While Obama's proposed budget will hit Bush hard in the wallet, just like other wealthy Americans, the main blow may be aimed at his reputation.
The 134-page spending plan opens with a 10-page preamble entitled "Inheriting a Legacy of Misplaced Priorities" that lays blame for many of today's problems at the doorstep of the former president.
"It is no coincidence that the policy failures of the past eight years have been accompanied by unprecedented Governmental secrecy and unprecedented access by lobbyists and the well-connected to policymakers in Washington. Consequently, the needs of those in the room trump those of their fellow citizens," the plan says.
But others get blamed in a broad-brush condemnation: "For the better part of three decades, a disproportionate share of the Nation's wealth has been accumulated by the very wealthy," the budget says. It blasts "a legacy of irresponsibility," adding, "It's our responsibility to change it."
Bobby Jindal and the perils of excessive folksiness
Jindal's folksy response to Obama, in which he calls himself a "pre-existing condition."
I know everyone wants to talk about President Obama's powerful performance last night in his non-SOTU SOTU address, but sorry, I just can't get Bobby Jindal's response out of my mind. Yes, yes, it was problematic in that it lacked specific remedies to our economic woes that could confer credibility on the party out of power or make America want to give the GOP another chance at leadership, which is the essential critique over at The Moderate Voice. Sure, it's insane and nihilistic, as David Brooks put it, to simply stand there and say "no, no, NO, let the country crash and burn while we pray for better days!" And yep, it "stunk on ice" in terms of delivery, as this booty-obsessed GOPer opined (one Republican strategist said watching Obama then Jindal was "like watching the Rolling Stones open for Air Supply." Ouch!) But WHY did it stink so badly?
In short: it's the GOP's obsession with appearing to be "just folks." They can't get enough of it. The party that since the late 19th century has represented big business, from Standard Oil to Halliburton to Lehman Brothers, has so denuded itself of a middle class message, that it is left to panhandle for lower middle class white voters in Appalachia and the rest of the NASCAR circuit. How to do it? By trying to marry the interests of poor whites to the interests of rich whites. Somewhere along the line, the GOP decided that the way to do that was to feign a king of false populism -- an "us against them" brocade that pits "real Americans" -- hardscrabble, indepedent folks who don't want no darned Social Security (as Joe the Plumber bravely asserted during the campaign) and don't need no government welfare disguised as "stimulus money" ... even though the states they live in are, to a one, net welfare states that take in more federal money than they pay in taxes.
The incredible trick of getting poor people to stand up for the rights of the rich -- sort of like getting the masses to storm the Bastille on behalf of Marie Antoinette -- is a neat one, performed in large part thanks to the repeal of the Fairness Doctrine, which allowed people like Rush Limbaugh to own AM radio, a key transmitter of information to folks who still use rabbit ears on their television sets and prefer huntin' and fishin' to reading a newspaper.
The other way the GOP operates, is to create these characters -- people whose backgrounds suggest wealth, success and sophistication: a self-made governor of Alaska; a Rhodes Scholar, first generation American, 37-year-old governor of Louisiana; even the son of a president -- but whose demeanor suggests "aw, shucks, fellers, ahm just lahk you!" George W. Bush, Yale graduate, male cheerleader and scion of great wealth, purchased a ranch in Crawford just before running for president. Immediately upon leaving office? He and Laura moved into an exclusive, comfortable neighborhood of Dallas that had racial covenants in place just a few years ago. Nobody knows how intelligent Sarah Palin actually is, but during the campaign she came off as a cross between Ellie Mae Clampett and Donna Reed. Michael Steele, a former lieutenant governor Maryland, and now the Official Black Man of the 99 percent white Republican Party, feels the need to drop the word "baby" at the end of every sentence, and promises to give his party a "hip-hop makeover." And now, there's poor Bobby Jindal, an impressive man, if you read his resume, but whose demeanor and delivery last night were so stilted and ... hell ... just plain wierd ... that he has ensured only one thing: a cameo on South Park. Other than that? 2012 is a wash.
Watch: Bobby Jindal's Country Bear Jamboree:
Democrats have their folksy characters, too. Bill Clinton, who like Jindal was a Rhodes Scholar, is as folksy as they come. And even Barack Obama comes across as a purely suburban Mr. Rogers, which was part of his appeal to white voters. But both of these men were and are unafraid to flaunt their intellectual heft and command of policy. Meanwhile, the so-called "conservatives" of the GOP exhibit a disdain for anyone who sounds too smart or educated (essentially telling their least educated voters, "see, that guy thinks he's better than you...) And it seems, the Grand Old Party has developed a total aversion to actual ideas. Instead, what they're selling is the old salt of tax cuts, tax cuts, tax cuts! ... coupled with this strange, "aw shucks" pandering to a shrinking database of voters in a confined geographic area, and at a long-term demographic disadvantage. (Steele is even hinting that his RNC will sabotage the re-elections of the last remaining northeastern GOP Senators, as if a far right candidate could possibly win in Pennsylvania or Maine today.)
