On The Hill

Think Again: “History” Isn’t a Dirty Word

2009-11-21T11:11:00.004-05:00

By Eric Alterman

Last week, Mike Allen and Jim Vandehei at Politico reported that the White House planned on making deficit reduction a centerpiece of the next State of the Union address. Allen and Vandehei called the decision “practical” saying that “Obama has spent more money on new programs in nine months than Bill Clinton did in eight years, pushing the annual deficit to $1.4 trillion. This leaves little room for big spending initiatives.” This fact is taken completely out of the context of the recession. The title of the article refers to the White House's “spending binge.”

The deficits, tax cuts, and spending of the previous administration are ignored entirely.

It’s not exactly news that most members of MSM are almost purposely amnesiac. There is no greater insult to a reporter than to call his story “history.” And yet once upon a time, it was only yesterday that was old news. Nowadays, with the new neverending cable/talk-radio/blogosphere-driven news cycle, we are all supposed to have forgotten the past fifteen minutes. (There is actually a headline on the Drudge Report as I write this that the Associated Press went to the trouble of looking at the record and seeing whether any of the outrageous claims made in Sarah Palin’s memoir are true. The idea appears to be if it says so in a book, it’s wrong of a journalist to actually check the record. The (surprise, surprise) Fox News story contains no link to the AP story, further making the point that the record is really irrelevant to the story.)

So back to Obama’s “spending binge.” Even if the Politico editors are not interested in what may have happened in the past eight years to cause some of the deficits with which the Obama administration is forced to deal, we are. And here are just a couple of examples we found:

The Bush tax cuts: When the Bush tax cuts sunset at the end of 2010, the previous administration will have left the government holding the bag for well over $2 trillion in lost revenue. The extraordinary debt and deficits accrued during Bush’s tenure have been compounded by the implosion of the financial system. In addition, the estimated eventual costs of the costly, unnecessary, and counterproductive Iraq war are now in the trillions to say nothing of the costs of more than six years of failure in Afghanistan. What have they done for America?

As David Cay Johnston, a former New York Times reporter, recently noted, based on data compiled by the nonpartisan Tax Policy Center, by the time the Bush tax cuts expire next year, people in the top one percentile of annual household incomes will have received 23.5 percent of all the savings in the cuts. The combined savings of the bottom three income brackets was less than that.

In 2004, Peter Orszag, the current director of the Office of Management and Budget, wrote extensively on the costs of the Bush tax cuts as a fellow at the Brookings Institution. He explained that the only way to make the tax cuts permanent and fill the budget gap would be to make enormous cuts in vital government services or to institute new regressive taxes.
Were the cuts paid for, the burden would fall on those in the lower income brackets in both spending cuts to services and increased taxes. Up to this point, the Bush tax cuts have not been paid for in either significant cuts in spending or tax increases—merely with increased debt. David Cay Johnston pointed out that the interest on that debt equals “a month worth of income taxes paid to the government by individuals.”

The Bush war: The opaque appropriations process for funding the Iraq war has generally allowed the Bush administration to shield itself from a great deal of scrutiny by the public on the total cost of the war. Congress approved “bridge funding” and emergency spending requests and so the full costs of the war were kept out of the budget. None of the dollar amounts for the funding requests have been included in the Pentagon’s annual operating budget.

So what does the Iraq war really cost? As early as 2006, Joseph Stiglitz and Linda Blimes estimated that the cost of the war could exceed $2 trillion, including health care for veterans and other expenses. The Congressional Budget Office, in 2008, called it a $1 trillion war, but a trillion strikes us as an overly modest estimation today.

Andrew Bacevich, a professor of international relations at Boston University and a former Army colonel, wrote in 2008, “Meanwhile, to fund the war, the Pentagon is burning through somewhere between $2 billion and $3 billion per week. Given that further changes in U.S. policy are unlikely between now and the time that the next administration can take office and get its bearings, the lavish expenditure of American lives and treasure is almost certain to continue indefinitely.”

Afganistan: The legacy of Bush’s runaway military spending and his tax cuts is doing more than just destroying the fiscal health of our government—it is also endangering our security. Look at Afghanistan. According to a recent report in The New York Times, “Some administration estimates suggest it could also cost up to $50 billion over five years to more than double the size of the Afghan army and police force, to a total of 400,000. That includes recruiting, training and equipment.”

David Broder, dean of the national press corps, has actually written that Obama’s “urgent necessity is to make a decision—whether or not it is right.” That is how far we’ve come. Never mind that six years of a failed strategy by the Bush administration, to say nothing of rushing into a catastrophic war, and busting the budget with a giveaway to the rich tax cut, should be considered in the context of the decision. “Just do something” says Broder, regardless of whether it makes sense. Learn nothing from history. Repeat our mistakes over and over, regardless of the cost in blood and treasure to our country and our soldiers. Forget not only Iraq, but Vietnam as well.

It’s hard to believe, I know, but there it is in black and white….

Eric Alterman is a Senior Fellow at the Center for American Progress and a Distinguished Professor of English at Brooklyn College. He is also a Nation columnist and a professor of journalism at the CUNY Graduate School of Journalism. His seventh book, Why We're Liberals: A Handbook for Restoring America's Most Important Ideals, was recently published in paperback. He occasionally blogs at http://www.thenation.com/blogs/altercationand is a regular contributor to The Daily Beast.

This article was published by the Center for American Progress.

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Capitol Idea: The President Can Make 'Democracy Stronger' at Ft. Bragg

2009-11-20T18:27:00.007-05:00

By Scott Nance

What's wrong with this picture?

In a highly publicized appearance in China earlier this week, President Obama lectures the Chinese against political censorship. He goes so far as to invite criticism of him personally, saying such debate makes "our democracy stronger."

But by the end of the week back home, the Army bans media coverage of once — and perhaps future — Obama rival Sarah Palin because the service fears political statements against the president among troops who may come out to see the Republican former Alaska governor.

Anyone across the political spectrum easily sees here a disturbing double standard emerging.

Obama was right in China in arguing for openness and non-censorship in the town hall meeting he held in Shanghai when he said:

"But the truth is that because in the United States information is free, and I have a lot of critics in the United States who can say all kinds of things about me, I actually think that that makes our democracy stronger and it makes me a better leader because it forces me to hear opinions that I don't want to hear. It forces me to examine what I'm doing on a day-to-day basis to see, am I really doing the very best that I could be doing for the people of the United States."

Unfortunately someone at Fort Bragg didn't get that particular memo when they decided to ban reporters from covering Palin's book tour stop there — an event that otherwise is completely on-the-record and open to the public.

The 2008 Republican vice presidential candidate, Palin is on the road to promote her new book, Going Rogue. And she may well wind up facing off against Obama as the GOP's presidential nominee in 2012.

Outrage over the Army's media ban has nothing to do with what you think of Palin as a person or politician. One can disagree entirely and intensely with the full range of Palin's policies and politics and still find the Army's decision wrong and indefensible.

What makes matters worse is that Army's reported basis for its decision is specifically based on nothing more than shielding Obama from potential embarrassment.

The Associated Press and the The Fayetteville Observer are right to protest the decision.

As it stands, Obama shouldn't be held directly responsible for the Army's media ban at Fort Bragg. Indications are that he did not directly influence or countenance the decision. It obviously comes from those much further down the chain of command.

Obama may not have initiated the decision, but it would be wrong for him to benefit from it.

As the Commander in Chief, Obama can reverse the media ban and allow reporters and cameras to Fort Bragg to cover whatever happens when Palin arrives to sell her books — even if the troops embrace Palin and criticize Obama.

Doing so will eliminate any air of hypocrisy on his stated position against censorship — and nothing would put a stronger exclamation point on his message to the Chinese a world away.

The publisher of On The Hill and its sister sites, Life, The Universe ... and Politics Live, Scott Nance has covered government and Washington for more than a decade. Capitol Idea is his regular column from Washington.

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Progressives Cheer Senate Health Bill As Right Attacks Bill On Abortion Grounds

2009-11-20T06:00:00.006-05:00

Progressives and ardent supporters of a healthcare public option are cheering the Senate version of health reform legislation to emerge Thursday. Social conservatives, meanwhile, are attacking the bill for lack of an anti-abortion amendment that had been included in the House version.

Senate Majority Leader Harry Reid unveiled Senate health reform legislation that includes a version of federally run public option health coverage. The Senate bill, known officially as the Patient Protection and Affordable Care Act, will face its first key test in an unusual procedural vote Saturday.

“The legislation deserves much praise," says Sen. Jay Rockefeller (D-W.Va.), perhaps the most outspoken advocate in the Senate for inclusion of a public option. "The bill will drive down costs and improve the quality of health care, stop health insurance companies from denying care to people who need it, protect coverage for children in the Children's Health Insurance Program (CHIP), safeguard Medicare for seniors with the Independent Medicare Advisory Board, offer a public health insurance option to drive down costs and keep health insurance companies honest and accountable.

“Health care reform took a huge step forward this week," Rockefeller adds. "In the days ahead, it will take the courage and commitment of my colleagues to get this promising legislation across the finish line. In the end, I am confident that Congress will stand up for the American people and fix our broken health care system once and for all."

Meanwhile, Rockefeller and Sen. Al Franken (D-Minn.) are both touting a specific new regulation on private insurers that Reid included in the Senate package.

The bill contains provisions that require insurance companies to spend a set portion of their insurance premium dollars on actual health care services, as opposed to marketing campaigns, CEO salaries, and administrative costs, according to a statement released by Franken's office. This portion of the insurance dollar, known in the industry as “medical loss ratio,” has been set at 80 cents for group insurance plans and 75 cents for individual plans, the statement says.

“It is time for health insurance companies to spend the money they collect from consumers on actual medical care, not executive salaries and fancy office buildings,” says Rockefeller, chairman of the Senate Finance Subcommittee on Health Care. “This is a common-sense solution in a strong bill, and it says that we are serious about keeping health insurance companies honest and protecting consumers first.”

“Minnesota families need to know that when they send their health insurance premium dollars to their insurance companies, that money is being spent on making and keeping them healthy – not on bloated profits, bonuses, or advertising,” says Franken. “This was a common-sense solution I was proud to fight for and I’m thrilled to see it included in our Senate bill. It’s going to go a long way toward improving care and holding insurance companies accountable.”

