Barack Obama on The Huffington Post

TARP Failures Keep Taxpayers On The Hook; 33 Companies Miss Payment

2009-11-15T19:35:03Z

According to The Washington Post, 33 companies that received a portion of TARP's $700 billion have not paid the federal government their most recent dividend payments. Those payments are required by the terms of the bailout and signal that the firms are strained for cash, according to the Post.

If those companies fail, US taxpayers stand to lose billions.

The Post profiles CIT's failure and bankruptcy despite $2.3 billion in investments from the federal government, money that US taxpayers will likely never see (though Goldman Sachs, another CIT investor, stands to make $1 billion from the company's failure). CIT's bankruptcy filings listed $71 billion in assets and $64.6 billion in debt.

The Fed deemed CIT to be a bank holding company in December 2008, allowing CIT to borrow from TARP. The Fed argued that allowing CIT to borrow TARP funds would help the public because the lender would be free to loan more--except that never happened.

In the fiscal year ending on Sept. 30, CIT made just 142 loans backed by the Small Business Administration totaling $105 million. One year before, CIT lent 1,589 SBA loans totaling $873 million.

In July, Reuters reported that CIT's troubles raise questions about the Fed's supervision. Just weeks after the Fed's decision that allowed CIT to borrow TARP funds, the FDIC turned down a request to guarantee CIT debt. The FDIC was worried about "CIT's higher risk lending, escalating bad loans, and limited capacity for new lending."

Alan S. Blinder, the former Fed vice chairman under President Clinton, argues that the decision to bailout CIT was the weakest. Washington Post:

"Of all the financial companies that were rescued or semi-rescued, CIT was always the thinnest case, the toughest to defend," he said. "My attitude was: Hold your nose and go for it. It's something that I would rather not have seen the government do. . . . But the Fed and the Treasury and the others were in the unenviable position of being like the Dutch boy with the finger in the dike. And we definitely didn't want the dike to burst."

On the day that news broke about CIT's bankruptcy filing, The New York Times' Gretchen Morgenson wondered if CitiGroup, another bailed out institution, could "carry its own weight." In just 80 years, the federal government has bailed out CitiGroup four times. Citigroup has ominously been called "the queen of the zombie dance," by Chris Whalen, editor of the Institutional Risk Analyst. There are doubts that CitiGroup can survive, even after its most recent $45 billion federal bailout. Whalen in the Times:

"They are hoping that a combination of bank assistance and maximizing revenue and buying time will let them survive," he said. "When I look at the whole picture, Citigroup is in the process of resolution. I continue to believe the equity is worth zero and that the company will have to go to bondholders for some kind of money to make the bank stable."

Companies that fail even after receiving TARP money

Pat Quinn, Dick Durbin Try To Build Support For Gitmo Inmates' Relocation To Thomson Prison In Illinois

2009-11-15T19:06:56Z

CHICAGO — Gov. Pat Quinn and U.S. Sen. Dick Durbin on Sunday tried to build support and counter criticism of a proposal to sell a prison in rural northwestern Illinois to the federal government to house Guantanamo Bay detainees and other inmates.

Federal officials are expected to visit the maximum security Thomson Correctional Center, about 150 miles west of Chicago, on Monday.

Copenhagen Goals Scaled Back: World Leaders Put Off Climate Change Treaty

2009-11-15T17:18:01Z

Confirming doubts that had been growing for months, the world leaders in attendance at APEC -- along with Danish Prime Minister Lars Lokke Rasmussen -- announced on Sunday morning that a legally binding deal on climate change would be impossible to achieve at the U.N. summit on global warming in Copenhagen next month.

China To Obama: Dalai Lama Was A Slave Master In Tibet

2009-11-15T16:48:17Z

BEIJING — The conviction was clear but the message befuddling: China's Foreign Ministry spokesman was equating serfdom in Tibet to slavery in the U.S. – just ahead of President Barack Obama's first trip to China.