Unfortunately for the GOP, as one of the few authentic folksy guys in the party -- Mike Huckabee, who was rejected by the leaders of the right wing revolution -- might say, "that dog won't hunt." Not when most Americans realize that we desperately need more education, more intellectual curiosity, and less pandering to the lowest common denominator, in order to move the country forward.
The federal dole: the common denominator in GOP stim opposition
Let's see... our folksy friend Bobby Jindal doesn't want the stimulus money ... nor does the equally folksy Sarah Palin of Alaska, Mark Sanford of South Carolina, Tim Pawlenty of Minnesota, Haley Barbour of Mississippi, Sonny Perdue of Georgia, and even some Democrats, like Phil Bredeson of Tennessee. Most of them say they only object to giving their unemployed residents increased benefits. But since they have now been informed by Chuck Schumer that it's "all or nothing," perhaps some of them will stand by their "conservative principles" and not take any of the dough.
Still, as many observers, including political scientist Larry Sabato, have said, it would be a lot easier to listen to that kind of fiscal "discipline" from people who weren't feeding so heartily at the federal trough. Because see, it turns out, the states that are turning up their noses at the federal dollars Obama is offering, happen to also be the states sucking down far more federal pork than, say, Florida, Michigan, New York or California, which send more taxes to D.C. than they get back (and where the governors have said, "yes, please show us the money."
According to the Tax Policy Center, here's how the numbers shake out, in terms of dollars received per dollar of taxes paid, in the latest year they have records for, 2005 (states where governors or Senators have taken a yay or nay position on the stimulus in bold*)
President Obama's address to Congress and the American people tonight is being described as Reaganesque. I think it was more FDR than Reagan, but there you go. He made clear the challenges we face (the "day of reckoning" part.) but promised the nation that we will recover. So far, the reviews are great. From the AP:
WASHINGTON – President Barack Obama gave America the audacity to hope again.
After describing the U.S. economy in nearly apocalyptic terms for weeks, pushing his $787 billion stimulus plan through Congress, the president used his address to Congress on Tuesday night to tap the deep well of American optimism — the never-say-die spirit that every president tries to capture in words. And great presidents embody.
"We will rebuild. We will recover, and the United States of America will emerge stronger than before," Obama said, echoing Franklin Delano Roosevelt and Ronald Reagan.
"The answers to our problems don't lie beyond our reach," Obama said. "What is required now for this country is to pull together, confront boldly the challenges we face, and take responsibility for our future once more."
The themes of responsibility, accountability and, above all, national community rang throughout an address carefully balanced by the gravity of its times. Job losses. Home foreclosures. Credit crisis. Rising health care costs. Declining trust in government. Obama touched all those bases.
From the White House press office: excerpts of President Obama's speech tonight:
We have lived through an era where too often, short-term gains were prized over long-term prosperity; where we failed to look beyond the next payment, the next quarter, or the next election. A surplus became an excuse to transfer wealth to the wealthy instead of an opportunity to invest in our future. Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn’t afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day.
Well that day of reckoning has arrived, and the time to take charge of our future is here.
On the stimulus bill and his soon to be dropped budget:
The recovery plan and the financial stability plan are the immediate steps we’re taking to revive our economy in the short-term. But the only way to fully restore America’s economic strength is to make the long-term investments that will lead to new jobs, new industries, and a renewed ability to compete with the rest of the world. The only way this century will be another American century is if we confront at last the price of our dependence on oil and the high cost of health care; the schools that aren’t preparing our children and the mountain of debt they stand to inherit. That is our responsibility.
My budget does not attempt to solve every problem or address every issue. It reflects the stark reality of what we’ve inherited – a trillion dollar deficit, a financial crisis, and a costly recession.
Given these realities, everyone in this chamber – Democrats and Republicans – will have to sacrifice some worthy priorities for which there are no dollars. And that includes me.
But that does not mean we can afford to ignore our long-term challenges. I reject the view that says our problems will simply take care of themselves; that says government has no role in laying the foundation for our common prosperity.
