Obama, Boehner Again Square Off On Debt Ceiling

"His bill is one that is not going to get much traction in the Democratic-run Senate largely because it was a bill that was drawn up by House Republicans and probably with collaboration of Senate Republican leader Mitch McConnell," NPR's David Welna said. "But I found it somewhat disingenuous for Boehner to say that this is the bill that's going to solve the problems because he didn't mention the fact that this is a piece of legislation that would require two different votes for raising the debt ceiling: one right now and another probably early next year sometime in the midst of next year's campaigns. That is the biggest objection of the White House to what Boehner is proposing."

The back-to-back televised speeches did little to suggest that a compromise was in the offing, and the next steps appeared to be votes in the House and Senate on the rival plans by mid-week.

"Usually when a president asks for time from the networks to make an evening address and speaker of the House answers him, you'd think they were announcing some kind of historic deal or a solution to the problem," NPR's Liasson said. "Instead they both got up to do what they've been doing more or less for the past several months, which is to explain why the other guy's idea is really bad and why the stalemate is somebody else's fault. And I think the American people and certainly the financial markets are probably running out of patience with this."

But despite warnings to the contrary, U.S. financial markets have appeared to take the political maneuvering in stride so far. Wall Street posted losses Monday but with no indication of panic among investors.

"I think there's still a feeling in the markets that eventually this will be worked out and most importantly the interest rates on Treasury debt remain low and stable. ... and it really hasn't budged much," said Uri Berliner, NPR's business editor.

Without signed legislation by day's end on Aug. 2, the Treasury will be unable to pay all its bills, possibly triggering an unprecedented default that officials warn could badly harm a national economy struggling to recover from the worst recession in decades.

Obama wants legislation that will raise the nation's debt limit by at least $2.4 trillion in one vote, enough to avoid a recurrence of the acrimonious current struggle until after the 2012 elections.

Republicans want a two-step process that would require a second vote in the midst of a campaign for control of the White House and both houses of Congress. Liasson noted that the White House is against this approach, and for a while the House Republican leadership was, too.

But "they [now] feel that every time they have this debate, every time they can talk about a balanced-budged amendment, every time they can put the president on the defensive and say, 'If only you agree to these spending cuts, we would raise the debt ceiling,' they feel that that's actually good for them," she said.

There were concessions from both sides embedded in the competing legislation, but they were largely obscured by the partisan rhetoric of the day.

Senate Republican leader Mitch McConnell of Kentucky urged Obama to shift his position rather than "veto the country into default." And Reid jabbed at Tea Party-backed Republicans who make up a significant portion of the House GOP rank and file. The Nevada Democrat warned against allowing "these extremists" to dictate the country's course."

The measure Boehner and the GOP leadership drafted in the House called for spending cuts and an increase in the debt limit to tide the Treasury over until sometime next year. A second increase in borrowing authority would hinge on approval of additional spending cuts sometime during the election year.

Across the Capitol, Reid wrote legislation that drew the president's backing, praise from House Democratic leader Nancy Pelosi and criticism from Republicans.

The Democrats' measure would cut $2.7 trillion in federal spending and raise the debt limit by $2.4 trillion in one step, enough borrowing authority to meet Obama's bottom-line demand. The cuts include $1.2 trillion from across a range of hundreds of government programs and $1 trillion in savings assumed to derive from the end of the wars in Afghanistan and Iraq.

Material from The Associates Press was used in this report

Source: http://www.npr.org/2011/07/25/138691884/obama-boehner-again-square-off-on-debt-ceiling?ft=1&f=1014

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Obama's 5 big mistakes in debt crisis

Editor's note: David Frum writes a weekly column for CNN.com. A special assistant to President George W. Bush from 2001 to 2002, he is the author of six books, including "Comeback: Conservatism That Can Win Again," and is the editor of FrumForum.

Washington (CNN) -- If the debt ceiling crisis were a movie, President Barack Obama would deserve an Oscar for his performance in the role of "the last reasonable man."

But of course the crisis is not a movie. The crisis is a deadly serious clash of ideas and interests. And there, the president has lost his way

Obama has lost his way so badly that even his core liberal supporters should be questioning whether they have got the right man in the job.

The indictment has five headings:

1. Obama has ceased to lead on the economy.

The management guru Stephen Covey famously said: "The main thing is to keep the main thing the main thing." Economic recovery is -- or should be -- the main thing. In 2009, Obama advanced a series of bold proposals to accelerate recovery: his big fiscal stimulus, the auto bailout and so on.

The president's proposals did not fail, exactly. But they did not work as advertised. The American economy limps weakly forward, leaving millions out of work.

During the Great Depression, President Franklin Roosevelt demanded from his administration "bold, persistent experimentation." By contrast, Obama put measures in place at the beginning and waited for them to yield results. And waited. And waited. And waited.

Finally, at the end of 2010, he added one more measure to the mix: a partial cut to the payroll tax, included as part of the deal that renewed the Bush tax cuts.