Was it a monumental gaffe, last-minute stab at finding a common frame of reference, or a canny piece of strategy designed to redefine the U.S.-China dispute over Tibet?

Obama In China: 'Walks A Tightrope' In His First Visit

2009-11-15T14:58:36Z

SHANGHAI — President Barack Obama is walking a tightrope on his first trip to China, seeking to enlist help in tackling urgent global problems while weighing when and how – or if – he should raise traditional human rights concerns.

Obama arrived in Shanghai late at night, in a driving rain, hustling through a phalanx of umbrella-holding dignitaries to reach his limousine. On Monday, the president is holding talks with local politicians and, in one of the marquee events of his weeklong Asian trip, conducting an American-style town hall discussion with Chinese university students.

Gretchen Morgenson: Lobbyists Win Again In Securing Tax Break For Home Builders

2009-11-15T13:11:06Z

The New York Times's Gretchen Morgenson points out that lobbyists have won another victory that will lead to billions in taxpayer dollars being handed over to firms that helped spur the economic crisis.

The Worker, Homeownership and Business Assistance Act of 2009, which President Obama just signed into law, contains "a tax break that lets big companies offset losses incurred in 2008 and 2009 against profits booked as far back as 2004," Morgenson reports. (Read the full story here.)

The administration estimates that the tax breaks will be worth some $33 billion, and home builders -- who analysts say were key players in the financial crisis by building and financing too many homes -- stand to benefit enormously.

One of the more shocking elements of Morgenson's piece is just how large a rate of return these home builders got for the money they spent on lobbying for this tax break:

Securing this tax break was a top priority for home builders, lobbying records show. The Center for Responsive Politics reports that through Oct. 26 of this year, home builders paid $6 million to their lobbyists. Last year, the industry spent $8.2 million lobbying...

...Among individual companies, Lennar spent $240,000 lobbying while companies affiliated with Hovnanian Enterprises spent $222,000. Pulte Homes spent $210,000 this year.

That's some return on investment. After spending its $210,000, Pulte will receive $450 million in refunds. And Hovnanian, after spending its $222,000, will get as much as $275 million.

Even as unemployment continues to rise and the Obama administration's foreclosure plan appears to be failing, Congress and the White House are signing off on tax breaks that reward those who are partly responsible for our financial predicament.

To follow more lobbying shenanigans, check out HuffPost's LobbyBlog.

Liz Cheney Suggests Dad Dick As 2012 Presidential Candidate (VIDEO)

2009-11-15T10:58:44Z

In the midst of a discussion of the latest conservative scandal -- an uproar over the fact that President Obama bowed to the emperor of Japan -- Liz Cheney suggested her father take over the office in a few years.

Host Chris Wallace pointed out that former Vice President Dick Cheney did not bow to the emperor when he visited Japan. (He did not elaborate on how this difference in greeting affected American policy or foreign relations.)

"You could ... look at the comparison and think, Cheney 2012," Liz Cheney said.

"Really? How far do you want to go with that?" Wallace responded excitedly. "Let Liz make news ... Cheney/Palin," Bill Kristol cut in. "Or Palin/Cheney -- don't be sexist," Wallace added.

For more on this latest right-wing talking point, go here. And for what it's worth, here are some photos of President Eisenhower bowing to foreign leaders.

Get HuffPost Politics On Facebook and Twitter!

Read more: Obama, Video, President Obama, Politics News

Obama: US, Russia Will Have New Nuclear Pact By Year's End

2009-11-15T10:04:45Z

China Detains Dissidents Ahead Of Obama Visit

2009-11-15T08:30:19Z

Chinese police have detained dozens of dissidents and political reform advocates ahead of US President Barack Obama's first visit to China, according to family members and human rights activists.

Obama Bows In Japan To Emperor Akihito and Empress Michiko (VIDEO, PHOTOS)

2009-11-15T02:36:21Z

In a scene that will likely be replayed on Sunday's political talk shows, President Obama bowed deeply to the Emperor and Empress of Japan on Saturday. The president's kowtow to the royal couple came on the second day of his Asian tour and before a private lunch with the pair in Tokyo.