Schumer to Jindal and Company: take it or leave it
The stimulus package is not an a la carte buffet, Bobby Jindal. Chuck Schumer informs the GOPers that if they don't want all of the money, they needn't take any of the money.
By the way, a Youtube commenter asks a salient question: since when is helping the unemployed "pork?"
Barney Frank added to the hardball tonight ... er ... on "Countdown" by mocking the Republican Naysaying governors by saying "some people define courage as a willingness to endure the suffering of others." He then asks what's with Jindal "denying working people who've lost their jobs through no fault of their own" unemployment benefits. He concludes: "if that's political courage, I hope they have more cowardice."
As you know, Section 1607(a) of the economic recovery legislation provides that the Governor of each state must certify a request for stimulus funds before any money can flow. No language in this provision, however, permits the governor to selectively adopt some components of the bill while rejecting others. To allow such picking and choosing would, in effect, empower the governors with a line-item veto authority that President Obama himself did not possess at the time he signed the legislation. It would also undermine the overall success of the bill, as the components most singled out for criticism by these governors are among the most productive measures in terms of stimulating the economy.
For instance, at least two governors have proposed rejecting a program to expand unemployment insurance for laid-off workers. Economists consistently rank unemployment insurance among the most efficient and cost-effective fiscal stimulus measures; by one frequently cited estimate, it provides an economic return of as high as $1.73 for every dollar invested. Thus, by denying this provision for their residents, these governors are not just depriving some of the neediest Americans of relief in a dire economy; they are undermining the overall stimulative impact of the package.
So go ahead, Bobby. Reject the money. I double dare you...
A new ABC/WaPo poll puts the president's approval rating at 68 percent. The GOP? Not so much.
Compared, the approval ratings fall this way:
President Obama - 68% Democrats in Congress - 50 Republicans in Congress - 38 (wah wah waaaaahhhhh....)
And the Post writes:
Overall, 68 percent of poll respondents approve of Obama's job performance, a finding that puts him on par with the average for the past eight presidents at this point in their tenures. Ninety percent of Democrats and 67 percent of independents approve of Obama's performance. Sixty-four percent said they approve of how Obama is handling appointments to the Cabinet and other top positions in the administration, despite tax problems and stumbles that have led to three of his top nominees withdrawing from consideration.
Although Obama has encountered near-unanimous GOP opposition to his stimulus plan in Congress and widespread criticism for a housing bailout plan that some say rewards people who have been fiscally irresponsible, 64 percent of those polled back the economic recovery package, and the same percentage support the mortgage proposal. The broad support for the recovery package comes as just 10 percent said the bill was too heavy on spending and too light on tax cuts, the primary contention of the Republican leadership in Congress.
Overall, 60 percent of poll respondents approve of how Obama is dealing with the economy.
About nine in 10 Democrats and seven in 10 independents said Obama is living up to the central promise of his campaign: bringing change to Washington. Most Republicans said he is not.
Half of all poll respondents said they approve of how congressional Democrats are doing their jobs, up 15 points from July and the highest marks they have received in nearly two years. Congressional Republicans also are being viewed more favorably, with 38 percent approving of their job performance, a 13-point improvement since the middle of last year.
Head to head, though, Americans put far more faith in Obama than in congressional Republicans: Sixty-one percent said they trust Obama more than the GOP on economic matters; 26 percent side with the Republicans in Congress. On that question, Obama's advantage is bigger than George W. Bush, Bill Clinton or George H.W. Bush ever had over the opposition party in the legislature.
Overall, Democrats maintain an edge of nearly 2 to 1 over Republicans as the party that Americans prefer to confront "the big issues" over the next few years.
Santelli's scared... or: some revolutionary HE turned out to be
Um ... who could possibly be afraid of Robert Gibbs? Answer: Rick Santelli, the Bourgeois Baron himself, and would-be leader of the Chicago Tea Party. Now, our friendly neighborhood "real American" Wall Street capitalist says he's terrified ... terrified, I say! ... of the guv'ment:
A new CBS News/New York Times poll finds broad support for President Obama's mortgage rescue plan, though you wouldn't know it from CBS News' headline:
Poll: Public Wary Of More Bailouts
Really? Sounds grim (and this from the new home of an extremist like this.) But let's read on...
As President Obama pushes a $75 billion mortgage relief plan, sixty-one percent of those surveyed say the government should help homeowners, while just 20 percent oppose such help.
Hm... that doesn't match the headline...
But while 35 percent say Mr. Obama’s plan makes them feel relieved for people facing foreclosure, just as many are resent the beneficiaries of the program for needing to be rescued following what respondents see as irresponsible behavior.
Let's examine that, shall we? In the actual poll, rather than the story, 61 percent indeed say homeowners should be helped. But that includes 47 percent of Republicans (with just 31 percent opposed) and 59 percent of Independents, with just 24 percent opposed. Democrats approve of helping struggling homeowners by a wider 73-9 percent. As for resentment, the poll reads this way:
OBAMA’S PLAN TO AID HOMEOWNERS MAKES YOU FEEL… Relieved for people facing foreclosure 35% Resentful of irresponsible homeowners 35 Don’t know enough about plan yet 26
Not sure that means Americans are "increasingly resentful." It means that about one-third each feel relieved or resentful. Not exactly "public wary of more bailouts." What the poll does find is that a majority of Americans don't want to hand more money to banks: just 39 percent approve of that idea, versus 50 percent who disagree. The reason? 57 percent don't believe that giving money to the banks, who aren't lending the money (and who may actually be hiding it...) will help the economy.
On the other hand, a majority of Americans do oppose bailouts to corporate entities and banks, in other words, to the people they perceive as the villains in the economic collapse. Per CBS:
Fifty-nine percent say President Obama’s proposal to help banks would only help bankers, not all Americans.
There is widespread support for the president and Congress’ efforts to cap executive pay: Eighty-three percent say the government should limit executive salaries if companies get federal money. Just 11 percent say it should not.
Americans are even less supportive of a further bailout for the U.S. auto industry. (Automakers have already received loans from the government but say they may need more money to avoid bankruptcy.) Just 22 percent say the government should give more money to automakers, while 68 percent oppose any further aid.
But guess who isn't seen as the villain? That would be Barack Obama:
One month into his term, President Obama’s overall approval rating remains favorable, with 63 percent of Americans approving of the job he is doing as president. The figure is similar to the approval rating he received earlier this month.
Seventy-six percent of Americans are confident in Mr. Obama’s ability to make the right decisions about the economy, including nearly a third who are very confident.
More than half of Americans also approve of President Obama’s handling of foreign policy (57 percent) and Iraq (54 percent).
And 77 percent are optimistic about the next four years with Mr. Obama as president, including 57 percent of Republicans.
Meanwhile, the public appears to be tiring of the Republican political stunt-making when it comes to reviving the economy, and they are increasingly seen as partisan and obstructionist:
While the percentage of Americans who believe the president is trying for bipartisanship has slipped seven points from earlier this month, 74 percent still think he is trying to be bipartisan.
By contrast, just 45 percent say Congressional Democrats are trying to be bipartisan and 31 percent say Congressional Republicans are trying to do so.
Most of those surveyed say Republican opposition to the stimulus bill - it passed with the support of no House Republicans and just three Senate Democrats - results from politics.
Sixty-three percent say GOP opposition was for political reasons, while 29 percent say it was because the stimulus bill would be bad for the economy.
Americans say Mr. Obama should focus more on his positions than reaching across the aisle. Fifty-six percent say he should prioritize sticking to his policies, while just 39 percent say he should put bipartisanship first. Seventy-nine percent, however, say Congressional Republicans should prioritize bipartisanship.
In other words: throw the Republicans overboard. Back to the stimulus bill: the exact numbers are as follows:
IMPACT OF STIMULUS BILL ON ECONOMY (will make things) Better 53% Worse 13 No impact 24
And Americans have realistic expectations:
STIMULUS BILL’S EFFECT ON LENGTH OF RECESSION Will shorten significantly 19% Will shorten, not significantly 17 Will not shorten 50
Most of those surveyed assumed Obama's plans would improve the economy in 2 to 4 years.
BTW, the GOP has caught onto the public mood, and even Bobby Jindal was bending over backward to sound "bipartisan" during the governors' news conference today. Too late, my friend.
Ideology first: Jindal fires the first shot for 2012
Per ThinkP - Louisiana Gov. Bobby Jindal just says no to $100 million in stimulus money for unemployed residents of his state. Now THERE's a great way to improve his changes of getting the 2012 GOP presidential nomination by ... ensuring he is not re-elected governor of Louisiana???
And other Republican governors are preparing to follow suit, even as the White House goes around their colleages in Congress, dealing directly with more amenable governors and mayors. But can someone explain how punishing the people of one's state improves a politician's political fortunes? The GOP has caught itself in a hell of a trap: they can either be hypocrites and beg for the money they voted against, or be ideologues and hurt their own constituents.
Robert Gibbs fires back at the Bourgeois Baron (Rick Santelli)
Rick Santelli thinks the guys on Wall Street and the Chicago Mercantile Exchange are the "real America" (as opposed to the "losers" who are out here getting themselves unemployed, getting sick, losing their healthcare and losing their homes ... losers...) Well, just watched Robert Gibbs' presser and apparently, the Obama White House begs to differ...
I’ve watched Mr. Santelli on cable the past 24 hours or so. I’m not entirely sure where Mr. Santelli lives or in what house he lives but the American people are struggling every day to meet their mortgages, stay in their jobs, pay their bills, send their kids to school,” Gibbs said. “I think we left a few months ago the adage that if it was good for a derivatives trader that it was good for Main Street. I think the verdict is in on that,” the press secretary said, poking directly at the cable journalist, who reports from the trading floor at the Chicago Board of Trade.
Gibbs insisted Santelli was misinformed when he said Obama’s program would amount to a transfer of money from prudent taxpayers to those who had taken reckless risks.
“Mr. Santelli has argued, I think quite wrongly, that this plan won’t help everyone,” Gibbs said. “This plan helps people who have been playing by the rules….I would encouraged him to read the president’s plan….I’d be more than happy to have him come here to read it. I’d be happy to buy him a cup of coffee—decaf."
I wonder if Santelli has talked to Michelle Bachman. If not, he should. His band of brothers will soon be running low, since apparently we're running out of rich people. He may have to throw those derivatives into the Chicago River himself...
Meanwhile, Balloon Juice offers a sound rebuttal to Mr. Storm the Bastille (on behalf of Marie Antoinette...)
The most amusing thing to me about this Rick Santelli faux populist broker revolt is not his invocation of the Nixonian silent majority, but the utter lack of perspective it displays. Yes, there is a simmering discontent and anger out there, and clearly the Republicans are going to try to tap into it, but the problem for Santelli and his crowd is that the anger is not directed at the people who are losing their homes, but at the people Santelli spends every day rubbing shoulders with at the trendy Chicago restaurants the brokers go to these days.
The audacity of Santelli’s “revolt” is that a mere 75 billion is being spent to help struggling families repackage loans- a pittance in the terms of the gargantuan amount of money being thrown at the banks, the Wall Street wizards, and the rest of the rocket scientists who are the root of this problem.
Hello Santelli? The guys on that trading floor already got their bailout. And where were you when that happened?
Charlie Crist expects Florida to benefit from his support of the stim. And that's all well and good. He did lend critical Republican support to President Obama when he needed it, and Florida does need the cash. But what's with the nine House GOPers who voted against the bill, and who are now clamoring for stim cash for their districts??? Hm??? From Politico's Glenn Thrush:
We're getting into broken record territory here on Republicans clamoring for stimulus money.
Indeed. The nine co-signed a letter with nine Democrats (all of whom voted "yes" on the stim" asking for a waiver so that Florida can receive the dough. The letter read:
“This critical funding is vital to protecting our schools from budget cuts and teacher layoffs. Because Florida has been hit especially hard by a rise in foreclosures, unemployment, and recent natural disasters, we are experiencing a crippling budget crisis. Now more than ever, we must invest in our state’s future,” said the letter.
The Republican co-signers: Adam Putnam, Ileana Ros-Lehtinen, Lincoln Diaz-Balart, Tom Rooney, Mario Diaz-Balart, Ginny Brown-Waite, Cliff Stearns, John Mica and Bill Posey.
The Dems: Suzanne Kosmas, Ron Klein, Alcee Hastings, Robert Wexler, Debbie Wasserman Schultz, Kathy Castor, Kendrick Meek, Alan Grayson and Corrine Brown.
It should be noted that the Diaz-Balarts, Hastings, Meek and Wasserman Schultz are longtime allies, and even had a non-aggression pact that kept the Dems from campaigning against the Repubs during the last campaign. But this is just unseemly.
Why the need for the waiver? Um... it's the cuts to education spending, stupid... In other words, Florida's notorious, constant education cuts, dating back to the Jeb Bush era, are now biting us in the butt. Florida may get a break, because part of the problem is a significant drop in enrollment in the state's schools. But we shall see.
Remember the story of the little red hen? The one who refused to participate in gathering the wheat, threshing it, making the flour, mixing the mash or baking it up, but was right ready to partake in eating the bread? Apparently, the little red hen was a Republican.
First, the House GOPers and all but three Republican Senators voted "no" on the economic recovery bill. Then, of course, we all found out that some of those same wingers are sending out press releases touting the goodies in the bill for their home districts. Hm. Nothing new. Well now, some governors, having caught on to the irony, are trying to de-hen themselves by turning down stimulus money. The better to be ideologically consistent (truthfully, I'd like to see Arizona and other states whose delegations opposed the bill get nothing, and then let's see what happens in 2010...) But here's the catch: many of the Republican governors (of some of America's poorest states, by the way,) are considering saying no to the money, knowing their states will get it anyway.
U.S. Rep. James Clyburn, D-S.C., the No. 3 House Democrat, said the governors _ some of whom are said to be eyeing White House bids in 2012 _ are putting their own interests first.
"No community or constituent should be denied recovery assistance due to their governor's political ideology or political aspirations," Clyburn said Wednesday.
In fact, governors who reject some of the stimulus aid may find themselves overridden by their own legislatures because of language Clyburn included in the bill that allows lawmakers to accept the federal money even if their governors object.
He inserted the provision based on the early and vocal opposition to the stimulus plan by South Carolina's Republican governor, Mark Sanford. But it also means governors like Sanford and Louisiana's Bobby Jindal _ a GOP up-and-comer often mentioned as a potential 2012 presidential candidate _ can burnish their conservative credentials, knowing all the while that their legislatures can accept the money anyway.
The Obama homeowner plan will be unveiled today. Per the leaks, it's likely to contain substantial help for homeowners in trouble, which is great news for the economy (and the banks that got them there...) Says the WaPo:
President Obama will unveil today a $75 billion foreclosure prevention program, which the administration expects to reach up to 9 million homeowners.
"The plan I'm announcing focuses on rescuing families who have played by the rules and acted responsibly: by refinancing loans for millions of families in traditional mortgages who are underwater or close to it," Obama will say at a speech in Mesa, Ariz., according to an advance text released by the White House.
The Homeowner Affordability and Stability Plan includes measures to allow homeowners to refinance into loans with cheaper payments, according to a summary of the plan. For example, if a lender agrees to lower a borrower's payment so that it comprises no more than 38 percent of his income, the government would pay to lower the payments further to 31 percent of income. The aim would be to make the payments affordable.
The plan offers incentives for lenders that modify troubled loans, with up to $1,000 for each modification and then another monthly "pay for success" fee as long as the borrower stays current, according to the summary. If the lender reaches an at-risk homeowner before they miss a payment and modifies their loan, the lender would be eligible for another incentive payment.
Homeowners will also be eligible for incentive payments. Those that stay current on their loans could qualify for a "monthly balance reduction payment that goes straight towards reducing the principal balance of the mortgage loan," according to the summary. The homeowner could receive up to $1,000 a year for five years.
The Obama plan does not include provisions to help investors and is focused solely on owner-occupied homes. Officials said the administration is trying to provide enough help to stem foreclosures while not rewarding borrowers who purposefully stop paying. At the same time, Obama's team wanted to risk only as much taxpayer money as absolutely necessary.
The plan "will not rescue the unscrupulous or irresponsible by throwing good taxpayer money after bad loans," Obama will say, according to the text of his speech.
The administration estimates that the plan could stop the slide in home prices by up to $6,000 per home, simply by reducing foreclosures. "The effects of this crisis have also reverberated across the financial markets. When the housing market collapsed, so did the availability of credit on which our economy depends," Obama says in the prepared text. "As that credit has dried up, it has been harder for families to find affordable loans to purchase a car or pay tuition and harder for businesses to secure the capital they need to expand and create jobs."
And from WhiteHouse.gov, some of the fine print in the form of a Frequently Asked Questions thread:
Borrowers Who Are Current on Their Mortgage Are Asking:
What help is available for borrowers who stay current on their mortgage payments but have seen their homes decrease in value?
Under the Homeowner Affordability and Stability Plan, eligible borrowers who stay current on their mortgages but have been unable to refinance to lower their interest rates because their homes have decreased in value, may now have the opportunity to refinance into a 30 or 15 year, fixed rate loan. Through the program, Fannie Mae and Freddie Mac will allow the refinancing of mortgage loans that they hold in their portfolios or that they placed in mortgage backed securities.
I owe more than my property is worth, do I still qualify to refinance under the Homeowner Affordability and Stability Plan?
Eligible loans will now include those where the new first mortgage (including any refinancing costs) will not exceed 105% of the current market value of the property. For example, if your property is worth $200,000 but you owe $210,000 or less you may qualify. The current value of your property will be determined after you apply to refinance.
How do I know if I am eligible?
Complete eligibility details will be announced on March 4th when the program starts. The criteria for eligibility will include having sufficient income to make the new payment and an acceptable mortgage payment history. The program is limited to loans held or securitized by Fannie Mae or Freddie Mac.
Question: what is the point of helping homeowners who have an acceptable mortgage payment history? Doesn't that mean they aren't behind on their loans? Just asking. More fine print, and a seeming contradiction:
Borrowers Who Are at Risk of Foreclosure Are Asking:
What help is available for borrowers who are at risk of foreclosure either because they are behind on their mortgage or are struggling to make the payments?
The Homeowner Affordability and Stability Plan offers help to borrowers who are already behind on their mortgage payments or who are struggling to keep their loans current. By providing mortgage lenders with financial incentives to modify existing first mortgages, the Treasury hopes to help as many as 3 to 4 million homeowners avoid foreclosure regardless of who owns or services the mortgage.
Do I need to be behind on my mortgage payments to be eligible for a modification?
No. Borrowers who are struggling to stay current on their mortgage payments may be eligible if their income is not sufficient to continue to make their mortgage payments and they are at risk of imminent default. This may be due to several factors, such as a loss of income, a significant increase in expenses, or an interest rate that will reset to an unaffordable level.
Hm. I guess I'll just wait for the announce.
UPDATE: President Obama is presenting the plan now. It sounds much better somehow in his speech than it did in the WaPo. The plan is clear and straightforward: refinancing Fannie and Freddie backed mortgages to market value, reducing mortgage payments for those in trouble to one-third of their income, allowing homeowners who are "upside down" on their mortgages to refinance at lower interest rates, and he plans to move forward on allowing bankruptcy judges to reduce mortgage payments so that they reflect the fair market value of homes. Perhaps anticipating GOP objections to that provision, Obama pointed out that "that's already the rule for people who own 2, 3 and 4 houses, so it should also be the rule for people who own just one home."
... after working most of Tuesday night, members and staff were plainly exhausted, and continued disputes over Obama’s school construction initiative delayed a planned meeting of the formal House-Senate conference on the bill.
“Like any negotiation this involved give-and-take, and if you don’t mind my saying so, that’s an understatement,” said Reid. Down to the end, the school modernization funds were a bone of contention for Sen. Susan Collins (R.-Maine), whose vote is pivotal to the president.
Last Friday, she had successfully eliminated all such money from the Senate bill. Wednesday she agreed to allow $10 billion as part of a $54 billion fiscal stabilization fund but argued that the $10 billion should not be confined to this single dedicated purpose.
After Reid’s announcement, an administration official said the issue was resolved, as did Collins. But House leaders, who had grown resentful of the Maine Republican’s veto power over the bill, remained unhappy—forcing the delay.
So what is Collins' problem?
The constructions funds are especially sensitive in poor, often minority school districts less able to finance new schools. Among the many spending cuts made last week in the Senate, the school construction issue was perhaps the most ideological.
For the Obama camp, it brings back New Deal memories of the Public Works Administration creating construction jobs and building schools across the country. But Collins has always resisted arguing that, in today’s world, it represents an expansion of the federal role in state and local affairs.
Uh-huh... yeah, why help those poor minority kids, when you can just move to Maine, where there are no poor minority kids...
BTW it appears that the Senate has also screwed over urban districts, in favor of the rural folk who don't like Barack Obama anyway, and who from what I can tell, don't want an economic stimulus plan... and of course, they've also screwed over the poor.
... House Energy and Commerce Committee Chairman Henry Waxman (D., Cal.) said the tentative deal calls for 65% of the money to be distributed according to the Senate’s more rural formula; 35% as the more urban House wanted.
In the same talks, the House appears to have preserved its higher 65% subsidy to help laid- off workers meet COBRA payments to maintain employer-provided health insurance; the Senate had proposed 50%. But the House agreed in turn to drop its proposal to increase Medicaid coverage to help lower income individuals face the same insurance dilemma and can’t afford to pay even a subsidized COBRA payment.
One issue is that liberals in the House are objecting to the amount of money in the bill for school construction. Sources say the bill includes $6 billion for school construction. Negotiators worked hard to find a way to put the provisions back in after the Senate eliminated all $16 billion in school construction money. But some key House Democrats say that's not enough.
Another problem, sources say, is that some House Democrats say the bill gives states too much discretion on how to use some of the money intended for education. Some Congressman are concerned that governors will not use the money to help poor school districts.
Some Senate Democrats are unhappy, too. Sen. Tom Harkin, D-Iowa, says there is just not enough money in the bill for school construction.
"Every school in America will get 10,000 bucks if they're lucky," Harkin said, guessing that might be enough to buy two energy efficient windows. "And what's that going to do for them?" he asked. "We're trying to add new heating facilities. We're trying to add renovations. And doing it by formula doesn't do it."
Harkin says he'd ultimately vote for it, but he doesn't like the concessions made to get the support of the moderate Republicans.
WASHINGTON - Moving with lightning speed, key lawmakers announced agreement Wednesday on a $789 billion economic stimulus measure designed to create millions of jobs in a nation reeling from recession. President Barack Obama could sign the bill within days.
"The middle ground we've reached creates more jobs than the original Senate bill and costs less than the original House bill," said Senate Majority Leader Harry Reid, one of the participants in an exhausting and frenzied round of bargaining.
The bill includes help for victims of the recession in the form of unemployment benefits, food stamps, health coverage and more, as well as billions for states that face the prospect of making deep cuts in their own programs.
It also preserves Obama's signature tax cut — a break for millions of lower and middle income taxpayers, including those who don't earn enough to pay income taxes.
However, House Speaker Nancy Pelosi was conspicuously absent from the news conference in which members of the Senate announced the agreement, and it was not clear whether she stayed away out of unhappiness or a scheduling conflict.
Officials had said previously that one of the final issues to be settled was money for school modernization, a priority of Pelosi as well as Obama and one on which they differed with Collins and other moderates whose votes will be essential for final Senate approval.
The WaPo reports on the new D.C. Don Corleone, Susan Collins' ... take:
"I'm particularly pleased that we have produced an agreement that has the top line of $789 billion," she said. "It is a fiscally responsible number that reflects our efforts to truly focus this bill on programs and policies and tax relief that will help turn our economy around, create jobs and provide relief to the families of our country."
Collins, one of three Republican senators whose votes for the bill yesterday gave it a filibuster-proof majority, also said that in the final version, "we were able to increase the amount of infrastructure spending," which she called "the most powerful component in this bill to create jobs." She said the bill contains about $150 billion for infrastructure including transportation, environmental, broadband and other projects.
More than 35 percent of the funding goes for tax relief, Collins said.
And a bit more on what they were fighting over:
Before the House-Senate conference, Democratic negotiators convened a final meeting with Senate centrists who had forced steep cuts in the spending portion of the stimulus plan -- which at one point last week had grown to almost $940 billion in new tax cuts and domestic spending.
Even after the Senate scaled down its version to $838 billion, approved 61-37 yesterday, the centrists continued to demand more reductions. Senate aides said the targets were reducing Obama's "Make Work Pay" tax cut of $500 a year for most individuals and $1,000 a year for most families, paring it down to $400 and $800, respectively.
Other reductions were likely in a $15,000 tax credit for all home purchases in the next year as well as a tax credit for the purchase of new cars, both of which were added to the Senate bill after little debate.
House Democrats have objected to wholesale deletions from their original bill during the Senate debate, but they appeared likely to see some return of aid to states that totaled $79 billion in their plan. The Senate reduced that figure to $39 billion. Senators also zeroed out a fund that would finance school construction, another priority for which House Democrats are pushing to restore funds.
The wrangling may be the reason that not just Pelosi, but also the White House, have withheld the kudos from what just might be a moderate mish-mash bill:
... in a bewildering _ if temporary _ turn of events, House Speaker Nancy Pelosi and the White House withheld immediate expressions of support, and the formal meeting of congressional bargainers who will need to ratify the deal was delayed.
At a news conference in the Capitol, Senate Majority Leader Harry Reid, flanked by moderate senators of both parties, said agreement had been reached on a compromise that "creates more jobs than the original Senate bill and costs less than the original House bill."
“Usually you go to conference and split the difference between the two houses — that may not be the case here,” Pelosi said. “At these conferences, my experience has been that the White House has a seat at the table — that they weigh in.”
Both Obama and Pelosi are hoping to restore significant stimulus spending eliminated by the Senate, especially $21 billion in school construction and technology grants, $10.3 billion in COBRA insurance and $8.6 billion in new Medicaid coverage for the unemployed.
Personally, I blame Harry Reid, who has given virtual veto power over the bill to Susan Collins.
Step one: take out everything House Republicans asked for
The negotiations are moving along on the House-Senate economic revitalization conference bill. Andrea Mitchell just reported that the gist of the changes are to add back in state grants that were stripped in the Senate (and we know the White House wants school construction money restored as well) and cutting back some tax cuts requested by Republican House members who wound up not voting for the bill. As Mitchell put it, the House GOP provisions were "the first to go." After all, Democrats got nothing in exchange for them.