The Biggest Risk to the Economy in 2012, and What’s the Economy For Anyway? (Robert Reich)
Despite concerns over the eurozone and Iran, Robert Reich argues the real sickness is inside us, and it involves an obsession with buying tons of crap for the best “deals” we can find, even if it undercuts the jobs and wages of American workers.

Freddie Mac Bets Against American Homeowners (ProPublica)
Jesse Eisinger and Chris Arnold report that Freddie Mac is placing multi-million dollar bets that homeowners will remain stuck with high-interest mortgages, making it the Pete Rose of refinancing efforts (though that may not be the whole story).

California’s Harris Seeks Edge in U.S. Foreclosure Standoff (Bloomberg)
California’s AG is holding out for a more thorough investigation before she signs onto the nationwide foreclosure settlement, but critics question whether she’s doing it for the benefit of her constituents or her own future political prospects.

Beyond the Buffett Rule (TAP)
Paul Waldman argues the president’s plan to prevent billionaires from paying lower tax rates than their secretaries by adding more complexity to the tax code doesn’t solve the problem, which is that we treat capital gains as Special Rich People Money.

European Leaders Agree to New Budget Discipline Measures (NYT)
All but two members of the EU have signed onto a compact to enforce stricter fiscal discipline, but many are frustrated that Germany’s fixation on belt-tightening continues to cut off circulation to economies that are badly in need of investment.

Click here to buy Senior Fellow Richard Kirsch’s new book on the epic health care reform battle, Fighting for Our Health.

U.S. Gets Tougher on Debt Collecting (WSJ)
The Federal Trade Commission is cracking down on the new wave of debt collection agencies that treat debtors like Wild West criminals with bounties on their heads, fining one $2.5 million for coercing borrowers to pay debts they didn’t even owe.

Why New Birth Control Benefits are the Right Choice and Why Religious Conservatives Have it Wrong (AlterNet)
June Carbone and Naomi Cahn argue that if the U.S. wants to reduce its unplanned pregnancy rate, the beliefs of a small group of religious employers can’t outweigh the needs of the low-income women who work for but don’t agree with them.

How Newt Gingrich Crippled Congress (The Nation)
Alex Seitz-Wald writes that from extreme partisan gridlock to ridiculous pork barrel projects, pretty much everything we know and loathe about today’s Congress can be traced back to Newt Gingrich’s vision for the glorious Republican Revolution.

Super PACs Now Dominate GOP Primary Campaign Spending (MoJo)
Kevin Drum notes that most candidates probably don’t mind having a few of their best millionaire friends drag their opponents through the mud while their hands stay clean, but it’s not so much fun when you’re getting outspent 60 to 1 like Gingrich.

Wall Street’s gilded frat party (Salon)
Bill Moyers and Michael Winship observe that Wall Street’s induction ceremony to the Kappa Beta Phi fraternity of bankers might as well have ended with a girl dressed like Marie Antoinette popping out of a cake and then telling some poor people to eat it.

- A HUD official has confirmed that the department’s new LGBT protections apply to religious institutions the same as any housing service provider.

- OutServe Magazine’s look at the military’s discrimination against transgender people has now been published online.

- A new Williams Institute report reveals that the number of same-sex couples raising childrencontinues to rise, and these couples “reflect greater racial/ethnic and socioeconomic diversity than often represented in the media and academic research.”

- Anti-gay North Carolina pastor Patrick Wooden defends his obsession with crude sexual actshe believes all gay men do together.

- Responding to New Jersey Gov. Chris Christie’s remarks about voting on civil rights, Rep. John Lewis (GA-D) spoke out that “apparently the governor…has not read his recent history books,” pointing out that “most of the [Southern] governors were outright segregationists.”

- A Tennessee judge has given plaintiffs 30 more days to provide proof that the state’s ban on LGBT nondiscrimination ordinances harms them.

- In another interview, Tennessee Sen. Stacey Campfield (R) — sponsor of the “Don’t Say Gay” bill — continues to show he knows very little about sexual orientation, HIV, or bullying.

- Washington Gov. Chris Gregoire (D) describes correspondence she received from a young gay man who stopped considering suicide after hearing she had announced her support for marriage equality.

- Illinois Republicans continue to push for legislation that would allow religious institutions to deny adoptions to same-sex couples in civil unions.

- The newly Republican-controlled Virginia Senate has defeated a bill that would have protected state employees from discrimination based on sexual orientation.

- The New York Times profile of Tyler Clementi’s anti-gay privacy-invading roommate twists a few of the details.

- Equality activists fighting Minnesota’s marriage discrimination amendment have raised $1.2 million in their campaign so far.

