Morning Bulletin – Friday, Feb. 6, 2009
A roundup of news, schedules, and key stories from CBS News Political Director Steve Chaggaris:
STIMULUS UPDATE: Late Thursday night as President Obama was wrapping up a visit to a House Democrats' retreat in Williamsburg, Va., Senate Majority Leader Harry Reid drew the line on the economic stimulus debate.
"But late Thursday he said he would give the bipartisan group [led by Sens. Ben Nelson, D-Neb., and Susan Collins, R-Maine] until Friday to reach a deal. If no deal is reached, he said he would call for procedural vote on Sunday aimed at moving to final vote."
President Obama, for his part, was sounding like the "fired up, ready to go" Candidate Obama during his remarks to House Democrats last night. Ramping up his aggressiveness in order to rally the troops to finish work on the first priority of his presidency, Mr. Obama reached into his campaign bag of tricks to bash Congressional Republicans.
"This is not a game. This is not a contest for who's in power and who's up and who's down. These are your constituents. These are families you know and you care about. I believe that it is important for us to set aside some of the gamesmanship in this town and get something done," Mr. Obama continued.
"[T]here's the argument, well, this is full of pet projects. When was the last time that we saw a bill of this magnitude move out with no earmarks in it? Not one. ... So then you get the argument, well, this is not a stimulus bill, this is a spending bill. What do you think a stimulus is? That's the whole point."
"This package is not going to be absolutely perfect, and you can nit and you can pick, and that's the game we all play here. We know how to play that game. What I'm saying is, now we can't afford to play that game. We've got to pull together. ... All of us are going to have to make some sacrifices. And we have to accommodate the interests of a range of people. And the House is going to have to work with the Senate. But let's think big right now. Let's not think small. Let's not think narrowly."
The Washington Post's Michael D. Shear writes, "Attempting to persuade a nervous nation and skeptical lawmakers to back his economic rescue plan, President Obama has morphed into the nation's fiscal salesman in chief, pitching his prescription for financial recovery everywhere he can. Obama may be hoping that his interpersonal skills can help blunt political and philosophical opposition to his plan, but so far he is having mixed results. ...
"Obama's personal lobbying and public relations efforts have not always succeeded. He spent hours behind closed doors with Republican House members, only to see them vote as a bloc against his stimulus plan. Public opinion polls suggest Americans remain largely unengaged by the stimulus plan and divided over whether it deserves passage. In Congress, many lawmakers say calls from their constituents are running wildly against spending so much money to stimulate the economy, despite the president's full-throated endorsements. It is an early reminder that there are limits to presidential power, even for a charismatic new chief executive who is immensely popular with the American people."
ON TODAY'S SCHEDULE: President Obama will introduce members of his Economic Advisory Board at 11:15am ET.
"Making good on a promise to name a diverse outside economic advisory panel, President Barack Obama Friday will appoint a slate of business, economic and labor leaders – from conservative economist Martin Feldstein to AFL-CIO secretary-treasurer Richard Trumka – to help guide him on the path out of recession," reports the Wall Street Journal's Jonathan Weisman.
"The ... Board, chaired by former Federal Reserve Chairman Paul Volcker, will be modeled after the existing Foreign Intelligence Advisory Board to bring in voices from outside government to help shape policy.
"Obama aides say the board will focus on short-term measures to stimulate the economy as well as longer-term efforts to restructure the regulatory apparatus overseeing financial markets. Austan Goolsbee, a University of Chicago economist and close campaign aide, will be its executive director.
Some of the panel's members have close Republican ties, such as Mr. Feldstein, a Reagan White House economist, and William H. Donaldson, a former chairman of the Securities and Exchange Commission appointed by President George W. Bush. Others have close political ties to the president, including Penny Pritzker, an heir to the Hyatt hotel fortune, and Robert Wolf, chairman of chief executive of UBS Group Americas.
The group also includes Roger W. Ferguson Jr., a former Federal Reserve vice chairman, not chief executive of TIAA-CREF, Silicon Valley venture capitalist John Doerr, and Jeffrey R. Immelt, chief executive of General Electric."
Later, at 3pm ET, Mr. Obama meets with the families of victims of 9/11 and the U.S.S. Cole bombing. The meeting comes "as his administration struggles to decide how to handle detainees at Guatanamo Bay, Cuba, several of those invited said," write Michael D. Shear, Peter Finn and Dan Eggen of the Washington Post.
"The previously undisclosed meeting at the White House tomorrow afternoon will give the new president a chance to explain his decision to close the controversial prison facility where the U.S. has placed many suspected terrorists since the Sept. 11, 2001, attacks. ...
"One 9/11 activist, who declined to be identified talking about the meeting, said 'fireworks' are likely at the gathering because it will include both relatives who oppose and those who support Obama's plan to close Guantanamo Bay. 'There's been some noise that some families don't like the idea and others do, so this is a chance to discuss that,' the activist said.
