Morning Must Reads — Tripping up on Capitol Hill

Boston Herald — Hush comes to shove

Columnist Michael Graham looks at the debacle that was Martha Coakley’s Washington health-industry lobbyist fundraiser on Tuesday night.

He argues that for a campaign that can’t shoot straight (spelling Coakley’s state “Massachusettes” in an ad, saying in a debate there were not terrorists in Afghanistan, etc.) – the event (first reported by Examiner colleague Tim Carney) crystallized a lot of what Bay Staters don’t like about the candidate.

The event got extra attention in Boston because part of Coakley’s entourage shoved The Weekly Standard’s John McCormack into a rail. To tell the tale in Boston, reporters had to explain where she was (schmoozing with health industry lobbyists) and what question she was running from (whether she still thought Afghanistan was free from terrorists after recent bombings.)

Shoving McCormack made irresistible video and pictures for TV and Web sites, and Graham thinks what’s said setting up the shot may turn the tide for fed up Massachusettes and Massachusers.

“All the guy did was ask a question and the Coakley campaign pushed him to the curb. How many Massachusetts voters watched that video and thought ‘Pal, I know just how you feel’?

Coakley may not realize it, but we’re tired of being pushed around. Tuesday is our chance to push back.”


Los Angeles Times — Tax expansion could pay for healthcare overhaul

Washington’s attack on capital investment has come to the health discussion as Democrats make their final push on a health bill.

Meeting for six hours with President Obama at the White House (which you didn’t see on C-SPAN) congressional Democrats tried to hammer out a deal that could pass both houses swiftly. With fears that the Massachusetts Senate race could deliver them an unhappy surprise he president and his party are plunging into the work of passing a plan right away.

A sticking point has been that the Senate plan is partially funded through a tax on high-end health insurance, including many union policies, including government workers’. The House wants a special “millionaires’ tax” that Senators worry will hit small businesses and do nothing to discourage expensive health plans.

Writers Janet Hook and Noam Levey tell us that one solution seriously discussed at the meeting with President Obama was to exempt union policies from the plan and repace the lost revenue by applying Medicare payroll taxes to investment income.

A bill that punishes senior citizens already would take another swipe at anyone living off dividends or annuities. Plus, disincentives to investments in a sluggish economy seem like a daft thought.

That Democrats would even include such a wild idea at this point suggests that things are getting a little loose in the turns as Democrats try to get into the home stretch.

“Under current law, the top rate on capital gains and dividend income is 15%. That is scheduled to rise to 20% in 2011 if the George W. Bush-era tax cuts are allowed to expire.”


Washington Post — Obama administration seeks tax hike on financial firms to recoup cost of bailout

Writer Binyamin Appelbaum has learned that the financial industry tax to be proposed by the Obama administration today will take the form of a special penalty on inter-bank borrowing: loans taken by financial firms to make investments without disrupting their main holdings.

The “Financial Crisis Responsibility Fee” would apply to the 50 largest financial institutions, including those owned by the government, and is designed to rake in the $90 billion estimated cost of the financial bailout, and then some.

The goal is to prevent another financial crisis by discouraging investments and big profits on Wall Street. The proposal does not address that improvidently arranged government policies for backing bad mortgages at Fannie Mae and Freddie Mac made the crisis possible.

“The president's proposal will be included in the draft budget delivered to Congress in early February. What emerges from Congress, however, could be markedly different. Some members of both chambers are calling for a more punitive tax. Proposals range from a 75 percent levy on bonuses to a toll on financial transactions.”


Dana Milbank — 'Sorry' still seems to be the hardest word on Wall Street

Lloyd Blankfein seems like the kind of guy who accepts the loathing of others like a military decoration. If that’s so, he wears more medals than General Petraeus.

Testifying before the Financial Crisis Inquiry Commission Wednesday, the Goldman Sachs CEO sneered his way through the session.

Milbank rings his bell for refusing to accept any responsibility for incinerating the financial system by selling souped-up investments to customers while simultaneously placing big bets that those investments would crash and burn.

What sticks out most to me about Bully Blankfein’s testimony, though, is his inability to admit that he’s no capitalist swashbuckler, but a mooch who relies on friends in government to survive.

“When Wall Street collapsed 16 months ago, Goldman benefited from multiple forms of government bailouts: $10 billion in TARP money from the Treasury, billions more in payments to Goldman as part of the AIG bailout, and much more in the form of federal government lending programs. Regulators also allowed Goldman to convert itself into a bank holding company, an extension of federal backing that let the firm avoid the fate of Lehman Brothers. Without the federal government propping up Wall Street, Goldman, like most firms, probably would have failed.”


Bloomberg — Haiti Rescuers Race to Find People Buried in Rubble

Writers Peter Green and Bill Faries provide a clear, useful overview of post-earthquake Haiti, with a good picture of how the surges of relief pouring in from the U.S. and elsewhere are being frustrated by the weak infrastructure of the nation.

While we don’t know the death toll now, it is increasing by the moment as those trapped in rubble expire and could reach six figures. With the New York Times and others calling for a long-term commitment to stabilizing Haiti after the relief effort, the task ahead could be enormous for America.

“Haiti’s population of 9.6 million has a per capita income of about $560, with 54 percent of Haitians living on less than $1 a day and 78 percent on less than $2 daily, according to the World Bank. The gross domestic product was $7 billion in 2008. The country is still recovering from four tropical storms or hurricanes that killed at least 800 people in 2008.”

–My column on a health bill designed to fail is here.

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