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  • Obama's elite fundraisers receive plenty of perks

    President Barack Obama’s administration is rewarding elite campaign donors in the same ways that its predecessors did, helping them win influence and access to power in Washington, according to a Center for Public Integrity investigation published Thursday. 

    The investigation of so-called “bundlers” – fundraisers who solicit contributions of up to $2,500 and combine them in campaign donations that range from $50,000 to $500,000 – found that many have been appointed to advisory panels and commissions that can help set government policy. They also have been invited to exclusive White House briefings, holiday parties and social events, the investigation found. 

    And some have landed government contracts that appear to have aided their business interests or investment portfolios.  

    Among the highlights of the CPI investigation: 

    • At least 68 of 350 Obama bundlers for the 2012 election or their spouses have served in the administration.
    • At least 250 of the bundlers have been cleared to attend a White House event since January 2009.
    • At least 30 of the 2012 bundlers have ties to companies that conduct business with federal agencies or hope to do so. 

    Click here to read the full CPI report.

  • More scrutiny for Romney: Overseeing Marriott during years of kickback charges

    Jonathan Ernst / Getty Images

    From governor's son to presidential contender, a look at the life of Republican Mitt Romney.

    Mitt Romney's service on the board of Marriott International has come under scrutiny in a story published Thursday by 100Reporters, a new investigative reporting group.

    Business reporter Lucy Komisar reports:

    Mitt Romney, who makes his hands-on business experience a talking point in his campaign for the Republican presidential nomination, was a member of the board of directors and audit committee of a global company when it paid millions of dollars to settle charges of extracting kickbacks that cheated clients.

    As a board member, Romney held oversight responsibilities at a time when Marriott was repeatedly accused of obtaining secret rebates that enriched Marriott, at the expense of hotel owners who had contracted with Marriott to run the hotels on their behalf. A series of owners also accused Marriott of falsifying financial statements to owners to conceal the arrangements—charges that Marriott had denied.


    Should a director bear responsibility for actions by a company's management?

    Here's how Komisar deals with that question, along with background on ties between Romney and the Marriott family:

    To be sure, Romney’s was only one voice of ten on the board. What he may have said privately at board meetings or to Marriott executives about the secret rebates and the risk to shareholders and the company is not known. What is known is that during his tenure the company continued a practice that had come under severe reprimand by the courts, and there is no record that Romney ever denounced or criticized the practice.

    In addition, the company failed to disclose the mounting disputes to the Securities and Exchange Commission despite the risk they represented to the company’s stock price, and did so only after they culminated in public lawsuits.

    With law and business degrees from Harvard University, Romney was well-schooled in understanding the legal and business risks to the company from theses charges. Romney was one of the designated “independent,” members of the Marriott board, which meant that neither he nor his family were to have financial ties to the company. Indeed, no Romney had been an employee of Marriott or the company’s auditor.

    On personal and political levels, however, bonds between the Romney and Marriott families run deep. The company founder J. Willard Marriott was close to Romney's father George. Both families are important in the Mormon Church. Romney was named Willard (the W. in his name), in Marriott's honor.

    In 1994 the Marriott family gave hundreds of thousands of dollars to Romney's campaign for the U.S. Senate. In 2008, CEO J. Willard "Bill" Marriott, the founder's son, was national finance co-chair of Romney’s campaign for the Republican presidential nomination. Bill Marriott has so far donated $500,000 to Romney’s current campaign through the pro-Romney "super PAC," Restore Our Future, while his brother, Richard Marriott, has given the same.

    The Romney campaign did not respond to questions about his service at Marriott.

    The reporter, Lucy Komisar, is an experienced investigative journalist focusing on corporate corruption.

    Read her full story at 100r.org.

  • NBC poll: Newt Gingrich gains ground on Mitt Romney in South Carolina

    In the final days leading up to the South Carolina primary, Newt Gingrich attacked Mitt Romney's tax rate revelation. NBC's Chuck Todd reports.

     

    With two days until South Carolina’s Republican presidential primary, former Massachusetts Gov. Mitt Romney holds a 10-point lead over former House Speaker Newt Gingrich, according to a new NBC News/Marist poll of the GOP contest in that state.

    But a day after Monday night’s Republican debate – where Gingrich’s performance was considered strong and Romney’s uneven – the poll also shows the former speaker gaining considerable ground on the GOP frontrunner.


    Overall in the two-day survey – conducted Monday and Tuesday – Romney gets the support of 34 percent of likely Republican primary voters in South Carolina, including those who are undecided but leaning toward a candidate.

    He’s followed by Gingrich at 24 percent, Texas Rep. Ron Paul at 16 percent, former Pennsylvania Sen. Rick Santorum at 14 percent, and Texas Gov. Rick Perry at 4 percent.

    Iowa Republicans to call caucus result split decision

    Yet the numbers are strikingly different before and after the debate on Monday, when Romney stumbled over whether he would release his tax records (he later said he would do so in April). Also in that outing, Gingrich drew cheers – and even a standing ovation from some – in response to a question about whether his rhetoric about food stamps and janitorial work for poor children was racially insensitive.

    “The fact is that more people have been put on food stamps by Barack Obama than any president in American history,” Gingrich answered. “I know among the politically correct, you're not supposed to use facts that are uncomfortable.”

    Joe Raedle / Getty Images

    Former Massachusetts Gov. Mitt Romney visits Hudson's Smokehouse in Lexington, S.C., on Wednesday.

    He later added, “I believe every American of every background has been endowed by their creator with the right to pursue happiness. And if that makes liberals unhappy, I'm going to continue to find ways to help poor people learn how to get a job, learn how to get a better job and learn some day to own the job.”

