Monday, February 2, 2009

PROMISES, PROMISES: No lobbyists at WH, except ...

WASHINGTON – Barack Obama promised a "clean break from business as usual" in Washington. It hasn't quite worked out that way.

From the start, he made exceptions to his no-lobbyist rule. And now, embarrassing details about Cabinet-nominee Tom Daschle's tax problems and big paychecks from special interest groups are raising new questions about the reach and sweep of the new president's promised reforms.

Maybe he shouldn't have promised so much, some open-government advocates say. They're willing to cut him some slack — for now.

On Jan. 21, the day after his inauguration, Obama issued an executive order barring any former lobbyists who join his administration from dealing with matters or agencies related to their lobbying work. Nor could they join agencies they had lobbied in the previous two years.

However, William J. Lynn III, his choice to become the No. 2 official at the Defense Department, recently lobbied for military contractor Raytheon. And William Corr, tapped as deputy secretary at Health and Human Services, lobbied through most of last year as an anti-tobacco advocate. Corr says he will take no part in tobacco matters in the new administration.

"Even the toughest rules require reasonable exceptions," said White House Press Secretary Robert Gibbs.

That was a big step back from Obama's unambiguous swipe at lobbyists in November 2007, while campaigning for the Democratic presidential nomination. "I don't take a dime of their money," he said, "and when I am president, they won't find a job in my White House."

The waivers granted for Lynn and Corr caused some in Washington to wince. But others, including many longtime advocates of tougher ethical standards, suggest it all says as much about deeply ingrained practices — and even necessities — in Washington as about a new president.

"Sometimes you can over-promise," said former Sen. Warren Rudman, a Republican from New Hampshire.

"This government is very complicated," he said. "Often you'll need people with a lot of experience in certain areas," and current or former lobbyists sometimes fit that bill best.

"It was probably a mistake to come down so hard on lobbyists," said Melanie Sloan, who is not shy about criticizing lobbyists or politicians as executive director of Citizens for Responsibility and Ethics in Washington. "I think the Obama folks' intentions were great here," she said. "But sometimes you realize you can't actually govern on just what you campaigned on."

Sloan and others said embarrassments over Daschle, one of several top Obama appointees with a history of influencing government for clients, should not detract from the president's first-day vow to sharply limit the role of lobbyists in his administration.

Daschle, a former senator tapped to head Health and Human Services, is not technically a lobbyist. But he was paid more than $5.2 million over the past two years as he advised health insurers and hospitals and worked in other industries such as energy and telecommunications.

Fred Wertheimer of Democracy21 is one of Washington's best-known advocates of more open and honest government. He called Obama's executive order "unprecedented and almost revolutionary in nature" and "a direct attack on the culture of Washington and the way business is done here."

"A few waivers will not undermine it," he said, provided they are justified and limited.

The best way to limit the influence of wealthy special interests, Wertheimer said, is to increase public funding for presidential elections and restrict the amount that private business can pump into campaigns and politics. That could pave the way for tighter restrictions on influence-peddling in Congress, he said.

Obama declined public financing for his campaign so he could raise and spend hundreds of millions of dollars on his own. Some people saw that a virtual death knell for campaign public financing, but Wertheimer said he believes Obama will deliver on aides' promises to help "repair the system."

Daschle, the former Senate majority leader from South Dakota, strikes many in Washington as a good example of why the revolving door between government and highly paid private-sector jobs can be troubling, but also why an outright ban on such movements would be unwise.

Even Republicans praised Daschle's cerebral, soft-spoken approach to government and politics, and his expertise on subjects including health care. He didn't choose to leave Congress for a high-paying job, but was defeated in a close re-election bid in 2004.

Once out, he was attractive and valuable to all sorts of government-regulated industries, even if he never registered as a lobbyist who could make straightforward appeals for or against legislation affecting his clients.

He received more than $2 million over two years as a senior policy adviser for the Washington law firm Alston & Bird. He also earned more than $2 million in consulting fees from InterMedia Advisors LLC of New York, an investment firm specializing in buyouts and industry consolidation. An associate let Daschle use his car and driver, for which Daschle had to pay late taxes and interest.

