Drivel From the Deficit Hawks

When the US Becomes Greece: Drivel From the Deficit Hawks

by: Dean Baker, t r u t h o u t | Op-Ed

The headlines about Greece's financial problems have provided a great backdrop to renewed attacks from the deficit hawks on Social Security and Medicare. Never mind that none of it really makes any sense. Not making sense is virtually a prerequisite for being taken seriously in Washington policy debates. This is the reason that the characters who could not see an $8 trillion housing bubble dominated debate in the years leading up to the crisis, and still do today.

The deficit hawks tell us that Greece today is where the US will be in ten years. Yeah, the US and Greek economies are virtually spitting images. In fact, they are so similar people often get them mixed up in discussions.

If we get serious, we see that the US and Greece have almost nothing in common. Greece has a small economy that is still largely dependent on tourism and agriculture. It also has a horribly corrupt government. The Organization for Economic Co-Operation and Development estimates that more than 30 percent of its GDP consists of gray market activity that escapes taxation. Even if this figure is exaggerated, the size of the underground economy is certainly much larger in Greece than in the United States.

Greece also has the huge disadvantage of being tied to the euro. This matters for its crisis because currency devaluation, the most obvious mechanism for restoring international competitiveness, is not open to Greece.

By contrast, in spite of the loss of more than one-third of its manufacturing jobs since 1998, the United States remains a manufacturing powerhouse. It's manufacturing sector produced $1.4 trillion in 2007, the last year before the crisis. The United States also has a vibrant high-tech sector and has huge agricultural and tourist sectors.

Suppose the deficit hawks' horror story (dream) comes true and investors lost confidence in the United States. The deficit hawk gang tells us that people will flee the dollar and interest rates will go through the roof.

Does this make sense? Which currency will they opt to hold instead of dollars, euros, yen? As we know, many of the countries in the euro zone have debt burdens that are comparable to those in the United States, and Japan's is actually much larger. If the problem is the debt burden, investors will be going the wrong way in leaving the dollar.

Furthermore, how will these countries feel about a plunging dollar? Will they let the euro rise to be worth two dollars, three dollars? Will the yen be allowed to double in value against the dollar? How many imports will we buy from Europe and Japan if their price doubles or triples to consumers in the United States, which is the direct result of a falling dollar? How much more will we be exporting if the price of US exports falls 50-60 percent?

It is ridiculous to imagine that the governments and central banks of other major countries would allow for the dollar to go into a free fall. Precisely because we are not Greece, but rather the world's largest economy, a sharp plunge in the value of our currency poses more of a threat to other countries than it does to the United States. That is why it is absurd to imagine the same sort of crisis that Greece is seeing hitting the United States in any near-term future scenario.

The same point applies to interest rates. Long-term interest rates will certainly rise from today's extraordinarily low levels, but how high do we think they will go if the economy remains weak? The Fed will presumably keep short-term rates low if the unemployment rate stays high. Will investors prefer to get near zero returns on short-term money than hold US Treasury bonds at a 4.0 percent interest rate? How about a 5.0 percent rate? How about a 6.0 percent rate?

At some point, the gap between the long-term rate and the short-term rate that would be implied is sufficiently large that even a deficit hawk would not try to claim that it is plausible. Higher interest rates are not desirable in a weak economy, but we can live with the sort of interest rates that might plausibly result from any sort of "loss of confidence" that US debt might experience in financial markets.

Of course, the real problem is the spin that we may get from a jump in interest rates. Suppose the yield on ten-year Treasury bonds rose a full percentage point from its current 3.7 percent level to 4.7 percent, a rate that is still below the lowest rates seen in the golden surplus years of the Clinton era. The deficit hawks would be out in force insisting that the financial markets insist that we slash Social Security and Medicare. Given their ability to control public debate, they could win with this line.

So, we have to inoculate the public from deficit-hawk mania. These are the folks who mismanaged the economy through a $10 trillion stock bubble and an $8 trillion housing bubble, causing millions to lose their jobs, homes and life's saving. While they may have impressive credentials, the evidence suggests that they have little understanding of the most fundamental economic facts.