    Another GOP debate takes place on Thursday evening.

    What a difference one debate makes
    On Monday before the debate, Romney led Gingrich in the poll by 15 points, 37 percent to 22 percent. But on Tuesday, that advantage narrowed to just five points, 31 percent to 26 percent.

    “The numbers on Tuesday were very different than the numbers on Monday,” says Lee Miringoff, director of the Marist College Institute for Public Opinion, which conducted the survey.

    And they were especially different among the most conservative segments of the GOP electorate in South Carolina.

    On Monday, Gingrich held a five-point lead over Romney among those describing themselves as “very conservative,” 32 percent to 27 percent, with Santorum getting 24 percent.

    While on the trail in South Carolina, Mitt Romney said he will release further details about his taxes in April if he secures the Republican presidential nomination. NBC's Peter Alexander reports.

    But the next day, Gingrich’s percentage with this group jumped up to 35 percent, Santorum’s declined to 20 percent and Romney’s sunk to 19 percent.

    Among Tea Party supporters on Monday, Romney edged Gingrich, 35 percent to 27 percent. But on Tuesday, the numbers flipped – with Gingrich at 34 percent and Romney at 27 percent.

    And a similar change occurred among likely South Carolina primary voters who are evangelical Christians. On Monday, Romney led Gingrich here, 36 percent to 22 percent, with Santorum at 18 percent. On Tuesday, it was Gingrich at 27 percent, Romney at 22 percent, and Santorum at 19 percent.

    While Gingrich gained ground on Romney the day after the GOP debate, his poll position in South Carolina has declined markedly since December, when he led the former Massachusetts governor in the NBC News/Marist poll, 42 percent to 23 percent.

    The Bain dog doesn’t bite – at least for now
    Romney also can take comfort with this finding from the poll: His past work at Bain Capital doesn’t seem to bother South Carolina Republicans.

    Sixty-one percent of GOP primary voters – as well as 42 percent of all registered voters in the Palmetto State – agree with the statement that investment firms like Bain help the U.S. economy. And they agree that while some companies fail or are restructured, others succeed and that’s how the free market works.

    By comparison, just a quarter of likely GOP primary voters – plus a third of all registered voters – agree with the statement that investment firms like Bain hurt the U.S. economy when they take over a company; when they lay off workers and reduce their pay; and when they make money for the firm whether or not the company succeeds.

    What’s more, 48 percent of likely Republican primary voters believe the recent political attacks on Romney’s past experience at Bain are unfair, while just 22 percent think they’re fair.

    And a plurality of likely GOP primary voters – 23 percent – find Romney to be the Republican presidential candidate who best understands their problems. That’s compared with 22 percent for Gingrich, 18 percent for Paul and 16 percent for Santorum.

    Other notable numbers in the poll:

    •       39 percent of likely Republican voters in the state believe that the ability to beat President Barack Obama in November is the most important candidate quality, and that’s nearly double the percentage who said that in December’s NBC News/Marist poll of South Carolina;

    •       a majority (56 percent) think Romney has the best chance of beating Obama;

    •       a plurality (30 percent) say that Romney has been the candidate who has spent the most time talking about the issues, while another plurality (41 percent) say Gingrich has been the one who has spent the most time attacking his opponents;

    •       another plurality (36 percent) say they like Paul the least;

    •       and Obama’s job-approval rating in South Carolina – among registered voters – is 44 percent.

    The NBC News/Marist poll was conducted from Jan. 16-17 among 684 likely GOP primary voters (with a margin of error of plus-minus 3.8 percentage points). The pre-debate sample surveyed 349 likely voters (+/- 5.5), and the post-debate sample had 335 (+/- 5.5.).

    Among the 2,146 registered voters, the margin of error is plus-minus 2.1 percentage points.

  • Railroad companies fight safety rules, with help from GOP and Obama

    Kelly B. Huston

    The Chatsworth rail disaster in 2008 caused 25 deaths and 135 injuries in Chatsworth, Calif., on Sept. 12, 2008.

    By Justine Sharrock, Laurie Udesky and Stuart Silverstein
    FairWarning.org

    Less than four years after a California train disaster spurred passage of major safety legislation, railroad companies are pushing hard to relax the law’s chief provision.

    They have won over key Republicans, and extracted a major concession from the Obama administration, in their bid to scale back and delay a system to prevent crashes such as the head-on collision that caused 25 deaths and 135 injuries in Chatsworth, Calif.

    The Rail Safety Improvement Act, passed in late 2008 soon after the Chatsworth disaster, mandated the $13 billion project and stuck railroad companies with nearly all of the cost. The law calls for installation of a technology known as Positive Train Control, or PTC, that automatically puts the brakes on trains about to collide or derail.


    Railroads are required to install PTC by the end of 2015 on an estimated 70,000 miles of track used by trains carrying passengers or extremely hazardous materials such as chlorine.

    The technology’s champions include the National Transportation Safety Board, an independent advisory and investigative agency. It has advocated PTC for more than two decades to prevent accidents resulting from human error, the main cause of rail crashes.

    Investigators with the agency have identified 21 train wrecks since late 2001 that, they say, would have been averted by PTC. In all, the accidents caused 53 deaths and nearly 1,000 injuries.

     “PTC can prevent these human errors from causing collisions, hazmat releases, passengers killed and injured, and train crews being killed,” said Steven Ditmeyer, a former rail industry executive and federal official who now teaches in Michigan State University’s railway management program.

    Serious train crashes, he said, “are very rare events, but they still occur.”

    PTC supporters such as Paul Hedlund, a lawyer for many families of Chatsworth victims, say they are appalled by efforts to relax the mandate. It’s a “scary step backwards,” Hedlund said, calling existing protections “horribly archaic.”

