have long been wary of Romney, who has become known for big flip-flops on abortion and other issues. Many have been seeking to deny Romney the 2012 nomination, but have failed to fall behind a single alternative candidate.

Talking Points Memo released a poll average which finds Gingrich at 35.7 percent, Romney at 26.4 percent, Santorum pulling just 13.9 percent, and Texas Rep. Ron Paul pulling up the rear at 12.8 percent.

The strength of Gingrich is also demonstrated by the fact that when he suspended his own White House campaign this week, Texas Gov. Rick Perry threw his support to Gingrich.

But despite Santorum polling at second-to-last, a number of big-name conservatives appear to be going to mat for him.

"Last week some 150 conservative leaders gathered at Nancy and Paul Pressler's ranch to discuss the Republican presidential campaign -- there was an overwhelming 75 percent consensus to support Rick Santorum for President," says Richard Viguerie, a pioneer of political direct mail and "one of the creators of the modern conservative movement," according to The Nation magazine. "The group of conservative leaders named in today's release includes Dr. James Dobson, Gary Bauer, Joseph Farah, Foster Friess, Elaine Donnelly and many others representing all four segments of the new conservative coalition who are coalescing behind Rick Santorum's candidacy."

Specifically, Viguerie calls Santorum the best candidate to bring together social conservatives, national defense conservatives, economic conservatives and tea party conservatives.

"Rick Santorum is the only reliable conservative left in the race," Viguerie says. "He has a long involvement in the conservative movement, and he has demonstrated his commitment to hiring conservatives on his Senate staff and in his campaign. On the issues of vital importance to conservatives, such as the right to life, the pro-family agenda, national security, and fighting the growth of government, he has walked with us even when the path was hard.

"If conservatives want a conservative, not just another establishment Republican, nominated in Tampa and elected in November it is time for us to start concentrating on consolidating that winning four-part coalition behind one candidate," Viguerie adds. "The candidate who best appeals to all four segments of the winning 2010 coalition, with the fewest negatives in November, is Rick Santorum."

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Years After Evidence of Fracking Contamination, EPA to Supply Drinking Water to Homes in Pa. Town

2012-01-20T17:06:00.002-05:00

by Abrahm Lustgarten, ProPublica

First, the earth around the rural town of Dimock, Pa., was cracked open as gas drillers used fracking to tap the vast energy supplies of the Marcellus Shale.

Then, in April 2009, residents there lost their access to fresh drinking water. Wells turned fetid. Some blew up. Tap water caught fire.

Now, nearly three years later — and after a string of lawsuits and state investigations has ushered Dimock to the forefront of the environmental debate over drilling but failed to resolve the water problem — the Environmental Protection Agency is stepping in to supply drinking water itself.

On Friday, the agency announced it would bring tanks of drinking water to four homes, including that of Julie Sautner, whom ProPublica first interviewed about her water problems in 2009.

“Data reviewed by EPA indicates that residents’ well water contains levels of contaminants that pose a health concern,” the agency said in a statement. Tests showed dangerous levels of arsenic, a carcinogen, as well as glycols and barium in at least four wells, and the EPA is apparently concerned that the contamination may be more widespread.

According to the statement, the EPA plans to test the water supplies in 60 additional homes for hazardous substances.

In 2009, Pennsylvania officials charged Cabot Oil & Gas, the company that drilled the wells in Dimock, with several violations it said had contributed to methane gas leaking out of the gas wells and into drinking water. For a time, Cabot supplied drinking water to a number of homes in the area but then stopped.

The EPA has waded into the Dimock issues slowly over the past few months, provoking a defensive stance from the state’s lead environmental regulator, who earlier this month called the EPA’s understanding of the Dimock situation “rudimentary.”

But the state has not undertaken the scope of water analysis the EPA now plans to do, and until the EPA stepped in Friday, Dimock residents had found little resolution.

Environmental groups are applauding the EPA’s move. "This finding confirms what Dimock residents have said for months, that the Pennsylvania Department of Environmental Protection should have never allowed Cabot to end deliveries of clean water," said Environmental Working Group senior counsel Dusty Horwitt.

But they also say the time has come for the EPA to address water contamination concerns in other communities across the country where residents say drilling has harmed their water.

In December, the EPA concluded that fracking was likely to blame for a similar rash of groundwater contamination in Pavillion, Wyo. The agency is conducting a multiyear national study of fracking’s effects on water supplies.

We have previously reported about water and drilling concerns in parts of western Wyoming, as well as central and southern Colorado, Texas, Ohio and elsewhere.

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Congressional Sponsors Angry After SOPA/PIPA Votes Delayed

2012-01-20T05:29:00.004-05:00

Wednesday's massive Internet protest against two controversial anti-piracy bills appeared to have some effect, as congressional leaders agreed to put off a vote on the legislation. However, it's obvious that the fight isn't over for opponents who contend the bills are so broadly written that they could lead to unchecked online censorship.

Although lawmakers bowed to the extraordinary pressure of Wednesday's protest -- in which many popular websites "went dark" in protest over the Stop Online Piracy Act (SOPA) and its Senate twin, the Protect IP Act (PIPA) -- it's clear they aren't happy about it.

Senate Majority Leader Harry Reid (D-Nev.) announced Friday that he would delay the upcoming vote on PIPA.

“In light of recent events, I have decided to postpone Tuesday’s vote on the PROTECT I.P. Act,” Reid says.

He made clear that he expects the controversy to be resolved, however, and that the bill would eventually move forward.

“There is no reason that the legitimate issues raised by many about this bill cannot be resolved,” Reid adds. “Counterfeiting and piracy cost the American economy billions of dollars and thousands of jobs each year, with the movie industry alone supporting over 2.2 million jobs. We must take action to stop these illegal practices. We live in a country where people rightfully expect to be fairly compensated for a day’s work, whether that person is a miner in the high desert of Nevada, an independent band in New York City, or a union worker on the back lots of a California movie studio.

“I admire the work that [Senate Judiciary Committee] Chairman [Patrick] Leahy has put into this bill,” Reid says. “I encourage him to continue engaging with all stakeholders to forge a balance between protecting Americans’ intellectual property, and maintaining openness and innovation on the internet. We made good progress through the discussions we’ve held in recent days, and I am optimistic that we can reach a compromise in the coming weeks.”

'Knee-Jerk Reaction'

Leahy, himself, took a more-defiant tone regarding the news of the vote delay, saying congressional opponents of PIPA were guilty of "a knee-jerk reaction."

“I understand and respect Majority Leader Reid’s decision to seek consent to vitiate cloture on the motion to proceed to the PROTECT IP Act,” the Vermont Democrat says. “But the day will come when the Senators who forced this move will look back and realize they made a knee-jerk reaction to a monumental problem. Somewhere in China today, in Russia today, and in many other countries that do not respect American intellectual property, criminals who do nothing but peddle in counterfeit products and stolen American content are smugly watching how the United States Senate decided it was not even worth debating how to stop the overseas criminals from draining our economy.”

Leahy's Republican House counterpart, Rep. Lamar Smith of Texas, was somewhat more conciliatory in announcing a delay in a vote on SOPA, saying that "I take seriously" the concerns of critics who worry that the Domain Name System (DNS) blocking provisions of SOPA, in particular, could allow the federal government unchecked authority to shut down entire websites.

“The Committee will continue work with both copyright owners and Internet companies to develop proposals that combat online piracy and protect America’s intellectual property,” Smith says. “We welcome input from all organizations and individuals who have an honest difference of opinion about how best to address this widespread problem. The Committee remains committed to finding a solution to the problem of online piracy that protects American intellectual property and innovation.”

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Deutsche Analyst Sounded Alarm When Asked to Alter Numbers

2012-01-19T17:13:00.000-05:00

by Carrick Mollenkamp, Special to ProPublica

At a time when mortgage-backed securities were imploding and customers were fleeing the market, a junior analyst at Deutsche Bank AG protested when he was asked to alter the numbers in a spreadsheet to make a Deutsche security look less risky to ratings agencies, according to a person with knowledge of the matter.

The analyst, this person said, was asked by a mid-level Deutsche executive in late 2007 to make it appear that the investment would produce more cash than the bank actually expected at certain time points.

The request came at a crucial moment. In the last months of 2007, investors had grown skittish about such investments amid signs that the housing bubble was deflating, if not bursting. Up and down Wall Street, banks were trying to persuade ratings agencies that large portions of their mortgage-backed securities merited the coveted AAA stamp, meaning that they posed negligible risks of default. The analyst was asked to alter the spreadsheets in order to get a better rating, the person said.

The analyst's protest prompted an internal investigation conducted by a law firm, according to five current and former Deutsche employees. The protest and probe have not been previously reported.

Much remains unclear about this incident. It could not be learned whether false information was actually provided to the ratings agencies, nor whether the internal investigation dismissed or substantiated the analyst's account.

Two Deutsche employees who worked on the same team as the analyst told ProPublica they knew of no wrongdoing, and Deutsche issued a strong denial. "Any suggestion that we misled ratings agencies is unfounded and categorically false," said a Deutsche spokesman, who declined to answer specific questions about the analyst's protest or the internal inquiry.

But four years later, the revelation that an analyst protested raises questions about how vigorously, if at all, the government is investigating Deutsche Bank and its practices leading up to the financial crisis. In any case, ProPublica has learned, neither the S.E.C. nor any other government regulator or law-enforcement agency has interviewed the analyst.

The SEC's director of enforcement is Robert Khuzami. Before joining the SEC in 2009, he had been Deutsche Bank's general counsel for the Americas since 2004. He worked as one of the bank's top lawyers during the time the analyst raised questions. Khuzami has said he would recuse himself from any actions regarding Deutsche.

Another key SEC official -- George Canellos, who oversees enforcement for the New York regional office -- used to be a corporate lawyer who defended Deutsche against M&T Bank Corp. M&T, which was suing Deutsche over a security similar to the one the analyst raised objections to, had sought to depose the analyst and obtain the results of Deutsche's internal inquiry, according to people familiar with the lawsuit.

In December, M&T settled with Deutsche for $55 million in cash, M&T said Tuesday in its fourth-quarter earnings statement.

An SEC spokesman said the agency doesn't discuss whether it is investigating a firm. In general, spokesman Kevin Callahan said, Khuzami doesn't work on matters related to Deutsche, and Canellos is recused with respect to any matters related to Deutsche Bank's CDO business.

"We have policies and procedures for all staff to even prevent even the appearance of a possible conflict of interest," Callahan said. "We have experienced and professional staff ... to follow the evidence no matter where it leads, how complicated the product or which firms are involved."

The analyst's protest sheds light on a little-understood function, called modeling, that was critical to many of the transactions that wreaked major damage during the financial crisis. Modelers created vast and intricate spreadsheets that estimated or "modeled" how the securities were likely to perform, including on payment schedules.

The Analyst

Through 2006 and into 2007, a part of Deutsche Bank known as the CDO Group was humming. CDOs, or collateralized debt obligations, were securities, underpinned by mortgages, that the bank sold to investors. Even as it hawked these CDOs, Deutsche Bank and some clients were often betting that they would fail, because the mortgages that backed them looked increasingly likely to default. In essence, the bank was selling to investors a product that the bank itself believed was composed of "crap," as one Deutsche executive famously put it.

During 2006 and '07 -- when CDO sales peaked -- Deutsche ranked fourth in issuing CDOs behind Citigroup Inc., J.P. Morgan Chase & Co. and Merrill Lynch & Co., according to a 2011 report on the financial crisis issued by the U.S. Senate Permanent Subcommittee on Investigations.

Inside Deutsche's CDO Group, pressure to complete and sell the deals was intense, according to the Senate investigation, court records and people familiar with the Deutsche team. Investors were beginning to balk at purchasing CDOs because of signs the housing market was weakening. Employees often worked until 1 a.m. before being driven home in company-supplied town cars.

Among the hardest workers was a team of financial modelers and analysts. But despite their long hours, they "needed more bodies to process the work that was coming through," said a person familiar with the situation. So, some of the work was farmed out to a relatively cheap but highly skilled source of labor: Deutsche's Global Markets Centre in Mumbai, India. There, workers proficient in mathematics helped assemble and input the data for key spreadsheets.

Workers in Mumbai eagerly wanted to join Deutsche's prestigious and lucrative desks in London or New York. Few got the chance. One employee who did was Ajit Jain.

Jain had studied at the Indian Institute of Technology in New Delhi and joined Deutsche in June 2006, according to employment records kept by the Financial Industry Regulatory Authority. He joined the New York office in September 2007, when the CDO Group was struggling to find investors.

Within a short time of his arrival, according to three people familiar with the matter, Jain raised questions about whether spreadsheets were being improperly altered. His complaints went to senior levels within Deutsche, including its legal and compliance departments, according to people familiar with the matter.

A Deutsche spokesman said Jain wasn't available for comment.

Those spreadsheets were often so large and complex they could take several minutes to open on a computer, according to a person familiar with them. The spreadsheets involved fiendishly complex arrays of inputs and sophisticated calculations, involving everything from the default rates of the mortgages that backed the CDO, to when borrowers would pay off their loans. But one purpose of the spreadsheets was simple: to estimate how much cash the CDOs would generate at certain time points.

One place those estimates went was to ratings agencies such as Moody's and Standard & Poor's.

The Quest for a AAA Rating

A CDO is divided into different slices, called tranches, depending on the risk and potential return. These tranches were rated by one of the ratings agencies. For a CDO to be sold, it was crucial that the largest tranche be rated AAA, indicating that this investment was low-risk because it was the last layer to take losses.

But there was a catch: The ratings agencies relied heavily on the banks themselves to estimate the payment schedule on the underlying assets of the CDO, according to a person familiar with the work done at the ratings agencies. It was an "honors" system, this person said, in which the ratings agencies "outsourced" to the banks the inputs for the spreadsheets.

Those spreadsheets are the essence of what are known as CDO models, because the spreadsheets provide a model of how the CDO is likely to perform.

Meanwhile, banks knew how to engineer the key elements of a CDO spreadsheet so that it would spit out cash flow and other outcomes that would meet the ratings agencies' off-the-shelf formulas, according to a former ratings analyst and a former CDO manager who worked with Deutsche. In other words, banks structuring the deals knew what outcomes were necessary to receive a AAA or AA rating, and they knew how to adjust the spreadsheets to produce these outcomes, these people said.

That's the same conclusion that John Griffin came to. A professor of finance at the University of Texas at Austin, he co-authored a 2011 paper on CDO modeling that said banks pushed increasingly for top-tier AAA ratings, and that ratings agencies succumbed to the pressure. This led to a "downward movement in standards over time," Griffin said in an interview.

"Cash flow modeling is more susceptible to influence from the investment bank," the paper said.

Griffin and his co-author, Dragon Yongjun Tang of the University of Hong Kong, wrote that former employees at two investment banks told them that banks had learned how to tailor CDO models to obtain good ratings.

That is very similar to what Jain told his bosses was happening at Deutsche. According to the person familiar with the matter, a mid-level Deutsche executive asked Jain to alter the spreadsheets by changing certain payment schedules to win a higher rating.

It is not known whether Deutsche submitted such modified spreadsheets to a ratings agency to receive better ratings. As best as could be determined, the specific CDO Jain complained about was not sold to investors. It is not known why.

The Internal Investigation

According to people with knowledge of the internal probe, the alarm Jain sounded went to senior levels inside the bank, including Deutsche's compliance and legal departments.

Soon, Deutsche called in the New York law firm Milbank, Tweed, Hadley & McCloy to conduct an investigation. The law firm interviewed employees on the CDO desk, according to people familiar with the situation.

Two employees on the desk, in interviews with ProPublica, said they knew of no improper modeling, and a third said he didn't know because he wasn't part of the modeling unit.

"I personally don't think there is anything interesting," said Konstantin Kulev, who worked as a modeler on the CDO team, according to people familiar with the situation and internal Deutsche documents. In an interview with ProPublica, Kulev declined to answer specific questions.

Milen Shikov, another senior modeler, said in an interview that he knew Jain "did raise some questions" about the CDOs. But Shikov said the matter was "resolved."

Shikov recalled that he was interviewed by a law firm -- he could not remember the firm's name -- for three hours. He said he gave the law firm's questioners an email exchange with a ratings agency that he said showed Deutsche had followed the ratings agency's guidelines for preparing cash flow estimates.

A Milbank, Tweed spokeswoman declined comment. A Deutsche spokesman declined to discuss the inquiry or release the law firm's findings, but he categorically denied the bank had misled any ratings agency.

Lawsuits and a Senate Investigation

It is not known whether the SEC is investigating Deutsche. The SEC has settled with other large banks, such as Citigroup Inc. and JP Morgan Chase & Co. Critics of the agency say its settlements have been too small and have allowed the banks to neither admit nor deny wrongdoing.

Last month, M&T settled its civil suit against Deutsche, ending the high-profile case that had been wending its way through a New York state court.

M&T had alleged that Deutsche improperly sold slices of a $1.1 billion CDO called Gemstone VII that lost more than 95 percent of their value within months. M&T, according to its complaint, bought two layers of Gemstone VII: a $42 million layer rated AAA and a $40 million layer rated AA. "The AAA ratings and AA ratings were major considerations in M&T's determination to invest in the Gemstone VII notes, because they indicated that the notes were safe, stable and nearly risk-free investments," M&T claimed.

The complaint does not mention how payment schedules were modeled. But M&T contended that Deutsche and the outside Gemstone VII manager "gave false information to Standard & Poor's and Moody's, the two leading credit ratings agencies, to induce them to rate the Gemstone VII CDO notes higher than the notes deserved so as to overstate their quality and safety."

Jain's objections did not concern Gemstone VII but a later, similar CDO, according to people familiar with the matter. As part of its investigation for the suit, M&T learned of Jain's protest and the internal Deutsche inquiry, according to the person familiar with the suit, and sought to depose Jain and obtain the inquiry report.

Judge John Michalek sealed the case in April, and now M&T has settled. So the suit has revealed very little new information about Deutsche's practices.