An unnamed, senior Obama administration official told Politico Saturday that the president was observing protocol, saying, "I think that those who try to politicize those things are just way, way, way off base." During his speech in Tokyo, President Obama reaffirmed the United State's alliance with Japan and called himself America's first Pacific President.

In April, the president was criticized by the National Republican Senatorial Committee for bowing to Saudi King Abdullah at a G-20 meeting. Press Secretary Robert Gibbs declined to call Obama's gesture to Abdullah a bow, instead saying Obama "bent over" to shake hands with the king.

Anticipating drama, the Los Angeles Times wrote a blog entry Saturday about the bow. The LA Times detailed former Vice President Dick Cheney's (non-bow) handshake with the Japanese emperor and pointed to the "comedic" drama surrounding former Presdient Clinton's bow to Akihito.

WATCH:

PHOTOS:

Abortion Rights Groups Scramble In Stupak Amendment's Wake

2009-11-15T02:15:00Z

WASHINGTON — Abortion rights groups, outflanked and outnumbered in the health debate, are scrambling to regain lost ground after the House passed a health bill with strict abortion limits.

They're blanketing Capitol Hill with lobbyists, petitions, letters and phone calls in efforts to defeat the restrictions in the Senate, where debate could begin in a few days. They also have a larger goal: to prove that with their Democratic allies in control of the White House and both congressional chambers – but increasingly appealing to conservative voters who back abortion limits – they still have clout.

Obama tells Myanmar junta to free Suu Kyi

2009-11-15T01:59:27Z

SINGAPORE — President Barack Obama on Sunday told Myanmar's junta to free pro-democracy leader Aung San Suu Kyi during an unusual face-to-face interaction with a top leader of the ruling military.

Obama delivered the strong message during his summit with leaders of 10 Southeast Asian nations, which included Myanmar Prime Minister Gen. Thein Sein.

An Interview With David Bromwich About Obama, Afghanistan

2009-11-15T01:01:50Z

David Bromwich seems to me better yet at Obama-watching than at press criticism. He can write with penetration of Barack Obama as an American almost-literary invention, and he can make you feel you're reading Nabokov on Don Quixote or Harold Bloom on Hamlet.

Obama's Visit Stirs Rethinking On Race, Racism In China

2009-11-15T00:43:13Z

As the country gets ready to welcome the first African American U.S. president, whose first official visit here starts Sunday, the Chinese are confronting their attitudes toward race, including some deeply held prejudices about black people.

Medicare Paid $47 Billion In Suspect Claims, According To HHS

2009-11-15T00:20:56Z

WASHINGTON — The government paid more than $47 billion in questionable Medicare claims including medical treatment showing little relation to a patient's condition, wasting taxpayer dollars at a rate nearly three times the previous year.

Excerpts of a new federal report, obtained by The Associated Press, show a dramatic increase in improper payments in the $440 billion Medicare program that has been cited by government auditors as a high risk for fraud and waste for 20 years.

Frank Rich: The Missing Link Between Fort Hood And The War In Afghanistan

2009-11-14T22:31:01Z

For all the right's jeremiads, its own brand of political correctness kept it from connecting two crucial dots: how our failing war against terrorists in Afghanistan might relate to our failure to stop a supposed terrorist attack at home.

GOP Presidential Candidates Already Jockeying For 2012 Election

2009-11-14T20:17:32Z

WASHINGTON — Sarah Palin is embarking on a book tour. Tim Pawlenty is building a national political operation. Mitt Romney is weighing in on the recession.

They're all jockeying for the 2012 Republican presidential nomination – even if they won't say so.