We know that these people don't like Social Security and Medicare. We also know, that when it comes to the economy, they don't know what they are talking about.

http://www.truthout.org/when-us-becomes-greece-drivel-from-deficit-hawks57688

Making a Difference

While walking along the beach, a man saw someone in the distance leaning down, picking something up, and throwing it into the ocean. As he came closer, he saw thousands of starfish the tide had thrown onto the beach. Unable to return to the ocean during the low tide, the starfish were dying. He observed a young man picking up the starfish one by one and throwing them back into the water. After watching the seemingly futile effort, the observer said, "There must be thousands of starfish on this beach. It would be impossible for you to get all of them. There are simply too many. You can't possibly save enough to make a difference." The young man smiled as he continued to pick up another starfish and toss it back into the ocean. "It made a difference to that one," he replied.
--Author Unknown

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"There is a terrible forest fire. All the animals are fleeing the conflagration except Hummingbird, who is flying back and forth, scooping up little slivers of water from a spring and dumping them on the flames. 'What do you think you're doing, stupid little bird?' the other animals ask derisively, and Hummingbird says, 'I'm doing what I can"
--Wangari Maathai, Nobel Prize-winning founder of Kenya's Greenbelt Movement

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(Thanks to Terry Clark for these, and so may other great quotes!)

Do the Right Thing

I know there are those (including Democracy for America) who are calling for the Congress to use reconciliation to pass a health care bill, but I find Paul Krugman's argument (see below) even more compelling, that the House should just pass the Senate's version of the bill, flaws and all, and then they can set to work improving on it, including with the use of reconciliation, where that's appropriate.

Here's what you can do now, to make this happen.:

Call toll free to any Congressional member 1-800-828-0498
and/or
Send an email to your congress member here: https://writerep.house.gov/htbin/wrep_findrep

and tell them to pass the Senate's Health Choices Act.


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January 22, 2010

Do the Right Thing

By PAUL KRUGMAN nytimes.com

A message to House Democrats: This is your moment of truth. You can do the right thing and pass the Senate health care bill. Or you can look for an easy way out, make excuses and fail the test of history.

Tuesday’s Republican victory in the Massachusetts special election means that Democrats can’t send a modified health care bill back to the Senate. That’s a shame because the bill that would have emerged from House-Senate negotiations would have been better than the bill the Senate has already passed. But the Senate bill is much, much better than nothing. And all that has to happen to make it law is for the House to pass the same bill, and send it to President Obama’s desk.

Right now, Nancy Pelosi, the speaker of the House, says that she doesn’t have the votes to pass the Senate bill. But there is no good alternative.

Some are urging Democrats to scale back their proposals in the hope of gaining Republican support. But anyone who thinks that would work must have spent the past year living on another planet.

The fact is that the Senate bill is a centrist document, which moderate Republicans should find entirely acceptable. In fact, it’s very similar to the plan Mitt Romney introduced in Massachusetts just a few years ago. Yet it has faced lock-step opposition from the G.O.P., which is determined to prevent Democrats from achieving any successes. Why would this change now that Republicans think they’re on a roll?

Alternatively, some call for breaking the health care plan into pieces so that the Senate can vote the popular pieces into law. But anyone who thinks that would work hasn’t paid attention to the actual policy issues.

Think of health care reform as being like a three-legged stool. You would, rightly, ridicule anyone who proposed saving money by leaving off one or two of the legs. Well, those who propose doing only the popular pieces of health care reform deserve the same kind of ridicule. Reform won’t work unless all the essential pieces are in place.

Suppose, for example, that Congress took the advice of those who want to ban insurance discrimination on the basis of medical history, and stopped there. What would happen next? The answer, as any health care economist will tell you, is that if Congress didn’t simultaneously require that healthy people buy insurance, there would be a “death spiral”: healthier Americans would choose not to buy insurance, leading to high premiums for those who remain, driving out more people, and so on.

And if Congress tried to avoid the death spiral by requiring that healthy Americans buy insurance, it would have to offer financial aid to lower-income families to make that insurance affordable — aid at least as generous as that in the Senate bill. There just isn’t any way to do reform on a smaller scale.

So reaching out to Republicans won’t work, and neither will trying to pass only the crowd-pleasing pieces of reform. What about the suggestion that Democrats use reconciliation — the Senate procedure for finalizing budget legislation, which bypasses the filibuster — to enact health reform?

That’s a real option, which may become necessary (and could be used to improve the Senate bill after the fact). But reconciliation, which is basically limited to matters of taxing and spending, probably can’t be used to enact many important aspects of reform. In fact, it’s not even clear if it could be used to ban discrimination based on medical history.

Finally, some Democrats want to just give up on the whole thing.

That would be an act of utter political folly. It wouldn’t protect Democrats from charges that they voted for “socialist” health care — remember, both houses of Congress have already passed reform. All it would do is solidify the public perception of Democrats as hapless and ineffectual.

And anyway, politics is supposed to be about achieving something more than your own re-election. America desperately needs health care reform; it would be a betrayal of trust if Democrats fold simply because they hope (wrongly) that this would slightly reduce their losses in the midterm elections.

Now, part of Democrats’ problem since Tuesday’s special election has been that they have been waiting in vain for leadership from the White House, where Mr. Obama has conspicuously failed to rise to the occasion.

But members of Congress, who were sent to Washington to serve the public, don’t have the right to hide behind the president’s passivity.