Several health groups also paid Daschle $15,000 or more to speak to their gatherings.

"He welcomed every opportunity to make his case to the American public at large, and the health industry in particular, that America can't afford to ignore the health care crisis any longer," said his spokeswoman Jenny Backus.

Wertheimer, of Democracy21, said that rather than dwell on Daschle's problems or the Corr and Lynn waivers, he focuses on Obama's executive order and the hope of progress to come on public financing of campaigns.

The executive order "laid down a mark," Wertheimer said. "More has to be done, and tough battles have to be won."


Associated Press writer Julie Pace contributed to this report.

Michele Bachmann: The perils of spending like it's 1929:

By Michele Bachmann
Star Tribune
January 29, 2009

It's been almost one year and $1.5 trillion since the government began its historic slate of financial bailouts -- and all we have to show for it is red ink dripping from our nation's balance sheet.

Congress has been busy writing checks to everyone from Detroit automakers to Wall Street day traders. We're now nearing a historic $11 trillion debt. Each time Congress goes to the taxpayer ATM, it claims that this will be the bailout that gets the economy moving again.

For instance, on the night the Senate passed the $700 billion Wall Street bailout, the Senate's finance chairman, Max Baucus, confidently declared: "I'm very proud of what we did. This is going to mark the time when we've turned the corner. And we will begin to see this financial crisis beginning to abate."

But things got only worse. And despite the serious risks to our long-term stability, this failed strategy of big-government stimulus continues in full force. This week, in fact, President Obama and the Democratic Congress asked for another near-trillion in federal deficit spending.

Their plan promises an agenda styled after the economic policies of the Great Depression -- government jobs programs, enormous infrastructure spending, huge amounts of pork and a slew of government handouts. But before we return to the 1930s, we may want to review a little history.

The stock market collapse of 1929 brought a crashing halt to the Roaring Twenties. But President Herbert Hoover's response to the economic crisis ensured that it became a genuine catastrophe. Contrary to popular perception, Hoover did not respond to the downturn with inaction or indifference -- rather, he pursued a series of misguided big-government adventures that lengthened and deepened our economic woes.

Hoover not only dramatically hiked income and import taxes, but he instituted big-government spending programs all but identical to those being debated today. Hoover's Reconstruction Finance Corporation tried to ease economic pain by funneling tax money to state governments, local governments, banks and a variety of businesses. His Federal Home Loan Bank Act extended loans in an effort to increase low-income housing -- beginning the ill-fated history of federal intervention in the housing market.

These measures proved a dismal failure, and things got only worse. In the 1932 campaign, Franklin Roosevelt actually attacked Hoover for his big-government policies, decrying Hoover's presidency as "the greatest spending administration in peacetime in all of history."
Yet, once elected, Roosevelt not only maintained Hoover's programs, he used them as a foundation for his titanic New Deal expenditures. He even expanded Hoover's failed housing program and launched the now-infamous mortgage giant Fannie Mae. And even in the face of a staggering 25 percent unemployment, FDR held fast to the big-government philosophy -- jobs programs, handouts, tax hikes -- and, as a result, presided over a decade of economic misery.

FDR's own treasury secretary, Henry Morgenthau, had to admit as much in 1939: "We are spending more than we have ever spent before, and it does not work. ... We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started. And an enormous debt to boot!"

Instead of pursuing the tragic economic policies of Hoover and FDR, we should follow the model of presidents who successfully met the economic challenges of their times and ushered in prosperity. In recent memory, Presidents John F. Kennedy and Ronald Reagan dramatically cut taxes to stimulate growth and create jobs -- and their policies succeeded.

When Jimmy Carter left office, the economy was slumping, unemployment was higher than today and inflation was in the double digits. Reagan's economic policy, which included massive tax cuts, reversed a worsening situation, and the economy surged on every level -- 17 million jobs were created, employee compensation increased, inflation was conquered and the longest peacetime boom in our history was born.

So with two paths ahead -- one that emphasizes tax reform and one that emphasizes big government -- the right path is clear. We either learn from the mistakes of history or we repeat them

Michele Bachmann, R-Minn., is a member of the U.S. House of Representatives.