- Canada now has a policy that essentially prohibits transgender people from flying.

- A video from the United Arab Emirates shows a “tutorial” for “scrubbing” a man of his homosexuality.

- Actor James Van Der Beek has been tweeting for equality lately.

- Watch: The View‘s Elisabeth Hasselbeck defends transgender children:

Click here to view the embedded video.

A report from NASA’s James Hansen and two colleagues from the NASA Goddard Institute for Space Studies shows that the 2011 Texas and Oklahoma heat wave—as well as a deadly Moscow heat in 2010—were “a consequence of global warming because their likelihood was negligible prior to the recent rapid global warming.” [Inside Climate News]

A new NASA study underscores the fact that greenhouse gases generated by human activity — not changes in solar activity — are the primary force driving global warming. [Science Daily]

January has been an unusually violent month for tornadoes in the USA: 70 twisters have been reported. [USA Today]

Weather is growing more unpredictable and extreme, said Mathew Barlow, professor of UMass Lowell’s Environmental, Earth and Atmospheric Sciences Department, an expert in climate-change studies. [Lowell Sentinel and Enterprise]

As time goes on, climate change will have an increasingly major impact on biological diversity, and nowhere more so than in Arctic and alpine environments, which are exposed to the most extreme climate changes. [PhysOrg]

A drought that a government official called the most severe Mexico had ever faced has left two million people without access to water and, coupled with a cold snap, has devastated cropland in nearly half of the country. [NYT]

This week, Energy Secretary Steven Chu, Deputy Secretary Daniel Poneman and other senior Energy Department officials will participate in events across the country to highlight President Obama’s State of the Union address and discuss the Obama Administration’s commitment to renewable energy, natural gas, and nuclear power. [DOE]

The oil companies that are causing climate change have climate adaptation strategies in place. [Triple Pundit]

Rep. Cliff Stearns (R-FL), who is heading the GOP probe of the failed solar company Solyndra, said Republicans are meeting this week to discuss contempt charges against the White House over its response to last year’s subpoena for documents. [The Hill]

In a visit to Harvard, Secretary of the Navy Ray Mabus spoke about the Navy’s commitment to alternative energy at Harvard Business School on Monday evening. [The Crimson]

On the day the Deepwater Horizon sank, BP officials warned in internal e-mails that if the well was not protected by the blowout preventer, crude oil could burst into the Gulf of Mexico at a rate of 3.4 million gallons a day — an amount a million gallons more than what the government later said it believed had spilled daily from the site. [NYT]

Gasoline prices, already at record levels for January, rose again over the last week, the Energy Department said. [LA Times]

At least 30 people have died in the past five days in a cold snap in Ukraine that has brought temperatures down to minus 33 Celsius (minus 27 Fahrenheit), the Emergencies Ministry said Tuesday. [Reuters]

Analysts polled by Reuters expect prices of corn, soybeans and wheat to tumble as much as 15 percent from a year ago, which will benefit companies that produce meat like Pilgrim’s Pride Corp, Sanderson Farms, and Tyson Foods Inc in terms of lower feed costs. [Reuters]

MORNING MESSAGE: China Cheats—Push May Come To Shove

OurFuture.org’s Robert Borosage: China cheats and everyone knows it. Pressures are building on the administration to start enforcing our trade laws. Republican presidential aspirant Mitt Romney says he’ll cite China as a currency violator on day one of his presidency. In his State of the Union address, President Obama announced he would set up a special unit to enforce trade laws, calling out China by name. Now a coalition of unions led by the United Steelworkers and the United Auto Workers, along with allied organizations are joining with Senators Sherrod Brown and Debbie Stabenow to call the question.

Trade Battles with China

TPM’s Josh Marshall reports: On Monday, the U.S. Commerce Department announced it had found “reasonable basis to believe or suspect” that Chinese subsidies of solar panels imported to the U.S. were in violation of international trade agreements. … A big part of the reason the Commerce Department announced its decision today is precisely because it observed the Chinese manufacturers drastically increasing the volume of imports to the U.S. over the past few months — up nearly 15 percent in the case of at least two companies — following the original complaint from U.S. solar panel companies in October of dumping by Chinese manufacturers.

World Trade Organization orders China to stop export taxes on minerals. New York Times: ”The legal setback for Beijing could set a precedent for the West to challenge China’s export restrictions on other natural resources, including rare earth metals that are crucial to many modern technologies, trade experts said.”

