Obama: Banks need more help; some may fail

Posted by Irati on February 3, 2009 under Articles, News | Be the First to Comment

WASHINGTON (AP) — In a sobering appraisal of the nation’s banking system, President Barack Obama signaled Monday that he will need more money to bail out the battered financial industry. Even so, he said, “some banks won’t make it.”

Neither Obama nor other administration officials said how much a renewed rescue plan might cost. It is possible that additional help could come from the Federal Reserve, not from Congress.

Still, Obama’s acknowledgment reinforced what many economists and bank industry officials have speculated for weeks.

“We can expect that we’re going to have to do more to shore up the financial system,” Obama said.

Treasury Secretary Timothy Geithner plans to announce a new framework for rescuing the financial sector in a speech next week. The plans will focus on how to use the remaining $350 billion in a $700 billion Troubled Asset Relief program that Congress approved in the fall. It will include new programs aimed at helping homeowners stave off foreclosure, and efforts to stabilize the banking sector.

Top Treasury officials met over the weekend with representatives of the financial industry and other policy makers to discuss a number of possible rescue plans. One is a government-run “bad bank” that take on the bad debts and investments of financial institutions.

In addition, the Treasury could seek help from the Federal Reserve and the Federal Deposit Insurance Corp. to provide banks with guarantees against losses on assets backed by residential and commercial real estate loans, as the government did with Citigroup Inc. in November. And it may also continue the current practice of infusing capital into banks in hopes of easing credit.

The president declined to answer specifically when asked in an NBC interview whether he planned to set up a so-called “bad bank.” He suggested, however, that something like that was under consideration, and that taxpayers would become owners of stock in those banks and investment houses.

“We’re going to have to wring out some of these bad assets,” he said.

Obama said some of the nation’s banks would have to write down bad debts, while other banks may fail.

“It is likely that the banks have not fully acknowledged all the losses that they’re going to experience. They’re going to have to write down those losses. And some banks won’t make it,” he said.

The “bad bank” idea is especially complicated because of the difficulties in determining how much the new bank would pay for distressed assets. Paying a high price could leave taxpayers exposed to billions of dollars in losses; paying too little might not give banks enough money to loosen credit.

One lobbyist familiar with the discussions said the administration is also trying to decide whether to ask Congress to change an accounting rule that affects how assets are priced. Suspending the rule would prevent distressed assets from further markdowns.

The Obama administration has also promised to spend between $50 billion and $100 billion to reduce foreclosures. That, too, is tricky and requires policies that won’t reward irresponsible borrowers or simply put off foreclosure temporarily.

Administration officials had said last week they planned to release their financial sector roadmap this week, but on Monday made it clear nothing would be rolled out until next week.

The administration’s work on the financial bailout is operating on parallel tracks — one devoted to how the money will be spent and the other on what conditions to place on recipients of the funds and how to better track the money.

Treasury is expected to announce new rules that limit executive pay for companies that receive “exceptional assistance” under the bailout program.

Obama reacted strongly last week to reports that banks gave than $18 billion of bonuses at a time when they were relying on taxpayer money for their survival.

The new rules would not apply to banks receiving direct capital injections. Those banks generally are considered to be healthy, and the bailout money is intended to support their lending activity.

In the Senate, Republican leader Mitch McConnell, R-Ky., urged the administration to proceed with caution.

“I think we’re all appalled by these — some of these executive salary arrangements and bonus arrangements and perks and all the rest,” he said. “On the other hand, I really don’t want the government to take over these businesses and start telling them everything about what they can do. Then you truly have nationalized the business.”

By JIM KUHNHENN

Associated Press Writer Daniel Wagner and White House Correspondent Jennifer Loven contributed to this story.

www.google.com/hostednews/ap

Obama calls Iraqi leaders, South Korean president

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WASHINGTON (AP) — President Barack Obama telephoned Iraqi Prime Minister Nouri al-Maliki and Iraqi President Jalal Talabani on Monday to congratulate them on the provincial elections held over the weekend. Obama also spoke with South Korea’s president.

Obama offered both Iraqi leaders the best wishes of the American people as their country’s new provincial leaders prepare to assume important new responsibilities, White House press secretary Robert Gibbs said in a statement.

An Iraqi electoral commission official said Monday that it could take several days to count all the ballots from the voting, which took place across the country during the weekend under tight security and with remarkably little violence.

Obama also described the review of planning on options for removing U.S. troops from Iraq, and underscored his commitment to consult with the Iraqi government as the process moves forward.

On Sunday, Obama said the peaceful elections in Iraq were “good news” for U.S. troops and their families, and agreed with the suggestion that a substantial number of those troops could return home within a year.

Obama had vowed during the presidential campaign to get combat troops out of Iraq within 16 months of taking office. He also wants to redirect some of those troops to Afghanistan to shut down a resurgent Taliban and al-Qaida.

During the conversation with South Korean President Lee Myung-bak, Obama relayed his commitment to the U.S.-South Korea alliance, Gibbs said.

Both presidents expressed their intention to broaden cooperation on global issues, including the financial crisis. They also discussed North Korea and agreed to work closely as allies and through the six-party initiative to achieve verifiable elimination of North Korea’s nuclear weapons and programs.

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Daschle withdraws as Obama’s healthcare nominee

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WASHINGTON (Reuters) - Former Senate Majority Leader Tom Daschle withdrew his nomination as President Barack Obama’s health secretary on Tuesday, saying he did not want to be a distraction after tax errors forced him to pay $140,000 in back taxes.

“This morning, Tom Daschle asked me to withdraw his nomination for secretary of health and human services,” Obama said in a statement. “I accept his decision with sadness and regret.”

Daschle also will not be taking the White House job he was slated to hold concurrently to spearhead a major reform of the costly U.S. healthcare system.

Daschle said in a statement he was withdrawing because he did not want to be a distraction.

“This work will require a leader who can operate with the full faith of Congress and the American people, and without distraction,” Daschle said in a statement released by the White House.

“Right now, I am not that leader and will not be a distraction,” he said.

(Reporting by David Alexander and Jeff Mason; Editing by David Wiessler.)

uk.reuters.com

First Daughters Malia, Sasha adjusting to Washington life just fine

Posted by Irati on February 2, 2009 under News | Be the First to Comment

WASHINGTON - Barack Obama is still adjusting to being president, but his daughters have embraced their new palace of perks as home sweet home, he said Sunday.

First daughters Sasha, 7, and Malia, 10. have made new pals in the first two weeks at their exclusive private school and invited some over to the White House for Super Bowl Sunday, he said.

“They’ve got some friends from school over today,” Obama told NBC’s Matt Lauer in a pregame interview in the Map Room. “People think I’m cool (but) nobody’s cooler than my two girls.”

The First Dad said his daughters have accepted their new digs “with happiness and steadiness,” whereas he is still absorbing the reality of being the leader of the free world.

Obama proudly boasted that they’ve already joined clubs at the Sidwell Friends School and Sasha “said she wanted to join a basketball team.”

“What more could I want?” he said with a grin.

Obama said he’s been seeing more of his family since moving into the White House two weeks ago, because he works out of “this nice home office.”

That would be the oval-shaped one.

But already Obama’s celebrity has slipped by one yardstick. He was cut out of the cover photo of the current US Weekly, which shows First Lady Michelle with the kids.

