Wall Street Journal — Single-Regulator Plan for Banks Now Close
The Obama administration has more rocks for Congress to break this year, as a plan for a highly-centralized, more powerful financial regulatory agency takes shape.
It would amount to the biggest regulatory overhaul since the New Deal – possibly bigger – and would be aimed at ironing out risk and eliminating bubbles. Writer Damian Paletta explains that insurance companies, investment firms, hedge funds and others are all going to get a taste, but up first it’s banking.
“The new bank regulatory agency could prove controversial because it would consolidate the Office of the Comptroller of the Currency and the Office of Thrift Supervision and strip supervisory powers from the Federal Reserve and the Federal Deposit Insurance Corp.
The Fed and the FDIC would gain other powers, though, as White House officials want the Fed to be able to oversee systemic risks in the economy. They also want the FDIC to have new powers to take large financial companies that aren’t banks into receivership.”
New York Times – Sotomayor Pick a Product of Lessons From Past Battles
Amid the Times’ second day of wall-to-wall coverage of the Judge Sonia Sotomayor, there is one story worth reading – the rest being devoted either to how Republicans should be ashamed of themselves for wanting to know the judge’s positions or a study of her deep moderation.
Writers Adam Nagourney and Peter Baker got access to the minutae of how the nomination process worked. It’s a fascinating insight into how the Obama White House works. Sotomayor seems to have been the pick from almost immediately after the election, but a combination of Rahm Emanuel’s secrecy and the President’s intellectual gymnastics kept the process grinding on until the last minute.
“Impressed by Judge Sotomayor, Mr. Obama gathered his team around noon Monday in the dining room off the Oval Office. “I’m almost there,” he said as he ate a salad, one participant recalled. “I think it’s going to be her.”
By 9 p.m., he had called to offer her the job.
‘He ended up where we started out,’ [Greg] Craig said. ‘After all the work, he was thinking about Sonia Sotomayor at the beginning and he was thinking about her at the end. She withstood four months, five months of intense scrutiny by the White House counsel’s office and third parties.’”
St. Petersburg Times — Gov. Crist signs $66.5 billion budget, breaks tax pledge
Just two weeks after he signed a “no new taxes” pledge, Florida’s governor signed a budget that slapped new taxes and fees on cigarettes, driving licenses, motor vehicle tags, using the court system, visiting state parks and fishing from beaches and bridges.
Neither did Crist use the broad powers ascribed to his office to use line item vetoes to cut spending as Gov. Tim Pawlenty did in Minnesota.
Crist argued that at least he didn’t have to do what his fellow pro-stimulus Republican Arnold Schwarzenegger did and start emptying prisons or firing thousands of state workers to plug Florida’s $6 billion budget gap.
It will still cause Crist huge problems in the upcoming Republican Senate primary against young conservative Marco Rubio and the egregious tax flip all but eliminates Crist as a national political figure going forward. Crist’s move puts what was considered a likely hold for Republicans in the Senate with retiring Sen. Mel Martinez’s seat into jeopardy.
“Crist, who had repeatedly promised not to raise taxes, said Wednesday that the budget does not include ‘broad-based tax increases’’ — even though fees for the 15.6 million Florida driver licenses and 18.8 million registered vehicles will rise.
Democrats, particularly in the House, assailed the tax hikes. They said Republicans did too little to close tax loopholes and made too many cuts to programs helping seniors and foster kids. “This budget was balanced on the backs of the middle class, the working men and women of our state,” said Rep. Martin Kiar, D-Davie.”
Politico — President Obama cleans up out West
Writer Carol Lee was along as President Obama picked up perhaps $4 million for his fellow Democrats on a two-day western swing. Even if they had to mark down tickets for the Beverley Hills event to fill the seats, Obama had a hugely successful trip,
In addition to the money and getting by with some fudges at a stimulus event (100 projects in 100 days… kind of) Obama also picked up some chits from Harry Reid (the beneficiary of the Las Vegas fundraiser) and from Arlen Specter, the political Nosferatu who tagged along on the trip looking for some good press now that he has a bona fide Democratic primary challenger in Rep. Joe Sestack. Obama will likely call in the markers on Guantanamo and, if needed, the Supreme Court.
But mostly, the president seemed to just be enjoying his celebrity status.
“For all the entourages that tail Hollywood’s A-listers, none could say they traveled 0.2 miles in a 13-vehicle motorcade for less than one minute to get from their hotel room on the Vegas Strip to an event at Caesars Palace.
But that’s what Obama did. And after he arrived at Sen. Harry Reid’s fundraiser Tuesday night, the president had the audience laughing and hanging on his every word. The usually reserved Reid even made a joke about himself in a bathing suit.
Tuesday and Wednesday mark the closest thing to a vacation that Obama has had since taking office. He even left his press secretary back in Washington. (Although Obama’s chief speechwriter, Jon Favreau — also a bit of a celebrity — picked the Vegas and L.A. jaunt as his first presidential trip.)”
Wall Street Journal — The Bond Vigilantes
The Journal’s editorial page explains in four paragraphs the influence bond-buyers can have on U.S. fiscal policy when inflation fears begin to mount.
It wasn’t much of an issue for the past decade as easy credit and generally rapid growth.
But like Charles Bronson in a “Death Wish” sequel, the inflation-hating bond buyers have returned.
“They have cause to be worried, given Washington’s astonishing bet on fiscal and monetary reflation. The Obama Administration’s epic spending spree means the Treasury will have to float trillions of dollars in new debt in the next two or three years alone. Meanwhile, the Fed has gone beyond cutting rates to directly purchasing such financial assets as mortgage-backed securities, as well as directly monetizing federal debt by buying Treasurys for the first time in half a century. No wonder the Chinese and other dollar asset holders are nervous. They wonder — as do we — whether the unspoken Beltway strategy is to pay off this debt by inflating away its value.”
