Bluestem Prairie: news about Tim Walz (MN-1)

Rothenberg Report drops Minnesota First from competitive races list

A kind reader just sent us news (via MN Indy) that the Rothenberg Report has dropped Minnesota First from its Competitive Races list.

At the MN Indy, Paul Demko writes:

The Rothenberg Political Report has dropped Minnesota’s First Congressional District from its list of competitive House races. This means it believes freshman Democratic Rep. Tim Walz is in little danger of losing his re-election bid. Previously Rothenberg had assessed the contest as favoring the incumbent, who is being challenged by medical doctor Brian Davis.

Guess it must have been Walz's fade in his rival's polling that did the trick. Another good reason for a little more cover music from The Boss to celebrate:

Caution: it's easy for news like this to create the apathy that Minnesota Central warns against. Help persuade other political race handicappers to move their predictions for this race more toward Congressman Walz's favor by making a contribution by midnight tonight, then volunteer for voter contact and GOTV for Walz.

Give now: FEC reporting period ends

Yesterday, we took up an invitation from a friend in Rochester's medical community to attend a house party for Congressman Walz. For those of us who love farmland and wetlands, there's little more lovely than the drive we took on the back roads to Rochester.

Sure, we had to pause occasionally for a behemoth combine to move out of the way, but we'd worked some extra time for implement dodging in our schedule since guys are harvesting beans.

Some of the best food ever at a fundraiser, in a home surrounded by a moat of hostas. Those I talked to were appreciative of the congressman's positive ads and approach to the campaign, as well as his work in Washington. We're told that the bulk of the individual contributions to Walz's re-election comes in at such gatherings in middle class homes.

Those who want to keep Congressman Walz fighting for Main Street and the middle class (and the aspirations of those citizens who hope to join it) should consider contributing by midnight today, the last day of the October quarterly reporting period. Due October 15, the next report will detail giving and spending from August 21 through September 30.

The other great part of a road trip is singing along to the shuffle. Here's one great tune of many served up yesterday on the dark drive home, dedicated to all those who work together to make this country better for their children and grandchildren--especially to Leah on this holy day:

Rochester Area Chamber of Commerce Walz-Davis debate to be re-scheduled

Since the House will be reconvening on October 2 at noon Eastern time and Congressman Walz will be in Washington, the Rochester Area Chamber of Commerce will be rescheduling Thursday's debate, the RACC confirmed in a phone call.

Those who have registered will be notified of the new day and time via email. If we understand arrangements correctly, the good people at The Uptake will be live at the debate.

Given the interesting business climate, this should prove worth watching. We recommend that those who can should attend the event.

Update: The kind and professional people at the RACoC have posted the following note on the chamber's web site:

Due to Congress being called back to Washington D.C. on Thursday to address the United States financial crisis the debate between Brian Davis and Tim Walz scheduled for this Thursday at noon has been postponed.

The Chamber will announce a new debate date as soon as it has been rescheduled.

Fail-out news coverage round-up: Walz votes no on bailout

The Strib reports A bitter pill draws a bipartisan refusal. The PiPress examines at How they voted and takes statements. Ed Felker at the Post Bulletin notes Walz votes against bailout proposal Monday; Kline votes in favor.

The Worthington Globe says Bailout splits Minnesota lawmakers.  Walz quote:

“The bill we voted on today passes the buck when it comes to recouping the losses taxpayers might suffer,” Walz said. “I also regret that this bill does not do enough to help average homeowners, or provide sufficient oversight of Wall Street.”

The Winona Daily News reports Walz, Davis oppose bailout.  The Mankato Free Press provides more details on why Walz, Davis oppose bailout plan. We look at Davis's fable here. The MFP editorial board says Bailout has little Main Street support.

House defeats bailout; Dow drops in the Albert Lea Tribune. The Austin Herald runs Walz's statement in Rep. Walz votes no on bailout.

ECM Publishers, which owns the Caledonia Argus, reports Minnesota congressional delegation forms unusual grouping in vote on financial bailout.

KEYC-TV  broadcast Walz Discusses Vote on Bailout. KAAL-TV covered the vote in Tim Walz on Bailout Plan. SW Minnesota viewers heard about it via KSFY in Why They Voted "No". Walz's vote lined up withthat of South Dakota's Herseth and Iowa's Steve King.

MinnPost looks at the split. Its Daily Glean provides a fine wrap up of Twin Cities coverage in A trillion little pieces: why Minnesota partisans splintered on bailout. The MN Indy reports House rejects bailout package; Minnesota delegation splits its votes.