BY JAMES GORDON MEEK
DAILY NEWS WASHINGTON BUREAU

www.nydailynews.com

Obama to Require Banks Receiving Aid to Boost Lending (Update1)

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President Barack Obama will require banks to boost lending to consumers and companies in return for taxpayer aid from the $700 billion bailout fund, in a departure from Bush administration policy, a key lawmaker said.

“You’re going to see the Obama administration,” learning lessons from the first phase of the program, “push for much more lending,” House Financial Services Committee Chairman Barney Frank, who helped write the financial-rescue law, said yesterday on ABC television’s This Week program. “There are going to be some real rules in there.”

Obama will include the restriction in a bank-rescue strategy he is expected to announce in coming weeks, responding to congressional criticism that firms receiving funds from the first $350 billion installment failed to pass on the aid. Obama last week blasted Wall Street executives for paying bonuses, and reports showed some aid helped recipients to finance mergers and acquisitions that may lead to job cuts.

The administration and top Democratic lawmakers are seeking to differentiate the next stage of the financial bailout in order to insulate against popular opposition to a Wall Street rescue. Lawmakers are questioning the effectiveness of the Troubled Asset Relief Program they enacted in October, saying the Bush team’s decisions on deploying the first $350 billion did little to stabilize the economy.

Announcement Coming

While the Treasury may not announce its TARP overhaul until next week, the administration is likely to unveil in coming days a new, stricter set of rules reining in executive pay for the biggest recipients of taxpayer funds, an administration official said. The requirements, which may also restrict dividends, would apply to companies that get exceptional government aid.

Obama said today that the U.S. is suffering from a “massive hangover” from years of risk-taking and that some banks remain “very vulnerable.” In an interview on NBC’s Today show, he said it’s likely some banks haven’t fully disclosed their losses.

“They’re going to have to write down those losses, and some banks won’t make it,” he said. Referring to the administration’s plan for the financial industry, he said “I do have confidence we’re going to get it right but it’s not going to be overnight.”

Geithner Meetings

Treasury Secretary Timothy Geithner will meet today with Federal Reserve Chairman Ben S. Bernanke, Federal Deposit Insurance Corp. Chairwoman Sheila Bair and Comptroller of the Currency John Dugan to continue discussions on regulatory changes. Frank will also meet with Bernanke.

Among other gatherings, Geithner is expected to attend a Democratic congressional retreat this week, while Citigroup’s incoming chairman, Richard Parsons, met with Treasury officials Jan. 30.

“We’ve got to loosen up the credit markets,” Senator James DeMint, a South Carolina Republican, said yesterday on ABC’s This Week. “The first round of TARP did not support lending, which was its whole point.”

Under former Secretary Henry Paulson, the Treasury allocated about half of the $700 billion program to inject capital into banks, help automakers, and guarantee assets for Citigroup Inc. and Bank of America Corp. In its rescue efforts so far, the Treasury has taken ownership stakes in more than 300 banks as a condition of providing aid.

TARP Overhaul

“It is a mistake to assume that the Obama administration hasn’t learned from the mistakes of the Bush administration,” Frank, a Massachusetts Democrat, said yesterday. “I believe they’re going to do it very differently.”

The U.S. House of Representatives last month approved legislation written by Frank that sets conditions for the release of the remaining $350 billion in funds.

The bill, which Frank acknowledged wouldn’t immediately be taken up in the Senate, is meant to serve as a guide for the Obama administration for how lawmakers would like to see the money spent. It would require the Treasury to set up a foreclosure-relief program and direct banks to report how they are using the funds.

During his confirmation hearing last month, Geithner told the Senate Finance Committee that he would expect banks to step up their lending activities in exchange for receiving government funding, particularly if the banks were in good shape to start.

Condition for Help

“As a condition of federal assistance, healthy banks without major capital shortfalls will increase lending above baseline levels,” Geithner said.

The president in his weekly radio address on Jan. 31 said the new strategy will “help lower mortgage costs and extend loans to small businesses so they can create jobs.”

One part of that strategy will be addressing the toxic assets that are clogging lenders’ balance sheets and preventing them from expanding credit, people familiar with the matter said last week. Likely approaches include a government-run bad bank to buy and hold some of the securities, and insurance of other assets that remain on banks’ books.

Officials and regulators are grappling with how to value the investments in a way that shores up the banking system while not exposing the taxpayer to potentially trillions of dollars of losses.

Buying illiquid assets amounts to swapping taxpayers’ “cash for trash,” Nobel laureate Joseph Stiglitz said in a Jan. 31 panel discussion at the World Economic Forum in Davos, Switzerland. “You shouldn’t chase good money after bad.”

Stiglitz Warning

Stiglitz, a professor at Columbia University in New York and a former adviser to President Bill Clinton, said the plan would leave taxpayers paying for years of imprudent lending by banks.

The same challenge of how to value the assets has been a sticking point ever since Paulson and Bernanke went to Capitol Hill to seek the original bailout legislation last year.

At the time, Bernanke said the government would need to pay above “fire-sale prices.” Paulson later ditched the plan, deciding that buying assets was too complicated and expensive, and switched the focus to capital injections in the hope that stronger banks could unwind their balance sheets on their own. That hasn’t happened, so the idea of purchasing troubled assets is under consideration again, posing the same set of issues.

“If you pay too much, the bank that’s selling the assets may inappropriately benefit,” Michael Bleier, a partner at law firm Reed Smith in Pittsburgh and a former Fed lawyer, said in a telephone interview. “If you pay too little, you might crater the institution.”

Staff Strains

Also, it takes a lot of staff to manage the assets once the government takes them on, Bleier said. Real-estate investments come with upkeep, tax and even development costs. That adds to the complexity of the project.

Obama’s blueprint is also expected to include a program for alleviating foreclosures. One approach could resemble a plan unveiled last year by Federal Deposit Insurance Corp. Chairman Sheila Bair to have the government use TARP funds to guarantee modified mortgages.

Bair’s proposal, which she said could prevent 1.5 million foreclosures through 2009, would create a program that would pay servicers $1,000 to modify a troubled loan by reducing the interest rate, forgiving a portion of the principal or extending the repayment plan. The government would then absorb as much as 50 percent of any loss if the modified loan re-defaults.

By Alison Vekshin and Rebecca Christie

To contact the reporters on this story: Alison Vekshin in Washington at avekshin@bloomberg.net; Rebecca Christie in Washington at Rchristie4@bloomberg.net.

www.bloomberg.com

Hard to find any early criticism of Obama

Posted by Irati on under Articles | Be the First to Comment

The Unrepentant Conservative

Only 13 full days into his presidency, the anointed one has already issued the GOP an ultimatum. President Barack Obama told Republican leaders they need to quit listening to conservative talk show host Rush Limbaugh in order to get along with Democrats and his entire administration.

He invited these Republicans to the White House to discuss (attempt to persuade them to vote for) the nearly $1 trillion stimulus bill. His comments came after Limbaugh broadcast on his radio show, “I hope (Obama) fails.”

But Obama wasn’t the only one to cry over hurt feelings. The Democratic Congressional Campaign Committee posted an online petition against Limbaugh calling his comment an “outrageous Obama attack.” The Web site encourages people to “express outrage” about Limbaugh’s “attacks” on the President because, in liberal opinion, his comments were anti-American and politically incorrect.