Deutsche declined to discuss the lawsuit. In court papers, Deutsche and its law firm, Milbank, Tweed, said M&T knew the risks of investing in securities underpinned by subprime loans. A Deutsche court filing in 2008 called M&T a "sophisticated participant" in mortgage securities and that the bank had "received detailed written disclosures about the risks of the investment." The document added that M&T "was counseled to perform its own due diligence" and was told "it could not rely" on Deutsche.

At least one lawsuit concerning Deutsche's CDOs is continuing. An affiliate of Germany's IKB Deutsche Industriebank AG sued Deutsche in October after the affiliate lost money investing in five Deutsche CDOs, according to court documents from that case. The IKB affiliate alleges that by late 2005, "Deutsche knew that the subprime market had increasingly come to resemble a house of cards teetering on the verge of collapse." The court filings do not mention the modeling Jain raised questions about.

A Deutsche spokesman declined comment. One of the most detailed public accounts of Deutsche's CDO business is the 646-page, 2011 report produced by the Senate investigation. But the report does not discuss how payment schedules for Deutsche CDOs were modeled, or the internal inquiry that stemmed from Jain's alarm.

The Senate report discusses Greg Lippmann, a Deutsche risk manager who oversaw the assets in Gemstone VII and other CDOs, and helped Deutsche earn $200 million by betting against some of the bank's mortgage-backed securities. Lippmann called assets that went into the CDO a "pig" and "crap," according to the Senate report.

Deutsche's views "were fully communicated to the market through research reports, industry events, trading desk commentary and press coverage," a bank spokeswoman said. "Despite the bearish views held by some, Deutsche Bank was long the housing market and endured significant losses."

Within a few months after Jain raised the alarm, many on Deutsche's CDO team had left the bank, according to FINRA records, and now work for boutique firms that specialize in buying distressed mortgage bonds -- exactly the kind of bonds that destroyed the CDOs they once created at Deutsche.

Jain remains at Deutsche.

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'Discreet' But Influential ALEC Blasts Obama's Keystone Denial

2012-01-19T05:18:00.004-05:00

Among those blasting President Obama's decision to deny permission to build a massive, transnational oil pipeline is a conservative organization which has been described as "discreet" but highly influential.

The American Legislative Exchange Council (ALEC) says it is disappointed in Obama's decision Wednesday to deny the application for the Keystone XL pipeline project. Obama says he denied the permit based on an unrealistically tight 60-day review period forced upon him last month by congressional Republicans.

The $7 billion pipeline has been highly controversial, both for its potential to damage water supply in Nebraska, as well as for apparent cozy corporate influence a key lobbyist has had with Secretary of State Hillary Clinton. The independent inspector general of the State Department had launched an investigation of the Obama administration's handling of the review of the pipeline application. The president had wanted to put off a decision until 2013.

Administration approval was required because the pipeline would have crossed the U.S. border.

In a statement, ALEC says Obama's position is "in direct opposition" to a resolution in support of the proposed 1,700-mile pipeline, which was approved earlier this month by ALEC's Legislative Board of Directors.

"ALEC members understand that the Keystone XL project is vital to this nation's energy security and is a much needed project that will bring jobs to the nation in a time of economic malaise," says Todd Wynn, director of the Energy, Environment and Agriculture Task Force at ALEC.

ALEC has, for decades, quietly produced business-friendly “model” legislation for state legislators. These “model” bills have formed the basis of hundreds of pieces of legislation each year, and often end up as state law.

ALEC and its members say that they favor “federalism and conservative public policy solutions.”
Among its backers, ALEC counts Koch Industries, owned by the wealthy Koch brothers who are conservative activists who fund a variety of right-wing groups and causes.

Media attention given to ALEC has grown steadily over the last year as its influence has grown since receptive Republicans grew in clout following the 2010 elections.

You can read a guide to ALEC and its legislative influence online here.

Although the administration left the door open for the company pitching the pipeline to re-apply for permission, ALEC complains "this will cause several more years of delay and subsequent continued economic stagnation, specifically at a time when Americans are in dire need of job creation."

ALEC cites high job-creation figures touted by many pipeline proponents, but which are higher than the number the pipeline company, TransCanada, had provided.

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Pipeline Rejected, Enviro Leader Suggests Reapplication Would Be Fruitless

2012-01-18T19:36:00.005-05:00

President Obama rejected an application to construct a controversial transnational pipeline Wednesday. Although the president left the door open for the company behind the project to reapply, a top leader in the environmental movement says such efforts also would go nowhere.

Obama blamed the tight deadline congressional Republicans forced upon him as the reason he denied permission to a Canadian firm to build a 1,700-mile oil pipeline from Canada to the Gulf Coast. With the State Department's inspector general investigating the administration's handling of the $7 billion Keystone XL pipeline thus far, Obama had wanted to delay a decision to 2013.

Republicans, however, forced the president's hand by imposing a quick 60-day decision last month as part of a compromise to continue middle class tax cuts and unemployment benefits.

"As the State Department made clear last month, the rushed and arbitrary deadline insisted on by Congressional Republicans prevented a full assessment of the pipeline’s impact, especially the health and safety of the American people, as well as our environment," Obama says in a statement. "As a result, the Secretary of State has recommended that the application be denied. And after reviewing the State Department’s report, I agree."

The proposed Keystone XL pipeline drew fierce opposition, both for its potential to damage water supply in Nebraska, as well as for an apparently cozy relationship between a corporate lobbyist for the project and Secretary of State Hillary Clinton.

(You can read an overall explanation of the Keystone XL project and its controversies online here.)

The leader of a key Washington environmental group which had fought to stop the pipeline cheered Obama's decision.

"The pipeline was rejected for all the right reasons. President Obama put the health and safety of the American people and our air, lands and water -- our national interest -- above the interests of the oil industry," says Frances Beinecke, president of the Natural Resources Defense Council (NRDC). "His decision represents a triumph of truth over Big Oil's bullying tactics and its disinformation campaign with wildly exaggerated jobs claims.

"Rather than bringing America energy security, the pipeline would have transported dirty Canadian tar sands oil through America's heartlands -- for export to other countries," she adds. "A decision on the pipeline proposal requires nothing less than a thorough and fair-minded analysis of its full effects on our environment and climate. But the schedule forced upon the Obama administration – a 60-day rush to judgment -- left insufficient time to conduct that assessment. Pipeline proponents preordained this outcome."

In his statement, Obama adds that his decision "is not a judgment on the merits of the pipeline, but the arbitrary nature of a deadline" imposed by Republicans.

That reportedly leaves TransCanada, the company behind the project, to reapply -- particularly if it adjusts its route around the sensitive areas of Nebraska.

However, NRDC's Beinecke expects such re-application to go nowhere, either.

“If TransCanada reapplies, Keystone XL will still face the same valid public concerns and fierce opposition as the first time. No matter how many times it is proposed, Keystone XL is not in the national interest,’’ she says.

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Internet Blackout 'Just The Beginning'

2012-01-18T05:04:00.004-05:00

While much of the Internet was "blacked out" Wednesday to voice opposition to a pair of bills which opponents say would amount to online censorship, activists promise the day of protest is "just the beginning" in the fight to defeat the controversial legislation.

Websites from Wikipedia to Google and others have joined in the protest, in which they have functionally or symbolically "gone dark" to raise awareness of the Stop Online Piracy Act (SOPA), and its Senate companion, the Protect IP Act (PIPA).

"The blacklist bills are dangerous: if made into law, they would hamper innovation, kill jobs, wreak havoc on Internet security, and undermine the free speech principles upon which our country was founded," says the blog at the Electronic Frontier Foundation (EFF), an organization opposed to the bills. "But deep-pocketed lobbyists are trying to ram this legislation through as quickly as possible, hoping elected officials will turn a blind eye to the widespread opposition to these bills. We can’t let that happen."

The chief bipartisan opponents of the bill, including Sen. Ron Wyden (D-Ore.) and Rep. Darrell Issa (R-Calif.), say they are committed to fighting online piracy. However, they and others contend the current legislation is overly broad and could allow the federal government to shut down entire websites without recourse.

Issa used the Twitter website Wednesday to announce that conservative Sen. Marco Rubio (R-Fla.) has dropped his support of PIPA. “Much more education for Members of Congress about the workings of the Internet is essential,” Issa reportedly says in a statement.

The widespread pressure against the bill appears to be working, as its chief sponsors in Congress say they will rewrite the legislation to remove the controversial Domain Name System (DNS) blocking provisions.

EFF says opponents also plan to urge lawmakers to defeat the legislation next week, once the Senate returns.

"We’re also gearing up for a day of action on January 23rd when the Senate will be back in session and getting ready to vote on the Protect-IP Act, SOPA’s sister bill," the EFF blog says. "We’re calling on digital activists and Internet users everywhere to call Senators on the 24th and voice their opposition to this censorship legislation. Despite the chorus of opposition from human rights advocates and the tech community, Senators are still trying to push through this dangerous censorship bill. We need all hands on deck to make sure that doesn’t happen."

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EPA Sees Risks to Water, Workers In New York Fracking Rules

2012-01-17T17:01:00.000-05:00

by Joaquin Sapien, ProPublica

New York's emerging plan to regulate natural gas drilling in the gas-rich Marcellus Shale needs to go further to safeguard drinking water, environmentally sensitive areas and gas industry workers, the U.S. Environmental Protection Agency has informed state officials.

The EPA's comments, in a series of letters to the state's Department of Environmental Conservation, are significant because they suggest the agency will be watching closely as states in the Northeast and Midwest embrace new drilling technologies to tap vast reserves of shale gas.

New York is in the forefront of the shale gas boom and has been working on regulations for more than three years. Judith Enck, the EPA regional administrator who issued the agency comments, noted that New York "will help set the pace for improved safeguards across the country."

The EPA's comments are among 20,000 the state has received on its proposed plan to regulate the environmental effects of drilling. Many of the EPA's comments focus on how the state DEC will handle the chemically tainted wastewater from the drilling process known as hydraulic fracturing, or fracking.

To free the gas trapped in the Marcellus and other shale formations, drillers pump millions of gallons of water mixed with sand and chemicals deep underground under pressure. The wastewater can get into drinking water by being disposed of at sewage treatment plants, the EPA wrote.

As ProPublica first reported in 2009, these plants don't typically have the equipment necessary to detect and treat the chemicals in drilling wastewater. Plant operators who accept drilling wastewater simply dilute it with regular sewage and then discharge it into water bodies. DEC wastewater samples had levels of radioactive elements thousands of times higher than drinking water limits, ProPublica reported.

In its comments, the EPA pointed out that New York's current permitting system for water treatment plants doesn't include limits on pollutants frequently contained in drilling wastewater, such as radionuclides, which can cause cancer at high levels.

The EPA said it needs to be more closely involved in analyzing and approving any treatment plant's application to accept drilling wastewater. And while the DEC's proposed rules suggest limits on radioactive elements such as radium, the EPA said it's not clear who would be "responsible for addressing the potential health and safety issues" related to radiation exposure.

The EPA also flagged health risks to workers close to wastewater and other potentially radioactive materials, like the large amounts of soil and mud unearthed by drilling. "At a minimum, the human health risks to the site workers from radon and its decay products should be assessed along with the associated treatment technologies such as aeration systems or holding for decay," the agency wrote.

The EPA raised concerns about the sheer amount of wastewater. To deal with the excess water, the DEC listed a number of out-of-state treatment plants as potential recipients, but the EPA warned that several of the plants probably don't have the capacity to handle more wastewater.

ProPublica reported that neighboring Pennsylvania became overwhelmed by drilling wastewater after the state embraced the industry. The Monongahela River, which provides drinking water to 350,000 people, became contaminated with drilling salts and minerals.

The EPA letters are the latest in a series of federal moves to tighten oversight of gas drilling. In December, the agency scientifically linked underground water pollution to hydraulic fracturing for the first time. Last August, the EPA announced that it would develop its own rules on wastewater disposal instead of leaving it up to states.

Industry and green groups have split over the DEC's proposed regulations, with drillers saying they are too restrictive and environmentalists contending they don't go far enough. Meantime, the EPA has launched a comprehensive review of the environmental impacts of hydrofracking.

In August, DEC Commissioner Joe Martens told ProPublica that he didn't think there would be much to learn from the EPA study and that the state was far ahead of the federal agency in its response to drilling.

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SOPA Opponents Make Progress Ahead Of Blackout

2012-01-17T05:26:00.005-05:00

Opponents of a bill targeting online piracy -- but which they say could have far-reaching unintended consequences for Internet censorship -- have made progress ahead of a planned web-based protest Wednesday.

Rep. Lamar Smith (R-Texas), chairman of the House Judiciary Committee, announced Friday that he would remove the controversial Domain Name System (DNS) blocking provision from the Stop Online Piracy Act (SOPA). Sen. Patrick Leahy (D-Vt.), likewise, says that he would also modify the DNS provisions in the Senate companion, Protect IP Act (PIPA).

The DNS provisions, opponents argue, could allow the federal government to shut down entire websites without recourse.

Further, a bipartisan group of senators, including Sen. Chuck Grassley (R-Iowa), also asked Senate Majority Leader Harry Reid(D-Nev.) to delay consideration of PIPA, citing concerns that substantive issues in the legislation have not been addressed.

“PIPA and SOPA would inflict severe harm to the Internet and undermine our national interest,” says Sen. Ron Wyden (D-Ore.), a chief opponent of the legislation. “The 11th-hour changes that the sponsors of the bills are proposing, and the letter of concern sent by Senator Grassley and others, are proof that both bills require further discussion and study before being considered by the House or the Senate. The DNS provisions in PIPA and SOPA are clearly unacceptable, but they are far from the only problems with the legislation.

“I agree with Senator Grassley and other senators that more time is needed to determine the best course of action that will narrowly target truly 'rogue' foreign websites without undermining speech and innovation,” Wyden adds.

Going Dark

Meanwhile, a number of popular websites, including Wikipedia and Reddit, plan to "go dark" on Wednesday to protest SOPA and PIPA.

Administors of Wikipedia, the well-known online encyclopedia, note that this will be the first time they have staged such a protest.

"In making this decision, Wikipedians will be criticized for seeming to abandon neutrality to take a political position. That’s a real, legitimate issue. We want people to trust Wikipedia, not worry that it is trying to propagandize them," says Sue Gardner, executive director of the Wikimedia Foundation.

"But although Wikipedia’s articles are neutral, its existence is not. As Wikimedia Foundation board member Kat Walsh wrote on one of our mailing lists recently, We depend on a legal infrastructure that makes it possible for us to operate. And we depend on a legal infrastructure that also allows other sites to host user-contributed material, both information and expression," Gardner adds. "For the most part, Wikimedia projects are organizing and summarizing and collecting the world’s knowledge. We’re putting it in context, and showing people how to make to sense of it.

"But that knowledge has to be published somewhere for anyone to find and use it. Where it can be censored without due process, it hurts the speaker, the public, and Wikimedia. Where you can only speak if you have sufficient resources to fight legal challenges, or if your views are pre-approved by someone who does, the same narrow set of ideas already popular will continue to be all anyone has meaningful access to," she says.

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Democrats Pull Ahead In Congressional Vote

2012-01-13T12:48:00.003-05:00

For the first time since the 2010 election, Democrats have taken the lead in the congressional vote and this poll shows that third-party defections on the presidential ballot could prove devastating for the Republicans, according to a new poll out Friday.

Moreover, the intensity gap has shifted in the Democrats' favor and Democrats have moved to parity on the economy after 28 months in deficit, the Democracy Corps poll finds.

More than half of all voters (53 percent) say that the more they watch the Republicans in Congress, the less they like what the Republicans have to offer; only 39 percent say they like it more -- a 14 point margin. The country is equally repelled by the Republican presidential contest (53 to 38 percent). The style of their politics and governance is driving away independents. And more than half of white non-college voters, who were key to Republicans' wins in 2010, do not like what the Republicans in Congress are offering -- a staggering result, the pollsters say.

Key findings:

For the first time in two years, Democrats are winning the congressional ballot (47 to 44 percent), the result of a major shift among independents. Democrats are now winning independents by 2 points -- a net 9-point shift among independents since October and a net 19-point shift since August. In June, Democrats were losing independent men by a margin of 29 points. That gap has closed to just one point. In 2010, Democrats lost seniors by a 23-point margin. That gap has closed to just 7 points.

John Boehner's favorability has fallen off significantly -- 44 percent now give the House Speaker a negative rating with three in 10 voters giving him a very negative rating (under 25 on our 100-point scale.)

Two-thirds of all voters now say they disapprove of this Republican Congress and its approval rating has hit a new low in our tracking -- 26 percent. The decline has come from a complete drop-off of those who "strongly approve" of this Republican Congress -- down to 8 percent, also the lowest in our tracking.

The Republicans have lost their advantage on the economy. The parties are now even on which party would do a better job on the economy, a net 7-point shift since October. While most improvements in this poll are due to Republicans faltering, here Democrats have gained 5 points on trust to handle the economy.

The Presidential Contest Full of Peril

The race for president remains very close, though showing the first signs of improvement for Barack Obama. With his approval rating at 44 percent and vote at 47 percent, you have a close contest. But Obama’s strong support is up 5 points, has more winnable voters than Romney and has made some important recent gains with key swing groups. Obama is now winning 40 percent of white-non college voters, his highest total among that group in a year. Among independents, Obama now trails by just 3 points—cutting his deficit in half since October.

Romney is not popular -– only 31 percent of all voters, and only 27 percent of independents, give him a warm, favorable rating. Obama, on the other hand, remains personally popular, with nearly 50 percent giving him a warm, favorable rating. As a result, Mitt Romney has not been able to energize voters. Voters, especially Republicans, are ready to bolt to independent candidates in large numbers — indeed, remarkable numbers.