    Since 2008, he added, “We haven’t had another crash of the magnitude of Chatsworth that would be affected by this but we are going to.”

    Centers for Disease Control and Prevention

    The 2005 rail crash in Graniteville, S.C., killed nine people and caused the evacuation of 5,400.

    But the railroad industry and its allies, arguing that the project is unaffordable, have put up stiff resistance. They also maintain that the technology still needs to be refined, even though Amtrak already operates a similar system from Boston to Washington, D.C.

    PTC critics have argued for delaying the installation deadline by three years, exempting as much as 20 percent of the track and allowing railroads to use other safety systems that might be cheaper, but also less effective.

    The industry is bolstered by a political climate that is hostile to federal dictates, a factor behind the executive order President Obama issued early last year to streamline regulations. They have extra leverage because federal agencies are divided on the merits of the PTC mandate.

    PTC opponents also are drawing ammunition from a 2010 report by the Government Accountability Office. The GAO assessment didn’t address PTC’s effectiveness but said technological hurdles could delay completion of the project beyond the 2015 deadline.

    “What you hear from all the railroad companies is that everyone supports PTC in theory, but the realities of how difficult it is financially and technologically to install [mean] it can’t happen by 2015,” said Matt Ginsberg, director of operations for the National Railroad Construction and Maintenance Association, which includes contractors that work on PTC installation.

    The industry’s strategy, he added, is that “instead of an outright repeal, they will slowly chip away at it, making small little tweaks that will make a big change overall in the effect of the rule.”

    Leading the resistance are the Association of American Railroads, which represents freight haulers and Amtrak, along with the American Public Transportation Association, which represents commuter rail systems. They have called PTC the biggest federal mandate the industry has faced in more than a century, and say they anticipated that the government would step up its financial support.

    To deliver their message on PTC and other issues, railroad interests spend heavily on lobbying. According to the watchdog group Citizens for Responsibility and Ethics in Washington, the railroad industry poured $73.4 million into lobbying in 2009 and 2010, and another $8.75 million in the first quarter of 2011.

    The industry also has retained dozens of lobbyists, including the firm of former Senate powerhouses John Breaux, D-La., and Trent Lott, R.-Miss.

    Meanwhile, as political currents have shifted and PTC has fallen out of the spotlight, the technology has fewer forceful advocates.

    Former U.S. Rep. James L. Oberstar, a Minnesota Democrat who led the push for PTC in the House and who argued for it since the 1990s, was voted out of office in 2010, when Republicans took control of the lower chamber.

    The Democrat who perhaps was most pivotal in getting the rail safety act through Congress and signed into law was Sen. Dianne Feinstein of California. Days after the Chatsworth crash in September 2008, she said the failure to install PTC would amount to “criminal negligence.”

    Today, she still favors PTC but no longer is a leader on the issue and is not a member of the panel with jurisdiction over railroads, the Commerce Committee.  Feinstein’s office quoted the senator as saying that she has urged colleagues to maintain the current deadline.

    PTC systems include GPS and wireless communications technology and central control centers. They can monitor trains and stop them if they enter the wrong track or are about to run a red light.

    According to the National Transportation Safety Board, one of the accidents that PTC would have prevented was the freight train-commuter train collision in Chatsworth. The NTSB investigation blamed the accident on an engineer on the commuter train who ran a red light while text-messaging on a cellphone. (Metrolink, the rail system that operates the Chatsworth commuter line, hopes to finish installing its PTC system by mid-2013.)

    The NTSB said the January 2005 rail crash in Graniteville, S.C., that killed nine people and injured 554 also would have been prevented by PTC. The crash punctured a chlorine tank car, releasing a toxic, greenish cloud that led to the evacuation of about 5,400 residents.

    However, the agency responsible for enforcing the deadline has expressed ambivalence about PTC. The Transportation Department’s Federal Railroad Administration concedes that PTC increases safety. But the agency says PTC would save only about four or five lives a year, not nearly enough to justify the  cost – though the agency analysis was completed in 2005, before the Chatsworth disaster.

    PTC advocates say the agency’s analysis ignores the enormous business benefits that the technology could provide by, not only preventing accidents, but also by coordinating train traffic more efficiently and cutting shipping times.

    Still, after the Transportation Department spelled out its rules for enforcing the PTC law, it was sued in November 2010 by the Association of American Railroads. The industry group accused the agency of issuing “a regulation that imposes a staggering and unjustified burden” that went beyond the intent of Congress.

    Among other grievances, the industry said federal officials wrongly required railroads to put PTC on track that by 2015 will no longer be used to haul chlorine or other extremely hazardous materials.

    The Transportation Department, to settle the litigation, offered to reduce the amount of track required to have PTC. The proposal, expected to be adopted in some form this spring, would remove 7,000 to 14,000 miles of track from the mandate, a cut of about 10 percent to 20 percent.

    In an Aug. 23 announcement, Transportation Secretary Ray LaHood characterized the move as being in line with the Obama administration’s initiative to streamline regulation.

    NTSB officials, however, say the proposal also could have a pernicious effect. They say it could crimp regulators’ flexibility to require PTC on troublesome track not specifically designated by the statute.

    For instance, regulators can insist on PTC when they are concerned about the safety of track where freight trains haul, say, ethanol – a dangerous material, but not one of the extreme hazards specified in the law. But the head of the NTSB, Deborah Hersman, said her agency is concerned that the “ability to identify other high-risk corridors will be hampered” because, under the proposed change, the railroads no longer would have to provide the government with as much risk data.