Thomson Prison In Illinois Is Leading Choice In Obama's Search For Stateside Gitmo

2009-11-14T17:34:58Z

CHICAGO — The Obama administration may buy a near-empty prison in rural northwestern Illinois to house detainees from Guantanamo Bay along with federal inmates, a White House official said Saturday.

The maximum-security Thomson Correctional Facility, about 150 miles west of Chicago, was one of several evaluated by the Federal Bureau of Prisons, and emerged as a leading option to house the detainees, the official told The Associated Press on condition of anonymity because a decision has not been made.

Obama Pushing Arms Control With Russians On Asia Trip

2009-11-14T15:41:01Z

SINGAPORE — President Barack Obama and other world leaders agreed Sunday that next month's much-anticipated climate change summit will be merely a way station, not the once hoped-for end point, in the search for a worldwide global warming treaty.

The 192-nation climate conference beginning in three weeks in Copenhagen had originally been intended to produce a new global climate-change treaty. Hopes for that have dimmed lately. But comments by Obama and fellow leaders at a hastily arranged breakfast meeting here on the sidelines of an Asia-Pacific summit served to put the final nail in any remaining expectations for the December summit.

High Cost Of War Weighs On Obama's Troop Decision For Afghanistan

2009-11-14T15:23:55Z

While President Obama's decision about sending more troops to Afghanistan is primarily a military one, it also has substantial budget implications that are adding pressure to limit the commitment, senior administration officials say.

Obama Urges Congress To Put Off Fort Hood Probe, Warns Against Turning Tragedy Into "Political Theater" (VIDEO)

2009-11-14T08:56:39Z

(AP) WASHINGTON — President Barack Obama on Saturday urged Congress to hold off on any investigation of the Fort Hood rampage until federal law enforcement and military authorities have completed their probes into the shootings at the Texas Army post, which left 13 people dead.

On an eight-day Asia trip, Obama turned his attention home and pleaded for lawmakers to "resist the temptation to turn this tragic event into the political theater." He said those who died on the nation's largest Army post deserve justice, not political stagecraft.

WATCH:

"The stakes are far too high," Obama said in a video and Internet address released by the White House while the president he was flying from Tokyo to Singapore, where Pacific Rim countries were meeting.

Army psychiatrist Maj. Nidal Malik Hasan, 39, was charged on Thursday with the shooting spree at Fort Hood last week. Army investigators have said Hasan is the only suspect and could face additional charges.

Obama already had ordered a review of all intelligence related to Hasan and whether the information was properly shared and acted upon within government agencies. Several members of Congress, particularly Michigan Rep. Peter Hoekstra, the top Republican on the House Intelligence Committee, have also called for a full examination of what agencies knew about Hasan's contacts with a radical Muslim cleric in Yemen and others of concern to the U.S.

Hoekstra confirmed this week that government officials knew of about 10 to 20 e-mails between Hasan and the radical imam, beginning in December 2008.

A joint terrorism task force overseen by the FBI learned late last year of Hasan's repeated contact with the cleric, who encouraged Muslims to kill U.S. troops in Iraq. The FBI said the task force did not refer early information about Hasan to superiors because it concluded he wasn't linked to terrorism.

Lawmakers, however, already have announced they want their own investigations and were frustrated with what they view as a less-than-forthcoming administration.

Rep. Howard McKeon, R-Calif., said he wanted to go ahead with an investigation from the House Armed Services Committee, where he is the top Republican. He said he wanted an investigation that wouldn't compromise law enforcement or military investigations that were continuing on separate tracks.

In the Senate, Sen. Joe Lieberman, a Connecticut independent, said his Homeland Security Committee was opening an investigation.

Obama said he was not opposed to hearings – eventually. But he strongly pressed lawmakers to hold off until the probes now under way are completed.

"There is an ongoing investigation into this terrible tragedy," Obama said. "That investigation will look at the motives of the alleged gunman, including his views and contacts."

"We must compile every piece of information that was known about the gunman, and we must learn what was done with that information. Once we have those facts, we must act upon them."

- PHILIP ELLIOTT