"Jim Riches, a retired New York firefighter whose son, Jimmy Riches, died in the 9-11 attacks, said in an interview Thursday that he wants to hear directly from President Obama what the government intends to do with the prisoners. 'I want to know, are they going to drop the charges? Are they going to try them in another court?' he said. 'I want to let them know that these men are dangerous.'"
"Administration officials have concluded that Russia pressed Kyrgyzstan, a former Soviet republic, to close the American base in that country, which they interpret as a shot across the bow. The base is crucial to the American-led fight in Afghanistan that Mr. Obama has identified as his central national security objective.
"Mr. Obama plans to deploy as many as 30,000 additional troops to Afghanistan over the next two years; shaky overland supply routes through Pakistan would make it difficult for the United States to adjust to the loss of the base, in Manas, Kyrgyzstan.
"It was Mr. Biden who warned publicly in October that Mr. Obama's mettle could be tested early in his administration by some kind of an international crisis. Now, a speech that Mr. Biden is scheduled to deliver Saturday before leaders and defense officials from Europe and Asia will be watched closely to determine what tack America's fledgling leadership will take regarding Russia." Mr. Biden's speech is scheduled for 6:20am ET Saturday.
Day two of CIA Director nominee Leon Panetta's confirmation hearing in the Senate Intelligence Committee begins at 10am ET.
ECONOMIC STIMULUS
Washington Post's Shalaigh Murray, William Branigin and Paul Kane, "Senate Moderates Negotiate Cuts to Economic Stimulus Bill": "A large group of Senate moderates huddled in a Capitol Hill conference room today in an effort to cut tens of billions of dollars from an economic stimulus bill that now tops $900 billion, as wrangling continued over a package that President Obama called vital to prevent the nation from falling into potentially irreversible decline.
"The centrist group has identified at least $80 billion in recommended cuts from the legislation, according to a draft given to The Washington Post, with a huge chunk of the recommended reductions coming in education funds."
Wall Street Journal's Greg Hitt, "Senate to Resume Stimulus Debate": "The bipartisan senators were working from the committee-passed legislation, which came with an initial price tag of $885 billion. In a series of closed-door meetings, the moderate group identified tens of billions of dollars in potential cuts. One summary outlined reductions totaling $87 billion, targeting education, food research, and sewer construction, among others. Aides said additional proposals under consideration could bring the total to just over $100 billion.
"One option under consideration was to redirect some of the savings into infrastructure investments, such as spending on highways and bridges, which are popular. Still undecided was what to do with the tax breaks and other initiatives added on the floor.
"The thrust of the Collins-Nelson group's plan would be to better focus the package on job creation. But in cutting spending, the plan would make tax cuts a larger share of the package's total value -- and thus move closer to the Republican position. The moderate group would trim spending but leave untouched the roughly $270 billion tax-relief measure crafted by the Senate Finance Committee."
Wall Street Journal's Gerald F. Seib, "Centrists Find Voice in Stimulus Debate": "Thanks to the debate over the economic-stimulus package, a hardy band of senators from both parties may have begun to fill up that hole in the political middle. Thursday night this band of centrists produced a plan to cut the stimulus bill's spending by perhaps $100 billion; their proposal is likely to be voted on by the full Senate Friday. Along the way, the quest for changes in the stimulus package just might have brought together a group of men and women who could form a durable centrist bloc to hold sway in the era of Obama."
NY Times' Neil A. Lewis, "Stimulus Plan Has $1 Billion to Hire More Local Police"
FINANCIAL BAILOUT
Wall Street Journal's Deborah Solomon, "Bailout Talks Turn to More Equity Stakes"
Bloomberg News' Rebecca Christie and Alison Vekshin, "Geithner's Bank Rescue May Emphasize Guarantees Over 'Bad Bank'": "U.S. Treasury Secretary Timothy Geithner's strategy to aid the nation's banks will likely emphasize guarantees of toxic assets over proposals to create a so-called aggregator bank that would remove them from balance sheets, according to people familiar with the plan. The government guarantees, which might be modeled on those already given to Citigroup Inc. and Bank of America Corp, may be coupled with the purchase of preferred shares in the banks that would be later convertible into common stock, some of the people said. The aggregator bank or 'bad bank,' has lost favor, in part because the potential costs involved, they added." http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a4kNe4UbH6k8
Wall Street Journal's Michael R. Crittenden and Deborah Solomon, "Watchdog Says U.S. Overpaid For Troubled Assets of Banks" http://online.wsj.com/article/SB123388173988054919.html
OBAMA'S CABINET
USA Today's Matt Kelley, "Tax snafus add up for Obama team": "The confirmation of another Cabinet member stalled Thursday because of unpaid taxes after USA TODAY disclosed that the husband of Labor secretary nominee Hilda Solis paid about $6,400 this week to settle numerous tax liens against his business dating to 1993.