Bear in mind that the horrors of health insurance — outrageous premiums, coverage denied to those who need it most and dropped when you actually get sick — will get only worse if reform fails, and insurance companies know that they’re off the hook. And voters will blame politicians who, when they had a chance to do something, made excuses instead.

Ladies and gentlemen, the nation is waiting. Stop whining, and do what needs to be done.

SUPREME COURT RULING ON ELECTIONS

For anyone who said there was no difference between Gore and Bush, or Kerry and Bush, or who thinks Obama is just the same as a Republican would be, here in is the difference, that is, the make up of the Supreme Court. We will be living under the Bush regime for as long as his appointments are in the majority.

(Take action here: www.SaveDemocracy.net )

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Manchurian Candidates:
Supreme Court allows China and others unlimited spending in US elections


By Greg Palast gregpalast.com
Thursday, January 21, 2010

In today's Supreme Court decision in Citizens United v. Federal Election Commission, the Court ruled that corporations should be treated the same as "natural persons", i.e. humans. Well, in that case, expect the Supreme Court to next rule that Wal-Mart can run for President.

The ruling, which junks federal laws that now bar corporations from stuffing campaign coffers, will not, as progressives fear, cause an avalanche of corporate cash into politics. Sadly, that's already happened: we have been snowed under by tens of millions of dollars given through corporate PACs and "bundling" of individual contributions from corporate pay-rollers.

The Court's decision is far, far more dangerous to U.S. democracy. Think: Manchurian candidates.

I'm losing sleep over the millions - or billions - of dollars that could flood into our elections from ARAMCO, the Saudi Oil corporation's U.S. unit; or from the maker of "New Order" fashions, the Chinese People's Liberation Army. Or from Bin Laden Construction corporation. Or Bin Laden Destruction Corporation.

Right now, corporations can give loads of loot through PACs. While this money stinks (Barack Obama took none of it), anyone can go through a PAC's federal disclosure filing and see the name of every individual who put money into it. And every contributor must be a citizen of the USA.

But under today's Supreme Court ruling that corporations can support candidates without limit, there is nothing that stops, say, a Delaware-incorporated handmaiden of the Burmese junta from picking a Congressman or two with a cache of loot masked by a corporate alias.

Candidate Barack Obama was one sharp speaker, but he would not have been heard, and certainly would not have won, without the astonishing outpouring of donations from two million Americans. It was an unprecedented uprising-by-PayPal, overwhelming the old fat-cat sources of funding.

Well, kiss that small-donor revolution goodbye. Under the Court's new rules, progressive list serves won't stand a chance against the resources of new "citizens" such as CNOOC, the China National Offshore Oil Corporation. Maybe UBS (United Bank of Switzerland), which faces U.S. criminal prosecution and a billion-dollar fine for fraud, might be tempted to invest in a few Senate seats. As would XYZ Corporation, whose owners remain hidden by "street names."

George Bush's former Solicitor General Ted Olson argued the case to the court on behalf of Citizens United, a corporate front that funded an attack on Hillary Clinton during the 2008 primary. Olson's wife died on September 11, 2001 on the hijacked airliner that hit the Pentagon. Maybe it was a bit crude of me, but I contacted Olson's office to ask how much "Al Qaeda, Inc." should be allowed to donate to support the election of his local congressman.

Olson has not responded.

The danger of foreign loot loading into U.S. campaigns, not much noted in the media chat about the Citizens case, was the first concern raised by Justice Ruth Bader Ginsburg, who asked about opening the door to "mega-corporations" owned by foreign governments. Olson offered Ginsburg a fudge, that Congress might be able to prohibit foreign corporations from making donations, though Olson made clear he thought any such restriction a bad idea.

Tara Malloy, attorney with the Campaign Legal Center of Washington D.C. says corporations will now have more rights than people. Only United States citizens may donate or influence campaigns, but a foreign government can, veiled behind a corporate treasury, dump money into ballot battles.

Malloy also noted that under the law today, human-people, as opposed to corporate-people, may only give $2,300 to a presidential campaign. But hedge fund billionaires, for example, who typically operate through dozens of corporate vessels, may now give unlimited sums through each of these "unnatural" creatures.

And once the Taliban incorporates in Delaware, they could ante up for the best democracy money can buy.

In July, the Chinese government, in preparation for President Obama's visit, held diplomatic discussions in which they skirted issues of human rights and Tibet. Notably, the Chinese, who hold a $2 trillion mortgage on our Treasury, raised concerns about the cost of Obama's health care reform bill. Would our nervous Chinese landlords have an interest in buying the White House for an opponent of government spending such as Gov. Palin? Ya betcha!