Florida Vote: From SuperPACs to Super Crash

Political spending shifts from campaigns to superPACs, reports Jed Lewison at DailyKos: ”… A new study shows that while the amount of advertising so far in the Republican presidential primary is on the same level as 2008, a much larger portion of it is now being funded by outside groups. in 2008, 97.4 percent of the money was spent by campaigns themselves—just 2.6 percent by outside groups. In 2012, 56.4 percent of the money was spent by campaigns—43.6 percent by outside groups, a nearly 17-fold increase for outside groups as a share of total ad spending. Even though total spending decreased by 42 percent, spending by outside groups increased 1,281.8 percent.”

Ed Kilgore at Political Animal links to a chart on superPAC spending.

Who’s behind all of this superPAC spending? As Christian Science Monitor reports, “The secret donors funding a flood of negative ads in the 2012 presidential race are supposed to go public Tuesday. But loopholes in federal disclosure rules mean that Americans will still be left largely in the dark about who is financing what.”

The super crash in housing a big issue in Florida. Bloomberg Businessweek: “Twenty-three percent of mortgaged homes in Florida, the fourth-most populous state, are delinquent or foreclosed upon, more than in any other state, according to Jacksonville-based Lender Processing Services. Florida ranks third in the portion of homeowners with underwater mortgages — with 44 percent of properties valued at less than the loans — according to Santa Ana, California-based CoreLogic data from the third quarter. In a state that helped elect President Barack Obama in 2008, home prices declined 22.5 percent from the first quarter of 2009, when he was inaugurated, through the third quarter of 2011, according to the Bloomberg Economic Evaluation of States index.”

Who will win Florida tonight? Steve Singiser at DailyKos does a polling roundup. ”Well, maybe it is tightening, and Newt Gingrich is back within the margin of error. Or maybe Mitt Romney is now staked to a 20-point advantage. As has happened fairly often in this bizarre primary cycle, there is a poll out there on election eve to suit your favored meme.”

The American Prospect’s Bob Moser on “Newt’s fatal flaw”: “Gingrich’s only chance to take the nomination is as the leader of a movement—loosely defined, the Tea Party movement—and he spoke to its anti-elitist streak powerfully in his dramatic victory in South Carolina. But you can’t lead a movement when everything you say eventually comes back to you, above all else. It can’t be my outrage; it has to be our outrage. But instead of effectively casting the Romney campaign as the enemy of all anti-establishment conservatives—as Sarah Palin and Herman Cain tried to do for him over the weekend—Gingrich seems incapable of putting the brakes on his megalomania.”

TheLoop 21′s Keli Goff says three words—”I didn’t inherit”—will cost Mitt Romney the election.

More Mortgage Fraud Settlement Fears

Nevada’s attorney general is pushing back with concerns and questions about a settlement over allegations of widespread mortgage fraud, HuffPo’s Loren Berlin reports. “In a letter sent Friday, emailed to federal officials and obtained by The Huffington Post, Nevada’s attorney general, Catherine Cortez Masto, asked 38 questions relating to a variety of concerns, including fears that states would play second fiddle to the federal government in making decisions. She also questioned if states would lose their ability to pursue certain types of lawsuits against banks and whether states would get their fair share of the housing assistance for their borrowers. ”

California’s Attorney General Kamala Harris seeks “edge” in settlement talks, according to Bloomberg. ”By Harris’s own reckoning, her reluctance to sign onto a deal and any investigation she might pursue risk deepening the “blight and despair” for many of the 2.2 million California homeowners whom she has said are “holding on by their fingernails.” Still, she is pushing a broader probe of banks’ mortgage practices, including securitization of the loans. … She spoke of having an investigator’s penchant to leave no stone unturned in learning what banks told homeowners when they entered into loans, and how documentation of the transactions measured up to what mortgage holders believed to be the terms of the agreement.”

USA Today offers a Q&A on the issues surrounding the mortgage settlement.

Freddie Mac’s Bets against Homeowners

ProPublica/NPR follow-up to story that Freddie Mac was buying securities that served as an incentive against helping homeowners get out of high-interest-rate loans. “Freddie Mac agreed last month to stop making new bets against American homeowners after its regulator, the Federal Housing Finance Agency, raised concerns … Separately, the White House said the Department of the Treasury is “looking into” Freddie’s investments, and at least three senators called on Freddie not to bet against struggling homeowners.”

The White House confirms it is investigating Freddie Mac bets against homeowners (New York Times).

Felix Salmon: “The Freddie Mac rule certainly maximizes Freddie Mac’s income, but it’s dreadful and unfair public policy. At the same time, it’s also policy which is very much in line with the FHFA’s stance on principal reduction, or anything else which might help homeowners. Given the choice between extracting short-term cashflows from homeowners, on the one hand, and improving the all-over health of the housing market, on the other, the FHFA will always choose the former.”