Meanwhile, prominent social conservatives are assailing Reid and the Senate bill because it does not include language similar to an amendment included in the legislation approved by the House limiting coverage of abortion.

"The Reid bill authorizes the Secretary of HHS to fund abortion in the public option, now called the 'community health insurance option,'" says Tony Perkins, president of the conservative Family Research Council. "The bill provides tax credits for private plans that cover abortion-on-demand, mandates plans across the country to cover abortion-on-demand and strips important conscience protections for providers who refuse to perform elective abortion.

"The Stupak-Pitts amendment adopted with 240 votes in the House would prevent federal funding for abortion or subsidies for plans that cover abortion," Perkins says, referring to the abortion restrictions named for its key authors, Reps. Bart Stupak (D-Mich.) and Joseph Pitts (R-Pa.). "It also makes clear that individuals or groups are not prevented from providing coverage that includes abortion as long as federal funds are not used.

"Clearly the straightforward language of the Stupak-Pitts amendment is not what Senator Reid and his pro-abortion colleagues want. Rather they want government funding of abortion-on-demand," Perkins says.

Although Reid did not include the Stupak-Pitts legislative language, Reid has amassed a record as being against abortion.

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When News Falls in the Forest

2009-11-19T05:34:00.004-05:00

by Stephen Engelberg, ProPublica

On June 26, a joint ProPublica-Washington Post story included what turned out to be startling news. The Obama administration, we reported, was "strongly considering criminal charges in federal court for Khalid Shaikh Mohammed and three other detainees accused of involvement in the Sept. 11, 2001, attacks on the United States.’’

This line, in a page-one story in one of America’s leading newspapers, provoked hardly a ripple. There were no impassioned speeches on the floor of Congress. All was quiet in the blogosphere.
When Attorney General Eric Holder announced last week that Mohammed and four others would be tried in New York federal court, the journalistic and political worlds exploded.

Republicans and some Democrats condemned the idea as misguided, naïve and downright dangerous. Families of the 9/11 victims were outraged.

The question of why and when a particular development ignites broader passions is one of journalism’s enduring mysteries. Reporters and editors are notoriously poor at forecasting when a story will erupt. We’re steeped in our material and can lose the sense of how our work might be perceived by the wider public.

Presentation makes a difference. Our mention of a possible Mohammed trial came in the middle of a story that focused on the legal challenges posed by Obama’s plan to close Guantanamo Bay. If it had been the opening paragraph or headline, it might have attracted more attention. Our story was also sourced to unnamed officials; last week’s official decision was unveiled at a well-attended press conference.

Timing also matters. Holder revealed his decision just a few weeks after the eighth anniversary of the 9/11 attacks. Then there are the details. Holder’s announcement included a poignant fact that deepened the story’s emotional punch: The trial will take place at a courthouse just a few blocks from Ground Zero.

Here at ProPublica, we spend a fair amount of time thinking about how stories will be received. Our goal is to do journalism that spurs change and halts abuses of power. As we choose what to investigate, we try to pick topics on which we can have the greatest impact.

Sometimes, we guess right. Our reporting on the lax regulation of nurses in California prompted sweeping changes within days. Our writing on Guantanamo prisoners has been consistently ahead of the pack, defining key issues. And our ongoing work on natural gas drilling has slowly but surely changed the national debate on a subject that just 18 months ago was understood by only a few scientists and industry insiders.

But we have also been too early – or too late – and watched seemingly compelling stories get lost in the clamor of viral videos, cheating starlets, mendacious beauty queens. Investigative reporters are the wildcat oil prospectors of journalism. We sink a lot of wells, and it’s sometimes a surprise when we hit a gusher. This uncertainty is an essential aspect of investigative reporting. And it’s why cash-strapped news organizations are backing away from it. No one can say how a story will end. And no one can really predict what it will accomplish. It makes the field alluring and sometimes maddening.

Write to Stephen Engelberg at stephen.engelberg@propublica.org

ProPublica is an independent, non-profit newsroom that produces investigative journalism in the public interest.

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Bill Aimed At Curbing Rising Childhood Hunger

2009-11-18T05:56:00.006-05:00

Sen. Sherrod Brown is citing a recent government report which found a dramatic spike in the number of Americans, including children, going hungry as a reason to approve his Hunger Free Schools Act.

The Ohio Democrat says his bill would help enroll more students who qualify for nutrition assistance in the school lunch program by increasing the program's efficiency through technology improvements and paperwork reduction.

A federal report indicates that the deep economic recession has caused nearly 50 million people -- including almost one child in four -- to become in doubt as to where their next meal will come from. The report shows that 17 million households, or 14.6 percent of the nation, experienced hunger and "food insecurity." These 2008 figures represent the highest rate of food insecurity since these surveys were initiated in 1995. According to the report, more than 500,000 families experienced hunger multiple times over the course of the year.

The U.S. Department of Arigulture says that the fundamental cause of food insecurity and hunger in the United States is poverty -- marked by a lack of adequate resources to address basic needs such as food, shelter and health care.

"With the difficult economic climate in Ohio, the number of school children utilizing the free and reduced price meals as well as summer and afterschool programs has increased markedly this year," Brown says in a statement. "Yesterday's news that more children and families were food insecure last year than the year before-almost 15 percent- was sobering and I hope it will serve as a wake-up call for us to get serious about reducing hunger."

Brown is chairman of the Senate Agriculture Committee subcommittee on hunger, nutrition and family farms.

In June, Brown introduced this legislation to improve and expand access to the school lunch program for needy children. This legislation would promote direct certification, whereby children enrolled in the Supplemental Assistance Nutrition Program (SNAP) and Temporary Assistance for Needy Families (TANF) are automatically eligible for free school lunch. It would also reduce paperwork and administrative costs, and utilize technology.

Specifically the legislation would:

• Improve state performance in enrolling eligible children in school lunch program by setting a performance standard (reaching 95 percent of students required to be directly certified for school lunch programs) and providing incentives to high performance schools;

• Expand access to child nutrition programs by requiring school districts to utilize data from Medicaid and the State Children's Health Insurance Program to directly certify more students for free school meals; and

• Achieve universal access for high poverty schools by allowing schools or districts serving a high proportion of low-income children to offer free lunches to all students.

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Senate Defeats Attempt To Block Closing Gitmo

2009-11-17T22:16:00.006-05:00

Some 57 senators voted to defeat a Republican proposal that would have prohibited the use of funds to construct or modify prison facilities to hold individuals currently being detained at the detention facility at Guantanamo Bay, Cuba.

In his first act upon taking office this year, President Obama set a deadline of January 2010 to close the Guantamamo prison, which was established during the Bush administration to hold detainees in the Bush "war on terror."

That goal to close the Guantanamo facility, which has long been site of torture and human rights abuses, has come under criticism, most recently in the form of an amendment to the Military Construction and Veterans Affairs Appropriations Act by Republcan Sen. Jim Inhofe of Oklahoma. The Inhofe amendment was opposed by Attorney General Eric Holder, Secretary of Defense Robert Gates and Secretary of Homeland Security Janet Napolitano.

The overall appropriations bill is one of the regular annual spending bills Congress must pass each year to keep up regular federal operations.

The amendment in question would have prohibited any funds from being used to construct or modify any facility in the United States to hold any individual who is currently being held at the Guantanamo Bay detention facility. The Obama administration has decided to shift prosecution of terror suspects from strictly military tribunals to instead trying masterminds of the Sept. 11, 2001, attacks in federal court in New York City, including Khalid Sheikh Mohammed.

Some 200 prisoners remain held at Guantanamo.

"As a former prosecutor, I find it deeply troubling that the Senate would be asked to prohibit the administration from trying even dangerous terrorists in our federal courts," says Sen. Patrick Leahy (D-Vt.), chairman of the Senate Judiciary Committee. "As a senator, I find it shameful that Congress is being asked to help keep open a facility that has been a stain on our reputation throughout the world and has given ammunition to our enemies. General Colin Powell was correct when he said, 'Guantanamo has become a major problem for America's perception as it's seen; the way the world perceives America.'"

Proposals such the Inhofe amendment "undermine the good work the President is doing, and they make us less safe, not safer," Leahy says.

Leahy cites those GOP senators, including Obama's 2008 rival, Sen. John McCain of Arizona, who have called for closing Guantanamo.

"Much debate has focused on keeping Guantanamo detainees out of the United States. In this debate, political rhetoric has entirely drowned out reason and reality.," Leahy says. "Our criminal justice system handles extremely dangerous criminals, and more than a few terrorists, and it does so safely and effectively. We try very dangerous people in our courts and hold very dangerous people in our jails throughout the country. I know; I put some of them there. We do it every day in ways that keep the American people safe and secure, and I have absolute confidence that we can do it for even the most dangerous terrorism suspects."

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What Health Care Reform Means for: Medicare Programs

2009-11-17T05:15:00.004-05:00

by Sabrina Shankman and Olga Pierce, ProPublica

Using results from a questionnaire we did with American Public Media’s Public Insight Network, we’re looking at how the proposed health care reforms will actually affect people facing common health care coverage situations. This is the third in a series (Part 1, Part 2).

Graydon DeCamp

Age: 75 Location: Elk Rapids, Mich. Work status: Retired Income: About $75,000, including SSI

Graydon DeCamp, 75, is one of about 11 million members of Medicare Advantage, the HMO option under Medicare that is administered by private insurers. Like many members of the plans, he says he is very happy with his coverage.

Medicare Advantage has been a major flash point in the health care reform debate, giving fodder to opponents of reform who say that Medicare would be cut to pay for the proposals. Our analysis of the impact of reforms on one very satisfied Medicare Advantage member finds the changes would be a loss for many seniors, but a win for taxpayers.

About Medicare Advantage: The elderly can participate either in traditional Medicare, which is administered by the government, or in Medicare Advantage, which subsidizes HMO plans administered by private insurance companies.

