TPM News

Obama Giving Economic Speech Today, While Administration Warns Of More Immediate Bad Times President Obama will be giving a speech on at the economy at Georgetown University, at 11:35 a.m. ET. Obama will discuss the steps his administration has taken to fix the economic crisis. At the same time, the administration are hedging their rhetorical bets and bracing the country for less than stellar news. Appearing on NBC's The Today Show, economic adviser Christina Romer said that there are "small little signs that maybe some parts of the economy are stabilizing," but also that there will likely be "several more months of job losses."

Report: Obama To Tap Fannie Mae's Herbert Allison To Administer TARP The Washington Post reports that the Treasury Department plans to tap Fannie Mae CEO Herbert Allison to run the financial recovery program. Note that Allison became head of Fannie Mae after the government took it over this past September, and would be replacing the current Bush-appointed TARP head Neel Kashkari.

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The Coleman campaign released this statement after the election court ruled that Al Franken won the election, making it clear that they're appealing:


Statement from Ben Ginsberg, legal spokesman for the Coleman for Senate campaign:

"More than 4,400 Minnesotans remain wrongly disenfranchised by this court's order. The court's ruling tonight is consistent with how they've ruled throughout this case but inconsistent with the Minnesota tradition of enfranchising voters. This order ignores the reality of what happened in the counties and cities on Election Day in terms of counting the votes. By its own terms, the court has included votes it has found to be 'illegal' in the contest to remain included in the final counts from Election Day, and equal protection and due process concerns have been ignored. For these reasons, we must appeal to the Minnesota Supreme Court so that no voter is left behind."

Meanwhile, the DSCC put out this statement that Franken should be allowed to get to work:


U.S. Senator Robert Menendez, chairman of the Democratic Senatorial Campaign Committee released the following statement:

"The people of Minnesota have many reasons to be proud tonight, not the least of which is knowing they have one of the best election systems in the entire country. A thorough election contest upheld the result of a meticulous recount. Al Franken won the election, Al Franken won the recount, Al Franken won the contest, and now Al Franken should be allowed to get to work for the people of Minnesota."

At a press conference just now, outside his home in Minneapolis, Al Franken again declared victory in his campaign for the U.S. Senate, after the election contest court ruled that he was the winner of this race. (Special thanks to our good friends at The Uptake for carrying the live stream.)

"I am, of course, incredibly gratified by today's ruling and grateful to the judges," said the apparent Senator-elect, "to our legal team and most of all to Minnesota's civil servants, elected officials and citizen volunteers who have taken so much time, and taken so much effort over the last several weeks and months to make sure that the votes were accurately counted."

And one point he stressed repeatedly, was that he should finally be allowed to get to work in Washington. "It has been more than five months since Election Day, and more than three months since the winner of this election was supposed to be sworn in to go to work for the people of Minnesota. This long delay in the seating of Minnesota's second U.S. Senator has come at a time when our state badly needs help from Washington."

Franken also quoted his old friend Paul Wellstone -- the man whose death in a 2002 plane crash so clearly affected Al and inspired him to become truly serious about politics, to the point of spending years of his life running for his late friend's political office. After discussing all the problems the country faces, and the reasons he got into the race and why his supporters fought so hard, Franken said: "It's like what Paul Wellstone always said: Politics isn't about winning, it's about improving people's lives."

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As you've probably heard, the Minnesota election court has just handed down their very much-awaited ruling: That Al Franken was the rightful winner of the most votes in the 2008 Senate election, and he is entitled to receive the certificate of election.

To make a long story short, the court -- who, by the way, are a rare tri-partisan selection of judges -- rejects pretty much every single argument that Team Coleman put forward, and either accepts all of Team Franken's arguments as is or in a somewhat modified form.

So where do we go from here?

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Here's a good question as the seven-judge Minnesota Supreme Court gears up for an expected appeal from Norm Coleman, who is nearly certain to lose the election trial: Just how many justices will be left to hear it?

As it is, it already seems like two justices are solid bets to recuse themselves: Chief Justice Eric Magnuson and Associate Justice Barry Anderson, who served on the special state canvassing board, and previously recused themselves in state Supreme Court proceedings in this case, when the court addressed questions such as rejected absentee ballots and when a certificate of election could be granted.

