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Obama Tax Cuts Likely Soon

Senior Adviser Says Middle Class Needs 'Some Relief Now'

By Philip Rucker

Washington Post Staff Writer

HONOLULU, Dec. 28 -- President-elect Barack Obama's economic stimulus plan will include an immediate tax cut for middle-class families, and the incoming administration hopes to enact permanent tax cuts soon thereafter, a senior adviser to Obama said Sunday.

David Axelrod said the stimulus package will be implemented soon, given the worsening economy, and could cost $675 billion to $775 billion. The massive recovery plan will seek to create or save 3 million jobs, he said in appearances Sunday on NBC's "Meet the Press" and CBS's "Face the Nation."

"Look, we feel it's important that middle-class people get some relief now," Axelrod said on "Meet the Press." Obama has "promised a middle-class tax cut," he added. "This package will include a portion of that tax cut that will become part of the permanent tax cut he'll have in his upcoming budget."

Giving people more spending money will "help get our economy going again," Axelrod said. He also said he is hopeful that the recovery plan will be ready for Obama to sign soon after his Jan. 20 inauguration.

"Obviously, the sooner the better," Axelrod said on "Face the Nation." "I don't think Americans can wait. People are suffering, our economy is sliding, and we need to act. And so our message to Congress is to work on it with all deliberate speed."

Obama, in the second week of a vacation in Hawaii, continues to work on his economic plan, aides said. He is considering immediate tax cuts of $1,000 for couples and $500 for individuals, which would be delivered through reduced tax withholding from paychecks, a transition aide said. That plan could cost about $140 billion over the next two years, the aide said.

Axelrod said that the incoming administration plans to propose permanent tax cuts in its next budget but that officials have not determined the form of those cuts. They are likely to be based on Obama's campaign proposal, which said that families earning less than $250,000 would see their taxes remain the same or decrease.

Asked by NBC's David Gregory whether Obama will raise taxes on the wealthiest Americans by reversing President Bush's tax cuts, Axelrod said Bush's plan is "something that we plainly can't afford moving forward."

"Whether it expires or whether we repeal it a little bit early, we'll determine later, but it's going to go," Axelrod said. "It has to go."

Obama's economic stimulus plan is expected to include billions in new spending on infrastructure projects, aid to beleaguered state governments and programs to create jobs. Axelrod said creating jobs is an essential part of the plan.

"We want to do it in a way that leaves a lasting footprint, by investing in energy and health-care projects, and refurbishing the nation's classrooms and labs and libraries so our kids can compete, and rebuilding our crumbling roads and bridges and waterways," he said on "Face the Nation." "And, in this way, we're not only just -- we're not only creating work, but we're laying the foundation for the future of our economy."

The GOP Goes South

By David S. Broder

Sunday, December 28, 2008; Page B07

As a rule, a new president's choice of a secretary of transportation makes few headlines, even when the appointee is a member of the opposition. In 2001, George W. Bush decided to name as transportation secretary Norman Mineta, a former representative from California, to be the token Democrat in his Cabinet, and no one noticed. And no one except for Mark Shields, who lavishly praised the appointment, paid much attention last week when Barack Obama made Ray LaHood, the retiring representative from Peoria, Ill., the second Republican in his Cabinet.

This one, however, is loaded with meaning because LaHood is no ordinary member of Congress. He has been, as Shields pointed out, one of the most widely respected members of the House; a leader in the uphill struggle for comity between the parties; and a throwback to the days of his old boss Bob Michel, the minority leader who resisted the scorched-earth tactics of Newt Gingrich. Such was LaHood's reputation for fairness that he was the natural choice to preside over the House during the explosive impeachment proceedings against Bill Clinton.

The significance of his accepting Obama's offer goes beyond the signal it sends of the new president's seriousness about outreach to moderate Republicans. As transportation secretary, LaHood will be at the center of the road and bridge construction projects Obama plans to make the highlight of his almost trillion-dollar stimulus program.

All the signs are that the stimulus spending will be opposed by congressional Republicans, whose shrunken ranks are increasingly dominated by right-wing Southerners who care not what their stance does to harm the party's national image.