    Separately, House Republicans have advocated relaxing the PTC requirements. One of the leaders is U.S. Rep. John Mica of Florida, chairman of the House Transportation Committee.

    According to Citizens for Responsibility and Ethics in Washington, Mica is one of the biggest recipients of railroad industry campaign contributions, with $182,298 since 2008.

    He is working on a long-term surface transportation authorization bill that is regarded as a likely legislative vehicle for key breaks sought by the railroads. Lawmakers are expected to resume working in earnest on the authorization bill by the beginning of February.

    Mica has voiced support for extending the PTC deadline by three years and allowing trains to use so-called non-technological safety systems. 

    Such systems, unlike PTC, can’t automatically counter human error, which the Transportation Department says causes 40 percent of train accidents. Mica has described his goal as to “protect against overly-burdensome regulations and red tape.”  

    Another vocal critic of PTC is U.S. Rep. Bill Shuster, R-Pa., chairman of the railroads subcommittee.

    According to The Center for Responsive Politics, railroads were the top-contributing industry to his 2008 and 2010 election campaigns. Shuster has received $165,800 in campaign contributions from railroad interests since 2008.

    He has criticized the PTC mandate ever since it was adopted. At a March hearing,  Shuster advocated extending the deadline beyond 2015 and reducing the amount of track covered, while calling the existing requirements “regulatory overreach.”

    Talk of accommodating the industry, however, infuriates union leaders. “It’s hard for me to believe that anyone can go to Congress and say with a straight face that seven years after the bill passed is ‘not enough time for us to do this,’’’ said James Stem, legislative director of the United Transportation Union.  “But that’s what’s going on.”

    Frank Kohler, severely injured in the Chatsworth train wreck.

    It’s also distressing to crash victims such as Frank Kohler.

    Kohler was one of those injured in the Chatsworth disaster.  He woke up after the collision lying on the ground with his head split open; he suffered a brain injury that, Kohler says, causes him to get confused and has ended his 36-year career as an emergency responder and registered nurse.

    If PTC has been in place three years ago, Kohler said, he would have arrived home safely. Kohler added, “I would still have my professional life intact and I would be a productive member of society.”  

    FairWarning is a nonprofit, online investigative news organization focused on public health and safety issues.

  • Gingrich ex-wife claims he sought 'open' relationship, candidate won't say 'anything negative'

    Mark Wilson / AP

    In this Jan. 7, 1997 photo, House Speaker Newt Gingrich of Georgia and his wife Marianne leave their home for Capitol Hill.

    Updated Thursday at 1:15 p.m. ET

    In excerpts of an interview scheduled to air on Thursday night, Marianne Gingrich claims that her ex-husband, Newt Gingrich, sought an "open marriage" before their own relationship ended. 

    In the interview with ABC News, Marianne Gingrich claims that when the then-House speaker told her of a long-term, six-year affair he was having with a congressional staffer (Callista Bisek, now his third wife), he asked if he could remain married to Marianne and continue the affair. 

    "I just stared at him and he said, 'Callista doesn't care what I do,'" Marianne Gingrich told ABC News. "He wanted an open marriage and I refused."

    In an exclusive interview with ABC News, Newt Gingrich's ex-wife Marianne Gingrich  claimed the former speaker's asked her for an "open marriage" and to allow him to continue his affair with then-mistress Calista.

     

    Marianne Gingrich, the former speaker's second wife, also alleged that her ex-husband conducted his affair "in my bedroom in our apartment in Washington."

    She also said Gingrich moved to divorce her just months after she was diagnosed with multiple sclerosis.  "He also was advised by the doctor when I was sitting there that I was not to be under stress," she said. "He knew."

    According to Marianne Gingrich, her relationship with him began while Newt Gingrich was still married, but in divorce proceedings, with his first wife, Jackie. At the time, Jackie Gingrich was being treated for cancer.

    In a second interview with The Washington Post, Marianne Gingrich said her ex-husband asked for a divorce in May 1999, shortly before giving a speech on family values.

    She asked in that conversation with The Washington Post, "How could he ask me for a divorce on Monday and within 48 hours give a speech on family values and talk about how people treat people?"

    In an interview with NBC's TODAY on Thursday, before the ABC News excerpts were released, Newt Gingrich vowed that he won't say "anything negative" about his former wife.

    Former House Speaker Newt Gingrich talks to TODAY's Ann Curry about his presidential candidacy, defends his comments about the poor and says he's not going to criticize his ex-wife, who has promised to give an explosive interview to ABC News.

    According to The Washington Post, at a campaign stop in South Carolina on Thursday, he called the statements by Marianne Gingrich, "tawdry and inappropriate," but wouldn't go further. His third wife, Callista Gingrich, stood a few feet behind him.

    As word spread Wednesday about the interview with Marianne Gingrich, the campaign responded with something of a "prebuttal."

    In advance of that interview, the campaign released a statement Wednesday night from Gingrich's daughters from his first marriage, Kathy Lubbers and Jackie Cushman.

    They wrote:

    The failure of a marriage is a terrible and emotional experience for everyone involved.  Anyone who has had that experience understands it is a personal tragedy filled with regrets, and sometimes differing memories of events. 

    We will not say anything negative about our father’s ex-wife.  He has said before, privately and publicly, that he regrets any pain he may have caused in the past to people he loves.

    ABC News or other campaigns may want to talk about the past, just days before an important primary election.  But Newt is going to talk to the people of South Carolina about the future– about job creation, lower taxes, and about who can defeat Barack Obama by providing the sharpest contrast to his damaging, extreme liberalism.  We are confident this is the conversation the people of South Carolina are interested in having. 