Contrarian view from Yves Smith: ”The storyline in this piece is neat, plausible, and utterly wrong. And my e-mail traffic indicates that people who are reasonably finance savvy but don’t know the mortgage bond space have bought the uninformed and conspiratorial ProPublica thesis hook, line, and sinker.”

Unemployment Compensation Fight

States now paying the price for not collecting enough from businesses to pay unemployment claims. Center for Budget and Policy Priorities: ”Businesses in 20 states must make the first payment [today] on about $35 billion that these states have borrowed from the federal government in recent years to help pay unemployment insurance (UI) benefits. Most of this borrowing happened because many states kept the business taxes that fund UI benefits too low before the recession, leaving their UI reserves ill prepared for an economic slump.”

House to vote this week on extending a federal pay freeze to help pay for extension of unemployment benefits. The Washington Post: “The vote comes as a new government report shows that federal employees on average earn about 2 percent more than private sector employees in a comparable profession. When pension and health benefits are factored in, federal employees earn about 16 percent more in total compensation than private sector workers, according to the Congressional Budget Office.”

Breakfast Sides

Mitch McConnell’s revisionist history: Congress gave President Obama everything he wanted in 2009-2010. False, says Sahil Kapur at Talking Points Memo: ”This isn’t a new claim for McConnell, but it’s audacious even by Washington’s lax standards. It was McConnell, after all, who led Senate Republicans in serial filibusters — a record-setting number — successfully thwarting large chunks of Obama’s agenda. By forcing Democrats to find 60 votes to nearly every action, McConnell and his members were able to block major initiatives including climate change and immigration reform bills, various appropriations bills, myriad presidential appointments, and arguably also a Democratic effort to let the Bush tax cuts expire for high incomes. Meanwhile, big legislative items that did pass, such as health care reform and the economic stimulus package, were notably scaled back as a result of the GOP filibusters.”

Is your local weathercaster peddling the right-wing line against climate change? Huffpo’s Lynne Peoples reports: ”Recent studies have found that more than half of the reporters relaying weather on television do not believe humans are the primary drivers of global warming — despite a consensus among scientists who specialize on the topic. … A new campaign called “Forecast the Facts,” begun by Citizen Engagement Lab with the support of the League of Conservation Voters and the climate advocacy group 350.org, aims to call out on-air climate deniers.”

Mother Jones examines the Tea Party plan to save Wisconsin Gov. Scott Walker from defeat in a recall. ”Tea partiers at the state and national levels are rallying around Walker’s recall defense, hoping a victory could bolster the movement in a critical election year. … In recent months, the Tea Party Express, a national organization, and the Campaign to Defeat Barack Obama, a tea party-linked political action committee, have waded into the recall fight, blasting out more than a dozen emails to supporters and launching a $100,000 “money bomb” fundraiser to help defend Walker.”

President Obama has proposed a specific new minimum tax rate for millionaires. Should America’s rich feel angry or relieved? We check the IRS tax data archives for an answer.

The most famous secretary in America works “just as hard” as her billionaire boss — according to her boss, investor Warren Buffett — but pays federal taxes at twice the rate her boss does.

Debbie Bosanek, America learned last week, has been working for billionaire Buffett since 1993. In 2010 she paid 35.8 percent of her income in federal income and payroll taxes. Buffett paid his federal taxes at a 17.4 percent rate.

GOP White House hopeful Mitt Romney sits with Buffett in America’s richest 0.006 percent of taxpayers. Romney, America also learned last week, paid his federal income taxes for 2010 at a mere 13.9 percent rate.

At what rate should wealthy Americans like Warren and Mitt pay their taxes? President Obama last week suggested — for the first time — a specific minimum percentage for what he has been calling, since last fall, the “Buffett rule.”

“Tax reform should follow the Buffett rule,” Obama proposed in his state of the union address. “If you make more than $1 million a year, you should not pay less than 30 percent in taxes.”

The Obama administration will be advancing legislation that fixes this 30 percent figure into law. In effect, a new 30 percent “Buffett rule” minimum would replace the current “alternative minimum tax,” a levy enacted in 1969 that no longer operates as any sort of effective check on super rich tax avoidance.

Would this new 30 percent minimum have an appreciable real-world impact? The Obama administration last week declined to estimate how much new revenue a 30 percent Buffett rule might raise from America’s millionaires.

But we can get a sense of what that impact might be by applying a 30 percent minimum to previous years. In 2009, the latest year with IRS data available, taxpayers reporting over $1 million in income paid an average 24.4 percent of their incomes in federal income tax.

If a 30 percent minimum had been in effect that year, these taxpayers would have paid, on average, more than $171,000 additional per taxpayer. Citizens for Tax Justice calculations indicate that a Buffett rule at 30 percent would now raise about $50 billion a year in new revenue.

Would a 30 percent Buffett rule, in and of itself, make the tax code fair? Not by the Debbie Bosanek yardstick. If her boss Warren Buffett had to pay 30 percent of his income in federal income tax, Debbie Bosanek would still be paying total federal taxes at a higher rate than her boss.

The White House seems to understand this reality and, to its credit, is asking for more tax changes than a new 30 percent Buffett rule. For starters, the Obama administration wants to let the 2001 and 2003 Bush tax cuts expire for taxpayers making over $250,000 a year.

That move would raise the top tax rate on capital gains income — the category that includes most of the income that Warren Buffett and Mitt Romney collect every year — from 15 to 20 percent and the tax rate on dividends from 15 to 39.6 percent, the same top tax rate the expiration of the Bush tax cuts would fix on ordinary income from wages and salaries.

The Obama administration also wants to reduce the tax deductions and credits high-income taxpayers can claim.

All these changes would certainly make for a more progressive tax code. But these changes, taken all together, would still leave today’s rich and super rich paying taxes at substantially lower overall rates than America’s rich and super rich used to pay decades ago.

A half-century ago, in 1962, Americans making over what today would be $1 million, after taking inflation into account, paid 42.8 percent of their total incomes in federal income tax. Ten years earlier, they paid even more. In 1952, millionaires — in today’s dollars — paid federal income tax at a 55.2 percent rate, show IRS historical data.

And those rich in 1952 were actually getting a good deal, compared to their counterparts ten years earlier. In 1942, the first full year of World War II, taxpayers who would be millionaires in today’s dollars paid their federal income taxes at an overall effective rate that hit 68.9 percent.

Just a reminder: We won that World War II, and the economic boom during the war years would raise millions of Americans into the middle class.

These days, billionaire Warren Buffett notes in another reminder, we’re fighting another war. A class war. In this class war, Buffett adds, his side has awesomely more weaponry than his secretary’s side.

“We have K Street,” Buffett explained last week. “We have Wall Street. Debbie doesn’t have anybody. I want a government that is responsive to the people who got the short straw in life.”

So should we all.

MORNING MESSAGE: Why Aren’t Mitt & Newt Talking Social Security in FL?

OurFuture.org’s Richard Eskow: ”I can certainly understand why the candidates didn’t want the subject raised. More than three and a half million Republican voters rely on Social Security, including seniors, disabled people, and surviving spouses. In fact, the candidates in Tuesday’s primary would be crazy not to hide their opinions on the topic … This week’s Florida primary should be renamed ‘Don’t Tell Grandma Social Security Will Be Dead – and Medicare Too – If We’re Elected.’ Mitt Romney’s already on record as saying income inequality shouldn’t be discussed openly. Was there some sort of ‘gentleman’s agreement’ to ignore Social Security too?”

Europe Admits: Austerity’s a Bust

EU to admit austerity isn’t working. NYT: ”…European leaders are expected to conclude this week that what the debt-laden, sclerotic countries of the Continent need is a dose of economic growth … The difficulty, however, is that reaching such a conclusion is not the same as making it happen. Instead, leaders will discuss long-term structural reforms and better use of E.U. subsidies, while avoiding mention of the one thing that could change the climate: a fiscal stimulus from Germany, the euro currency zone’s undisputed powerhouse.”

Several European nations are worse off than during the Depression because of austerity, argues NYT’s Paul Krugman: ”Britain, in particular, was supposed to be a showcase for ‘expansionary austerity,’ the notion that instead of increasing government spending to fight recessions, you should slash spending instead — and that this would lead to faster economic growth … ‘I firmly believe,’ declared Jean-Claude Trichet — at the time the president of the European Central Bank … ‘…confidence-inspiring policies will foster and not hamper economic recovery, because confidence is the key factor today.’ Such invocations of the confidence fairy were never plausible … Yet influential people on both sides of the Atlantic heaped praise on the prophets of austerity, Mr. Cameron in particular, because the doctrine of expansionary austerity dovetailed with their ideological agendas.”

No Settlement Yet

CA AG Kamala Harris holding out on foreclosure fraud settlement. Bloomberg:“…she is pushing a broader probe of banks’ mortgage practices, including securitization of the loans … After Harris rejected a proposed agreement in September, negotiators crafted two deals: one including California for $25 billion and another without the state for $19 billion … they must decide soon whether to move ahead without her …”

NY AG Eric Schneiderman, Obama’s new housing crisis investigator, hasn’t signed off either. HuffPost’s Robert Kuttner: ”…he has already gotten major concessions. The deal will only address the relatively narrow (but outrageous) abuse of robo-signing, and nothing in it will provide release from criminal prosecutions. Other details are still being negotiated. It is likely that Schneiderman will not give his final assent until he receives assurances on who will really be in charge of these broader investigations and with what level of resources … Schneiderman’s goal, as far as I can tell, is to serve both justice and macroeconomic recovery. With fresh federal investigative resources, he can threaten bankers with legal Armageddon. Then, in addition to sending the worst malefactors to prison, he can entertain a settlement not in the tens of billions but in the hundreds of billions — sufficient to provide very major write-downs of mortgage principal owed. That, in turn, changes the dynamics of the housing crisis as a drag on the recovery…”

Freddie Mac investments bet against homeowners, finds ProPublica and NPR:“Freddie Mac … has placed multibillion-dollar bets that pay off if homeowners stay trapped in expensive mortgages with interest rates well above current rates. Freddie began increasing these bets dramatically in late 2010, the same time that the company was making it harder for homeowners to get out of such high-interest mortgages. No evidence has emerged that these decisions were coordinated. The company is a key gatekeeper for home loans but says its traders are ‘walled off’ from the officials who have restricted homeowners from taking advantage of historically low interest rates by imposing higher fees and new rules.”

Banks lobby for overseas exemption of Dodd-Frank rules. Bloomberg: ”More than half of the derivatives- trading business of Goldman Sachs Group Inc, Morgan Stanley and three other large banks could fall largely outside the Dodd-Frank Act if they succeed in lobbying regulators to exempt their overseas operations … If overseas operations aren’t subject to U.S. rules or equivalent regulation by other nations, it could impede the goal of preventing another credit crisis, Darrell Duffie, professor at Stanford University’s Graduate School of Business … CFTC Chairman Gary Gensler said this month that his agency won’t complete guidelines on the reach of Dodd-Frank until after April, while the financial industry waits for a similar proposal from the Securities and Exchange Commission. Gensler has said the CFTC may eventually defer to foreign regulators when they have comparable and consistent regulations.”

Businessman Presidents Are Failures

How successful are presidents with mainly private-sector experience? Not every, finds LAT’s Walter Zelman: ”…five presidents [since 1901 had] extensive private-sector experience … Warren Harding was a newspaper publisher. Herbert Hoover was an engineer who managed mining operations. Jimmy Carter was a peanut farmer. Both Bushes had longtime experience in the oil business, and George W. Bush was a managing partner of a baseball team. None of these five presidents rank above average, and three — George W. Bush, Harding and Hoover — are near the bottom of most rankings.”

Romney profited from Bain’s lobbying, reports Mother Jones: ”The firm spent $300,000 between August of 2007 and April of 2008 lobbying the House and Senate on bills that threatened the carried interest loophole … Bain and its ilk paid lobbying shops, public relations firms, and trade groups like Ogilvy and the Private Equity Growth Capital Council an estimated $15 million … Bain’s gain, then, has clearly been Romney’s as well—and the candidate has publicly endorsed the same policies the company has backed.”

GOP is risking obsolescence, argues NYT’s Tom Edsall: ”The party could open up beyond its core believers to accommodate old-school Republican moderates and hold on to its libertarians and still have decent size, strength and power. But the country is going through a profound restructuring in moral and economic thinking and the danger for Republicans is that their current coalition might become obsolete. If the party doesn’t adapt, the alternative is that its power centers — the Christian right, anti-immigration forces, and proponents of policies that benefit the affluent at the expense of the less well-off — will refuse to adjust, in which case the party risks going the way of the Studebaker.”

Breakfast Sides

“Bolder choices” needed on military cuts, argues FT’s Edward Luce: ”Why are there still 30,000 troops in Germany? Why does the US need almost 2,000 nuclear warheads? Under what scenarios does it imagine fighting major land wars?”

Sen. Min. Leader McConnell refuses to rule out tax increase to offset cost of payroll tax cut extension reports Politico.

CA Gov. Jerry makes case that high-speed rail is cheaper with cap-and-trade. McClatchy quotes: ”…cap-and-trade, which is this measure where you make people who produce greenhouse gases pay certain fees – that will be a source of funding going forward for the high-speed rail.”

The Austerity Debacle (NYT)
Paul Krugman argues that the case against austerity is pretty open and shut given that we’ve had 80 years to learn from the Great Depression and today’s European policymakers have still managed to find a way to make things worse this time.

Growth Accelerates, but U.S. Has Lots of Ground to Make Up (NYT)
Catherine Rampell reports that despite 2.8% growth last quarter, the economy is still looking as sluggish as an old man after a turkey dinner thanks to rapid cuts in government spending and continued weakness in consumer demand and hiring.

Eric Schneiderman: Hero or Goat? (HuffPo)
Robert Kuttner writes that while many progressives fear Eric Schneiderman will be used like a nice throw pillow on the very ugly sofa of the foreclosure settlement, this deal could give him the resources he needs and a lot more leverage than they think.

Lanny Breuer, Task Force Leader, Doesn’t Bother Showing Up For Mortgage Fraud Press Conference (Naked Capitalism)
Roosevelt Institute Fellow Matt Stoller argues the task force’s relative lack of manpower shows the administration is taking this about as seriously as if it declared war and sent in a few dozen ground troops who were told to imitate jet noises.

Household Formation: Divorces, Births Correlated with Unemployment Across States (Rortybomb)
Roosevelt Institute Fellow Mike Konczal notes that financial pressures are keeping marriages together but also keeping babies from being made, meaning that as things pick up, there could be a lot of “It’s not you; it’s the recovery” speeches coming.

Click here for details on Senior Fellow Richard Kirsch’s new book on the epic health care reform battle, Fighting for Our Health, on sale February 1.

Average Americans don’t think like economists (WaPo)
One might be tempted to offer a silent prayer of thanks for a headline like that, but Suzy Khimm highlights a new study that shows that aside from their different political opinions, economists and the general public don’t always share the same facts.

This Week in Poverty: State of the Union, State of Florida (The Nation)
Greg Kaufmann writes that while the president spent plenty of time in last week’s address discussing the rich and middle class, he only touched on the 46 million below the poverty line long enough to note that somewhere, a poor child might exist.

What Debt Did for Romney (New Yorker)
James Surowiecki points out that if Republicans were serious about reducing private debt instead of just using it as a rhetorical bludgeon against Obama, they could limit tax deductions that encourage corporations to gorge on credit until they choke.

Higher Taxes Help the Richest, Too (NYT)
Robert Frank explains that raising taxes on the rich won’t really make it any harder for them to buy that second Bugatti they’ve been wanting, but it will help to ensure that there are nice, paved roads for their chauffeurs to drive them around on.

For your own sake, stop working so hard (WaPo)
Richard Schiffman argues that shortening the work week for the most productive, over-stressed generation in U.S. history would have significant economic benefits and give employees a chance to experience novelties like sleep and relaxation.

- The Washington Post reports that Ron Paul signed off on the racist and homophobic newsletters that bear his name.

- Maryland Gov. Martin O’Malley spoke at Creating Change yesterday, reiterating his support for marriage equality and gender identity nondiscrimination protections. Meanwhile, Maryland First Lady Katie O’Malley has apologized for calling the legislators who turned against marriage equality last year “cowards.”

- In its new magazine issue, OutServe takes on “The New DADT: Transgender Service.”

- Rep. Michele Bachmann (R-MN) and other conservative leaders met on Friday to develop strategies for supporting the anti-same-sex marriage amendment.

- North Carolinians are taking to college campuses to fight the proposed discrimination amendment there, including in drag.

- The Illinois Human Rights Commission is allowing a suit to proceed against a bed & breakfast that refused to host a civil union ceremony.

- Did Iowa Gov. Terry Branstad (R) try to take his title off a conference supporting LGBTQ youth?

- Dallas Mayor Mike Rawlings is reconsidering joining the group of mayors supporting marriage equality after meeting with LGBT leaders.

- Idaho activists are now campaigning to “Add the Words” sexual orientation and gender identity to the state’s non-discrimination protections.

- A report released last week highlights the importance of LGBT equality for the financial security of same-sex families.

- A new study suggests that education and critical thinking could be the key to reducing prejudice in society.

- In the Church of England, the Archbishop of York thinks Prime Minister David Cameron is a “dictator” for supporting marriage equality, while a former Archbishop of Canterbury now supports an ex-gay therapist.

- Over 180 members of the European Parliament, including its president, have signed a pledge to support gay rights.

- A gay Russian flight attendant trying to create an LGBT employee support group was forced to marry his former high school girlfriend.

Wind power developers installed wind turbines with capacity of 6,810 MW in the US last year, which is an increase of 31 percent according to the American Wind Energy Association. [EV Wind]

Global renewable energy deals climbed 40 percent to a record high of $53.5 billion last year from $38.2 billion in 2010, as solar, wind and energy efficiency overtook hydropower as the main deal drivers for the first time, a report said on Monday. [Reuters]

Universal Solar System, a developer of clean-energy projects in India, completed its first 2-megawatt plant in Gujarat state. [Bloomberg]

Speaker John Boehner (R-OH) said Sunday that legislation advancing the Keystone XL pipelinewould be part of a major House Republican infrastructure and energy bill if it is not enacted before that bill comes to a vote. [The Hill]

The safety and environmental concerns related to shale gas extraction aren’t limited to fracking, and that the “cleanness” of this clean-energy solution isn’t entirely clear. [Mother Jones]

Gov. Jerry Brown said in an interview airing in Los Angeles today that California’s high-speed rail project will cost far less than the state’s current estimate of nearly $100 billion and that environmental fees paid by carbon polluters will be a source of funding. [Sacramento Bee]

Tornadoes assaulted 23 regencies and cities throughout Indonesia on Wednesday, claiming seven lives, injuring 51 people and damaging 1,012 houses. [Xinhua]

The New South Wales Government has declared five natural disaster zones in the Australian state’s north after days of severe flooding. [Herald Sun]

Yet no responsible Democrat should be pleased at the prospect that Gingrich could get the GOP nomination. The future of America is too important to accept even a small risk of a Gingrich presidency.

The Republican worry is understandable. “The possibility of Newt Gingrich being our nominee against Barack Obama I think is essentially handling the election over to Obama,” says former Minnesota Governor Tom Pawlenty, a leading GOP conservative. “I think that’s shared by a lot of folks in the Republican party.”

Pawlenty’s views are indeed widely shared in Republican circles. “He’s not a conservative – he’s an opportunist,” says pundit Joe Scarborough, a member of the Republican Class of 1994 who came to Washington under Gingrich’s banner. Gingrich doesn’t “have the temperament, intellectual discipline or ego control to be either a successful nominee or president,” says New York Republican representative Peter King, who hasn’t endorsed any candidate. “Basically, Newt can’t control himself.”

Gingrich is “an embarrassment to the party,” says New Jersey Republican Governor Chris Christie, and “was run out of the speakership” on ethics violations. Republican strategist Mike Murphy says “Newt Gingrich could not carry a swing state in the general election if it was made of feathers.”

“Weird” is the word I hear most from Republicans who have worked with him. Scott Klug, a former Republican House member from Wisconsin, who hasn’t endorsed anyone yet, says “Newt has ten ideas a day – two of them are good, six are weird and two are very weird.”

Newt’s latest idea, for example – to colonize the moon – is typically whacky.

The Republican establishment also points to polls showing Gingrich’s supporters to be enthusiastic but his detractors even more fired up. In the latest ABC News/Washington Post poll, 29 percent view Gingrich favorably while 51 percent have an unfavorable view of him. Obama, by contrast, draws a 53 percent favorable and 43 percent unfavorable.

Independents, who will be key to the general election, are especially alarmed by Gingrich.

As they should be. It’s not just Newt’s weirdness. It’s also the stunning hypocrisy. His personal life makes a mockery of his moralistic bromides. He condemns Washington insiders but had a forty-year Washington career that ended with ethic violations. He fulminates against finance yet drew fat checks from Freddie Mac. He poses as a populist but has had a $500,000 revolving charge at Tiffany’s.

And it’s the flagrant irresponsibility of many of his propositions – for example, that presidents are not bound by Supreme Court rulings, that the liberal Ninth Circuit court of appeals should be abolished, that capital gains should not be taxed, that the First Amendment guarantees freedom “of” religion but not “from” religion.

It’s also Gingrich’s eagerness to channel the public’s frustrations into resentments against immigrants, blacks, the poor, Muslims, “liberal elites,” the mainstream media and any other group that’s an easy target of white middle-class and working-class anger.

These are all the hallmarks of a demagogue.

Yet Democratic pundits, political advisers, officials and former officials are salivating over the possibility of a Gingrich candidacy. They agree with key Republicans that Newt would dramatically increase the odds of Obama’s reelection and would also improve the chances of Democrats taking control over the House and retaining control over the Senate.

I warn you. It’s not worth the risk.

Even if the odds that Gingrich as GOP presidential candidate would win the general election are 10 percent, that’s too much of a risk to the nation. No responsible American should accept a 10 percent risk of a President Gingrich.

I’d take a 49 percent odds of a Mitt Romney win – who in my view would make a terrible president – over a 10 percent possibility that Newt Gingrich would become the next president – who would be an unmitigated disaster for America and the world.

This post appears courtesy of Robert Reich.