In it, but not of it. TPM DC

Discussing his budget outline, President Obama just sent a nice shot across the bow of his erstwhile Commerce Secretary nominee, Sen. Judd Gregg (R-NH), who has rolled out some eye-poppingly hyperbolic metaphors to describe the administration's budget options.

"The critics tend to criticize, but they don't offer an alternative budget," Obama just quipped.

And wouldn't you know it, Gregg is the senior GOPer on the Senate Budget Committee ... and his side won't be offering an alternative budget this year. (House Republicans, by contrast, are taking that plunge.)

Under questioning from the AP's Jennifer Loven tonight, President Obama predicted "strong support from the American people and from Congress" for giving the Treasury Department and Federal Reserve sweeping new powers to take over and wind down insolvent financial institutions.

Obama pitched the change as necessary to avoid a regulatory vacuum in case another major financial firm implodes in the manner that AIG did.

"Understand that AIG is not a bank," Obama said. "If it were a bank and effectively collapsed, the FDIC could step in as it does with a whole host of banks ... and in a structured way, renegotiate contracts" with counter-parties and employees.

But the FDIC, which steps in to dispose of insolvent banks such as IndyMac, is a different political animal than the Treasury and Fed, both of which have fallen out of favor with Congress thanks to the bailout's rocky path.

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When Rep. Michele Bachmann (R-MN) talks, people listen -- even if they're not entirely sure what they're hearing.

I've now discovered at least three examples of a curious phenomenon: The Bachmann Effect. When Bachmann is out there talking about the issues in an adversarial setting, her opponents find themselves on a very unsure footing -- mainly because they're shocked and befuddled to hear what she's saying.

Check out these three examples, in reverse-chronological order:



The first was from today's Financial Services hearing, when she demanded an answer from Tim Geithner as to what the constitutional basis was for his actions in the bailout. The second is from a debate this past October with her Democratic opponent El Tinklenberg. And the third is from an appearance on Larry King Live during the Republican Convention, in a peculiar exchange with James Carville.

These three individuals don't know each other, and yet on three separate occasions you'll see the exact same facial expression each time.

The Service Employees International Union (SEIU) and Change to Win are also vowing to press on with their work on the Employee Free Choice Act despite Sen. Arlen Specter's (R-PA) momentum-killing announcement today that he would oppose the union-organizing bill.

SEIU President Andy Stern says he's "dismayed by those who say they support the democratic process, yet refuse to allow meaningful debate and a democratic vote on critical legislation like the Employee Free Choice Act," while Change to Win takes a more diplomatic approach in responding to Specter. Both groups' statements are after the jump.

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President Obama will speak at his press conference tonight about the progress that has been achieved in combatting the financial crisis, and his commitment to getting through the problems by making sure that everyone works together, according to pre-released excerpts of his opening statement.

Key quote:

We will recover from this recession. But it will take time, it will take patience, and it will take an understanding that when we all work together; when each of us looks beyond our own short-term interests to the wider set of obligations we have to each other - that's when we succeed. That's when we prosper. And that's what is needed right now. So let us look toward the future with a renewed sense of common purpose, a renewed determination, and most importantly, a renewed confidence that a better day will come.


Full excerpts after the jump.

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The two Senate campaigns in Minnesota -- if they can be called campaigns almost five months after the election -- may very well have struck gold all over again, thanks to a new FEC advisory opinion from yesterday.

The opinion will allow donors who want to help Franken and Coleman to donate up to $30,400 to special recount funds -- even if they'd already maxed out to the regular party committees or to Franken and Coleman's regular campaign funds.

So if Norm Coleman or Al Franken suddenly needed a half-million dollars, for example, all it would take is less than 20 super-wealthy individuals, willing to max out for the cause -- not too shabby.

Professor David Schultz of Hamline University explained to TPM that this can allow Coleman to take in amounts of money he simply couldn't get before. "If the ruling had gone the other way he would have had to go out and find a bunch of new donors," Schultz explained. "With this ruling, he at least the opportunity to go back and tap his previous donors."

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AFL-CIO President John Sweeney just released a statement responding to Sen. Arlen Specter's (R-PA) announcement that he would oppose the labor-backed Employee Free Choice Act -- and the labor chief isn't backing down from the "death blow" framing that's already being applied to today's news.

In fact, Sweeney's remarks are all the more cutting because of their high-minded commitment to keep amassing support for the Employee Free Choice measure, which is labor's No. 1 priority for the year and would broadly ease union-organizing rules. No matter how you look at it, Specter can forget about getting the state AFL-CIO's endorsement for the second straight election cycle.

Sweeney's full statement is posted after the jump.

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The House's official budget resolution will be posted on its Budget Committee website at 10:30am tomorrow, but its crucial details are already known on the Hill.

As I mentioned earlier, the filibuster shield known as "reconciliation" will be invoked by the House on a time-dependent basis for health care reform, but not used in the Senate. The House budget is also set to "save money" by not permanently indexing the alternative minimum tax (AMT) to inflation -- and I put that phrase in quotes because Congress inevitably adjusts the AMT every year, but never attempts a permanent AMT fix for fear of acknowledging its huge impact on the deficit.

The AP refers to this fuzzy tax math near the bottom of its budget story today:

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Sen. Jim Bunning (R-KY) is continuing to attack his fellow Kentucky Senator Mitch McConnell, the Senate GOP leader, along with NRSC chairman John Cornyn for seemingly trying to force him out of office -- and he's not too fond of the media coverage, either.

Bunning pointed out that Mitch McConnell is already raising money for his 2014 re-election campaign, crowding out dollars that could have gone to Bunning in 2010 -- compared to Bunning's own act of standing down in the money race during McConnell's 2008 campaign: "Just as I refrained from doing it for two years, he sent out his, so you know where he stands."

And there's also the way that McConnell and Cornyn have met with state Senate President David Williams about a possible primary challenge: "When they recruit someone to run against you in a primary, it puts doubt in people's minds that you are going to finish the race. Therefore, they're waiting and waiting and waiting. It's almost a self fulfilling prophecy."

And Bunning also took serious issue with a recent story in the Louisville Courier-Journal, which reported that he was threatening to resign and give his state's Democratic governor the power to appoint his replacement.

Bunning complained that "he Courier-Journal doesn't need anything, no facts, no figures. So go ahead and write it. Three sources, my ass. Pardon me if there's ladies on."

Elijah Cummings has driven a lot of news about the AIG bonus scandal, but he's got tentacles deep in other controversial aspects of the $180 billion bailout. He's currently circulating (and I have obtained) a letter to colleagues, seeking their support for a TARP inspector general investigation into every aspect of the payments AIG made, with government money, to counterparties whose risky investments it had insured.

Goldman Sachs claimed in September that they had no material exposure to AIG; however, after AIG released the counterparty information on March 15, we found out that Goldman Sachs received almost $13 billion in counterparty payments. The Special Inspector General for the Troubled Assets Relief Program was created to ensure that transparency and accountability stay firmly rooted in the government's efforts to revive and sustain the American economy. This letter proposes that the Special Inspector General examine the nature of the counterparty payments - including the recipients, the process by which they were made whole, and the justification, if any, for that level of payment.


He's asking members of Congress to cosign a letter to the inspector general asking him to conduct a thorough inquiry. We've been all over the counterparties controversy and we'll follow this campaign as far as it goes.

Full text of the letter below the fold.

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