    Our father is running for President because of his grandchildren – so they can inherit the America he loves.  To do that, President Obama must be defeated.  And as the only candidate in the race, including Obama, who has actually helped balance the national budget, create jobs, reform welfare, and cut taxes and spending, Newt felt compelled to run - to serve his country and safeguard his grandchildren's future.

     

  • Gingrich daughter's teen work may have violated law

    Phil Skinner / AP

    Jackie Gingrich Cushman, daughter of Newt Gingrich, speaks at a news conference at the Georgia state capitol last month. Gingrich said in a debate this week that his daughter worked as a church janitor when she was 13.

    During the Republican presidential debate this week, Newt Gingrich shared a story about how his daughter worked as a church janitor when she was only 13.

    “I was actually proud of my clean bathrooms,” Jackie Gingrich Cushman said in an telephone interview Tuesday, referring to the janitorial job she held at the First Baptist Church in Carrollton, Ga., in the early 1980s. “I learned work has value.”

    But that work may have been a violation of federal child labor laws that her father has denounced as “stupid.”

    Cushman was 13 when she took the part-time, minimum-wage janitorial job, scrubbing bathrooms two days a week using cleaning supplies and a bucket. She said working as a janitor was a "great experience."

    Asked if she was working legally as a janitor for the church, Cushman said, "I certainly hope so." 

    But based on child labor laws in effect now and in the 1980s, 13-year-olds are not allowed to hold janitorial jobs, said Michael Hancock, assistant administrator for policy in the wage and hour division of the U.S. Department of Labor. There are no exemptions for religious organizations and their employees when it comes to child labor laws, according to the agency.

    "I definitely see it as a child labor violation," said Reid Maki, coordinator of The Child Labor Coalition, when asked about a 13-year-old working as a janitor. "When you put a kid in a situation that’s designed for adults you're asking for trouble."

    Gingrich’s reference to his daughter’s youthful employment is part of an ongoing narrative for the former House speaker: Poor kids should start toiling as early as 9 years old so they can learn what it means to make a living. “I’m going to continue to find ways to help poor people learn how to get a job, learn how to get a better job and learn someday to own the job,” Gingrich said in the debate Monday.

    Research has shown that teens who have jobs early in life are more likely to build a strong work ethic. But handing over adult jobs to kids might not be the right way to do that, particularly because there are tasks younger kids are not allowed to perform under U.S. law, including janitorial services.

    Under the law 13-year-olds can:

    • Deliver newspapers.
    • Work as a baby sitter.
    • Work as an actor or performer in motion pictures, television, theater or radio.
    • Work in a business solely owned or operated by their parents.

    It's fine for 14- and 15-year-olds to work a janitorial job in many types of retail and service establishments. There are restrictions at these ages as well, however, under the Fair Labor Standards Act of 1938.

    “They can’t work as janitors in any manufacturing establishment or industries that are deemed too hazardous for the employment of such youth,” according to the Labor Department.

    A spokesman for Gingrich seemed unconcerned when informed that 13-year-olds are not allowed to work as janitors.

    "Can they work as a clerk in the library?" press secretary R.C. Hammond responded by email.

    Gingrich has proposed getting rid of age limits as a way to help build work values and save money because kids can do similar work for less pay than higher-paid adults.

    "It is tragic what we do in the poorest neighborhoods in trapping children … in child laws which are truly stupid," Gingrich said in November talk at Harvard's Kennedy School of Government, according to the Los Angeles Times. "OK, you say to someone, 'You shouldn't go to work before you're 14, 16 years of age.' Fine. You're totally poor. You're in a school that is failing with a teacher that is failing. I tried for years to have a very simple model. Most of these schools ought to get rid of the unionized janitors, have one master janitor and pay local students to take care of the school."

    Not everyone agrees.

    “Substitution of child labor for adult labor is never an economic bargain,” said Hugh Hindman, professor of labor at Appalachian State University, and author of “Child Labor: An American History.”

    “Not only are adults with full-time jobs earning living wages displaced by kids with part-time jobs earning minimum wages, but the competition between children and adults will also depress the wages of those adults who hold on to their jobs,” Hindman said.

    Gingrich makes some important points about poor children, however, he said.

    “Opportunities for the kind of freelance jobs that teach responsibility and provide pocket money, baby-sitting, mowing lawns, shoveling snow, etc., are disproportionately skewed toward middle- and upper-middle-class kids,” he said. “Poor kids do need this kind of opportunity, but I'm not sure janitorial service is the ticket.”

    Jeylan Mortimer, a sociology professor at the University of Minnesota who has researched the impact of work on teens and found it helps them build confidence and interpersonal skills, supports any attempts to help adolescents get jobs.

    “The employment market for high school students has collapsed, largely as a result of competition with adults for teen jobs, and teen employment is now at its lowest level since the Bureau of Labor Statistics began compiling the data,” said Mortimer, author of “Working and Growing Up In America.” 

    The December unemployment rate for 16- to 19-year-olds was 20.3 percent, well above the 8.3 percent overall jobless rate. For blacks in that age group it's 42 percent.

    Mortimer isn't big on proposals she’s hearing from the stump to fix the problem.

    In addition to displacing adult workers, it would “likely expose teens to difficult, and possibly hazardous, work conditions, lots of bending and lifting, exposure to harsh cleaning agents, etc.," she said.

    She suggests creating a program where students can assist teachers or tutor at schools depending on their achievement level, and that wouldn't displace adult workers but would relieve "overworked educators."

    As for Gingrich's daughter, she sees value in all types of jobs when it comes to helping kids learn about work, but she maintained that unskilled labor may do the most character building.

