Senate Democrats are tired of losing policy standoffs to Republicans. They are desperate for a win, any win, and they do not care who they have to hurt to get it. Hence Majority Leader Harry Reid’s, D-Nev., decision to block a vote on a House bill that would have temporarily funded the Federal Aviation Administration through September. Without the funding, the FAA is now in a partial shutdown that will cause 4,000 FAA employee furloughs, 70,000 lost construction jobs, and $1.2 billion in lost revenue.
Senate Democrats cite two problems with the House FAA bill: 1) it reverses a new National Labor Relations Board ruling that makes it easier to unionize, and 2) it cuts $16.5 million in funding for in “Essential Air Service” to 13 rural communities. The first objection is completely bogus. A long-term FAA funding bill approved by the House did contain a provision that reversed the NLRB ruling, but the temporary House funding bill, the one that would have kept everyone employed through September, does not contain any labor provisions in it. That leaves the $16.5 million in subsidies for rural airports. Rep. John Mica, R-Fla., explains what is really going on here: “The only one holding this up now is Mr. Rockefeller.” Mica was referring to Sen. John Rockefeller, D-W.Va., whose Morgantown, W.Va., airport is one of 13 rural communities that would lose subsidies in the House bill.
On Tuesday, Reid told reporters, “The Essential Air Service is a program that I believe in, but I also believe that $3,500 per passenger is a little extreme. That’s what Ely, Nevada is. And I do my best to protect the state, but sometimes you have to be reasonable.” But that was Tuesday. Now that the Democrats liberal base is apoplectic over the Democrats’ surrender on the debt deal, Reid has changed his tune. Now $3,500 per passenger subsidies are no longer extreme, they are essential. Killing over 70,000 jobs to protect rural air pork is an interesting way for Democrats to begin their pivot to jobs creation.
Around the Bigs
The Washington Examiner, FAA is new battleground for Obama, Congress: Darrell West, vice president of government studies at the Brookings Institution, says President Obama could end up being blamed: “Right now it’s Congress’ problem. But if [Obama] doesn’t do anything, it becomes his problem.”
The Washington Post, Debt crisis in Europe: Worries grow of spread to larger economies of Italy, Spain: Borrowing rates for Italian and Spanish debt reached 14-year highs yesterday as fears that European countries might default spread beyond Greece.
AFP, US borrowing tops 100% of GDP: Treasury: US debt shot up $238 billion to reach 100 percent of gross domestic project after the federal government’s debt limit was raised. The last time US debt topped the size of its annual economy was in 1947 just after World War II. By 1981 it had fallen to 32.5 percent.
USA Today, Poll: Thumbs down on the debt-ceiling deal: According to a USA TODAY/Gallup Poll, 46% disapprove of Americans disapprove of the debt limit hike and only 39% approve.
The New York Times, Pentagon Sounds Alarm on Threat of Budget Cuts: Defense Secretary Leon E. Panetta and top Pentagon officials said the up to $1 trillion in possible cuts from the debt hike deal could lead to thousands of layoffs, furloughs and reductions in military programs over the next decade.
The Wall Street Journal, Bondholders Win in Rhode Island: Thanks to a new state law that places bondholders ahead of other creditors, retired Central Falls, R.I., will probably not receive their full pensions after the town’s bankruptcy proceeding is finished.
The Wall Street Journal, Big Money Gets Into Landlord Game: Enticed by lower housing prices, hedge funds, university endowments, and pension funds are entering a market once dominated by mom-and-pop investors.
Campaign 2012
Perry: After coming under fire for his federalist views on same-sex marriage and abortion, Texas Gov. Rick Perry capitulated to social conservatives and came out in favor of constitutional amendments for both issues.
Perry II: The Washington Post profiles Perry’s efforts to lower tuition and increase efficiency at Texas universities.
Bachmann: Rep. Michele Bachmann, R-Minn., has a new ad up in Iowa touting her ‘no’ vote against raising the debt limit and inviting Iowans to vote for her in the Ames Straw poll later this month.
Pawlenty: Al Hubbard, a former director of the National Economic Council under President Bush, left former Minnesota Gov. Tim Pawlenty’s campaign yesterday. Hubbard had been a top policy advisor.
Righty Playbook
The Weekly Standard‘s Daniel Harper flags a Heritage Foundation chart showing that even if defense spending was cut to zero in 2012, we would still have massive deficits for years to come.
At The Corner, Iain Murray links to a website that maps everywhere in the country where government has cracked down on children’s lemonade stands.
Joy McCann details seven ways the Obama administration has made the economy worse.
Lefty Playbook
AMERICAblog‘s John Aravosis on the relationship between The White House and his liberal base: “They actually believe, inside the White House, that we’re to blame for their problems. That they’re doing a chipper job and the public would know it, but for the Netroots and the liberal advocacy groups doing such a lousy job selling the President’s magnificent handiwork.”
The Incidental Economist makes recommendation to the Super Congress on how they can cut Medicare spending, including: “Support the IPAB. Isn’t it obvious by now that Congress itself can’t control Medicare costs?”
The Washington Post‘s Suzy Khimm outlines a leftist agenda for job creation including: 1) Infrastructure Bank, 2) Surface Transportation Funding, 3) Tax Loopholes, 4) Job Training Programs, and 5) Aid to State and Local Governments.
