Plans change. Cordray will now most likely get his chance after immigration reform legislation clears the Senate. And not because Reid is giving up on Cordray's nomination, but because he wants to turn Cordray and a handful of other nominees into a test of the GOP's vows to filibuster top Obama picks, including two designated cabinet secretaries.

The move serves two purposes: First, it removes one of the largest pretexts Republicans will have to walk away from immigration reform. Second, it puts Republicans on the spot in an exquisite -- and in Reid's mind necessary -- way, thus providing the nominees their best chance at confirmation, and leaving Democrats little choice, if the GOP blocks them, but to change the rules to immunize executive and judicial nominees from filibuster.

"The more likely scenario is that cloture is filed on some or all of them, because that is more substantive than a unanimous consent request," says a senior Democratic aide. "But that determination hasn't been made yet."

Lumping Cordray in with the rest will result in a more dramatic demonstration, top Democrats believe, than trickling the nominees out slowly.

That effectively puts Reid and Minority Leader Mitch McConnell on a collision course. If McConnell caves or works out an agreement with Reid, then the nuclear option will become inoperative. But if he doesn't and these confirmation votes fail, then Reid will either have to admit defeat or do ... something. In that sense he's essentially building a "permission structure" for himself and his caucus to do something about the rules in the event that Republicans make good on their threats.

"[Sandy aid] was totally different," Inhofe said on MSNBC Tuesday morning. "They were getting things, for instance, that was supposed to be in New Jersey. They had things in the Virgin Islands. They were fixing roads there, they were putting roofs on houses in Washington, D.C. Everybody was getting in and exploiting the tragedy that took place. That won't happen in Oklahoma."

A total of 31 Senate Republicans opposed the final Sandy relief bill earlier this year, citing small appropriations to repair damages and address concerns outside the hardest hit areas in New York and New Jersey, as well as the fact that the funds weren't offset, and because it contained $16 billion to be distributed as Community Development Block Grants.

Watch Inhofe on MSNBC below.

"We are aware of Mr. Santilli's comments and will take the appropriate follow up action," Edwin M. Donovan, a Secret Service spokesperson, told TPM on Monday. "He certainly has a right to free speech, but the Secret Service has a right and an obligation to determine what a person's intent is when making comments like this."

'Miss Hillary Clinton needs to be convicted, she needs to be tried, convicted and shot in the vagina," he said. "I wanna pull the trigger. That 'C U Next Tuesday' has killed human beings that are in our ranks of our service. I want to remind you that in Benghazi, Miss Hillary 'the fricken' biggest vagina on the face of the planet' told troops to stand down and to not go in and interfere with the operation that they set up because they're moving arms; Barack Obama is moving drugs through the CIA out of Afghanistan and Barack Obama needs to be tried, convicted, and shot for crimes against the United States of America."

The website Hypervocal has posted the audio.

In walking members and their staffs through the internal emails, the administration provided extensive explanations of how the talking points evolved, sources in attendance tell TPM. The extent of the information provided in the classified briefings calls into further question how a summary of the emails that was leaked to ABC News overstated the White House's role in crafting them. An intelligence official who participated in the briefings and spoke to TPM says that the discrenpacy between the emails he briefed Congress about and the ABC News report "speak for itself."

The ABC report was based on notes taken by a still-unnamed source, presumably a Republican, in attendance at one of two briefings the administration held for members and senior staffers of the Senate and House intelligence committees and top leadership offices in February and March of this year. The ABC report contained a great deal of the information the White House would ultimately reveal itself this week when it released all of the inter- and intra-agency email communication that ultimately resulted in the talking points Susan Rice used in a now-infamous series of appearances on network news shows on the Sunday after the attack.

But it got one big part about the White House's role wrong:

In an email dated 9/14/12 at 9:34 p.m. -- three days after the attack and two days before Ambassador Rice appeared on the Sunday shows -- Deputy National Security Advisor Ben Rhodes wrote an email saying the State Department's concerns needed to be addressed. "We must make sure that the talking points reflect all agency equities, including those of the State Department, and we don't want to undermine the FBI investigation. We thus will work through the talking points tomorrow morning at the Deputies Committee meeting."

It turns out that's not what the email said. To quiet the growing furor over the idea that the White House had thumbed the scale on the State Department's behalf, a government official subsequently leaked to CNN the full text of Rhodes' message, which was assiduously neutral about each relevant agency's concerns.

But discussions with several people in attendance at or with knowledge of the two congressional briefings suggest that members and staffers were left with the opposite impression -- that the White House had remained neutral in the dispute between the State Department and the CIA -- and that after a thorough run-through, they were given ample time to take notes not just about the briefing itself, but in theory to transcribe key emails verbatim.

"When I say they were allowed to have the documents for as long as they wanted, they were allowed to take notes for as long as they wanted as well," the intelligence official said.

The discrepancy between the documents ABC was provided and the official records has led White House officials, congressional aides, and outside observers to the conclusion that a GOP member or staffer falsified notes or tendentiously interpreted administration emails -- and then leaked them -- to create the impression that the White House had sided with the State Department in an intra-agency dispute to protect President Obama from political blowback.

"I got a lot of questions probing in a lot areas," the intelligence official said. "Truthfully I cannot recall whether I specifically got any questions asking about the White House. All the questions I got were not sort of tendentious questions but they were asking facts, to understand what went on."

After those briefings, the Benghazi controversy quieted down for several weeks -- a tellingly long silence given how damning the emails supposedly were -- until ABC's report, including its characterization of the White House's involvement, exploded in the press late last week. Karl, who downplayed the discrepancies between the summaries he relied on and the actual emails, was not immediately available for comment for this story.

"I wouldn't go into what the members said in the meeting," the intelligence official said. "The relationship between what the documents show and what the report said sort of speak for itself."

A congressional source who attended one of the two meetings had a similar recollection.

"I don't recall a single member asking a single question or making a single statement suggesting the White House played anything other than an appropriate role in resolving the disagreement over the talking points," the source said.