The spectacle of LaHood facing off in congressional testimony against those naysayers will dramatize a split that is crippling the GOP.

The danger became apparent as far back as 2007. With Bush weakened by the Iraq war, Hurricane Katrina and the midterm election losses of 2006, a Southern-led revolt killed his immigration reform bill. Junior senators such as Jim DeMint of South Carolina directed the rebellion, and Minority Leader Mitch McConnell, unable to stem the insurgency, joined it.

The price was paid in the 2008 presidential campaign. Despite his personal credentials as a sponsor of comprehensive immigration reform, John McCain was caught in the backlash of anti-GOP voting by Hispanics. It contributed to his loss of Colorado, New Mexico, Nevada, Florida and other states.

The same thing happened this year when Bush supported a bailout for the Big Three auto companies. Led by Republican senators from Southern states where there are many foreign-owned auto plants, the Senate refused to cut off a filibuster against the bill to provide bridge loans to General Motors and Chrysler. This time, the opposition was led by Bob Corker of Tennessee and Richard Shelby of Alabama. When the Senate failed by eight votes to cut off debate, Southern and border-state Republicans voted 16 to 2 against the measure. On a similar vote on the 2007 immigration bill, the Southerners split 17 to 3 against.

Even though Bush later used his authority to provide the loan, the defeat of this legislation at Republican hands will not be forgotten when GOP senators run for reelection in 2010 in states such as Ohio and Pennsylvania. It will also echo in industrial states such as Michigan, Indiana, Wisconsin, Illinois, California, New York and New Jersey, when Republicans try to challenge for Senate and House seats.

The Southern domination of the congressional Republican Party has become more complete with each and every election. This year, Republicans suffered a net loss of two Senate and three House seats in the South, but they lost five Senate seats and 18 House seats in other sections. No Republican House members are left in New England, and they have become ever scarcer in New York and Pennsylvania and across the Midwest.

LaHood, who witnessed but did not welcome the Gingrich "revolution" in the House, has watched with growing alarm the decimation of the GOP in Illinois and surrounding states. As point man for Obama's stimulus spending, he now poses the dilemma for his own party in the sharpest possible terms: Will congressional Republicans again sacrifice their political interest to satisfy their Southern-baked ideological imperatives?

davidbroder@washpost.com

Planning for Obama's inaugural bash is no party

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Lauren Victoria Burke / Associated Press

Lincoln’s gilt-edged inaugural Bible at the Library of Congress. Obama will be the first president to use this Bible at a swearing-in since Lincoln did it in 1861.

Donor fatigue and contribution limits mean more givers are needed. That has made preparations more difficult.

By Peter Wallsten and Tom Hamburger
December 25, 2008

Reporting from Washington -- From the announcement of Barack Obama's longshot candidacy to the management of his presidential transition, his organization -- including the biggest fundraising operation in U.S. political history -- has rolled forward with seemingly flawless precision.

But for the team trying to pull in more than $40 million to pay for the festivities at next month's historic inauguration, the process has had some uncharacteristically bumpy moments. Officials expect to meet their budget and underwrite a colossal celebration that they say will be open to more people than ever.

Still, with less than a month to go, organizers are adding elements to the master calendar. They've told some supporters that they might not get all the goodies they'd expected in exchange for big donations. And they've scrambled to think up new ways to deal with unforeseen "market frenzy": the insatiable appetite of wealthy supporters not just to attend, but also to buy themselves VIP status.

An estimated 3 million to 5 million people are expected to squeeze in around the Capitol and onto the National Mall for the Jan. 20 swearing-in. Most will contend with frigid weather, traffic jams, packed subway cars and walks from distant staging areas -- all for a fleeting glimpse of the new president.

But those making big donations will be rewarded with exclusive tickets, upfront seating and invitations to fancy events, including a black-tie dinner with Obama and Vice President-elect Joe Biden for hundreds of the most generous supporters.

Anyone raising $300,000 or more will earn the title "trustee" and get four tickets to every special inaugural event on the schedule, along with seats to the swearing-in and parade.

Rewarding big donors with inauguration day favors is nothing new. But the challenge is especially difficult this time.

