Monthly Archive for July, 2011

Congress putting its faith in committee

After weeks, months, of bitter feuding, Congress has finally agreed on who cannot be trusted to solve the country’s complicated fiscal problems: The U.S. Congress. All 535 members. And Congress has a solution — a special committee.

Both Republicans and Democrats have proposed drumming up a committee of 12 legislators — handpicked by both parties — to deal with the most complicated issues involved in a likely debt-ceiling compromise. It will be up to this “super committee” to complete the epic task of cutting more than $1 trillion in spending from the federal budget.

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Book review: ‘Flashback,’ by Dan Simmons

Dan Simmons’s Flashback” is an abundantly entertaining, often outrageous right-wing fantasy about a weak, broken United States 20-odd years from now. The country is ruled over by the Japanese, lives in fear of the Islamic Global Caliphate, and its citizens mostly spend their time stoned on a drug called flashback that lets them escape to a better past. Some of the events that have occurred between now and the early 2030s can be summed up thusly:

U.S. Goes Bankrupt

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Pentagon contracts go global

It took Faun Trackway, a Welsh company that produces temporary roadways and landing strips, about 31 / 2 years of research before it decided to launch a U.S. business.

Company officials flew back and forth, visiting military installations and officials, exhibiting at trade shows, and getting to know the U.S. defense industry.

Last week, the company jumped in, opening the sales office of its independent U.S. business in the District. Even as the Pentagon warns of reduced spending, Faun Trackway is among those European contractors seeking opportunities in the United States, citing a market that is simply too big to pass up.

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College affirmative action back on Supreme Court’s horizon

When the Supreme Court in 2003 narrowly approved the consideration of race in public university admission decisions, it came with loads of restrictions and a sort of expiration date.

“We expect that 25 years from now, the use of racial preferences will no longer be necessary to further the interest approved today,” Justice Sandra Day O’Connor wrote for the majority in Grutter v. Bollinger .

But, of course, O’Connor is now retired from the court, replaced by Samuel A. Alito Jr., a justice far more skeptical of racial remedies. And two recent decisions in lower courts have raised the prospect that the issue will return to the high court far ahead of O’Connor’s timeline.

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Political Bestsellers — July 31, 2011

A shorter list this mid-summer weekend, a reflection, perhaps, of the deluge of vacations that Washingtonians begin taking just about this time of year (and well into August), and a preoccupation with the wearying budget debate on the Hill.

Though that disgust with the way Washington operates may explain the last book on this week’s list, a harsh critique of the Federal government and the way it spends money — your money. Certainly bashing government is all the rage nowadays, considering the budget / debt-limit debacle taking place even now on Capitol Hill, but alleging that there is a cadre of federal workers with exorbitant salaries ($170,00 is the number bandied about) “stealing you blind” is a bit much considering the vast majority of government workers are hardworking, conscientious folks making much less than you might think. And there’s no real reason why top-notch talent shouldn’t ear as much as some of their private sector counterparts, especially as a desire for more money is what leads many to leave the federal workforce in the first place. And as for “Stealing you blind,” it may be wise to turn your attention to the “recession-proof” moneymen of Wall Street and the often ridiculous salaries earned there — much of it lately at taxpayers’ expense.

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Can a giant platinum coin save our credit?

If Congress fails to resolve this debt crisis by Aug. 2, one tack President Obama could take is to simply declare the debt ceiling unconstitutional under the 14th Amendment. It’d be politically contentious, it’d set all sorts of dicey executive-power precedents, and the markets might judge it harshly. But plenty of legal types think the White House could get away with it.

But failing that, Obama could always just solve the crisis with a pair of magical platinum coins. Sure, that sounds preposterous, but Yale’s Jack Balkin argues that this is actually a perfectly legal strategy. Here’s the logic: Under law, there’s a limit to how much paper money the United States can circulate at any one time, and there are rules that limit how many gold, silver and copper coins the Treasury can mint. But the Treasury is explicitly allowed to mint however many platinum coins it wants and can assign them whatever value it pleases.

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Why any debt-ceiling deal will squeeze the states

No matter how the debt-ceiling fight is resolved in Congress, it’s going to end poorly for the states.

If the country defaults, the states will be plunged into an immediate financial crisis: Investor confidence in government assets across the board would plummet — including the municipal bonds that states and local governments have traditionally relied upon to pay for new schools, roads, utilities, sewage systems and other basic infrastructure.

According to Dan White, an economist for Moody’s Analytics, states and local governments would see their credit ratings drop and their borrowing costs rise, and they would be forced to abruptly slash services and employees for the near future.

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Record of family’s global corporation follows Jon Huntsman Jr.

Jon M. Huntsman Jr. has worked for four presidents, served as governor of Utah and most recently was the nation’s ambassador to China. At every other point over the past three decades, he has worked for Huntsman Corp., the multibillion-dollar chemical company his father founded.

Huntsman Corp. provided the Utah Republican with his personal fortune, estimated at $17 million to $84 million, and a jump-start in politics. As Huntsman pursues the presidency, his executive positions are the kind of real-world corporate experience many voters see as necessary to turning around the economy.

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Debt deadline may provide another Mitch McConnell moment

At the end of last week, with the country barreling toward financial default and the governing apparatus at a loss about how to respond, the crisis seemed to demand the involvement of someone with the personal gravitas, political acumen and institutional leverage to move the process toward a final deal. The moment called out for Mitch McConnell.

On Saturday, after all the partisan bills were doomed and dismissed, the Senate minority leader took charge of the process, reaching out to the White House to demand that President Obama get personally involved. Any debt-ceiling deal before the Tuesday default deadline, McConnell said, would require direct engagement with the president — and late Saturday, the approach seemed the last, best hope.

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U.S. default could deliver swift hit to consumers

Life might get more difficult for many Americans if Congress doesn’t reach a deal to raise the government’s borrowing limit.

Without the ability to borrow more, the Treasury has said it would not have enough cash on hand to pay all its bills, which include payments due on the government’s outstanding debt. Experts disagree on when exactly such a default would occur or how long it would last. But the impact could be wide-reaching.

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