What these Democrats, as well as Obama, have seemed to conveniently let slip their minds, however, are the last four (or more) years of the U.S. presidency. Numerous satirical books have been published with the single intent of making fun of President George W. Bush.

Michael Moore undoubtedly made millions distributing his skewed opinion in books and movies to Americans who clearly have too much money to spend. House Speaker Nancy Pelosi, who happens to be a Democrat, recently called Bush “a total failure.”

Especially in the last two years of Bush’s administration, it was commonplace for Americans to have this type of hate speech against the president splattered across the bumpers of their gas-guzzling, non-economically friendly sport utility vehicles, stuck in the grounds of their front yards and pinned to the shirts on their backs.

Were any of these actions petitioned? Were any of them even discouraged? Of course not. It was politically correct and certainly America-approved to express outraged attacks against Bush. Sadly, it was often even applauded.

So why is it different with Obama? How is it acceptable to bash the president on Jan. 19, but not on Jan. 20?

I wholeheartedly believe Limbaugh does not truly want Obama to fail. Nor do I, nor do most people who did not vote for “change” last November. What is generated from the Oval Office and the chambers of Congress inevitably will affect everyone regardless of party affiliation.

But, concurring with Limbaugh, it will be beneficial to all Americans if Obama does fail early on. He has become a god, a savior - but he is human. There is not a single presidential administration that has not had serious flaws and mistakes, and Obama is certainly not exempt. But I’m afraid the rest of the country believes that he is.

Because he is believed to be unsusceptible to failure, he has been put on a higher podium than his predecessors.

He has gained an enormous amount of respect that has quickly created a prohibition of opinion and free speech regarding him. If a sour word is said about Obama, it becomes racism and hate speech.

But let’s be fair, because we are a fair country. If we can hate speech one, we can hate speech another. Wipe the tears, Obama, and straighten that backbone. There is more where that came from.

Jennifer Chapman

Jennifer Chapman can be contacted at chapman92@marshall.edu.

media.www.marshallparthenon.com

Frank Says Obama to Force Banks in TARP to Lend More (Update1)

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Feb. 1 (Bloomberg) — House Financial Services Committee Chairman Barney Frank said President Barack Obama will require banks receiving government aid to lend more to businesses and consumers, saying the Bush administration “made a mistake” by not setting stricter rules for institutions getting funds from the $700 billion financial-rescue package.

“I think you’re going to see the Obama administration, having learned from that, push for much more lending,” Frank said today on ABC’s This Week. “There are going to be some real rules in there.”

Frank and other Democrats have faulted the Bush administration for not setting restrictions on banks that got capital injections from the first $350 billion installment of funds Congress released in October. Congress last month released the remaining funds to the Obama administration, which is crafting its own bank-rescue blueprint.

“It is a mistake to assume that the Obama administration hasn’t learned from the mistakes of the Bush administration,” Frank of Massachusetts said. “I believe they’re going to do it very differently.”

Lawmakers, upset that the bank rescue plan shows few signs of lifting the economy, have been pressing the Obama administration to come up with a plan for overhauling the effort.

Working on Plan

The president in his weekly radio address yesterday said his administration is working on a plan to unlock credit markets and lower mortgage rates.

“Soon my Treasury secretary, Timothy Geithner, will announce a new strategy for reviving our financial system that gets credit flowing to businesses and families,” Obama said. He didn’t provide specifics.

“We’ll help lower mortgage costs and extend loans to small businesses so they can create jobs,” Obama said. “We’ll ensure that CEOs are not draining funds that should be advancing our recovery.”

Geithner said last week the department is considering a “range of options” with the goal of preserving the private banking system.

Under Geithner’s predecessor, Henry Paulson, the Treasury allocated about half of the $700 billion program to inject capital into banks, help automakers, and guarantee assets for Citigroup Inc. and Bank of America Corp.

Ownership Stakes

In its rescue efforts so far, the Treasury has taken ownership stakes in more than 300 banks as a condition of receiving aid. The government usually receives preferred shares and warrants, which can be converted into common stock and cashed out at the government’s request.

The Treasury, under the TARP, has not sought voting rights or control over day-to-day business.

Frank said on the ABC program that inadequate government oversight allowed risky behavior that caused the financial crisis.

“The complete absence of regulation in the financial area has, I think, been a disaster,” Frank said.

Companies outside the banking system were extending themselves “into instruments which they couldn’t back up,” Frank said. “It was even within the banking system, letting people go with things that were off the balance sheet.”

Frank said the government has “under-taxed some of the financial manipulation, and I would be for a package that would shift that.”

Frank said he voted to raise the tax on so-called carried- interest profits that hedge-fund executives typically earn.

By Alison Vekshin

To contact the reporter on this story: Alison Vekshin in Washington at avekshin@bloomberg.net.

www.bloomberg.com

Obama urges fast action on Senate stimulus bill

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WASHINGTON (Reuters) - President Barack Obama predicted a “difficult next few days” as the Democratic-controlled Senate on Monday debated an almost $900 billion stimulus package of federal spending and tax cuts amid Republican opposition.

Senate Majority Leader Harry Reid of Nevada said he hoped to push the measure through the chamber by Friday after considering a stack of amendments offered by Republicans as well as members of his own party.

But Republicans — who last week withheld support from a similar measure in the Democratic-controlled House of Representatives — appeared ready to fight to put more emphasis on tax cuts and less on new spending.

“We’re not trying to prevent a package from passing. We’re trying to reform it — reformulate it,” Senate Minority Leader Mitch McConnell told a Capitol Hill news conference.

McConnell, of Kentucky, said most members of his party believed the package can be trimmed and should be aimed initially at easing record home foreclosures, which have largely been blamed for the deepening recession.

At the White House, Obama told reporters, “There are still some differences between Democrats and Republicans … between the White House and some of the products that have been discussed.

“But what we can’t do is let various modest differences get in the way of the overall package moving forward swiftly,” he said.

Obama, who met on Capitol Hill last week with House and Senate Republicans, planned to confer at the White House later in the day with congressional Democratic leaders.

The Senate bill contains $342 billion in temporary tax breaks and more than $545 billion in spending to total about $887 billion.

Spending proposals include measures to upgrade education and health care, bolster energy programs, rebuild crumbling roads and bridges and provide job training.

At the White House, Obama said he expected a “difficult next few days” as the Senate wrangles over the bill.

“What we can’t do is let various modest differences get in the way of the overall package moving forward swiftly,” he said. “We can put America back to work.”

But McConnell said the package can be trimmed and should be aimed initially at easing record home foreclosures, which have largely been blamed for the deepening recession.

Republicans suggested it should include a provision that would drive mortgage rates as low as 4 percent, arguing that this could both entice buyers into the moribund housing market and lower borrowing cost for existing homeowners.

TRADE WAR THREATS

McConnell denounced proposed “buy American” restrictions that would require iron, steel and manufactured goods used in infrastructure projects — like building roads and bridges — to be produced in the United States.

“I don’t think we ought to use a measure that is supposed to be ‘timely, temporary and targeted’ to set off trade wars,” he said.

Many Republicans and some Democrats have complained that some provisions in the bill, like $50 million to promote the arts, would not stimulate the economy and are little more than a liberal wish list.

Some of these items, such as $75 million for smoking prevention programs, have been dropped. White House press secretary Robert Gibbs said the remaining items that have drawn criticism amount to less than 1 percent of the entire package.