Many potential givers are experiencing donor fatigue after the long campaign, especially with the economy in a tailspin. And in keeping with Obama's promise of high ethical standards, his canvassers have operated under a limit of $50,000 per contribution from individuals. Obama's camp also banned any donations from corporations, unions and political action committees.

That means more donors were needed -- as were more enticements.

The result has been some unusual headaches for a team whose fundraising operations have been run with widely envied precision.

To begin with, planners may have thought too small when putting together events such as candlelight dinners. They had no trouble finding buyers for the high-priced tickets, and some fundraisers have been told that there might not be room for everyone who expected special treatment -- not just inaugural donors but major campaign fundraisers and political allies.

The demand for special treatment has been so great that the inauguration committee faced the possibility of well-heeled supporters being turned away from some of the most sought-after events -- a fundraiser's nightmare. Many donors still don't know whether they will get tickets to coveted inaugural balls such as the one hosted by Obama's home state of Illinois.

Where'd the Bailout Money Go? Shhhh, It's a Secret

Where'd the bailout money go? $350 billion later, banks won't say how they're spending it

By MATT APUZZO Associated Press Writer
WASHINGTON December 22, 2008 (AP)

It's something any bank would demand to know before handing out a loan: Where's the money going?

But after receiving billions in aid from U.S. taxpayers, the nation's largest banks say they can't track exactly how they're spending the money or they simply refuse to discuss it.

"We've lent some of it. We've not lent some of it. We've not given any accounting of, 'Here's how we're doing it,'" said Thomas Kelly, a spokesman for JPMorgan Chase, which received $25 billion in emergency bailout money. "We have not disclosed that to the public. We're declining to."

The Associated Press contacted 21 banks that received at least $1 billion in government money and asked four questions: How much has been spent? What was it spent on? How much is being held in savings, and what's the plan for the rest?

None of the banks provided specific answers.

"We're not providing dollar-in, dollar-out tracking," said Barry Koling, a spokesman for Atlanta, Ga.-based SunTrust Banks Inc., which got $3.5 billion in taxpayer dollars.

Some banks said they simply didn't know where the money was going.

"We manage our capital in its aggregate," said Regions Financial Corp. spokesman Tim Deighton, who said the Birmingham, Ala.-based company is not tracking how it is spending the $3.5 billion it received as part of the financial bailout.

The answers highlight the secrecy surrounding the Troubled Assets Relief Program, which earmarked $700 billion — about the size of the Netherlands' economy — to help rescue the financial industry. The Treasury Department has been using the money to buy stock in U.S. banks, hoping that the sudden inflow of cash will get banks to start lending money.

There has been no accounting of how banks spend that money. Lawmakers summoned bank executives to Capitol Hill last month and implored them to lend the money — not to hoard it or spend it on corporate bonuses, junkets or to buy other banks. But there is no process in place to make sure that's happening and there are no consequences for banks who don't comply.

When White Vigilantes Reign

By A. C. Thompson | TheRoot.com

Why are New Orleans militiamen still bragging about shooting black men after Katrina?

Dec. 19, 2008-- America has never had a terribly forthright relationship with its history. No surprise, then, that three years after Katrina laid bare the deep, deadly inequality festering in our nation's cities, we've already blotted the memory. In a breathtaking article in this week's edition of The Nation magazine, investigative reporter A.C. Thompson (you can read my Q&A with him here ) does his best to remind us all just how lasting the disaster was for black folks—and how many urgent issues remain unaddressed. Not least of them is a string of vigilante executions that New Orleans law enforcement has, at best, ignored and possibly encouraged.

Thompson brings readers up close with the white vigilantes themselves, who brag about their murderous reign over the Algiers Point neighborhood that the National Guard designated as an evacuation site. Thompson's reporting reverses the once-popular narrative of black lawlessness in the days after the storm: As order broke down, white residents' fears and fantasies about black people justified an orchestrated campaign of anti-black terrorism.

                                                          - Kai Wright

Reprinted courtesy of The Nation.  A.C. Thompson's reporting on New Orleans was directed and underwritten by the Investigative Fund at  The Nation Institute .  ProPublica  provided additional support, as did the  Center for Investigative Reporting  and  New America Media .

I.

