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Morning Bulletin – Monday, Jan. 26, 2009

Two items on President Barack Obama's agenda today: the economy and climate change.

He'll meet with his economic team this morning and at 10:30am, he'll "call on the Environmental Protection Agency ... to consider allowing states including California to regulate automobile greenhouse-gas emissions," report the Wall Street Journal's Stephen Power and Laura Meckler.

"Mr. Obama's announcement is almost certain to spark a war between two key Democratic constituencies: environmentalists and state officials who want power to set greenhouse-gas rules, and auto makers and unions who say such rules would exacerbate the industry's woes following the worst year of U.S. vehicle sales in more than a decade."

A White House official points out to CBS News that Mr. Obama's directive asks "the EPA to reconsider the Bush Administration's denial of California's request for a waiver that would allow it to set emission standards for greenhouse gases from motor vehicles."

It "does not order that the waiver be granted; it requests that EPA undertake the legal process to reconsider the denial of the waiver, which will include an opportunity for interested parties to comment. A final decision by EPA on whether to reverse the Bush decision is anticipated to take several months."

The Wall Street Journal adds, "Mr. Obama also plans to direct the Department of Transportation to complete automobile fuel-economy standards by March so that they can take effect for the model year 2011.

"Mr. Bush's administration had pledged to take such a step before the end of his term but ultimately punted the issue to Mr. Obama. ... The directive on fuel-economy standards won't change federal policy, which already calls for tougher mileage standards. But it assures that those new standards will be in place for the 2011 model year."

Meantime, this week, the House takes up President Obama's proposed $825 billion economic stimulus package – a vote is expected on Wednesday.

Over the weekend, Congressional Republicans made it clear they were not going to roll over. "Some of the sharpest criticism came from Sen. John McCain (R-Ariz.), the party's challenger to Obama in the election and the recipient of aggressive outreach as part of the new president's efforts to forge an image of bipartisanship," writes the Los Angeles Times' Peter Wallsten.

"He "said he would not support the stimulus plan in its current form, asserting that it should have more tax cuts and less emphasis on projects, such as repairing the National Mall or extending broadband access to rural areas.

"'There's got to be some kind of litmus as to whether it will really stimulate the economy,' McCain said on 'Fox News Sunday,' adding later: 'There has to be major rewrites [of the legislation] if we want to stimulate the economy.'"

House Minority Leader John Boehner, R-Ohio, said Sunday on "Meet the Press, "Right now, given the concerns that we have over the size of this package and all of the spending in this package, we don't think it's going to work. And so, if it's the plan that I see today, put me down in the no column."

Politico's Josh Kraushaar points out that there are moderate Republicans that are looking ahead to 2010 – and convinced that opposing overspending is a politically savvy move.

"Moderate Republicans are resisting the cost of President Obama's $825 billion stimulus package, a signal that even Republicans with the most to lose by bucking the popular Democratic president remain unconvinced that there is widespread public support for the spending plan. ...

Rep. Mark Kirk (R-Ill.), a leading GOP moderate who co-chairs the Tuesday Group, a caucus of moderate Republicans, spelled out his concerns in a memo last week to his House Appropriations Committee colleagues, replete with an 11-point rebuttal of the proposed stimulus.

"In the memo, he argued that a similar level of job creation can be achieved for just $65 billion and that many of the items are wasteful and unrelated to economic stimulus. Another moderate, Rep. Peter King (R-N.Y.), also said that he opposed excessive spending in the stimulus, though a provision increasing Medicaid funding could win him over.

"'It's going to be a tough vote for me. There is too much spending in it. In principle, I'd say I'd vote against it,' said King. 'But if I vote for it, it will primarily be because of the Medicaid funding, which I've been a leader in the House fighting for.' The positions staked out by both Kirk and King are notable since both are considering Senate runs in 2010 in solidly Democratic states."

Treasury Secretary nominee Tim Geithner is expected to be confirmed by the full Senate today, however, the delay in getting him confirmed "is slowing the administration's ability to assemble a team to help tackle the worst financial crisis in decades," reports the Wall Street Journal's Deborah Solomon.

"Many of the top positions at Treasury require Senate confirmation. Once Mr. Geithner is confirmed, many of his staff are expected to work in advisory roles pending confirmation. Until then, much of the heavy lifting is being done by career staff. To help get through the transition, the Obama team has asked some of Mr. Paulson's staff to remain temporarily, including Neel Kashkari, who oversees the $700 billion Troubled Asset Relief Program."


Oprah for Senate? That's what Gov. Rod Blagojevich, D-Ill., said he considered when discussing replacements for Mr. Obama's Senate seat. On "Good Morning America" today, he said, "She seemed to be someone who would help Barack Obama in a significant way become president. She was obviously someone with a much broader bully pulpit than other senators. She probably wouldn't take it..."

Chicago Tribune, "Senate trial looms, Blagojevich unbowed"


Washington Post's Chris Cillizza and Paul Kane, "Franken Has the Lead, but Coleman Has His Day in Court": "The longest-running Senate campaign in the nation heads into the home stretch this week. We think. Today in St. Paul, Minn., a three-judge panel will kick off a trial featuring Norm Coleman, the incumbent Republican senator who, after an initial election-night count showed him ahead by a few hundred votes, finished 225 votes behind Democrat Al Franken when a full hand recount concluded earlier this month.

"But the legal battle is just one piece of a multi-front campaign that continues three months after Minnesota residents cast 2.9 million votes. Each candidate continues to run a full-throttle public relations effort to make voters believe that he is the rightful victor."


The Capital Times' John Nichols, "Following New York Governor David Paterson's controversial selection of Kirsten Gillibrand to fill the U.S. Senate vacancy created by the resignation of Secretary of State Hillary Clinton, and with the impeachment trial of Illinois Governor Rod Blagojevich for abuses of office allegedly including the bartering off of the vacant Senate seat of President Barack Obama, Wisconsin Sen. Russ Feingold wants to require that Senate vacancies be filled by the voters rather than individual governors. Feingold, the chairman of the Senate Judiciary Subcommittee on the Constitution, plans to introduce an amendment to the U.S. Constitution to require special elections in the event of a Senate seat vacancy."

NY Daily News' Elizabeth Benjamin, "Hired PR gun doomed Caroline, insiders say": "Gov. Paterson's decision to go nuclear on Caroline Kennedy was a hatchet job run by a pricey out-of-state consultant who specializes in political scandals, disgruntled administration sources said.

"Judy Smith, a Washington-based PR guru and former Bush White House deputy press secretary, orchestrated the ill-conceived character attack on Kennedy, sources said Sunday. There was an internal agreement among Paterson staffers to refrain from attacking Kennedy. Then came the leaks from inside the governor's office that Kennedy's supposed tax, nanny and marital problems had tanked her bid for Hillary Clinton's Senate seat - taking many staffers by surprise."

NY Times' Sharon Otterman, "Gillibrand Meets With Clinton": "Two days before she will be sworn in as New York's junior senator, a smiling Kirsten E. Gillibrand said Sunday that she planned to 'hit the ground running.' 'It's thrilling,' said Ms. Gillibrand, the 42-year-old Congresswoman from the sprawling 20th Congressional district around Albany. 'You will see me everywhere in the state. You will see me wherever you want to see me.'

"Ms. Gillibrand spoke to reporters after finishing a congratulatory lunch at the Waldorf-Astoria in New York with the newly minted Secretary of State Hillary Rodham Clinton, Charles E. Schumer, the state's senior senator, and New York Governor David A. Paterson, who appointed Ms. Gillibrand on Friday to fill Ms. Clinton's vacated senate seat. Ms. Gillibrand said that the four discussed foreign policy and how to best stimulate the flagging economy, and Ms. Clinton had offered her some practical advice on how to be an effective senator."

2010 RACES

Politico's John Bresnahan, "Dems brace for fundraising slump": "It's early in the 2009-2010 cycle — President Obama's inauguration last week marked the unofficial start of the money chase — but some trends are already emerging: There is 'concern,' but not panic, among fundraising pros as the economic slowdown takes hold; small donors, like those who fueled Obama's White House run, are likely to be affected more than big donors; and Republicans will get hit worse, possibly far worse, than Democrats.

"A Democratic insider, speaking on the condition of anonymity, said direct-mail fundraising for Democratic congressional candidates started to 'sharply decline' in September and October as "donor fatigue" and the extent of the Wall Street collapse became apparent — but that the drop-off was masked by Obama's continued success in raising online funds."

NY Daily News' Kenneth Lovett, "Gov. [David] Paterson's [D-N.Y.] political future is on life support"


USA Today's Marisol Bello, "Renamed schools, streets mark early tributes to Obama"

Politico's David Mark, "Cartoonists draw blank on Obama"

NY Times' Jim Rutenberg and Adam Nagourney, "Melding Obama's Web to a YouTube Presidency"

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