But now we know that Justice Christopher Dietzen has donated money to Norm Coleman -- the checks were written over five years ago, before Dietzen first became a judge -- should he recuse himself? He's already participated in the other litigation listed above, and in all fairness he didn't seem to be biased.

And this one isn't quite so solid, but some people might wonder whether Associate Justice Alan Page should recuse himself, because he appointed the three-member trial court. (That job originally would have gone to the Chief Justice -- but he'd recused himself, leaving it to Page as the most senior associate justice.)

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Another day, another group of American taxpayers forced to cough up tens of millions of dollars to Wall Street over a little-noticed provision in a "swap" contract gone sour. Last week we brought you the parallel tales of sudden budgetary meltdown in Tennessee, Alabama, Illinois, New Mexico and Philadelphia that in part prompted the credit rating agency Moody's to issue a blanket negative credit outlook on all bonds issued by American cities and towns. Today it's the Indianapolis Water Authority being screwed in a swap deal that might force the utility -- and by extension, its customers -- to cough up a collateral call of as much as $100 million.

The deal is a familiar one: in 2005 the city of Indianapolis refinanced $550 million in fixed-rate bonds to raise money to fund its acquisition of its old water company from the private utility company NiSource, which agreed to sell it as a condition of regulatory approval of its merger with Columbia Energy Group. The deal involved the ailing bond insurer MBIA as well as a similar German-Irish firm called Depfa Bank, which insure the utility's ability to pay up by writing credit default swaps on municipal bonds that protect investors in the event of default. But as Barney Frank pointed out last week, the risk of municipal bonds defaulting is historically minimal -- while the risk that MBIA and Depfa might default was steadily rising as they began to chase the riskier (AIG-dominated) business of writing swaps on collateralized debt obligations. And when those "insurers" started to see their credit downgraded last year, suddenly it was municipalities like Indianapolis that were swamped with calls demanding collateral -- which translates to a major refinancing being funded by an emergency 17.5% rate hike this summer.

If you're having trouble getting your head around how this works, it's a little like this: in order to get a cheaper interest rate on your mortgage, you pay you bank extra for a "swap" insuring the investors who buy the mortgage in the case of your default. But then the bank that originated the mortgage starts making riskier loans and its credit rating agencies downgrade its debt, it turns out the owner of your mortgage can demand collateral from you. Except in the case of municipal bonds, the homeowners are cities and towns with the legal authority to tax citizens and an infintessimal record of actually defaulting -- and the banks were using your interest payments to extend home loans to unemployed high school dropouts and senile 80-year-olds living on Social Security.

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We haven't had much to say about the now-resolved pirate hostage situation off the coast of Somalia. It's not really our bailiwick. But much of the rest of the media has been All Pirates All The Time for the last several days, and since the stand-off was resolved by the Navy at a time when the administration is trying to overhaul the U.S. military, the spending cut meme was destined to rear its ugly head:

At a time when the president is trying to trim the Pentagon budget, the political consequences for Obama could have been dire. Instead, he's presiding over a triumphant rescue.
Needless to say, none of the administration's proposed changes involves reducing the ranks of the Navy SEALs, whom we have to thank for staging the rescue.

A new Gallup poll finds a surprising attitude among the American people regarding taxes, as we head towards April 15: Amazingly high satisfaction.

The question asked is: "Do you consider the amount of federal income tax you have to pay as too high, about right, or too low?" The numbers: About right 48%, too high 46%, and too low 3%.

This is the second-highest "about right" number since Gallup began asking this question over 50 years ago, beat out only by 50% in 2003, after successive rounds of Bush tax cuts. And since the early 1960s, this question has almost always shown a significant gap between "too high" on top and "about right" on the bottom.

Vito Fossella, the former GOP congressman from Staten Island, NY, has pleaded guilty to DUI charges, the Associated Press reports -- and according to his lawyer, the decision was prompted in part by the death of a Major League Baseball player last week.

Fossella was arrested May 1, 2008, and charged with driving while drunk. The arrest led to revelations that he had fathered a child as part of an extra-marital affair. He served out his term, but did not run for reelection this fall. He was convicted in October, but was appealing his conviction.

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