Morning Must Reads

The president benefits from not having to defend a specific plan as he stumps for happy-sounding “health care reform,” but sooner or later, a law is going to come forward.

Writers Naftali Bendavid and Janet Adamy are the latest to pick up on the fact that with Democrats waiting for Kennedy’s return to complete their work, and the senator’s health very much in doubt, the possibility for a collision between Kennedy’s liberal ideas and a bipartisan compromise being worked up is very real.

While senators Max Baucus and Chuck Grassley are cooking up a compromise version of the bill in Senate Finance, an emotional and politically enfeebled Sen. Chris Dodd is keeping the home fires burning for Kennedy on Senate Health until the liberal Kennedy can get back to work.

“Sen. Kennedy’s staffers and allies emphasize that he remains deeply engaged in the health-care battle. In May, Senate Majority Leader Harry Reid (D., Nev.) said Mr. Kennedy was improving and would be back on Capitol Hill in June, though that hasn’t happened yet.

Mr. Kennedy has been seen in Washington rarely in recent months. He appeared at Mr. Obama’s inauguration in January, suffering a seizure and spending a night in the hospital. Mr. Kennedy also cast a key vote on the president’s $787 billion economic stimulus bill in February.

In May, the senator appeared for a vote on a public-service bill bearing his name, visiting the Senate floor accompanied by his son, Rep. Patrick Kennedy (D., R.I.) and receiving an ovation from colleagues on both sides of the aisle.”
 
Washington Post — U.S. Will Let Some Banks Repay Aid
 
Looking for a little good news to offset the unemployment numbers of last week, the Obama administration will announce today that some of the biggest banks that took money from the TARP program will be allowed to start repaying the cash – maybe as much as $65 billion.

The tension on the move seems to be between people who think the banking system is still on a sugar high and needs more regulations and to be slowly weaned from federal support and those who want to get the administration as far away from “billions for bankers” program as quickly as possible in order to lessen the political fallout.

Meanwhile, the New York Times reports that, perhaps in an effort to soften the blow, the administration will announce a broad set of principles on financial regulations – including restrictions on executive pay – early in the week.
But the new regs will do little to reassure those worried that the repayment is coming too soon and that the multiple other forms of support banks are getting have disguised the real state of affairs.

“Through cheap loans, debt guarantees and a promise that big banks will not be allowed to fail, these officials say the government has created an artificial environment in which profits and stock prices have rebounded, helping banks in recent weeks to raise about $50 billion from private investors.

The money allows the strongest banks to return federal aid provided at the peak of the fall financial crisis, but few banks have expressed eagerness for the government to end the other forms of support, creating concern that these programs will be habit-forming and more difficult to terminate.”
 
Bloomberg — Obama Unveils New Projects, Says Economy Has ‘Long Way to Go’

Trying to change the tone of economic discussion again, the White House today followed through on Vice President Biden’s promise to “ramp up” stimulus spending with a summer jobs program that President Obama promises will “create or save” 600,000 jobs.
Despite the continuing use of the creative definition, the stimulus has so far been a bust at dealing with unemployment.

The Obama summer jobs plan will put money into jobs for students and temporary and part-time work on WPA-style projects.

“The new projects are being framed as the beginning of a “summer of accelerated Recovery Act activity” by the administration and include new services at health centers in 50 states, work on 107 national parks, improvements at airports, highway locations and veterans’ medical facilities. They will also provide funding for schools to hire more teachers.

White House officials said yesterday they are encouraged by a slowing rate of job losses. The economy lost 345,000 jobs last month, fewer than expected and the lowest number since September, the Department of Labor reported June 5.

Still, unemployment rose to 9.4 percent, higher than the 8 percent the administration projected when it pressed Congress to enact the American Recovery and Reinvestment Act.”
 
New York Times – Obama’s Economic Circle Keeps Tensions Simmering
 
Just how hard is Lawrence Summers to work with? Writer Jackie Calmes reports that the divide between Obama’s economic people (Austan Goolsbee and Christina Romer) and the team of Summers and his acolyte Tim Geithner is pretty deep.

While others who came to the administration from outside the campaign have struggled to break into the Chicagoan inner circle, Summers has tromped in and become the loudest voice on the economy, in part by being the most willing to play politics with policy.
Calmes, though, may be setting him up for a fall.

“The president ‘invites debate but he doesn’t tolerate factionalism. And ultimately everybody on the economic team knows that at the end of the day we’re going to hold hands and jump together,’ [Presidential Advisor David] Axelrod added.

People familiar with the deliberations say that Mr. Summers has been more populist than they expected for a right-of-center economist, siding often with Mr. Obama’s political advisers. That has given rise to speculation among colleagues, associates and banking representatives that Mr. Summers is trying to win the [chairmanship of the Federal Reserve when Ben Bernanke’s term ends next year].

Mr. Summers, in an interview, dismissed such talk as coming from ‘people who disagree with me.’ He added, ‘The advice I give is based on determining the right course of economic action, recognizing all the political factors.’”
 
Washington Post — Antiabortion Efforts Move to the State Level

Writer Peter Slevin observes that since Democrats came to overwhelming control of the federal government, pro-life groups have redoubled their efforts to get states to make the procedure harder to get.

For many of the 1,787 doctors who perform 1.2 million abortions each year in the U.S., the rules are little changed since the days after Roe v. Wade. But in states like Mississippi or Wyoming, rules requiring parental consent, counseling, multiple visits and other preconditions – plus regular protests – have driven many doctors out of the business. Mississippi has one clinic. Wyoming has two and the rates are far below the national average.

As with gun control, Democrats – especially from rural regions – are increasingly unwilling to stick up for the party line on abortion, relying on the federal courts to uphold access to the procedure. But as pro-life lawmakers push their agendas, the chances of a showdown are growing.

“[Terri Herring, head of Mississippi’s Pro-Life America Network] has worked on more than a dozen pieces of legislation with the Chicago-based Americans United for Life, which takes credit for “helping state after state become more pro-life every year.” Her next goal is a law requiring clinic staff members to report the identities of the sexual partners of pregnant underage girls. She is also working on a school curriculum.

‘We have helped build a legal fence that helps protect women,’ Herring said. ‘The greater goal, even in legislation, is to influence the culture. This is a major culture war that isn’t going away.’”