Last Call

The Democrats are saying that the health care legislation they will soon propose will have a public health care plan option in it.

The top Democrat on the Senate Finance Committee — a moderate who is seen as the leading figure on Congressional proposals to create a national healthcare mandate — says that his bill is almost certain to include a public healthcare option, in a blow to the managed care industry and a possible major victory for progressives.

“I think a bill that passes the Senate will have some version of a public option,” said Montana Sen. Max Baucus, the Senate Finance Chairman. His remarks come two days after President Barack Obama signaled in a letter that a public competitor to the private health insurance companies was a key part of his agenda.

Of course, the measure will still have to pass the full Senate. Republicans are vehemently opposed to a public healthcare plan, saying it will interfere with the markets and handicap existing private insurance companies.

“Despite the happy talk from the four Senators about progress and compromise, Baucus’ concession that a government-run, public insurance option will likely be included in the reform bill could sink its bipartisan support,” Roll Call’s David Drucker wrote late Thursday. “Additional items are also making compromise difficult, including the issues of government mandates and how to pay for it.”

“Our caucus is very much against [a public plan.] It’s kind of a litmus test,” ranking Senate Finance Committee Republican Chuck Grassley (R-IA) said. “That’s all you can say. There’s no follow-up question that you can ask me. There’s no further statement I can make about it.”

The creation of a public healthcare option could revolutionize health care in America.

The real fight is on. There are enough health care groups and Republicans out there to sink this. The GOP knows if this passes, they are done. They will do everything they can to stop it. Likewise, if Obama has to shelve this, the Democrats are in deep trouble.

We'll see if the Democrats and Obama are willing to do what it takes to pass this.

Zandar's Thought Of The Day

When did Liz Cheney become Our Lady Of Regurgitating GOP Talking Points, anyhow?

Extraordinary

Obama's speech in Cairo was nothing short of breathtaking, and on top of that it was politically brilliant. His message boiled down to "We're ready to talk, but you must be ready to listen."

But Atlantic's Jeffrey Goldberg sums it up the best:

An African-American President with Muslim roots stands before the Muslim world and defends the right of Jews to a nation of their own in their ancestral homeland, and then denounces in vociferous terms the evil of Holocaust denial, and right-wing Israelis go forth and complain that the President is unsympathetic to the housing needs of settlers. Incredible, just incredible.

Of course. Obama is the enemy, don't you know.

You thought the Winger hate was bad before. We've gone straight to unhinged. I honestly am worried about the man's safety now. The next year or so will test us like never before, people.

Pray we pass.

RIP Geithner Plan

Since I explained last week how the banks didn't need the Geithner Plan in order to keep up the illusion of solvency, it appears this week that the Geithner Plan is now quietly being shelved.

The Federal Deposit Insurance Corporation indefinitely postponed a central element of the Obama administration’s bank rescue plan on Wednesday, acknowledging that it could not persuade enough banks to sell off their bad assets.

In a move that confirmed the suspicions of many analysts, the agency called off plans to start a $1 billion pilot program this month that was intended to help banks clean up their balance sheets and eventually sell off hundreds of billions of dollars worth of troubled mortgages and other loans.

Many banks have refused to sell their loans, in part because doing so would force them to mark down the value of those loans and book big losses. Even though the government was prepared to prop up prices by offering cheap financing to investors, the prices that banks were demanding have remained far higher than the prices that investors were willing to pay.

In a statement, the F.D.I.C. acknowledged that it had not been able to get banks interested in its so-called Legacy Loans Program. Scheduled to start later this month, the pilot program was aimed at selling off $1 billion in troubled home mortgages.

F.D.I.C. officials portrayed the change as a sign that banks were returning to health on their own.

That's funny, because the FDIC clearly went to all this trouble to make the banks look solvent. The issue was that the real measures the Fed and FDIC took to prop up the banks (AIG counterparty loans) worked too well. Now the banks want nothing to do with the government anymore other than to keep feeding them money under the table while they pretend the recession is over.

We're suddenly supposed to believe that the banks are so magically solvent now they went from needing a trillion dollars more in loans to not needing a dime?

And to boot, those toxic assets are still on the books of the banks. We were told this program was critical to the economy, a trillion dollars worth of critical. Now, it's no longer needed. The banks are suddenly fine!

And they'll continue to be fine right before the next wave of the recession crashes down upon their heads and ours, too.

Do you believe our banks are solvent?

You're already betting your livelihood on it.

I called this back in February. I said that the no right price problem would kill any program like this. I was correct in saying the Fed, Treasury, and the FDIC were wasting America's time and money with it.

Surprise, surprise. And now we're back to pretending everything's fine again.

[UPDATE] Much more on this from Baseline, Naked Cap, Calc Risk, and Ezra Klein.

Metagaming The Village

E.J. Dionne of Der Village has apparently come to the conclusion that even in the Age of Obama (or strictly because of that) the Republicans run the media.

A media environment that tilts to the right is obscuring what President Obama stands for and closing off political options that should be part of the public discussion.

Yes, you read that correctly: If you doubt that there is a conservative inclination in the media, consider which arguments you hear regularly and which you don't. When Rush Limbaugh sneezes or Newt Gingrich tweets, their views ricochet from the Internet to cable television and into the traditional media. It is remarkable how successful they are in setting what passes for the news agenda.

The power of the Limbaugh-Gingrich axis means that Obama is regularly cast as somewhere on the far left end of a truncated political spectrum. He's the guy who nominates a "racist" to the Supreme Court (though Gingrich retreated from the word yesterday), wants to weaken America's defenses against terrorism and is proposing a massive government takeover of the private economy. Steve Forbes, writing for his magazine, recently went so far as to compare Obama's economic policies to those of Juan Peron's Argentina.

Democrats are complicit in building up Gingrich and Limbaugh as the main spokesmen for the Republican Party, since Obama polls so much better than either of them. But the media play an independent role by regularly treating far-right views as mainstream positions and by largely ignoring critiques of Obama that come from elected officials on the left.

This was brought home at this week's annual conference of the Campaign for America's Future, a progressive group that supports Obama but worries about how close his economic advisers are to Wall Street, how long our troops will have to stay in Afghanistan and how much he will be willing to compromise to secure health-care reform.

In other words, they see Obama not as the parody created by the far right but as he actually is: a politician with progressive values but moderate instincts who has hewed to the middle of the road in dealing with the economic crisis, health care, Guantanamo and the war in Afghanistan.

Well gosh, it's almost like some of us called that a while back there E.J. my friend.

Still, he has a point. It's good to start seeing journalists actually question the practice of stenography of Republicans. Only took them what, 16 years?

Rush Limbaugh Fails At Reverse Psychology

So, Rush Limbaugh is willing to support the "racist" Sotomayor if she turns out to be a reliable pro-life vote based on her Catholic upbringing. Rush is expecting her backers to suddenly pull their support and say "But what if she overturns Roe v. Wade?!?" and try to scuttle her nomination, saving him some work.

It's about as transparent as air, and the White House has already come out to say that line of questioning her is full of crap. But I guess Rush is now expecting everyone on Sotomayor's side to panic or overreact. "If Rush likes her she's secretly a conservative!"

People aren't that stupid, are they? (The again, Limbaugh has a hell of an audience.)

If It's Thursday...

...for once, NOT a new record in continuing unemployment claims.

The number of U.S. workers filing new claims for jobless benefits fell for a third straight week last week, government data showed on Thursday, indicating some loss of force in the pace of the labor market's deterioration.

Initial claims for state unemployment insurance benefits fell 4,000 to a seasonally adjusted 621,000 in the week ended May 30, the Labor Department said. The week covered the Memorial Day holiday, which could have had an impact on the data.

Analysts polled by Reuters had forecast new claims slipping to 620,000 from a previously reported count of 623,000.

The number of people staying on the benefit rolls after collecting an initial week of aid fell 15,000 to 6.74 million in the week ended May 23, the latest week for which the data is available.

Still, as long as we remain over 600k new jobless claims each week, we're still in deep. Unemployment is powering a new wave of foreclosures and will continue to dampen growth. Tomorrow we'll see the monthly numbers, and I just don't see any sort of major recovery in the cards.

Welcome to the new normal.

Playing It Smart On Oil

Buying a supertanker's worth of crude oil at $35 a barrel (after all, lots of idle supertankers just floating around in this global recession) and storing it until prices double is smart. Buying at $70 a barrel in anticipation that prices will continue to rise is just telling you something.

The giant US bank JPMorgan Chase has reportedly hired a newly-built supertanker to store heating oil off the Mediterranean island of Malta. Other companies, including BP and a unit of Citigroup, have also hired ships to store either crude oil or oil products.

According to Bloomberg.com, “Traders were already using smaller tankers to store record volumes of jet fuel and heating oil in Europe as on-shore tanks filled up.”

This latest move comes amid suggestions that recent increases in oil prices may be the result of speculators looking for a new financial bubble, prompting fears that increases in energy costs could stall any hope of an economic recovery.

According to MSNBC, “Even though most analysts say crude is still overpriced, the market has created its own momentum with an enormous amount of money fleeing equity and currency markets. … With so much money flowing into the market, prices are likely to hold close to where they are, until market fundamentals can take hold.”

It has recently been suggested, however, that “prices will fall substantially” once speculators run out of storage.

The practice of storing oil on ships began last winter, when the price went as low as $32 a barrel. Bloomberg reported in January that the world’s biggest owner of supertankers, Frontline Ltd., had already hired out about 20 supertankers for oil storage and had requests for up to 10 more. “I’ve never before seen storage demand on this scale,” a shipbroker told Bloomberg.

It's like financial oil speculators expect oil to go back to triple digits or something. Gosh, I wonder what that will do to the economy should Americans find themselves paying $3-$4 a gallon for gas.

Again.

Long, Hot Summer

Yesterday's Quinnipiac poll showing 55% of Americans are against affirmative action is one thing. Conservatives are arguing that Obama's election is the final signal that the Civil Rights Act is no longer needed, and that the President should be the one to dismantle it or face a major backlash from voters.

I agree that one day, that will have to be done.

That day is not here yet.

Sadly, we're nowhere close. And if Republicans continue to insist that efforts to correct existing racism (and sexism for that matter) and themselves racist and sexist, they will continue to lose.

StupidiNews!

• Wal-Mart says it will add 22,000 employees by the end of the year.
• A federal judge has dismissed warrantless wiretap suits against the government.
• President Obama laid out his vision of peace with the Muslim word in Cairo.
• UK Prime Minister Gordon Brown is trying to fend off calls for his resignation as his government continues to be rocked by scandal.
• The Cassini space probe mission to Jupiter has discovered evidence of seasonal changes on Titan.