This new poll shows that as a third-party candidate, Republican Ron Paul would take 18 percent of the vote in a match-up against Obama and Romney. Almost all of this comes at Romney’s expense. Nearly tied in a head-to-head matchup against the president, Romney’s vote plummets when Paul is added to the ballot, losing 12 points of his vote share.

The libertarian-leaning Texas congressman, Paul has neither announced any plans for a third-party campaign if he should lose the GOP nomination, but neither has he entirely closed the door on the idea.

The poll results are based on a national survey of 1,000 likely 2012 voters conducted January 8-11, by Greenberg Quinlan Rosner Research for Democracy Corps. Its overall margin of error is +/- 3.1 percentage points.

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New Bill Would Put Taxpayer-Funded Science Behind Pay Walls

2012-01-12T20:58:00.003-05:00

by Lena Groeger, ProPublica

Right now, if you want to read the published results of the biomedical research that your own tax dollars paid for, all you have to do is visit the digital archive of the National Institutes of Health. There you’ll find thousands of articles on the latest discoveries in medicine and disease, all free of charge.

A new bill in Congress wants to make you pay for that, thank you very much. The Research Works Act would prohibit the NIH from requiring scientists to submit their articles to the online database. Taxpayers would have to shell out $15 to $35 to get behind a publisher’s paid site to read the full research results. A Scientific American blog said it amounts to paying twice.

Two members of Congress — Reps. Darrell Issa, R-Calif., and Carolyn Maloney, D-N.Y. — introduced the bill. Rebecca Rosen of T he Atlantic finds it curious that Issa, a well-known champion of the open Internet whose own website displays the words “keep the web #OPEN,” would back a bill that appears to be the polar opposite of open access.

As Michael Eisen, a University of California, Berkeley, biologist and open access supporter, notes, Maloney's support seems no less mystifying since she represents “a liberal Democratic district in New York City that is home to many research institutions.”

Both Issa and Maloney have received campaign contributions from the Dutch company Elsevier, which calls itself the world’s leading publisher of scientific and medical information. According to MapLight, a website that tracks political cash, Elsevier and its senior executives last year made 31 contributions to House members totaling $29,500. Twelve contributions totaling $8,500 went to Maloney; Issa received two for a total of $2,000.

This isn’t the first effort by publishers to push Congress to roll back the NIH’s public access policy, which was enacted in 2008 and applauded by doctors, patients, librarians, teachers and students. Under the policy, all research funded by the NIH was required to be made freely available to the public one year after publication on PubMed Central. (The NIH also runs PubMed, a biomedical research database that includes articles that aren’t federally funded and cost money to access.)

In 2009, as Eisen notes, the Association of American Publishers backed the Fair Copyright in Research Works Act. That bill never left committee, but this new bill is essentially a shorter version of the same thing (and was similarly praised by the AAP for forbidding “federal agencies from unauthorized free public dissemination of journal articles”).

Two arguments in favor of the bill crop up regularly:

Publishers like Elsevier add value to every scientific journal article by overseeing the peer-review, editing and publishing process. Because of this contribution, they deserve exclusive rights to each article permanently, not merely one year after it has been published. Tom Reller, vice president for global corporate relations at Elsevier, comments here that Elsevier and other commercial and nonprofit publishers invest hundreds of millions of dollars each year in managing the publication of journal articles.”
Publishing companies need this money to keep the industry going. As the AAP states: “At a time when job retention, U.S. exports, scholarly excellence, scientific integrity and digital copyright protection are all priorities, the Research Works Act ensures the sustainability of this industry.”

In the recent commotion over the bill (here’s a roundup of recent posts), the academic community has replied to both of these claims.

In response to the added value argument, Kevin Smith, scholarly communications officer at Duke University, argues that publishers don’t actually produce or add much themselves. The work comes from academics and from the peer reviewers who volunteer their time to read and critique the work of their fellow academics. According to Eisen, although publishers might contribute a little something to the peer-review process (organization, supervision, etc.), this pales in comparison to the work done for free.

In response to the jobs and industry argument, Heather Morrison, a doctoral candidate at the Simon Fraser University School of Communication in Vancouver, B.C., points out that the top scientific, technical and medical publishers (Elsevier, Springer, Wiley, Informa) have seen profit margins of 30 percent to 35 percent in the last year. Elsevier, part of a global multibillion-dollar information conglomerate with offices in New York City, publishes about 1,800 journals and last year made a profit of $1.1 billion.

The Economist makes the same point: The industry seems to be doing just fine. Furthermore, there is evidence that more jobs would come from open policies than from closed ones, says Peter Suber, an open access advocate at Harvard University.

In his response to a recent White House request for information on public access in research, Harvard Provost Alan Garber calls the current situation an “access crisis.” He argues that public access is crucial to growing businesses, which need access to cutting-edge research to stimulate innovation, develop new products, improve existing ones, and create jobs.

“If the NIH policy is flawed,” writes Garber, “it is for allowing needlessly long delays before the public gains access to this body of publicly funded research, and for allowing needless restrictions on the public use and reuse of this research.”

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White House Sets Clear Contrast With Mitt Romney On Jobs

2012-01-12T05:49:00.004-05:00

An optimistic White House forum on job "insourcing" held Wednesday was clearly intended to separate President Obama from GOP presidential frontrunner Mitt Romney, who has come under withering attack in recent days for overseeing massive layoffs as the head of Bain Capital.

Surrounded by leaders in business, labor, and others, Obama touted progress made thus far on bringing jobs -- particularly in manufacturing -- back to the United States after years of corporations sending such positions off-shore in search of cheap labor.

At the forum, the administration cited optimistic statistics, such as 2 million private-sector jobs created last year alone -- "more than in any year since 2005," according to the White House. Specifically for manufacturing, the White House says that in the past two years, the economy has added 334,000 manufacturing jobs, "and that's the strongest two-year period of manufacturing growth since the 1990s."

“I’m incredibly optimistic about our prospects,” the president says of U.S. job-creation.

Obama encouraged executives to bring even more jobs back to the United States.

A business participant in the forum says that wages are rising quickly in China, a chief economic competitor.

“It’s a simple mathematical equation. It’s changing,” says Hal Sirkin, of the Boston Consulting Group. “And it will mean that it is a lot easier to retain jobs in the U.S. and it will be a lot easier to attract jobs back to the U.S. It’s not about the patriotism — although I know everybody on stage with me here is just as patriotic. But it is about the underlying economics. And the economics are favoring the U.S. at this point at this time. And by 2015, we expect to see the beginning — and these people are the absolute beginning — of the wave of ‘reshoring’ back to the U.S.”

While the president himself didn't mention his Republican rivals by name, participants in the forum friendly to the administration were more than happy to draw specific contrasts.

Leo Gerard, president of the United Steelworkers union, noted that his organization represents workers put out of their jobs after their companies were bought by Romney's Bain Capital.

The former Massachusetts governor has come under sharp criticism, not just by Democrats, but also other GOP presidential hopefuls, for his track record at Bain of buying companies only to let go their workers to improve the bottom line.

“From our point of view, this president from day one has tried to create jobs not cut jobs,” Gerard says.

After the forum, the White House released a fact sheet of what steps the Obama administration has taken thus far to encourage job growth and insourcing, as well as those actions yet to be done.

Unfortunately, many of those outstanding proposals -- from infrastructure improvements, to retaining teachers in the classroom -- already have been rejected by congressional Republicans, as they have blocked most provisions of Obama's American Jobs Act.

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Will the Supreme Court Strike Down Part of the Voting Rights Act?

2012-01-11T18:55:00.002-05:00

by Lois Beckett, ProPublica

As noted below, this guide has been updated. This guide was originally published on Jan. 9, 2012.

On Monday, the Supreme Court heard arguments in a Texas redistricting case that could have major implications for minority voters -- as well as determine which party is likely to control Congress after the 2012 elections.

Here's our guide to why the case matters, why it could pose a challenge to part of the Voting Rights Act, and what impact the Court's ruling could have on voters across the country.

Our update on Monday’s oral arguments is here.

How did this case end up in front of the Supreme Court?

At its most basic, the case is contesting which district maps Texas will use in the 2012 elections.

This seems like a dry question, but it's not. Thanks to population growth, Texas is gaining four seats in Congress, and how the district lines are drawn is likely to determine whether those additional seats will be won by Democrats or Republicans -- and how big an impact minority voters will have in deciding who the new representatives will be.

Because those four seats could help determine which party controls the House of Representatives, the Texas case is being closely watched across the country.

As it has done before, the Republican-dominated state legislature drew maps that heavily favor Republicans.

At least three of the four new congressional districts were drawn in a way that seemed likely to favor Anglo Republican candidates -- even though Latinos and African-Americans accounted for most of the state's population growth.

The legislature's maps immediately faced legal challenges from minority groups who argued that the lines were drawn to purposefully weaken the ballot power of Latino voters -- as well as from the Department of Justice, which argued that Texas' state house and congressional map plans are illegal because they diminish the ability of minority voters to elect the candidate of their choice.

Because the ongoing legal battle over the legislature's maps was interfering with the state's election schedule, the federal district court in San Antonio drew an alternate set of maps for the state to use.

These maps are seen as being more favorable to minority voters -- as well as much friendlier to Democrats.

Rather than use these court-drawn maps, the state of Texas appealed the case to the Supreme Court, arguing that the state court overstepped its bounds, and that, because of the time-crunch, the legislature's original plans should be used for the 2012 elections -- even though the federal government has yet to give the plans "preclearance."

The Problem with 'Preclearance'

This is where the case bumps up against the Voting Rights Act. Section 5 of the 1965 act requires that certain states with a history of racial discrimination -- including Texas -- get federal "preclearance," or approval, before implementing any laws that affect voting.

The Texas legislature's original plans haven't received preclearance yet -- and it's unlikely that they will before this year's elections.

While most states simply ask for preclearance from the Department of Justice, Texas has taken the less-common, more-expensive route of asking for approval from a panel of federal judges in Washington.

In denying summary judgment on the case, those judges have already concluded that "the State of Texas used an improper standard to determine which districts afford minority voters the ability to elect their preferred candidate of choice."

But the final ruling on preclearance is unlikely to come soon enough to get Texas' already delayed election season underway.

By asking the Supreme Court to use the state legislature's maps before they have received federal preclearance, Texas is essentially trying to perform a temporary end-run around the Voting Rights Act's "preclearance" requirement.

Texas is arguing that this move is perfectly legal, and would not affect the state's "undisputed obligation" to get federal preclearance before using its new maps "on a permanent basis."

Nina Perales, the director of litigation for the Mexican American Legal Defense and Education Fund, told the Washington Post that this move "flips Section 5 completely on its head," and argued the state was trying to squeeze in one more election cycle before having to reckon with the growing power of Latino voters.

Updated 1/10/2012: How is the Court likely to rule?

The fact that the Supreme Court decided to hear the case at all makes it seem unlikely that the justices will simply endorse the maps drawn by the federal court in San Antonio.

During oral arguments yesterday, several members of the Court suggested that the San Antonio court may have overstepped its bounds in the way it drew its interim maps -- particularly in its creation of new minority districts.

But the Court also made it fairly clear that it was not interested in overturning Section 5 of the Voting Rights Act -- at least, not at the moment.

“The constitutionality of the Voting Rights Act is not at issue here, right?” Chief Justice John Roberts, Jr. asked at one point.

Only Justice Antonin Scalia said that the San Antonio court should temporarily implement the Texas legislature's plan.

Justices Sonia Sotomayor and Elena Kagan emphasized that Section 5 banned the use of a plan that had not received federal approval, and Chief Justice Roberts seemed to agree, noting, “You cannot assume that the legislature’s plan should be treated as if it were precleared.”

But the consensus of the court seemed to be that it was just as problematic for the San Antonio court to assume that the legislature's map was an illegal gerrymander, and then redraw the map on the assumption that all of the minority groups concerns were legitimate.

Justice Samuel Alito suggested that the judicial branch had no business getting involved in making policy via map lines. "To say they are going to apply neutral districting principles is a subterfuge,” he said. “There is no such thing.”

Justice Alito suggested that the best solution might simply be to wait for the Washington, D.C., court to either grant or deny preclearance on the Texas legislative maps -- and to delay Texas' primary schedule again in the meantime.

Justice Kagan suggested a compromise plan, in which Texas’ court-drawn interim maps would more closely resemble the maps drawn by the legislature.

Attorneys for both sides said this plan would be preferable to simply implementing their opponents’ maps.

As the Washington Post’s Aaron Blake noted last month, such a compromise would still set a new precedent. “Currently, court-drawn maps are drawn with deference to the last constitutionally-approved map available (i.e. the existing map). Changing the standard would give state legislatures greater power over the final product, even in the event that their maps are invalidated,” he wrote.

Updated 1/10/12: Earlier Speculation on the Court and the Voting Rights Act

At minimum, the Supreme Court will have to rule on what maps Texas should use in its upcoming election.

As Lyle Denniston of SCOTUSblog put it, "The Court must either draft maps of its own, accept -- even grudgingly -- something that already exists, or find a streamlined way to get the District Court in San Antonio to craft a plan that minimally alters the state's maps."

But there's been speculation that the Court could also use the case as an opportunity to address the constitutionality of Section 5 of the Voting Rights Act, the part that requires certain states to obtain preclearance of plans that affect minority voters.

The Washington Post's Aaron Blake called this "the Nuclear Option." One of the key elements of preclearance is that it places the burden of proof on the state governments to prove that their plans are not discriminatory, rather than requiring minority groups to organize and pay for expensive legal challenges. By invalidating the Section 5 preclearance requirement, the Supreme Court "would allow these states greater freedom to draw their maps and increase the burden on minority groups and others who may fight the maps in court," Blake wrote.

The Supreme Court seemed to come close to overturning Section 5 two years ago, in another case from Texas. That decision made it clear that the Court had serious reservations about the limits the Voting Rights Act places on a state's sovereignty.

In that ruling, Chief Justice John Roberts Jr. wrote that "the Act now raises serious constitutional concerns," and that it "differentiates between the States in ways that may no longer be justified."

This time around, the conservative Cato Institute has submitted an amicus brief to the Texas case asking the Court to review the constitutionality of the Voting Rights Act, arguing that the statute "no longer serves its original purpose."

But some experts doubt that the Supreme Court will tackle Section 5's constitutionality in the Texas case.

Richard Pildes, a New York University law professor, told MSNBC, "The court recognizes that it must act more quickly than usual, given the time pressures involved with primary elections looming shortly down the road. For all those reasons, the court is likely to focus on the narrowest issues needed to resolve the particular legal issues presented."

Cato isn't alone in its opposition of the Voting Rights Act. Georgia Congressman Lynn Westmoreland, the Republicans' point man for congressional redistricting, has long opposed the act, calling it "outdated, unfair and unconstitutional." In a speech opposing the extension of the act in 2006, Westmoreland argued that Georgia's record of voter equality "can stand up to any other state in the nation" and that the Voting Rights Act's renewal would "keep my state in the penalty box for 25 more years based on the actions of people who are now dead."

But the Voting Rights Act also has strong, bipartisan support. President George W. Bush gave it high praise. Executives from Wal-Mart, AT&T, Pfizer, Coca-Cola, Disney and other large corporations wrote to Bush urging him to reauthorize the law and describing it as a cornerstone of American society. The Senate ultimately approved the 2006 extension of the act 98-0, and the House 390-33.

Although the Supreme Court may have decided not to tackle the constitutionality of the Voting Rights Act in the Texas case, it may soon have other opportunities to address the issue.

A case in which a county in Alabama is challenging the constitutionality of Section 5 of the Voting Rights Act is scheduled for oral arguments in the U.S. Court of Appeals on January 19.

The Department of Justice’s move to strike down South Carolina’s Voter ID law under Section 5 of the Voting Rights Act may also spark a case that could make its way to the Supreme Court.

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Industry Leans Hard For Keystone OK

2012-01-11T05:13:00.007-05:00

The petroleum industry is pushing hard on President Obama to give the green light to a controversial transnational pipeline from Canada to the Gulf Coast.

The head of the oil and gas industry's influential Washington lobby group, the American Petroleum Institute (API), is warning of political consequences should Obama deny approval for the 1,700-mile Keystone XL pipeline.

Congressional Republicans forced Obama to make a quick decision about the project as part of last month's short-term compromise over extensions of a middle-class tax cut and unemployment benefits. The legislation requires the administration to make a determination within 60 days.

Obama came under fire after he announced he would put off a decision until 2013 following news that the State Department's independent inspector general had launched an investigation into the process by which the $7 billion pipeline was being reviewed. Keystone XL needs State Department approval because it would cross the U.S. border. For approval, Obama must declare the pipeline to be in the "national interest."

Opponents object to the pipeline because potential damage it could do to water supply in Nebraska. Further, many -- including Sen. Bernie Sanders (I-Vt.) -- oppose the project because emails have shown a cozy relationship between corporate lobbyists for the pipeline and Secretary of State Hillary Clinton.

Opponents have staged a number of high-profile protests against Keystone XL outside of the White House.

(A more detailed explanation of the Keystone XL pipeline and its controversies can be found online here.)

Jack Gerard, president of API, appeared on the energy-industry webcast On Point Wednesday, trying to make the case that the pipeline would create needed American jobs.

"It's a real test on the part of the president. Is he for job creation or isn't he? So I think there is consequence if he makes the wrong choice," Gerard says. "I think he ought to do the right thing, approve the pipeline, let's put our people to work and let's make ourselves more energy self-sufficient."

Although Gerard says the pipeline could create 20,000 new jobs, opponents say the actual number would be far fewer. Even TransCanada, the company pushing for the pipeline, has said the jobs created would be no more than 7,000.

Gerard blames the discrepancy on "the assumptions and the multipliers" used to calculate job creation. He also claims that the environmental issues, including water quality in Nebraska, "have been dealt with."

The controversy over the pipeline has threatened to fracture the Democratic base. Environmentalists and activists against corporate influence vehemently oppose the project. However, labor unions -- traditionally staunch allies of Obama and Democrats -- appeared before a House Republican hearing to advocate for its approval based on the job-creation argument.

Gerard cited labor support as another reason for Obama to move forward.

"Organized labor already has a project labor agreement on this pipeline. The president's constituency is strongly supportive of building this pipeline," he says.

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Poll: While Half Disapprove Of Obama's Track Record, Most Like Him And Consider Him Very Smart

2012-01-10T17:13:00.005-05:00

While a new poll continues to find high disapproval levels for President Obama, most Americans like him personally and consider him to be very intelligent.

After three years in office, three in five Americans (62 percent) say they like Obama as a person, half (49 percent) like his political opinions, but only 43 percent like his track record as president. Half (50 percent) dislike it.

These are some of the results of a Harris poll of 2,237 adults surveyed online between Dec. 5 and 12, 2011.

This survey demonstrates both the challenges and opportunities Obama faces this year as he seeks a second term in the Oval Office.

As might be expected, Republicans and conservatives are more inclined to dislike most aspects pertaining to the president while Democrats and independents are more inclined to like them. Among independents, almost two-thirds (65 percent) say they like Barack Obama as a person, half (50 percent) like his political opinions, and 42 percent like his track record as president.

Looking at potential swing states for the upcoming general election, 62 percent of people in those states like the president as a person, 48 percent like his political opinions -- but just two in five (40 percent) like Obama's track record as president.

Regarding some other attributes of the president, three-quarters of Americans (73 percent) -- including over half of Republicans (56 percent) -- think that the president is a very intelligent person. Half of U.S. adults believe he inspires confidence personally (51 percent) and that his diverse background is an asset (49 percent).

Over half (56 percent), however, believe by focusing on healthcare reform in the early years of his term, he let the economy continue to struggle and half (49 percent) also believe positions he has taken as president have hurt the country. Half of Americans (49 percent) disagree that he has done little as President while 44 percent agree with that statement.

When asked about Obama's political stance, two in five Americans (42 percent) believe he is neither too liberal nor too conservative, 31 percent believe he is too liberal and 4 percent say he is too conservative. Looking at 2012 swing states, over one-third of people in those states (35 percent) believe Obama is too liberal.

If Obama is the Democratic nominee, which appears to be a given, two in five Americans (42 percent) would vote for him, 44 percent would not and 10 percent are not sure. These figures portend a potentially very close election in November.

Among independents, 46 percent say they would not vote for Obama while 39 percent would but among moderates, almost half (47 percent) would vote for him while 38 percent say they would not. Among the possible 2012 swing states, almost half (47 percent) say they will not vote for the president while 40 percent say they would.

Americans, especially those in the swing states, have been hurt by the economy and while it may be rebounding that needs to be perceived by voters, Harris says in an analysis accompanying the poll results. If it's not, the pollsters say, then the president has quite the uphill battle.

As its practice, Harris does not specify a margin of error for its polls, considering such terminology to be misleading.

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If Facebook Decided Election, Obama Would Cruise To Re-Election; Traffic Shows 3-Way Race

2012-01-10T05:23:00.004-05:00

If Facebook users decided the election, President Obama would be easily winning a second term in the White House. Meanwhile, heading into Tuesday's New Hampshire primary, traffic on the social media website appears to indicate the GOP nomination coming down to a three-man race among Mitt Romney, Ron Paul and Rick Santorum.

This is according to an analysis and research of Facebook usage from Dec. 10 through Jan. 8 by Socialbakers, a social-media analytics company.

Among candidates, the president has more than 24 million Facebook "fans," far more than that of his nearest rival, Mitt Romney, who has about 1.3 million. Texas Rep. Ron Paul has 672,483 fans; former House speaker Newt Gingrich has 223,558; Texas Gov. Rick Perry has nearly 180,000; former Pennsylvania senator Rick Santorum has fewer than 41,000; and former Utah governor Jon Huntsman has only 30,622.

But Santorum, whose campaign surged to a near-tie in Iowa caucuses, increased his fan base by 107 percent, followed by Paul at 14 percent and Romney at 7 percent. Santorum leads the top three candidates in number of posts shared – six times more than Paul and five times more than Romney.

For Santorum and Paul, posts that include a link have the most number of interactions ("likes" and comments), followed by posts with photos. For Romney, status updates have the most number of interactions, followed by posts with photos.

The top three candidates have shared an average of 19 videos on Facebook, with Santorum leading with 36 video posts.

Santorum averaged an 11 percent monthly increase in fans, followed by Paul at 8 percent and Romney at 3 percent. Santorum more than tripled his "People Talking About" metric between November and December, while Paul nearly doubled his "People Talking About" during the same period.

Most Engaging Posts

Socialbakers looked at which single Facebook post was most engaging for the candidates.

For President Obama, that came December 15, in the form of a new family portrait. This picture of the first family generated nearly 87,000 "Likes" and almost 16,000 comments.

Romney's most engaging post was published December 30: "This President spends a lot of time apologizing for America. He should be apologizing to America." It generated 26,004 "Likes" and 2,620 comments.

Paul's was his Christmas Day message: "Merry Christmas everyone. Wishing you the best with your family and loved ones today," which generated 22,406 "Likes" and 2,969 comments.

For Gingrich, it came December 2. It was a message which read: "Two hours after I'm sworn in as President, and by the time Obama lands in Chicago, I will have forty percent of Obama's government dismantled," and includes a video link to a Gingrich interview by Sean Hannity of Fox News.

Santorum's most engaging post was a December 13 reaction to the cancellation of a proposed GOP debate by Donald Trump. It generated just 822 "Likes" and 63 comments.

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Detention Protests Planned For 10th Anniversary of Guantanamo's Opening

2012-01-09T06:23:00.004-05:00

Amnesty International, the prominent human-rights organization, and other organizations are planning demonstrations around the world to mark the 10th anniversary of the arrival of the first detainees at Guantanamo Bay; activists will urge President Obama to keep his promise and close the U.S.-controlled detention facility.

The protests will take on an added dimension, organizers say, because of the National Defense Authorization Act (NDAA) now authorizes indefinite detention of U.S. citizens.

Obama pledged to close Guantanamo Bay -- originally opened by the Bush administration -- on his first day in office back in 2009, although he's not followed through on that first executive order. The facility has been a source of outrage among human-rights advocates for years due to the treatment of those held there.

There will be protest events in Paris, Toronto, London, Brussels and Berlin, among others. In Washington, there will be a marquee demonstration sponsored by Amnesty International USA, Center for Constitutional Rights, National Religious Campaign Against Torture and Witness Against Torture at Lafayette Park across from the White House, at noon on Wednesday.

Speakers at the rally include Col. Morris Davis, who previously served as the chief prosecutor for the office of military commissions at Guantanamo Bay, Talat Hamdani, mother of Salman Hamdani, an emergency medical technician who died in the September 11, 2001, and Ramzi Kassem, an attorney who represents detainees at Guantanamo Bay and elsewhere.

After the demonstration, participants will march down Pennsylvania Avenue and hold protests at the Department of Justice, the Capitol and the Supreme Court to dramatically demonstrate the chain of responsibility for a detention center that remains a symbol of torture and ill-treatment. Marchers will be led by 171 people in orange jumpsuits and black hoods, representing the men still detained at Guantanamo, a figure that may increase due to the detention provisions in the 2012 NDAA.

The NDAA now allows the U.S. military to capture and imprison civilians -- without any charge or trial -- including American citizens, anywhere in the world, including on U.S. soil.

Obama ultimately signed the bill into law on Dec. 31, despite earlier threatening to veto the legislation over concern regarding its indefinite-detention provisions.

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Hispanic Business Group Applauds Immigration Rule Change

2012-01-09T05:57:00.005-05:00

An Hispanic business group has thrown its support behind a proposed rule change by the Obama administration to reduce the time undocumented spouses and children are separated from relatives, who are American citizens, while they wait to earn legal status in the United States.

The rule change, announced by the U.S. Bureau of Citizenship and Immigration Services, would allow such spouses and children to remain in this country while they seek provisional waivers.

The change would help small family-owned businesses in the United States, according to Javier Palomarez, president and CEO of the United States Hispanic Chamber of Commerce (USHCC).

"From a business standpoint, the USHCC believes this proposed rule change will have a positive impact on American small business across the board," says Palomarez. "Countless small business owners in America depend on family members to help run profitable enterprises and their loved ones will now be able to continue working, while they complete the relevant immigration processes. Companies in the agricultural, transportation, hospitality, construction and manufacturing sectors will benefit, as their employees and their families can now go through the necessary, legal immigration procedures, but in an expedited fashion. This move will minimize the impact to the businesses where they work."

Nothing else would change in current policy, according to a Washington Post editorial, also in favor of the policy change.

"Once a waiver is granted, the immigrant would still be required to return to his home country to apply for a visa. But the shift would streamline the process and cut family separations to the days or weeks it takes to issue a visa, rather than the months required for a waiver application," the Post says.

Most of those affected by the policy are Mexicans, the Post adds.

The USHCC, which claims to represent the interests of nearly 3 million Hispanic-owned businesses in the United States, says that it will work with the administration to ensure that the proposed rule change gets implemented quickly.

"A major source of our country's strength comes from the diversity of thought and ingenuity of its immigrants. The United States has given birth to some of the most powerful companies in the world. We as Americans stand to benefit from this rule change," said USHCC Chairman Nina Vaca. "This is a positive change for America's small business community, which employs 64 percent of the workforce in our country. These small enterprises begin with the family unit and foster an entrepreneurial spirit and drive that is increasingly important in today's global market. Over a generation, they may become the next industry leader like Pfizer, Carnival or eBay - all of which were founded by immigrants and their families."

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Jobs Report Puts Pressure On GOP

2012-01-06T07:32:00.003-05:00

The federal government's report that the nation added 200,000 last month only puts fresh pressure on congressional Republicans to do more to help the struggling U.S. economy, and struggling jobless Americans in particular, according to many both in and out of the Obama administration.

The Labor Department released employment data Friday, which also found the national unemployment rate dropped to 8.5 percent, its lowest level in three years.

Despite the hope that the news represents, it also points out that more must be done, many say.

In all, employers created nearly 2 million private-sector jobs during 2011, according to Labor Secretary Hilda Solis.

"We've now created more than 3.2 million jobs over 22 consecutive months of private sector growth," she says. "But our hard-won progress cannot be compromised. Congress wisely extended Unemployment Insurance benefits and the payroll tax cut for two months, but if we're going to see our economy reach a self-sustaining path to durable and long-term economic growth, Congress will need to extend both programs for at least a full year.

"The American public has spoken loud and clear that it rejects the political gamesmanship that has created uncertainty for businesses around the country," Solis adds. "Congress should do the right thing and extend middle class tax relief and Unemployment Insurance benefits through 2012 to keep our economy on the path to full recovery."

Economists estimate that the nation will have to create more than 350,000 jobs per month -– for the next three years –- to get the unemployment rate down to 6 percent, according to Roger Hickey, co-director of the Campaign for America’s Future, a progressive Washington policy organization.

December’s figure of 200,000 jobs created means that the economy is barely growing at the rate needed to keep up with the growth of the labor force, Hickey says. The fact that the unemployment rate has declined to 8.5 percent has got to mean that many more people have become so discouraged that they stopped looking for work -- and thus are not counted as part of the labor force, he adds.

“The US needs 4 to 5 percent growth to replace the 5.2 million jobs lost since 2007 and to keep up with new people who need jobs. But most forecasters predict that our economy will be lucky to grow at 2 or 3 percent this year," Hickey says.

“Clearly, if we don’t want to stay stuck at high levels of unemployment –- and the growing inequality that comes with stagnant growth -- our government needs to take stronger steps to create jobs," he adds. "Instead, Republicans in the Congress are still threatening to remove stimulus from the economy by blocking extension of unemployment benefits and continuation of President Obama’s middle-class tax cuts. Today’s report will add public pressure on Republicans to renew those policies before the two-month temporary extension expires next month. But we have to do much more than continuing last year’s modest stimulus. Americans need to pressure their representatives to take advantage of record low interest rates to invest in public infrastructure, energy conservation and renewables, and education. These are investments our economy needs to make anyway –- and if we make them now, we can create enough jobs to escape today’s way-too-modest levels of growth and move our country to full employment.”

Curtailment of Unemployment Benefits

Chad Stone, chief economist at the Center for Budget and Policy Priorities, particularly worries about the future of unemployment benefits for the more than 13 million out-of-work Americans.
"The job market is nowhere near healthy enough yet to justify a sharp curtailment of federal emergency unemployment insurance (UI) benefits, which give critical support not only to the record numbers of long-term unemployed workers but to the economy as well," Stone says. "Yet that’s what will happen if, in the coming legislation to renew UI and the payroll tax cut for the rest of this year, policymakers include harmful provisions of the payroll-tax bill that the House passed last month."

Along with sharply curtailing the number of weeks of benefits, the House bill contained various “reforms,” some of which would undermine UI’s fundamental purpose since its establishment in the 1930s — to provide temporary financial assistance to workers who lose their jobs through no fault of their own while they search for a new job, Stone says. For example, the bill would deny UI benefits to all workers who lack a high school diploma or GED certificate and are not enrolled in classes to get one — even though employers paid UI taxes on these workers’ wages -- and those taxes effectively came out of these workers’ wages.

It also would allow states to drug-test all UI applicants and condition eligibility on the results — a standard not used for other federal programs ranging from farm price supports to tax subsidies.

"Such provisions should have no place in legislation to extend UI and the payroll tax cut through the end of 2012," Stone argues.

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The Poor Now Have A Lobbyist In Washington

2012-01-06T05:20:00.004-05:00

Washington's big-dollar lobbying industry has long been associated with peddling influence in government on behalf of the well-heeled and deep-pocketed corporations. Indeed, when the Occupy movement began to spread last fall, one of its first targets beyond Wall Street became K Street, the boulevard within the nation's capital historically home to some of the largest -- and most influential -- lobbyists working on behalf of big business.

However, low-income and middle class Americans now apparently have some lobbyists of their own.

Saying that with nearly one out of every two Americans living at or near the poverty level, there is an urgent need for a new voice in Washington to represent the interests of low income families and communities, a former West Virginia state legislator, and a former congressional staffer have teamed to establish Advocates for The Other America (AFTOA), a lobbying and consulting firm working to elevate issues of poverty, economic development, and empowerment before the Congress and the Obama administration.

Named for author Michael Harrington's book The Other America, which exposed the depth of poverty in the United States during the 1960s, AFTOA works to provide effective legislative solutions to the economic problems of low income Americans, according to an announcement of the organization's founding.

Despite the widespread increase in economic hardship, Congress and the administration continue to adopt fiscal policies that worsen the plight of low income families and communities, the founders of AFTOA say.

AFTOA says that its advocates will provide a new voice in Washington to push for policies that:

•Ensure that every child has the same opportunity to advance in society regardless of economic resources;
•Support economic policies that enable every American to have a job and to achieve economic self-sufficiency;
•Reduce income inequality in America and narrow what is now the largest gap between rich and poor of any industrialized society;
•Rebuild the middle class by creating a ladder of opportunity from poverty to success; and
•Ensure a continued role for the federal government in investing in programs that empower low income Americans to achieve economic security.

AFTOA says that it will work in the coming months to build and lead a working coalition of faith-based groups, labor unions, childcare advocates, the business community, and other private sector and nonprofit organizations to work for legislation and government policies that address poverty and the need for economic self-sufficiency.

The executive director of AFTOA is Arley Johnson, a former West Virginia state legislator and director of government relations for the National Association for State Community Services Programs (NASCSP). Its general counsel is Brad Penney, who worked in both the U.S. House and Senate for more than 12 years and served as director of government relations for the Alliance to Save Energy and as general counsel of NASCSP.

Last year, the Census Bureau reported that 46.2 million people were in poverty or one in six Americans. It was the fourth consecutive annual increase in the number of people in poverty.

AFTOA's staff clearly will have its work cut out for them, with coming legislative battles over a more long-term extension of the Obama administration's middle-class tax cut, as well as for unemployment benefits relied upon by more than 13 million jobless Americans.

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Smarter, Better, Leaner, Greener: 12 New Year’s Resolutions for the 112th Congress in 2012

2012-01-05T06:02:00.000-05:00

This article was published by the Center for American Progress.

By Sally Steenland

Many of us start off the new year with resolutions to break bad habits and pick up good ones. Although these lists are usually personal, there’s no reason an institution can’t come up with ways to do better in the coming year. In fact, there’s good reason to do so if, like the 112th Congress, your likeability ratings are hovering in single digits and you’re paralyzed by inaction.
So here are 12 proposed New Year’s resolutions for Congress in 2012.

1. Cut out junk food: Get rid of tax cuts for millionaires. The revenue from just one week of tax cuts for millionaires ($866 million) will more than pay for one year of nutrition assistance for women, infants, and children ($833 million).

2. Make new friends: Pass comprehensive immigration reform. Without a fair commonsense federal immigration law, states including Alabama and Arizona have passed harsh, inhumane laws that cast suspicion on neighbors, weaken the state’s economy, and spur homegrown talent to move away.

3. Get in shape: Strengthen our roads and bridges through smart infrastructure investments.The National Infrastructure Bank, part of President Barack Obama’s Rebuild America Jobs Act, will provide much-needed repairs to our nation’s dilapidated bridges, roads, rail systems, and transit networks.

4. Waste less: Streamline the U.S. military by cutting unnecessary costs, changing spending priorities, and achieving efficiencies through new technologies.

5. Learn new things: Support educational reform and retraining programs for workers by reforming the Elementary and Secondary Education Act, supporting Pell Grants, and job training.

6. Spend more time with family: Pass federal legislation supporting paid sick days and paid family leave. Workers should not have to choose between taking care of a sick child and keeping their job. Policies that help men and women balance work and family make them better workers and better parents.

7. Lower stress levels: Stop fighting the Affordable Care Act. The law expands coverage, keeps down costs, protects against abuses by insurance companies, and provides flexibility and choice.

8. Be less judgmental: Repeal the Defense of Marriage Act and pass the Employment Non-Discrimination Act. Discrimination against gay, lesbian, bisexual, and transgender Americans violates basic principles of fairness, equality, and equal protection under the law. It’s time to get on the right side of history and make it illegal to discriminate against anyone in the workplace and in their personal lives.

9. Rekindle an old flame: Support our troops during their service and when they come home. It takes more than waving flags to show the love for our servicemen and women. They need jobs, health care, housing, and educational opportunities when they return home.

10. Don’t be selfish: Support nutrition assistance programs such as the Supplemental Nutrition Assistance Program and unemployment benefits. Many American families are struggling in today’s economy. Protecting them from reckless budget cuts and providing a basic safety net is not only the right thing to do, but helps stimulate the economy.

11. Be greener: Cut dependence on fossil fuels, invest in renewable energy, and tackle climate change in a serious way. It’s time to stop oil addiction and climate-change denial, and grow our economy through a significant investment in green jobs.

12. Be better informed: Stay up-to-speed on current and stop conflating facts with fantasy. Unfortunately, many of our public debates live in a “fact-free zone” where outlandish claims take on the guise of truth. Think: death panels, birtherism, war on Christmas, and more. It’s impossible to solve the real problems facing our country until make-believe stops masquerading as factual reality.

All our good wishes to Congress for a productive and progressive new year!

Sally Steenland is Director of the Faith and Progressive Policy Initiative at American Progress.

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Thanks For Appointing Cordray, Now Fill NLRB Seats, Obama Told

2012-01-05T05:57:00.003-05:00

Although President Obama won applause for filling a top consumer-protection job despite partisan obstruction by the Senate, a well-known Washington progressive leader now wants the president to do likewise to fill problematic vacancies on the National Labor Relations Board (NLRB).

Obama went over the heads of senators Wednesday by appointing Richard Cordray as the director of the new Consumer Financial Protection Bureau (CFPB).

Created by the 2010 financial reform law, the CFPB is intended to shield consumers from the types of abuses which helped fuel the 2008 financial meltdown.

Appointing a director for CFPB was critical because, by law, the agency could not exercise its full authority without one.

Obama had nominated Cordray, a former Ohio state attorney general, to the post. But last month most Senate Republicans blocked the nomination. They did so not out of objection to Cordray, but due to opposition to the CFPB in general.

The president traveled to Ohio Wednesday to announce his decision to grant Cordray a recess appointment while senators were away. In doing so, Obama appeared to argue that the Senate Republican tactic of technically leaving the Senate in session through so-called pro forma sessions is nothing but an obstructionist sham.

Roger Hickey, co-director of the Campaign for America’s Future, a progressive policy shop in Washington, not only supports the move to appoint Cordray, but wants Obama to take a similar stand to fill vacancies on the NLRB, a quasi-judicial agency which aims to safeguard worker rights.

“We are very pleased that President Obama has used his Constitutional powers to appoint Richard Cordray to head the Consumer Finance Protection Bureau (CFPB). The Bureau needs to be up and running at full steam to protect consumers. Now the CFPB can be a watch dog on both banks and nonbanks and can work with its full powers to protect consumers,” Hickey says. “Republican lawmakers have tried to obstruct the Cordray appointment and the President’s nominations to other essential government bodies like the National Labor Relations Board -- agencies established by law but whose function they have been trying to hobble by refusing to allow a vote.”

The NLRB has been hobbled for several years due to a number of vacancies on the board. The NLRB has been operating with as few as two members of what is supposed to be a five-member board. The term of one NLRB board member expires each year. The lack of a clear quorum on the board has left its decisions in a legal limbo.

The NLRB currently is operating only with Chairman Mark Pearce and Republican member Brian Hayes. Obama's nominations of Terence Flynn, Sharon Block, and Richard Griffin are being held up in the Senate.

“Now the President should move quickly to use his recess appointment powers to appoint Members of the National Labor Relations Board (NPRB),” Hickey says. “The NLRB’s work is vital to protecting workers in this country. In an economy where more and more is expected from workers, the NLRB plays a vital role in worker protection. Activists from all over the country will be urging the President to appoint Members to the NLRB. Republicans and the business lobby have worked to hobble the NLRB, but the President must push back against the business lobby and stand up for workers.”

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Poll: Two in Five Americans Feel Less Secure Financially Compared to Last Year

2012-01-05T05:45:00.003-05:00

As the New Year dawns, it is a time when many look to the upcoming months full of optimism and hope. Unfortunately, when it comes to economic expectations this optimism may not be felt this year.

When asked to compare to last year, just 14 percent of Americans say they feel more secure about their financial situation while two in five (41 percent) say they feel less secure and 41 percent say they feel the same as last year. At the end of 2010, one in five U.S. adults (19 percent) said they felt more secure while 42 percent felt less secure; 36 percent felt the same as the previous year.

These are some of the results of a Harris poll of 2,237 adults surveyed online between Dec. 5 and 12, 2011.

As this is an election year, it's interesting to see how these feelings of security, or lack of it, break down by political party. Over half of Republicans (55 percent) say they feel less secure while just 7 percent say they feel more secure. Democrats are slightly more optimistic about what the current year will hold as one in five (20 percent) feel more secure and 28 percent feel less secure; half (49 percent) of Democrats feel the same as last year. For independents, over two in five (43 percent) feel less secure and 14 percent feel more secure.

A look at household finances

One in five Americans (19 percent) ended 2011 saying they expected their household's financial condition to be better in the next six months, half (53 percent) believe it will remain the same and 28 percent believe it will be worse. Last January, as 2011 dawned, over one-quarter (27 percent) believed their household's financial situation would be better in the coming six months, 27 percent believed it would be worse and under half (46 percent) believed it would be about the same.

Again, looking at political party, Republicans are more pessimistic than Democrats are about the coming six months. Just one in 10 Republicans (9 percent) believes their household's financial condition will be better compared to 30 percent of Democrats. Among independents, one-third (33 percent) believe the financial condition of their household will be worse in the next six months while 17 percent believe it will be better.

President Obama's handling of the economy

This year brings the presidential election and how people perceive President Obama's handling of the economy will have a large impact on how he does in November. As 2011 ended, one-quarter of Americans (25 percent) gave the president positive ratings on his handling of the economy while 75 percent gave him negative ratings. In November, 22 percent gave Obama positive marks while 78 percent gave him negative ones.

So What?

In 1992, as Bill Clinton was running for election, his campaign came up with the one mantra they would use throughout the general election: "It's the economy, stupid," Harris notes in an analysis accompanying the poll results. The thought was that people were hurting and as long as the campaign could show their candidate had answers to help, they would prevail. They were right and it just proved something long known in politics –- people vote with their wallets. This election will be more of the same and people are hurting. Obama needs to shore up his economic approval number to have a chance of prevailing in the general election, Harris says.

As is its practice, Harris does not disclose a "margin of error" for its polls, as the pollsters believe such terminology is misleading.

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Our Guide to the Best Coverage on Rick Santorum and His Record

2012-01-04T20:25:00.002-05:00

by Lena Groeger, ProPublica

This is the latest installment in a series of reading guides on 2012 presidential candidates. Here are the other guides.

The Basics

Rick Santorum's strong showing in the Iowa caucuses has vaulted him from obscurity to presidential contender. Just a few months ago, Santorum barely merited a mention as Republican voters fell in and out of love with Rick Perry, Herman Cain and New Gingrich.

So who is this darling of the evangelical movement?

Santorum, 53, is devout, hawkish, competitive and polarizing. Social conservatives praise him for his hardline positions. He opposes abortion, even in cases of rape and incest, believes gays should not be allowed to marry, and has said he would bomb Iran's nuclear sites if they are not opened to international inspection. Evangelicals applaud the prominence he gives to his faith. Liberals decry him for many of the same reasons.

Santorum's path along the campaign trail has been unusual by standards of modern politics. A recent New York Times profile of the candidate noted that his Iowa operation lacked a campaign headquarters, a speechwriter, advance team or advertising budget. The Times said Santorum set out to win the "old-fashioned way, through shoe-leather politicking." That involved lots of moving around. In the months leading up to the Iowa caucus, he visited all 99 counties in Iowa, often traveling by himself or with a single press aide.

The Background

If you want more than his official stance on the issues, you can take a look at NPR's recently listed the Five Things You May Not Know About Rick Santorum, including the fact that he jokes about spending his childhood in public housing, has spoken against programs that would pay for community service, and has two nieces.

A long Des Moines Register profile describes Santorum's journey from an ambitious young staffer and law student to 32-year-old U.S. representative of Pennsylvania and, four years later, senator. Here's a timeline span=""> of some key events in his life and more on his voting history. He helped author a landmark welfare reform act that gave states more responsibility for administering welfare and put time limits on how long a person could receive assistance. The bill passed with bipartisan support. Santorum was one of the Gang of Seven, a group of freshman Republicans that exposed several congressional scandals. He was elected to the Senate in 1994 and served two terms before losing by 18 points to Democrat Bob Casey in 2006. Since then he has worked as a lawyer and as a commentator on Fox News, a gig that ended when it became clear he was running for president.

Santorum has steadily gained popularity with the Christian conservative base. TIME magazine listed him as one of America's "25 Most Influential Evangelicals," and he recently won the endorsement of several prominent evangelical leaders. This New York Times story from 2005 is perhaps the deepest look at Santorum the Believer, whom a former aide once called "a Catholic missionary who happens to be in the Senate."

He is "at home on the far right of the Republican spectrum" as a profile in the Los Angeles Times puts it. Santorum fiercely opposes gay marriage, calling it a threat to the traditional values of this country. As a senator he fought for anti-abortion legislation -- which is why he calls himself the only Republican candidate with a track record on the issue.

Santorum is well known for his colorful and often controversial comments. The website Santorum Exposed keeps a list of his "greatest hits." Here are just a few:

"It's amazing that so many kids turn out to be fairly normal, considering the weird socialization they get in public schools." July, 2005.
"I think it has, as we've seen, very harmful long-term consequences for society. So birth control to me enables that and I don't think it's a healthy thing for our country." July, 2005.
"A lesbian woman came up to me and said, 'why are you denying me my right?' I said, 'well, because it's not a right.' It's a privilege that society recognizes because society sees intrinsic value to that relationship over any other relationship." May, 2011, explaining his view on gay adoption.

Santorum wrote in the National Review that two texts -- the Declaration of Independence and the Bible -- have shaped his guiding beliefs in "the dignity of every human being:" He and his wife Karen have seven children, all of whom they have home-schooled.

Santorum has called for public schools to teach students about the possibility that God, not evolution, was the moving force in the creation of the human species. In 2002 he wrote in the Washington Times that "intelligent design is a legitimate scientific theory that should be taught in science classes."

Controversies

In 2003 Santorum gave an interview to the Associated Press in which he equated homosexuality with bestiality and pedophilia. In protest, one gay activist spread a fake, vulgar definition for his last name all over Google. Santorum sued Google (he lost).

In one of the GOP debates this September, Santorum sparked another wave of criticism for his remarks on the military's policy of banning gay soldiers, known as "Don't Ask, Don't Tell." (He called the recent repeal of those rules "tragic"). He didn't speak up when audience members booed a gay soldier. The gay rights group GOProud demanded an apology. None was issued.

Following the Money

Santorum has raised far less than other Republican candidates, taking in only $1,286,975, according to his page on OpenSecrets.org. That's less than half as much as the next nearest candidate Newt Gingrich, who has raised about $2.9 million. Most contributions came from Santorum's home state of Pennsylvania, according to this New York Times interactive fundraising guide, which you can use to compare Santorum to other candidates.

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Top Dem Calls Mitt Romney's Meager Iowa Win 'An Indictment'

2012-01-04T19:17:00.004-05:00

Mitt Romney's paltry 8-vote win Tuesday in the Iowa caucuses is "an indictment" against the Republican presidential hopeful, a top Democratic operative says.

Romney barely squeaked past the late-surging Rick Santorum in the nation's first 2012 presidential race, reportedly the closest margin in Iowa history. He won with barely 25 percent of the vote.

The former Massachusetts governor also received fewer votes this year than he did back in his first White House run in 2008.

Following Romney's seeming Pyrrhic victory of sorts, the executive director of the Democratic Party tweeted: "despite millions of dollars spent in a state where he's been campaigning for 5 years, 76% of republicans dont want romney. an indictment."

Democrats also touted a variety of media which also panned Romney's bare win, from MSNBC's Chris Matthews, who declared, “Mitt Romney has a problem—three-quarters of the Republican Party gets a really good look at him and says no,” to Talking Points Memo, which says: "Despite Romney’s heavy spending in Iowa and the five years he’s had to make his case to conservative voters, about 3/4 of caucus-goers last night chose someone other than the man who’s been making the case he’s the most electable for five years. More embarrassing for Romney: President Obama—who faced no competition—actually pulled out a competitive number of votes last night. Democrats say 25,000 Iowans turned out to caucus for the president."

Romney and his rivals now move on to New Hampshire, where he is expected to due well next to his neighboring home state. However, after that the GOP pack moves on to more-competitive battlegrounds in South Carolina and Florida.

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In Iowa, Team Obama Looks Back -- And Forward

2012-01-03T21:26:00.003-05:00

Most of the interest in Iowa's presidential caucuses Tuesday will inevitably be on which Republican candidates come out on top, but that hasn't stopped President Obama's re-election campaign from also spending some time on the Hawkeye State's first-in-the-nation voting.

Obama's re-election campaign released a pair of online videos.

One features a much less gray-haired Obama from 2008. It was the then-senator's "closing argument" which Candidate Obama put out the night before the Iowa caucuses that year.

"It's pretty incredible to see candidate Obama talk about what President Obama ultimately did,"
Mitch Stewart, battleground states director for Obama for America, says in an email introducing the videos. "He makes four specific promises -- on reforming health care, making college more affordable, ending the war in Iraq, and putting us on the path to energy independence -- all of which today, four years later, are promises kept."

The second video released Tuesday by the Obama campaign is a video prepared by New York Times journalists.

While Obama may not be facing any real competition for re-nomination this year, the video tells the story of Obama activists who nonetheless have been drumming up support for the president, as sort of a dry run for November.

The Times goes so far as to call Obama "the most organized candidate in the state."

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Think Again: As We Leave Iraq, Remember How We Got In

2011-12-22T04:35:00.003-05:00

This article was published by the Center for American Progress.

By Eric Alterman

Two weeks ago in this space, I employed the 70th anniversary of the Japanese attack on Pearl Harbor to examine the unhappy precedent set by President Franklin D. Roosevelt in failing to level with the American people about the level of conflict between the United States and the Axis Powers that preceded the attack.

Using this analogy, and speaking of the manner in which President Lyndon B. Johnson deliberately deceived the nation about the imaginary second Gulf of Tonkin incident and thereby entangled the nation in the unwinnable Vietnam War, I noted Sen. J. William Fulbright later remarked that “FDR’s deviousness in a good cause made it much easier for [LBJ] to practice the same kind of deviousness in a bad cause.”

The consequences of President Johnson’s campaign of deliberate deception regarding Vietnam could hardly have been more catastrophic for the nation, the military, the president, his party, and the presidency itself. And while there is no reason to minimize either the level of lying or its consequences, one cannot be impressed by the refusal of President George W. Bush and Vice President Dick Cheney to learn from his mistake.

As we salute the final American soldiers leaving Iraq, we also remember the enormous costs paid not only by our soldiers and our nation but also denizens of the region, millions of whom were turned into refugees and injured, hundreds of thousands of whom were killed, and countless who were tortured or otherwise abused. But it behooves us to recall the underhanded manner in which President Bush and Vice President Cheney manipulated a quiescent press corps into making it appear as if an American invasion of a nation that had no intention of harming us (and next-to-no capacity to do so, regardless of intentions, as it turned out) was warranted.

At the same time, if we care about our nation’s ability to act as a democracy, we need to ask ourselves and our mainstream media hard questions about how it happened. To do so, I return to some of the research I undertook for When Presidents Lie (where specific citations for all of the quotes below can be found).

The almost ostentatious lack of concern for veracity was evident in almost every area of governance but was most prominent in the administration’s foreign policy pronouncements. Recall the famous (albeit anonymous) Bush press aide who, in response to a string of revelations of falsehoods relating to the president’s reasons for the invasion, replied, “The President of the United States is not a fact-checker.”

Yet the case President Bush made to convince the nation to embark on its first-ever “preventative” war was riddled with deception from start to finish. The examples of purposeful fraud in the Bush White House’s portrayal of the level of alleged threat to Americans’ safety and security posed by Iraq’s Saddam Hussein are so extensive that only a few examples can be offered here.

For instance, in September 2002, with British Prime Minister Tony Blair, President Bush claimed, “I would remind you that when the inspectors first went into Iraq and were denied—finally denied access, a report came out of the Atomic—the IAEA [International Atomic Energy Agency]—that they were six months away from developing a [nuclear] weapon. I don’t know what more evidence we need.” In fact, the estimate to which President Bush was referring was more than a decade old and was made before Iraq’s military capabilities were decimated in the Gulf War.

The president’s then-press secretary, Ari Fleischer, tried to claim in The Washington Post that “It was in fact the International Institute for Strategic Studies that issued the report concluding that Iraq could develop nuclear weapons in as few as six months.” But that report, which was unavailable at the time President Bush originally made his claim, did not support his statement either.

In a speech to the nation, President Bush also added, “Iraq could decide on any given day to provide a biological or chemical weapon to a terrorist group or individual terrorists,” an alliance that “could allow the Iraqi regime to attack America without leaving any fingerprints.” But this claim, too, was wholly unsupported and contradicted by CIA intelligence. The testimony, declassified after President Bush’s speech, rated the possibility as “low” that Hussein would initiate a chemical or biological weapons attack against the United States but might take the “extreme step” of assisting terrorists if provoked by a U.S. attack.

In the same speech President Bush warned the nation that Iraq possessed a growing fleet of unmanned aircraft that could be used “for missions targeting the United States.” But a CIA report suggested that the fleet was more of an “experiment” and “attempt” and labeled it a “serious threat to Iraq’s neighbors and to international military forces in the region.” The report said nothing about the fleet having sufficient range to threaten the United States.

President Bush’s repeated acts of dishonesty did not become widely known to the public until the famous controversy regarding “16 words” in his 2003 State of the Union address, referring to the story he told about Iraq’s alleged purchase of “yellow-cake” uranium from the African nation of Niger. But the focus on the mere “16 words” by the media was most notable for the successful spin that the White House managed to put on the story.

It wasn’t that these 16 words alone in the president’s State of the Union message were false. Much of what was presented as evidence for the American attack on Iraq dissipated upon receiving postwar scrutiny. Some of these examples derived, no doubt, from honest errors, relating to the difficulty of accurately assessing decidedly murky intelligence. But President Bush and his staff could easily have communicated the complexity of this judgment to the country had honesty been among their primary concerns.

In fact, they purposely argued on exactly the opposite: certainty of knowledge where none was possible. The president and his advisers were virtually unanimous in insisting that the threat facing the United States from Saddam Hussein and his alleged weapons of mass destruction was all but inarguable. Just a few examples suffice:

“Intelligence gathered by this and other governments leaves no doubt that the Iraq regime continues to possess and conceal some of the most lethal weapons ever devised.” — President George W. Bush, address to the nation, March 17, 2003.
“Simply stated, there is no doubt that Saddam Hussein now has weapons of mass destruction.” — Vice President Dick Cheney, speech to Veterans of Foreign Wars National Convention, August 26, 2002.
“We know they have weapons of mass destruction. … There isn’t any debate about it. [It is] beyond anyone’s imagination that U.N. inspectors would fail to find such weapons if they were given the opportunity.” — Secretary of Defense Donald Rumsfeld, September 2002.
“I’m absolutely sure that there are weapons of mass destruction there, and the evidence will be forthcoming.” — Secretary of State Colin Powell, remarks to reporters, May 4, 2003.
“We do know, with absolute certainty, that he is using his procurement system to acquire the equipment he needs in order to enrich uranium to build a nuclear weapon.” — Vice President Dick Cheney, NBC’s “Meet the Press,” September 6, 2002.

These statements are all demonstrably false, as the president’s own weapons inspections team judged them to be. While many in and out of government shared the misperception that Iraq might be in possession of such weaponry, only the Bush administration—supported by the Blair government in Britain—insisted that there could be no possible room for disagreement in assessing the conflicting shards of evidence. Indeed, a number of experts within the U.S. government itself were fully aware of how sketchy and incomplete were the government sources about Iraq’s WMD program, but these people were either ignored or purposely discredited.

For instance, a secret September 2002 report by the Pentagon’s Defense Intelligence Agency informed Defense Secretary Donald Rumsfeld, “There is no reliable information on whether Iraq is producing and stockpiling chemical weapons, or whether Iraq has—or will—establish its chemical warfare agent production facilities,” according to U.S. officials interviewed by the Los Angeles Times.

Also, according to Patrick Lang, former head of human intelligence at the CIA, when Bruce Hardcastle, a defense intelligence officer for the Middle East, South Asia, and counterterrorism, explained to Bush officials that they were misreading the evidence, the Bush administration not only removed Hardcastle from his post:

They did away with his job. They wanted just liaison officers who were junior. They didn’t want a senior intelligence person who argued with them. Hardcastle said, ‘I couldn’t deal with these people.’ They are such ideologues that they knew what the outcome should be and when they didn’t get it from intelligence people they thought they were stupid. They start with an almost pseudo-religious faith. They wanted the intelligence agencies to produce material to show a threat, particularly an imminent threat. Then they worked back to prove their case. It was the opposite of what the process should have been like, that the evidence should prove the case.

Greg Thielman, the former head of the Department of State’s Bureau of Intelligence and Research, likewise observed, “What everyone in the intelligence community knew was that the White House couldn’t care less about any kind of information that there were no WMDs or that the U.N. inspectors were very effective. Everyone knew the White House was deaf to that input. It was worse than pressure; they didn’t care.”

Despite being disproven by its own experts, the Bush administration attempted to maintain the fiction that the president’s prewar arguments and warnings had been borne out with false claims of imaginary discoveries. When asked in the summer of 2003, “Where are the weapons of mass destruction?”, President Bush replied, “We found them.” Vice President Cheney, too, claimed months later, “Conclusive evidence now demonstrates that Saddam Hussein did in fact have weapons of mass destruction.”

Finally, when pressed by ABC News’s Diane Sawyer to address the disjunction between his prewar claims and his postwar discoveries, President Bush laughed off the reporter’s distinction between desire and capability. “What’s the difference?” he asked. Later, in his third State of the Union address, instead of acknowledging to the nation the misguided nature of his previous warnings following these revelations, President Bush attempted a rhetorical sleight of hand, speaking not of Hussein’s actual weaponry but of something he termed “weapons-of-mass-destruction-related-program-activity.”

All of the information presented here was available in open, mainstream sources published by early 2004. How much happier and healthier the world would be if the media had simply carried out their collective responsibility and held the administration accountable for a simple matter such as truth. Who knows whether the Arab Spring might have made it to Iraq and deposed that dictator without the unending catastrophe caused by President Bush and Vice President Cheney’s hubris and dishonesty and the fecklessness of the people whose job it was to prevent its happening.

History may not repeat itself but it is a rule of thumb that the sequel is almost always worse than original. The consequences of LBJ’s deception were far worse than those of FDR’s. But sadly for everyone involved, President Bush’s trumps them all.

Eric Alterman is a Senior Fellow at the Center for American Progress and a Distinguished Professor of English at Brooklyn College and the CUNY Graduate School of Journalism. He is also a columnist for The Nation, The Forward, and The Daily Beast. His newest book is Kabuki Democracy: The System vs. Barack Obama. This column won the 2011 Mirror Award for Best Digital Commentary.

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Poll: 60 GOP House Members Out-of-Touch

2011-12-20T21:43:00.002-05:00

As they block an extension of a payroll tax cut for 160 million Americans, 60 Republican House members in battleground districts are out-of-touch with key voters, and "the election year from a position of profound weakness," according to a new survey released by Democracy Corps/Women’s Voices. Women Vote Action Fund (WVWVAF).

These incumbents particularly are out-of-touch with what the pollsters call the "the Rising American Electorate (RAE)."

"These voters—unmarried women, African Americans and Hispanics voters and youth—account for a majority of the nation’s voting eligible population (53 percent)," says the pollsters' memo describing the poll results. "They drove progressive victories in 2006 and 2008, delivering 69 percent of their vote to congressional Democrats in national surveys. Opportunities in 2012 for progressive candidates would be much broader if the RAE vote was consolidated and achieved those historic support levels."

Voters, including those in the RAE, believe Republicans are out-of-touch on taxes and the deficit and prefer a more cooperative approach to governance from the Republican majority, rather than a strategy of obstruction and delay, the pollsters say.

"As a result, this class of battleground Republican incumbents enters the election year from a position of profound weakness," the memo says. "Electorally, they are held under 50 percent in a named trial heat for Congress; less than 40 percent commit to reelecting their incumbent 'because he/she is doing a good job and addressing issues that are important to us.'"

As real legislation has ground to a halt in Washington, a 60-percent majority of voters in these Republican-held districts want their incumbent “to try and work with President Obama to address the country’s problems,” and this jumps to 66 percent among voters in the RAE, the pollsters say. Just a third (34 percent; 27 percent in the RAE), want their representative to block the president.

To succeed, however, Democrats must highlight the contrast between the two parties, the pollsters say.

"Voters in the RAE deliver higher support for President Obama and the Democrats than other voters; there is less differentiation in their support for Republicans. Notably, after voters hear balanced criticism of both sides, key segments of the RAE, most notably unmarried women, move to the Democrats," their memo says.

The survey of 1,000 likely 2012 voters in 60 Republican battleground districts was conducted by Greenberg Quinlan Rosner for Democracy Corps and Women’s Voice Women Vote Action Fund from December 4-7. The pollsters report a margin of error = +/- 3.1%

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Better Buildings Initiative Drives Investment, Creates Jobs

2011-12-20T05:47:00.002-05:00

This article was published by the Center for American Progress.

By Bracken Hendricks, Jorge Madrid, Adam James

The business of creating jobs and leading our country to a cleaner and more prosperous future must continue even in the face of perpetual stalemate in Congress. President Barack Obama has found a way to continue leading on energy efficiency by using his executive power over federal agencies and he is getting help from a diverse coalition including commercial real estate developers, bankers, universities, and local governments, as well as partners as diverse as organized labor and the U.S. Chamber of Commerce.

Earlier this month the president announced a series of commitments under the Better Buildings Initiative, a historic public-private partnership that will leverage $4 billion in new investment for job-creating energy-efficiency upgrades to more than 4 billion square feet of public and private buildings over the next two years. These commitments will cut our nation’s energy use by 20 percent by 2020.

They will create jobs, too. Doing this work will create new demand for approximately 114,000 jobs in the building trades and domestically sourced construction materials at a time when the industry continues to suffer from near-depression levels of unemployment.

It will also be completed at zero cost to taxpayers by using energy savings to pay back upfront public investments in government buildings and leveraging private investment to jumpstart retrofits—energy-saving technologies that span everything from insulation and sealant to water heaters and solar panels—in commercial office buildings.

Altogether, this voluntary partnership—which brings together a wide range of organizations including federal agencies, labor unions, retailers, colleges, and hospitals, among others—will generate $1.4 billion in savings on energy costs for American businesses.

This critical venture will also help jumpstart the market for energy-efficiency financing and make it easier for private companies, pension funds, and other financial entities to invest in these projects.

The Obama administration used executive action as part of the initiative by directing federal agencies’ procurement strategies, a decision that requires no additional fiscal requests and fits within their existing budgets.

The bold leadership and public-private partnerships just described are precisely what the country needs to cut through partisan gridlock in Congress and get back to work. The partnerships will open up new investment streams to build a market around low-cost, low-risk capital improvement projects that will immediately create jobs, save consumers money, and reduce pollution and harmful emissions.

Here we tell the story of how the Better Buildings Initiative came together. It’s a great example of how government can get job-creating energy-efficiency programs up and running during tough fiscal times.

How the program built partnerships

Solving big problems requires innovative and streamlined governance as well as robust participation from a diverse set of actors. In today’s reality of constrained budgets and limited cooperation from Congress, mutually beneficial partnerships between government and nongovernment entities that transcend partisan interest are needed more than ever.

This is exactly what happened when President Obama announced the Better Building Initiative on February 3 of this year—a national challenge to spur private investment for energy efficiency in commercial buildings.

The initiative, spearheaded by former President Bill Clinton and President Obama’s Council on Job’s and Competitiveness, included an initial boost of support from two unlikely allies: the U.S. Chamber of Congress and organized labor groups such as the AFL-CIO and the American Federation of Teachers.

The chamber recognized that this program would be critical for creating jobs and spurring economic activity for the nation’s struggling businesses. The labor groups affirmed their support for this program by committing $150 million in capital from pension funds over the next few months, a first step toward investing billions more over the next decade. While Congress remains stuck in counterproductive bickering, American workers stepped up to the plate and invested their retirement security to pay forward a new generation of good jobs with decent wages, rebuilding the smart infrastructure and more efficient buildings that will make the whole economy more competitive.

This early leadership by businesses and working families was absolutely critical to growing the coalition that ultimately culminated in the $4 billion investment in the program. Moving forward this sort of public-private partnership to build a sound market for productive capital investments in energy efficiency may be our best hope of breaking the political impasse and restoring the health of the struggling U.S. economy.

How the program builds markets

Experts agree that energy efficiency is the “low-hanging fruit” in tackling our nation’s energy security and economic challenges. These are smart investments that pay for themselves over time. And at a time when few analysts predict resurgence in new construction any time soon, making buildings more efficient through retrofits can be an important catalyst to economic recovery by creating much-needed jobs. But despite the promise of these investments, real barriers have blocked their growth. We outline below how these barriers were overcome for the Better Buildings Initiative.

Overcoming hurdles to financing projects

One of the primary challenges in deploying large amounts of capital into energy-efficiency projects is the lack of clear pathways for investors to finance this infrastructure.

Energy-efficient building improvements result in immediate savings and lower operation costs, improving the overall profitability of real estate investments. They accelerate capital improvements in existing assets and strengthen real estate markets overall. But unlocking these savings requires large amounts of upfront capital.

Another issue is that traditional lending is secured by clearly defined assets: When you take out a mortgage it is secured by the property itself. But when you want to finance a new boiler, some duct work, and replacement windows, the collateral to back that loan is less clear.

Plus, while everyone agrees these investments are a good deal and save real money, it takes time for banks to assemble the deep data they need to assess the risks and returns that investors can expect to face.

As a result, this very secure and productive investment opportunity lacks “mainstream” credentials, clearly understood investment vehicles, and a mechanism to move capital into a market hungry to get to work.

Private capital responds to movement and trends in the marketplace, and investments flow to ventures that are considered stable and economically sound. For the Better Buildings Initiative partnership, private-sector actors such as Citi and emerging financial service providers such as Green Campus Partners and Transcend Equity committed to make direct investments in commercial retrofits and structure innovative financial products that met the risk thresholds of private real estate owners.

Additionally, the White House will use its own procurement power by directing federal agencies to finance $2 billion up front in these energy-saving retrofits, saving much more money over time. These savings are passed along to the taxpayers because the federal buildings will consume less energy than they would have otherwise.

This arrangement will be accomplished through Energy Service Performance Contracts, or ESPCS, in which future energy savings are used to purchase upfront capital investments. Payback on these ESPCs is structured so that a portion of the savings is kept by the contractor, providing a guaranteed return on investment, while the other portion is used to capitalize these projects.

ESPCs are a well-understood tool for driving productive investments, and the White House showed real leadership in building on the success of this program. To date, more than $2.46 billion has been invested in federal energy efficiency and renewable energy through these contracts, resulting in 309.5 trillion BTU (British thermal unit) saved and $6.66 billion in energy-cost savings.

Energy Service Performance Contracts are particularly advantageous in a gridlocked legislative atmosphere since they do not require additional appropriations from Congress or upfront capital from tight agency budgets.

In this context, President Obama’s leadership in launching the Better Buildings Initiative is all the more important. The $4 billion pipeline of public and private financing cut through the red tape to catalyze a growing industry and an emerging sector of the capital market. The private sector is now on notice that energy-efficiency markets are open for business.

Generating demand for projects

With financing secured and repayment through energy savings set in place with ESPCs, the federal government will generate demand for energy-efficiency projects by opening billions of square feet of its own property for retrofits—hiring thousands of contractors and hundreds of thousands of construction workers around the country to upgrade federal buildings.

Additionally, the partnership secured commitments from large property owners across the country to upgrade 4 billion square feet of commercial and industrial property. These include corporations such as Nissan and General Electric; national retailers such as Best Buy and Walgreens; hospitals; cities and states; and colleges and universities.

The initiative now has a built-in customer base with solid financing and stable repayment structures through energy savings. The demand represents a pipeline of work that businesses can start to serve. The nongovernmental entities and businesses that get put on the job will hire contractors and workers and the virtuous cycle of savings, investment, and job creation will continue.

Furthermore, from an investment perspective, the opportunity in the commercial sector is vast, totaling 87 billion square feet of floor space. This represents 25 percent of the total efficiency potential in the United States, amounting to $290 billion in savings. The Better Buildings Initiative sends a signal that this massive market is open and ready for business.

Together, these financial and real estate commitments are already helping to jumpstart the market and drive additional investments from the private entities mentioned above, propelling energy-efficiency finance further into the mainstream.

The program is a success

The indispensable element in achieving the results of this program was the significant leadership vision of Presidents Obama and Clinton, and the deep bipartisan support of their partners in business and labor, state and local government, and across the construction and financial services industry.

At a time of bitter tensions in the federal government, Congress would do well to stop debating whether clean energy jobs are real and instead get to work creating some. If they need any help getting started, they need look no further than the White House Better Buildings Initiative.

Bracken Hendricks is a Senior Fellow, Jorge Madrid is a Research Associate, and Adam James is a Special Assistant for the Energy team at the Center for American Progress.

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Think Again: Is Inequality Over? News That’s Not Fit To Print

2011-12-18T06:13:00.002-05:00

This article was published by the Center for American Progress.

By Eric Alterman

In an article entitled “Top Earners Not So Lofty in the Days of Recession,” by the star New York Times journalist Jason DeParle, we are told to “hold the condolence cards the recession cost the rich. The share of income received by the top 1 percent—that potent symbol of inequality—dropped to 17 percent in 2009 from 23 percent in 2007, according to federal tax data,” he explains. “Within the group, average income fell to $957,000 in 2009 from $1.4 million in 2007.”

DeParle admits, almost immediately, that “analysts say the drop largely reflects the stock market plunge, and most think top incomes recovered somewhat in 2010, as Wall Street rebounded and corporate profits grew.” Nevertheless, he notes, “The drop alters a figure often emphasized by inequality critics, and it has gone largely unnoticed outside the blogosphere.”

Unnoticed? DeParle then quotes Occupy Wall Street critics such as Steven Kaplan of the University of Chicago and Megan McCardle of The Atlantic who insist that the 2009 numbers demonstrate the irrelevance of the arguments of the “99 Percent.” “We don’t want to spend years focused on income inequality, only to learn that the financial crisis fixed it for us,” wrote McArdle in a blog post for The Atlantic. DeParle also quotes James Pethokoukis, a blogger at the American Enterprise Institute, as if they constitute genuine wisdom. “Get a time machine, Occupy Wall Street,” wrote Pethokoukis.

To be fair, DeParle gives the “other side” a fair shake, quoting former White House official Jared Bernstein saying, “The structural forces driving inequality remain very much in place.” (The mere fact that DeParle is forced to quote right-wing bloggers compared to someone with Bernstein’s credentials is itself revealing.) And DeParle himself does a pretty good job of enumerating all of the reasons why inequality, “driven by political and economic forces,” has been growing for more than 30 years. He reports:

Globalization created larger markets for those with scarce talents but hurt less educated workers by pitting them against cheap foreign labor. New technology also hurt unskilled workers, by replacing many with machines.

Unions declined, eroding blue-collar bargaining power. The financial industry grew, with paydays heavily weighted toward the top. Corporate culture accepted the growing gap between the executive suite and the factory floor.

Falling tax rates on the highest earners added to the net income divide, by allowing top earners to keep more of their pay and increasing their incentive to maximize it.

But the real, underlying truth is that the 1 percent’s loss of income is a blip in which the super rich in America experienced a decidedly modest and temporary hit when financial markets collapsed. Structural factors have been driving this process well beyond the rate that any other western democracy has seen. The intensity of the U.S. case is discussed (and can be seen in graphs) published in this essay by University of Texas economist James Galbraith.

Indeed, using more recent data, Larry Mishel of the Economic Policy Institute explains, in a critique of DeParle’s article, that what DeParle predicted has already taken place:

Wage and salary data show wage inequality rising from 2009 to 2010 (recovering more than a third of lost ground), suggesting that it is too early to shed crocodile tears for the top 1 percent. Regardless of last year’s trend, it remains the case that income inequality in 2009 was still substantially greater than it was in the late 1970s. Moreover, the conclusion that a lion’s share of income gains accrued to the top 1 percent or even the top 0.1 percent, while income growth was modest for the bottom 90 percent remains absolutely true.

What’s more, despite the temporary drop in stock market valuations, and therefore Wall Street bonuses, Mishel notes, “Corporate profits are now substantially greater than they were before the recession.” The share of corporate income going to profits was 26.2 percent last year, its highest share since World War II, when we had wage and price controls. Moreover, in 2010, Mishel explains, “The wages of those in the top 1 percent grew 6.8 percent in inflation-adjusted terms while those in the bottom 90 percent saw their real annual earnings fall 0.7 percent.”

Look at the overall picture: Today half the U.S. population owns barely 2 percent of the country’s wealth, putting the United States near Rwanda and Uganda and below such nations as pre-Arab Spring Tunisia and Egypt when measured by degrees of income inequality.

And contrary to the passive voice employed in DeParle’s article, tax rates do not “fall” by themselves. As political scientists Jacob Hacker and Paul Pierson demonstrate, these falling tax rates are the direct result of the purchasing of political power by the extremely wealthy in the United States to rewrite the laws in their favor. (The reduced tax rate on capital gains is among the greatest and most unfair boons to the super rich.)

Now all of this wealth accruing to the extremely wealthy may strike some ideologically driven conservatives as necessary and even desirable. Lower taxes, less regulation, and less government are seen as goals in and of themselves, regardless of their impact on public policy, because they weaken government’s ability to intervene in the lives of its citizens. Milton Friedman argued, “Freedom in economic arrangements is itself a component of freedom broadly understood, so economic freedom is an end in itself.”

But why The New York Times would wish to use outdated data to give careless readers the impression that all is hunky-dory in this nation regarding its remarkably skewed distribution of wealth is a question that only its editors and reporters can answer.

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One in Five Conservatives Believe Mitt Romney Is Too Liberal

2011-12-15T07:44:00.000-05:00

A new poll demonstrates just how much trouble Republican presidential hopeful Mitt Romney's having with the conservative GOP base.

Once the putative frontrunner, Romney's standing has ebbed and flowed against several potential Republican rivals. He's currently battling former House Speaker Newt Gingrich as the candidates head into the first GOP caucuses and primaries starting next month.

Among all Americans, two in five like Mitt Romney as a person (40 percent), over one-third (36 percent) say they like his track record as governor and one-third (33 percent) like his political opinions, according to a new Harris poll. But over one-third of U.S. adults also say they are not sure about Mitt Romney as a person (34 percent), not sure about his track record as governor of Massachusetts (38 percent) and not sure about his political opinions (34 percent).

These are some of the results of the Harris poll of 2,499 adults surveyed online between November 7 and 14.

Among Republicans almost three in five (58 percent) like Romney as a person, half (49 percent) like his track record as governor and 57 percent like his political opinions. Among conservatives, these numbers drop a little. Just half of conservatives like Romney as a person (49 percent) and like his political opinions (48 percent) while just two in five conservatives like his track record as governor (39 percent).

When given some statements about Romney, again there is a little bit of the unknown. Just over half of Americans (54 percent) say Romney is an intelligent person with one-third (32 percent) saying they are not sure and while half (49 percent) believe his business experience would be an asset, again one-third (32 percent) are not sure. Romney has also been charged with "flip-flopping" and 44 percent of Americans agree that his stance on issues depends on who he is talking to, not his core convictions, with over one-third (36 percent) not sure about this.

However, just 20 percent of Americans say Romney lacks experience and is not qualified to be president with half (48 percent) disagreeing with that statement but, again, one-third (32 percent) are not sure.

The issue of religion has also been raised and while 52 percent of Americans say Romney being Mormon is not an issue, one-quarter say it is (23 percent) and the same number are not sure (25 percent). The one thing that evenly divides Americans is if he inspires confidence personally. One third of Americans think Romney does (35 percent), one third says he does not (33 percent), and one-third are not sure (32 percent).

Among Republicans, two-thirds believe Romney is intelligent (69 percent) and that his business experience would be an asset (67 percent), while over half (53 percent) say he inspires confidence personally. Just over one-quarter (27 percent) say his being Mormon is an issue but two in five Republicans (41 percent) say his stance on issues depends on who he is talking to and not his core convictions. His numbers are a little weaker among conservatives as just three in five say he is an intelligent person (61 percent) and that his business experience is an asset (61 percent) with less than half (46 percent) agreeing he inspires confidence personally. Slightly over two in five (43 percent) agree his stance on issues depends on who he is talking to and not his core convictions while one-quarter (26 percent) say his being Mormon is an issue.

Looking at Romney's political ideology, one in 10 Americans (8 percent) say he is too liberal, compared to 15 percent of Republicans and one in five conservatives (20 percent). On the flip side, 16 percent of U.S. adults say Romney is too conservative. One-third of Americans (32 percent) say he is neither too liberal nor too conservative but almost half (45 percent) are not sure, including one-third of Republicans (34 percent) and two in five Conservatives (39 percent).
If Romney was the Republican nominee, one-third of Americans (33 percent) would vote for him, 38 percent would not and 25 percent are not sure. Two-thirds of Republicans (65 percent) would vote for him, but just over half of conservatives (57 percent) say the same. Two in five independents (40 percent) would vote for Romney while one-third would not (34 percent) but among moderates two in five would not vote for him (39 percent) while 27 percent would.

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How the Nixon Pardon Strained a Presidential Friendship

2011-12-15T06:29:00.002-05:00

by Patrick Flanary, Special to ProPublica

Thirty-one days into his presidency, Gerald Ford, with the stroke of a pen, granted a full and absolute pardon to his predecessor, Richard Nixon, who had resigned from office on Aug. 9, 1974. It was the only time an American president had pardoned another. And Ford did so as television cameras rolled, minutes after dealing with another resignation -- that of his press secretary and longtime friend, Jerald terHorst.

"He made a blunder on the Nixon pardon," terHorst said during a previously unpublished interview in November 2009. "It wasn't so much that I objected to the pardon as it was that it set one man above the law. We don't do that in our country."

terHorst died last year at age 87. But his lifelong conviction that Ford had overreached reflects the lasting echoes of history's most controversial pardon and highlights a philosophical divide over this unchecked presidential power: Are pardons acts of justice for righting wrongs and healing a nation's wounds? Or do they turn justice on its head by giving special favors to a few?

In 1974, Ford's pardon further shocked a country divided over Nixon's exit amid the ongoing Watergate scandal. It also tested a friendship of some 25 years -- terHorst had met Republican Ford in 1948 while covering his first congressional campaign in Grand Rapids, Mich.

Ford explained the pardon in his 1979 autobiography. Putting a former president on trial, in his view, was not worth the additional national trauma from scrutinizing Nixon's actions, especially when prosecutors already were pursuing Nixon's top aides on Watergate charges.

"Although I respected the tenet that no man should be above the law, public policy demanded that I put Nixon -- and Watergate -- behind us as quickly as possible," Ford wrote. "Being forced to resign the Presidency and live with that humiliation the rest of his life was a severe punishment in itself, the equivalent to serving a jail term."

Some opponents of the pardon immediately suspected there had been a backroom deal between Nixon and his vice president in which Nixon would go free in return for Ford getting his job. When journalist Carl Bernstein heard the news on the radio, he called Bob Woodward, the Washington Post colleague with whom he had broken the Watergate story. "You're not gonna believe it," Bernstein told Woodward. "The son of a bitch pardoned the son of a bitch!"

terHorst acknowledged that Ford's motive was to scrub the Watergate stain out of the national fabric. But terHorst believed there was something fundamentally amiss. "This was a violation of the oath Ford and I took," he said in the 2009 interview. "We both took the same oath: Uphold the Constitution. We are all under the law. But Nixon got away. How could I defend that?"

In his resignation letter, terHorst cited "the absence of a like decision to grant absolute pardon to the young men who evaded Vietnam military service as a matter of conscience, and the absence of pardons for former aides and associates of Mr. Nixon who have been charged with crimes -- and imprisoned -- stemming from the same Watergate situation."

Ruling for the majority in the 1915 case Burdick v. United States, Supreme Court Justice Joseph McKenna ruled that a pardon "carries an imputation of guilt; acceptance a confession of it." For a time, Ford reportedly carried this excerpt in his wallet. Biographer Douglas Brinkley wrote that the Burdick case "had redefined the whole concept of a pardon. Issuing a pardon did not mean exoneration of the recipient, as most people thought. Instead, a pardon rendered a verdict without a trial -- or punishment. Ford seized on the point."

terHorst, writing in "Gerald Ford and the Future of the Presidency," a biography published just two months after he quit, had argued for more accountability: "How could Ford grant an unconditional pardon to the former President without getting in return a signed ‘confession' of his Watergate participation?"

Some say terHorst's views show a basic misunderstanding of the Constitution. "Setting one man above the law is exactly what the pardon power is all about," said Margaret Colgate Love, who served as the Justice Department's pardon attorney from 1990-97.

"The president may grant a pardon for reasons you don't agree with, and the result may not be acceptable to some or even most people," Love said, "but it is what the power is."

Love noted George H.W. Bush's pardons of participants in the Iran-Contra, arms-for-hostages affair and Ronald Reagan's pardon of Mark Felt, who had been convicted of felony civil-rights violations while a top FBI official. Decades later, Felt was identified as "Deep Throat," Woodward's shadowy, off-the-record source for Watergate stories.

Time has changed Bernstein’s opinion of the Nixon pardon, he told ProPublica. When it happened, he said, he sided with terHorst's decision to walk away from what appeared to be further corruption. Now Bernstein believes Ford did the right thing.

"It turns out it really was a courageous and necessary act," Bernstein said. "Gerald Ford, I think partly by being a member of Congress before he was vice president, understood how necessary it was for the system no longer to be so enmeshed in Watergate in such a way that it would go on for another couple of years."

The Nixon pardon abruptly ended Ford's honeymoon period and shadowed his presidency. Ford narrowly lost to Democrat Jimmy Carter in the 1976 election; Ford's efforts to move the country beyond the scandal seemingly had worked against him. Though he and terHorst had publicly split, they spoke shortly before Ford died in 2006. "We were never unhappy with each other," terHorst recalled in the interview. "He went one way, I went the other."

terHorst's view of the pardon stood firm. "I have never changed my mind," he said in 2009. "It was a bad deal then, and it's a bad deal today. Presidents are not exemptions to the law."

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Trouble For Obama Campaign? Justice Party Launches Calif. Ballot Drive

2011-12-15T05:25:00.005-05:00

In a move which could cloud President Obama's re-election campaign, a new third party called the Justice Party has begun a ballot-access drive in California.

Headed by presidential candidate Ross "Rocky" Anderson, the Justice Party could complicate Obama's left flank in a way that Ralph Nader helped frustrate Democrat Al Gore's election to the White House in 2000.

He may be a former mayor of Salt Lake City in the deep-red state of Utah, but Anderson and his Justice Party appear to be staking out highly progressive positions on corporate influence of government, environmentalism, and national security.

Anderson and his party don't appear to be sitting back as minor players.

The Justice Party National Committee (JPNC) on Thursday launched its California "Force for Justice" Ballot Access Campaign. The Golden State requires that 103,000 California residents, who are eligible to vote, file a new voter registration form and designate their party affiliation as the Justice Party, by Jan. 2, 2012. Only paper voter registration forms must be used.

"Californians are being invited to join the Justice Party and lead the Force for Justice Campaign in a grassroots community-by-community mobilization. Already, we have dozens of people that are mobilizing to set up events and activities to register people to vote," says Paul Zeitz, acting chair of the JPNC Steering Committee. "Media, events, and mobilization efforts are envisioned to be locally led and run around the State of California during the period of December 17, 2011 – January 2, 2012. The Justice Party calls on all Californians to take action now to show the nation and the World the promise of the Justice Party. California can lead the nation, as the old saying goes 'as California goes, so goes the nation.'"

A former Democrat who led Salt Lake City for two terms as mayor, Anderson introduced his nascent presidential campaign two weeks ago on Rachel Maddow's MSNBC program, in which he emphasized a number of left-leaning themes which appear designed to appeal to the national Occupy Wall Street movement.

Among his issues, Anderson says he will tackle unemployment and income inequality.

"We are in a new Gilded Age in this country with the greatest disparity of wealth since the 1920s. And people are suffering, the lack of a decent jobs program," he says. "This party, the Justice Party, will fight for the people."

While Anderson has little real chance of being elected president, he could challenge Obama on the left and complicate the president's ability to win a second term.

Longtime consumer advocate Ralph Nader played a similar role in 2000, when he ran for president on the Green Party ticket. Nader ran to Vice President Al Gore's left that year, arguably siphoning support.

Nader won just 2.74 percent of the vote nationally, but his candidacy could have pulled enough support from Gore in the key state of Florida, in which he trailed George W. Bush by just 537 votes.

The Florida results, and subsequent U.S. Supreme Court decision, ultimately cost Gore any chance of becoming president.

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Emails Suggest Ohio’s New Republican-Friendly Maps Save the GOP ‘Millions’

2011-12-14T06:52:00.002-05:00

by Lois Beckett, ProPublica

As we’ve been documenting in our ongoing series, political parties and other powerful players use the once-a-decade redistricting process to advance their own goals — often at the expense of voters.

A recently released trove of email messages from Ohio offers a rare inside glimpse into how it works.

The messages, sent from June to September, show collaboration between the national GOP and state Republicans to redraw Ohio’s maps and thus cement control of both the statehouse and a majority of congressional districts.

In one email, a Republican consultant working on redistricting for the state suggested that the new political maps could save the GOP “millions" of dollars in campaign funds by making districts safer for Republican candidates.

The maps, approved by the Republican-run state legislature in September, favor Republicans in 12 of Ohio’s 16 new congressional districts. And they strengthen the majority of likely Republican supporters in at least 17 state house districts, according to the mapping consultants' own calculations.

The congressional maps also split voters in Toledo into three separate districts, a move the mayor said would make the city “politically irrelevant,’’ and put two longstanding Democratic members of congress who live 110 miles apart in the same district, a tactic redistricting experts call "hijacking." (See our rundown of various redistricting techniques, such as packing, cracking and hijacking, or watch our redistricting music video.)

A spokesman for Ohio’s House of Representatives said the email messages and accompanying report, released by the Ohio Campaign for Accountable Redistricting, were an attempt to garner “salacious” and “malicious” headlines. Mike Dittoe, director of communications for the Ohio House of Representatives and for Republican Speaker Bill Batchelder, said Ohio’s redistricting was “a fully transparent process that yielded a fair and legal map.”

Redistricting is supposed to benefit voters by equalizing districts as the nation's population shifts. But with few strict requirements for how to shape districts — they must have roughly equal populations and not discriminate against minority voters — political parties often can draw political lines largely to their own benefit.

Much of the time, the toughest balancing act in the map-drawing process is how to please multiple incumbents at once.

In the email messages obtained by the Ohio Campaign for Accountable Redistricting, such partisan concerns were central. In one email, the president of the state senate, Republican Thomas Niehaus, noted that "I am still committed to ending up with a map that Speaker [John] Boehner fully supports," even though the U.S. House speaker and Ohio Republican "has no official role in the redistricting process," as a spokesman said in November.

Among those consulting closely by email regarding the district lines was the executive director of Team Boehner, a group created to help Republican House candidates across the nation, and the redistricting coordinator from the National Republican Congressional Committee. Rather than work in the state house, the state’s redistricting staffers rented a hotel room for three months.

Dittoe, the House spokesman, said the state received redistricting input from many stakeholders, including all 18 of Ohio’s current members of Congress — Ohio loses two seats in the latest redistricting — and Ray Miller, a former Democratic state politician.

The redistricting consultants also pushed through an 11th-hour change to the maps that switched the location of The Timken Company back to the district of U.S. Rep. Jim Renacci. Timken, a manufacturer of bearings, alloy steels and related components, is one of Renacci's top donors. Members of the Timken family, company officials and a company PAC have given at least $210,000 to Renacci in the past two years, according to The Cleveland Plain Dealer.

“Thanks guys. Very important to someone important to us all,” Tom Whatman, the executive director of Team Boehner, wrote after the change was completed.

“In no way do campaign contributions influence how lines are drawn,” Dittoe said.

The redistricting emails included a consideration of partisan advantage down to the level of individual streets.

In an email to Ray DiRossi, one of the two staffers responsible for drawing the state’s maps, a Republican state senator said she knew that another Republican state legislator was “looking for Republicans” in her county and suggested a list of more than 80 streets in 10 neighborhoods where she had received a “good response.”

In September, as the redistricting maps were being approved, the chief of staff for the Republican state house speaker sent DiRossi a list of 43 of the state's legislative districts, ranked according to the total of so-called in-kind contributions made to House races in each district.

According to the Federal Election Commission, "The donation of office machines, furniture, supplies — anything of value — is an in-kind contribution. … A donation of services is also considered an in-kind contribution."

In nine of the districts, in-kind donations totaled more than $2 million over the past decade.

The rankings appeared to be a measure of which districts had been most competitive over the past 10 years, since many of the districts that received the most in-kind contributions had alternated between Republican and Democratic control.

"Ray was running a quick analysis on inking contributions made to house races over the last decade and thought you'd find it interesting which districts were on top," Troy Judy, Ohio House Speaker Batchelder's chief of staff, wrote in an email.

DiRossi wrote back a few minutes later, expressing surprise at the position of two districts on the list. "But we have made significant improvements to many HDs [House districts] on this list. Hopefully saving millions over the coming years," he added.

DiRossi’s comment seemed to suggest that the new maps would be less competitive and thus require fewer campaign donations — a potential savings of millions of dollars.

"It's 1AM—go to bed you political junkies," Heather Mann, another of the state's redistricting staffers, wrote back.

Dittoe said the contribution statistics were sent to several people, and that since the redistricting maps had already been completed by the time the email was sent, the statistics could not have prompted any changes in the maps.

DiRossi and Mann, who is currently a deputy legal counsel in Batchelder’s office, were each paid $105,000 in public money for a few months of redistricting work, according to public documents obtained by the Ohio Campaign for Accountable Redistricting.

Anything said about redistricting by politicians can be used as evidence in a legal challenge of a mapping plan, so politicians are typically warned to keep silent in public about redistricting plans. In a ProPublica interview last week, Georgia Congressman Lynn Westmoreland, a point man for the Republicans' redistricting effort, said congressional delegations were briefed on redistricting protocol and warned that whatever they said could be used in court.

Westmoreland said he also warned members of Congress to work as a team and “not to get greedy.”

“Pigs get fat; hogs get slaughtered,” he said.

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Union Chief Blasts House GOP for Vote on Unemployment Insurance

2011-12-14T05:35:00.005-05:00

Calling them "callous," a prominent labor leader denounced House Republicans for their approach to extending unemployment benefits to jobless Americans.

The GOP-led House voted Tuesday to extend emergency unemployment insurance beyond the end of the year for Americans, but only after also cutting and restricting the benefits.

"It's bad enough that Republicans blocked bills to create jobs, but now they cut unemployment benefits for people who can't find work," says Jim Hoffa, general president of the Teamsters labor union. "People can't 'just get a job' when there are four unemployed people for every job opening."

Meanwhile, independent Washington analysts also criticized the Republican approach as both unfair and potentially bad for the overall U.S. economy.

The House voted to extend the payroll tax cut and unemployment insurance (UI) beyond the Dec. 31 expiration date. However, the bill cuts unemployment benefits by 40 weeks, requires recipients to have a high school diploma or GED and charges them for re-employment services. Republicans insisted on these cuts.

"Our economy will continue to stall unless we put money in the pockets of people who will spend it," Hoffa says. "This is a callous move by House Republicans, who apparently don't care if America's middle class disappears."

Unemployment, now at 8.6 percent, has exceeded 8 percent for nearly three years, the longest since the government began keeping records in 1948.

The National Employment Law Project estimates that the cuts in the House bill would cost $22 billion in lost economic growth and 140,000 fewer jobs next year.

The changes to the unemployment-insurance system approved by the House would not only make it harder for workers who lose their jobs through no fault of their own to qualify for benefits, but also make the system more costly to administer, according to an analysis by from the Center for Budget and Policy Priorities (CBPP), a Washington think tank.

The "punitive elements" of the House Republican bill "imply that unemployed workers aren’t looking hard enough for a job and that too many of them are eligible for UI in the first place," the CBPP analysis says.

"In reality, there are about four jobless workers for every available position, so even if every available job were filled by an unemployed worker, nearly 10 million people would still be unemployed," it says. "Moreover, unemployed workers already must satisfy numerous requirements to claim UI benefits; largely as a result, only about 40 percent of the unemployed in a normal labor market receive UI.

"Today’s economic conditions, plus forecasts that unemployment will remain high for at least the next two years, justify continuing federal emergency UI as it is currently," the CBPP analysis says.

Some 40 percent of unemployed Americans have been looking for work for over six months, a larger share than at any time in the last 60 years prior to the current downturn, the analysis finds.

Further, CBPP concurs that cutting unemployment insurance would take needed cash out of the U.S. economy at a time when it needs it. The analysis cites the nonpartisan Congressional Budget Office, which says UI benefits represent the biggest “bang-for-the-buck” to keep the economy moving.

Tuesday's House vote sets up a likely confrontation with the Senate, where the Democratic majority has advocated for an extension of unemployment benefits free from the cuts and restrictions imposed by the House bill.

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Lending a Hand to the Maxed-Out Consumer

2011-12-14T04:46:00.002-05:00

This article was published by the Center for American Progress.

By Christian E. Weller

Congressional Republicans are dithering on critical assistance for America’s middle class—a temporary payroll tax holiday—at a time when families and the economy are in dire need of help.

A House GOP bill scheduled for a vote today does extend the payroll tax cut for a year. But it also cuts funding for health reform, freezes federal employee pay for another year, curtails the length of emergency unemployment insurance, blocks environmental protections from moving forward, and forces the president’s decision on a controversial oil pipeline project. Those provisions all but guarantee the bill’s defeat in the Senate and render the Republican proposal unserious.

That’s a tragedy for American families still suffering from crushing debts. They are putting off consumption, and in turn firms are holding back business investment because they can increase sales slowly without increasing capacity. Economic growth and job creation are slow as a result.

This column examines how continuing the payroll tax holiday, along with maintaining extended unemployment-insurance benefits, is the most effective way to allow families to reduce their debt burden and thus return consumption, investment, and economic growth to better health.

Low consumption is holding back economic growth

Consumption is the single-largest component of the economy. Consumer spending, outside of spending on owner-occupied housing, makes up about 70 percent of the entire economy. [1] Consumption, however, has grown by only 5 percent in inflation-adjusted terms from June 2009, when the economic recovery officially started, to September 2011. This is the slowest consumption growth for any economic recovery of this length since World War II. [2]

The most recent quarter, from July to September 2011, highlights consumers’ struggles with maintaining even modest consumption growth. Consumption grew at an annualized, inflation-adjusted rate of 2.3 percent in the third quarter of 2011, well below the long-term historical average growth rate of 3.5 percent before the Great Recession. [3]

This subpar performance required households to substantially decrease their saving. The personal saving rate dropped from 4.8 percent of after-tax income in the second quarter of 2011 to 3.8 percent in the third quarter in 2011. This was the lowest saving rate since the fourth quarter of 2007, just before the Great Recession.

Consumers cannot cut their saving much more to support consumption growth.

How to deal with heavy debt burdens that are weighing down consumer spending

Lack of consumption is partly driven by consumers having other priorities to worry about. Chief among them is a still-massive debt burden. Households owed a record-high 129.9 percent of their after-tax income in September 2007 but only 114.2 percent of their after-tax income in September 2011. [4] This reflects an unprecedented drop in the ratio of debt to after-tax income, but the total debt burden in September 2011 was still higher than at any point before the middle of 2004, dating back to 1952.

There are three options to reduce household debt burdens further.

One is for banks to write off more debt by continuing a massive wave of foreclosures and by agreeing to allow more short sales where homeowners sell their homes for less than they owe. Banks are reluctant to incur even larger losses than they already have, so debt write-offs are unlikely to grow.

Alternatively households could refinance their existing debt into lower-interest rate debt, but banks are still holding back on extending new loans, so refinancing opportunities are few and far between.

This leaves boosts to after-tax income growth to lower the household debt burden since more after-tax income will make it easier for households to repay their debt.

How extending the payroll tax would cut debt burdens, boost spending, and help grow the economy

A hypothetical example helps illustrate how faster after-tax income growth can cut households’ debt burdens.

Household debt stood at 114.2 percent of after-tax income in the third quarter of 2011, but as I pointed out earlier that is still too high. The average debt-to-after-tax-income ratio for the late 1990s, when the economy and the labor market were strong, was 89.2 percent.

It will take until June 2017 before households reach this level of debt again, if after-tax incomes continue to grow at the low annual rate of 2.9 percent and if debt continues to drop at the unprecedented annual rate of 1.5 percent that has occurred during the recovery so far. [5]

Households, however, will get to sustainable debt levels six months earlier for each year that personal after-tax income grows 3.1 percentage points faster. Increasing after-tax income by 3.1 percent for one year—which would happen if Congress continues the payroll tax cut for another year—means that households will get to sustainable debt levels in late 2016 instead of the middle of 2017.

Continuing the payroll tax holiday and the extended unemployment insurance benefits will thus accelerate the return to a healthier economy no longer held back by crushing middle-class debt burdens.

It’s important to point out that this income growth will not happen fast enough on its own. Income growth generally comes from job creation for most households. But economic growth is currently too slow to create a lot of jobs. As I mentioned earlier, businesses are holding back on investment and hiring since they can fill their slowly growing orders with much of their existing capacity. Economic growth and job creation stay low as a result, further holding back household-debt reduction, consumption, and investing. At this point only policy interventions to boost after-tax income can break this vicious cycle.

In short, strengthening middle-class after-tax incomes with the tax holiday is both expedient and efficient in returning the U.S. economy and the labor market to better health.

Christian E. Weller is an associate professor, department of public policy and public affairs, University of Massachusetts Boston, and Senior Fellow, Center for American Progress, Washington, D.C.

Endnotes

[1] Author’s calculations based on Bureau of Economic Analysis, “National Income and Product Accounts” (2011).

[2] Ibid.

[3] Ibid.

[4] Author’s calculations based on Board of Governors, Federal Reserve System, “Release Z.1 Flow of Funds Accounts of the United States” (2011).

[5] Ibid.

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Reid: GOP Proves That They Care About Partisanship, Not Pipeline

2011-12-13T13:26:00.003-05:00

By tying legislation to force approval of a controversial pipeline to a bill to extend middle-class tax cuts, Republicans have proven their real aim is merely to embarrass President Obama, according to Senate Majority Leader Harry Reid.

Republicans don't actually care whether the 1,700-mile Keystone XL pipeline becomes reality at all, the Nevada Democrat charges.

The House is expected to vote Tuesday on legislation which would extend Obama's payroll tax cut for 160 million Americans, but also would force the president to act on the $7 billion pipeline from Canada to the Gulf Coast.

Taxes will rise on American workers starting in 2012 unless Congress acts by the end of the month to extend the tax cut. Republicans, who historically have been eager about tax cuts, have been less-than-enthusiastic over Obama's tax cut.

Obama delayed action on the Keystone pipeline last month until 2013 in order to give the project further review.

The independent inspector general of the State Department is investigating the process by which the pipeline was considered. Many on the left, including Sen. Bernie Sanders (I-Vt.), have charged that the approval process already has been overly influenced by corporate lobbyists.

The State Department must give its blessing to Keystone XL because the project would cross the U.S. border.

(You can read an overall explanation of the Keystone XL project, and its controversies, online here.)

Reid quotes Rep. Jim Jordan of Ohio, the chairman of the conservative Republican Study Committee, as saying of the Keystone XL pipeline: “Frankly, the fact that the President doesn’t like it makes me like it even more.”

However, the truth is that Obama has not come out against the pipeline, Reid says.

"That’s not true. He believes it’s an important proposal that deserves proper review," Reid says. "And, as Secretary of State Clinton said yesterday, if Republicans push him to make an uninformed decision in three months – as this legislation would – he will be forced to deny the permit. If Republicans push this through, the pipeline is bound and doomed to failure."

Republicans, and their unlikely allies in organized labor, are pushing hard to approve the pipeline under the guise of job creation. However, the State Department has found that the pipeline would create between 5,000 to 6,000 temporary construction jobs but only 20 permanent jobs.

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Enviro Group: By Forcing Riders, Republicans Breaking Their Own 'Pledge To America'

2011-12-13T05:18:00.004-05:00

By pushing a number of unrelated policy riders on spending bills and other key legislation, Republicans are breaking one of the promises they made to voters which helped them take control of the House of Representatives, a spokeswoman for a Washington environmental group charges.

By attaching conservative policy provisions on "must-pass legislation," Republicans have broken their own "Pledge to America," a list of promises they issued ahead of the 2010 midterm elections which turned the House back to GOP control. The pledge was modeled after the earlier "Contract for America" which Republicans used in 1994 to win control of Congress.

The so-called policy riders congressional Republicans are pushing include rollbacks of environmental regulations attached to spending bills required to avoid a potential government shutdown. They also include a provision to approve a controversial transnational oil pipeline attached to a bill to extend middle-class tax cuts.

"The flip-flopping House Republicans got it right the first time. In their much-ballyhooed 'Pledge to America’ in September 2010, they vowed to 'end the practice of packaging unpopular bills with ‘must-pass’ legislation.’’ Such extraneous riders, they correctly noted, would 'circumvent the will of the American people,'" says Suzanne Struglinski of the Natural Resources Defense Council, which opposes the pipeline and other Republican-led environmental policy riders.

"Sadly, they now are singing a different tune. Instead of taking up major legislation one issue at a time, as they promised, this week the same lawmakers are larding up a must-pass spending bill and a tax relief measure with riders designed not for the public weal but for the benefit of special interests," Struglinski adds. "The growing laundry list of anti-environmental riders includes one that would force a premature judgment on the Keystone XL tar sands pipeline, another that would block the Environmental Protection Agency from updating public health protections against mercury emissions and carbon dioxide pollution from power plants, and one that would weaken the Endangered Species Act."

House Republicans are preparing to vote Tuesday on legislation which would tie the extension of President Obama's payroll tax cut for the middle class with forced approval of the plan to build the 1,700-mile Keystone XL pipeline from Canada to the U.S. Gulf Coast.

The pipeline could threaten an aquifer much of Nebraska uses for clean drinking water.

(You can read an overall explanation of the Keystone XL project, and its controversies, online here.)

The State Department must give its blessing to Keystone XL because the project would cross the U.S. border.

To the outrage of both Republicans and many in organized labor, Obama delayed approval for the pipeline last month until 2013. The independent inspector general of the State Department is investigating the process by which the pipeline was considered.

Many on the left, including Sen. Bernie Sanders (I-Vt.), have alleged undue lobbying influence on the process.

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NPR Poll Shows Long-Term Unemployed Desperate for Work

2011-12-13T04:09:00.001-05:00

This article was published by the Center for American Progress.

By Sarah Jane Glynn

There’s never a good time to be involuntarily unemployed. But today’s conditions are among the worst in decades. For every new job created there are four people looking for work. With supply and demand this out of whack, it is not surprising that the average length of unemployment for a worker who loses his or her job is a little more than 10 months. But in the midst of this troubling scenario, House conservatives are proposing that the government should reduce the length of time people can collect unemployment insurance by 40 weeks.

A recent poll of the long-term unemployed, conducted by National Public Radio and The Kaiser Family Foundation, illustrates how disastrous being out of work in this economy can be, and the lengths people would be willing to go to find a new job:

Seventy-four percent of the long-term unemployed have a negative outlook on their financial situation, and more than 60 percent are not confident they will be able to find a job that will provide them with the pay and benefits they need to get by.
Only 22 percent of the long-term unemployed are currently receiving unemployment benefits. Among those who are, a full 94 percent think it is at least somewhat likely that their benefits will run out before they are able to find a new job. These fears are not unfounded. Among those who had previously received unemployment benefits but currently were not, 84 percent stopped getting them because they ran out.
A majority of the unemployed would be willing to go to great lengths in order to find work. Eighty-seven percent would take an entry-level job in a different field, 68 percent would be willing to take a pay cut from their last job, and 44 percent would be willing to pack up and move to a new state if it meant that they would be able to find employment.

These findings echo what economists have been saying for some time now. The long-term unemployed are desperate to find work, their benefits are running out, and something needs to be done to assist them in this tough economy.

Nonetheless, conservative lawmakers such as Sen. Jon Kyl (R-AZ) have argued that unemployment benefits discourage the unemployed from seeking work “because people are being paid even though they are not working.” This is not only a contradictory statement—because an individual must be actively seeking work in order to qualify for unemployment insurance—but it is also factually inaccurate according to recent research.

Jesse Rothstein, former chief economist at the Department of Labor and current professor of public policy and economics at UC Berkeley, recently released a paper that directly contradicts Sen. Kyl’s assertion. While some researchers have argued that extensions to unemployment insurance have contributed about 2.7 percentage points to the unemployment rate, Rothstein found that extending benefits to unemployed workers only raised the unemployment rate by approximately 0.3 percentage points. Less than half of this tiny effect was because people did not become re-employed, and there’s reason to believe that “the availability of extended benefits might have raised reemployment rates of displaced workers, by keeping them from abandoning their searches prematurely.”

Let’s be clear: Maintaining unemployment insurance doesn’t discourage a worker from finding employment again, and it can help some workers who are currently employed stay that way. Businesses cannot hire new workers unless there is demand for their services. People who are receiving unemployment insurance are more likely to spend the money they receive than save it, which means they are putting money back into local economies and supporting the jobs of their community members. For every $1 paid out in unemployment benefits, the economy grows by $2.

There are currently 13.3 million unemployed people looking for work in the United States, and 7.1 million are receiving unemployment insurance. A reduction in those benefits would not only spell further financial disaster to the individuals directly but would also further dampen the economic recovery of our nation as a whole.

Sarah Jane Glynn is a Policy Analyst at the Center for American Progress.

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