While Obama is open to some changes, “he’s satisfied that we have the basis of a proposal that will save or create 3 million to 4 million jobs and that the American people can be confident about,” Gibbs said.

In opening Senate debate, Democratic Senator Daniel Inouye of Hawaii, chairman of the Appropriations Committee, said, “We must act boldly or we will face dire consequences.”

Senator Thad Cochran of Mississippi, the panel’s ranking Republican, agreed on the need for speed — but with caveats.

“Congress should take quick but sharply focused action,” he said. “We should not, however, rush headlong into fiscal commitments that haunt us for years to come.”

By Thomas Ferraro and Susan Cornwell

(Additional reporting by Matt Spetalnick and Donna Smith; Editing by Vicki Allen)

uk.reuters.com

Bonus boneheads

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Wall Street bankers continue to reward themselves for a job poorly done

Even as their firms took in billions of taxpayer bailout dollars last year, Wall Street financial executives continued to pocket and ladle out big bonuses as if blissfully unaware that the nation’s economy was contracting in a painful recession that’s already destroyed thousands of jobs and resulted in myriad home foreclosures.

According to a report by New York State Controller Thomas P. DiNapoli, financial companies paid out at least $18.4 billion in bonuses to employees in 2008, not counting stock options that are usually part of the package to executives. The rewards were down considerably from the year before but still constituted the sixth largest on record.

The report prompted a strong rebuke from President Barack Obama, who denounced the payouts as a shameful display that counters his inaugural message stressing sacrifice and personal responsibility for all Americans. The president said it was unacceptable for those taking taxpayer dollars to keep their firms afloat to then generously reward themselves.

“The American people understand that we have got a big hole we have got to dig ourselves out of,” said the president, “but they don’t like the idea that people are digging a bigger hole as they are being asked to fill it up.”

As Obama observed, there is a time for profits and bonuses, but not in the midst of a financial crisis.

Other officials were quick to ratchet up pressure on the bankers to back off big bonuses. Senate Banking Committee chair Christopher J. Dodd, D-Conn, threatened to haul offending executives before the committee for grilling.

Vice President Joe Biden called the bonuses “the same old thing that got us here, greed. They’re thinking, take care of me.”

New York Attorney General Andrew Cuomo has already issued subpoenas to probe the issuance of more than $4 billion in bonuses by former Merrill Lynch executive John Thain shortly before the company was acquired by Bank of America, which has received $45 billion in equity investment from the government.

Thain himself has become a poster boy for flamboyant spending while the economy burns, including a million-dollar-plus re-do of his office that included a $35,000 commode. He has since promised to refund the expenditures to Bank of America.

Likewise, another bailout beneficiary, Citigroup, backed off plans to purchase a new $50 million corporate jet after receiving a tongue lashing from the president.

You’d think the financial execs would have learned something from the experience of their automaker counterparts in Detroit. They stirred up a storm of criticism from citizens and elected officials when they flew in private jets to panhandle for federal bailout money.

In the case of the bankers, what’s really galling is that they have already absorbed the first installment of Troubled Asset Relief Program funds without divulging how the money is being used. Instead of mandating hard and fast rules prohibiting assistance from being used inappropriately, the Bush administration and Congress failed to ensure both transparency and responsibility for the expenditure of the money.

In an indication that the industry still doesn’t get it, numerous financial analysts have stepped forward to defend the bonuses as necessary to keep top talent on board. Given the sorry performances by many executives, it would be better if they peddled their money-losing skills elsewhere.

Copyright 2009 Houston Chronicle

Feb. 1, 2009

www.chron.com

Obama picks Steelers in pregame interview

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WASHINGTON (AP) — President Barack Obama picked the Pittsburgh Steelers to win the Super Bowl while praising some of the biggest stars on the Arizona Cardinals.

It wasn’t exactly a good sign for the Steelers — Obama picked the losing New England Patriots last year.

“I’m still wondering how that guy made that catch,” he said of the crucial helmet-top reception by the New York Giants’ David Tyree. “It was one of the greatest plays in pro football history.”

Obama talked football during an interview with Matt Lauer on NBC’s pregame show Sunday.

Obama had already conceded earlier in the week that he was pulling for Pittsburgh. Steelers owner Dan Rooney, a longtime Republican, endorsed Obama’s presidential bid and campaigned for him.

“Not to mention the fact that Kurt Warner is close to my age. I love Kurt Warner’s story; I love Larry Fitzgerald — seems like a wonderful young man,” Obama said of the Arizona stars. “It’s a great story but Rooney didn’t just endorse me, that guy was out at going to steel plants campaigning for me. Franco Harris was out waving towels at my rallies.”

Asked if he had a Terrible Towel in the other room, Obama said: “I do, actually. I’m not going to be rubbing it in because we’ve got some Arizona congressmen here and I may need their vote on the recovery package.”

Obama didn’t predict a score, but said, “I think the Steelers are going to eek it out in the end.”

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Obama says most US troops in Iraq home within a year

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WASHINGTON, Feb 1 (Reuters) - President Barack Obama told Americans on Sunday a substantial number of the 140,000 U.S. troops in Iraq would be home within a year, saying Iraqis were now ready to take more responsibility for their own security.

Obama, who inherited two wars in Iraq and Afghanistan, pledged during his presidential campaign to withdraw all U.S. troops from Iraq within 16 months, at a rate of one or two brigades a month.

In an interview with NBC television, Obama praised the provincial elections held in Iraq at the weekend, the most peaceful polls since U.S.-led forces invaded in 2003 to topple Saddam Hussein.

Asked in the NBC interview whether a substantial number of troops would be home in time for next year’s Super Bowl, the National Football League’s championship game being played on Sunday, Obama replied: “Yes. We are going to roll out in a very formal fashion what our intentions are in Iraq as well as Afghanistan.”

The Obama administration has launched a comprehensive review of America’s strategy in Afghanistan, where NATO-led forces are struggling to cope with spiraling violence and a resurgent Taliban militancy.

The administration is considering almost doubling the U.S. force in Afghanistan from 36,000 to more than 60,000 within 18 months.

Obama, who held talks with the Joint Chiefs of Staff at the Pentagon last week, has said he wants a responsible and phased withdrawal of U.S. troops from Iraq. The United States signed a a military deal with Iraq last year that set a 2011 deadline for U.S. forces to quit the country.

“In conversations I have had with the joint chiefs, with commanders on the ground, I think we have a sense, now that the Iraqis just had a very significant election with no significant violence, we are in a position to put more responsibility on the Iraqis,” Obama said in the interview.

He also said one of the more sobering moments of his young presidency was having to sign letters to send to families of slain soldiers.

Some 644 U.S. soldiers have been killed in Afghanistan and 4,236 in Iraq. (Additional reporting by Andrew Sullivan; editing by Chris Wilson)

By Ross Colvin

www.reuters.com

Obama’s Kenyan half-brother detained over drugs

Posted by Irati on February 1, 2009 under News | Be the First to Comment

NAIROBI (Reuters) - A Kenyan half brother of President Barack Obama said on Sunday he was briefly arrested at his home in a slum on suspicion of drugs’ possession.

“I think it was a misunderstanding. I do not do drugs,” George Hussein Obama, 27, told Reuters from Nairobi’s Huruma slum, where he was picked up for a few hours on Saturday.

