The Note, 2/3/09: Soft Middle — Obama seeks to reset debate, but centrists control stimulus’ fate

By Caitlin Taylor

Feb 3, 2009 8:13am

By RICK KLEIN What two weeks of the Obama era have taught us: 1. The national debt would be smaller if President Obama’s Cabinet were larger. 2. Republican Party unity costs more or less $819 billion. 3. Barack Obama was serious about a diverse Cabinet.  4. Lobbyists aren’t welcome in the Obama administration — except when they are.  5. You can pretty much learn where the Senate is swaying by watching the middle — yes, still. Maybe this is post-partisanship at work — but somehow we feel like we’ve seen this play out before: Sixty is the new 80. The stimulus package — combined with Cabinet woes, and a few flexible pledges — have brought a presidency that seeks to soar down to solid ground. As Obama fans out to the networks — including a sit-down with ABC’s Charles Gibson, to air on “World News” Tuesday — he needs to re-set the terms of the stimulus debate. Team Obama lost the early battle to define the bill — which has become a pork-stuffed monstrosity, instead of economic salvation wrapped in legislation. That’s where Senate centrists come in. The loose coalition of lawmakers that are scrubbing the measure with an eye on offering joint amendments — being led by Sen. Ben Nelson, D-Neb., and Sen. Susan Collins, R-Maine — are quickly becoming the group to watch. They have the votes to exert their will, and that means sorting out spin from reality (or at least their take on it) on a measure that’s easy to hate for its scope, and maybe easier to mock for its specifics. ABC’s George Stephanopoulos: “President Obama isn’t going to get the 80 votes in the Senate that he originally wanted on the stimulus bill. The president is starting to agree to changes in the bill, taking out some of the more unpopular spending and increasing some tax credits.” “There’s a group of centrist Democrats and Republicans in the Senate who are working now on amendments that might increase infrastructure spending, do more for housing, and, perhaps, bring down the overall cost to the bill,” he adds.  “The fix is in,” write Roll Call’s Emily Pierce and Keith Koffler. “Stung by GOP — and even some Democratic — criticism of their so-called economic recovery behemoth, Senate Democrats and the White House are scrambling to repair the package so that it might appeal to Republicans and actually stimulate the economy before October 2010. But before it gets better, it’s likely to look a whole lot worse, as the Senate appears set to add tens of billions of dollars more to the already $888 billion measure this week.”  Out of necessity, taking on his own party: “Two Democratic sources with knowledge of the meeting [at the White House] said the president took a blunt tone with the lawmakers, urging them to drop whatever needs to be cut from the bill to gain bipartisan support and to pass Congress soon,” Michael D. Shear and Shailagh Murray report in The Washington Post. “One source said Obama appeared to be frustrated by the public perception that the recovery bill was becoming laden with partisan pet projects.” “Among [the changes] that the White House is willing to accept include doubling the homeowners tax credit, and adding more spending for infrastructure,” ABC’s Jake Tapper reported on “Good Morning America” Tuesday. It’s going to be a messy week: “Democrats and Republicans are seeking changes worth tens of billions of dollars to President Barack Obama’s economic-stimulus package as the U.S. Senate began debate yesterday on the plan,” Bloomberg’s Brian Faler writes. “Senate Budget Committee Chairman Kent Conrad, a North Dakota Democrat, said lawmakers from both parties are developing plans to redirect at least $50 billion to aid the ailing housing industry. Another Democrat, Ben Nelson of Nebraska, said he and other senators are preparing an amendment to cut ‘tens of billions’ of dollars in spending in the plan, saying they doubt it would do much to help the economy.”  “Republican support will be needed to get the 60 votes needed to waive budget points of order, and this will almost certainly require some give on tax cuts and dedicating a greater share of the money to traditional highway, transit and clean water projects,” Politico’s David Rogers writes. “In its haste to move a bill, the administration never made public its precise spending plan; this contributes to the uncertainty now.”  One battle that’s being lost: “A strong majority of Americans (75%) want Congress to pass some version of President Obama’s economic stimulus plan, but this group is split down the middle on whether it should be passed as is or with major changes,” per the Gallup Poll write-up.  Support for the plan as proposed is 38 percent — 28 points below Obama’s approval rating. And more than half of respondents either want major changes or an outright rejection of the plan.    Why Obama’s interviews Tuesday will be interesting: “Obama and the Democrats are losing the Washington-based word war about the economic stimulus package,” Andrew Malcolm writes at his Los Angeles Times blog. “So tonight through the network interviews, which will be replayed Wednesday morning, Obama will seek to re-set the focus on economic stimulus. Get the talk back on home turf. Stop playing D. The suggested talking points will arrive on his Oval Office desk this morning for presidential digestion.”  