The private plans offer many perks – low or zero cost-sharing, comprehensive prescription drug coverage, even gym memberships. But they also have a downside: As in other HMOs, prior authorization is needed for many services, and members are limited to certain doctors and hospitals.

The relatively new Medicare Advantage is more expensive for taxpayers, however. In 2003, the Republican-controlled Congress wanted to make sure that seniors, especially those in rural areas, had access to a range of HMOs. (This was a problem that plagued an earlier version of the Medicare HMO program.) So it agreed to pay health insurers more per person than it would cost if they were in traditional Medicare. Today that gap is about 12 percent.

Neither the House health care reform bill nor the Senate Finance Committee bill eliminates Medicare Advantage, but both would reduce what the government is willing to pay. The boon for private insurers from higher premium subsidies has long been a prime target for budget savings, especially among Democrats in Congress. So – not surprisingly—cuts have turned up in the reform bills. Those provisions have proven to be some of the most contentious in the debate.

President Barack Obama insists there are not cuts to Medicare in the health care reform packages, though many don’t see it that way.

His story:

Graydon DeCamp says he couldn’t be happier with his Medicare Advantage plan. He switched to it after his premium for traditional Medicare and private supplemental insurance skyrocketed to more than $1,000 a month even though, DeCamp says, he’s a healthy guy.

Now, in Medicare Advantage, he pays $148 per month for a plan that also features low co-payments. A few years ago he had two detached retinas, which resulted in five surgeries. His out-of-pocket expenses, he says, didn’t go over $500 or $600. Prescriptions that he takes for ongoing eye problems cost him $55 every three months.

“I’ve got no complaints,” he says.

What health reform may mean for him:

DeCamp’s premiums will probably increase, and he may have fewer plans to choose from. If the government decreases its subsidies to Medicare Advantage plans, the plans will likely pass their increased costs on to people like DeCamp, resulting in higher premiums. The House bill calls for $172 billion in savings over the next 10 years from reducing Medicare Advantage payments to insurers to the same amount paid for traditional Medicare – a significant chunk of the roughly $570 billion in savings from changes to Medicare overall. Likewise, the Senate Finance Committee’s bill calls for $470.2 billion in Medicare savings, of which 25 percent ($117.6 billion) would come from Medicare Advantage cuts. The bill would generate those savings by establishing a bidding process for plans.

Because DeCamp lives in northern Michigan, he may also see fewer Medicare Advantage plans to choose from as subsidies under both proposals decrease.

Overall, DeCamp would likely fare better under the Senate Finance Committee proposal, which includes more protections to soften the impact of reduced subsidies. If the bids include significant cuts to benefits, the government would temporarily step in.

The proposed reforms also call for some improvements to Medicare Advantage coverage. The Senate Finance bill prohibits HMOs from charging people more than traditional Medicare for certain services, such as chemotherapy, renal dialysis and skilled nursing care. It also offers bonuses to plans that offer superior quality of care and care coordination. And the House bill provides bonus payments to high-quality plans, and requires that a list of high-quality and improved-quality plans be provided on the Medicare Web site.

If his plan becomes too expensive, DeCamp could switch back over to traditional Medicare. Under both bills, preventive services would be free (see the Senate provision and the House’s). And both have provisions for reducing fraud and waste, which drive up Medicare costs.

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GM Announces It Will Pay Back Gov’t Loan … With Gov’t Money

2009-11-16T21:30:00.002-05:00

by Paul Kiel, ProPublica

GM will be begin paying back the TARP money in December, the company announced this morning. It’s a statement in need of a little context.

Basically, GM will be using a portion of its $50 billion in TARP bailout money it received to in turn repay another portion of the TARP loans.

The reason GM can do this is because when GM emerged from bankruptcy, it struck a deal with the Treasury Department to carve up its obligation to the government in four different ways.

They are, briefly: 1) $986 million remained an obligation of the old GM, the husk of the company left behind through its bankruptcy restructuring, and will never be seen again, 2) $6.71 billion remained as an interest-bearing loan, 3) $2.1 billion of the obligation was converted to preferred stock, which is a form of equity ownership that pays a fixed dividend, and 4) the rest was converted to a 60.8 percent equity stake in GM.

So, for GM to completely pay back the government, GM would have to completely repay the $6.71 billion loan with interest, purchase the government’s preferred shares (as well as keeping up dividend payments), and Treasury would have to make a pretty penny, in the range of $40 billion, selling its common shares after GM goes public again.

In a comprehensive overview (PDF) earlier this month, the GAO deemed that scenario “unlikely.” The former chief of the auto task force went farther, saying that $20 billion of the $50 billion given to GM probably won’t be coming back.

GM’s announcement today was just about No. 2, that $6.71 billion loan—it will begin repaying next month, it said. But the money to repay the loan will come from a portion of the government money it has set aside. In other words, GM has not actually drawn down every dollar of the $50 billion. It has about $13.4 billion sitting in an escrow account, and it’s tagged $8.1 billion of that to repay loans it owes both the U.S. and Canadian governments. (Incidentally, GM also got a $1.3 billion loan from Germany in support of its European unit.)

And there’s your context. Essentially, the good news is that GM thinks it won’t need to draw down more than about $40 billion of the $50 billion the U.S. gave it.

As with all other recipients of the bailout, we continually track GM’s progress towards making the taxpayer whole. Since last December, GM has paid the Treasury $178 million in interest (before bankruptcy) and dividend payments. Meanwhile, about $50.4 billion remains outstanding.

Note: Not dealt with here for simplicity’s sake is $884 million which Treasury used to purchase a portion of GM’s equity in GMAC, its financing arm. In exchange, Treasury received a 35 percent equity stake in GMAC.

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Happy Birthday, Gitmo

2009-11-13T16:27:00.004-05:00

by Dafna Linzer, ProPublica

Much has occurred today with regards to Guantanamo Bay and many decisions are yet to come.

But there is another milestone worthy of note: Today marks the eighth anniversary of the creation of the legal foundation for the prison and the second-tier justice system established to try terrorism suspects there.

On Nov. 13, 2001, former President George W. Bush signed what has become known as Military Order No. 1 in what he termed a Global War on Terrorism. Without informing his national security adviser, his secretary of state, his chief of staff or his communications director, Bush approved what would appear three days later in the Federal Register as: "Military Order of November 13, 2001 Detention, Treatment, and Trial of Certain Non-Citizens in the War Against Terrorism."

The few people inside the former administration who knew about the order were instrumental in its creation, including former Vice President Dick Cheney, his lawyer David Addington, former Secretary of Defense Donald Rumsfeld, former Attorney General John Ashcroft and a young, and then unknown, lawyer inside the Justice Department named John Yoo [6].

The order created a separate track of justice for any foreign citizen picked up on a global battlefield with the Pentagon serving as jailer, prosecutor and judge.

The findings, drafted in secret, also laid the way for many of the asserted war powers that the Bush administration later relied on.

"It was a foundational building block of the war on terror's legal architecture," said Matthew Waxman, a professor at Columbia Law School who worked on detainee issues during the Bush administration.

But those blocks began to crumble -- under legal challenge, political opposition and global outrage over a prison that Obama would come to describe as a stain on America's "moral authority."

Detainees began arriving in Guantanamo two months after Bush signed the order and almost immediately world leaders lined up to condemn the facility. In a landmark 2006 ruling, the Supreme Court ruled that the military commission system that had been in place for Guantanamo Bay violated U.S. and international law, and that the Geneva Conventions applied to the detainees.

Detainees now have rights to challenge their detention and the military commissions have been revamped.

All told, since Military Order No. 1 came into effect, the prison at Guantanamo has ballooned in size and notoriety. Nearly 800 detainees have been housed there. Six have died there; more than 500 have gone home. More than 200 are still there, in limbo.

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Govt’s Attempt to Push Transparency for Mortgage Mods Falls Short

2009-11-13T05:02:00.003-05:00

by Paul Kiel, ProPublica

For months, housing advocates have complained that mortgage servicers are wrongfully denying homeowners’ applications for the administration’s $50 billion mortgage modification program. Last week, the Treasury Department took a step to address those concerns: For the first time, it issued guidelines requiring mortgage servicers to give homeowners details about why they’ve been denied. But the required disclosure will only be partial, and housing advocates say that means servicers’ denials of loan modifications will still be shrouded in secrecy and protected from scrutiny.

Along with other outlets, we’ve documented the frustrations and confusion that have plagued the program since its launch. Neither the government nor servicers have yet released data on how many homeowners have been turned down or the reasons for those denials.

“I find it distressing that even after all this time they’re not providing for full transparency,” said Diane Thompson of the National Consumer Law Center. Homeowners and advocates still won’t “get the information they need to tell whether the program is being applied correctly or not.”
Typical for a program that has taken months to get off the ground, the new guidelines won’t go into effect until Jan. 1, 10 months after the government’s loan mod program launched.

At the center of the program is a business decision. Once a homeowner applies and clears the initial hurdles for eligibility, the servicer is supposed to run the submitted financial information through a formula that produces the “net present value” (NPV) of the loan under two scenarios: If it’s modified or if it’s not modified.

The NPV, which Treasury created especially for this program, essentially tells the servicer whether the loan’s owner (typically a bank or investors in a mortgage-backed security) would make more money through modification. If so, the servicer is required to modify the loan. If not, the servicer can opt not to. The main strategy of the program is to provide servicers and investors with thousands of dollars in incentive payments for each modification in order to tip the scale toward modification.

Yet, as we’ve reported, this all-important government-mandated formula has remained a secret, drawing sharp criticisms from advocates. The Treasury Department’s new requirements, detailed in a Nov. 3 letter to mortgage servicers, only partly address those criticisms.

Servicers now must inform borrowers why, in general terms, they’ve been turned down. If it’s because of the NPV test, servicers will be required to provide a selection of some of the inputs used in calculating the NPV — such as the borrower’s monthly gross income and FICO score, among others — and give homeowners the opportunity to see what numbers were used for those select inputs.

But key inputs can still remain a secret. Crucially, servicers don’t have to disclose their estimate for the current market value of the home. According to Thompson, servicers often get the estimates wrong.

If one of the numbers produced by the servicer is wrong, homeowners will then have the chance to say so. But that’s where a homeowner’s alternatives end. Homeowners will not have an opportunity to appeal if they think that a servicer is using the wrong values. And as we reported earlier, Freddie Mac has been contracted to audit servicers, but still seems stuck at Square 1.

A Treasury spokeswoman declined to respond to criticisms of the new guidelines. Thompson said Treasury officials have told housing advocates that they fear that forcing a servicer to divulge its estimate of the home’s value would result in an excessive number of challenges by homeowners.

The lack of transparency means the process is likely to remain an often bewildering one for homeowners.

Deborah Sherman, of Oakland, Calif., isn’t sure that she qualifies for the program, but she does know that Chase Home Finance’s reasons for turning her down don’t make sense. Back in June, we profiled Sherman as typical of struggling homeowners who’ve been waiting months for an answer to her application. Sherman finally got that answer at the end of September: She was declined.

The reasons, as given in a one page letter (pdf), were that she had too little income and too much equity in her home – neither of which, on its own, is a legitimate reason for a servicer to decline the modification. Both income and equity are among the inputs considered in the NPV calculation, but all that matters is the result of the test. The inputs should not be considered in isolation.

Below is an excerpt of the rejection letter:

the above referenced account through the Making Home Affordable (MHA) program. After researching your account, we have determined that at this time you do not qualify for a modification under the MHA program or any other modification program we offer for the following reason(s):

Your income is insufficient for the amount of credit you have requested.
Your property equity exceeds our program guidelines.

The Chase case manager handling Sherman’s case wrote her in an e-mail that she could have no more than 20 percent equity in her home to qualify (Sherman’s second mortgage wasn’t considered in the analysis). Since the formula gives no limit – or minimum – for equity, Chase seemed to be using its own criterion for evaluating Sherman’s application.

Tom Kelly, a spokesman for Chase, disputed that, and said that, when evaluating an application, its representatives simply “plug the numbers into the formula and see what happens.” The Chase case manager who handled Sherman’s case “might have been mistaken,” he said, about the existence of an equity limit, but he would not discuss the specifics of Sherman’s case.

Debi Pelletier of Port St. Lucie, Fla., had a similar experience with CitiMortgage. After applying for a modification, she was told on the phone by a Citi employee that her problem was that she had just a little too much equity, that she was “right on the edge,” but that she was denied. (Like Sherman, Pelletier also has a second mortgage. The administration’s program currently applies only to first mortgages.) A later phone call with another Citi employee brought another reason, she said: She had to draw more on her savings before she could hope for a modification. Another Citi employee later told her that wasn’t the case.

Mark Rodgers, a spokesman for Citi, declined to comment on Pelletier’s case, but said Citi does not reject homeowners simply based on the amount of equity.

Homeowners who hear from their mortgage servicer after January shouldn’t expect much more information.

“I’m getting scared about losing everything,” said Pelletier, whose income was reduced when she lost her job earlier this year. She eventually found another job, though it’s lower paying, and has been struggling to stay current on her mortgage. She still doesn’t understand why her application was denied. She said she thought the program “was for people on the edge, who’d lost money, who were on the edge of foreclosure.”

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Watchdog: Big Health Insurer Pushing Its Workers To Lobby Against Public Option

2009-11-12T20:47:00.006-05:00

The largest U.S. private health insurer is urging its employees to lobby the Senate against comprehensive healthcare reform that includes a public option, according to an advocacy organization that has unearthed the effort.

United Healthcare, launched a new push this week to get employees to directly lobby senators for weaker health reform. The new campaign, in an e-mail sent to all employees Nov. 10, offers employees template letters to send from company computers on company time and urges them to write grassroots-style letters to the editor to local newspapers.

Consumer Watchdog, an organization that supports healthcare reform that includes a federally run public insurance option, says it obtained the letters and calls on the Senate and newspapers to reject the corporate-directed campaign.

Action on comprehensive healthcare reform is now focused squarely on the Senate, as the House last week approved a reform plan that includes a public option. Senate Majority Leader Harry Reid (D-Nev.) has said the Senate health reform legislation will include a public option that states may opt out of.

The form letters call on the Senate to resist any publicly financed health care option, prevent financial reform of bloated payments to private Medicare Advantage insurance plans and enact tougher penalties on Americans who fail to buy private insurance.

The instructions to United Healthcare (UHC) employees for writing a local letter to the editor do not suggest that employees identify themselves as UHC employees, only that they "share their unique perspective," according to a statement from Consumer Watchdog.

Health insurer Cigna also sent out a companywide e-mail urging employees to contact lawmakers. Its talking points remain behind an internal e-mail barrier, Consumer Watchdog says.

The health insurance industry has been lobbying hard against healthcare reform provisions, particularly those related to a public option that would compete with them. President Obama has long supported inclusion of a public option to, in his words, keep private insurers "honest." Supporters of the public option, including House Speaker Nancy Pelosi, also believe a public option would go far to contain skyrocketing healthcare costs.

This is United Healthcare's second major push to persuade employees to lobby on behalf of the company. Consumer Watchdog says it protested the first campaign in September as undue and possibly illegal political pressure on employees. The company's new campaign states more strongly that the lobbying campaign is voluntary. However, the company has access to email sent by employees, and it explicitly tells employees to "share a copy with us" of any letters to the editor. The company is likely tracking employee responses to the internal email request, according to Consumer Watchdog.

According to Consumer Watchdog, the message sent to all employees also says: "It is important that we, as members of the health care industry and as individuals, make our voices heard on this important issue. Therefore, we encourage you to actively participate in this debate as both industry voices as well as individuals. Please take action by writing a letter to your elected officials in Washington."

Consumer Watchdog says the request is intimidating.

"No United HealthCare employee would modify the lobbying letter to favor Medicare-for-All, or even a modest public option, knowing that his or her managers may be reading that e-mail," says Judy Dugan, research director of the nonprofit, nonpartisan Consumer Watchdog. "They wouldn't dare to speak against the company position unless they've already got a new job lined up."

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The Big Gov’t Mortgage Mod Program: The Latest Numbers

2009-11-12T05:51:00.003-05:00

by Paul Kiel, ProPublica

The administration’s $75 billion mortgage modification program is meant to help 3 million to 4 million homeowners avoid foreclosures. The latest data, out Tuesday, shows mortgage servicers are making some progress toward this goal, but big questions remain about how effective the program will be.

Here’s our breakdown for the largest servicers. Among the four largest, Bank of America still lags far behind. According to the government’s data, BofA’s mortgage subsidiaries have started a total of just 137,000 trial loan modifications, about 14 percent of its pool of eligible loans.

Through October, about 651,000 borrowers overall had obtained trial modifications, a three-month period to test whether the homeowner can make the new, lower monthly payments. But as we noted last month, the crucial metric for the program is how many homeowners make it into permanent modifications. That’s information the administration won’t release until later this month, said a Treasury Department spokesperson.

As of Sept. 1, only 1,711 had made it all the way to get permanent modifications, at least in part because servicers had been slow with processing the loan mods.

Testifying before the TARP’s Congressional Oversight Panel last month, Herb Allison, the Treasury Department’s bailout chief, said it probably would be early next year before Treasury had “a much better idea statistically of how many people are moving from trial to permanent mods.” Asked what Treasury had estimated the success rate might be of moving from trial to permanent mods, he said past experience with loan modifications suggested that a 50 percent success rate should be the “bare minimum,” and that if it were up to 75 percent, “we would deem this quite a successful program.”

Since the monthly releases detail only trial mods, they should be treated with some caution.

Meanwhile, we’ve reported on the numerous difficulties homeowners have faced just getting to the trial stage. The servicers are making some progress, but that progress has not showed much sign of accelerating since the summer. The upshot: For homeowners, getting a loan mod remains a slog every step along the way.

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Paid Leave Bill 'Necessary' In Light Of H1N1 Flu Pandemic

2009-11-11T11:58:00.010-05:00

The Obama administration has endorsed legislation to mandate paid time off for millions of American workers, particularly to come to the aid of those who fall ill from the H1N1 influenza pandemic.

"It's common sense and good business sense - workers should be able to stay home if they are ill," says Deputy Secretary of Labor Seth Harris. "The Healthy Families Act offers a great opportunity to level the playing field for workers and gives them the ability to stay home if they are sick without fear of losing their jobs or being forced to work sick."

Harris revealed the administration's support for the measure in testimony Tuesday before a Senate subcommittee. The Healthy Families Act was introduced by Sen. Ted Kennedy (D-Mass.) earlier this year before his death this summer, and would require employers with 15 or more workers to provide seven days of paid sick leave annually for their own medical needs or to care for a family member.

Supporters of the legislation note that the Family and Medical Leave Act provides unpaid -- not paid -- leave to U.S. workers facing medical issues.

"Paid sick days has always been a good, common sense idea, but, in light of the recent H1N1 epidemic, it has also become a necessary one," says Rep. Rosa DeLauro (D-Conn.), who has introduced similar legislation in the House.

Some 57 million Americans cannot take time off work when they are sick, or when they need to stay home to care for an ailing child or elderly relative, DeLauro says.

"In fact, almost half of all private sector workers -- and 79 percent of low-income workers -- do not have a single paid day off. The numbers are particularly
galling in the food service industry, where only 15 percent of workers have paid sick days. Suffice to say, food service is not an industry where we want employees showing up to work with contagious viral infections."

DeLauro cites a 2008 study that found one in six workers report that they or a family member had been fired, suspended, punished or threatened with firing for taking time off due to personal illness or to care for a sick relative.

"To my mind, this is completely unacceptable. It goes against who we are as a nation," she says. "But, even if you do not agree that providing paid sick days is a question of basic American values, there is more to this issue. Establishing paid sick days is also about economic competitiveness, income security for families, and, as H1N1 has proved to us this past year, primarily the public health."

DeLauro cites data that indicates that the practice of “presenteeism” – the practice of coming to work sick – costs the national economy more than it would cost to provide paid sick days. According to one study, $180 billion is lost annually, meaning that, right now, employers pay an average of $255 per employee per year in lost productivity, more than the cost of absenteeism and medical and disability benefits, she says.