The potential for foreign infiltration of what remains of our democracy is an adjunct of the fact that the source and control money from corporate treasuries (unlike registered PACs), is necessarily hidden. Who the heck are the real stockholders? Or as Butch asked Sundance, "Who are these guys?"
We'll never know.

Hidden money funding, whether foreign or domestic, is the new venom that the Court has injected into the system by its expansive decision in Citizens United.

We've been there. The 1994 election brought Newt Gingrich to power in a GOP takeover of the Congress funded by a very strange source.

Congressional investigators found that in crucial swing races, Democrats had fallen victim to a flood of last-minute attack ads funded by a group called, "Coalition for Our Children's Future." The $25 million that paid for those ads came, not from concerned parents, but from a corporation called "Triad Inc."

Evidence suggests Triad Inc. was the front for the ultra-right-wing billionaire Koch Brothers and their private petroleum company, Koch Industries. Had the corporate connection been proven, the Kochs and their corporation could have faced indictment under federal election law. As of today, such money-poisoned politicking has become legit.

So it's not just un-Americans we need to fear but the Polluter-Americans, Pharma-mericans, Bank-Americans and Hedge-Americans that could manipulate campaigns while hidden behind corporate veils. And if so, our future elections, while nominally a contest between Republicans and Democrats, may in fact come down to a three-way battle between China, Saudi Arabia and Goldman Sachs.
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Greg Palast is the author of the New York Times bestseller The Best Democracy Money Can Buy." Palast investigated Triad Inc. for The Guardian (UK). View Palast's reports for BBC TV and Democracy Now! at gregpalast.com.
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Take Action Now
Six bills have been filed in Congress to reverse this assault, the "Save Our Democracy" package. Sign this petition today, and show your support for saving our democracy: www.SaveDemocracy.net

Jim DeMint fears unions more then terrorist

By Megan Carpentier for Air America

Republican Senator Jim DeMint cares more about whether security screeners can unionize than whether bombs get on planes--or at least that's what his legislative record shows. Ben Smith of Politico reports that even as Umar Farouk Abdulmutallab was plotting his attack on the United States, DeMint was holding up the confirmation of the new head of the Transportation Security Administration to try to make sure the people who are in the front lines of securing America's skies can't unionize. For DeMint, the unionization of the people paid to keep terrorists and their weapons off planes is a greater threat to this nation than the terrorists plotting the deaths of Americans.

And DeMint's not the only one who thinks that the GOP's pet projects and their personal feelings are more important than the safety of individual Americans. Leading House Republicans including Minority Leader John Boehner, Michigan's own Pete Hoekstra, Indiana's Mike Pence, Paul Ryan of Wisconsin, Michelle Bachmann, Marsha Blackburn of Tennessee, Darrell Issa of California, and Joe "You Lie!" Wilson voted against the appropriations bill that would have provided money to the Transportation Security Administration--including for increased bomb detection--out of a sense of pique over a procedural disagreement that they lost. I'm sure that seems quite important now.

So, will DeMint release his hold on the TSA nominee? His appearance on "Fox News Sunday" indicates that, to this say, he believes unionization to be as big a threat as ever and, until he isn't faced with the possibility of TSA screeners collectively bargaining for pay increases to keep this nation safe, he's not going to let any Obama nominee take the helm of the agency charged with keeping the skies safe. One must have one's priorities, after all.

http://airamerica.com/politics/12-28-2009/gop-playing-politics-air-security-our-safety/

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If you think Jim Demint should stop playing politics with our safety, let him know:

Senator Jim DeMint
340 Russell
United States Senate
Washington, DC 20510
Phone: 202-224-6121
Fax: 202-228-5143
or by email: http://demint.senate.gov/public/index.cfm?FuseAction=Contact.Home

Here are some more articles on the blocked appointment:
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Who's Running the TSA? No One, Thanks to Sen. Jim DeMint
Monday 28 December 2009
by: Margaret Talev | McClatchy Newspapers

Washington - An attempt to blow up a trans-Atlantic flight from Amsterdam to Detroit on Christmas Day would be all-consuming for the administrator of the Transportation Security Administration — if there were one.

The post remains vacant because Sen. Jim DeMint, R-S.C., has held up President Barack Obama's nominee in opposition to the prospect of TSA workers joining a labor union.

As al Qaida claimed responsibility Monday for the thwarted attack and President Barack Obama made a public statement about it, Democrats urged DeMint to drop his objection and allow quick confirmation of nominee Erroll Southers, a counterterrorism expert, when the Senate reconvenes in three weeks.

Obama, speaking from Hawaii, where he and his family are vacationing, told Americans, "We will not rest until we find all who were involved and hold them accountable."

Obama warned anyone plotting against the U.S. from Afghanistan, Pakistan, Yemen, Somalia or elsewhere that he doesn't intend to rest at simply strengthening defense.