 

Economic know-nothingism: Davis blames CRA for market woes

Representatives Bachmann and Ellison have already engaged in a call and response about the alleged role of the Community Reinvestment Act in shaping the current financial climate.

Turns out that Bachmann's statement was a dog whistle for her BFF Brian Davis, the GOP candidate in MN-01. He supplied the reprise to the Mankato Free Press:

Walz’s Republican opponent agreed with the vote, but placed most of the blame for the financial crisis on government — including actions by the Clinton administration to promote low-income home ownership — rather than Wall Street.

“I’m pleased to see the bailout was rejected,” said Brian Davis, R-Rochester, not faulting Walz’s vote. “I imagine he and I propose a different solution to all this.”

Davis said large amounts of taxpayer money should not be risked on a bailout plan until underlying causes of the subprime mortgage mess are identified and fixed.

Davis focused first on the Community Reinvestment Act, originally passed in 1977 to prohibit lenders from avoiding offering loans in low-income areas. The administration of President Bill Clinton became aggressive in enforcing the act, pressuring banks to offer mortgages to risky applicants, Davis said.

“That’s what started it,” he said.

Congresswoman Michele Bachmann, a Minnesota Republican, came under criticism last week when she also placed blame on the Community Reinvestment Act. Bachmann said during a congressional hearing that the Clinton administration pushed the issuance of home loans “on the basis of race and little else,” according to the newspaper Roll Call.

The comment prompted the Congressional Black Caucus to write a letter to House Minority Leader John Boehner rejecting the “assertion that ‘minorities’ caused the current financial crisis.”

Davis said he doesn’t oppose the idea of promoting responsible lending to low-income groups but believes the Clinton administration was too aggressive in pushing the idea.

“The goals of the program are laudable,” he said.

We'll have more debunking this new article of right wing faith, but let's start with Business Week's Aaron Pressman in Community Reinvestment Act had nothing to do with subprime crisis. We post the entirety for our click-impaired readers:

Fresh off the false and politicized attack on Fannie Mae and Freddie Mac, today we’re hearing the know-nothings blame the subprime crisis on the Community Reinvestment Act — a 30-year-old law that was actually weakened by the Bush administration just as the worst lending wave began. This is even more ridiculous than blaming Freddie and Fannie.

The Community Reinvestment Act, passed in 1977, requires banks to lend in the low-income neighborhoods where they take deposits. Just the idea that a lending crisis created from 2004 to 2007 was caused by a 1977 law is silly. But it’s even more ridiculous when you consider that most subprime loans were made by firms that aren’t subject to the CRA. University of Michigan law professor Michael Barr testified back in February before the House Committee on Financial Services that 50% of subprime loans were made by mortgage service companies not subject comprehensive federal supervision and another 30% were made by affiliates of banks or thrifts which are not subject to routine supervision or examinations. As former Fed Governor Ned Gramlich said in an August, 2007, speech shortly before he passed away: “In the subprime market where we badly need supervision, a majority of loans are made with very little supervision. It is like a city with a murder law, but no cops on the beat.”

Not surprisingly given the higher degree of supervision, loans made under the CRA program were made in a more responsible way than other subprime loans. CRA loans carried lower rates than other subprime loans and were less likely to end up securitized into the mortgage-backed securities that have caused so many losses, according to a recent study by the law firm Traiger & Hinckley (PDF file here).

Finally, keep in mind that the Bush administration has been weakening CRA enforcement and the law’s reach since the day it took office. The CRA was at its strongest in the 1990s, under the Clinton administration, a period when subprime loans performed quite well. It was only after the Bush administration cut back on CRA enforcement that problems arose, a timing issue which should stop those blaming the law dead in their tracks. The Federal Reserve, too, did nothing but encourage the wild west of lending in recent years. It wasn’t until the middle of 2007 that the Fed decided it was time to crack down on abusive pratices in the subprime lending market. Oops.

Better targets for blame in government circles might be the 2000 law which ensured that credit default swaps would remain unregulated, the SEC’s puzzling 2004 decision to allow the largest brokerage firms to borrow upwards of 30 times their capital and that same agency’s failure to oversee those brokerage firms in subsequent years as many gorged on subprime debt. (Barry Ritholtz had an excellent and more comprehensive survey of how Washington contributed to the crisis in this week’s Barron’s.)

There’s plenty more good reading on the CRA and the subprime crisis out in the blogosphere. Ellen Seidman, who headed the Office of Thrift Supervision in the late 90s, has written several fact-filled posts about the CRA controversey, including one just last week. University of Oregon professor and economist Mark Thoma has also defended the CRA on his blog. I also learned something from a post back in April by Robert Gordon, a senior fellow at the Center for American Progress, which ends with this ditty:

It’s telling that, amid all the recent recriminations, even lenders have not fingered CRA. That’s because CRA didn’t bring about the reckless lending at the heart of the crisis. Just as sub-prime lending was exploding, CRA was losing force and relevance. And the worst offenders, the independent mortgage companies, were never subject to CRA — or any federal regulator. Law didn’t make them lend. The profit motive did. And that is not political correctness. It is correctness.

Enough said.The Free Press article, Walz, Davis oppose bailout plan, reports on Walz's reasons for his no vote as well.

Photo: Brian Davis and his financial advisor, Rep. Michele Bachmann.  She's back in the news today--this time for deflating a bubbling GOP talking point about yesterday's failied vote. See Roll Call's Bachmann Inadvertently Knocks Down GOP Explanation. My, my. 

Walz statement on bailout vote

From the congressional office:

(Washington, D.C.) – Today, Congressman Tim Walz voted against the revised Wall Street bailout plan released yesterday by Congressional leadership.  Walz made the following remarks about the proposed bailout:

“Speaker Pelosi and the Democratic negotiators deserve credit for the progress they made on this bill.  This extensive rescue package has many more protections for taxpayers than the 3-page bailout proposal put forth by the White House last week. 

“In the last week, I’ve personally called over 100 constituents, bankers and business leaders in southern Minnesota to sound them out about this bailout package.  The message I’ve heard from them is clear: despite the many and significant improvements made by Democratic negotiators, this bill still falls short. 

“The bill we voted on today passes the buck when it comes to recouping the losses taxpayers might suffer.  I also regret that this bill does not do enough to help average homeowners, or provide sufficient oversight of Wall Street.

“Wall Street got us into this mess and I hope that the Congressional leadership will go back to the drawing board and write a bill that holds Wall Street accountable, both through sensible regulation and oversight and by restricting the excessive golden parachutes for CEOs who got themselves in trouble. 

“My job is to protect the American taxpayer and this plan doesn't go far enough in looking out for the middle class. It doesn't go far enough in holding Wall Street accountable. If Wall Street is going to get our money, we need to have some protections in place, and this plan doesn't go far enough. Finally, it does not do enough to help address the real cause of our economic crisis: the tidal wave of foreclosures that are hurting families and neighborhoods all around the country.

“I voted against this bill because it wasn't a good deal for taxpayers. Lawmakers need to go back to the table immediately and come up with a much better deal for taxpayers and the middle class.”

Update Sept 30: The Mankato Free Press takes a look at why Walz, Davis oppose bailout plan. We look at Davis's fable here.

Walz votes no on bailout

We've been informed that Congressman Walz voted against the bailout.

Update: Here's the Roll Call vote. Walz and Collin Peterson joined  Jim Ramstad, Michele Bachmann and John Kline in voting against the bill; Kline, McCollum, Ellison and Oberstar voted in favor.

For those who click through and wonder about the seem unrelated nature of the bill, the Library of Congress's Thomas provides this note:

Note: According to the House Majority Leader, H.R.3997 will be used as the vehicle for the Emergency Economic Stabilization Act of 2008. See documents on the House Financial Services Committee website and H.Res.1517 on the House Rules Committee website.

Thanks to he-who-cannot-be-named in NW Minnesota for the correction.

Update Sept 30: The Mankato Free Press takes a look at why Walz, Davis oppose bailout plan. We look at Davis's fable here.
 

Bailout vote likely today

Update: In Why Bail? The Banks Have a Gun Pointed at Their Head and Are Threatening to Pull the Trigger, Dean Baker can't find a single real reason to support the bill.[end update]

The Pioneer Press reports in  Minnesota delegation gives tepid support to the Economic Stabilization Act of 2008:

Members of Minnesota's delegation to Congress scrambled Sunday to digest details of the multibillion-dollar Wall Street rescue package. They weren't alone — so many people tried to download copies of the measure Sunday that the congressional computer servers crashed.

Members of Congress didn't have much time. The House is slated to vote on it perhaps as soon as today; the Senate vote is expected in a few days. . . .

The article relates the positions of McCollum, Coleman, Oberstar and Bachmann. Finally:

Rep. Tim Walz, D-Mankato, said the measure, which he was still studying Sunday night, made progress over the version proposed earlier, but he still was unsure about his support.

"I remain skeptical and am working with my colleagues to get answers to my questions about exactly how this plan will work," he said. "We must move fast to bring stability to the financial markets, but we must get it right."

The Washington Post has put a pdf of the bill online.

The New York Times says that House minority leader John Boehner is encouraging Republicans to support the bill:

On Sunday evening, both parties convened closed-door sessions in the House to review the plan, and conservative House Republicans remained a potential impediment.

But the party leadership was circulating information aimed at refuting some of the main criticisms of the bailout, indicating they were poised to support it. “I am encouraging every member of our conference whose conscience will allow them to support this bill,” said Representative John A. Boehner of Ohio, the Republican leader.

The Washington Post says in Broad Authority, Lots of Money And Uncertainty:

Congress is on the verge of granting Treasury Secretary Henry M. Paulson Jr. sweeping powers to stabilize the nation's financial system. He would stand largely unfettered by traditional rules, largely unrestricted in his ability to spend $700 billion of federal money. . . .

And in Dr. Paulson's Tough Medicine, In a Pill the Public Can Swallow (yeah,right):

But nobody should view even this effort as sufficient to keep the U.S. economy out of recession, stabilize housing markets or prevent the failure of additional banks, investment houses, insurers and hedge funds. Although more than $600 billion in private-sector credit losses have already been posted, a number of private and public-sector analysts now estimate that won't be even half the final tab from the bursting of the greatest credit bubble the world has seen.

The National Post (Canada) reminds us that hopes of profits to taxpayers from past bailouts were not realized:

But, if history is any guide, taxpayers may end up losing a substantial chunk of the US$700-billion.

A report by the International Monetary Fund found that in past bailouts, the average recovery rate had been only 18%.

We hope that Congressman Walz acts on his skepticism. This bill doesn't look to have strong enough safeguards for the taxpayers and it's important to get it right.

First District residents should let him know what they want.

Sunday early afternoon digest: home in the valley edition

Update: we've read that servers on the Hill are getting slammed, so here's a mirror provided by the helpful good people at the Sunlight Foundation (pdf); embedded version here. end update.

News reports say that negotiators in Washington have reached an agreement on proposals to aid Wall Street. The final language has yet to be released to the public (and may indeed still be incomplete). When done, the deal will be posted here: http://financialservices.house.gov/.  (Isn't Michele Bachmann on that committee?)

From what we're reading in the papers, we're inclined to say  that Minnesota's congressional delegation should say no, but we withhold final judgment until the written details are made public.  Congressman Walz's constituents should let him know what they think. Contact information here.

It's times like this that we are grateful for once having dated a bank examiner for the FDIC.  Who knew that pillow talk would come in handy?

The Albert Lea Tribune reports in People using absentees can vote next week:

In Minnesota, people can vote absentee if they will be absent from the precinct the day of the election, if they have an illness or disability that disables them from coming out to vote or if they are serving as an election judge in another precinct.

Another reason people can vote via absentee is because of a religious discipline, religious holiday or observance. The last reason is if there is an eligible emergency declared by the governor or a quarantine declared by the federal or state government.

Martinson said a large number of people who vote with absentee ballots in this area are absent from the precinct and are in other states at the time of the actual election. There’s also a fair share of college students and others with disabilities that vote via absentee.

For more information on absentee voting, check out the details at the Minnesota Secretary of State's Voter Information page. Be very wary of requests for absentee ballots sent to you in mass mailings by a campaign or political party, as mischief has been reported elsewhere in the country in such devices.

Walz supporter Ron Yezzi writes the Mankato Free Press to say Walz not too liberal, concluding:

I strongly support Walz’s reelection. He’s an amazingly gifted person totally dedicated to serving the public interest with openness and fairness. His outstanding first term shows he can work effectively on the nation’s problems and he has the potential to attain national political stature. But if he ever gets derailed, it should not be because voters make the mistake of thinking he’s too liberal for the 1st District.

The Rochester Democrat notes that Walz Hails Passage of Second Economic Stimulus Package. Go read the details there.

Just across the river from the LaCrescent area, Sen. Obama stopping by La Crosse on Wednesday.

A little ditty to lighten up the day, from Minnesota's most prominent songbird:

Farewell, Paul Newman

Paul Newman, one of Hollywood's icons, has passed away. In his memory, a traditional folk hymn:

And this more reverent folk tune, sung by Harry Dean Stanton: