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When President Obama submitted a budget that predicted passage of a revenue-raising climate change bill, hopes rose that Congress could successfully rein in carbon emissions this year.

But a cap-and-trade climate bill is almost certain to be filibustered by Republicans -- and in a letter delivered to the Senate Budget Committee yesterday, eight Democratic senators joined 25 Republicans to defend the GOP's right to set a 60-vote margin for passing emissions limits.

"We oppose using the budget process to expedite passage of climate legislation," the senators, including eight centrist Democrats, wrote in their missive.

Using the procedure of budget reconciliation, which would allow a climate change measure to become law with 50 votes while preventing filibusters, "would circumvent normal Senate practice and would be inconsistent with the administration's goals of bipartisanship, cooperation, and openness," the 33 senators wrote.

Budget reconciliation was used by George W. Bush and congressional Republicans to prevent Democrats from stalling both the 2001 and 2003 tax cuts. The opposition of nearly one-half of the Senate, however, means that President Obama's party will have little room to use the tactic as successfully as Bush's supporters did.

Filibuster-proofing the upcoming health care reform bill through reconciliation already has been ruled out strongly discouraged* by pivotal Democratic senators on the Finance Committee, Chairman Max Baucus (D-MT) and Jay Rockefeller (D-WV).

Democrats' reluctance to take advantage of their procedural arsenal to pass climate change and health care this year doesn't mean that both pieces of legislation would necessarily fall to filibusters. But it does mean that Republicans will have significantly more opportunities to insert pro-business provisions into these pivotal bills. Late Update: The eight Democratic senators who signed on to the letter are Robert Byrd (WV), Blanche Lincoln (AR), Ben Nelson (NE), Evan Bayh (IN), Mark Pryor (AR), Bob Casey (PA), Carl Levin (MI), and Mary Landrieu (LA).

*Late Late Update: Baucus has not ruled out reconciliation entirely. As he told the Kaiser Family Foundation last week, "I am doing whatever I can to avoid reconciliation [on health care] and don't take it off the table totally, because it is a backup.

It's fair to say that the incompetence and fecklessness of the SEC in failing to catch Bernie Madoff's $50 billion Ponzi scheme (merely "alleged" no more!) has already been pretty well established -- by this guy, among others.

But if anything, Madoff's courtroom confession delivered yesterday only makes the extent of the SEC's screwup even more startlingly clear.

Here's what Madoff said:

To conceal my fraud, I misrepresented to clients, employees and others, that I purchased securities for clients in overseas markets. Indeed, when the United States Securities and Exchange Commission asked me to testify as part of an investigation they were conducting about my investment advisory business, I knowingly gave false testimony under oath to the staff of the SEC on May 19, 2006 that I executed trades of common stock on behalf of my investment advisory clients and that I purchased and sold the equities that were part of my investment strategy in European markets. In that session with the SEC, which took place here in Manhattan, New York, I also knowingly gave false testimony under oath that I had executed options contracts on behalf of my investment advisory clients and that my firm had custody of the assets managed on behalf of my investment advisory clients.

And here's how the SEC -- in a memo that recommended closing that inquiry, having found only minor violations -- what appears to be that same piece of testimony:
[I]n the course of a preliminary inquiry into [Markopolos' allegations that Madoff's hedge fund profits were the result of fraud], the staff learned that during a recent examination of BLM by NERO's broker-dealer examination staff, Bernard Madoff, the sole owner of BLM, did not fully disclose to the examination staff either the nature of the trading conducted in the hedge fund accounts or the number of such accounts at BLM.

But of course, it wasn't that he didn't fully disclose the trading information. It's that he wasn't even making any trades, and had directed his staff to create false tickets to fool investors. Presumably, that deception could have been detected had the SEC simply bothered to try to match up those trade with the supposed counter-parties -- who didn't exist.

The SEC had another chance to catch that scheme when Madoff filed reports with the agency that year. Madoff said yesterday:
Another way that I concealed my fraud was through the filing of false and misleading certified audit reports and financial statements with the SEC. I knew that these audit reports and financial statements were false and that they would also be sent to clients. These reports, which were prepared here in the Southern District of New York, among things, falsely reflected my firm's liabilities as a result of my intentional failure to purchase securities on behalf of my advisory clients.

"Were there sufficient red flags for SEC to have caught this?" asked Ross Albert, a former SEC senior special counsel, asked in an interview with TPMmuckraker last December. "Absolutely, without a doubt."

Since then, that conclusion has become only more indisputable. And the case for those additional SEC funds has grown only stronger.

In yet another indication that Joe Lieberman is going out of his way to patch things up with the Democratic Party, The Hill reports that Lieberman is floating the idea of running for re-election in 2012 -- as a Democrat.

Lieberman said that friends have asked him whether he might go back fully to the Democratic Party. "I'm an independent Democrat, and that gives me options," said Lieberman. However, he did caution against assuming that his praise of President Obama and his work within the Democratic caucus mean he will ultimately rejoin the party: "I wouldn't reach that conclusion."

The new Quinnipiac poll from earlier this week suggests that Lieberman would have a very hard time in a Democratic primary. Among Democratic voters, his approval rating is at only 32%, with 61% disapproval. And another Quinnipiac poll from a month ago tested Lieberman as an independent in a general election against Democratic state Attorney General Richard Blumenthal, with Blumenthal winning by a 58%-30% landslide, with an 83%-9% margin among Democrats alone.

But there's no denying that a lot can happen in a three and half years. In 2008 alone, for example, Lieberman travelled the country and vociferously attacked Barack Obama and the Democratic Party. And look at him now.

Sir Allen Stanford's alleged $8 billion Ponzi scheme doesn't only affect his American investors. In the Antiguan election this week, voters chose between the ruling party and the opposition, which welcomed the Texas financier to Antigua twenty years ago. The economy is the central issue in the election, as Antigua's Stanford International Bank was shut down by Caribbean regulators due to the Stanford fallout.* Prime Minister Baldwin Spencer says his opponent, Lester Bird, tried to "literally give away Antigua and Barbuda to Allen Stanford." In 2006, Byrd used his power as a former Prime Minister to nominate Stanford for a knighthood.* Election results are expected today. (Associated Press)

Sam Zell, the chairman and CEO of the newspaper conglomerate Tribune Co. hired a high-profile lawyer to represent him in an interview with the U.S. Attorney's office about possible connections to former governor Rod Blagojevich, the company said Wednesday. Zell's lawyer, Anton Valukas, specializes in white collar crime and has represented law firm Jenner & Block in a number of major cases. Among other charges, federal prosecutors have accused Blagojevich and his chief of staff John Harris of threatening to withhold public support from the sale of Wrigley Field, which is owned by Tribune Co., if the company did not fire members of the Chicago Tribune editorial board. (Chicago Tribune)

A report released by the Government Accountability Office today says Medicare home services spending increased 44 percent over five years due partially to fraud and abuse. Medicare home care services include visits by nurses and physical therapists for Medicare patients. Some lawmakers say that lax oversight enabled providers to take advantage of the system to bill for services they did not provide. Chuck Grassley, the top Republican on the Senate Finance Committee, harshly criticized Medicare oversight as it currently stands. "There's no excuse for Medicare officials neglecting payment problems," the Iowa senator told USA Today. The GAO report recommends implementing criminal background checks on home services providers to reduce cases of fraud. (USA Today)

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Florida GOP Chairman Defends Steele, Blasts Critics Florida Republican Party Chairman Jim Greer has sent a letter to RNC members, defending Michael Steele -- and lambasting his critics: "What I find so disturbing is that some Republicans cannot see the absolute necessity of providing unwavering loyalty and support to Chairman Steele as he embarks upon leading the Republican Party into the future."

Steele Hires Chief of Staff For RNC The RNC announced that Michael Steele has hired Ken McKay, former campaign manager and chief of staff to Rhode Island Governor Don Carcieri, to be the new RNC Chief of Staff. One of the criticisms of Steele in the last month and a half is that he has been slow to fill the key staff positions, but he is now starting to make progress on that front.

Obama's Day Ahead: Focusing On The Economy President Obama is having a closed meeting with Economic Recovery Advisory Board Chairman Paul Volcker at 12 p.m. ET. At 12:45 p.m. ET, he will deliver remarks from the Oval Office on the economy. At 1:15 p.m. ET he is meeting with Vice President Biden for lunch.

Biden Promoting Stimulus With Dem Members of Congress -- And Specter Vice President Biden will be administering the oath of office to Secretary of Labor Hilda Solis this morning. At noon, he will head up an event at Union Station to announce funding for Amtrak as part of the stimulus program. Others in attendance include Democratic members of Congress such as Senators John Kerry, Jay Rockefeller, Frank Lautenberg and others -- plus Republican Senator Arlen Specter.

Big Day In Minnesota: Closing Arguments Closing arguments in the Minnesota election trial are scheduled for today. Each side will have an hour at bat to make their final case to the judges. After that, the judges are expected to spend two to three weeks working on a determination of who has legally won the most votes, and is entitled to the certificate of election -- a decision that is likely to be appealed.

WaPo: U.S. Attorney Situation Remains Unclear The Washington Post reports that the Obama Administration faces some very complicated choices in appointing new U.S. Attorneys, between the interest of appointing their own people versus the need in some cases to keep current Attorneys in places to pursue pending cases. Perhaps the most controversial example involves Mary Beth Buchanan, a conservative U.S. Attorney from western Pennsylvania who is quite publicly refusing to resign.

Virgil Goode Files Papers For Potential 2010 Comeback Bid Former Congressman Virgil Goode (R-VA), who was defeated in a huge upset by Democrat Tom Perriello by a margin of 727 votes out of over 315,000 in 2008, has filed papers to run again in 2010. Goode is perhaps best known for denouncing the election of Rep. Keith Ellison (D-MN), the first Muslim member of Congress.

Another fun detail to the story about the Coleman campaign's breach of online donors' credit-card data -- which was caused after the site's entire unencrypted database was briefly posted online in late January.

