The Obama Administration

The Mortgage Mess and Jack Lew

Rex Features via AP Images
The more information we learn about the mortgage settlement that was announced Monday—official documents are yet to be made public—the more of a smarmy backroom deal it turns out to be. The deal lets ten major banks and other “loan servicers” off the hook for a corrupted and illegal process of millions of foreclosures, with a paltry one-time settlement of $8.5 billion. The economic damage inflicted on homeowners, and by extension on the economy, was many times that. The deal was hatched by the weakest of the federal bank regulatory agencies, the Comptroller of the Currency, and signed off on by the Federal Reserve. There was no consultation with the more consumer-oriented agencies, such as the FDIC or the Consumer Finance Protection Bureau. The Comptroller just went and did it. Nor was the Justice Department consulted, even though the deal, nominally a civil settlement, will make criminal prosecutions more difficult now that a major regulator has signed off on an bargain to close the...

Is Jack Lew the Best We Can Do?

AP Photo/Charles Dharapak
AP Photo/Charles Dharapak White House Chief of Staff Jack Lew in the East Room of the White House in Washington T o no one’s great surprise, President Obama has appointed his chief of staff, Jack Lew, to succeed Tim Geithner as Treasury Secretary. Mainly, the choice signals that there will be no change either in the Obama-Geithner approach to reforming Wall Street (not very much), or on fiscal politics, where deficit reduction is a paramount goal despite a faltering recovery. The positives of Lew are these. He’s not a hard-core deficit hawk like Erskine Bowles (low bar). He’s not a bully like Larry Summers or Rahm Emanuel (even lower bar.) He’s a highly competent, detail-oriented numbers guy, and a skilled negotiator. That combination seems to drive some Republicans nuts, because in the infighting over the budget deal of 2011, Lew’s knowledge of the details enabled him to win some tactical victories in what was otherwise a rout for the administration (this was the deal that created...

Obama's Options on 2013's Big Issues

AP Photo/Carolyn Kaster
Anyone who thinks congressional Republicans will roll over on the debt ceiling or gun control or other pending hot-button issues hasn’t been paying attention. But the President can use certain tools that come with his office—responsibilities enshrined in the Constitution and in his capacity as the nation’s chief law-enforcer—to achieve some of his objectives. On the debt ceiling, for example, he might pay the nation’s creditors regardless of any vote on the debt ceiling—based on the the Fourteenth Amendment’s explicit directive (in Section 4) that “the validity of the public debt of the United States … shall not be questioned.” Or, rather than issue more debt, the President might use a loophole in a law (31 USC, Section 5112) allowing the Treasury to issue commemorative coins—minting a $1 trillion coin and then depositing it with the Fed. Both gambits would almost certainly end up in the Supreme Court, but not before they’ve been used to pay the nation’s bills. (It’s doubtful any...

Fighting Education Shock Therapy

With tools from 1964, community activists are pushing the White House to turn federal education policy around.

AP Photo/Charles Rex Arbogast
AP Photo/Charles Rex Arbogast Sixty-five-year-old John Washington pick up his great grandson, Rayshaun Cates, at Samuel Morse Elementary School, a Chicago school closed in 2006. T he watchword of austerity, “there is no alternative,” connotes painful cuts and layoffs adopted by fiscally shot local governments. In practice, though, this is a contradiction in terms: the politics of austerity are also a politics of imaginative restructuring, in which fiscal crisis is a cover for what Clintonites called “reinventing government” or, as partisans of Naomi Klein might prefer, “shock therapy.” The lie is starkest in the realm of education policy, where the Obama administration prescribes a slate of options for impoverished communities receiving federal School Improvement Grants. These range from “turnarounds,” which replace the principal and at least half of school staff, to charterization or outright closure. The catch with turnarounds and closings? Urban schools affected by them house more...

Solis Steps Down

AP Photo/Charles Dharapak, File
There has never been a more pro-worker Secretary of Labor than Hilda Solis, who announced yesterday that she’s stepping down from her cabinet post. But for much of her tenure, she was swimming upstream—confronting not just most anti-labor congressional Republicans in modern American history, but also an Obama White House inner circle that she, like many of her fellow cabinet members, never really permeated. Within those considerable constraints, Solis did what she could to get the federal government to intervene on workers’ behalf. Unable to advance many new policies, however, that often meant enforcing established pro-worker policies with uncommon vigor. During her tenure, the Labor Department collected record amounts of back pay for workers cheated by their employers, and moved to strengthen mine-safety inspections. The administration also announced new regulations that would bring nearly 2 million home-care workers under the coverage of the federal minimum-wage law, but,...

The Clear Legality of the Platinum-Coin Solution

It's likely that early this year we will once again see another debt ceiling crisis, with Republicans in Congress threatening the credit of the United States in order to win unpopular policy concessions. One increasingly popular idea for getting out of this cycle of hostage-taking is for the president to mint a trillion-dollar platinum coin that would allow the federal government to meet its outlays even if Congress refuses to lift the debt ceiling to allow the executive branch to cover the expenditures is has already required. Support for the idea, however, is far from unanimous. Mother Jones 's Kevin Drum has argued and reiterated that progressives are wrong to support the idea. The platinum-coin idea, Drum argues, is "not legal," and a legal challenge "would go against Obama 9-0 if it ever made it to the Supreme Court." Drum's objections, however, are erroneous. The platinum coin would be legal, and if the Republicans were to shoot their metaphorical hostage (i.e. the American...

Ending the Mindset that Got Us into Iraq

AP Photo/Bill Wolf
Rex Features via AP Images The nomination announcement for Chuck Hagel as the next Secretary of Defense and Deputy National Security Advisor for Homeland Security and Counterterrorism John Brennan as the next director of the Central Intelligence Agency, in the East Room of the White House. P resident Obama’s announcement yesterday of his nomination of former Nebraska Senator Chuck Hagel for Secretary of Defense is important in a couple of ways. The first is that by following through with a candidate who faced one of the most intense negative pre-nomination campaigns in recent memory, the president signaled that is shaking off some of the caution that characterized his first term, and is prepared to undertake a bolder political course. Indeed, the opposition to Hagel already seems to be weakening in the face of an overwhelming outpouring of support for the nomination now that it has been announced. According to a former Democratic Senate staffer I spoke to, this was to be expected. “It...

Once Again, Obama Does Something No GOP President Bothers to Do

Ten points if you know who this is.
I'm sure there are many reasons why President Obama nominated Chuck Hagel to be secretary of Defense, but the fact that Hagel is a Republican surely played at least some part. After all, if he nominated a Democrat to head the Pentagon, congressional Republicans would surely oppose the nomination and charge that the nominee was too dovish. Which of course is exactly what has happened with Hagel (along with some truly despicable phony accusations of anti-Semitism*). I'm not the first liberal to be disappointed with the fact that Democratic presidents seem to feel the need to placate their opponents by picking Republicans for this particular position. As Michael Beschloss observed , Republican presidents have never picked a Democrat for this job, but about half the secretaries of Defense in Democratic administrations have been Republicans. What's most important to note about this is that there is no equivalent on the other side. Republican presidents don't feel the need to appoint...

Barney Frank Walks Back on Hagel

World Economic Forum / Flickr
World Economic Forum / Flickr Republicans straining to present opposition to Chuck Hagel as bipartisan had a small assist from retired Massachusetts lawmaker Barney Frank last week, who because of Hagel’s 1998 criticism of Ambassador James Hormel—he called him “openly, aggressively gay”—said he “ strongly opposed ” his nomination to head the Defense Department. As of today, however, conservatives will no longer be able to cry crocodile tears on gay rights and turn to Frank as an example of anti-Hagel criticism from “both sides.” Here’s the Huffington Post : Former Rep. Barney Frank (D-Mass.) is softening his opposition to Chuck Hagel’s likely nomination as Defense Secretary, saying he is willing to overlook the former Republican senator’s past anti-gay remarks and positions. “As much as I regret what Hagel said, and resent what he said, the question now is going to be Afghanistan and scaling back the military,” Frank told the Boston Globe in an interview. ”In terms of the policy stuff...

Calling McConnell’s Bluff

Flickr/Gage Skidmore
The budget deal that just averted the supposed fiscal cliff was only a warm up. The next fiscal cliff is the $110 billion in automatic budget cuts (sequesters) that last week’s budget deal deferred only until March. But, as long as we are using topographic metaphors, this is less a cliff than a bluff. On the Sunday talk shows, Republican leaders were full of bravado and swagger. Representative Matt Salmon of Arizona, on CBS “Face the Nation” said it was about time “for another government shutdown.” Senate Minority Leader Mitch McConnell, speaking with ABC’s George Stephanopoulos, ruled out any further tax increases, declaring that “the tax issue is finished, over, completed.” He insisted, “Now it’s time to pivot and turn to the real issue, which is our spending addiction.” But is spending really the problem? For most the postwar era, federal tax revenues hovered around 19 percent of GDP, and spending a bit more than that. But for the four years since the financial collapse, federal...

Conservative Projection Takes a New Angle

Flickr/kylebogucki
Peggy Noonan is, without doubt, America's most hilariously ridiculous opinion columnist, someone forever pleading that we ignore piffle like "facts" and focus instead on the collective emotions that are bubbling just out of our awareness until she identifies them. But in her column today , she does something that we ought to take note of, because I suspect it will become a common Republican talking point. Noonan asks why Obama is so darn mean to Republicans, and answers the question thusly: Here's my conjecture: In part it's because he seems to like the tension. He likes cliffs, which is why it's always a cliff with him and never a deal. He likes the high-stakes, tottering air of crisis. Maybe it makes him feel his mastery and reminds him how cool he is, unrattled while he rattles others. He can take it. Can they? He is a uniquely polarizing figure. A moderate U.S. senator said the other day: "One thing not said enough is he is the most divisive president in modern history. He doesn't...

Will There Be a Second-Term Obama Administration Scandal?

Just after the election, I wrote that the reason conservatives were so worked up about the tragic events in Benghazi was scandal envy; they were livid that a president they despise so much had gone an entire term without a major scandal, so they were desperately grasping for whatever was handy. The response I go from many conservatives was vigorous, including assertions that Benghazi was a far worse scandal than Watergate (that necessitated another post explaining, for those who had apparently forgotten, why Watergate was a big deal). But as President Obama's second term begins, we have to wonder: What's the big Obama administration scandal going to be? There might not be one, of course. It's possible that his second term will proceed with nothing but low-grade controversies on the order of Solyndra or Fast and Furious, Darrell Issa's best efforts notwithstanding. The lack of a scandal so far might be a testament to Obama's integrity, but it's just as attributable to good luck. After...

Give Barry a Break

AP Photo/Charles Dharapak
AP Photo/Charles Dharapak President Barack Obama winks as he arrives to make a statement regarding the passage of the fiscal-cliff bill in the Brady Press Briefing Room at the White House. W hen President Lincoln suspended habeas corpus in 1862 (a couple of times, actually), he conceded the possible unconstitutionality of what he had done but concluded that since the move was necessary in a time when half the country was at war with the other half, he would take his chances with Congress, the courts, and history. The country’s current chief executive finds Lincoln comparisons disconcerting, but this is a case where he might pay attention, because his legal grounds for unilaterally raising the ceiling on the national debt in a time of congressionally inflicted crisis are no weaker than Lincoln’s and probably stronger. The latest furor over who should be paying taxes in this country is, as of 36 hours ago, over. This follows a presidential campaign in which the candidate who ran on...

Retrench Warfare

AP Photo/Alex Brandon
AP Photo/Alex Brandon Senator Mike Johanns, a Republican from Nebraska, left, walks with Senate Minority Leader Mitch McConnell from Kentucky to the Senate floor for a vote on the fiscal cliff early this morning. The Senate vote just before dawn in favor of a permanent tax hike on the top one percent defers virtually all of the other budget battles. Assuming the House follows suit today, it is up to President Obama and the Democrats to radically change the conversation. In the deal that the Senate agreed to, with only eight senators voting against, the Democrats won big in two respects. They forced the Republicans to raise taxes on the rich, and they took all spending cuts including in Social Security off the table—for now. If Tea Party Republicans vote against the deal and it passes the House with the voters of nearly all Democrats and a few dozen renegade Republicans, it could cost John Boehner his Speakership. But automatic cuts of $120 billion this year and $1.2 trillion over a...

Obama Appoints Scott Brown as Senator from Massachusetts

Flickr/U.S Embassy Kabul Afghanistan
Flickr/U.S Embassy Kabul Afghanistan Senator John Kerry and Afghanistan President Hamid Karzain in Kabul in 2009. The Washington Post reports that President Obama has nominated Massachusetts Senator John Kerry to be the next Secretary of State. This doesn’t come as a surprise; he was on the short list behind Hillary Clinton, and has been a stalwart defender of the administration’s foreign policy choices over the last four years. Clinton is a hard act to follow, but there’s little doubt Kerry will perform well in the position. If there’s a problem, it’s that Kerry’s departure from the Senate leaves an open seat in Massachusetts, and as it happens, there’s a former Republican senator—Scott Brown—itching to get back into the game. It helps that he’s still well liked by most Massachusetts voters; a recent poll from MassINC Polling Group shows Brown with high favorability—58 percent, compared to 28 percent who view him unfavorably. The New York Times ’ Nate Silver isn’t so sure that Brown...

Pages