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ACLU Sues FBI for Imprisonment of New Jersey Man in Africa

2009-11-10T17:08:00.003-05:00

by Christopher Flavelle, ProPublica

The American Civil Liberties Union has filed a lawsuit against the Federal Bureau of Investigation, saying it illegally detained and mistreated an American, Amir Meshal, who was held in Kenya, Somalia and Ethopia for four months in 2007 before being released.

According to the ACLU’s complaint, which was filed in district court in Washington this afternoon, Meshal, who is now 26, traveled to Mogadishu, the Somalian capital, in 2006, to study Islam. In January 2007, he fled Somalia after fighting flared up in the country’s long-running civil war. He was arrested in Kenya by a joint U.S.-Kenyan-Ethiopian operation, the complaint alleges, then was transferred first to Somalia and later to Ethiopia. The lawsuit said he was interrogated more than 30 times by U.S. officials, including two FBI agents, who threatened him with torture and execution and denied him access to an attorney. Meshal, of Tinton Falls, N.J., was released that May and returned to the United States.

The complaint alleges that Meshal’s detention and treatment "was at the direction or behest of U.S. officials, or carried out with their active and substantial participation." The ACLU identifies two FBI agents by name, as well as two unknown employees of the U.S. government.

Jonathan Hafetz, an ACLU lawyer representing Meshal, said this is the first case of a U.S. citizen being the subject of rendition – held without charge by the U.S. government and transferred to a foreign country. Asked why Meshal is filing suit now, more than two years after being released, Hafetz said his client came to the decision "after living with this for a while." He added that Meshal "wanted some accountability for what happened. If it can happen to him it can happen to others."

While U.S. officials have previously said that FBI agents questioned Meshal while he was detained in Africa, the State Department said at the time that the U.S. government had no role in his deportation and had protested to the Kenyans, the New York Times reported in March 2007.

The FBI did not immediately respond to a request for comment about today’s complaint. We’ll include its response if we hear back.

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Congress Tells EPA to Study Hydraulic Fracturing

2009-11-10T16:51:00.004-05:00

by Abrahm Lustgarten and Sabrina Shankman, ProPublica

Five years ago the U.S. Environmental Protection Agency assured the nation that the technology credited with opening vast new natural gas supplies was safe. Now Congress has ordered the agency to take another look.

As part of the $32 billion Interior and Environment Appropriations Bill recently signed by President Obama, lawmakers asked the EPA to re-visit hydraulic fracturing, the process where copious amounts of water and sand mixed with toxic chemical additives are furiously pumped underground to break up gas-bearing rock thousands of feet below.

The bill urges the EPA to use a portion of the money to fund a scientifically robust and peer-reviewed study of the relationship between hydraulic fracturing and drinking water, "using a credible approach that relies on the best available science."

The EPA gave hydraulic fracturing its stamp of approval in a 2004 report, but that study has been widely criticized as politically-motivated and scientifically unsound. After the report was released, veteran EPA scientist Weston Wilson wrote a letter to Colorado representatives saying that "based on available science and literature, EPA’s conclusions are unsupportable." He also wrote that five out seven members of a panel that reviewed the findings had conflicts of interest and "may benefit from EPA’s decision not to conduct further investigation or impose regulatory conditions."

In 2008 ProPublica reported that EPA staff involved in the study negotiated directly with Halliburton, one of the leaders in the hydraulic fracturing business, and other stakeholders to soften inspection pressure from the agency. In exchange, the companies agreed to voluntarily stop using diesel fuel for some of their fracturing processes. That report was part of an investigation showing that water sources have been contaminated across the country from drilling.

The 2004 study was used to help justify the passage of an amendment in the 2005 Energy Policy Act which exempted hydraulic fracturing from coverage under the Safe Drinking Water Act.

Ever since, environmentalists and some Democratic members of Congress have been pushing for a reversal.

The new request for a study of fracturing is just one paragraph, deep in the 393-page bill that funds everything from drinking water infrastructure to Great Lakes conservation, and it does not specify an amount of money to be spent on the study.

The office of EPA administrator Lisa Jackson did not respond to requests for comment for this article. But the measure’s sponsor, Rep. Maurice Hinchey (D-NY), says he expects the EPA to follow through. "I think don’t think that there is any question that they are going to move forward on it," said Hinchey, adding that Jackson has indicated this to him directly.

Jackson previously said she recognized that the current regulations restrict the EPA's ability to protect groundwater and said the issue "was well worth looking into." But she hadn’t indicated how the EPA would approach the problem or whether the 2004 study would be revised.

The request for a new study comes six months after a matching pair of bills called the FRAC Act was introduced in the House and Senate. The Fracturing Responsibility and Awareness Chemicals Act –sponsored by Hinchey, among others – would repeal the oil and gas industry’s exemption from the Safe Drinking Water Act.

It’s not unusual for a study to be introduced as a way of delaying legislation. But Hinchey says this study serves a real purpose because there is a dearth of scientifically-neutral information about hydraulic fracturing.

"We are very sincere and deeply dedicated to getting this done," he said.

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'No' Votes on Health Care Bill Received $2.3 Million More from Health Insurance Industry

2009-11-09T20:57:00.005-05:00

Members of Congress who noted "no" on health care reform legislation late Saturday night have received $2.3 million more in campaign donations from health insurance interests than those who voted in favor of the legislation to overhaul of the nation's health care system, according to an analysis released by a coalition of campaign reform groups.

"The health care debate shows that our campaign finance system is as much in crisis as our health care system," says David Donnelly, national campaigns director of Public Campaign Action Fund, the watchdog group that conducted the analysis for the coalition. "As measured in campaign donations, it clearly pays to be against reform and with the health insurance interests."

The health insurance industry donated $12.5 million to the campaigns and leadership PACs of 215 members of Congress who voted against the House health care legislation this weekend. Members voting against the legislation received, on average, 24 percent more in campaign money than those who voted yes, according to analysis of campaign contribution data from the nonpartisan Center for Responsive Politics.

House Democrats approved their sweeping health reform package on a vote of 220 to 215. Just one Republican, Rep. Anh "Joseph" Cao of Louisiana, voted for the reform bill. Cao was elected to a largely Democratic district in New Orleans.

Prior to the historic vote, President Obama traveled to the Capitol personally to push for House passage.

"Opportunities like this come around maybe once in a generation," he said afterward. "This is our moment to live up to the trust that the American people have placed in us. Even when it's hard. Especially when it's hard. This is our moment to deliver."

Action to pass healthcare reform now swings back to the Senate, where the full Senate must approve a single version of healthcare reform. Senate Majority Leader Harry Reid has been crafting such a measure based on two distinct healthcare reform bills approved by the Senate Finance and Health, Education, Labor and Pensions (HELP) Committee.

The major trade group representing the health insurance industry attacked the House reform legislation after passage.

"The current House legislation fails to bend the health care cost curve and breaks the promise that those who like their current coverage can keep it. A new government-run plan will cause millions to lose their existing coverage and draconian Medicare Advantage cuts will force millions of seniors out of the program entirely," says Karen Ignagni, president and CEO of America's Health Insurance Plans (AHIP).

"This bill imposes inflexible mandates before getting everyone covered and new regulations that duplicate what is already in place at the state level. Many of these reforms begin in 2010 after employees have already chosen their plans and contracts have been negotiated. The result will be increased costs and massive disruptions in the quality coverage individuals and families rely on today," Ignagni adds.

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What Healthcare Reform Means For: Small Businesses

2009-11-09T05:23:00.001-05:00

by Sabrina Shankman and Olga Pierce, ProPublica

Using results from a questionnaire we did with American Public Media’s Public Insight Network, we’re looking at how the proposed health care reforms will actually affect people facing common health care coverage situations. This is the second in a series (Part 1).

Fairfield Lighting and Design, Office Manager Barbara D’Agostino

Location: Fairfield, Conn. Employees: 12 (10 receiving health insurance) Sales: $2 million annually Payroll: $384,000 annually

Their story:

Fairfield Lighting and Design has been in business since 1972, but it is struggling to cope with tough economic times. It has 12 employees, whose average wage is about $20 an hour. Because of the recession, opportunities to work overtime have dwindled, and the regular hours of some employees have been cut.

The recession has also made it difficult to keep paying their health care costs: Fairfield offers health insurance to 10 of its employees, at a company cost of $550 per employee each month.

The costs to each employee are relatively low. They pay only 20 percent of the premium, or $110 per month. Their co-payments are $15 to see a doctor or $500 for a hospital, and medications cost them $15, $25 or $50, depending on the type of drug.

But that could change. Fairfield Lighting and Design was recently notified that its coverage will be taken over by a new company, probably around the beginning of the year.

“Hopefully when this whole thing goes through maybe we can find something less expensive,” D’Agostino said. “Otherwise the employees may have to contribute a bit more.”

What health care reform would mean for them:

Two of the reform bills require that employers provide some minimum health insurance to employees or pay a penalty. The exception is the Senate Finance committee bill, which has no employer requirement.

But small businesses are exempt. Because Fairfield Lighting and Design has only 12 employees and a payroll of less than $500,000,it would not be required to provide health insurance under any of the health reform bills.

Each of the three bills gives small businesses tax credits for several years to provide relief from high insurance premiums until more comprehensive reforms are in effect – until 2015 for the House bill, and 2017 in the Senate Finance bill. The Senate health bill would offer a credit until state exchanges are up and running - up to three years. But some plans offer a lot more help than others. The Senate health committee bill would offer Fairfield a tax credit of about $10,000 per year, but because the average employee at Fairfield earns almost $40,000 – the cutoff for the subsidy in the other two bills—the House bill would extend a credit of only about $5,000, and the Senate Finance committee would give Fairfield only about $2,500.

Small businesses would also have the option under all three bills to buy insurance through a health insurance exchange, a pooling mechanism that would allow them to choose from a menu of private plans, which the Congressional Budget Office projects would be cheaper than private plans currently out there for small businesses.

Help won’t arrive right away under any of the proposals. The House bill, which phases small businesses into the exchange based on their size, would make Fairfield wait until 2013. The Finance committee plan would make Fairfield wait even longer – it won’t set up exchanges for small businesses until 2017. The Senate health committee plan would authorize the Health and Human Services secretary to start giving grants to states to start up health care exchanges right away, but it is unclear how quickly states would move.