On top of that, the source added that the CIA had acknowledged on other occasions making all of the major changes to the talking points itself, irrespective of the State Department's concerns.

"The CIA itself and then the ODNI [Office of the Director of National Intelligence] who walked us through the emails all made clear that every one of the changes with regard to the involvement the naming of al Qaeda and Ansar al Sharia were made by the CIA," the source added. "Petraeus and Morell were saying that last year.... They were extremely forthcoming about that from the beginning. That piece of knowledge was repeated so many times in so many different briefings it would be impossible for me to believe that anybody left with the impression that anyone other than the CIA made the changes."

This source draws a connection between the notes quoted in the ABC report, and an April report from House Republicans which attributes the changes to the State Department.

"The House Republican report so distorted its coverage of the talking points changes. ... I see no reason to believe it wouldn't be the same thing with regard to the Ben Rhodes email."

A senior House Republican aide with knowledge of the briefing but who denies being ABC's source still largely backs the GOP characterization of the emails, and says any mischaracterizations were unintentional, and the result of poor communication.

"The idea anyone was nefariously putting words in people's mouths just isn't based in reality," the aide emailed. "This ALL goes back to a disconnect between quoting summaries vs quoting verbatims. And, again, ABC acknowledges they weren't clear enough in their first story about what they were told they had been given."

That explanation doesn't cut it for Democrats.

"I think they thought that this stuff would never be declassified or something," said one House source with knowledge of the briefing. "Some of them could've taken really bad notes, but to me this looks more intentional."

To the congressional source in attendance, it's all part of the GOP obsession with Benghazi. "I know for a fact that some of the Republican critics -- they are true believers. .... They may not have found the smoking gun yet that convinces everyone else there was a coverup, but there's no question in their mind that it's there somewhere, evidence notwithstanding."

IRS will administer key ACA revenue and subsidy provisions, and a major scandal at the agency offers the GOP a unique opportunity to question the wisdom of expanding its authority.

But some conservatives hope to draw a less direct, but in theory much more consequential, connection between Obamacare and IRS malfeasance -- one which they hope will result in denial of benefits to millions of uninsured taxpayers, and perhaps the unwinding of the entire law.

Enter the IRS, which interpreted that language in its regulation-writing process as meaning that those people will in fact be eligible for insurance subsidies in every state, regardless of whether the exchange is state- or Washington-run.

Conservatives, and even some GOP lawmakers, contend the IRS's interpretation was unlawful -- and now they want to yoke their narrow reading of the law to the unrelated political non-profit controversy.

"The IRS has announced that it will violate the text of the law and issue health insurance subsidies through federal exchanges, something Congress did not authorize," Senate Minority Whip John Cornyn (R-TX) said in floor remarks this week. "The law clearly states that these subsidies are not available to the federal exchange but only to the state-based exchanges. It's the case that the President's health care law will dramatically expand the power of the Internal Revenue Service because the agency is responsible for implementing so much of Obamacare's most important provisions. Well, given what we've learned about IRS malfeasance, does that really sound like a good idea, to give them more responsibility, to hire more agents before we get to the bottom of the present scandal?"

The conservative hue and cry for pursuing this approach to undermining Obamacare is much quieter than the one that culminated in a landmark Supreme Court decision to uphold the law last year. That reflects a combination of factors: the argument's weaker, the politics are much less straightforward, the complaint is aimed at benefits that nobody's received yet. The IRS scandal could change that dynamic.

And though reform supporters don't want to see this idea take flight in the media the way the novel theories underlying previous ACA challenges did, they don't believe it's persuasive enough to pose much of a danger to the law.

"If and when this gets to court, courts are going to look at this and say, well, this isn't a very well-worded statute, but when you look at it as a whole, it's clear that it intends federal exchanges to issue premium tax credits," says Timothy Jost, a law professor at Washington and Lee University, and an ACA supporter.

Ironically, the conservatives who devised this argument cite a paper Jost wrote in 2009 to bolster their own claims. In it, he muses among many other things that Congress could theoretically deny insurance subsidies to federal exchanges on purpose, to incentivize states to erect them on their own. The implication is that Congress may have adopted Jost's idea intentionally.

The legislative history of the ACA, along with its interpretation by government agencies, official analyses by the Congressional Budget Office, and the broad consensus of the members of Congress who wrote the law belies this notion. (Jost never endorsed the idea, either, and called the notion that he inspired or promoted it "weak.")

The Congressional Research Service has looked at this issue closely, too. Its conclusion suggests that unless courts read the portion of the law at issue in isolation, and precisely as the laws opponents characterize it, then legal challengers will have a hard time denying subsidies to individuals via federal exchanges. The IRS' interpretation of the statute would stand. And even that determination would probably have to wait until 2015, before which challengers will have a hard time demonstrating standing.

"By 2015, somebody will have standing to raise it, then I think the question will be are the courts really prepared to rescind tax credits for millions of Americans," Jost said.

On top of all that, if individuals in states with federal exchanges are ultimately denied insurance subsidies, their lawmakers -- most of them red-state lawmakers -- would find themselves under immense pressure to fix the law, and quickly.

Why? Jost explains, "if a court would ever hold that the federal exchanges couldn't issue premium tax credits, it would be a serious problem, because it would deprive millions of Americans of tax breaks and insurance, it would also weaken the individual mandate."

So it's an unlikely outcome that's also a long way off. But the ideas adherents have been waiting for a chance to take it mainstream. The IRS scandal provides it to them.

At a reporter roundtable in his Capitol Hill suite Wednesday, Reid claimed responsibility for Democrats' decision to provide the FAA -- and only the FAA -- unique flexibility under sequestration to move money between accounts, and thus to avoid scheduled tower closures and controller furloughs causing major travel delays that were expected to drag on for months.

"I take all the blame," Reid acknowledged.

"I think the next thing I see that's going to ask for, 'let's just take care of this,' is going to be the Pentagon," Reid said. "They're asking already for more money for a number of different things. I think the time has come that we -- if something comes up in the military, that we have to understand there are a lot of people out there who don't have lobbyists, who don't have people up here to advocate for them."