The Senate Homeland Security and Governmental Affairs Committee announced a hearing to be set for next month to examine how Umar Farouk Abdulmutallab, a 23-year-old Nigerian whose name was in a terrorism database, boarded a plane with explosive material.

"Why aren't airline passengers flying into the U.S. checked against the broadest terrorist database and why isn't whole body scanning technology that can detect explosives in wider use?" said committee chairman Sen. Joseph Lieberman, a Connecticut independent.

Meanwhile, Florida Republican Rep. John Mica said in a statement that the TSA had grown lost and bloated in bureaucracy and called for a review.

Mica also said Congress "must change the process by which TSA administrators serve. There has been no TSA administrator for nearly a year and the next one will be the fifth in eight years. Running a security agency with a revolving door is a recipe for failure."

Janet Napolitano, the head of the Department of Homeland Security, of which the TSA is part, made the rounds of morning television news programs on Monday, backing away from her initial stance that the system had worked in averting attack.

She told NBC that "our system did not work in this instance. No one is happy or satisfied with that. An extensive review is under way."

Southers, a former FBI special agent, is the Los Angeles World Airports Police Department assistant chief for homeland security and intelligence. He also is the associate director of the University of Southern California's Center for Risk and Economic Analysis of Terrorism Events, and he served as a deputy director of homeland security for California Republican Gov. Arnold Schwarzenegger.

Two Senate committees have given Southers their bipartisan blessing. An acting administrator is in place pending his confirmation.

Marshall McClain, the president of the Los Angeles Airport Peace Officers Association, said that the Senate should have acted sooner to confirm Southers.

"Friday's terrorist attack on U.S. aviation makes it all the more imperative that there be no further delays in filling this crucial position," he said.

DeMint said in a statement that the attempted attack "is a perfect example of why the Obama administration should not unionize the TSA." He wants Southers to clarify his stand on unionizing the TSA, a shift that Democrats support.

Without collective bargaining, DeMint said, the TSA has "flexibility to make real-time decisions that allowed it to quickly improve security measures in response to this attempted attack."

If organized labor got involved, DeMint said, union bosses would have the power "to veto or delay future security improvements at our airports."

He urged Obama to "re-think" supporting unionizing the TSA "and put the interests of American travelers ahead of organized labor."

DeMint also wants a Senate floor debate and roll call votes, not confirmation by consent as the Democrats sought.

Senate Majority Leader Harry Reid, D-Nev., hadn't scheduled a floor vote for Southers before the Senate left town on Christmas Eve.

Reid spokesman Jim Manley said Monday that the majority leader is working with the White House to get Southers confirmed "as quickly as possible" and charged that "Republican obstructionism has prevented TSA from having the leadership in place that the organization deserves."

DeMint spokesman Wesley Denton said that Obama didn't nominate Southers until September, and he charged that Reid "has been too busy trading earmarks for votes on health care" to deal with DeMint's concerns.

DeMint's objection creates a procedural hurdle that could take three days of debate and test votes to overcome, or could potentially be limited if Democrats offered DeMint a compromise. No one was taking conciliatory stance on Monday, however. Manley called DeMint's opposition "disgraceful."

(Lesley Clark contributed to this article.

http://www.truthout.org/topstories/122809ms1

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December 29, 2009
DeMint defends blocking appointment of TSA chief
Posted: December 29th, 2009

Washington (CNN) - Elected officials on Capitol Hill are planning to hold hearings in January to investigate the safety gaps in airline security, made more pronounced since the attempted bombing over Detroit on Christmas Day.

But one important officeholder, the administrator of the Transportation Security Administration, likely won't be present at any of the hearings - simply because his nomination is being blocked in the Senate.

Sen. Jim DeMint, R-South Carolina, has been holding up the confirmation of Erroll Southers to be TSA chief, in an effort to prevent TSA employees from joining a labor union. Southers is a former FBI special agent and counterterrorism expert.

"The attempted terror attack in Detroit is a perfect example of why the Obama Administration should not unionize the TSA and allow our airline security decisions to be dictated by union bosses," DeMint said in a statement. "I hope this incident will lead the President to re-think this policy and put the interests of American travelers ahead of organized labor."

DeMint points to inefficiencies that will arise from the organizing of TSA employees, which he says may ultimately jeopardize the safety of Americans, such as the inability of rewarding exceptional screeners and firing those who are underperforming, the inflexibility to change protocols as emergency situations arise, and the need to require more collective bargaining as new safety mechanisms create new job descriptions.

A spokesman for Senate Majority Leader Harry Reid contends that Democrats "have been trying to confirm Mr. Southers" since his nomination was approved by two separate Senate committees.