“They released me with no charge.”

Local media quoted police saying Obama, who works as a mechanic, had been found with two rolls of marijuana.

Kenya’s leading newspaper, the Nation, said he would be charged in court on Monday.

But Obama said that was untrue, and police officials refused to comment.

“I don’t know what you are talking about,” area police chief Jasper Ombati told Reuters, before hanging up the phone.

George Obama hardly knows his brother, the first black president of the United States, who is hero-worshipped in Kenya due to his ancestral roots.

During the U.S. election campaign, some right-wing U.S. commentators said the lowly circumstances of George Obama showed Barack Obama’s double standards. But George Obama said at the time he was happy with his life and his case had been exaggerated for political ends.

In his memoirs, “Dreams From My Father,” Barack Obama recalls meeting George Obama briefly on a visit to Kenya when the latter was a boy at a school in Nairobi.

“I am very tired of all this,” George Obama said on Sunday, of the media fuss over his family links.

By Andrew Cawthorne
(Additional reporting by Wangui Kanina; Editing by Dominic Evans)
www.reuters.com

Fair pay act may not close gap soon

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The first bill Barack Obama signed as president last week was the Lilly Ledbetter Fair Pay Act ensuring equal pay for equal work for women. As important as that bill was, economists don’t expect it to close the pay gap between women and men anytime soon.

As of the end of 2007, women in America were paid about 78% of what men were paid. Discrimination plays a part in that difference, but many economists say the gap persists mostly because of the varying kinds of work men and women do.

Despite huge strides in law and medicine, where women make up half or more of new entrants, men on average still get most of the higher-paying jobs in America, including union-represented factory work and high-paying construction jobs.

For millions of women, work remains a part-time or temporary second paycheck for their family, rather than a full-time career.

Indeed, economists say the pay gap is shrinking in part because men’s wages are falling. Those male wages have declined since the 1970s as factory work disappeared.

John Gallagher
www.freep.com

Obama shares spotlight with Palin at Alfalfa Dinner

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WASHINGTON - President Barack Obama shared Washington’s high-society spotlight on Saturday night with an unlikely co-star — Alaska Governor Sarah Palin.

Wearing a black satin evening gown, Palin was spotted by journalists making her way into the ballroom at the Capitol Hilton for the Alfalfa Dinner, an annual closed-door roast of the city’s political and business elite.

Following in the footsteps of White House predecessors, Obama served as headline speaker at the light-hearted black-tie affair, which in accordance with a 96-year tradition bars reporters.

So it was not known whether the president had any choice words from the podium for Palin, who as Republican vice presidential nominee in the 2008 election rarely missed a chance to lash into Obama.

But, according to a few of Obama’s joke excerpts released by the White House, he had a few zingers for his hard-driving chief of state, Rahm Emanuel, who has a reputation for sometimes harsh language.

“It was actually Rahm’s idea to do the swearing-in ceremony again,” he said. “Of course, for Rahm, every day is a swearing-in ceremony.”

“Rahm Emanuel is a real sweetheart,” Obama added. “Every week the guy takes a little time away to give back to the community. Just last week he was at a local school, teaching profanity to poor children.”

Of his battle to guard part of his pre-White House lifestyle after his Jan. 20 inauguration, he said, “In just the first few weeks, I’ve had to engage in some of the toughest diplomacy of my life. And that was just to keep my Blackberry.”

And Obama, the first black U.S. president, also poked fun at the Alfalfa Club’s founding in 1913 by a group of Southern gentlemen.

“Many you are aware that this dinner began almost one hundred years ago as a way to celebrate the birthday of General Robert E. Lee. If he were here with us tonight, the general would be 202 years old. And very confused,” Obama said.

Photo credit: Reuters/Tami Chappell (Palin at a campaign rally for Senator Saxby Chambliss)

Posted by: Matt Spetalnick
January 31st, 2009

blogs.reuters.com

Obama brings a new style to White House

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It has been nearly two weeks and as Mr Obama promised, change has indeed come to Washington. (AFP: Saul Loeb)

Americans have been getting used to the sight of a new president in the Oval Office.

The euphoria of Barack Obama’s inauguration has given way to much less exciting business of governing. Mr Obama has not only brought new policies to the White House but also a very different style.

It has been nearly two weeks and as Mr Obama promised, change has indeed come to Washington.

Not the big ticket policy shifts the Democrat had been pledging; fixing the economy, ending the war in Iraq and closing Guantanamo Bay which will take some time.

No, the change has been much more symbolic and cosmetic. Starting in the Oval Office.

Mr Obama has created something of a sensation for daring to take his suit jacket off as he goes about the business of ruling the free world.

Under his predecessor’s reign a coat and tie was mandatory for anyone wanting to enter the president’s inner sanctum.

One of Mr Obama’s advisers says there a logical explanation for this perceived drop in sartorial standards.

The new President apparently hates the cold and he has turned the Oval Office heating up full blast. “He’s from Hawaii”, exclaimed the adviser, “He likes it warm. You could grow orchids in there.”

There has also been a warming of relations between the White House and Congress.

Former president George Bush avoided Capitol Hill like the plague. If he wanted to speak to congressmen and senators, well they could damn well come to him.

Last week Mr Obama surprised many political veterans by happily taking the short drive down Pennsylvania Avenue to personally put his case to congressional Republicans for the proposed economic stimulus package.

If the new President looked at home as he strolled the corridors of Congress, well, he did spend four years there as a senator.

There is also the sight of two young children roaming the corridors of the White House. The people of Washington have been following the lives of Sasha and Malia Obama just as they would a soap opera.

The girl’s have added to the human touch of the new President. He may busy fighting recessions and wars but Mr Obama and wife Michelle dropped in at their daughter’s school the other day for a parent-teacher conference.

And like all parents trying to adjust to Washington life, Mr Obama has been confronted by the peculiar rules that require local schools to shut once the slightest sprinkling of snow settles on the nation’s capital.

For somebody from snow-bound Chicago this has been a bit hard to bear.

“My children’s school was cancelled today because of what? Some ice?” said Mr Obama.

“As my children have pointed out, in Chicago school is never cancelled. In fact my seven-year-old pointed out that you go outside for recess, you wouldn’t even stay indoors!”

“So, it’s, I don’t know; we’re going to have to try to apply some flinty Chicago toughness to this town.

“I’m saying when it comes to the weather folks in Washington don’t seem to be able to handle things.”

This is one challenge that might just prove a bit too tough for the new chief resident.

By Washington correspondent Michael Rowland

www.abc.net.au

Daschle Delayed Revealing Tax Glitch

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Report Details Payments From Health Sector

Thomas A. Daschle waited nearly a month after being nominated to be secretary of health and human services before informing Barack Obama that he had not paid years of back taxes for the use of a car and driver provided by a wealthy New York investor.

President Barack Obama, right, said through his press secretary that he stands with his friend and confidant Thomas A. Daschle. (By Charles Dharapak — Associated Press)

Daschle, one of Obama’s earliest and most ardent campaign supporters, paid $140,000 to the U.S. Treasury on Jan. 2 and about two days later informed the White House and the Senate Finance Committee, according to an account provided by his spokeswoman and confirmed by the Obama administration.

Although Daschle had known since June 2008 that he needed to correct his tax returns, he never expected the amount to be such a “jaw-dropping” sum and “thought it was being taken care of” by his accountant, spokeswoman Jenny Backus said.

