POLITICS NOVEMBER 16, 2012
THE 2012 ELECTIONS were a little bit like Groundhog Day. After spending an estimated $5.8 billion on the House, Senate, and presidential elections, America woke up on November 7 to find that the president was still Barack Obama, the Senate was still Democratic, the House retained a slightly smaller Republican majority, and prospects for bipartisan cooperation remained as slim as ever. In a post-election statement, Senate Republican leader Mitch McConnell called on Obama “to propose solutions that actually have a chance of passing ... and deliver in a way that he did not in his first four years in office.” Translation: “We still see no reason to cooperate with you.”
One circumstance, however, has changed. With the election over, the president can now take bolder action on a host of domestic issues that don’t require cooperation—or even input—from Congress. Though some of these actions might be controversial, that concern matters less now that Obama has faced voters for the last time. What follows are eight policies that the executive branch can carry out on its own, in many cases immediately. Obama will almost certainly do some of these. Others require a bit more gumption. He should do those, too.
Cut Carbon Emissions
HURRICANE SANDY lent urgency to the Obama administration’s stated goal of grappling with climate change. While cap-and-trade legislation may have died in Congress, the administration has several powerful tools at its disposal that would limit emissions. One would be to initiate a combined rule governing power plant emissions, the most concentrated source of greenhouse gases in our atmosphere. In March, the Environmental Protection Agency proposed new Clean Air Act regulations for carbon emissions from future power plants. It should link those regulations with a rule governing existing plants, too.
President Obama should also consider permanently canceling the Keystone XL pipeline, a project he put on hold last January. Keystone XL would transmit Canadian oil extracted from tar sands that would release vast amounts of carbon into the atmosphere. In addition, creation of the pipeline would require extensive removal of ancient, carbon-absorbing forest. The final product is, per unit of carbon released, “equivalent to burning coal in your automobile,” according to the NASA climate scientist James Hansen.
Expand “Stealth Amnesty” for Undocumented Workers
IN JUNE, OBAMA announced a change in immigration policy that just may be the reason he won reelection, given his unprecedented support from the swelling ranks of Latino voters. The president instructed the Department of Homeland Security (DHS) to stop initiating deportation of any undocumented person 30 years or younger who arrived in the United States before the age of 16, had lived here for five or more years, and was either in school, a high school graduate (or holder of an equivalency certificate), or a veteran who had been honorably discharged from the military or Coast Guard. Conservatives denounced the move as “stealth amnesty.” If it is, let’s have more of it.
Under a 1996 immigration law, the U.S. government bars anyone caught living here undocumented for six months to a year from reentering the country for three years. Anyone who lives here illegally for more than a year is barred from coming back for a decade. This poses a particular quandary for the undocumented spouses of American citizens. They can’t work here legally unless they apply for a green card, but if they’re undocumented, they must receive that green card in their country of origin. Once they leave the United States, of course, they are barred from returning for three or ten years. So to reunite with their spouses they must entreat a U.S. consulate for a waiver that can take months or years to receive, if it is approved at all. (The consulate in Ciudad Juarez, Mexico, is apparently swamped with requests for such waivers.) In April, DHS issued a proposed rule guaranteeing reentry for family members caught in this Venus flytrap. Release of a final rule is reportedly imminent. President Obama should next consider similar waivers for other categories of undocumented persons, such as agricultural workers. Such leadership could finally pressure Congress to get moving on immigration reform.
Fire Ed DeMarco
APART FROM MITT Romney, there may be no person who had a greater personal stake in Obama’s defeat than Ed DeMarco, acting director of the Federal Housing Finance Agency (FHFA). Even before the election, White House officials were quietly assuring housing advocates that DeMarco would be replaced with a recess appointment as soon as Congress broke for Christmas. DeMarco took over the agency after the director appointed by George W. Bush departed in 2009. He has stayed because Senate Republicans signaled they would block confirmation of any plausible successor. But DeMarco needs to go, because he has resisted necessary action in the form of principal write-downs for underwater mortgages owned by Fannie Mae and Freddie Mac, the two government-sponsored mortgage finance corporations under FHFA conservatorship since the 2008 financial crisis. The slow pace of mortgage debt relief is a primary reason why the economy has recovered so slowly from the Great Recession.
Specifically, DeMarco won’t allow Fannie and Freddie to participate in the underwater-mortgage initiative included in the Obama administration’s Home Affordable Modification Program. He says it would be potentially too costly to Fannie and Freddie and—since the federal government more or less owns them—to taxpayers. Even after the Treasury Department guaranteed offsetting payments—which aren’t strictly necessary, since most analysts believe these principal reductions would save money by avoiding costly foreclosures— DeMarco said no. Treasury Secretary Tim Geithner practically begged DeMarco to change his mind. DeMarco still said no. Now it’s time for Obama to evict this Bartleby from his post.
Reform the Credit-Rating Agencies
THE FEDERAL government is atremble over concerns that Moody’s will soon join Standard & Poor’s in downgrading U.S. treasuries, which the rest of the world correctly regards as the most stable investment on the planet. A more urgent problem is the Obama administration’s excruciatingly slow pace in creating rules, under the Dodd-Frank financial reform law, to overhaul the credit-rating agencies themselves. The Big Three (S&P, Moody’s, and Fitch) behaved quite differently during the run-up to the financial crisis, handing out investment-grade ratings like goody bags to dubious subprime mortgage-backed securities.
The pace of Dodd-Frank rulemaking has been sluggish in general. Most Dodd-Frank rules were required, by law, to be completed more than a year ago. But the Securities and Exchange Commission, plagued by industry lawsuits and inadequate funding due to GOP resistance in Congress, has completed fewer than half the rules for which it’s responsible. Various rules concerning the credit-rating agencies were proposed in May 2011 to govern conflict of interest, internal controls, transparency, and consistency. None of these has been finalized. The president needs to pick up the pace. How will we know whether the patient is getting better if the thermometer is still busted?
Combat Tuition Hikes
IN HIS 2012 State of the Union address, President Obama told college administrators: “If you can’t stop tuition from going up, the funding you get from taxpayers will go down. Higher education can’t be a luxury.” This came on the heels of a meeting on the issue with college presidents. But then Obama changed course, proposing legislation (currently stalled in Congress) that takes the precise opposite approach—extending the Education Department’s “Race to the Top” program to award grants to colleges and universities for controlling costs.
The president had it right the first time. This is a problem that calls for more stick than carrot. The Education Department has taken steps to make college costs more transparent, but the president has to persuade colleges and universities that his threat to withhold federal aid is real. He might start by asking publicly why Gordon Gee, president of Ohio State and the highest-paid university president, pulls down $2 million a year and has been allowed to run up $7.7 million in personal expenses since 2007, according to a recent story in the Dayton Daily News. Or, he could call for an immediate voluntary moratorium on new university construction and pledge that any nonessential construction would threaten future federal aid.
Bring Down Medicare Costs
IF I NEED MY car fixed, the mechanic takes a look and then tells my insurer how much it will cost to repair it. If I need a broken hip fixed, though, the hospital doesn’t tell my insurer how much it will cost. Instead, various parties to the transaction—the internist, the surgeon, the anesthesiologist, the hospital itself—set their own independent meters running. The result is a much higher bill. It’s widely agreed that a preferable solution is to “bundle” payment—that is, pay the hospital one prearranged fixed amount for the whole procedure.
Medicare has experimented with bundling, and one such program, the Acute Care Episode (ACE) demonstration project, has seen particular success. Begun in 2009, the project was conducted in five hospitals around the country, and it’s already lowering costs by up to 6 percent. The single payment is made for several common orthopedic and cardiovascular procedures—hip replacement, pacemaker implantation, angioplasty, etc. Savings are shared with patients to offset a small annual premium charged by Medicare for doctor coverage. Complications and post-operative care are not covered. Under Obamacare, Health and Human Services (HHS) has the power to make bundling a requirement for all Medicare patients undergoing the procedures successfully tested in the ACE project. Obama should have HHS Secretary Kathleen Sebelius do so.
Curtail Child Labor on Farms
THIS PAST APRIL, under pressure from conservative critics, the Labor Department withdrew a proposed rule restricting farm work performed by children under 16 and pledged instead to “develop an educational program to reduce accidents.” The rule would have, among other things, kept kids away from most power-driven equipment, including tractors, and forbidden them to work in confined spaces with dairy bulls, stud horses, and boars. An exemption was made for family farms, but that was overlooked by the right, which depicted the rule as a demolition job on the Little House on the Prairie.
The most important part of the proposed rule barred kids under 18 from grain bins and silos. As John Broder reported recently in The New York Times, silos are hazardous workplaces where a sudden avalanche of corn or wheat can quickly crush or asphyxiate anyone occupying the enclosed space below. Eighty farm-workers have died in silo accidents since 2007; 14 of them were teenagers. Unfortunately, by exempting family farms, the Labor Department turned a blind eye to the setting for most such accidents, 70 percent of which occur on family or small farms. Obama should direct Labor Secretary Hilda Solis to reintroduce the rule, this time removing the family-farm exemption.
Pay All Home Health Care Workers Minimum Wage
THANKS IN LARGE PART to aging baby-boomers, the Bureau of Labor Statistics predicts that demand for nonmedical “personal care aides” will increase 70 percent this decade. That makes home health care one of the fastest-growing occupations in the country, but the pay stinks; the median annual wage is less than $20,000. The reason the median is so low is that a lot of these personal care aides (almost all of them women) earn less than the current minimum wage of $7.25 an hour. Amazingly, their employers aren’t required to pay it.
Under the Fair Labor Standards Act—which regulates wages and hours— babysitters and companions for the elderly and infirm are exempt from a minimum-wage requirement imposed on domestic workers since 1975. The idea was that such work was extremely informal and so its regulation needed to be, too. Even then, though, the job of personal care aide was quite demanding. A person infirm enough to need a “companion” typically requires a lot more than just somebody to hold hands with while watching television. He or she often needs a great deal of assistance with cooking, cleaning, getting around, even personal grooming. Last year, the Obama administration recommended virtual elimination of the elderly-companion exemption. Under the proposed rule, watching television with an elderly person is just about all you can do if your employer pays you less than minimum wage. Now it’s time to issue a final rule. This one isn’t rocket science.
Tim Noah is a senior editor at The New Republic. This article appeared in the December 6, 2012 issue of the magazine under the headline “Hope Solo.”