The campaign's FAQ page about the breach -- which promises that the individuals who stole this information will be prosecuted to the fullest extent of the law, and urges any concerned supporters to cancel their credit cards -- ends with a solicitation to send more money:

Of course, the donation has to be sent by snail-mail, or made with a credit card over the phone, because they've had to take down their Web site's credit-card functionality.

On a conference call with reporters just now, lead Franken attorney Marc Elias celebrated the imminent closing arguments tomorrow. "This is truly not only a historic recount and election contest in its size and the long period of time that it's gone on, but also in its thoroughness," said Elias. "And the people of Minnesota and all the people of the United States can take a great deal of confidence and pride in the process that has gone on for the last nearly five months."

I asked about the intriguing possibility raised to me by Professor David Schultz of Hamline University -- that the Franken camp could potentially use the loser-pays provision of the election-contest law to stop any appeal from Coleman, by forcing his campaign committee to come up with millions of dollars to be placed in escrow to cover Franken's attorney's fees before any appeals continue.

"You know I've gotten a number of questions over the course of the last five weeks about the cost-shifting provision of the law," said Elias. "And in honesty I'll give you the same answer now I've given before, which is I have not spent really any time looking at it. I will now have a chance, now that the evidence is closed, to now look to the next step in this, which would be what happens post-decision by the court. But I will take a look at that and probably be in a better position to answer that in the next few days."

It seems that the mystery of the holds on two of President Obama's senior science advisers has been solved.

All attempts to delay John Holdren, nominated to lead the White House science and technology office, and Jane Lubchenco, nominated to lead the National Oceanic and Atmospheric Association, were lifted this afternoon after a closed-door meeting of the Senate Commerce Committee, according to Greenwire.

Why the Commerce panel needed to vote on Holdren and Lubchenco again after affirming them once last month remains unknown, as do the identities of the holders whom we've been working to unmask.

Greenwire reports that Sen. Kay Bailey Hutchison (R-TX), the senior GOPer on Commerce, pointed a finger at Democrats for slowing the nominees to win concessions on other issues. Hutchison told me earlier this week that she was unaware of any objections -- we'll let you know more as soon as we know.

Late Update: Here's why the committee had to meet again this afternoon ... CQ's original report that stated Holdren & Lubchenco were "approved" last month was incorrect. The nominees were actually "discharged," which in Senate parlance means that they were quickly cleared without the panel voting.

That seems to have made the duo a magnet for senatorial objections -- the source of which remains murky, even to folks in the Senate. Now that the committee has met again to give the official stamp of approval to Holdren & Lubchenco, however, they can be moved towards unanimous approval without further shenanigans.

Tomorrow is going to be a big day in the Minnesota trial: Closing arguments, which will then bring this whole phase of the court proceedings to an end, pending a ruling and subsequent appeals. And what happens next could be very long -- or not.

Lead attorney Joe Friedberg will do the closer for the former Republican Senator, and Franken attorney Kevin Hamilton will be delivering closing arguments for his side.

So what happens next? Hamline University professor David Schultz tells TPM that he now expects the court to probably rule at some point in the first week of April, with a declaration that Al Franken is the winner. From there, this goes into an appeals process at the state Supreme Court that could take perhaps two months -- and then there are the federal courts. So this could take from anywhere between early April, assuming no appeals, to all the way through Labor Day, with June as the ballpark middle figure.

"The lakes'll be fully melted before we have a U.S. Senator -- which is the opposite of when Hell freezes over," said Schultz. "Maybe when Hell thaws out, something like that."

On the other hand, Schultz poses a very interesting scenario, one that could bring the entire appeals process to a crashing halt and force the granting of a certificate of election.

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This doesn't look good....

The New York Times reports that last September, Rep. Maxine Waters (D-CA) set up a meeting with Treasury Department bank regulators for several minority-owned banks, including OneUnited, one of the nation's largest black-owned banks. At the meeting, OneUnited's CEO, Kevin Cohee, bluntly asked the officials for $50 million in bailout money.

But what Waters didn't disclose was that her husband, Stanley Williams, had served on the bank's board of directors until early 2008, and has owned at least $250,000 in stock in the bank. Treasury learned that fact only later.

One official told the Times:

"It angers me. You got to know you have to be careful when you are dealing with people who you have personal relations with.

In the end, OneUnited didn't get that $50 million, but it did get $12 million in TARP funds, becoming the first minority owned bank to cash in through the program.

This is hardly the first allegation against OneUnited. Adds the Times:
[I]t had been harshly criticized by regulators in 2007 for failing to give a sufficient number of loans to lower income residents in Miami, while favoring wealthier customers there.

[T]he F.D.I.C. sanctioned the institution in October 2008 for "unsafe or unsound banking practices," including excessive compensation for Mr. Cohee. The bank had provided him with a 2008 Porsche SUV and maintained his $6.4 million beachfront compound in Santa Monica. Calif., with views of the Pacific and a spa and pool.

For his part, Cohee suggested to the Times that race is at the heart of the issue. "This is where the race issue comes in," he said.

The Wall Street Journal detailed some of the ties between Waters, who sits on the House Financial Services committee, and OneUnited, in a report (sub. req.) published earlier today.