White House press secretary Robert Gibbs said last night that Obama stands behind his friend and confidant. “The president believes nobody’s perfect but that nobody’s hiding anything,” Gibbs said.

The disclosure of Daschle’s tax problems coincided with the release of the financial statement he submitted to the Office of Government Ethics, which details for the first time exactly how, without becoming a registered lobbyist, he made millions of dollars giving public speeches and private counsel to insurers, hospitals, realtors, farmers, energy firms and telecommunications companies with complex regulatory and legislative interests in Washington.

Daschle’s expertise and insights, gleaned over 26 years in Congress, earned him more than $5 million over the past two years, including $220,000 from the health-care industry, and perks such as a chauffeured Cadillac, according to the documents.

In mid-December, Obama’s transition team discovered that $15,000 of the $276,000 in charitable contributions claimed by Daschle and his wife over three years lacked proper receipts. But the former Senate majority leader did not mention the larger tax liability until after his accountant had filed amended returns for him.

The Senate Finance Committee has scheduled a private session tomorrow to discuss Daschle’s tax problems. Daschle, visiting an ailing relative, was unavailable for comment this weekend, and aides refused to release his tax returns.

Meanwhile, the disclosure of Daschle’s lucrative ties to private companies with Washington interests have begun to raise eyebrows among those who expected Obama to be wary of relying on wealthy insiders to stock his administration.

“Daschle is the quintessential Washington story. You leave a powerful position, and you leverage it to make a fortune,” said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington, a nonprofit government watchdog group. “He is not alone . . . [and] it would be hard for Obama to fill his administration without ever turning to someone like that. That said, these are the kind of Washington insiders that Obama campaigned against.”

The Obama team is “learning that it’s easier to campaign on that than govern under it,” Sloan added. The problem is that “it looks disingenuous.”

In his principal campaign speech on government ethics in June 2007, candidate Obama decried the “morally offensive conduct” of lobbyists and lawmakers who help large industries and special interests exercise “an effective veto on our progress.” He singled out the drug and insurance industries for particular scorn, saying that they had pushed for a new Medicare prescription drug benefit and that lawmakers and Bush appointees who made it happen were rewarded with “cushy lobbying jobs that pay millions.”

Americans, Obama said, “are hungry for a new kind of politics.”

In recent months, Daschle has advocated for changes to the U.S. health system that are unpopular with sizable portions of the industry, including some physicians, drugmakers and insurance companies. Daschle has nonetheless prospered from a stream of income from the health sector, including $220,000 in speaking fees in the past two years, according to the ethics filing.

He also has been a trustee of the Mayo Clinic in Rochester, Minn. For part of the $2 million he received from the law firm Alston & Bird over the past two years, Daschle also reported that he gave “policy advice” to United Health, a conglomerate that sells insurance, helps the government administer Medicaid, advises drug companies and physicians and dispenses prescriptions.

The 12 organizations or companies that paid Daschle speaking fees, ranging from $12,000 to $30,000, included the National Association of Boards of Pharmacy and America’s Health Insurance Plans, an influential trade group.

The Health Industry Distributors Association, a trade association representing medical product distributors, wrote to Daschle last week to express concerns about proposed Medicare changes and reminded him of the $14,000 speech he delivered at its conference last year.

“As you may recall from speaking to some of our members during HIDA’s 2008 Executive Conference in Miami, where you were the keynote speaker, a competitive bidding program will undermine access to quality care for millions of beneficiaries,” said the letter, which was posted on the group’s Web site.

In a letter sent to the HHS ethics office on Jan. 16, Daschle did not list any specific entities that would pose a conflict of interest; he pledged instead not to participate for the next year in particular matters in which “a former client of mine is a party or represents a party.”

When he left the Senate in early 2005, Daschle held a more modest portfolio, according to the financial disclosure report he filed with the Secretary of the Senate.

Four pages in length, the document listed financial holdings ranging from $255,000 to $775,000. All of his money was held in investment funds and a retirement account, the two largest being a Fidelity/First Union capital management fund and a Vanguard fund, each of which held between $50,000 and $100,000. He was paid $175,700 as Senate leader and did not have any specific stock holdings.

Daschle did not list his Washington home in the Foxhall neighborhood, which, according to records, he and his wife, Linda, purchased in 2003 for $1.9 million. It is now valued at $2.9 million.

It is impossible to determine Daschle’s current net worth with precision because his assets and income are reported in ranges. He also wrote that the value of some assets was “not readily ascertainable,” including profit-sharing arrangements with InterMedia Partners, owned by Leo J. Hindery Jr., a longtime donor to Democratic campaigns and causes, and stock options granted to him by the commercial real estate firm CB Richard Ellis and by ethanol research company Mascoma Corp.

Spokeswoman Backus said that Daschle did “extensive work for four years, raising funds” for InterMedia from investors. Daschle, a Senate Finance Committee veteran, “naively” thought the car service Hindery provided was “nothing more than a generous offer from a friend,” she said.

Daschle collected director’s fees from five companies and organizations, including the nonprofit Freedom Forum, which advocates free press and speech rights; the bioenergy company Prime BioSolutions; and the Mascoma ethanol research company. The international energy company BP Corp. alone paid him $250,000 in director’s fees.

He also received a $21,ooo advance for a book on resolving the health-care crisis.

Daschle listed two residences, each valued at $100,000 to $250,000 — one in Aberdeen, S.D., the other in Altus, Okla.

Several Democrats on Capitol Hill defended Daschle.

“He’s the gold standard for integrity in government,” said former Daschle aide Andrea LaRue, now a partner in the government relations firm NVG. “The fact that he’s done so much to fix the honest mistakes shouldn’t be held against a man who has had such a long and distinguished career.”

Daschle’s tax troubles stemmed partly from his three-year-old ties to InterMedia, the equity investing firm, run by cable industry veteran Hindery.

Hindery made millions of dollars in telecommunications deals involving AT&T, Global Crossing and other firms that were subject to intense scrutiny by the Federal Communications Commission and the Internal Revenue Service. His firm now owns “Soul Train,” the R&B television show founded by the legendary DJ Don Cornelius, and Thomas Nelson, which bills itself as the world’s largest publisher of Bibles. Hindery’s firm also owns the Gospel Music Channel, the first 24-hour station devoted solely to Christian music, and Cine Latino, a leading cable channel for Spanish-language movies.

Hindery and colleagues at his firm have donated at least $227,000 to Democrats since 2005, according to Federal Election Commission records. Daschle chairs the firm’s advisory board, which includes two other former senators — Bob Kerrey and Slade Gorton — as well as Cappy R. McGarr, a Dallas investor who served as Daschle’s political treasurer, and Bernard L. Schwartz, the former head of Loral and a major Democratic donor.

In a 2005 book, Hindery called the absence of an efficient health-care system for poor families “disgraceful.” He did not respond yesterday to an e-mailed request that he explain what Daschle did for the company in exchange for years of limousine service and a million-dollar annual fee. Alan J. Sokol, a senior partner in the firm, said that Daschle did “a lot of helpful work” for the firm but declined to say what it was.

Staff writer Paul Kane and staff researcher Magda Jean-Louis contributed to this report.