The way Donnell Herrington tells it, there was no warning. One second he was trudging through the heat. The next he was lying prostrate on the pavement, his life spilling out of a hole in his throat, his body racked with pain, his vision blurred and distorted.

It was September 1, 2005, some three days after Hurricane Katrina crashed into New Orleans, and somebody had just blasted Herrington, who is African-American, with a shotgun. "I just hit the ground. I didn't even know what happened," recalls Herrington, a burly 32-year-old with a soft drawl.

The sudden eruption of gunfire horrified Herrington's companions--his cousin Marcel Alexander, then 17, and friend Chris Collins, then 18, who are also black. "I looked at Donnell and he had this big old hole in his neck," Alexander recalls. "I tried to help him up, and they started shooting again." Herrington says he was staggering to his feet when a second shotgun blast struck him from behind; the spray of lead pellets also caught Collins and Alexander. The buckshot peppered Alexander's back, arm and buttocks.

Herrington shouted at the other men to run and turned to face his attackers: three armed white males. Herrington says he hadn't even seen the men or their weapons before the shooting began. As Alexander and Collins fled, Herrington ran in the opposite direction, his hand pressed to the bleeding wound on his throat. Behind him, he says, the gunmen yelled, "Get him! Get that nigger!"

The attack occurred in Algiers Point. The Point, as locals call it, is a neighborhood within a neighborhood, a small cluster of ornate, immaculately maintained 150-year-old houses within the larger Algiers district. A nationally recognized historic area, Algiers Point is largely white, while the rest of Algiers is predominantly black. It's a "white enclave" whose residents have "a kind of siege mentality," says Tulane University historian Lance Hill, noting that some white New Orleanians "think of themselves as an oppressed minority."

Why History Can't Wait

Person of the Year 2008

You probably sat in a fancier conference room the last time you refinanced or heard a pitch about life insurance. There's a table, some off-brand mesh office chairs, a bookcase that looks as if it had been put together with an Allen wrench and instructions in Swedish.

To reach this room, you pass through a cubicle farm lightly populated by quiet young people. Either they have just arrived or they are just leaving, because their desks are almost bare. The place has a vaguely familiar feel to it, this air of transient shabbiness and nondescriptitude. You can't quite put your finger on it ...

"It's like the set of The Office," someone offers.

Bingo.

It is here that we find Barack Obama one soul-freezingly cold December day, mentally unpacking the crate of crushing problems — some old, some new, all ugly — that he is about to inherit as the 44th President of the United States. Most of his hours inside the presidential-transition office are spent in this bland and bare-bones room. You would think the President-elect — a guy who draws 100,000 people to a speech in St. Louis, Mo., who raises three-quarters of a billion dollars, who is facing the toughest first year since Franklin Roosevelt's — might merit a leather chair. Maybe a credenza? A hutch?

But he doesn't seem to notice. Obama is cheerfully showing his visitors around, gripping the souvenir basketball he received from Hall of Famer Lenny Wilkens, explaining a snapshot taken the day he played pickup with the University of North Carolina hoops team. ("They are so big and so fast and so strong, you know.") Then, since those two items basically exhaust the room's décor, Obama sits down on one of the mesh chairs and launches into a spoken tour of his world of woes. It's a mind-boggling journey, although he shows no signs of being boggled — unless you count the increasingly prevalent salt in his salt-and-pepper hair. By now we are all accustomed to that Obi-Wan Kenobi calm, though we may never entirely understand it. In a soothing monotone, he highlights the scariest hairpin turns on his itinerary, the ones that combine difficulty with danger plus a jolt of existential risk. (See pictures of the Civil Rights movement from Emmett Till to Barack Obama.)

"It is not clear that the economy's bottomed out," he begins, understatedly. (The morning newspaper trumpets the worst unemployment spike in more than 30 years.) "And so even if we take a whole host of the right steps in terms of the economy, two years from now it may not have fully recovered." That worries him. Also Afghanistan: "We're going to have to make a series of not just military but also diplomatic moves that fully enlist Pakistan as an ally in that region, that lessen tensions between India and Pakistan, and then get everybody focused on rooting out militancy in a terrain, a territory, that is very tough — and in an enormous country that is one of the poorest and least developed in the world. So that, I think, is going to be a very tough situation.

