- •As much deficit reduction as the elimination of earmarks, President Obama’s proposed federal pay freeze, a 10 percent cut in the federal work force and a 50 percent cut in foreign aid — combined.
- •A tripling of federal funding for medical research.
- •Universal preschool for 3- and 4-year-olds, with relatively small class sizes.
- •A much larger troop surge in Afghanistan, raising spending by 60 percent from current levels.
- •A national infrastructure program to repair and upgrade roads, bridges, mass transit, water systems and levees.
- •A 15 percent cut in corporate taxes.
- •Twice as much money for clean-energy research as suggested by a recent bipartisan plan.
- •Free college, including room and board, for about half of all full-time students, at both four- and two-year colleges.
- •A $500 tax cut for all households.
Off Message Watch: "I Don’t Know That for Sure" – The administration just cannot admit that it made a mistake in proposing a stimulus package that was too small. This is from a Q&A with Austan Goolsbee:: Q. Would our economy be in better shape right now if the initial stimulus when the administration took office had been bigger? A. I don’t know the answer to that for sure. There’s a bit of a crystal ball in that. It obviously depends on what the things were. The right answer here is "of course if would have been better," and to then talk about how Republicans blocked any hope of additional stimulus once it was clear the economy was doing much worse than anticipated. But because the administration refuses to admit its mistake and concede that the stimulus was too small, it cannot bring itself to argue that the economy needs more help from fiscal authorities. There were nods in this direction now and again, but the administration never really tried to make this argument, a strong push for a job creation program for example, and it has thus given up the chance to make clear which party is standing in the way of providing more help for distressed households.
Below I review some of the ASF’s arguments and show why they’re just wrong. In particular, note the PSA language that I quote that demolishes the ASF’s claim that PSAs do not require an endorsement from every party in the securitization chain: "the original Mortgage Note bearing all intervening endorsements showing a complete chain of endorsement from the originator to the last endorsee" If there’s any doubt about what that language means (more discussion below), I’d love to hear it in the comments. There’s a very specific method of transfer required in securitization by PSAs and if it wasn’t followed, then under New York law, the transfers are void. And it is sure looking like many deals didn’t comply with the PSA terms.
States Want Their Cap-and-Trade Plans Added to U.S. EPA’s Carbon Limits – U.S. states with cap-and-trade laws want the Obama administration to add their carbon markets into new federal greenhouse-gas regulations, a California environmental official said. State-run carbon-trading programs should be “treated as equivalents or substitutes” for Environmental Protection Agency regulations for emissions tied to global warming from power plants, oil refineries and factories, Mary Nichols, chairman of the California Air Resources Board, said yesterday in a telephone interview. “It would be a way to make sure that industries in our state are not being penalized by being regulated by EPA on top of what the state is doing,”
The Bond Vigilantes Have Moved to Dublin – DURING the Reagan administration’s experiment with supply-side economics, the United States budget deficit swelled and bond buyers were appalled. They punished the government by pushing down the price of Treasuries. Ed Yardeni, then an economist with Prudential-Bache Securities, dubbed the informal posse of outraged investors “the bond vigilantes,” writing in 1983: “If the fiscal and monetary authorities won’t regulate the economy, the bond investor will.” Now an independent economist and market strategist, Mr. Yardeni says that over the last few years, the American vigilantes have been asleep at the switch — lulled by the Federal Reserve’s seductive monetary policies. While the budget deficit has mushroomed to previously unimaginable, $1 trillion-plus dimensions, bond traders have been buying Treasuries with gusto, keeping prices rich and yields extremely low. But in Europe, where a series of credit crises have sent the euro plummeting, the situation is quite different. There, he says, “the bond vigilantes are very, very active.”