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Federal Judge Rejects Tobacco Companies' Effort to Block Key Provisions of New Law

2009-11-06T17:51:00.005-05:00

A federal judge in Kentucky has rejected a motion by tobacco companies to block key provisions of the new law giving the Food and Drug Administration (FDA) the power to regulate tobacco products. Specifically, the decision strongly supports the government's authority to prevent the industry from making health claims about its products without FDA approval, according to an anti-smoking advocacy organization.

At issue are provisions contained within the Family Smoking Prevention and Tobacco Control Act, which President Obama signed into law in June. The landmark legislation gave the federal government sweeping new authority to control tobacco products.

Tobacco use is the leading preventable cause of death in the United States, killing more than 400,000 people and costing $96 billion in health care costs annually. The FDA established its Center for Tobacco Products to oversee enforcement of the law. Just this week, the FDA particularly warned cigarette makers about provisions within the law that ban cigarettes that contain certain flavors.

Eleven public health and consumer advocacy groups joined in the legal effort to thwart the industry's challenge to the law based on the claim that its First Amendment rights were violated.

U.S. District Court Judge Joseph McKinley denied a request from R.J. Reynolds and other tobacco companies to keep the FDA from implementing the law, saying they have "little likelihood" in proving that their free speech rights have been harmed. Judge McKinley forcefully backed the government's interest in protecting consumers from misleading claims about tobacco products with supposedly reduced health risks.

The judge agreed with the key argument that "given the significant health risks associated with the use of tobacco products and the history of marketing 'low tar' and 'light' cigarettes," the government "has a substantial interest in protecting consumers from misleading tobacco industry claims about allegedly reduced risk tobacco products."

The court's ruling supports the portion of the FDA law that requires tobacco companies to submit for the agency's review any claims of reduced risk. The FDA is empowered to determine if the claim is scientifically justified and benefits public health. McKinley cited a pivotal ruling in the Department of Justice's racketeering lawsuit against the tobacco companies, noting that tobacco companies have a "history of advancing their bottom line by misleading consumers about the health risks associated with their products."

The groups who joined the government in supporting the FDA law are: The Campaign for Tobacco-Free Kids, American Cancer Society, American Cancer Society Cancer Action Network, American Heart Association, American Legacy Foundation, American Lung Association, American Medical Association, American Public Health Association, Kentucky Medical Association, Oncology Nursing Society and Public Citizen.

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Think Again: This Fish Rots from the Head Down

2009-11-06T05:26:00.003-05:00

By Eric Alterman

Republican Representative Michelle Bachmann issued a call last week for a “house call” and a big party out on the National Mall next week, saying, “we’re going to tell Congress what they can do with their health care bill.” She went on to say that, “The American people realize this is it. Just like that brand new Michael Jackson movie came out, ‘This Is It.’ This is it for freedom. If you believe in liberty, and if you’re rejecting tyranny, this is it. Dr. Mark Levin wrote a seminal book that really swept this country called Liberty and Tyranny. And that’s what this debate is about next week. Liberty and tyranny.”

Leave aside that Ms. Bachmann likens her cause to that of a film glorifying an entertainer famous for dangling his children outside hotel windows and who is also repeatedly accused of child molestation. Such confusion on the part of Bachmann is nothing new for a woman who believes Barack Obama represents “really the final leap to socialism.”

To be fair, she’s not all that detail-oriented. Remember Bachmann's “interesting” (her word) observation “that it was back in the 1970s that the swine flu broke out then under another Democrat president, Jimmy Carter.” Actually, Gerald Ford was president during the last outbreak of the virus, but never mind that. Bachmann has also been known to complain about the disastrous “Hoot-Smalley Tariff,” which she says led Franklin Delano Roosevelt to turn the “recession into a depression.” Alas, the Smoot-Hawley Act was passed and signed during the administration of Republican President Herbert Hoover. The United States had already been in a depression for over a year.

I re-raise these incidents now because a couple of Sundays ago, George F. Will, America’s most distinguished conservative commentator—in light of the death of William Safire—recently wrote a column in which admired Bachmann as a “petite pistol that occasionally goes off half-cocked.”

And yet he found “admirable” her complaints of a “gangster government” and praises her as “an authentic representative of the Republican base” (at least I think it was praise).

This would be shocking were it not for the fact that Will has proven himself a crank of late in other, perhaps more significant ways. As Danielle Ivory and I wrote in this space not so long ago, Will has repeatedly attacked the alleged “Chicken Littles” of “eco-pessimism” who, of late, have been concerning themselves with the potentially dangerous effects of rising global temperatures.

And when we say “repeatedly” we meant it. Will is undoubtedly the only columnist who, in four separate columns since 1992, has quoted a Christian Science Monitor piece on global cooling from 1974, saying that “armadillos had left Nebraska, retreating south, and heat-loving snails had retreated from central European forests,” and that “Glaciers had ‘begun to advance.’”

Will was repudiated by his own newspaper’s newsroom, whose reporters, Juliet Eilperin and Mary Beth Sheridan, noted satellite data showing that the average multiyear wintertime sea ice cover in the Arctic in 2005 had declined, which “contradicts data cited in widely circulated reports by Washington Post columnist George F. Will that sea ice in the Arctic has not significantly declined since 1979.” So too did Andrew Freeman, at the Post’s weather blog, who noted: “George Will’s recent columns demonstrate a very troubling pattern of misrepresentation of climate science. They raise some interesting questions about journalism, specifically concerning the editing process.”

We spend a great deal of time in this space mocking the idiocies put forth by the likes of Glenn Beck, Bill O’Reilly, Rush Limbaugh, and Sean Hannity. I would not be honest if I did not hear mentions of mock shock from friends and colleagues who demand to know whether “Eric, are you really saying conservative commentators on cable talk radio do not always tell the truth?”

“If it has never before occurred to you that conservative polemicists might sometimes be dishonest or hypocritical, then this book will offer a good remedial education,” was the way an unfriendly New York Times Book Review writer characterized the widely recognized chef d’ouvre, Why We’re Liberals.

So now we’re asking a different question: What about George Will? Is he a Limbaugh-like entertainer who refuses to take responsibility for the content of his screeds? Or is he the conservative who has built a reputation over the past three decades for being the most intellectually scrupulous of all right-leaning pundits? And if this multifaceted embrace of crank politicians and crank scientists is not indicative a generalized intellectual decline on the part of conservative writers and thinkers, then who or what would be?

Just asking …

Eric Alterman is a Senior Fellow at the Center for American Progress and a Distinguished Professor of English at Brooklyn College. He is also a Nation columnist and a professor of journalism at the CUNY Graduate School of Journalism. His seventh book, Why We're Liberals: A Handbook for Restoring America's Most Important Ideals, was recently published in paperback. He occasionally blogs at http://www.thenation.com/blogs/altercation and is a regular contributor to The Daily Beast.

This article was published by the Center for American Progress.

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House Health Reform Bill Picks Up Big Support

2009-11-05T21:37:00.005-05:00

House Democrats picked up big support for their version of comprehensive healthcare reform, legislation that includes a public option.

Two big lobbying groups in the healthcare arena -- the American Medical Association (AMA) and AARP -- signaled their support for the Affordable Health Care for America Act (H.R. 3962). AMA is the largest physician association, while AARP is the hugely influential organization lobbying on behalf of U.S. senior citizens. The strength of these huge lobbying shops could well give the Democrats' reform plans added momentum in the face of fierce and united Republican opposition.

Although AARP has long supported healthcare reform principles, and conducted extensive advertising and awareness campaigns on behalf of healthcare reform, today's announcement is the first time the organization put its weight behind specific legislation.

"We started this debate more than two years ago with the twin goals of making coverage affordable to our younger members and protecting Medicare for seniors," says Jim Wordelman, state director for AARP in Idaho. "We've read the Affordable Health Care for America Act and we can say with confidence that it meets those goals with improved benefits for people in Medicare and needed health insurance market reforms to help ensure every American can purchase affordable health coverage."

Both AARP and AMA frame their support for the health reform measure as a pair with the Medicare Physician Payment Reform Act of 2009 (H.R. 3961) to reform the formula by which physician receive payment for services they perform for Medicare beneficiaries.

"The time to make health system reform a reality is now," says J. James Rohack, AMA president. "These two bills were introduced together, and they need to be passed together. Both are essential to achieving meaningful health system reform this year."

"On balance, H.R. 3962, The Affordable Health Care for America Act, is consistent with our principles of pluralism, freedom of choice, freedom of physician practice and universal access. It will significantly expand health insurance coverage to Americans to empower patient and physician decision making; institute meaningful insurance market reforms; make substantial investments in quality; institute prevention and wellness initiatives; provide incentives to states that adopt certificate of merit and/or early offer liability reforms, and reduce administrative burdens."

"H.R. 3962 is not the perfect bill, and we will continue to advocate for changes, but it goes a long way toward expanding access to high-quality affordable health coverage for all Americans, and it would make the system better for patients and physicians," Dr. Rohack says. "This is not the last step but the next step toward health system reform. We will remain actively engaged with patients, physicians, Congress and the administration to ensure that the final bill results in marked improvements to our health system."

The House healthcare reform package soon will go to a vote on the House floor, as will a Senate version put together by Senate Majority Leader Harry Reid (D-Nev.). Each version contains a different flavor of public, federally run health coverage option. If approved, the two versions of the legislation will be reconciled by a House-Senate conference committee, to create a final bill lawmakers would have to approve to send on to President Obama to be signed into law.

AARP's Wordelman adds: "We cannot continue to let insurers price older Americans out of the market, just as we cannot stand idle while millions of seniors are forced to choose between their groceries and their prescriptions. AARP is proud to endorse the Affordable Health Care for America Act and the Medicare Physician Payment Reform Act, and we urge members of the House to pass this critical package in the coming days to help fix our broken health care system."

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Stimulus for Cotton Candy, Tango and a Fish Orchestra? Wacky, or Actually Worthy?