By Ceci Connolly, Joe Stephens and R. Jeffrey Smith
Washington Post Staff Writers

www.washingtonpost.com

A New Symbol of Elite Access: E-Mail to the Chief

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Left and right, Ozier Muhammad/The New York Times; center, Doug Mills/The New York Times

THE HAVES The few who can send e-mail to President Obama, whose cybercircle has been limited for security reasons, include, from left, David Axelrod, senior adviser; Rahm Emanuel, the White House chief of staff; and Robert Gibbs, the press secretary.

WASHINGTON — Anthony Lake served as one of Barack Obama’s principal counselors on foreign affairs during the campaign and exchanged e-mail messages with him regularly. But now that Mr. Obama is president, Mr. Lake no longer has his e-mail address.

“No,” he said when asked if he had it. “Did. Don’t.”

Neither does Nancy Pelosi, the speaker of the House, nor Steny H. Hoyer, the majority leader, but they do not use e-mail much anyway. Mitch McConnell, the Senate Republican leader, is a BlackBerry fiend, but he does not have Mr. Obama’s address. Nor do many members of the cabinet, including Defense Secretary Robert M. Gates.

Vice President Joseph R. Biden Jr. has it, along with his own new super-secret BlackBerry and e-mail address. So do Mr. Obama’s chief of staff, his top advisers and some of his oldest friends from Chicago.

Senator Richard J. Durbin, a fellow Illinois Democrat, probably has it but refuses to say. “We’re not going to discuss it,” said a spokesman, Joe Shoemaker. Asked why, he said, “That’s pretty obvious, isn’t it?”

It is now the ultimate status symbol in a town obsessed by status. Mr. Obama was spotted last week trying out his new BlackBerry — or actually a more sophisticated, encrypted variation — and aides say that he uses a computer in the study next to the Oval Office but that he has agreed to limit the number of people he would exchange e-mail with. In the process, he created a new measure for Washington to judge who really has the ear, or the thumb, of the president.

For decades, the capital scoured state dinner invitation lists and Camp David visitor logs for clues to who was in and who was out.

Former President Bill Clinton established a new class of insider with his Lincoln Bedroom sleepovers, although those usually came with an implicit price tag as he tried to raise campaign money. Former President George W. Bush provided fewer opportunities for the elite to demonstrate their eliteness by virtually abandoning state dinners, but there were invitations to his Texas ranch to clear brush, a dubious distinction, perhaps, during 100-degree Crawford summers.

Now there is President Obama’s e-mail, the first used by a commander in chief while in office. “This is the 21st-century version of the same special access that certain people are always granted to the president,” said Joel P. Johnson, a senior White House adviser under Mr. Clinton. “In F.D.R.’s White House, it was Harry Hopkins and Harold Ickes. There will be a similar select few in this White House.”

Those select few who have Mr. Obama’s e-mail address, say people informed about the matter, include Rahm Emanuel, the White House chief of staff; David Axelrod and Valerie Jarrett, both senior advisers; and Robert Gibbs, the press secretary. But cabinet members like the interior secretary, Ken Salazar, said they did not have it. Secretary of State Hillary Rodham Clinton is a frequent BlackBerry user, but a spokesman said he did not know whether she had the president’s address.

Mr. Gates does not use e-mail for work, said Geoff Morrell, the Pentagon press secretary, and besides, he sees the president often enough that he does not need it to communicate with him by e-mail. “If you are secretary of agriculture, interior or something like that, it may prove more useful,” Mr. Morrell said. “But face time is not an issue for him.”

Mr. Obama joked about the exclusive nature of his e-mail list at the annual Alfalfa Club dinner in Washington on Saturday night. “How exclusive?” the president asked. “Everyone look at the person sitting on your left. Now look at the person sitting on your right. None of you have my e-mail address.”

The exclusivity is not just a matter of safeguarding the president’s scarce time or even protecting him from spam. Mr. Obama presumably knows not to send his bank account information to those ubiquitous Nigerian businessmen who clog e-mail inboxes. But security personnel worry that the more available his address, the more vulnerable it may be to hacking pranksters or, worse, to cyber-attackers from, say, Russia or China.

After all, Gov. Sarah Palin of Alaska found her e-mail account broken into and her messages posted online last year when she was running for vice president. Imagine a president’s e-mail put on display for the whole world to see — or perhaps just for the head of a hostile foreign intelligence service.

To minimize the risk, the government technology gurus have made it impossible to forward e-mail messages from the president or to send him attachments, people informed about the precautions say. His address is likely to be changed regularly as well. And the president’s friends and staff members are being lectured about security.

So Mr. Obama’s e-mail pals are largely keeping mum. Phone calls and e-mail messages to more than 40 of his top aides, relatives, friends and political associates last week yielded few who openly acknowledged having the address.

“I’m unable to confirm it,” a publicist said when asked if Oprah Winfrey sends e-mail to the president.

“I have no answer,” a top White House official said when asked the same question, refusing to be named saying even just that.

And there are many who might be expected to have it who do not. Former Vice President Al Gore, an early e-mail aficionado, does not exchange messages with the president. “To date, I have not known them to e-mail each other,” said his spokeswoman, Kalee Kreider.

John D. Podesta ran Mr. Obama’s transition and exchanged e-mail with him virtually every day from the election to the inauguration. But he did not join the administration and does not have the new address. “Some things are secret,” Mr. Podesta said, although he added, “My guess is the list will grow.”

This is the first time the issue has arisen, because Mr. Clinton never became interested in e-mail while he was president and Mr. Bush gave it up in the Oval Office on the advice of lawyers, who consider e-mail subject to the Presidential Records Act. (After eight years off the grid, Mr. Bush signed back on after leaving office last month, according to his former aide, Karen Hughes, who received a message from him the other day.)

Past presidents have found other ways of keeping in touch with the outside world.

Mr. Clinton and the first President Bush had a dedicated fax line, although the secret number sometimes leaked out. At least once during Mr. Clinton’s first term, a lobbying organization got hold of it and flooded the Oval Office with unwelcome propaganda, forcing the White House to change the number.

Mr. Clinton received 100 to 500 faxes a week, and they sometimes prompted him to rethink a speech or a policy approach. Aides came to dread them. “It was useful to him,” said Mr. Lake, a national security adviser to Mr. Clinton. “It was a pain to us because he would send them to us in indecipherable handwriting asking, ‘What do you think?’ ”

But Mr. Lake said Mr. Obama’s decision to keep using e-mail as president made sense, even though he himself was no longer a recipient. “You can become a captive of the bureaucracy, and this is one of the ways you avoid that,” Mr. Lake said.

Mr. Podesta said he strongly urged Mr. Obama to keep his BlackBerry. “He needs to stay connected to people,” Mr. Podesta said. “There is absolutely no reason not to do it.”

He dismissed the concerns of the security team: “They’d keep you in a lead container in the basement if you let them.”

The challenge for those privileged few with the address will be when to use it. What is the etiquette on sending e-mail to the president? Several friends and aides said they would hit the “reply” button but not the “new message” button — in other words, send messages only when messaged first.

“Rarely will I bother him for anything serious or nonserious,” said Alexi Giannoulias, the state treasurer of Illinois and a friend.

“I figure if he needs me or wants to talk to me on any social level, he can get me very, very quickly. His friends need to have a shift in mentality. He’s no longer Barack. He’s an institution.”