The payroll tax holiday is welcome if late. But it was small (2 percentage points out of the 12.6% paid by workers and employers) and was almost immediately offset by the surge in oil prices after the so-called Arab Spring. That surge took back from workers every dollar of the $110 billion in tax relief delivered by the payroll holiday.

And since December, Obama has surrendered entirely to the claim that we can somehow fix the economy by fixing the debt problem. The truth is the opposite: Fix the economy, and the debt problem will shrink to much more manageable proportions.

2. Obama does not effectively use the domestic powers of the presidency.

Talk radio shows accuse Obama of acting like a Third World dictator heading a thug government. That's a devilishly ingenious line of attack on a president who actually makes weaker use of his domestic power than any since Jimmy Carter.

Example: The U.S. recovery that commenced in the summer of 2009 stalled in the spring and summer of 2010. Many economists blame the stall on the Federal Reserve's April 2010 decision to stop providing additional monetary stimulus for fear of igniting inflation. Those inflation fears proved utterly misplaced, and in late 2010 the Federal Reserve resumed its monetary stimulus.

Where was the president during this crucial debate? AWOL.

Yes, yes, the Federal Reserve is independent and all that. But other presidents have succeeded in making their views known and respected on monetary policy. Obama had a unique chance to influence the debate, because through the summer of 2010 two of the seven seats on the Fed's Board of Governors stood vacant. The president nominated expansion-minded governors to fill the seats. The nominations were put on hold by Republican senators. And what did the president do? Did he take to the airways to demand action on his nominees? Did he punish the senators by stopping federal projects in their states? Did he fill the seats with recess appointments?

To borrow the answer from Fred Armisen's imitation of Obama on "Saturday Night Live": "I'm seeing two big accomplishments: jack and squat."

3. Obama cannot communicate empathy for Americans in economic distress.

Remember that video of the Obama supporter expressing her exhaustion and disappointment with the president's record of help to the middle class?

Watch it again, and pay careful attention to what the president does. He first makes a perfunctory effort to connect with the woman in front of him as a fellow-parent. Then he rattles off a list of small programmatic changes: in the student loan program, in credit card regulation, none of them especially relevant to the woman in question. He finishes with a "stay the course" message that must ring hollow in the ears of all those for whom the "course" means unemployment of 38 weeks or longer.

Notice what the president does not do. He does not thank his questioner for defending him. He does not ask her questions of his own. He is so determined to sell his narrative, that he cannot hear or honor her fears. And indeed the questioner did lose her job a few weeks after the town hall meeting.

For two years, Obama's economic message has been "recovery is around the corner." He has delivered this message from factory floors and restaurant tables. He has not spoken in front of groups of unemployed; he has not spoken at welfare offices.

Obama's disconnect from those in distress may explain the remarkable collapse of his support among younger whites, once one of his most important groups of supporters. Pew reports a 10-point surge in Republican identification among whites under age 30 since 2008. These are some of the voters hardest hit by this recession. They are voters to whom this president has spoken least.

4. Obama over-relied on banks and bankers.

Like President George W. Bush before him, Obama took bold and necessary action to save the U.S. financial system in the early spring of 2009. A lot of ugly things were done. A lot of reckless people got away scot-free -- in fact, richer than ever. But apocalypse was averted, so congratulations all around. Afterward though: Where was the reckoning? The administration remained focused on reassuring bankers long after it had finished the job of saving the banks.

Yes, Congress did pass a law, Dodd-Frank, that addressed some of the worst abuses of the 2000s. For example, Dodd-Frank exposes ratings agencies to private lawsuits for "knowing or reckless" failures to conduct proper investigations of the bonds they rate.

Unless you follow banking law closely, however, you would have little idea that any preventive measures have been taken against the next bubble. What got the headlines instead was the president's appointment of one high-profile banker, William Daley, as his chief of staff -- and a rumor that he intended to appoint another as his second secretary of the Treasury, Jamie Dimon of JPMorgan Chase.

Little enough justice was done. Almost none was seen to be done.

5. Obama is not a good negotiator.

It's really striking that any time the president inserts himself into a negotiation, he ends up with zero results and all parties mad at him. The Middle East may be the most extreme case, but there are domestic counterparts, too.

When he negotiated the renewal of the Bush tax cuts in 2010, why didn't he get himself an increase in the debt ceiling at the same time? The tax cuts expanded the deficit beyond what it otherwise would have been. Republicans dearly wanted the tax cuts extended and would have paid for them. But no.

In this round of debt negotiations, the president has drawn red lines. He has threatened to veto a small increase in the debt ceiling, one that would force him to return to the argument before the election in 2012. By contrast, he has not threatened to veto debt-ceiling measures that cut too deeply into social programs. His red lines are drawn for his political advantage -- not to protect his core supporters' values and interests. His red lines are not theirs.

