Elizabeth Warren responds to Crossroads ad: Sorry, not backing down
By Greg Sargent
It looks like both sides have now laid their bets in Massachusetts on the true signficance of Occupy Wall Street, on the direction of the public mood, and on what resurgent populism really will mean for the political atmosphere next year.
In an interview with WCVB-TV in Boston, Elizabeth Warren was asked to respond to the Rove-founded Crossroads GPS ad linking her to Occupy Wall Street. Though she disavowed violence, she directly aligned her candidacy and her own history of fighting Wall Street with the spirit and general critique driving the protests:
INTERVIEWER: Is it fair or not fair for them to link you so closely with Occupy Wall Street?
WARREN: It’s fair to say that I’ve been protesting Wall Street for years and years. I went to Washington in part to try to stop the bank bailout from giving away money, no strings attached. I’ve gone toe to toe with some of the CEOs of the largest Wall Street financial firms. I’ve even
INTERVIEWER: So these are your people?
WARREN: I’m glad to see lots of people start to really push on this issue. Let’s face it: Something’s badly broken in America right now. We’ve got a middle class that has been hammered financially for a generation. And we’ve got a Washington that works only for those who can hire an army of lobbyists and an army of lawyers. And that means it’s not working for the rest of us. So, yeah, I protest that. I’ve been worried about that. I’ve been working on that for a very long time.
INTERVIEWER: So their mission, their philosophy, their tactics, you all agree with?
WARREN: Let’s be clear. Everybody has to follow the law. There’s no exception on that. More important, though, this is an independent, organic movement. It’s its own voice. It will go in its own direction. We don’t speak with a unitary voice anywhere about what needs to be changed. There are lots of people, lots of voices — whether they’ve taken to the streets, whether they’re sitting at home saying, `this doesn’t work anymore.’ We need a lot of voices saying, we’ve got to have change. Because it’s clear: Washington’s not looking to change on its own. And Wall Street is going to keep pumping money into Washington, pumping it into elections, to make sure that their way is the dominant way in this country. I think that’s wrong.
The Republicans keep repeating these lies (NYC mayor Michael Bloomberg, shame on you, too) and the media--including the CNBC moderators, who surely know better--keep letting them get away with it. Thank you, New York Times, for setting the record straight. More fact checking at link below, as well. Emphasis mine.
November 9, 2011, 11:08 PM
Michigan Debate Fact Check
By THE NEW YORK TIMES
Regulation and Housing Crisis
There is a basic problem with the argument, made by several candidates, that the government forced mortgage lenders to make bad loans: most subprime loans were made by companies that were not subject to any kind of federal regulation.
Furthermore, there was no need for force. Financial companies jumped into the market. The major investment banks lined up to purchase subprime lenders, the major retail banks created subprime-lending divisions and a generation of upstart subprime lenders like Ameriquest and Countrywide were briefly celebrated as rising stars of American business.
No executive of a major mortgage company said at the time that the government was forcing him to make subprime loans. The executives said they did it because they thought they’d make money. And even now, after the crash, with all the temptation to point figures, it is awfully hard to find a mortgage executive who echoes the argument of the Republican candidates.
Studies of the financial crisis do assign a significant measure of responsibility to the government, but mostly for its failure to regulate these lenders.
Fannie Mae and Freddie Mac, the government-backed mortgage finance companies, did provide financing for large numbers of subprime loans, mostly by purchasing mortgage securities for their investment portfolios. But the historical record shows that they came late, diving into subprime lending because private companies were stealing their business and profits. As such, most experts have concluded that Fannie and Freddie helped expand the bubble but did not create it.
- Binyamin Appelbaum
The moderators for the Bloomberg debate last night sat there and let Michele Bachmann and then New Gingrich spew their 'Fannie and Freddie' lies while also blaming the Community Reinvestment Act for the housing crisis. Both not true. And, now Joe Scarborough is repeating the lie this morning--saying that Barnie Frank and Christopher Dodd deserve blame for the housing crisis. They had just played the Gingrich clip from last night's debate saying the two should go to jail. Totally absurd. (Emphasis mine)
Sun, Oct. 12, 2008
Private sector loans, not Fannie or Freddie, triggered crisis
David Goldstein and Kevin G. Hall
last updated: November 24, 2010 01:49:33 PM
Commentators say that's what triggered the stock market meltdown and the freeze on credit. They've specifically targeted the mortgage finance giants Fannie Mae and Freddie Mac, which the federal government seized on Sept. 6, contending that lending to poor and minority Americans caused Fannie's and Freddie's financial problems.
Federal housing data reveal that the charges aren't true, and that the private sector, not the government or government-backed companies, was behind the soaring subprime lending at the core of the crisis.
Conservative critics also blame the subprime lending mess on the Community Reinvestment Act, a 31-year-old law aimed at freeing credit for underserved neighborhoods.
Congress created the CRA in 1977 to reverse years of redlining and other restrictive banking practices that locked the poor, and especially minorities, out of homeownership and the tax breaks and wealth creation it affords. The CRA requires federally regulated and insured financial institutions to show that they're lending and investing in their communities.
Conservative columnist Charles Krauthammer wrote recently that while the goal of the CRA was admirable, "it led to tremendous pressure on Fannie Mae and Freddie Mac — who in turn pressured banks and other lenders — to extend mortgages to people who were borrowing over their heads. That's called subprime lending. It lies at the root of our current calamity."
Fannie and Freddie, however, didn't pressure lenders to sell them more loans; they struggled to keep pace with their private sector competitors. In fact, their regulator, the Office of Federal Housing Enterprise Oversight, imposed new restrictions in 2006 that led to Fannie and Freddie losing even more market share in the booming subprime market.
refinance their homes, even if they are somewhat under water.'
Tim Geithner today in a hearing before the House of Representatives. C-Span3 video below. This response can be found at 1 hour, 29 minutes into the video.
Greg Sargent's Morning Plumline:
* Fact check of the day: CNN takes apart the ubiquitous GOP claim that tax hikes on the rich would be damaging to small businesses and the nation’s “job creators”:
In sharp contrast to the rhetoric, current data suggests small businesses don’t create an outsized number of jobs, very few small business owners fall into the top two tax brackets, and tax cuts for small businesses are ineffective stimulus measures.
Relatively few small businesses would be affected: Extending the tax cuts for top earners for another decade would come at a significant cost — nearly $1 trillion in added debt over a decade. But small businesses wouldn’t see much of that cash. Only 2.5% to 3.5% of small businesses would be affected by an increase in those two rates.
September 23, 2011
The Phony Solyndra Scandal
By JOE NOCERA
If Brian Harrison and W. G. Stover, the two Solyndra executives who took the Fifth Amendment at a Congressional hearing on Friday, ever spend a day in jail, I’ll stand on my head in Times Square.
It’s not going to happen, for one simple reason: neither they, nor anyone else connected with Solyndra, have done anything remotely criminal. The company’s recent bankruptcy — which the Republicans are now rabidly “investigating” because Solyndra had the misfortune to receive a $535 million federally guaranteed loan from the Obama administration — was largely brought on by a stunning collapse in the price of solar panels over the past year or so.
The company’s innovative solar panels, high-priced to begin with, became increasingly uncompetitive in the marketplace. Solyndra didn’t have enough big commercial customers to create the necessary economies of scale. And although Harrison and Stover remained optimistic up to the bitter end — insisting six weeks before the late-August bankruptcy filing that the company was going to be fine — they ultimately failed to raise additional capital that would have allowed Solyndra to stay in business.
The Republicans are trying to make that optimism appear sinister, but if we’ve learned anything from the financial crisis, it is that wishful thinking in the face of a collapsing market is not a crime. Otherwise, Richard Fuld, the former chief executive of Lehman Brothers, would be wearing prison garb.
Is the EPA regulating ozone after all?
Posted by Brad Plumer at 04:56 PM ET, 09/23/2011
Remember in early September, when there was that big uproar over the fact that the White House was scrapping standards for ground-level ozone pollution (or smog)? That raised a question: What happens next? After all, the last time the ozone standard was updated was back in 1997, when it was set at 84 parts per billion. The Bush administration tried to lower the legal limit to 75 parts per billion, but that rule was attacked in court and dubbed “legally indefensible” by current EPA head Lisa Jackson. So does the agency go back to the Bush rule or leave the 1997 standard in place?
Turns out, the EPA is going with those “legally indefensible” rules. Gina McCarthy, the agency’s top air-quality official, has issued a memo telling state and local regulators that the EPA is moving forward with the Bush-era ozone standard, albeit cautiously, to “reduce uncertainty and minimize the regulatory burdens on state and local governments.” Keep in mind that the rule that got scotched by the Obama White House would’ve set the standard at 70 parts per billion. So, in practice, we’re talking about a difference of 5 parts per billion (which, to be sure, many public-health experts deem significant).
But wait, won’t this Bush rule still cost money? Remember, the ozone standard that just got scrapped would’ve cost industry between $11 billion and $31 billion per year. White House chief of staff William Daley was reportedly nervous about the impact that it could have on industries in swing states. Yet the Bush rule is estimated to cost about $8 billion per year. Shouldn’t the White House also be dreading that (assuming, of course, that this rule doesn’t get thrown out in court)?
