Lincoln Amendment or Bust

It looks like the fate of financial reform will get decided on Friday. There have been so many ups and downs in this effort. We've lost so many battles over crucial parts of the bill. It was never that tough to begin with; there are issues with capitalization requirements; there isn't enough control of leverage; the Franken amendment reforming rating agencies should have never been removed. And the list goes on and on (though apparently we have had some recent victories as well).

Despite all of these losses, I'm ready to take half a loaf ... if - and this is a big if - we get to keep the Lincoln amendment on derivatives. It can't be watered down at all. It has to be the real deal. But if that is still in the bill then I think it would be worth voting for - and a real accomplishment for the Democrats.

I have always maintained that complex derivatives were the primary cause of the financial collapse. It's one thing for one bet to go wrong (the subprime market), it's another to have a hundred bets on top of that original bet all go wrong at the same time.

If the banks can't use depositor money as collateral for their betting and they don't get backed up by taxpayers on those bets, then they are free to win or lose them all they like. I have never cared how much profits or losses the banks had, as long as they didn't get the money from us.

I know the Lincoln amendment isn't perfect either and the rest of the bill doesn't have enough restrictions on derivatives (I would ban naked CDS's all together, like Europe is considering). But I'll take this as good starting point. At least the derivatives trading would be split off from taxpayer backed funds and deposits.

I'm afraid if we don't do real financial reform and in a hurry, we are almost certainly headed toward another economic catastrophe. And I'm not sure this bill alone would help us steer away from it. But if the Lincoln amendment passes at least we have fighting chance. Without it, the bill is a joke meant to placate you until the next collapse.

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Labor's Victory in Arkansas

Last night was a pretty good night for organized labor. Their candidate (in the AR-SEN primary) didn’t win, but they turned a blowout into a toss-up and pushed a moderate Senator to the left on at least one major issue. Taking on Democratic incumbents like this is largely unchartered territory for labor, and I’m not naive enough to believe that if you only almost win on a first run, then you’re finished with a stake through your heart. Unfortunately, much of the media is that naïve.

Politico’s Martin Kady says that Senator Lincoln “drove a stake through organized labor last night with her surprise victory over surging Lt. Gov. Bill Halter… Lincoln's victory means that at least for the time being, other moderates in the Senate can breathe easy and keep playing the middle on big ticket legislative items.” A CBS headline asks, "Did labor waste $10 million in Arkansas?" Even First Read says, “Simply put, Lincoln's narrow victory was a crushing blow to organized labor and the internet left, which had rallied around Halter.”

Excuse me, but Lincoln went from 18 points up to 4 points up, from a lock to a dead heat. What if she had started 14 points up? What if the next moderate starts just 10 points up? Organized labor showed they can make up those differences. Since when does that count as “breathing easy?” I’d call that a new and huge headache for Blue Dogs.  

Furthermore, labor started at a severe disadvantage – at just 4.2%, Arkansas has the second-lowest union membership in the country. All of the moderates Politico says can breathe easy are in states with higher union membership than that. Ben Nelson’s Nebraska – 9.2%. Bill Nelson’s Florida – 5.8%. What if labor chose to get involved in primaries in states like Alaska, with 22.3% membership, or Washington, at 20.2%?

A blow-out race in a state unfriendly to unions, and yet labor’s money came very, very close to toppling Lincoln. She was running scared, so stepped it up on derivatives and Wall Street reform – a pretty sweet worst-case scenario for progressives.

There's more...

AR-Sen: Not enough polling places in Halter stronghold

Arkansas Lieutenant Governor Bill Halter has momentum going into tomorrow's runoff election against U.S. Senator Blanche Lincoln, but only two polling places will be open in the most populous county Halter carried in the Democratic primary election. The Blue Arkansas blog has been all over this disturbing story. Garland County has about 80,000 residents, of whom about 12,000 voted at 42 polling places in the Democratic primary on May 18. The Chairman of the Garland County Election Commission, Charles Tapp, is not budging from the decision to open only two polling places in the county for the runoff. That will create obstacles for many voters, especially minorities and people in rural areas. On June 4 Tapp promised to open polling stations on the weekend to make it easier for people to vote, but the stations were closed on Saturday. ARDem explains why you should care:

Remember how rural voters broke so heavily for Halter in the primary? Well now those same rural voters have to travel miles across a mountain range to get to town on a weekday to cast their vote [....] While Halter was going down to Hot Springs to stand up for the right to vote and stuck up for the people trying to do their sacred civic duty, Lincoln couldn’t even bother to talk to us with that condescending double speak of hers:

A spokesperson with Senator Blanche Lincoln’s campaign said they do not have any comment at this time.