By PETER BAKER
Published: January 31, 2009

www.nytimes.com

Obama’s First Test: Stimulus Today, Change Tomorrow

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U.S. President Barack Obama speaks to reporters during his visit to the Capitol in Washington January 27, 2009.
Kevin Lamarque / Reuters

A favorite bumper sticker among fevered Bush haters held that the 43rd president was “all hat, no cattle.” Dictionaries of idiom define this as “when someone talks big, but cannot back it up.” We’ve known for a long time the size of Barack Obama’s head. Now we’re about to find out the size of his herd.

From his hard edged inaugural vow that “our time of standing pat, of protecting narrow interests and putting off unpleasant decisions, has surely passed,” to his frequent promise of smarter government, Obama has reflected a national consensus — which seems to exclude only the 535 sitting lawmakers — that the old way stinks. And beyond his rhetorical insistence on transparency and reform, Obama has invited Republicans to the party, first a cocktail party, next a Super Bowl party, as though he cares about what they think and where they disagree with him. (See pictures of Obama’s Inauguration.)

But we now are watching the “narrow interests” stomp around the emergency room and the unpleasant decisions are watching from the sidelines, waiting for their cue. It is easy to dismiss the unanimous Republican opposition to the House version of the stimulus bill as bitter, clueless obstructionism. But I can’t help but wonder at the gap between the aggressively sensible things Obama is saying and the passive way that he is acting. And you get a sense that a lot of people in the audience, the experts and economists as well as the worried working classes, are starting to wonder as well.

One deep tension was built in from the start of the stimulus debate, when Obama stressed both the need for speed, and the need for change. There is trauma surgery, and there is transplant surgery; one usually takes a lot longer than the other, and you’d be insane to try to do both together. So I wondered why he seemed to set himself up to fail, insisting that lawmakers do something very big, very hard, very fast, and in a whole new way.

Many people are now remembering that in Washington, bigger is hardly ever better. We’re glad that Treasury Secretary Henry Paulson’s original $700 billion bank bailout was split in two, so that having apparently squandered the first $350 billion, we have a chance of getting it right the second time.

Maybe that should be the model now. Within a near-trillion dollar stimulus bill there is probably enough that lawmakers agree on to get the kind of bipartisan vote Obama once aimed for: shoring up collapsing infrastructure, extending unemployment benefits, targeted tax cuts, and relief — with strings attached — to state and local governments and embattled homeowners. Then take a deep breath and let’s have the debate he promised, the rigorous test of Do We Need This and Can We Afford It, for all the other programs currently marinating in the bill, whether the honeybee subsidy or the Pell grants or the medical research or any of the proposed investments meant to spur longterm recovery and growth.

This isn’t just the first test, it’s the biggest. Trillion dollar legislation doesn’t come along every day, and the hard choices are not just what we spend money on but how, at what speed, towards which priorities. Is getting a bad bill quickly really worth it? Is taking more time to get it right really so risky?

I would not put it past this president and his team to have calculated that this engorged House bill was precisely what the system would yield; that the Republicans would oppose it out of both principle and politics; that there would come a moment, once all the Old Bulls had had their say, for the New President to ride in to the rescue, and actually fulfill his promise of Change We Can Believe In by turning this into a Bill We Can Actually Live With. Maybe he is building to a denouement, when a president who promised to make hard decisions takes a sprawling bill that tries to do so many things at once and performs some highly public sacrifices of some Democratic sacred cows. And by so doing, shows who’s really in charge of leading America out of these dark times.

If that’s the way this goes, he will have earned a hat as big as Texas. But if he keeps saying the right things while Washington keeps doing the wrong things, he will be worse than a passive leader: he will be the one who, with all the energies and hope he unleashed, brought the Democrats back to power, broke the legislative log jam, and drowned us all.

By Nancy Gibbs
www.time.com

Obama to Host Democrats, Republicans at White House Super Bowl Party

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President Obama is set to host a group of Democratic and Republican lawmakers at a Super Bowl party Sunday at the White House.

It’s an invitation few would turn down: Watching the Super Bowl at the White House with President Barack Obama playing host.

Obama is inviting a group of lawmakers to join him for tomorrow’s NFL championship game between the Pittsburgh Steelers and the Arizona Cardinals.

With no Chicago team for Obama to cheer, the president says he’s rooting for Pittsburgh, but that he also wishes Arizona the best.

Five of the 15 lawmakers invited to join Obama are from Pennsylvania, and two are from Arizona. There are four senators and 11 representatives. The group includes 11 Democrats and four Republicans.

The White House says the gathering is another step in the president’s continuing effort to get to know lawmakers better in hopes of reducing the partisan rancor as they work together on the people’s business.

(The invited lawmakers are: Sens. Bob Casey, D-Pa.; Dick Durbin, D-Ill.; Amy Klobuchar, D-Minn.; and Arlen Specter, R-Pa.; and Reps. Elijah Cummings, D-Md.; Artur Davis, D-Ala.; Rosa DeLauro, D-Conn.; Charlie Dent, R-Pa.; Mike Doyle, D-Pa.; Trent Franks, R-Ariz.; Raul Grijalva, D-Ariz.; Paul Hodes, D-N.H.; Patrick Murphy, D-Pa.; Fred Upton, R-Mich.; and Del. Eleanor Holmes Norton, D-D.C.)

Saturday, January 31, 2009
www.foxnews.com

Gregg’s Appointment to Commerce on Track

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Republican Sen. Judd Gregg is the leading candidate to become the next Commerce Secretary, a move that could happen in the next day or two, White House officials said on Saturday.

Gregg’s selection and exit from the Senate would clear the way for the New Hampshire governor, John Lynch (D), to appoint a Democrat as his replacement - giving Pres. Barack Obama the 60-vote majority he needs for a filibuster-proof majority. But Lynch, a moderate, could appoint a Republican instead, filling the seat with a caretaker senator until the next election, in 2010.

Gregg acknowledged on Friday that he was under consideration for the post. Administration officials took it a step further, saying he is atop the list to fill a job that has sat empty since New Mexico Gov. Bill Richardson (D) withdrew his nomination because of an investigation involving government contracts.

For Obama, picking Gregg would bolster his argument that he is truly building a bi-partisan Cabinet. Gregg is a fiscal conservative, a longtime supporter of Sen. John McCain and a Republican Party stalwart, though his state has grown increasingly moderate in recent years. Two other Republicans - former Rep. Ray LaHood, the Transportation Secretary, and Robert Gates, the holdover Defense Secretary from the Bush administration - are already in place.

But Gregg would also bring more than bragging rights: he could help Obama sell entitlement and budget reform to a wary Congress and to the business community, of which Gregg has been a strong advocate. Gregg, a three-term senator, is former chairman of the Senate Banking Committee, and helped devise the $700 billion bank bailout package that passed last year.

Among the potential Republican candidates Lynch might consider to replace Gregg: Bonnie Newman, the former president of the University of New Hampshire; Doug Scamman, the former New Hampshire House Speaker; former Gov. Walter R. Petersen, Jr.; and former Attorney General Tom Rath. On the Democratic side, it is likely that the two members of Congress, Paul Hodes and Carol Shea Porter, would at least be considered. New Hampshire’s other senator is Jeanne Shaheen, a Democrat who was elected in November.

By Anne E. Kornblut
Posted on Jan 31, 2009

voices.washingtonpost.com