"Sadly the Republican obstructionism of just one person, Senator Demint, prevented TSA from having the leadership in place that the organization deserves," said Reid spokesman Jim Manley.

But the largest organizer of transportation security officers, the American Federation of Government Employees, disagrees with DeMint's central claims against unionization – citing the unobstructed cooperation by union members of both the New York City police and fire departments in the aftermath of the September 11attacks.

"This is not an issue of security. There is no evidence that labor rights have any effect on transportation security officers," said Emily Ryan, spokeswoman for AFGE.

AFGE represents 12,000 of TSA's nearly 40,000 transportation security officers in many personnel matters, while also overseeing the broader collective bargaining of nearly 40,000 other government employees at the Department of Homeland Security, including the Coast Guard, Immigrations and Customs Enforcement and the Federal Emergency Management Agency.

"This is a dedicated workforce who see their jobs as important to the security of the nation," said Ryan.

While Southers' nomination is being blocked, there is an acting administrator of the TSA running the agency.

http://politicalticker.blogs.cnn.com/2009/12/29/demint-defends-blocking-appointment-of-tsa-chief/

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White House defends nominee to head TSA, says delay is based on politics


HONOLULU (AP) — Acknowledging he has given inconsistent answers to Congress, President Barack Obama's pick to lead the Transportation Security Administration wrote to lawmakers to explain a reprimand he received for running background checks on his then-estranged wife's boyfriend two decades ago.

Erroll Southers, a former FBI agent whose nomination has been delayed by Republicans for unrelated concerns, sent a letter to senators in November to correct what he called a distortion of his record. As Democrats push for his speedy confirmation, the chairman of the Senate Homeland Security Committee said he maintained faith in the nominee.

"I am distressed by the inconsistencies between my recollection and the contemporaneous documents, but I assure you that the mistake was inadvertent, and that I have at all times taken full responsibility for what I know to have been a grave error in judgment," he wrote in a letter to Sens. Joe Lieberman, I-Conn., and Susan Collins, R-Maine.

"This incident was over 20 years ago, I was distraught and concerned about my young son, and never in my career since has there been any recurrence of this sort of conduct."

In an October affidavit for the Senate committee, he initially said he asked a San Diego police employee to run a background check on his then-estranged wife's boyfriend and was censured by his FBI superiors 20 years ago for what he said was an isolated instance.

But a day after the committee approved his nomination and sent it to the full Senate, he wrote to the senators and told them that he was incorrect, that he twice ran background checks himself.

In the letter correcting the record, Southers also said he downloaded law enforcement records and shared them. He said he forgot the incident in 1987 or 1988.

The letter was first reported by The Washington Post's Web site on Thursday. The letter, which was distributed to all members of the Homeland Security Committee and whose contents were verified to The Associated Press by a Democratic source, was dated Nov. 20.

Lieberman aide Leslie Phillips said the senator continues to support Southers.

"Twenty years ago, Mr. Southers committed a serious error in judgment," Phillips said. "He admitted that error and was disciplined for it. He went on to develop broad knowledge and build an excellent reputation in the areas of security and law enforcement. Mr. Southers was forthcoming about his past censure during his nomination process and about errors he made in recalling the details."

White House officials lined up behind Southers' nomination to head a Transportation Department agency that lacked a confirmed chief when a suspected terrorist failed to destroy a Detroit-bound airliner on Christmas Day.

"Southers has never tried to hide this incident and has expressed that these were errors he made in judgment that he deeply regretted and an error that he made in an account of events that happened over 20 years ago," said Nick Shapiro, a White House spokesman traveling with Obama on vacation in Hawaii.

"Southers' nomination has not been held up over this as he has been entrusted with significant and increasing responsibilities in the area of homeland security over the years since, but he is being held up by Sen. (Jim) DeMint over a political issue."

Southers' nomination has been delayed by DeMint, a South Carolina Republican, who said he feared TSA employees would join unions with Southers' support. Majority Leader Harry Reid, D-Nev., said he would force a vote on Southers by the full Senate in the new year, his spokesman said.

Southers' nomination secured the backing from former colleagues, including the Republican governor of California who nominated him as his No. 2 homeland security adviser and has known Southers for 30 years, back to his days as a Santa Monica police officer.

"Erroll brings vast homeland security experience at the federal, state and local levels, along with hands on airport security expertise," Gov. Arnold Schwarzenegger said in a statement. "California is safer and better prepared because of his hard work and dedication. Erroll is a committed public servant and highly qualified for the role."

His former boss also praised Southers' character.

"He is a man of unquestioned integrity who, for the past 30 years, has dedicated his life to public service," wrote Ronald Iden, now chief security officer for the Walt Disney Co., who brought Southers on as his deputy at the California homeland security office in 2004. His was among the letters sent to the Senate in support of Southers' nomination.