Part of the president’s play: “A divided and discontented Senate on Monday began debating a nearly $900 billion economic stimulus plan, while President Barack Obama launched a new grassroots campaign asking Americans to prod their lawmakers to act on it,” McClatchy’s David Lightman and Margaret Talev write. “The grassroots tactic resembles Obama’s presidential campaign efforts to keep supporters across America involved and energized, and is a novel extension of computer-based campaign tactics into governance.”  Good luck defending these (and is it possible to eliminate every talking point?): “Items Republicans want stripped from the measure include $25 million for all-terrain vehicle (ATV) trails, $20 million to remove fish passage barriers, $400 million for preventing sexually transmitted diseases, $34 million for remodeling the Commerce Department and $150 million for honey bee insurance,” the New York Daily News’ Michael McAuliff reports.  Already gone: “Senate Democrats have agreed to remove extra funding for anti-smoking programs as part of the stimulus bill that’s being debated this week, ceding to critics of the bill who argued that the money had nothing to do with job creation,” per ABC News. Watch the bottom line: “Florida citrus growers, California wine growers and a range of agricultural interests are pushing a tiny change that would allow farmers to more quickly depreciate new fields. High-tech and pharmaceutical companies want to save billions in taxes by including a plan that would allow them to bring overseas profits back home at lower tax rates. Labor unions are pressing Congress to make sure that new government funding for green technology results in jobs with good pay and benefits for workers,” Brody Mullins and Elizabeth Williamson write in The Wall Street Journal.  “Together, the competing lobbying efforts are likely to drive up the overall cost of the stimulus package that President Barack Obama and congressional Democrats hope to enact by the end of next week. The Senate version of the legislation, which Senate leaders hope to approve by week’s end, has already swelled to $885 billion, according to a new estimate released Monday by the nonpartisan Congressional Budget Office,” they write. Watch this (smart) game: “Seeking to drive a wedge between Democrats at either end of Pennsylvania Avenue, [Senate Minority Leader Mitch] McConnell called on Obama to pressure his party into accepting Republican proposals on the Senate floor,” The Hill’s Alexander Bolton writes. Democrats want you to see: “While the proposed economic stimulus package has become the target of partisan inside-the-Beltway bickering, freshman Democrats in the House are finding that the topic is getting a warm reception back home,” per National Journal’s Erin McPike.  Why there’s a clock: “The possibility that at least two of the nation’s biggest banks may be in danger of collapse could force the administration to ask Congress for another eye-popping bailout — running to at least hundreds of billions of dollars,” The Los Angeles Times’ Janet Hook and Maura Reynolds report. “Tactically, the White House wants to have the stimulus plan approved and out of the way before any such proposal is made. Given the widespread anger over Wall Street bonuses and what are seen as other excesses, proposing to shell out more tax dollars could trigger extreme sticker shock in both parties.”  Key to understanding the dynamics: Somewhere along the line, Obama lost some high ground. The Boston Globe’s Peter Canellos notices that the president’s calls for “responsibility” got quiet when it came to tax lapses by his nominee for Health and Human Services, Tom Daschle. “The cost to Obama could be considerable,” Canellos writes. “Already, the tax avoidance of his nominees is giving fuel to the late-night comedians who have struggled to develop a take on the new administration. And Obama, whose high-mindedness at times verges on aloofness, will inevitably be attacked for putting his own team’s sense of superiority — the belief that [Tim] Geithner and Daschle are so talented that they’re irreplaceable — ahead of the normal sense of accountability that would apply to people who fail to pay their taxes on time.”  “We have one Cabinet nominee who did not pay all of his taxes and another Cabinet pick already confirmed who did something similar — and a stimulus package that offers mountains of cash but only molehills of reform. Can we go back a bit?” Richard Cohen writes in his Washington Post column.  “Barack Obama promised a ‘clean break from business as usual’ in Washington. It hasn’t quite worked out that way,” the AP’s Charles Babington writes. “From the start, he made exceptions to his no-lobbyist rule. And now, embarrassing details about Cabinet-nominee Tom Daschle’s tax problems and big paychecks from special interest groups are raising new questions about the reach and sweep of the new president’s promised reforms.”  “The episode has already shown how, when faced with the perennial clash between campaign rhetoric and Washington reality, Mr. Obama has proved willing to compromise,” Peter Baker writes in The New York Times. “Every four or eight years a new president arrives in town, declares his determination to cleanse a dirty process and invariably winds up trying to reconcile the clear ideals of electioneering with the muddy business of governing. Mr. Obama on his first day in office imposed perhaps the toughest ethics rules of any president in modern times, and since then he and his advisers have been trying to explain why they do not cover this case or that case.” Said Daschle: “I would hope that my mistake could be viewed in the context of 30 years of public service.” “The failure by the former Senate majority leader to pay taxes on the free use of a car and driver for several years, first reported Friday by ABC News, complicates Daschle’s nomination and erodes the chances that it will sail through the Senate,” per ABC’s Karen Travers, Jonathan Karl, and Jake Tapper.  “The committee’s Democrats emerged from the meeting to give Mr. Daschle their effusive backing, providing his strongest boost since news of his tax problems emerged Friday,” The Wall Street Journal’s Naftali Bendavid, Laura Meckler and Glenn R. Simpson report. “The Republicans’ position is less clear, and none made definitive statements of support or opposition. Still, the Democrats, with 58 votes in the Senate, are tentatively optimistic, while the Republicans now have a week until Mr. Daschle’s hearing to decide what stand to take.”  “Republican aides said Senator Charles E. Grassley of Iowa, the senior Republican on the committee, continued to have questions that went beyond the taxes. In particular, they said Mr. Grassley was concerned about potential conflicts of interest, given the large amount of income Mr. Daschle received for speaking to health care companies and advising them,” The New York Times’ Carl Hulse and Robert Pear report.  And: “In another boost to Mr. Daschle, Senator Edward M. Kennedy, the ailing Massachusetts Democrat who is highly influential on health care policy, was making phone calls on Mr. Daschle’s behalf, officials said.” But: “Tom Daschle backed the patron who paid him a million-dollar salary and supplied him with a free car and driver for a job inside the Obama administration, two Democrats said Monday,” Politico’s Ben Smith and Eamon Javers report. “Leo Hindery, whose InterMedia Partners employed the former Senate Majority Leader, had been mentioned as a possible Secretary of Commerce or U.S. Trade Representative.” The New York Times editorializes: “We believe that Mr. Daschle ought to step aside and let the president choose a less-blemished successor. Mr. Daschle’s tax shortfall is particularly troubling because it comes on the heels of another nominee’s failure to pay taxes due. We were not pleased when the president’s Treasury secretary, Timothy Geithner, admitted that he had failed to pay tens of thousands of dollars in federal self-employment taxes while working for the International Monetary Fund despite having signed paperwork acknowledging the obligation. Now we are confronted with an even larger lapse by Mr. Daschle.”  Sen. Judd Gregg, R-N.H., gets the Commerce nod on Tuesday, with an 11 am ET announcement. (And make sure he paid taxes on that winning scratch-off ticket!) “Sources tell ABC News that late Tuesday morning in the White House’s Grand Foyer, President Obama will announce that he has tapped Sen. Judd Gregg, R-N.H., to be his Secretary of Commerce,” per ABC’s Jake Tapper. “Senate Democrats expect that Democratic Gov. John Lynch of New Hampshire will appoint a Republican to serve out the remainder of Sen. Gregg’s term, until 2010, and that Republican will almost certainly be J. Bonnie Newman.”  First questions for the new secretary-designate: “President Obama’s new candidate to run the Commerce Department voted in favor of abolishing the agency as a member of the Budget Committee and on the Senate floor in 1995,” CQ’s Jonathan Allen reports. “Sen. Judd Gregg , R-N.H., whose nomination was expected to be announced Tuesday, also worked in the Senate to trim the department’s budget as head of the Commerce-Justice-Science Appropriations Subcommittee.”  “Yesterday, Gregg and Gov. John Lynch commented publicly for the first time on the dramatic turn of events, making it clear that Democrat Lynch, with the blessing of the Obama administration and U.S. Senate Democratic and GOP leaders, is on board to name a Republican rather than a member of his own party when Gregg moves to the cabinet post,” John DiStaso writes in the New Hampshire Union-Leader.  “Fergus Cullen, former chairman of the state Republican Party, said he found the politics of the move bewildering, pointing out that the president and Gregg have very different political philosophies; that Obama could find plenty of other qualified people for the commerce job; and that Gregg could retire in two years if he is tired of his job. And, Cullen said, appointing a Republican could result in Lynch facing a primary challenge from a liberal Democrat in 2010,” Lisa Wangsness reports in The Boston Globe.  Maneuverings: “The Obama administration has tapped Ambassador Chris Hill, a career member of the Senior Foreign Service, to be Ambassador to Iraq,” ABC’s Martha Raddatz reports.  You didn’t think he’d miss a Lincoln event, did you? “Two years ago this month, on Feb. 10, 2007, then-Sen. Barack Obama announced his candidacy for president in Springfield, Ill., — not far from the Abraham Lincoln museum. Next week, on Feb 12., President Obama will return to Springfield to celebrate the 200th anniversary of Lincoln’s birth,” Mark Silva reports in the Chicago Tribune. “The White House says the president will travel at the invitation of Sen. Dick Durbin, the senior senator from Illinois who helped convince Obama to run for president.” The Kicker: “I am so grateful to him for a lifetime of all kinds of experiences.” Secretary of State Hillary Rodham Clinton, thanking her husband. Bookmark the link below to get The Note’s daily morning analysis: For up-to-the-minute political updates check out The Note’s blog . . . all day every day: Follow The Note blog on Twitter:

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