2009-11-05T05:41:00.004-05:00

by Michael Grabell, ProPublica

Breakfast at Fuddruckers: $19.24.

Snow cone and cotton candy machine: $146.89.

Six extra preview performances of “Little House on the Prairie – the Musical”: $50,000.
Benefit to the economy? According to the recipients of this stimulus money: Priceless.

Last week, the federal government released the first comprehensive tally of the nearly $800 billion economic stimulus package. And while the White House has heralded marquee projects like road construction and solar panel factories, the stimulus package is also made up of hundreds of smaller purchases like office supplies, gasoline and lab rats.

Some of the more unusual purchases are bristling stimulus critics.

“This was not what people had in mind when they were talking about job creation,” said Leslie Paige, spokeswoman for Citizens Against Government Waste. “It was a gigantic pork barrel project from the first day out of the box, and it has proven itself to be every bit as swinish as we thought it would be.”

Waste, of course, is in the eye of the beholder.

Among the 150,000 stimulus expenditures released last week are dozens of iPods, toilets and trips to resort hotels. But, according to the reports, those seemingly questionable purchases are being used to enhance technology in the classroom, make bathrooms accessible to the disabled and train special education teachers.

“If you build a bridge to nowhere, that might be a bridge that you’re going to use that I’m not going to use,” said Ed Pound, spokesman for the government board charged with investigating waste and fraud in the stimulus package. “That’s not a call we’re going to make.”

The White House provided some insight on what types of projects don’t meet the administration’s standards when it announced last month that it had stopped and altered 170 proposals so far. On the list were projects to straighten headstones, freeze fish sperm and steam-clean bird droppings from buildings.

But when the stimulus oversight board released its report last week, other stimulus recipients had funded the exact same types of projects to reset headstones, freeze fish sperm and power-wash bird droppings from bridges.

The administration’s list last month of red-flagged projects included nine to renovate athletic facilities such as basketball and tennis courts. But last week’s report of projects going forward included at least six basketball courts and two tennis courts.

The White House said it shot down an Agriculture Department proposal to buy Taser stun guns for sheriff’s deputies. But law enforcement agencies around the country have used stimulus money to buy hundreds of Tasers.

“The point of posting all Recovery Act spending online was to enable the press and public to find potential dubious expenditures and call them to our attention,” Liz Oxhorn, the White House stimulus spokeswoman, said in an e-mail. “We will look at these projects to see if they meet our standards and are consistent with sound use of Recovery Act funds.”

The administration hasn’t explained why the 170 projects it flagged were troublesome and provided vague details about who even proposed them. Oxhorn said Wednesday that publishing the list was an effort to open up the decision-making process – not to expose waste.

The Electric Fish Orchestra

The award for most unusual stimulus project could perhaps go to Malcolm MacIver, a neurobiology and engineering professor at Northwestern University.

MacIver received a $1.25 million grant to use electric fish from the Amazon to study how animals take in sensory information to move quickly in any direction. (See video.) The research could help in the development of underwater robots to find the source of toxic leaks.

Further in the future, it could lead to new, far more agile prosthetics.

For public outreach – a component of most National Science Foundation grants – MacIver has proposed an interactive art exhibit. Sixteen species of electric fish will be arranged in sculpted fish tanks. The tanks will be connected to an amplifier that can convert the different frequencies that the fish emit into sound. Using a hacked controller from the Nintendo Wii video game system, visitors will be able to turn the amplifiers on and off, essentially conducting an orchestra.

The fish even have names that sound like rock bands: Black Ghost Knifefish, Glass Knifefish and Aba Aba.

MacIver said the innovative approach will be much more powerful and engaging than traditional outreach efforts, such as giving a lecture to a high school class.

“It’s a competitive necessity for our country to increase the level of science literacy,” he said. “To help crack the nut of disinterest in science, it helps to engage people with material which they can relate to and which they find interesting and fun.”

The Show Must Go On

Funding for the arts has always been a flashpoint in the debate over government spending. And the stimulus reports provide a sampling of the eclectic tastes of America’s arts community.

Thanks to the stimulus package, the Lincoln Center in New York City will be able to bring in jazz musician Pablo Aslan for a “tango salon.” According to the data released last week, the stimulus saved the jobs of three actors in Chicago Shakespeare Theater’s performance of “Richard III” and the designer of the Cezanne exhibit at the Montclair Art Museum in New Jersey.

Nearby at the Paper Mill Playhouse in Millburn, N.J., the city-owned theater was able to add six preview performances of “Little House on the Prairie – the Musical,” which starred an actress from the TV series, Melissa Gilbert. (She was TV’s Laura Ingalls). The stimulus money, along with a private donation, allowed the theater to pay for an additional week of the cast’s salaries and fine-tune the production based on the audience’s feedback.

Paper Mill’s executive director, Mark Jones, said the grant had an enormous economic effect. Many of the 4,000 to 5,000 people who saw the preview performances also went out to dinner, got their hair done and shopped, he said. The actors had extra spending money for rent and food.

“I think everybody’s taken a hit” in the recession, Jones told us. “Whether it’s a manufacturing job or an artist’s job or a teacher or a science researcher, they all add value to our cultural fabric.”

Cotton Candy for a Health Center

Last week’s stimulus reports are sometimes brimming with so much detail from construction firms that you could practically build the road yourself. Other times, they’re lacking even basic information.

For example, what does a $31 purchase at the Oriental Garden Chinese restaurant in Banks, Ore., have to do with providing a better education for children with disabilities?

“We kicked the year off with providing some in-service training,” said Shelley Mitchell, student services director for Banks School District 13, which received $107,000 for special education. “We bought some appetizers.”

The workshop for eight employees took place after school but before dinner and involved planning to help handicapped students transition into the adult world. The rural district about 25 miles outside Portland didn’t have enough space for the team meeting.

“It’s the only restaurant in town,” Mitchell said. “Well, we do have a Subway.”

Thousands of dollars in stimulus money has been spent on food. The breakfast at Fuddruckers was an expense for two officers of a Texas business attending a National Science Foundation meeting in Washington, D.C. Somebody else spent $5.74 at a Carl’s Jr.

Another purchase with scant detail comes from Northeastern Oklahoma Community Health Centers, which in June opened a new clinic in a low-income area where many workers don’t have insurance.

The item: “snow cone and cotton candy machine for open house picnic.”

According to Dr. Sharon Zang, the health centers’ chief executive, the machine was paid for with private donations. But it was listed in the stimulus report because the purchase was from the same bank account used for the stimulus grant.

The machine – along with hamburgers, hot dogs and balloons – was used to market the clinic and entertain children while their parents learned about the services available.

“We did tours through the clinic,” Zang said. “We told them about [our] sliding fee. We told them about Medicaid and Medicare. A lot of people don’t think they can get to a doctor because of their health insurance.”

Many of the people who attended the picnic have since come to the clinic for care, she said.
“The community has really supported this,” she said. “It’s really a wonderful story.”

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Cooperation Is the Key: Proposal for U.S.-China Collaboration on Climate Technology

2009-11-04T05:55:00.005-05:00

By John Podesta, Andrew Light, Julian L. Wong

The United Nations climate change summit in Copenhagen is less than 35 days away. Nations will negotiate a framework for a successor treaty to the Kyoto Protocol, which expires in 2012.

Any successful outcome at Copenhagen will require a commitment from the world’s major economies, not least of which are China and the United States, the two largest emitters of greenhouse gases and two largest consumers of energy. The Center for American Progress launches today a new report with the Asia Society, “A Roadmap for U.S.-China Collaboration on Carbon Capture and Sequestration,” which sets out a detailed plan for how these two countries can mutually benefit from working together to achieve greater emissions reductions than they can alone.

Recent history makes clear the importance of these two countries working together. The past decade of unprecedented economic expansion has helped China lift millions out of poverty, but not without consequence to its environment and emissions profile. The past eight years in the United States have been marked by the conspicuous absence of climate policy at the federal level and a lack of participation in any international climate agreement. Both countries are also representative of the antagonism that still dominates much of the current discussion over forging a new U.N. climate treaty. The U.S. Senate has previously expressed its opposition to joining any agreement that does not include major developing countries such as China; China has insisted that Western countries take responsibility for a problem that they caused and provide assistance for developing countries in the form of finance and technology to move them toward a low-carbon pathway.

Yet both countries have an unprecedented opportunity to move beyond this impasse. There has been a sea change in Chinese leadership on climate change during the past few years. China is now embarking on some of the world’s most aggressive energy efficiency, renewable energy, and forestry projects. The recent change in presidential leadership in the United States has heralded a fundamental shift in climate policy, with President Barack Obama laying the foundation for a domestic transition to a clean energy economy in his initial economic stimulus package. This was quickly followed by passage of the first comprehensive climate and energy legislation in the House of Representatives. Both countries have emerged as active and productive participants in the international negotiating process in the U.N. Framework Convention on Climate Change and leaders in smaller rounds of negotiations in the G-8, G-20, and Major Economies Forum.

A series of recent developments have raised the prospects of more concrete U.S.-China cooperation on climate change, including U.S. Energy Secretary Steven Chu’s visit to China that resulted in the announcement of a joint U.S.-China clean energy research center, declarations at the Major Economies Forum on Energy and Climate after the last G-8 summit in Italy in July, and a Memorandum of Understanding on energy and climate signed later in the month at the U.S.-China Strategic and Economic Dialogue in Washington, D.C.

President Obama is preparing to leave next week for the U.S.-China summit in Beijing, and the time has never been more ripe for the launch of a commitment between both countries to embark on a collaboration on clean energy that will not only benefit China and the United States, but also have a galvanizing effect for the rest of the world to move towards a successful outcome in Copenhagen.

The July Memorandum of Understanding from the Strategic and Economic Dialogue identifies 10 specific areas for cooperation between the United States and China on low-carbon technology and climate change, including energy efficiency, electric cars, and carbon capture and sequestration. General declarations of goodwill are a necessary step for cooperation, but the upcoming summit must put meat on these bones and focus on specific proposals for collaboration. Our aim in this new report is to provide just such a proposal for discussion and as the basis for action.

