1.) Obama’s jobs team gets green-washed — “President Barack Obama will name Jeffrey Immelt, General Electric Co.’s chief executive officer, to head his outside panel of economic advisers, replacing former Federal Reserve Chairman Paul Volcker,” reports Bloomberg News. “Immelt has sounded many of the administration’s themes: boosting jobs through U.S. exports, ensuring companies can compete with powers like China and India, and jumpstarting a clean-energy economy. Immelt wrote today that he and Obama ‘are committed’ to making the U.S. ‘the most competitive and innovating economy in the world.’” According to Bloomberg, “Immelt is among a group of executives — Boeing Co. CEO Jim McNerney; Motorola Solutions Inc. CEO Greg Brown, and Honeywell International Inc. Chairman David Cote — who have voiced support for Obama policies. The four serve on several of the president’s outside advisory boards”–and all four have made a killing on green jobs subsidies
2.) Will O’s address earn a standing O from conservatives? — During his State of the Union Address, there is one thing Pres. Obama “must do above all,” writes The Daily Caller’s Jon Ward. He must “make a compelling case to the American people that painful and unpalatable measures to put the nation’s books in order are necessary, and that all Americans will be negatively affected by such actions in the years ahead.” Admitting that it’s going to hurt–and more than just a little–would be going with the flow at this point. Obama should just crib from former OMB Director Peter Orszag, who wrote in a Friday editorial for the Financial Times, “I hope it does not ultimately require a crisis to restore fiscal sustainability at the federal level, but I fear it will.” Who doesn’t love a good crisis?
3.) Are Republicans gleefully anticipating state budgetocalypse? — James Pethokoukis of Reuters reported back in December that the GOP’s mouth was watering over the idea of states needing a bailout. Now he’s back with more on how and why: ” Republicans have seen the debt problems in places such as Greece and New Jersey and believe government unions undermine long-term fiscal soundness. They want to spread the Chris Christie’s battle against them nationwide. And of course it also doesn’t hurt that unions are a key Democrat constituency. But Rs think it is possible to pit public and private unions against each other by making the case that plumbers and construction workers are paying higher taxes to support cushy benefits and jobs security for teachers and bureaucrats.”
4.) Mulvaney to Treasury: Chill, bros — Austan Goolsbee and Tim Geithner can stop stoking fears of China repossessing America: South Carolina Rep. Mick Mulvaney is here to help. ‘“The reason you are hearing there will be an automatic default is that Treasury does not as a checkbook function have the ability to prioritize,” Mulvaney told The Daily Caller’s John Rossomando. “What they are saying is, ‘Whenever a check comes in we’ll pay it until we don’t have any money left.’” This sort of thinking is how over-spenders end up on the streets. Geithner et al. need is the ability to say, $500 million for a space program that is never going to leave a lab in Cape Canaveral can wait. Mulvaney wants to give them that ability. “Let’s give them the ability to prioritize and prioritize for them and say, ‘Let’s pay the debt first.’ And if you do that, you can put off this default for many, many months, and this spectre of an immediately impending default goes away.”
5.) Obamacare: Spending money to save money — Using a simple illustration, Harvard’s Greg Mankiw lays out why Obamacare savings are actually reduced Obamacare spendings: “The healthcare reform bill passed last year increased government spending to cover the uninsured, but it also reduced the budget deficit by increasing various taxes as well. Because of this bill, advocates say, the federal government is on a sounder fiscal footing. Repealing it, they say, would make the budget deficit worse.” If that doesn’t make sense, here’s why: “I have a plan to reduce the budget deficit,” Mankiw writes. “The essence of the plan is the federal government writing me a check for $1 billion. The plan will be financed by $3 billion of tax increases. According to my back-of-the envelope calculations, giving me that $1 billion will reduce the budget deficit by $2 billion.”
6.) Wall Streeters want what Fannie’s having — “Wells Fargo and some other large banks would like private companies, perhaps even themselves, to become the new housing finance giants helping to bundle individual mortgages into securities — that would be stamped with a government guarantee,” reports the New York Times. Some big pigs have lined up at the federal trough: Wells Fargo, Morgan Stanley, Goldman Sachs and Credit Suisse have all publicly met with Treasury officials in hopes of being able to do what private student loan companies no longer can. While the Treasury has remained quiet about its plans, former Treasury undersecretary and Rubin protege Michael S. Barr has called it a bad move. “I don’t think that private shareholder-owned entities should issue federal government guarantees,” Barr said. “I think that creates the same conflict we had in the past.” You know something’s up when a Rubinite speaks out against giving special treatment to Wall Street.