Couldn’t even say they were troubled by it.

Pulaski County, which Lincoln carried easily on May 18, has about six times the population of Garland but will have about 50 times as many voting locations open on June 8. Blue Arkansas is urging disenfranchised voters to call Lincoln's campaign, the Garland County Elections Commission, the Arkansas Elections Commission and the U.S. Department of Justice. The White House and Democratic Senatorial Campaign Committee, which are backing Lincoln, should also denounce any attempt to suppress the vote in Arkansas and should demand that a sufficient number of polling stations be open statewide tomorrow.

Meanwhile, Lincoln is trying to portray herself as one of the people while Halter (backed by several labor unions and progressive organizations) is supposedly "letting other people fund his campaign and do his dirty work." Think Progress posted a partial list of the corporate PAC money flowing to Lincoln's campaign. It's not the first time we've seen signs of Lincoln's dishonesty, and it won't be the last if she manages to defeat Halter.

AR-Sen: The state of play

The American Federation of State, County and Municipal Employees will spend $1.4 million in Arkansas before the June 8 runoff Democratic primary election between Senator Blanche Lincoln and Lieutenant Governor Bill Halter.

The union is sending about 50 staffers to Arkansas for the race's last three weeks, with a particular focus on rallying African-American voters behind Halter, the president, Gerald McEntee, said, describing an independent expenditure campaign on a scale likely to dominate the state's airwaves.

McEntee also told Ben Smith that AFSCME wants to send "a shot across the bow of other Democrats" who may be considering voting against labor interests the way Lincoln has. (To cite one example, Lincoln is among several Senate Democrats who voted for the Employee Free Choice Act in 2007 but backed away from it under a Democratic president.)

Lincoln's biggest weapon in the runoff campaign is President Bill Clinton, who plans to return to Arkansas to campaign for her on May 28. She will also tout the strong language on regulating derivatives that she pushed as part of the financial reform bill just approved in the Senate.

Halter finished only slightly behind Lincoln in the May 18 primary, with 43 percent of the vote to Lincoln's 45 percent. Conservative Democrat D.C. Morrison won about 13 percent and has said he won't endorse a candidate in the runoff. Halter gained rapidly on Lincoln in the past month:

Momentum is with Halter, and even with Bill Clinton behind her, it won't be easy for Lincoln to turn things around. That said, I wouldn't get too excited about the overnight survey Democracy for America commissioned from Research 2000, which showed Halter ahead of Lincoln among likely runoff voters. Over at Pollster.com, Mark Blumenthal argues that the question wording and order in that poll may have "primed" respondents to support Halter. Markos Moulitsas says Daily Kos will commission another Research 2000 poll of the Arkansas race next week, presumably asking the vote preference question before any issue questions.

Any thoughts on the Arkansas race are welcome in this thread. I'm supporting Halter not only because he is a better Democrat, but also because he polls better against Republican John Boozman. Even with Halter as the nominee, Boozman would be favored to win this seat, though.

Pennsylvania, Kentucky, Arkansas, Hawaii election day thread

Conventional wisdom says Senator Arlen Specter needs relatively high turnout today to prevail against his Democratic challenger Joe Sestak, who has gained a lot of support in the last month and has a narrow lead in the polling average. It's been rainy today in the Philadelphia area, which isn't good for turnout, but many people may vote after work if it clears up a little. I learned from Michael McAuliff that there's a large ethnic Slovak population in the Pittsburgh area, which could give an edge to Sestak if turnout is high. I hope Sestak will win, but I don't feel confident about that at all.

Swing State Project previews the other Pennsylvania races here. The special election to fill Jack Murtha's seat in PA-12 will attract the most attention. it's the only House district in the country that voted for John Kerry in 2004 and John McCain in 2008. Jeffmd posted pretty district maps and analysis here.

In Kentucky's Senate race, it looks like the Republican primary will end with a humiliating defeat for the establishment candidate, Trey Grayson. Rand Paul is the very likely winner there. In the Democratic primary, the more progressive and probably more electable Jack Conway has been gaining on Dan Mongiardo in the polls, but it looks too close to call.

In Arkansas, Senator Blanche Lincoln had to fill out a provisional ballot at her polling station, because she had requested an absentee ballot and not returned it. Oops! Unfortunately, she seems to have a comfortable lead over Bill Halter. The main question today is whether she will be kept under 50 percent of the vote, forcing a runoff election. Also unfortunately, Congressman John Boozman, the strongest potential Republican candidate, looks set to win the GOP primary easily.

The special election in Hawaii's first district is just a disaster. Ed Case should not have jumped into this race when most of the locals had already backed Colleen Hannabusa. As a result, those two are going to split the Democratic vote, and Republican Charles Djou will win a plurality. DavidNYC is also right; Neil Abercrombie should not have resigned from this seat, which forced the special election. He should have either held the seat while running for governor or declined to seek re-election in 2008. Let's hope we can win this seat back in November with the Democratic vote united behind one candidate.

Post any comments, predictions or tips on election results sites in this thread.

CORRECTION: Ballots for the Hawaii special election will count if they arrive in the mail by Saturday, May 22.

UPDATE: Conway leads in Kentucky with more than two-thirds of the precincts in, but his strongest areas appear to have reported already. The number crunchers at Swing State Project predict he will win narrowly, but it's too early to know.

UPDATE: Politico is continually updating results here. Conway leads by about 20,000 votes (46 percent to 41 percent) with nearly 80 percent of precincts reporting. Rand Paul easily won the Republican primary with nearly 60 percent of the votes that have been counted.

UPDATE: The Kentucky Democratic primary has been called for Jack Conway, who leads by about 5,500 votes. It's been a while since Democrats won a U.S. Senate election in Kentucky, but the Conway/Paul matchup is the most favorable one we could have hoped for.

The Pennsylvania Democratic primary has been called for Joe Sestak, who leads 53 percent to 47 percent (about 44,000 votes) with 74 percent of precincts reporting. Specker didn't get the turnout he needed in Philadelphia.

With about 21 percent of precincts reporting in Arkansas, Lincoln leads Halter 45 percent to 41 percent. If those numbers hold, the race is headed to a runoff. I have no idea what part of the state has already reported.

UPDATE: Conservative Democrat Mark Critz has beaten Tim Burns in the special election to serve out the remainder of Murtha's term in PA-12. The same two candidates won their parties' respective primaries, so will face off in November. The Democratic Congressional Campaign Committee will be very pleased to have won this one, especially given the likely outcome in HI-01.

MORNING UPDATE: With almost all the votes counted in Arkansas, Lincoln leads Halter by 44.5 percent to 42.5 percent, with D.C. Morrison taking in 13 percent. (Boozman avoided a runoff on the Republican side.) The next three weeks will be tricky for Lincoln to navigate. I also have to wonder whether the president will cut more ads for her or make a campaign visit. Toward the end of the Pennsylvania race Obama didn't do much for Arlen Specter despite earlier promises from the White House.

Critz's margin over Burns was 53 percent to 45 percent in an R+1 district where Obama's approval is only around 33 percent. I have to agree with Matt Lewis, who said last night, "Republicans should be very concerned about the margin of defeat in PA-12. NRCC has major questions to confront." I also think we'll see President Bill Clinton campaigning for Democratic candidates in a lot of rural and/or working-class districts this fall. Stumping for Critz on Sunday, Clinton told the crowd, "Maybe [Burns] should move to California, if he wants to run against Nancy Pelosi."

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