Washington Watch
August 2009
- History-Making Effort in August on EFCA
- Newest Data Shows Economy Set for Jobs Rebound
- Senators Hope to Keep Health Care Compromise Alive During Recess
- Ten Senators’ Demands for Tariffs Pose Threat to Climate Legislation
- Congress Approves Short-Term Highway Funding Bill
- Government Expects GM to Go Public Before Chrysler
History-Making Effort in August on EFCA
The Employee Free Choice Act is at
the top of many minds as we enter in to the August congressional
recess. Labor leaders met in
To counter this effort, the
Don't let intimidation of the labor unions' strategy outweigh our chances of
defeating this legislation. Stay active during this congressional recess
(August 3 - September 4) and contact Coalition Coordinator Sarah Beth Turner
at (501) 975-8344 or e-mail her at info@yoursecretballot.com for additional information or to become a part of the coalition
against EFCA.
Newest Data Shows Economy Set for Jobs Rebound
The Wall Street Journal reported, "The rapid pace at which businesses shed jobs during the recession comes with a flip side: Workers will need to be hired back quickly as the economy improves." So "deep have companies cut jobs that Friday's employment report, which showed that the U.S. economy lost a quarter-million jobs in July, was seen as a relief." Businesses say "they are running lean" and "to be sure, even as more companies begin to hire as the economy recovers, it could take years before payrolls reach their prerecession level." But "one thing different about this recession -- and one more reason the job market may come back more quickly than in the downturns of 2001 and 1990-91 -- is that so many of the job losses have been at the service-related companies that have come to dominate U.S employment." Many service-related firms "may have a more pressing need than manufacturers to rehire workers as demand comes back."
The New York Times reported, "The most heartening employment report since last summer suggested on Friday that a recovery was under way - and perhaps gathering steam - despite the reluctance of the nation's businesses to resume hiring or even stop shedding jobs." Employers "eliminated 247,000 jobs in July, a huge number by the standards of an ordinary recession, but the smallest monthly loss since last August, the Bureau of Labor Statistics reported." And the unemployment rate "actually ticked down, to 9.4 percent from 9.5 percent in June, mainly because so many people dropped out of the hunt for work, ceasing to list themselves as unemployed." But the employment report released Friday "included some unsettling information. ... never in the 61 years of recordkeeping has one-third of the unemployed, currently 14.5 million people, been out of work for 27 weeks or more."
Reuters added that the government revised data for May and June to show 43,000 fewer jobs were lost than previously reported, but the White House said it still expected the unemployment rate to hit 10 percent this year.
In similar news, the Wall Street Journal reported, "Stocks rose on Friday to their highest levels since November after a better-than-expected jobs report boosted sentiment." The report "delivered a positive surprise, showing a smaller-than-expected drop in payrolls and a tick down in the unemployment rate." The Dow Jones Industrial Average "rose 113.81 points, or 1.2 percent, to 9370.07. Its financial components gained, with J.P. Morgan Chase rising 4 percent and American Express up 4.4 percent." And the S&P 500 index "climbed 13.40 points, or 1.3 percent, to 1010.48."
But in a separate story, the Wall Street Journal noted that "there is a smudge on the picture. A surprisingly large number of money managers and economists are warning that, despite the hopeful signs, the economy is still deep in the woods, not strong enough to support a long-running stock and bond recovery." According to this view, the "market surge of the past five months has been a celebration of the government's success in staving off financial doom." To keep "rising in the future, the market needs a sign of real economic recovery, and that requires a surge in consumer spending, business investment and home buying." Consumer borrowing "fell in June for the fifth consecutive month." As for home building and capital spending, some analysts "do not expect a 'traditional' rebound in these sectors."
The AP added, "Now that housing and even unemployment are showing signs of improvement, Wall Street wants consumers to do their part to heal the economy." Investors will "get some insight this week into how consumers are spending from a government report on July retail sales." Analysts say investors "need to see evidence that consumer spending is picking up before they'll keep the market's summer rally going." Lackluster sales reports "from some of the nation's retailers last week were a reminder that consumers are still nervous." One potential problem that "could deter consumers and stifle the economy's rebound is rising interest rates. As the economy improves, the Federal Reserve may be forced to raise its benchmark federal funds rate, which stands at a record low of near zero, to prevent a surge in inflation."
Senators Hope to Keep Health Care Compromise Alive During Recess
The Washington Post reported, "Senators headed home for their August break [last] Thursday amid an escalating partisan battle over health-care reform, with a small band of lawmakers hoping to keep their delicately negotiated compromise alive until Congress reconvenes in September." Sen. Olympia J. Snowe (R-Maine), a "key negotiator, said she was so alarmed about distortions involving the deal being developed by members of the Finance Committee that she urged President Obama during a visit to the White House on Thursday to rebut conservative allegations, 'to lessen the concern' about the emerging legislation." But Senate Democratic leaders "continued to stoke the controversy, accusing GOP leaders of an artificial grass-roots movement to undermine public confidence in reform efforts." Snowe and her two Republican and three Democratic colleagues on the Finance Committee "held a final bargaining session Thursday, although the group plans to continue negotiations this month."
Meanwhile, the Washington Post reported, "Hectoring protesters at a handful of Democratic town hall forums became a flash point [last] Wednesday in the health-care debate, as party leaders cast the critics as 'angry mobs' trying to 'destroy President Obama' while Republicans accused Democrats of dismissing public opposition to their proposals." As House members "head home for the August recess, some Democrats have been met by taunts, jeers and, in one case, an effigy." Video footage of the "sometimes-belligerent protests has taken hold online and on television in a relatively quiet news week, threatening to drown out any health-care debate." Democrats have "sought to marginalize the objections...prompting House Minority Leader John A. Boehner (R-Ohio) to respond, 'Instead of acknowledging the widespread anger millions of Americans are feeling this summer toward Democrat-controlled Washington, Washington Democrats are trying to dismiss it as a fabrication.'"
