Washington Report

Obama Planning Jobs Summit

As unemployment figures continue to rise, the American public is losing hope about job prospects. In fact, a recent Gallup poll found that their optimism has reached a new low, and only 8% of Americans believe that now is a good time to find a job. For months, Republicans have criticized their Democratic colleagues for not placing enough emphasis on job creation and voters in New Jersey and Virginia recently seconded the emotion by choosing the Republican candidate in their gubernatorial races earlier this month.

President Barack Obama, who also has been criticized for not focusing more on the economy, may finally be getting the message. Before leaving on a nine-day trip to Asia, he announced Thursday that the White House will host a forum on job creation in December. It will bring together small business owners, corporate CEOs, economists, and representatives from labor unions and nonprofit groups to discuss strategies to accelerate job creation–a challenge Obama said his administration is determined to meet.

“We all know that there are limits to what government can and should do, even during such difficult times,” he said Thursday. “But we have an obligation to consider every additional, responsible step that we can [take] to encourage and accelerate job creation in this country.”

Cato Institute fellow Michael Tanner says job creation cannot be built in a day and the summit is more public relations strategy than policy prescription.

“To some degree, the president’s a prisoner of the business cycle. Jobs are a lagging indicator and we won’t see a drop in unemployment until mid or late next year, which is unfortunate in terms of politics,” Tanner said. “Voters tend to punish presidents for bad economic conditions. That means in 2010 they’ll be taking it out on Democrats.”

Dodd Unveils Financial Fix

Sen. Christopher Dodd (D-Connecticut), chairman of the Senate Banking Committee, announced a sweeping proposal on Tuesday that would overhaul financial regulations that would create a single banking regulator.
“The financial crisis exposed a

financial regulatory structure that was the product of historic accident, created piece by piece over decades with little thought given to how it would function as a whole, and unable to prevent threats to our economic security,” Dodd told reporters.

According to a discussion draft summary of the Restoring American Financial Security Act, Dodd’s plan would create a Consumer Financial Protection Agency; create an independent agency to identify and address systemic risks; give shareholders decision making powers on executive compensation and corporate governance; and close regulatory loopholes that allow risky and abusive practices to go unnoticed in such areas as over-the-counter derivatives, mortgage brokers, and payday lenders.

The plan proposes a single federal bank regulator that would be headed by a presidential appointee to be confirmed by the Senate and that would combine the functions of the Office of the Comptroller of the Currency and the Office of Thrift Savings, the FDIC‘s state bank supervisory functions, and the Federal Reserve, which would do little more than set monetary policy. Dodd’s plan also would establish an Office of Credit Rating Agencies at the Securities and Exchange Commission.

Although the bill is more radical than the one being proposed by the House Financial Services Committee, “it confirms that we are moving in the same direction and reaffirms my confidence that we are going to be able to get an appropriate, effective reform package passed very soon,” said Rep. Barney Frank, who chairs the House panel.

Moderate Republican Finds Flaws in Democratic Healthcare Bills

In an off-camera briefing with reporters on Monday, just two days after the House passed its historic healthcare reform bill, moderate Sen. Susan Collins (R-Maine) had harsh words to say about all of the Democratic bills making their way through Congress. In fact, Collins said, “I think there is considerable unease on both sides of the aisle about the impact of these bills, and as more analysis is done, I believe the concerns will only grow.”

Based on her own analyses, Collins says that the bills

would add billions in fees and taxes which insurance providers would pass on to consumers in the form higher premiums and that that they lack healthcare delivery and medical liability reforms. In addition, she said, the bills actually offer disincentives for small businesses to hire more workers or to offer more competitive salaries to employees for fear of losing tax credits.

Democrats have been hopeful that Collins and fellow Republican Maine Sen. Olympia Snowe could be counted on to vote in favor of the Senate bill, but it appears Collins can more likely be counted out–at least for now.

“I still believe we can put together a bipartisan bill that would reduce the number of uninsured, not penalize small business, not drive up the cost of healthcare and would make a real difference,” said Collins.

She’d like to see the entire bill rewritten and plans to offer an amendment that may come in the form of substitute legislation or fixes for various parts of the existing bill.