Whether it was health care or the deficit or now the debt ceiling, direct encounters between Obama and his Republican opposite numbers have always ended badly for the president. Yes, the president faces unusually extreme and intransigent opposition. But that's a description of the difficulty, not an excuse for failure. Presidents win negotiations when they can mobilize the public behind them. That was Ronald Reagan's secret weapon in 1981. It has never been Barack Obama's. And the results are as we all see.

The opinions expressed in this commentary are solely those of David Frum.

An earlier version of this commentary incorrectly attributed a quote from Stephen Covey.

Source: http://rss.cnn.com/~r/rss/cnn_allpolitics/~3/qIrQFSi2OzM/index.html

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FAA Suspends Airport Construction Projects Nationwide

The failure of the Senate and House to agree on a bill re-authorizing the FAA to collect certain taxes has meant an end to construction of infrastructure at airports across the country.

Source: http://www.npr.org/blogs/thetwo-way/2011/07/25/138688902/faa-suspends-airport-construction-projects-nationwide?ft=1&f=1003

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Still No Deal, As Rival Debt Plans Are Crafted By Congressional Leaders

Party leaders have abandoned bipartisan budget negotiations and decided to work on two separate plans. But as the political impasse continued, the markets opened lower.

Source: http://www.npr.org/blogs/thetwo-way/2011/07/25/138671356/still-no-deal-as-rival-debt-plans-are-crafted-by-congressional-leaders?ft=1&f=1003

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Gay Marriage Opponents Line Up Legal Challenges

While thousands of same sex couples in New York state line up to get their marriage licenses, opponents of the new law are already looking for legal grounds to overturn the newly passed legislation — and stop efforts to pass similar laws in other states.

Source: http://www.npr.org/2011/07/24/138653391/gay-marriage-opppnents-line-up-legal-challenges?ft=1&f=1003

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EPA Seeks To Tighten Ozone Standards

The Environmental Protection Agency is expected any day now to tighten the standard for how much ozone is safe to breathe, but the level of ozone that scientists say is safe doesn't sit well with industry. The agency decision is sitting at the White House, awaiting approval.

The EPA is redoing the ozone standard set under President George W. Bush. The Bush administration's EPA ignored the advice of its own panel of outside scientific advisers. It set the standard for a healthy level of ozone in the air at 75 parts per billion.

The Obama administration's EPA proposed setting it at between 60 and 70 parts per billion, which is what the scientists recommended. If the agency goes ahead, many communities around the county would soon have more orange and red air pollution-alert days.

George Thurston, a professor of environmental medicine at New York University, says scientific studies make it clear: The air isn't as healthy as the current federal standard suggests it is.

"There are areas of the country that thought their air was safe, but now we can see that there are adverse health effects, significant adverse health effects: hospital admissions, increased risk of death," Thurston says.

Super-hot days like the ones recently are prime time for bad air. That's because when hydrocarbons — like puddles of gasoline or oil — evaporate into the air, they help create ozone. The hotter it is, the more they evaporate. The sun's ultraviolet rays cook these vapors and the exhausts from power plants, vehicles and factories to make smog.

When people breathe in ozone, it can irritate and injure their lungs, almost like a sunburn. Thurston says many scientific studies, including his own, show that ozone triggers attacks in children with asthma.

"Basically the airways start to close up, and they feel like they're breathing through a tiny straw," he says.

People with other lung ailments and young children are also especially vulnerable. Healthy adults who work or exercise outdoors are at risk, too. When the air is bad, it's best for all of these sensitive groups to go outside in the mornings, when ozone levels are lowest.

"The air ought to be safe enough for people to be able to go outside any time, and we shouldn't have to hide inside our homes on high-pollution days," he says. "And that's really what these standards are all about, trying to make it so that our air is safe to breathe."

But it's not going to be easy for the White House to give the EPA the go-ahead on a tougher standard. Industry groups are heaping on the pressure not to act.

The Business Roundtable, a group of CEOs of top companies, sent a letter to the White House warning that strengthening the ozone standard could be the single most expensive regulation ever.

But the Clean Air Act directs the EPA to ignore economic costs and make its decision based only on health implications.

Michael Greenstone, an economist at the Massachusetts Institute of Technology, was in the White House at the beginning of the Obama administration. He says that isn't easy to do, especially when the economy is weak.

"In practice, I think it's very difficult for any administration to be completely blind to economic costs," Greenstone says.

He says the White House shouldn't ignore economics. For example, tougher standards could require companies to install expensive pollution controls. They'll have to charge customers more for electricity and some products.

"When families have less money available, that takes on: the kinds of food they can purchase, the kinds of medicine, the heath care they can seek," he says. "And in its own way, those costs are a very important feature public health, just as cleaner air is."

So far, neither the White House nor the EPA is showing its cards.

Source: http://www.npr.org/2011/07/24/138653373/epa-seeks-to-tighten-ozone-standards?ft=1&f=1003

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