4700882Wall Street Journal's Siobhan Gorman, "Panetta Hearing Focuses on Bush-Era CIA Challenges": "Leon Panetta, nominee to be director of the Central Intelligence Agency, said Thursday that he would 'turn the page to a new chapter' at an institution that, according to current and former officials, faces a host of internal challenges. Mr. Panetta's remarks came during a confirmation hearing before the Senate Intelligence Committee, a session focused largely on Bush-era issues such as interrogations of terrorism suspects.
"President Barack Obama is pushing what he calls a 'rebranding' of U.S. intelligence and moved quickly after his inauguration to close the CIA's secret prisons and revoke controversial interrogation techniques. Still, 'many problems' await Mr. Panetta, said the intelligence panel's chairman, Sen. Dianne Feinstein, prior to the hearing. Those include redirecting young agents who were siphoned off for the Iraq war and fixing a bureaucracy that often leaves people in the field waiting for direction, some intelligence officials said. Sen. Christopher S. Bond, the panel's top Republican, said during the hearing that CIA leaders have been reluctant to hold "employees accountable for poor performance or bad judgment."
James then asked the former presidential candidate how he thought President Obama was "doing so far": "I think President Obama is off to a rocky start. The theme 'Yes, we can' seems to have been replaced with 'Well, maybe we can't.'
I believe that with all the challenges America faces, the simple solutions and the hope that were sold by the Obama team are inadequate to the task ahead. The cabinet appointments have been subject to a disappointing vetting process. His forays into foreign affairs produced a very unfortunate comment that America has been 'dictating' to other nations. And rather than proposing and driving through Congress his own economic stimulus plan, President Obama ceded the construction to House Democrats. They in turn have come up with a pork-laden, ineffective piece of legislation which I think Americans are increasingly recognizing will not solve the economic challenges we face."
JUSTICE RUTH BADER GINSBURG
Associated Press' Mark Sherman, "Ginsburg's illness could lead to Obama appointment": "Word of Justice Ruth Bader Ginsburg's illness on Thursday, just two weeks after Obama's inauguration, set off an inevitable round of speculation about whether she will have to retire sooner than she would wish — and whom Obama might tap as her successor. Chances are, Obama's first appointment will be a woman — especially if it's to take the place of Ginsburg, the only woman on the court. And, like Ginsburg, she will be liberal leaning."
MINNESOTA SENATE RECOUNT
Minneapolis Star Tribune's Pat Doyle and Kevin Duchschere, "In Senate recount, suddenly geography is crucial": "Franken counters Coleman effort to add ballots from GOP areas by asking the court to add more rejected absentee ballots from DFL areas."
ALSO:
NY Times' Eric Schmitt and Mark Landler, "General Says His Envoy Job Was Rescinded": "Gen. Anthony C. Zinni, the former top American commander in the Middle East, said the Obama administration offered him the Baghdad job late last month, but withdrew the appointment without explanation, apparently in favor of a veteran diplomat, Christopher R. Hill.
"With General Zinni fuming in undiplomatic fashion about the way he was treated, the question of who should be the next ambassador to Iraq has turned into an embarrassing mess for the Obama administration as it struggles to recover from other stumbles over high-profile nominations. There has still been no formal announcement about the Iraq job. ...
"The White House and the State Department have refused to talk about discussions with General Zinni, 65, a four-star Marine general who retired in 2000 as head of the military's Central Command. All indications suggest that the ambassadorial post will go to Mr. Hill, who has been the senior American envoy in negotiations over North Korea, but who has no Middle East experience. ...
"General Zinni was a prominent critic of the Iraq war before the invasion, but he supported the temporary increase in troops in Iraq and opposed a rapid withdrawal there, putting him closer to Senator John McCain's position than to President Obama's. Early on, he also called for the defense secretary at the time, Donald H. Rumsfeld, to resign."
Associated Press' Deborah Baker, "Val Kilmer ponders run for NM governor in 2010": "'I'm just looking for ways to be contributive,' Kilmer told The Associated Press on Thursday. 'And if that ends up being where I can make a substantial contribution, then I'll run.'"
Washington Post's Anne E. Kornblut profiles White House Counsel Greg Craig, "For Obama, a Trusted Voice Who Knows the Terrain"
The Hill's Reid Wilson, "RNC shakeup as Steele asks for resignations": "Top staffers at the Republican National Committee were told to submit their resignations today, with some being told they will not get their jobs back in what insiders call a top-to-bottom review of the entire organization. State victory directors will be jobless after tomorrow, according to sources inside the RNC, while other staffers in the political and communications departments have been told they may be rehired."