"And then the third thing that keeps me up at night is the issue of nuclear proliferation," Obama continues, sailing on through the horribles. "And then the final thing, just to round out my Happy List, is climate change. All the indicators are that this is happening faster than even the most pessimistic scientists were anticipating a couple of years ago."

Score that as follows: one imploding economy, one deteriorating war in an impossible region and two versions of Armageddon — the bang of loose nukes and the whimper of environmental collapse. That's just for starters; we'll hear the unabridged version shortly.

But first, there is a bit of business to be dealt with, having to do with why you are reading this story in this magazine at this time of the year. It's unlikely that you were surprised to see Obama's face on the cover. He has come to dominate the public sphere so completely that it beggars belief to recall that half the people in America had never heard of him two years ago — that even his campaign manager, at the outset, wasn't sure Obama had what it would take to win the election. He hit the American scene like a thunderclap, upended our politics, shattered decades of conventional wisdom and overcame centuries of the social pecking order. Understandably, you may be thinking Obama is on the cover for these big and flashy reasons: for ushering the country across a momentous symbolic line, for infusing our democracy with a new intensity of participation, for showing the world and ourselves that our most cherished myth — the one about boundless opportunity — has plenty of juice left in it. 

Mr. Obama’s Internet Agenda

President-elect Barack Obama recently announced an ambitious plan to build up the nation’s Internet infrastructure as part of his proposed economic stimulus package. Upgrading the Internet is a particularly smart kind of stimulus, one that would spread knowledge, promote entrepreneurship and make this country more competitive globally.

The United States has long been the world leader in technology, but when it comes to the Internet, it is fast falling behind. America now ranks 15th in the world in access to high-speed Internet connections. A cornerstone of Mr. Obama’s agenda is promoting universal, affordable high-speed Internet.

Mr. Obama, who had notable success with online fund-raising and voter turnout, spoke during the presidential campaign about the transformative power of the Internet to improve Americans’ quality of life. He argued that it could, among other things, reduce health care costs, create jobs and make it easier for citizens to participate in government decision-making.

In a speech this month about his economic stimulus plan, he said that he intends to ensure that every child has a chance to get online and that he would use some of the stimulus money to connect libraries and schools. It is a critical goal. Children trapped on the wrong side of the digital divide are deprived of a fair chance to educate themselves and to compete for high-skill, high-paying jobs.

Mr. Obama has also been a strong supporter of “network neutrality,” the principle that Internet service providers should not be able to discriminate against any of the information that they carry. Net neutrality laws are necessary to ensure that Internet service providers do not block content they disagree with or give financial breaks to big tech companies, squeezing out smaller competitors and stifling innovation.

Mr. Obama will need to work with Congress — and fight against corporate lobbyists — to accomplish some of his goals. Some he can achieve on his own. With the right appointments to the Federal Communications Commission, he should be able to get good net neutrality regulations.

“This is the Eisenhower Interstate highway moment for the Internet,” argues Ben Scott, policy director of the media reform group Free Press. Restoring America to its role as the world’s Internet leader could be an important part of Mr. Obama’s presidential legacy.

The Obama list in action

The Obama campaign assembled a massive email and cell phone database during the campaign. So what happens now, with the campaign over, with all those names? Can supporters be motivated to contribute to and participate in non-campaign activities?

According to ABC News, well, yes they can.

 This weekend, the results of the activation of the email list -– which an Obama aide estimates is upwards of 13 million people -- was [sic] put on display.

The Obama team reports that 4,252 "Change is Coming" house parties were held in all 50 states -- plus Guam and Puerto Rico. At least 1,950 cities had house parties, and Los Angeles had the largest single party, with 400 people in attendance.

The goal suggested for the meetings was for supporters to "reflect on this monumental journey and plan on how they can bring change to both Washington and their own communities."

The dialogue during the house parties was completely open.

Obama campaign spokesman Ben LaBolt says the parties are the "next step in determining our supporters' vision for how the organization develops."

This weekend's turnout is one sign of how beneficial the extensive email network the Obama campaign acquired during the campaign could be -– leaving the Obama transition team with a potentially powerful grassroots tool at its fingertips. There is much debate -– and more than healthy dose of secrecy -– from the Obama Transition Team as what exactly to do with this consortium.

The house parties this weekend are just one of the first steps demonstrating how the list could potentially be useful at the grassroots level.

Holy moly. If I were working at the Republican National Committee right now, I would be stocking up on booze because it's going to be a long, wintry holiday season that may not end with the breaking of spring in 2009.

― Thomas Schaller

Obama to pick Duncan, Salazar

By CAROL E. LEE & ERIKA LOVLEY |

One is a genuine FOB – Friend of Barack – who shared basketball and bull sessions with the president-elect on reforming schools. The other is one of the Democratic party’s rising Hispanic stars from a key Western state.

Both are set to join Barack Obama’s Cabinet-in-waiting in coming days – Arne Duncan on Tuesday as education secretary, and Colorado Sen. Ken Salazar as interior secretary later this week, sources tell Politico.

Duncan has been the head of the Chicago schools since 2001. He gained a reputation for confronting the problems of inner-city schools when he took over the Ariel Education Initiative in 1992, before joining the Chicago system in 1998.

A Harvard graduate like Obama, Duncan was co-captain of the Crimson basketball team and even played professionally in Australia. He and Obama met about 15 years ago through Michelle Obama’s brother, Craig, and Duncan was among those who played basketball with Obama on Election Day.

In Salazar, Obama sticks with the tradition of filling the interior post with a Westerner while adding a member of his team from a key electoral battleground, one that figured prominently in Obama’s victory strategy.

Salazar, who serves on the Senate Energy and Natural Resources Committee, is known for his past work as director of the Colorado Department of Natural Resources, where he devised a way to conserve land by using state lottery earnings.

A former environmental lawyer, the first-term senator has backed numerous environmentally friendly policies. Just last week, for instance, he urged lawmakers to base the nation’s economic recovery package around clean energy infrastructure – a goal Obama laid out in announcing his energy and environment team Monday.

Salazar also recently called Interior’s decision to move forward on commercial oil shale development in Colorado, Wyoming and Utah “premature and flawed.”

The environmental community is looking to the new interior secretary as a leader in the fight against global warming, should Obama move to regulate greenhouse gas emissions through the Endangered Species Act, which is overseen by the department.

If Salazar gets the Cabinet post, his Senate seat would be filled by Gov. Bill Ritter, a fellow Democrat. And one name at the top of the successor list is Salazar’s brother, Rep. John T. Salazar (D-Colo.).

Obama Makes a Point of Speaking of the People, to the People

By Chris Cillizza

Washington Post Staff Writer
Sunday, December 14, 2008; Page A05

In the 26 years since the weekly radio address became a modern White House staple, presidents have often treated the speech to the nation as a task to be endured rather than an opportunity.

Not so with President-elect  Barack Obama, who has been using his four minutes of weekend airtime not only to speak directly to the American people, but also to create news.

Yesterday, Obama used the address to announce Shaun Donovan, New York City's housing commissioner, as his nominee to head the Department of Housing and Urban Development. Obama has previously outlined a series of specific proposals aimed at reversing the nation's economic torpor, and he sketched out a plan to save or create 2.5 million jobs over the next two years.

Dan Pfeiffer, the incoming White House deputy communications director, said Obama will continue to use the addresses "to make significant news."

That contrasts sharply with President Bush, who presented little policy or political perspective in his radio addresses.

Bush's topic yesterday was the fight against illegal drugs; other recent subjects have included Thanksgiving and the transition process. Even when Bush dedicated six straight radio addresses to the economy -- from mid-September to late October -- the tone was more review than preview.

The incoming president's approach to the address also differs in how content is presented, by marrying the 100-year-old technology of radio to 21st-century tools: The speech is still beamed out to radio stations nationwide on Saturday mornings, but now it is also recorded for digital video and audio downloads from YouTube, iTunes and the like, so people can access it whenever and wherever they want.

"One of the fundamental precepts of our campaign was to use the new technology to reinvigorate our democracy. That's a commitment we will bring to this administration," senior Obama adviser David Axelrod said.