Southers is the assistant chief of the Los Angeles World Airports Police Department. He previously taught at the University of Southern California, was a security consultant and a police officer.

http://www.latimes.com/news/nationworld/nation/wire/sns-ap-us-obama-tsa,0,4279848.story

Ted Kennedy's widow on the bill passing the Senate

The moment Ted Kennedy would not want to lose
By Victoria Reggie Kennedy
Sunday, December 20, 2009; A19

My late husband, Ted Kennedy, was passionate about health-care reform. It was the cause of his life. He believed that health care for all our citizens was a fundamental right, not a privilege, and that this year the stars -- and competing interests -- were finally aligned to allow our nation to move forward with fundamental reform. He believed that health-care reform was essential to the financial stability of our nation's working families and of our economy as a whole.

Still, Ted knew that accomplishing reform would be difficult. If it were easy, he told me, it would have been done a long time ago. He predicted that as the Senate got closer to a vote, compromises would be necessary, coalitions would falter and many ardent supporters of reform would want to walk away. He hoped that they wouldn't do so. He knew from experience, he told me, that this kind of opportunity to enact health-care reform wouldn't arise again for a generation.

In the early 1970s, Ted worked with the Nixon administration to find consensus on health-care reform. Those efforts broke down in part because the compromise wasn't ideologically pure enough for some constituency groups. More than 20 years passed before there was another real opportunity for reform, years during which human suffering only increased. Even with the committed leadership of then-President Bill Clinton and his wife, reform was thwarted in the 1990s. As Ted wrote in his memoir, he was deeply disappointed that the Clinton health-care bill did not come to a vote in the full Senate. He believed that senators should have gone on the record, up or down.

Ted often said that we can't let the perfect be the enemy of the good. He also said that it was better to get half a loaf than no loaf at all, especially with so many lives at stake. That's why, even as he never stopped fighting for comprehensive health-care reform, he also championed incremental but effective reforms such as a Patients' Bill of Rights, the Children's Health Insurance Program and COBRA continuation of health coverage.

The bill before the Senate, while imperfect, would achieve many of the goals Ted fought for during the 40 years he championed access to quality, affordable health care for all Americans. If this bill passes:

-- Insurance protections like the ones Ted fought for his entire life would become law.

-- Thirty million Americans who do not have coverage would finally be able to afford it. Ninety-four percent of Americans would be insured. Americans would finally be able to live without fear that a single illness could send them into financial ruin.

-- Insurance companies would no longer be able to deny people the coverage they need because of a preexisting illness or condition. They would not be able to drop coverage when people get sick. And there would be a limit on how much they can force Americans to pay out of their own pockets when they do get sick.

-- Small-business owners would no longer have to fear being forced to lay off workers or shut their doors because of exorbitant insurance rates. Medicare would be strengthened for the millions of seniors who count on it.

-- And by eliminating waste and inefficiency in our health-care system, this bill would bring down the deficit over time.

Health care would finally be a right, and not a privilege, for the citizens of this country. While my husband believed in a robust public option as an effective way to lower costs and increase competition, he also believed in not losing sight of the forest for the trees. As long as he wasn't compromising his principles or values, he looked for a way forward.

As President Obama noted to Congress this fall, for Ted, health-care reform was not a matter of ideology or politics. It was not about left or right, Democrat or Republican. It was a passion born from the experience of his own life, the experience of our family and the experiences of the millions of Americans across this country who considered him their senator, too.

The bill before Congress will finally deliver on the urgent needs of all Americans. It would make their lives better and do so much good for this country. That, in the end, must be the test of reform. That was always the test for Ted Kennedy. He's not here to urge us not to let this chance slip through our fingers. So I humbly ask his colleagues to finish the work of his life, the work of generations, to allow the vote to go forward and to pass health-care reform now. As Ted always said, when it's finally done, the people will wonder what took so long.

Victoria Reggie Kennedy, the widow of Sen. Edward M. Kennedy (D-Mass.), is an attorney.

http://www.washingtonpost.com/wp-dyn/content/article/2009/12/18/AR2009121803506_pf.html

Let Wall St. Pay for Its Own Bailout!

Let Wall Street Pay for Wall Street's Bailout Act of 2009 (Introduced in House)
HR 1068 IH

111th CONGRESS
1st Session

H. R. 1068
To amend the Internal Revenue Code of 1986 to impose a tax on certain securities transactions to the extent required to recoup the net cost of the Troubled Asset Relief Program.