    “Cleaning bathrooms taught me a lot,” Cushman said, adding that she worked many menial jobs, including being a rollerblading waitress for the Sonic Drive-In chain in high school. Such experiences, she added, helped her value hard work and “appreciate and value the people that do the work as well.

  • Romney’s estimated 15 percent tax rate rekindles fairness argument

    Charles Dharapak / AP

    Republican presidential candidate, former Massachusetts Gov. Mitt Romney campaigns at Andrews Field House at Wofford College in Spartanburg, S.C., Wednesday, Jan. 18, 2012.

    Mitt Romney’s estimate that he pays a 15 percent effective tax rate has suddenly become the dominant theme in the Republican campaign. While Romney has rekindled the long-running argument over tax fairness and whether investment income ought to be taxed at a lower rate than salary and wage income, it isn’t surprising that his effective tax rate is what it is – since much of his income is from investments and the tax code has long provided a preferential lower rate for them.

    Romney’s focus on his taxes has also revived a debate which Congress had in 2007 over whether the specific type of income he gets from his years at Bain Capital -- a kind of investment income called “carried interest” -- ought to be taxed at the lower capital gains rate of 15 percent, or the higher tax rate on earned income, which for the highest income taxpayers is 35 percent.

    If Romney, or anyone else, made $500,000  a year from a salary, he’d be taxed at a top marginal rate of 35 percent (scheduled to go up to 39.6 percent next year), but if he made that money in the form of capital gains and dividends he’d be taxed at 15 percent.

    The case against taxing “carried interest” at the lower capital gains rate was made in a Senate Finance Committee hearing in 2007 by Joseph Bankman, a professor of law and business at Stanford Law School.

    “We ought to have the same rate of tax apply across different occupations or investments,” Bankman told the committee. “The relative profitability of different professions, or investments, ought to be dictated by the market, not the tax law.”

    Recommended: Gingrich says he paid 31 percent in taxes last year

    He contended that the tax code’s treatment of investment fund managers “distorts career choice” and “is also unfair: why should fund managers get a lower tax rate than executives or scientists?”

    But investment industry advocates pointed to the long-standing policy of Congress -- dating back to the 1920s and continuing under both Democratic and Republican Congresses and presidents -- of taxing the gains made from sale of stocks or other assets at a lower rate than wage and salary income as a way to spur investment, help launch new companies, and create private-sector jobs.

    Kate Mitchell, a venture capital investor from Foster City, Calif., told the committee that she and others who run investment funds invest both their wealth and time (“sweat equity”) finding businesses to start, run, or revive.

    She said it was both smart and fair policy to “reward investors of sweat equity with the same long-term capital gain tax benefits that investors of financial equity receive. Both will only succeed if the business builds in value -- so both are subject to the same entrepreneurial risk … .”

    In 2007, when the Democrats controlled the House, Rep. Sander Levin, D-Mich., proposed to treat “carried interest” as ordinary income and have it taxed at rates up to 35 percent. Levin’s proposal was passed by the House four times, but never acted on by the Senate. Levin said Wednesday he would reintroduce that bill.

    In 2010, Senate Finance Committee chairman Max Baucus, D-Mont., introduced a bill to tax carried interest as ordinary income, but it did not pass the upper chamber.

    There was a brief period after enactment of the 1986 Tax Reform Act when capital gains income and salary income for the highest income people were taxed at the same top income tax rate of 28 percent. But when Congress increased income tax rates in 1991, it kept the lower capital gains tax rate and then cut it to 20 percent in 1997 and to 15 percent in 2003.

    Although the details of Romney’s income and the taxes he pays won’t be clear until April when he has promised to release his tax return for 2011, Democrats argue that Romney’s tax rate is unfairly low, and that a person who earns perhaps millions of dollars from carried interest ought to pay at a higher effective rate than 15 percent.

    But if it is 15 percent, how does Romney’s tax rate compare with that of other Americans?

    Romney’s 15 percent effective income tax rate is lower than that of most wealthy people, but higher than the effective income tax rate that most taxpayers pay.

    According to the Internal Revenue Service, in 2009, the most recent year for which data is available, two-thirds of all income tax returns reported adjusted gross income of under $50,000. In other words, nearly 93 million of the 140 million income tax returns reported adjusted gross income of less than $50,000.

    That means those taxpayers paid at the 10 percent statutory income tax rate or the 15 percent tax rate, or owed no tax at all.

    For married couples filing jointly, if their taxable income is not over $17,000, the law says they must pay at a rate of 10 percent.

    If their taxable income is over $17,000, but not over $69,000, they must pay $1,700 in income tax, plus 15 percent of the amount of income over $17,000.

    First Thoughts: Newt-mentum returns?

    The 25 percent income tax rate does not apply until a married couple has taxable income over $69,000 -- and the vast majority of Americans don't.

    (The higher rates, 28 percent, 33 percent and 35 percent, apply at even higher income levels.) But the effective tax rate, which the Congressional Budget Office defines as “the share of their income that people pay in (federal) taxes,” is lower than the statutory rate because exemptions, credits and deductions reduce tax liability.

    The IRS Statistics of Income data for 2009 show that for all 140 million tax returns, income tax paid as a percentage of adjusted gross income, was 11.4 percent.

    About 3.9 million tax returns reported adjusted gross incomes of $200,000 or more. Those tax filers, on average, paid at an effective tax rate of 22 percent.

    Those with between $50,000 and $200,000 in adjusted gross income paid, on average, about 9 percent of their AGI in income taxes.

    The tax filers with under $50,000 in adjusted gross income paid at an average effective tax rate of about 3 percent.

    (This IRS data doesn’t include the state and local taxes that people pay.)