Perhaps, but two caveats. For one, EPA appears to be going slow with the new ozone rule, per McCarthy’s memo. And second, as the Center for Public Integrity’s Corbin Hiar reports, there isn’t necessarily a tight overlap between swing districts in the 2012 election and districts likely to be in non-attainment of the ozone rule: “There were some districts in the swing state of Florida that could have run afoul of the tighter standards. But the proposed standard also would have forced changes in many Massachusetts congressional districts where Obama has strong political support.”
Here’s a fuller map of counties likely to be affected by the Bush-era ozone rules.
Note to the NYT: The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, signed by President Obama on 12/17/10, changed the estate tax thresholds to $5 million for individuals and $10 million for joint filers beginning in 2011 with a top tax of 35% for 2011 and 2012. President Obama wants to return the estate tax to the rates in effect at the end of 2009--$3.5 and $7 million thresholds.
Note to the Dems: Read and repeat the small business income facts below. Don't let the Republicans keep repeating their 'small business' lies! Call them out!
HIGHER TAXES FOR THE RICH
The Obama plan would allow the Bush tax cuts for the wealthiest Americans — individuals earning more than $200,000 a year and households earning more than $250,000 — to expire at the end of 2012. That would restore the top two marginal tax rates to 36 percent and 39.6 percent, up from 33 percent and 35 percent today. It would also restore the estate tax, which vanished completely in 2010, and raise the capital gains tax on wealthy individuals from 15 percent to 20 percent.
The full Bush-era tax cuts were the single biggest contributor to the deficit over the past decade, reducing revenues by about $1.8 trillion between 2002 and 2009. The White House estimates that Mr. Obama’s plan would raise $866 billion over the next decade, or nearly half of that.
As for the supposed job-killing effects, President Bill Clinton raised tax rates to where Mr. Obama wants to restore them now, and the economy grew faster and added many more jobs during those eight years than it did after President George W. Bush slashed taxes across the board.
Republicans are undaunted. Their main claim — delivered in a conveniently populist tone — is that the higher rates will penalize small businesses that file as individuals. Small businesses are undeniably major engines of job creation. But only about 2.5 percent of all small-business owners (and 4 percent of those reporting positive income) earn enough to be taxed at the top two rates, according to the Treasury’s Office of Tax Analysis. Even more important, the argument ignores the fact that the higher income tax rate would apply to business profits, not revenues. Small businesses would still be able to deduct or amortize payrolls and investments.
They link to the CPBB article I posted earlier today.
September 19, 2011
A Call for Fairness
This time, President Obama did not compromise with himself beforehand, or put out a half measure in hopes of luring nonexistent Republican support. This time, he issued an unabashed call for economic fairness in cutting the federal deficit, asking as much from those on the economy’s upper rungs as from those lower down whose programs may be trimmed.
And this time, standing in the Rose Garden on Monday, he seemed to speak directly to a public that has been parched for farsighted leadership in Washington. The one troubling note of the day was Mr. Obama’s failure to provide enough specifics on some of his proposals, and his aides’ inexplicable continued faith in the idea of Congress working out a sensible middle ground on taxes.
But the president’s plan to cut $3.6 trillion from the deficit over the next 10 years is a well-proportioned mix. It proposes about 60 percent spending cuts (including winding down two wars that his predecessor started fighting off the books with the eager support of the supposedly fiscally responsible Republicans in Congress) and 40 percent tax increases on the wealthy and corporations.
It pays for the desperately needed jobs plan he sent to Congress last week without more mindless hacking at government programs, and would be a much better alternative to the $1.2 trillion in across-the-board spending cuts that loom if Congress does not pass a debt plan this year.
Republicans will, of course, mount obdurate opposition in Congress, since they have no intention of allowing the government to ask anything from the wealthy and corporations. Even before the plan was announced, the party’s leaders had rolled out their rusted artillery, calling an increase in taxes on high earners “class warfare” and insisting that it would fatally wound “job creators.” (In fact, less than 2 percent of the nation’s small businesses would be affected by the tax increases.)
Supporters of various tax benefits for high- income households often claim that failure to maintain them would have an undue effect on many small businesses. But even assuming a broad definition of “small business,” such claims are often exaggerated or false.
First, critics charge that allowing the 2001 tax cut’s reduction in the top two marginal income tax rates for individual taxpayers to expire as scheduled would affect a large proportion of small-business owners. In fact, only 1.9 percent of filers with any small-business income are projected to face either of the top two income tax rates in 2009. By contrast, more than 14 percent of filers with small-business income claim the Earned Income Tax Credit (EITC) for low-income workers. Thus, strengthening the EITC could help more than seven times as many small businesses as reducing the top income tax rates.
If making millionaires, billionaires pay their fair share is class warfare, guess who's won the war?
Hint: They are represented in the top right square in the big block--the top 1% to the top 1/100th of one per cent--.01%.
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