In a Wall Street Journal opinion piece, Scott Rasmussen, the founder and president of Rasmussen Reports, writes, "For all the back and forth about the 'public option,' Congressional Budget Office estimates and proposed tax hikes, the fundamentals are really what make health-care reform a hard sell to American voters." As members of Congress "head home for the August recess, they should take a close look at some poll numbers before they attempt to pass any new legislation." The most "important fundamental is that 68 percent of American voters have health-insurance coverage they rate good or excellent...Most of these voters approach the health-care reform debate fearing that they have more to lose than to gain." While the president says "his plan will reduce costs, 53 percent believe it will have the opposite effect." And "78 percent believe passage of the current congressional health-care proposals is likely to mean higher taxes for the middle class."
Similarly,
a number of governors are said to fear the cost of health care reform. The New York Times reported,
"Cutbacks, in response to the recession that has eroded state finances
even while swelling Medicaid ranks, is the reason Washington's Democratic
governor, Christine Gregoire, is among governors from both parties who fear
the implications of the health care overhaul now being devised in Washington,
D.C." The governors worry Congress "will give the states expensive
new Medicaid obligations without providing enough new money to pay for
them." If anything, the states' fears "were stoked further last
week when House lawmakers drafting health legislation reached a cost
compromise with conservative Blue Dog Democrats that would force states to
take on a greater Medicaid spending burden than an earlier version of the
bill." In most respects, Gregoire is an "outspoken supporter of
President Obama's effort to overhaul health care." But she "knows
Ten Senators' Demands for Tariffs Pose Threat to Climate Legislation
The Wall Street Journal reported that last Thursday "10 Senate Democrats whose votes are pivotal to the success of climate legislation urged the Obama administration...to support levying tariffs on goods from countries that don't limit their greenhouse-gas emissions." The Senators, in a letter to President Obama said that "it was critical to include a 'border mechanism' in climate legislation to ensure it would be 'trade neutral and environmentally effective,'" and "warned that it would be 'extremely difficult' to support a bill that didn't 'deal with these important issues.'" In response to the letter, a White House spokesman said in a statement that Obama -- who "has resisted the idea, saying it would send 'protectionist signals' to the world" – believes "that the most effective approach to maintaining a level playing field is to negotiate a new international climate change agreement that ensures that all the major polluters take significant actions to reduce their greenhouse gas emissions."
The New York Times reported, "Ten moderate Senate Democrats from states dependent on coal and manufacturing sent a letter to President Obama [last] Thursday saying they would not support any climate change bill that did not protect American industries from competition from countries that did not impose similar restraints on climate-altering gases." The 10 senators are "seen as crucial undecided votes in the Senate debate on climate legislation." The senators "called for transition aid for energy-intensive manufacturers in the form of rebates on their energy costs; negotiation of a strong international agreement on emissions; programs to monitor emissions in other countries; and significant financing for clean energy technology." The senators also "proposed 'border adjustments,' tariffs, on goods from countries that do not agree to an international program for carbon dioxide reductions."
In
the Wall Street Journal "Environmental Capital" blog, Keith Johnson wrote, "10
Democratic senators sent President Obama a letter demanding a 'level playing
field' for
Congress Approves Short-Term Highway Funding Bill
By a vote of 363-68, the House of Representatives on July 29 approved H.R. 3357, legislation that includes a transfer of $7 billion from the Treasury to the Highway Trust Fund (HTF) so that critical infrastructure projects will remain funded through September 30. The Senate passed companion legislation by a vote of 79-17 on July 30, clearing the measure for the President's signature.
A showdown appears likely in September over funding of a long-term highway reauthorization bill. The White House and Senate leaders appear to favor an 18-month extension of current highway and transit programs so that Congress can wait to pass the next highway bill until after the 2010 elections. Meanwhile, House Transportation and Infrastructure Committee Chair Jim Oberstar (D-MN) and Ranking Member John Mica (R-FL) want a much shorter extension to keep the pressure on lawmakers to pass a long-term bill as soon as possible.
Government Expects GM to Go Public Before Chrysler
The New York Times reported, "The federal government is likely to begin selling its stake in General Motors sooner than its share of Chrysler, the head of President Obama's auto industry task force said [last] Wednesday." Ron Bloom said "members of the task force thought G.M. could begin selling stock on the public markets in 2010 but that an initial offering for Chrysler probably would occur later than that." But he stressed "that unloading the 61 percent share of G.M. and 8 percent share of Chrysler would take time so as not to destroy their value." He said the task force "would not announce a specific timetable."
The Wall Street Journal reported Bloom said "both companies will post operating profits at about the same time...declining to say when that would be." In anticipation of their return to public markets, "both car makers will report quarterly financial results and make voluntary filings to the SEC." Bloom also stressed "that the government won't take a direct role in managing either company. The automotive task force that was put in place to manage the restructurings is expected to shrink to fewer than six members from about 12 at its peak, with three members leaving [last] week." Regarding GM, Bloom "backed GM Chairman Edward E. Whitacre, Jr.'s market-share growth strategy." On Chrysler, Bloom said he "expects that under the leadership of Fiat SpA Chief Executive Sergio Marchionne the company will move quickly to introduce new products and take a different marketing approach."