    A person such as Romney who gets his income mostly or entirely from capital gains, dividends or “carried interest” does not face what the carpenter or barista faces: the Social Security and Medicare payroll tax, which is normally 7.65 percent. But in 2009 more than 27 million tax filers got the Earned Income Tax Credit which offset the payroll tax burden and was worth nearly $60 billion to those taxpayers -- on average, nearly $2,200 per tax return.

    The IRS Statistics of Income data isn’t perfect because as the Congressional Budget Office noted in 2005, “people, particularly those at the bottom of the (income) distribution, move onto and off the tax rolls from year to year,” so that the data “poorly represent the entire population over time and cannot consistently provide information on low-income taxpayers.”

    But the IRS data does cover all 140 million income tax filers and does allow comparisons to be made between different groups. Exactly where Romney falls in the tax distribution will be interesting to see in April when he releases his tax return for 2011.

  • Obama rejects Keystone oil pipeline

    Joshua Roberts / Reuters file

    Demonstrators carry a giant mock pipeline while calling for the cancellation of the Keystone XL pipeline during a rally in Washington in this November 6, 2011 file photo. Protesters are unhappy about TransCanada Corp's plan to build the massive pipeline to transport crude from Alberta, Canada, to Texas.

     

    Updated at 5:45 p.m. ET

    President Barack Obama on Wednesday rejected a Canadian company's plan to build a U.S.-spanning, 1,700-mile pipeline to carry oil across six U.S. states to Texas refineries, raising the stakes on a bitter election year fight with Republicans.

    Though the project promises thousands of temporary jobs for the recovering U.S. economy, Obama said a February deadline set by Congress would not allow for a proper review of potential harm from the $7 billion Keystone XL project.


    NBC's Andrea Mitchell reports.

    "As the State Department made clear last month, the rushed and arbitrary deadline insisted on by congressional Republicans prevented a full assessment of the pipeline's impact, especially the health and safety of the American people, as well as our environment," Obama, a Democrat, said.

    The plan proposed by Calgary-based TransCanada would carry oil from tar sands in western Canada to Texas.

    Republicans assailed Obama's decision as a job-killer and said the fight was not over.

    And the State Department said the decision was made "without prejudice," meaning TransCanada can submit a new application once a route through environmentally sensitive areas of Nebraska is established.

    Russ Girling, TransCanada's president and chief executive officer, said the company plans to do exactly that. If approved, the pipeline could begin operation as soon as 2014, Girling said.

    Republicans were not assuaged.

    Newt Gingrich, campaigning for the Republican presidential nomination in South Carolina, called Obama's decision "stunningly stupid," adding: "What Obama has done is kill jobs, weaken American security and drive Canada into the arms of China out of just sheer stupidity."

    House Speaker John Boehner criticizes the White House over its rejection of the Keystone oil pipeline project that many Republicans argue would have created thousands of jobs.

    Sen. John Hoeven, a Republican, has said of the Canadian crude oil: "It's going to go to China if we don't build it here."

    But Alex Pourbaix, TransCanada Corp.'s president for energy and oil pipelines, said last week the company soon will have a new route through the state of Nebraska "that everyone agrees on."

    For now, though, Mitt Romney, the Republican nomination front-runner, called Obama's decision "as shocking as it is revealing," adding that it "shows a president who once again has put politics ahead of sound policy."

    The Republican leader of the House, Speaker John Boehner, said Obama was breaking his promise to create jobs.

    "This is not the end of this fight," said Boehner. He called the pipeline good for the U.S. economy and a major job creator.

    The pipeline proposal has forced the White House to make a politically risky choice between two important Democratic constituencies. Many labor unions back the project because of the prospects of new jobs in a fragile economy. Environmental groups fear the pipeline could lead to an oil spill disaster.

    Some liberal donors threatened to cut off funds to Obama's re-election campaign to protest the project, which opponents say would transport "dirty oil" that requires huge amounts of energy to extract.

    Obama said his decision was not based on the pipeline's merits but on what he called an arbitrary Feb. 21 deadline set by Republicans in Congress. They set the deadline as part of a tax bill that Obama signed into law in late December.

    "I'm disappointed that Republicans in Congress forced this decision, but it does not change my administration's commitment to American-made energy that creates jobs and reduces our dependence on oil," Obama said.

    Under his administration, domestic oil and natural gas production is up, while imports of foreign oil are down, Obama said.

    "In the months ahead, we will continue to look for new ways to partner with the oil and gas industry to increase our energy security," Obama said.

    To underscore the point, Obama signaled that he would not oppose development of an oil pipeline from Oklahoma to refineries along the Gulf of Mexico. TransCanada already operates a pipeline from Canada to Oklahoma.

    Refineries in Houston and along the Texas Gulf Coast can handle heavy crude such as that extracted from Canadian tar sands — the type of oil that would flow through the Keystone XL pipeline.

    Canadian Prime Minister Stephen Harper said he was profoundly disappointed that Obama turned down the pipeline.

    Sen. Kent Conrad, a Democrat, said he doesn't believe the Keystone XL is a dead project. He said the Obama administration did not have enough time to review the project, given the Republican-imposed timeline.

    "I don't believe this is the end of the story," Conrad told The Associated Press. "My personal view is that it should be constructed. It's clear Canada is going to develop this resource, and I believe it is better for our country to have it go here rather than Asian markets."

    Bill McKibben, an environmental activist who led opposition to the pipeline, praised Obama's decision to stand up to what he called a "naked political threat from Big Oil." Jack Gerard, the oil industry's top lobbyist, had said last week that Obama faced "huge political consequences" if he rejected the pipeline.

    "It's not only the right thing, it's a very brave thing to do," McKibben said. "That's the Barack Obama I think people thought they were electing back in 2008."