All of the areas for low-carbon and clean-energy cooperation identified in the July U.S.-China MOU must be pursued. Nothing in our report should be interpreted as suggesting that any one of these is more important than any other. There is a compelling argument, however, that neither country can achieve the emissions reductions it needs to make without addressing its heavy reliance on coal. For this reason, Secretary Chu issued on October 12 a “call to action” on CCS, advocating widespread, affordable deployment of this technology.

CCS is a process that separates and captures carbon dioxide from large point sources such as coal power plants and stores it away from the atmosphere by several means, including underground sequestration in geological formations. Our proposal for U.S.-China collaboration on CCS technology answers this call by helping to prove, or not, the feasibility of this technology as part of the solution to climate change.

We identify three areas of collaboration for the United States and China in the development of CCS technologies in the short, medium, and long-term, navigating potential political, technological, financial, and regulatory hurdles.

1. Cooperation on sequestration pure CO2 streams from existing Chinese
industrial plants. There are now approximately 100 facilities throughout China
producing pure streams of CO2 for various industrial purposes. This climate
pollution is vented unabated into the atmosphere where it contributes to global
warming. China also has a large documented geological storage capacity, consisting mostly of deep saline formations. A first step to mitigate these emissions can be to jointly fund five geological sequestration projects that can easily capture this source of carbon and store 2 million to 3 million tons of CO2 per year. Each project would cost $50 million to 100 million, with of the United States contributing $20 million
to 40 million. Together these sites could sequester 10 million to 15 million tons of CO2 per year, equivalent to taking 1.7 million to 2.5 million cars off the road.

2. Invest in research and development for retrofitting existing power plants. Much attention has been placed in both countries on producing a new generation of integrated coal-fired electricity plants which combine power production, capture of CO2 and sequestration. But both countries will have to maintain huge fleets of traditional plants in the short- to medium-term that will have to be retrofitted later for capture and sequestration. China and the United States should therefore develop a strategy for research, development and deployment of a series of pilot facilities for CCS retrofits for existing coal power plants under the auspices of the already planned U.S.-China joint clean energy research center.

3. Catalyze markets for CCS. China and the United States will have to mobilize private capital to fund the plants envisioned in step two by investing public funds and stimulating public-private partnerships. This focuses on developing financial incentives for companies to invest in cooperation initially through government-backed public finance structures that serve as a bridge to market mechanisms such as a carbon offset regime that includes proven CCS facilities and the creation of a global market for carbon abatement.

Cooperation in these three areas could accelerate CCS deployment in the United States by five to 10 years. This would deliver immense gains for U.S. job creation and consumer savings and more than compensate for American investment in this roadmap. Under a business-as-usual scenario, a proven CCS sector would create 127,000 jobs in the United States by 2022, including jobs in equipment manufacturing and infrastructure construction. A five-year acceleration of CCS deployment as a result of U.S.-China collaboration increases that figure to 430,000. A 10-year acceleration in deployment could create as many as 940,000 new U.S. jobs by 2022.

Collaboration will also quickly help lower the cost of CSS, and such savings will be passed along to electricity consumers. A five-year acceleration of CCS deployment in the United States would lead to $5 billion in savings, and a 10-year acceleration would lead to $18 billion in savings.

Cooperation between the United States and China on this roadmap would also serve as an example of a specific bilateral step that the two countries could take together on climate change for mutual benefit. Our hope is that the recommendations contained here have the potential to contribute to—in the words of Presidents Hu and Obama—a “positive, cooperative and comprehensive” Sino-American relationship for the 21st century. Such a relationship could become the cornerstone for a new era of greater cooperation between developed and developing countries overall on finding solutions to climate change by setting an example that could be emulated and duplicated many times over.

Report: A Roadmap for U.S.-China Collaboration on Carbon Capture and Sequestration (pdf) (Chinese version)

Fact sheet: Roadmap summary

This article was published by the Center for American Progress.

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Taxpayers Lose $2.3 Billion with CIT Bankruptcy

2009-11-03T20:42:00.002-05:00

by Paul Kiel, ProPublica

CIT filed for bankruptcy protection on Sunday, and part of its plan to heal itself is wiping out the taxpayers’ $2.33 billion stake in the company.

CIT, which specializes in lending to small and midsize businesses, got bailout money last December, a vote of confidence from regulators and the Treasury that CIT could survive and use the money to boost lending. But by the summer, the company was flirting with bankruptcy.

The Treasury’s investment was made in the form of preferred shares, as it was in almost all of the 600 other banks it approved for taxpayer investment through its TARP program for “healthy” banks. Preferred and common shareholders will be wiped out, the company has said.

The Treasury does stand a chance to recoup something. But that recovery “will be minimal” said a Treasury spokesperson.

CIT is not the only foundering TARP recipient. We reported a couple of weeks ago that three others were struggling to survive.

A little later in the week, we’ll post our monthly accounting for the bailouts to give you an overview of spending, how much has come back, and how much won’t.

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Marine Commandant Appears to Resist White House on Repeal Of Gay Ban

2009-11-02T21:24:00.005-05:00

Marine Corps Commandant General James Conway is opposing President Obama's pledge to repeal "don't ask, don't tell," the Washington Times is reporting today. Citing a former senior Pentagon official, the Times says that Conway "has emerged in internal Pentagon deliberations as the most outspoken opponent of permitting gay men and women to serve openly in the U.S. military."

According to the Times, the official "has been privy to private conversations on the matter," and says that "Conway has gone further than others in stating his opposition to a change in policy."

Military personnel currently serve under a policy of "Don't Ask, Don't Tell," which allows gays and lesbians to serve only if they don't disclose their sexual orientation. As a candidate last year, Obama promised to end the policy so as to allow members of the armed services to serve openly regardless of their sexuality. As president, Obama thus far has not acted to change the current policy, however.

Today, there are at least 65,000 gay Americans serving on active duty and 1 million gay veterans in the United States, according to one estimate. More than 13,500 service members have been fired under "Don't Ask, Don't Tell" since 1994.

The Times asked Conway to comment, and his spokesman, Major David Nevers, responded with the following statement: "Our Marines are currently engaged in two fights, and our focus should not be drawn away from those priorities. When the time is right, we have full confidence that we will be asked to provide the best military advice concerning the readiness of the Corps as it relates to this issue."

According to Aaron Belkin, director of a think that specializes in issues around gays in the military, Conway's apparent comments may foreshadow arguments that will be emphasized in congressional hearings, namely that wars in Iraq and Afghanistan preclude the military from focusing on repeal.

"It does appear that these comments are a warning shot to proponents, including the White House," says Belkin.

Others expressed concern that Conway's opposition could raise thorny questions of civilian control over the military. "The President has declared which way policy is heading," says Diane Mazur, a researcher and supporter of allowing gays to serve openly in the U.S. military. Mazur is professor of law at the University of Florida and an expert on civil-military relations.

"There is no faster way for a Commander-in-Chief to lose the respect of those serving under him than to allow his Service Chiefs to march in an opposite direction."

According to tired Air Force Colonel Dick Klass, similar issues emerged 16 years ago when President Bill Clinton tried to repeal the gay ban.

"Clinton's mistake was to call the Chiefs into the Oval Office and ask them what they thought about gays in the military," says Klass. "What Clinton should have done, and what Obama should do, is call the Chiefs in, explain that repealing the ban is a matter of national security, and tell them that if they are uncomfortable with that, they should resign."

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What Health Care Reform Means For: The Uninsured

2009-11-02T05:58:00.002-05:00

by Olga Pierce, ProPublica

Using results from a questionnaire we did with American Public Media’s Public Insight Network, we’re looking at how the proposed health care reforms will actually affect people facing common health care coverage situations. This is the first in a series.

Anne Johnson, 41

Location: Corona, Calif. Work Status: Unemployed Income: $0

Her story:

Anne Johnson lost coverage for herself and her 18-year-old son in February when she lost her job as a secretary at a solar energy company, where she was earning about $25,000 per year.

Shortly before she was laid off, a cardiologist told her she needs her aortic valve replaced, but without insurance she can’t afford the surgery. She is supposed to get checkups every six months, but that is also too expensive – so she has put them off. Her last visit to the cardiologist was in January, so she is already three months overdue.

“Right now I have no idea what type of condition I’m in,” Johnson said.

What health care reform would mean for her: Johnson’s son may already qualify for Medi-Cal, the state’s Medicaid program, which covers low-income children if they do not have private insurance, because her son is under age 21. (We let Johnson know that her son may be eligible.)

But if she gets a job that pays roughly the same as she earned before but does not provide health insurance, he would most likely lose his Medi-Cal coverage. The House reform plan, and the Senate Finance Committee plan would standardize Medicaid eligibility across states to 133 percent of the federal poverty line, which amounts to $19,378 for a family of two. The plan from the Senate Health, Education, Labor and Pensions Committee (known as the HELP committee) would expand it to 150 percent of the poverty line, still only $21,855.

Johnson would be able to purchase private health insurance from a gateway or exchange, a state-based pool offering a menu of private insurance plans. The House and the Senate HELP bills would also offer her a public plan.

Her low income would qualify her for a subsidy to help buy insurance through the exchange, according to all three reform proposals.

The House plan and the Senate Finance Committee plan would allow Johnson to choose from four levels of coverage ranging from basic to premium, while the Senate Health, Education, Labor and Pensions Committee does not specify levels of coverage.

But if Johnson remains uninsured, she will have to pay a hefty tax penalty: All three plans impose a highly controversial tax penalty on uninsured individuals. The HELP bill would impose a penalty of $750 per year per person, so Johnson would have to pay $1,500. The Senate Finance plan phases in a penalty of $750 per year per uninsured adult, so Johnson would pay the same amount since her son is 18. The House bill would fine families the cost of a basic health insurance plan from the health exchange, up to 2.5 percent of their taxable income.

Critics of the requirement that all individuals have health insurance say it would in effect increase taxes for poor and middle-class people for not being able to afford health insurance.

Anne Johnson shared her story in response to our “How (if at all) has the health care system failed you?” survey. The survey was created in collaboration with American Public Media’s Public Insight Journalism.

If you’d like to share your stories and experiences with ProPublica, join our Reporting Network.

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