© 2009 Star Tribune. All rights reserved.

Here is what the republicans supported for a bailout.

The House of Representatives passed a so-called stimulus package last week that, when the more than $300 billion in interest payments are added in will cost the American taxpayers over $1.1 trillion. I could not support this package, which I felt included far too little actual stimulus, included far too much plain old political pork, and added way too much debt to the already over-burdened American taxpayer, as well as generations of taxpayers to come.

The idea of investing in shovel-ready transportation and infrastructure projects to stimulate the economy is one worthy of Congress’ support. It would quickly inject money into the economy by getting construction and related job sectors working – while also taking care of important infrastructure projects that have been on the nation’s “to do list” for some time. Unfortunately, the package passed by the House last week, included such funding almost as an afterthought. It was overshadowed by hundreds of billions of dollars for brand-new programs, the National Endowment for the Arts, federal government office buildings, and more.

I supported an alternative package that really would stimulate the economy by putting more money in the hands of small businesses and families that can really use it to create jobs, purchase goods, and more. Amongst other things, the Republican Economic Recovery Plan would:

• Reduce the lowest individual tax rates from 15% to 10% and from 10% to 5%, helping more than 500,000 filers in Minnesota’s Sixth District alone.

• Allow small businesses to take a tax deduction equal to 20% of their income.

• Provide a home-buyers credit of $7500 for those who can make a minimum down-payment of 5%.

I also supported a motion to recommit, or to send the Democrat package back to committee to make the following changes:

• Increase investment in shovel-ready transportation and infrastructure projects by $60.25 billion.

• Eliminate $135.8 billion in funding for 32 new discretionary programs created by the bill.

• Eliminate Fiscal Year 2010 funding for 17 existing federal programs – funding that jumps the gun on a budgeting process that hasn’t even begun yet.

• Reduce funding for the National Endowment for the Arts, Americorps, GSA federal office buildings, and NOAA Habitat Restoration.

Last week, I also published a column in the Star Tribune that sought to put the massive $825-billion stimulus package in some historical context. In case you missed it, you can read it here:

Even the socialist French don't want to be as socialist as Obama.

LYON: Prime Minister François Fillon on Monday rejected demands that the French government seek to stimulate consumer spending, rather than follow his plan to stimulate corporate and infrastructure investment, to lift France out of its economic slump.

"It would be irresponsible to chose another policy, which would increase our country's indebtedness without having more infrastructure and increased competitiveness in the end," Fillon said in a speech in Lyon.

More than 1.1 million people took to the streets across France last Thursday, according to the Interior Ministry, with unions putting the number of protesters at 2.5 million, to call on President Nicolas Sarkozy to stop cutting government jobs, increase the minimum wage and spend more on households as the economy enters its first recession since 1993.

Opponents of the government have been calling for an "Obama-style" stimulus plan, one that puts money directly into the pockets of working people.

French unemployment rose by about 45,000 people in December, Finance Minister Christine Lagarde said Monday, taking the jobless ranks to the highest level in about two years.
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The European Commission expects France's economy to contract 1.8 percent this year, the worst performance since World War II. Lagarde said the government would revise its economic forecast to project a contraction this year.

After the strike, Sarkozy adopted a conciliatory tone, noting that the public had "legitimate concerns," and he said he would meet with union leaders in February to explain his 2009 agenda and discuss how to best carry it out.

In December, Sarkozy announced a stimulus package worth €26 billion, or $33.4 billion, over 2009 and 2010, including €11.4 billion in early state reimbursement to companies, and about €10 billion in infrastructure investment by the government, local authorities and state-controlled companies.

Fillon said Monday that Électricité de France would increase investment this year by €2.5 billion to build and renovate new power plants and its grid. GDF Suez, the natural gas and water utility, would lift investment by €200 million.

The Paris transportation authority and the national railroad would increase investment on new trains and infrastructure by €1.35 billion.

The government would spend €400 million on road building and renovation, €300 million on railroads, and €170 million on ports and river infrastructure. It would spend €731 million on universities and research centers and €620 million to renovate prisons, courts and more than 70 monuments and 50 cathedrals.