"We've got the 70,000 kids on head start, meals on wheels, NIH ... we have all kinds of issues that sequestration is hurting," Reid said. "I'm not going to apologize for what we've done with air-traffic control, but hopefully in the future we're going to stop this."

This is the first time since the FAA bill passed that Reid has claimed that he will not address sequestration in a piecemeal fashion. He made similar public assurances before travel delays became an issue, but then ultimately agreed to grease legislation to fix that problem in isolation.

Responding to pressure from reporters and Republicans on Capitol Hill, the administration released what they claim are all emails internal to, and between, relevant government agencies drawing up the talking points that Susan Rice used when appearing on Sunday talk shows a few days after the attacks that left four Americans, including U.S. Ambassador to Libya Christopher Stevens, dead. Those emails are characteristic of the laborious bureaucratic process required to finalize the talking points, but do reflect disagreements between senior officials in agencies outside the White House over what information the talking points should contain.

That squabbling -- which appear to reflect at least in part the two agencies' desires to insulate themselves from blame for the attacks -- is the only remaining aspect of the controversy, perpetuated by Republicans and conservatives, over the administration's private deliberations and public communications in the days after the attack.

Notably, the officials at the briefing sought to downplay that tension as well. The final talking points, they noted, were edited most thoroughly by CIA Deputy Director Michael Morrell, and reflect the modifications the State Department was seeking.

But Morrell's modifications reflected his own disagreements with early drafts, independent of State Department's similar objections, the officials stressed in the briefing, suggesting the rift between State and CIA was less severe than first believed.

That view is backed, in part, by sign-off from Morrell's top terror analyst, who in one email responded to Morrell's edits, "They are fine with me. But, pretty sure HPSCI [the House Permanent Select Committee On Intelligence] won't like them. :-)"

Then-CIA Director David Petraeus did raise objections to the final drafts, reflecting both his desire that the talking points contain information about CIA warnings regarding the security situation in the region, and his belief that HSPCI members would not be satisfied with them.

"No mention of the cable to Cairo, either? Frankly, I'd just as soon not use this, then... NSS's call, to be sure; however, this is certainly not what Vice Chairman Ruppersberger was hoping to get for unclas[sified] use. Regardless, thx for the great work."

NSS refers to the White House National Security Staff. Rep. Dutch Ruppersberger (D-MD) is the top Democrat on the House Permanent Select Committee On Intelligence.

The emails do not make clear why HSPCI members, including Ruppersberger, would be unhappy with the talking points, but they suggest that it was because the final version of the talking points lacked sufficient detail about the incident.

"I think most everyone knows if [Hillary Clinton] wants to run for President, she's going to get that nomination," he told a small group of reporters during a roundtable discussion in his Capitol suite Wednesday afternoon.

"To keep going over this thing, day after day, on things that have been in the public record for months and months, it's obvious that it's an attempt to embarrass President Obama and to embarrass Hillary Clinton," Reid said, before assessing the Democratic primary field.

Reid acknowledged that the Benghazi attacks raise legitimate national security questions -- just not the ones Republicans are hyper-focused on.

"The Speaker says he's obsessed with this and it appears that's the case," Reid snarked. "There are terrorists -- really that's a new part of the world that we have to understand. There are terrorists who want to do us harm. You, your family, for no reason that we can appreciate or comprehend. That's what we should be doing, is spending our time determining how we're going to handle the terrorists, whether that's economic means to make people feel better or whether it's more security-directed stuff."

Instead, Republicans have harnessed themselves to the allegation that the Obama administration wanted to cover up the fact that there had been a terrorist attack -- a contention that feeds a much uglier conspiracy theory.

"Republicans are doing everything they can to ratchet back more security for embassies," Reid said. "This is just a sideshow, trying to embarrass Obama and Clinton."

To that end, he'll hold a vote on Cordray's nomination next week.

Reid's decision to eschew significant reforms to Senate filibuster rules at the beginning of the current Congress -- and his continuing reluctance to revisit those rules despite recent filibusters of cabinet nominees -- angers allies both on and off of Capitol Hill.

But he continues to approach the issue cautiously.

"I'm not going to do anything now, precipitously," he said. "But I'm looking at this very closely.... We're going to fill that job. Cordray is there now. He's going to get a vote."

Reid wasn't able to explain why he believes (or claims to believe) Cordray will ultimately be confirmed. But he alluded to the possibility that he may pursue a rules change mid-session.

"Whether it's Jeb Bush or Hillary Clinton that's the next president, I don't think they should have to go through what we've gone through here," Reid said. "People better watch."

Conservatives and GOP members of Congress issued dire warnings shortly after the news broke. But the fact that the revelation came less than a week before the House of Representatives votes (again) to repeal Obamacare probably hastened a legislative linkage.

And here it is.

"I believe we need to address IRS funding in the health care law now, which may mean calling for a temporary suspension until it is clearer where this funding will go," Heller wrote. "I want you to know I intend to introduce legislation this week to suspend IRS funding for new agents enforcing the health care law until Congress sees an improvement. I am hoping this legislation is unnecessary and that we may work together to find a solution to this problem together."

The letter is a bit muddled. It alludes to President Obama's budget and the ACA itself, without drawing distinctions between the two. Obama's budget calls for higher IRS spending ahead of ACA implementation, but has no binding force.

It's also unclear whether Heller proposes to (perhaps temporarily) withhold money that's already been appropriated to the IRS, or to rescind its authority to spend current and future funds to implement and administer the law.

A Heller spokesperson did not immediately respond to a request for clarification.

At his weekly briefing with reporters Tuesday, House Minority Whip Steny Hoyer (D-MD) addressed the conflation directly. "I don't think that this [IRS controversy] is anything that is going to undermine the IRS's credibility vis-a-vis the implementation of the Affordable Care Act."

Perhaps. But it's already refueling the GOP's ongoing political drive to repeal the law in full or in part.