IN THE HOUSE OF REPRESENTATIVES
February 13, 2009

Mr. DEFAZIO (for himself, Mr. WELCH, Ms. SUTTON, Mr. CAPUANO, Mr. WU, Mr. STARK, Ms. DELAURO, and Ms. EDWARDS of Maryland) introduced the following bill; which was referred to the Committee on Ways and Means


A BILL
To amend the Internal Revenue Code of 1986 to impose a tax on certain securities transactions to the extent required to recoup the net cost of the Troubled Asset Relief Program.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.

This Act may be cited as the `Let Wall Street Pay for Wall Street's Bailout Act of 2009'.
SEC. 2. FINDINGS.

Congress finds the following:
(1) The Bush Administration allocated the first $350 billion of TARP funds in a manner that has outraged the Nation by failing to provide the most basic oversight of the funds.
(2) Congress has declined to block the remaining $350 billion of TARP funds despite the lack of oversight and the record fiscal year 2009 budget deficit estimated at $1.2 trillion.
(3) The Board of Governors of the Federal Reserve System has committed more than a trillion dollars to stabilize the economy by bailing out various banks deemed `too big to fail'.
(4) The $700 billion TARP fund and the new Federal Reserve lending facilities were created to protect Wall Street investors; therefore, the same Wall Street investors should pay for this infusion of taxpayer money.
(5) The easiest method to raise the money from Wall Street is a securities transfer tax, a tax that has a negligible impact on the average investor.
(6) This transfer tax would be on the sale and purchase of financial instruments such as stock, options, and futures. A quarter percent (0.25 percent) tax on financial transactions could raise approximately $150 billion a year.
(7) The United States had a transfer tax from 1914 to 1966. The Revenue Act of 1914 (Act of Oct. 22, 1914 (ch. 331, 38 Stat. 745)) levied a 0.2 percent tax on all sales or transfers of stock. In 1932, Congress more than doubled the tax to help overcome the budgetary challenges during the Great Depression.
(8) All revenue generated by this transfer tax should be deposited in the general fund of the Treasury of the United States, scaled to meet the net cost of these bailouts, and phase out when the cost of the bailouts are repaid.
SEC. 3. RECOUPMENT OF DEFICIT ARISING FROM FEDERAL BAILOUT.

(a) In General- Chapter 36 of the Internal Revenue Code of 1986 is amended by inserting after subchapter B the following new subchapter:
`Subchapter C--Tax on Securities Transactions

`Sec. 4475. Tax on securities transactions.
`SEC. 4475. TAX ON SECURITIES TRANSACTIONS.

`(a) Imposition of Tax- There is hereby imposed a tax on each covered securities transaction an amount equal to the applicable percentage of the value of the security involved in such transaction.
`(b) By Whom Paid- The tax imposed by this section shall be paid by the trading facility on which the transaction occurs.
`(c) Applicable Percentage- For purposes of this section--
`(1) IN GENERAL- The term `applicable percentage' means the lesser of--
`(A) the specified percentage, or
`(B) 0.25 percent.
`(2) SPECIFIED PERCENTAGE-
`(A) IN GENERAL- The term `specified percentage' means, with respect to any taxable year beginning in a calendar year, the percentage that the Secretary estimates would result in the aggregate revenue to the Treasury under this section for such taxable year and all prior taxable years to equal the Secretary's estimate of the net cost (if any) to the Federal Government of--
`(i) carrying out the Troubled Asset Relief Program established under title 1 of the Emergency Economic Stabilization Act of 2008, and
`(ii) the exercise of authority by the Board of Governors of the Federal Reserve System under the third undesignated paragraph of section 13 of the Federal Reserve Act (12 U.S.C. 343).
`(B) DETERMINATION OF PERCENTAGE- Such percentage shall be determined by the Secretary not later than 30 days after the date of the enactment of this section, and redetermined for taxable years beginning in each calendar year thereafter. Such percentage shall take into account the Secretary's most recent estimation of such net cost. Any specified percentage determined under this paragraph which is not a multiple of 1/100th of a percentage point shall be rounded to the nearest 1/100th of a percentage point.
`(d) Covered Securities Transaction- The term `covered securities transaction' means--
`(1) any transaction to which subsection (b), (c), or (d) of section 31 of the Securities Exchange Act of 1934 applies, and
`(2) any transaction subject to the exclusive jurisdiction of the Commodity Futures Trading Commission.
`(e) Administration- The Secretary shall carry out this section in consultation with the Securities and Exchange Commission and the Commodity Futures Trading Commission.'.
(b) Clerical Amendment- The table of subchapters for chapter 36 of such Code is amended by inserting after the item relating to subchapter B the following new item:
`subchapter c. tax on securities transactions'.

(c) Effective Date- The amendments made by this section shall apply to sales occurring more than 30 days after the date of the enactment of this Act.

http://thomas.loc.gov/cgi-bin/query/z?c111:H.R.1068: