Progressive Breakfast: $100B For Jobs In New WH Budget

Each morning, Bill Scher and Terrance Heath serve up what progressives need to affect change on the kitchen-table issues families face: jobs, health care, green energy, financial reform, affordable education and retirement security.

$100B Jobs Plan In New White House Budget

Obama FY 2011 budget proposal released today, includes jobs initiative smaller than House version, bigger than Senate. NYT: "Mr. Obama’s proposed $100 billion stimulus package, which includes tax credits for small businesses that make new hires and money for infrastructure projects, is less than a $154 billion package that the House approved in December but more than a measure the Senate is drafting."

Politico reports Sen. Baucus slowing down jobs bill process in hopes of reducing scope: "...Democrats say they are starting to coalesce around a hodgepodge of ideas, including one by Sens. Chuck Schumer (D-N.Y.) and Orrin Hatch (R-Utah) to create a Social Security tax break for employers who hire unemployed workers; 'Build America' bonds for infrastructure; extensions of COBRA and unemployment insurance and money for energy-efficient projects. And Democrats may add versions of a proposal, outlined by President Barack Obama, to give tax credits to small businesses for hiring and pay increases ... Dorgan and Durbin have advocated an $82 billion plan ... $75 billion would be paid for by the banks that are returning [TARP] funds ... Baucus advocated a more scaled-back plan, and the emerging bill ... now will carry a price tag far less than $80 billion, several sources said Friday."

600,000 jobs created in final quarter of 2009, meets stimulus target, reports W. Post, though WH now refraining from trying to estimate number of jobs "saved."

President proposes extension of "Build America Bonds" program, with reduced subsidy. Reuters: "...the $2.7 trillion municipal bond market was at a standstill, a victim of the credit crunch. State and local governments rushed to issue the bonds, which were designated for infrastructure, mere months after the American Recovery and Reinvestment Act was signed into law. By the end of 2009, issuers had sold more than $60 billion and analysts estimate more than $100 billion BABs could be sold this year. In Obama's proposal, the bonds will be expanded to refinance some debt, to cover short-term governmental operating costs and to finance non-profit hospitals and universities."

What Gets More Investment? What Gets Cut?

WH flashes its "scalpel," but details limited on cuts ... so far. NYT "...officials said, they have taken “a scalpel” to cut or eliminate more than 120 programs, while increasing money for priorities — chiefly education, research and energy programs — to save about $20 billion in the 2011 fiscal year."

NASA budget tightens. LAT: "Obama, for example, proposes to cut funding for NASA programs that were supposed to send astronauts to the moon by 2020 and replace the space shuttle with a new rocket. Instead, he will direct the agency to concentrate more on Earth science projects, such as researching and monitoring climate change."

What happens to the Bush tax cuts? NYT: "Budgets for 2011 and beyond also would save hundreds of billions of dollars by letting the Bush-era tax cuts for households that have annual incomes above $250,000 expire this year as scheduled. Mr. Obama’s proposed tax on big banks, intended to recoup any losses from the financial bailout program, would collect at least $90 billion over a decade."

More middle-class tax cuts and aid to states. AP: "Obama's new budget proposed extending the popular Making Work Pay middle-class tax breaks of $400 per individual and $800 per couple through 2011. They were due to expire after this year. The budget also proposes making $250 payments to Social Security recipients to bolster their finances in a year when they are not receiving the normal cost-of-living boost to their benefit checks because of low inflation. Obama will also seek a $25 billion increase in payments to help recession-battered states."

Pell grant boost for college students. AP: "Federal support for elementary and high school education would get a big increase as would the Pell Grant college tuition program, which would see an increase of $17 billion to just under $35 billion, helping an additional 1 million students, according to an administration official who spoke on grounds of anonymity before the budget was released."

Increased investment in women and girls. McClatchy: "Among the programs targeted at women are $8.1 billion in food aid for low-income pregnant women, infants and children up to 5 years old and $3.9 billion for child care and Head Start meals. It also will increase by $10 million money set aside for family planning efforts, raising the total to $327 million, including $205 million for the prevention of teen pregnancy, the rate of which has increased after a decade of decline. The budget also will propose spending $535 million in aid for victims of domestic violence — $117 million more than current funding, a 22 percent increase."

WH trying to show long-term fiscal restraint. NYT: "The president and his budget director, Peter R. Orszag, have signaled in recent weeks that the budget, after this year, will show the government on a path to lower deficits because of a combination of renewed economic growth and Mr. Obama’s proposals for increasing tax revenues and cutting spending. The president’s shift from stimulus spending to deficit reduction in his new budget for the 2011 to 2020 fiscal years assumes that the economy will have fully recovered from the worst recession in eight decades."

Was There A Health Care Deal?

Sen. Harkin says a deal was reached before MA election. House aide disputes. The Hill: "Harkin said 'we had an agreement, with the House, the White House and the Senate. We sent it to [the Congressional Budget Office] to get scored and then Tuesday happened and we didn’t get it back.' He said negotiators had an agreement in hand on Friday, Jan. 15. ... Harkin said the deal covered the prescription-drug “donut hole,” the level of federal insurance subsidies, national insurance exchanges and federal Medicaid assistance to states ... A House Democratic aide, however, said not all the issues were resolved. A final healthcare deal is crucial because it could serve as the basis for a sidecar bill that could pass through the House alongside the Senate-passed healthcare bill."

Kevin Drum befuddled: "...if negotiations really were complete, it should mean that creating a reconciliation deal to accompany passage of the existing Senate bill ought to be fairly easy ... Why this isn't happening is a mystery."

LAT reports health care negotiations continue daily: "Many have concluded that the only hope for resuscitating the healthcare legislation is to push the issue off the front page and give lawmakers time to work out a new compromise and shift public perception of the bill ... Democratic leaders hope to agree on a procedural path forward by the end of this week."

WH press sec avoids direct answer on question about scaling back bill. CNN: "...Gibbs was noncommittal when asked if Obama was considering breaking the health care bill into smaller measures that might be able to gain bipartisan support. 'I don't think we know yet the answer on the process of this,' Gibbs told CNN."

Financial Industry Backed Scott Brown, Prepared To Spend More To Kill Reform

Boston Globe reports that financial industry contributed heavily in Mass. Senate race to block Obama's reform plans: "In a six-day span just before the US Senate election, Republican Scott Brown collected nearly $450,000 from donors who work at financial companies, a sign the industry is prepared to spend heavily in the upcoming midterm elections to beat back new controls and taxes President Obama wants to impose ... The Financial Services Roundtable, one of the industry’s most influential groups in Washington, has been increasingly vocal in opposing [the House financial reform bill] ... its chief lobbyist, Scott Talbott, said both donations and activity have picked up more recently..."

Small business owners defy business lobby, back financial reform, in new Main Street Alliance poll. OurFuture.org: "The Main Street Alliance, a coalition of business owners in 15 states, released a poll of more than 1,200 small business owners in late January in which 69 percent of the business owners surveyed said they supported Congress passing 'strong financial reforms' and another 67 percent said they supported the creation of a financial consumer protection agency.'"

Three NY House members looking out for Wall Street, write Obama to stop bank tax plan. WSJ: "A letter sent to the president and signed by two Democratic and one Republican lawmaker warns that the tax could have a 'crippling effect on New York’s economy.' ... The three warn that the tax could result in banks moving to more tax-friendly places, potentially costing New York much-needed tax revenues."

$100M bonus to Goldman Sachs CEO? Times of London: "Goldman Sachs, the world’s richest investment bank, could be about to pay its chief executive a bumper bonus of up to $100 million in defiance of moves by President Obama to take action against such payouts ... Goldman declined to comment, but the bank will reveal the pay of its top five earners in a filing with America’s banking regulator the Securities and Exchange Commission by the end of next month." (via Political Wire)

High-risk derivatives trading at AIG raising question about financial reform impact on insurance industry. NYT: "Though the Delaware division had a much smaller portfolio of those swaps than the London unit, and its portfolio did not pose a similar risk to the world financial system, the very presence of the swaps in a regulated insurance company points to a weakness in insurance oversight. There is a continuing dispute over whether such swaps are insurance products or something else; who, if anyone, should regulate them; and whether insurers should have to set aside reserves to secure the promises that swap contracts make ... The House has already passed a measure that would create a national office to gather information on insurance but would leave insurance regulation to the states."

TARP inspector general finds bailout cost less than expected, but warns of "moral hazard" without reforms. Bloomberg: "Barofsky’s quarterly audit is more upbeat about the program’s near-term prospects to recoup taxpayers’ money than an October report in which he said the final cost could be 'substantial.' ... 'Even if TARP saved our financial system from driving off a cliff back in 2008, absent meaningful reform, we are still driving on the same winding mountain road, but this time in a faster car,' the report said."

WH Pushes Nuclear Button To Save Climate Bill

AP analyzes WH hard sell on nuclear: "President Barack Obama is endorsing nuclear energy like never before, trying to win over Republicans and moderate Democrats on climate and energy legislation. Obama singled out nuclear power in his State of the Union address, and his spending plan for the next budget year is expected to include billions of more dollars in federal guarantees for new nuclear reactors ... He's now calling for a new generation of nuclear power plants. During the campaign, Obama said he would support nuclear power with caveats. He was concerned about how to deal with radioactive waste and how much federal money was needed to support construction costs. Those concerns remain; some say they've gotten worse ... Energy Secretary Steven Chu has been criticized for his slow rollout of $18.5 billion in loan guarantees to spur investment in new nuclear power plants, and the administration killed a Bush-era proposal to reprocess nuclear fuel. What has changed is the outlook for climate and energy legislation..."

Nuclear power boost in WH budget. Bloomberg: "On energy, the administration supports expanding nuclear power by tripling loan guarantees for new reactors to more than $54 billion, an administration official said. The 2011 budget will add $36 billion to the $18.5 billion already approved for nuclear-power plant loan guarantees."

Sen. Lindsey Graham stresses need for price on carbon at Davos. Climate Progress: "''Every day that we delay trying to find a price for carbon is a day that China uses to dominate the green economy,' [says Sen. Graham] ...what is most amazing about the emergence of the conservative senator from South Carolina as a leader on climate and clean energy is that he is clearly better at messaging on this than most progressives, possibly even including the president. Why?"

Progressive Reaction To Obama/House GOP "Question Time"

Booman Tribune sees "Question Time" tactic as key to persuading public:: "I can honestly say that if as many Americans watched today's Q & A with the Republicans as watched the State of the Union, our political problems would be over. If we had Question Time, we'd have a much easier time winning over public opinion and sustaining support for progressive policies. The Republicans certainly will not want to repeat this extremely painful beat-down"

Digby doubts enough will pay attention to nuanced debate, critical of bipartisan focus: "...I remain concerned that the message is not as clear to the rest of the country as his supporters think it was ... I watched Clinton do this type of thing over and over again and it didn't change the dynamic at all ... I think people see Obama conceding that he hasn't been bipartisan enough and that he intends to keep trying. And that will never be a winner for our side because all the Republicans have to do is continue to obstruct to prove him a failure."

Matt Ygelsias still wonders what conservatives want to actually accomplish in governing:: "I guess I don’t really understand what it is that the GOP has a great opportunity to do. The viewthey’re articulating at the moment is that (a) the deficit should be lower, (b) taxes should be lower, (c) Medicare shouldn’t be cut, (d) defense spending should be higher. With unemployment at 10 percent, this is a somewhat potent political message that helped them become only slightly less popular than the other party. That’s a huge improvement from where they were 18 months ago. But it’s not a governing agenda. What would they do if they took over?"

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