And it could draw more attention to brewing conservative efforts to rescind ACA insurance subsidies to beneficiaries in states that will have federally-run exchanges. Senate Minority Whip John Cornyn (R-TX) tried on Tuesday to tie that more obscure issue to the unfolding non-profit scandal.

"The IRS has announced that it will violate the text of the law and issue health insurance subsidies through federal exchanges, something Congress did not authorize," Cornyn said remarks on the floor. "The law clearly states that these subsidies are not available to the federal exchange but only to the state-based-exchanges. It's the case that the President's health care law will dramatically expand the power of the Internal Revenue Service because the agency is responsible for implementing so much of Obamacare's most important provisions. Well, given what we've learned about IRS malfeasance, does that really sound like a good idea, to give them more responsibility, to hire more agents before we get to the bottom of the present scandal?"

You can read Heller's letter in full below.

At his weekly Capitol briefing Thursday, Boehner faced questions about two aging and increasingly questionable elements of the GOP's legislative strategy: repeated votes to repeal the Affordable Care Act and continued efforts to extract partisan concessions from Democrats in exchange for increasing the debt ceiling.

In both cases, Boehner acknowledged that the conservative wing of the House is driving the agenda.

And the debt ceiling? Same basic story.

"Our conversations have begun," he said. "We're going to have a big conversation with our members next week to talk about a way forward -- what do our members believe is necessary to allow them to vote yes on increasing the debt limit?"

It's yet more evidence that the party's national and legislative strategies are driven by rank and file conservatives, not party leadership.

To his credit, Boehner tried to nudge the GOP conference away from an obsession with the Boehner rule -- the idea that debt limit increases must be paired with spending cuts of equal measure -- and toward naming other party priorities as its ransom.

But ironically that illustrates the fact that the rank and file is driving a strategy that was of questionable usefulness when the GOP adopted it the first time, and lost the rest after President Obama won re-election.

"[D]ealing with the long-term structural spending problem we have frankly is at the core of it. But we also know we can't cut our way to prosperity," Boehner said, perhaps unintentionally repeating one of Democrats' most common budget talking points. "We need real economic growth. And that's why you continue to hear a lot of discussion about tax reform, regulatory reform, that would help us produce economic growth here in our country."

They made sure as many as people as possible saw him condescend to Sen. Dianne Feinstein (D-CA), as she tried to advance an assault weapons ban in the wake of the Sandy Hook massacre. When he launched a failed filibuster of more modest gun legislation the public relations backlash (nurtured by Democrats) made him persona non grata with some members of his own party.

Among Democrats, he is one of the most widely cited opponents of immigration reform.

And this week no less a powerbroker than Senate Majority Leader Harry Reid (D-NV) called Cruz a "schoolyard bully" and the "very junior senator from Texas," after Cruz blocked further formal budget negotiations absent a pre-emptive Democratic surrender.

Yup, Democrats can't stand Ted Cruz. Except that they also kind of love him.

"I think the buzz around Sen. Cruz, both on the Senate floor and over the airwaves, represents a sincere effort on the part of Democrats to highlight the true, new face of the GOP -- or at least its conservative wing (which is pretty much the whole bird these days)," Democratic strategist Paul Begala told TPM by email. "Just as Joe McCarthy embodied the paranoid extreme right in the 50s, Ted Cruz does so today. The difference is, in the 1950s mainstream Republicans like Pres. Eisenhower and Sen. Prescott Bush stood up to McCarthy, today's Republicans (with the notable and admirable exception of John McCain) are so cowed by Cruz you can almost hear them moo. And so it falls to Democrats to shine a light on him."

The dynamic resembles Democratic efforts to increase the stature of unelectable GOP candidates from Sharron Angle to Christine O'Donnell to Mitt Romney's many would-be rivals. In 2011, Nancy Pelosi roiled the Republican presidential primary when she told TPM, "I like Barney Frank's quote the best, where he said 'I never thought I'd live such a good life that I would see Newt Gingrich be the nominee of the Republican Party,'" and alluded to a rich field of material Democrats would use against him.

Nobody was happier with her comments than Gingrich himself.

Cruz and top Democrats enjoy a similar symbiosis. When Reid insults him, and when he gets under Feinstein's skin, that helps him with the GOP base. When Democratic strategist James Carville goes on national television to acknowledge Cruz's talents and kinda-sorta suggest Democrats would be scared to run against him, we recognize that as tried-and-true but harmless ratfucking, to use the technical term. Cruz sees it as an opportunity to tout his conservative bona fides.

Everyone wins -- except the rest of the GOP.

"It is fair to say that there's a general sense that the more Ted Cruz and Rand Paul are the face of the Republican Party, the worse it is for the Republican brand and the better it is for Democrats," said a senior Democratic Senate aide. "I think most [Republicans] get it, but I don't think there's anything they can do about it without risking a huge backlash given how beloved those guys are by the base. No one is stepping up to say, we Republicans need to come to our senses and do the right thing to preserve our brand. Everybody is just trying to survive their own race, and hoping some savior will come along and rebrand their party. Enter Eric Cantor ... aaaand, exit Eric Cantor."

Reached for comment for this story, a Cruz spokesperson declined to comment, except to say, "The senator's focused on his work for Texans in the Senate."

Now, research papers suggests the recent slowdown doesn't just reflect temporary economic weakness, but also structural shifts in how health care is delivered and financed -- possibly attributable to the Affordable Care Act -- and thus might be a harbinger of a longer-term trend.

The study by Harvard researchers, featured in the latest edition of Health Affairs, finds, like all studies of this nature, that the recession and weak economy contributed significantly to the spending growth slowdown. Less generous benefits, resulting in higher out-of-pocket costs, accounted for 20 percent of it. Faced with less generous coverage and less disposable income, people consumed fewer health services.

But the good news is that spending growth also slowed among those whose health benefits haven't changed, including Medicare patients. And that suggests a more enduring trend.

"Our findings suggest cautious optimism that the slowdown in the growth of health spending may persist -- a change that, if borne out, could have a major impact on US health spending projections and fiscal challenges facing the country," the authors write.

In a related article, health care economist David Cutler attributes the majority of the slowdown to fundamental changes -- including perhaps slowing technological and pharmaceutical innovation, and increased efficiency among providers. If current trends continue, he concludes, then over the next 10 years "public-sector health care spending will be as much as $770 billion less than predicted. Such lower levels of spending would have an enormous impact on the US economy and on government and household finances."

To put it in perspective, that $770 billion is equivalent to about three-quarters of sequestration's mandatory, indiscriminate spending cuts, which lawmakers have been unable to replace with either more targeted cuts or a mix of cuts and higher taxes. The paper implies that budget deficits will shrink by an amount similar to sequestration even if Congress were to simply rescind it.

Studies over the past few years have been unspecific about the non-macroeconomic causes of the spending growth slowdown, and guarded about the likelihood that it will persist. In particular, they've been cautious about attributing any of it to the slow move away from fee-for-service medicine, which the Affordable Care Act hopes to accelerate. The new papers don't explicitly credit the ACA for slowing down spending growth, but many experts -- particularly those that support the law -- believe it is a contributing factor.

But the news isn't all good. It also reflects the fact that the cost of consuming health care has far outpaced wages over the past several years, leaving many people and families unable to afford services they may need.

But the biggest news from the Labor Department isn't the topline payroll figure, or the unemployment rate, which dropped from 7.6 to 7.5 percent. It's the revisions to reports from previous months, which are more certain statistically and indicate much stronger job growth this winter than initially believed.

What emerges from the new numbers is a significant drop off from February to now, though it's not clear what caused it or whether it will dissipate with future upward revisions to the April numbers. One disturbing possibility is that the drop off could be a reflection of the impact of austerity measures on the economy, which would suggest that absent GOP unwillingness to replace or rescind sequestration, the continuing recovery would be much more robust.

The internal figures in the April report are fairly impressive.

Retail employment, which had appeared to fall last month, is up 29,000 jobs in April, suggesting sales have endured despite an automatic two percent increase in the payroll tax at the beginning of the year. Health care continues to be a major growth industry, adding 19,000 jobs lat month.

But the public sector continues to be a drag on growth. The private sector actually added 176,000 jobs last month, according to the initial figures, reflecting the loss of 11,000 government jobs. Post office layoffs account for 3,500 of those. State and local for another 3,000. The rest were federal jobs, which along with a slight drop in average weekly hours worked, is the clearest symptom of sequestration in this otherwise fairly strong report.

Mere days had passed since he'd introduced a budget designed successfully to impress upon political elites that congressional Republicans represent the main obstacle to steady governing in Washington, and already those same elites were regressing to the reflexive view that legislative gridlock is an automatic byproduct of partisan polarization and weak leadership in the White House.

Obama attempted in two separate public appearances this past week -- a comedy routine at the White House Correspondent's Association Dinner last Saturday evening, and a daytime press conference at the White House on Tuesday -- to disabuse the press of the idea that Congress' inability to pass even modest and popular legislation is a consequence of his failure to engage in the mythical armtwisting of LBJ or Lincoln.

"I cannot force Republicans to embrace ... common-sense solutions," Obama said at the press conference, referring specifically to budget gridlock. "I can urge them to. I can put pressure on them. I can rally the American people around those common-sense solutions. But ultimately, they, themselves, are going to have to say, we want to do the right thing. And I think there are members certainly in the Senate right now, and I suspect members in the House as well, who understand that deep down. But they're worried about their politics. It's tough. Their base thinks that compromise with me is somehow a betrayal. They're worried about primaries. And I understand all that. And we're going to try to do everything we can to create a permission structure for them to be able to do what's going to be best for the country. But it's going to take some time."

Considering the incentives of the minority party in a polarized political system with a divided legislature, Obama's remarks rang true. And in that context, his mysterious claim to be creating a "permission structure" for the GOP sounded almost like an allusion to a Rube Goldberg device that could transform Republicans from tireless obstructionists into reluctant partners -- an unlikely contraption, but perhaps the only thing short of total lawlessness that might yield Republican support for a budget deal or any other major bipartisan enterprise.

The intentional vagueness made it the most interesting moment in his press conference. Unfortunately it failed to persuade the very elites who had raised the question of his effectiveness in the first place.

The Washington Post's Dana Milbank snarked: "It's the president's job to lead, and to bang heads if necessary, regardless of any 'permission structure.'"

Their dismissiveness belies a genuine confusion about what exactly Obama was describing. The words "permission structure" may be unnecessarily colorless, but they reveal the very sort of problem solving and organizing efforts that critics of his leadership claim he lacks.

Neither the concept nor the term "permission structure" is new to Obama's closest advisers. Eliciting what David Axelrod has called "third-party authentication" -- behavioral signals designed to create unlikely bedfellows -- has been key to their political and legislative strategies for years.

In this instance, the "permission structure" refers to Obama's efforts to convene a bipartisan group of senators who can reach a budget deal without his direct imprimatur, according to both White House and Senate aides. His recent dinners with members of both parties were designed to ferret out the Republican and Democratic senators who are likeliest to agree to a mix of higher taxes and lower spending, much like the defunct gang of six did in 2011.

"Obama's trying to see if he can't get some of those rational actors from the dinners -- or at least the people who came across as being earnest and willing -- to tackle the grand bargain talks again," said a Senate Democratic leadership aide. "The White House trying to set up a process where rank and file Republicans are working with rank and file Democrats and once that's done, step back [and] create the space for those discussions to take place among rank and file lawmakers outside the context of another Obama-Boehner style negotiation."

Obama's putative absence is key to creating the political space Senate Republicans need to negotiate in good faith. As Sen. Pat Toomey (R-PA) revealed in an interview about the gun bill's failure this week, "There were some on my side who did not want to be seen helping the president do something he wanted to get done, just because the president wanted to do it." (Toomey is one of the Senate's most conservative members, but will face a tough re-election in 2016 and not coincidentally was an author of the failed gun bill.)

If the senators can use that space productively, their efforts will be part of a two-pronged strategy: First, force House Republicans to choose between cooperation and rejectionism by building strong bipartisan support for a budget bill in the Senate; second, let Republican Senators, rather than Obama himself, be the emissaries for that legislation.

It bears an uncanny resemblance to a strategy Axelrod used to help elect Michael White, a black candidate, the Mayor of Cleveland Ohio more than 20 years ago, which The New Republic described in a 2008 Axelrod profile dated November 5 -- one day after Obama defeated war hero John McCain in a historic landslide.

"'David felt there almost had to be a permission structure set up for certain white voters to consider a black candidate,' explains Ken Snyder, a Democratic consultant and Axelrod protege. In Cleveland, that was the city's daily newspaper, The Plain Dealer. Largely on the basis of The Plain Dealer's endorsement and his personal story, White went on to defeat Forbes with 81 percent of the vote in the city's white wards."

But if it were as easy as remaining invisible, Obama would have reached a budget deal a long time ago. The truth is there's a lot more to his permission structure than just holding back enough to allow senators to shake hands on a budget deal, whether Obama sees it that way or not. Before he can sign a bill he needs the House of Representatives to pass one. That means winning buy-in from House Republicans -- a much more recalcitrant group than their Senate counterparts -- and that means creating an other-worldly mix of atmospheric and procedural and rhetorical conditions that will allow GOP leaders and a big group of their members to give Obama something he wants, that they hate, while claiming they won a big fight...all without appearing to have consorted with him in any way.

"For the past two to three years, the only way we can get anything done is if Republican leadership can find a way to get around their Tea Party," said another highly placed Senate Democratic aide. "It's slightly absurd that we have to focus on helping Republicans get their own caucus in line but that has to be one of our priorities because they're not going to do it all on their own."

For the purposes of a budget deal that includes higher taxes, replaces sequestration, and takes the debt limit off the table, the aide notes that creating a "permission structure" amounts to manipulating the legislative and political processes in ways that will allow Republicans to obscure the fact that they've caved.

That's a much greater challenge than passing legislation in the Senate, where several Republicans have expressed willingness to buck the party's anti-tax orthodoxy. It may not be possible. But if it is, then an overwhelming Senate vote will be necessary but insufficient.

House Republicans will also need to feel a sense of urgency -- one that doesn't exist yet under sequestration alone -- and also, most likely, a plausible assurance that they weren't simply jammed by the Senate, even if that assurance hangs from a thin reed.

One increasingly likely way to generate a contrived sense of urgency would be to link Senate budget action with the need to increase the debt limit later this year. In an ironic twist, Republican leaders would have to turn the same debt limit threat they used to mug President Obama in 2011 on themselves and their own members.

Obama's proved he has the mettle to call the GOP's debt limit bluff, and House GOP leadership would suddenly be faced with a choice between using the debt limit as an opportunity to put an end to the budget wars while pocketing concessions from Obama, and tanking the Senate bill and raising the debt limit essentially for free. (Free that is, if you don't count the damage they'd inflict upon themselves with the broader public.)

That's a fuller blueprint of the permission structure. But even if John Boehner and Eric Cantor decided to hop on to it, they'd still have to fix its remaining weaknesses. Procedurally, any "grand bargain" will be a revenue bill, which per the Constitution must originate in the House of Representatives. And yet, as the leadership aide noted, "anything you do along these lines is a Senate-first strategy."

Similarly House Republicans would once again have to abandon the "regular order" of committee hearings and bill mark ups and bring the legislation directly to the floor, with at best a limited opportunity for members to offer and vote on amendments.

These are easy problems to solve in theory, and in practice they often takes care of themselves. But when the point is for House Republicans to obscure their willingness to work constructively with Democrats, addressing them becomes much more difficult.

Likewise, if House Republicans want their own imprint on the bill -- even in a stage-managed way -- they'll have to introduce and own the very entitlement benefit cuts they claim to want, but are terrified to propose themselves.

So it's a rickety structure. But the alternative for Obama is to limp along with sequestration, or at best perpetually underfunded discretionary programs, and cede debt limit politics to the GOP for the foreseeable future.

House Republicans aren't sitting around waiting for Democrats to mold the country's broken budget process into something workable. They're debating what to ask for in return for raising the debt limit amongst themselves, on the assumption that the Senate will do nothing. They know they ultimately can't strong-arm Democrats like they did two years ago. But that doesn't mean they can't try -- and perhaps even pocket something meaningful.

One ransom under consideration would create a legislative fast-track -- much like the budget reconciliation process -- for tax reform. Advocates envision a two-tranche debt limit increase: first, when the process is created; then again once Obama signs the reforms into law.

Three senior aides say the Senate Democratic leadership won't cede policy to the GOP in exchange for a debt limit increase, particularly if the reforms themselves would have to be revenue neutral, as House Republicans would likely insist.

But they're engaged in a pincer movement of their own, and are hoping to recruit retiring Sen. Max Baucus (D-MT) -- the powerful Finance Committee chair -- into their efforts.

"No one knows what's going to happen" Baucus told the Washington Post, shortly before announcing he will not seek reelection. "[S]omething's going to have to give. And maybe what gives is some instructions for Finance and Ways and Means to come up with a solution."

If the "permission structure" collapses, then, it won't just consign the country to another year or more of budget chaos. It will also pose a real threat to the Democratic Party's consensus position on taxes, which Obama spent most of his first term building.

But though he placed the onus on congressional Republicans to work constructively with him -- specifically to replace sequestration -- he did allude to an ongoing effort to provide GOP elected officials with the political cover they need to reach a budget agreement with Democrats.

"You seem to suggest somehow these folks over there have no responsibilities and my job is to somehow get them to behave," Obama said. "That's their job. They're elected, members of Congress are elected, to do what's right for their constituents and the American people."

Obama was referring specifically to Congress' unusual haste to alleviate the consequences of sequestration for air travelers, and more broadly to the GOP's positions on sequestration, which have changed over time, depending on particulars.

"You'll recall that even as recently as my campaign Republicans were saying sequester is terrible, this is a disaster, it is going to be disastrous to the economy," Obama reminded reporters. "Then when it was determined that doing something about it might mean we close some tax loopholes for the wealthy and well connected then they said, 'you know what? We'll take the sequester. The president is crying wolf, he's chicken little. The sequester no problem.' ...

Despite the fact that a lot of members of Congress were suggesting that somehow the sequester was a victory for them and this wouldn't hurt the economy, what we now know is what I warned earlier ... is happening. It's slowed our growth. It's resulted in people being thrown out of work and it's hurting folks all across the country. The fact that Congress responded to the short term problem of flight delays by giving us the option of shifting money that's designed to repair and improve airports over the long term to fix the short-term problem, that's not a solution.

Obama has been in active discussion with GOP senators to reach a budget consensus, and he alluded to efforts the administration and congressional Democrats have been undertaking to create the procedural and rhetorical space on Capitol Hill to allow Republicans to agree to a budget deal without appearing to have caved or cooperated with the White House.

"Ultimately they themselves are going to have to say we'll do the right thing," Obama said. "There are members in the Senate right now and I suspect members in the House as well who understand that deep down, but they're worried about their politics. It's tough. Their base thinks that compromise would mean somehow a betrayal. They're worried about primaries and I understand all that. And we're going to try to do everything we can to create a permission structure to do what's best for the country."

"I think we're going in the right direction here," Sen. Sherrod Brown (D-OH) told TPM during an interview in his Senate office last week. "I feel good about it."

Brown, along with Iowa populist Tom Harkin bucked Democratic leadership six years ago and voted to block a bipartisan immigration reform bill sponsored by Sens. Ted Kennedy (D-MA) and John McCain (R-AZ), in part because of the legislation's guest worker provisions, which they concluded would be detrimental to low-skilled workers in the United States.

"I think done right -- and I think they're doing it right -- it could mean wages increase for low-income workers, both immigrant workers, those that are already here not yet legally, and for American workers now," Brown said. "Paying under the table has been such a downward drag on wages. I think the 11 million deserve to be out of the shadows and toward citizenship if they earn it. I think this is good for employers, I think you're going to see a pretty good groundswell for it."

The final vote was 361-41 -- because it was fast-tracked it required a two-thirds House majority to pass.

The legislation, now adopted by both chambers in a unusually swift and deliberate fashion over the course of 15 hours, is intended to remedy widespread staffing-related flight delays which have dogged travelers all week.

But it's also a dramatic surrender by congressional Democrats and the White House in the ongoing public fight over sequestration.

By agreeing to provide special treatment to air travelers, Democrats eliminated a major source of public pressure to address sequestration in its entirety, and created a precedent that sequestration's consequences ought to be addressed by moving funds around -- not by raising the revenue, which is fiercely opposed by Republicans.

The legislation leaves in place sequestration's domestic spending cuts, which disproportionately impact the poor, and its defense cuts which have significantly reduced government purchases.

In a memo to House Republicans Friday, Majority Leader Eric Cantor basked in victory.

"As a CQ / Roll Call reporter tweeted last night, "Make no mistake, this FAA fix is a complete, utter cave by Senate Democrats and, if signed, by the White House,"" he wrote.

This is a sentiment expressed in other press reports over the last 12 hours, including, Politico: "Democrats blink first on aviation" and Chicago Tribune: "White House Scrambles For Damage Control."

...By the first of this week Senator Reid proposed replacing the whole sequester with phony war savings. And by last night, Senate Democrats were adopting our targeted "cut this, not that" approach. This victory is in large part a result of our standing together under the banner of #Obamaflightdelays.

"It's clear there's too much Wall Street in this administration," he told me during a Thursday interview in his Capitol Hill office.

Obama's Treasury department is just as unfriendly to the idea of breaking up big banks, or limiting their destructive potential, under Jack Lew as it was under Timothy Geithner, Brown said.

He was particularly unhappy with a recent speech in which Treasury undersecretary for domestic finance Mary Miller argued that the Dodd-Frank Wall Street reform bill already addressed the Too Big To Fail problem.

But Brown, and strange bedfellow Sen. David Vitter (R-LA), are pressing ahead anyhow with a new bill to impose much stricter capital requirements on megabanks, which they define as institutions with over $500 billion in assets.

Thus far, there's no obvious legislative vehicle for Brown's bill. "It's not going to be law by this summer," he acknowledged. But an ideologically diverse set of elite opinion and policymakers are coming around -- suggesting an easier legislative push than at any point since Congress passed Dodd-Frank.

"It's Peggy Noonan and George Will writing about it. It's [Fed Board member] Dan Tarullo and [former FDIC director] Sheila Bair speaking about it regularly. It's [Dallas Fed Chair] Richard Fisher and [former Kansas City Fed Chair] Tom Hoenig instructing us you better do something," Brown explained. "We're in a much better place today in terms of this bill advancing than we were a year ago."

His bill would, he claimed, do more than stabilize the financial system and protect the economy from another 2008-style crisis -- it would also dilute these institutions' political power, which they're currently using to delay and weaken other key regulations.

"These six banks are from $600 [billion] to $2.2 or $2.3 trillion in assets, and you know it's really ... way more than the economic power these six banks have. It's also the political power they have. The power to slow down the rules coming out of Dodd-Frank," he said. "If we do nothing here and things continue -- these six banks will have 65 then 70, who knows what percent of GDP their assets will represents. Their political power and their economic power go together."

And if House Republicans eventually relent and agree to return to the normal budget process, it will become relevant once again.

The report addressed and largely affirmed a key criticism of an inflation measure called Chained CPI, which among other things would reduce Social Security cost of living increases and kick people into higher income tax brackets, if adopted across the government.

The implicit finding: Chained CPI -- which President Obama included as a compromise measure in his budget -- will typically harm seniors more than the rest of the population.

The most common criticism of Chained CPI dismisses the technical accuracy of Chained CPI as an inflation index and points out that benefit cuts and regressive tax increases are undesirable policies, whether they're effectuated directly or via a technical change to tax and benefit calculations.

But there's another. In last week's report, CBO examined an experimental inflation measure called CPI-E, which weights health care and other goods and services more heavily than existing measures of inflation because seniors consume them disproportionately.

What they found is that over the last 30 years, inflation as measured by existing consumer price indices has typically been lower than inflation as measured by CPI-E.

In other words, prices rise faster for seniors than for the population at large -- which means slowing the growth of cost of living increases will particularly disadvantage seniors, who are already seeing their living costs outstrip their benefits.

"The possibility that the cost of living may grow at a different rate for the elderly than for the rest of the population is of particular concern in choosing a price index for Social Security COLAs because Social Security benefits are the main source of income for many older people," CBO writes.

For the past few years, this phenomenon has reversed, thanks in large part to the slowing growth of health care costs and the collapse of housing prices. But that's likely temporary.

"CBO ... anticipates that the CPI-E will outpace the CPI-U in the future."

The budget office issues some caveats, though, including the inherent difficulties measuring the prices people pay for health care, and accounting for health care quality improvements. Likewise, they suggest modifying CPI-E to take into account the substitution effect.

"If policymakers believe that the CPI-E is an appropriate measure of inflation for the elderly, they could use it to index programs that serve that population," CBO explains. "A chained version of the CPI-E could also be developed to better account for economic substitution by older consumers, but doing so would require collecting significantly more data about the purchasing patterns of the elderly."

In a letter to Hensarling, Waters points out that no court has invalidated Cordray's appointment, and that Hensarling himself has acknowledged as much in prior correspondence with the consumer agency.

"As you conceded in correspondence with the CFPB, no court has addressed the legitimacy of the President's appointment of Director Cordray," Waters writes.

You can read the full letter below.

Maxine Waters Letter to Chairman Hensarling Re Cordray Testimony 04-23-2013

Rep. Jeb Hensarling (R-TX), the chairman of the House Financial Services Committee, which enjoys jurisdiction over regulatory bodies like the CFPB, says he lacks the legal authority to invite the recess-appointed director of the CFPB, Richard Cordray, to testify on behalf of the agency.

"By law, the committee can receive this testimony only from a director who is appointed in accordance with the Constitution and the Dodd-Frank Act, which created the bureau," said Hensarling.

The D.C. Circuit Court of Appeals held that President Obama exceeded his recess appointment power when he named three members to the National Labor Relations Board over one year ago. Obama cited the same power when he placed Cordray at the helm of CFPB simultaneously.

"The court's unanimous ruling makes it clear that there is no legally-appointed director of the CFPB at this time," Hensarling said. The expansive ruling would actually invalidate nearly every exercise of the recess appointment power.

Deepak Gupta, former Senior Counsel at CFPB and founder of the Gupta Beck law firm takes issue with Hensarling's argument.

"This is a truly preposterous political stunt. It's hard to see what it will accomplish, other than adding more bluster to the fight over the CFPB," Gupta tells TPM by email. "[I]t's of course true that the D.C. Circuit's decision has called President Obama's recess appointments into question. But no court has actually ruled on Cordray's appointment. Until that happens, he is the Director of the Consumer Financial Protection Bureau -- both legally and in fact.... Why not let him testify about the job he's actually doing?"

Cordray has of course testified before the Financial Services Committee several times. But Hensarling is now officially calling his legitimacy into question, and will not invite him to testify again until he's confirmed -- something Senate Republicans say will not happen unless Democrats agree to statutorily weaken the agency.

In the meantime, Hensarling promises to continue his oversight by inviting more junior employees of CFPB to testify in Cordray's stead.

This post has been updated

That means certain statements Tsarnaev makes to interrogators prior to being advised of his Miranda rights will nonetheless be admissible in court.

People began speculating that the FBI might avail itself of this exception from the moment Tsarnaev was found alive and taken into custody. But almost as quickly, we heard law enforcement officials give Boston an effective 'all clear' and learned that Tsarnaev was headed to the hospital in serious condition.

In other words, officials conceded the public safety was not in imminent jeopardy, and in any case Tsarnaev wouldn't be answering questions until after he received some extensive medical treatment. So why is a public safety exemption applicable -- why wasn't Tsarnaev read his Miranda rights, assuming he was coherent, from the get go?

"There may be exceptional cases in which, although all relevant public safety questions have been asked, agents nonetheless conclude that continued unwarned interrogation is necessary to collect valuable and timely intelligence not related to any immediate threat, and that the government's interest in obtaining this intelligence outweighs the disadvantages of proceeding with unwarned interrogation," the memo reads.

The memo even contemplates a suspect just like Tsarnaev: "[A]n operational terrorist is an arrestee who is reasonably believed to be either a high-level member of an international terrorist group; or an operative who has personally conducted or attempted to conduct a terrorist operation that involved risk to life; or an individual knowledgeable about operational details of a pending terrorist operation."

As Slate author and attorney Emily Bazelon notes, the FBI -- and if possible, the Justice Department -- determine when the exemption is applicable without oversight. When they applied it to underwear bomber Umar Abdulmutallab, they interrogated him for 50 minutes before advising him of his Miranda rights. He stopped talking and demanded an attorney.

But that doesn't mean the FBI is operating in lawless territory between the moment of capture and the Miranda reading. "[O]nly those questions necessary for the police 'to secure their own safety or the safety of the public'" are permitted under the public safety exception, according to the FBI. Likewise "Voluntariness is the linchpin of the admissibility of any statement obtained as a result of government conduct," and "statements obtained by the government under the public safety exception cannot be coerced or obtained through tactics that violate fundamental notions of due process."

If a court believes these protections have been breached, it can declare the resulting evidence inadmissible.

By the same token, Miranda rights aren't conferred on a suspect at the moment an officer of the law reads them to him. They're fundamental. And if Tsarnaev awakes in the hospital aware that he doesn't have to say anything, and demands an attorney, the FBI ultimately can't deny him one.

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