  • First Read: Newt-mentum returns?

    Jason Reed / Reuters

    Republican presidential candidates former Senator Rick Santorum, R-Pa., and former Massachusetts Governor Mitt Romney listen to former House Speaker Newt Gingrich speaking in a Republican presidential candidates debate in Myrtle Beach, South Carolina, January 16, 2012.

    Is Newt-mentum returning?... Even if so, Gingrich faces two challenges: time and math… Romney’s wealth and Bain Capital have been THE story in the GOP race for the past 10 days (and counting)… Are the first Obama TV ads going up? If so, they will come earlier than the first Clinton and Bush ads did in their re-election years… And Dem convention goes from four days to three days, creating a potential speaking-scheduling problem.

    Read the original First Thoughts: Newt-mentum returns?

    Click here to sign up for First Read emails. 

    *** Newt-mentum returns? There are some increasing signs -- though all of it anecdotal for now -- that Newt Gingrich is gaining some momentum three days before the South Carolina primary. First was his strong debate performance on Monday, from which his campaign cut a new TV ad. Second, the Romney campaign today is holding a conference call (featuring former Sen. Jim Talent and former Rep. Susan Molinari) with the sole purpose of hitting Gingrich, and we haven’t seen one of those from the Romney camp since Iowa. And third, Sarah Palin sort of endorsed Gingrich last night, saying per NBC’s Alex Moe: “If I had to vote in South Carolina, in order to keep this thing going, I’d vote for Newt and I would want this to continue.” Gingrich’s top spokesman responded to the Palin news this way: “We think it’s a pretty darn clear call to arms.” Is Newt-mentum for real? We’ll find out tomorrow morning from our brand-new NBC-Marist poll of South Carolina.

    Recommended: Newt Gingrich slideshow

    *** Gingrich’s two challenges: time and math: Of course, one challenge Gingrich faces is time; there are just three days to go until Saturday’s primary. And the other challenge is the math. It is very possible for Romney to win South Carolina with just 31% or 32% of the vote. That becomes very possible if Ron Paul and Rick Santorum both get about 15%, if Rick Perry gets close to 10%, and if Michele Bachmann, Jon Huntsman, and Herman Cain (who are still on the ballot) get a combined 4% or 5%. But if those percentages are lower, then Romney is forced to win with 34% or 35%.

    *** Romney’s wealth and Bain have been THE story for the past 10 days: It’s worth pointing out, but the central story of the past 10 days in the GOP presidential race has been about Mitt Romney’s wealth and his business practices at Bain Capital. And yesterday, that story received even more attention when Romney revealed 1) that he’s paying an effective tax rate of about 15%, which is far less than the top 35% rate; and 2) that he intends to release his tax returns in April, which could be well after he wraps up the GOP nomination. A few questions we have: Why has Romney acted so cautiously here on his taxes? It makes it seem like he’s afraid of something (perhaps more than folks finding out he pays a 15% rate). How much traction will there be to the revelation that Romney’s father was believed to be the first presidential candidate to release his income taxes -- and release 12 years of them in the year before the 1968 contest? And just how significant was it that the Obama White House, and not the campaign, was pointing this out yesterday?

    *** Are the first Obama ads going up soon? As we first reported yesterday, the Obama re-election campaign is requesting rates for a potential -- and significant -- TV ad buy in key battleground states. And if the Obama ads come out soon, it will be earlier than the first ads that Bill Clinton in ’96 and George W. Bush in ’04 unveiled; both of their campaigns came out with their first ads in March of the re-election year. By the way, here are the battleground states where Team Obama is requesting rates: AZ, CO, FL, IA, MI, MN, NM, NC, NH, NV, OH, PA, VA, and WI. (Arizona, Michigan, and Minnesota are somewhat surprises here. If they are advertising in Minnesota and Michigan come the fall, they’ve got problems; if they’re still advertising in Arizona, then they will be feeling good.) As far as Ohio goes, a new Quinnipiac poll shows Obama’s approval rating there at 44%, and it shows him getting 44% to Romney’s 42% in a hypothetical general-election matchup.

    Click here to sign up for First Read emails. 

    *** Dem convention: From four to three days: In addition to announcing that President Obama would deliver his acceptance speech at Bank of America stadium, Democrats also said yesterday that they were shortening the convention from four days to three. (On Labor Day, they will instead gather at the Charlotte Motor Speedway for a day of organizing.) Make no mistake: This change will have a lasting repercussion. We likely won’t ever see four-day conventions any more. Also, given that they have just three days to work with, Democrats have a potential primetime scheduling challenge on their hands. How do you find three days to fit in primetime speeches by Obama, the first lady, the vice president, the keynote speaker, and Bill Clinton (who you know will want to receive speaking time)?

    *** On the trail, per NBC’s Adam Perez: With just three days until South Carolina’s primary, all the campaign action remains in the Palmetto State: Romney hits Spartanburg, Rock Hill, and Irmo… Gingrich stumps in Winnsboro, Columbia, North Augusta, Easley, and Greenville… Santorum stops in Spartanburg and Laurens… And Perry campaigns in Greer before darting to Greenville for an anti-abortion forum that Santorum also will attend… Meanwhile, Paul is MIA from the campaign trail and returns to DC to vote against raising the nation’s debt ceiling.

    Countdown to South Carolina primary: 3 days
    Countdown to Florida primary: 13 days
    Countdown to Nevada caucuses: 17 days
    Countdown to Super Tuesday: 48 days
    Countdown to Election Day: 293 days


    Text FIRST to 622639, to sign up for First Read alerts to your mobile phone.
    Check us out on Facebook and also on Twitter. Follow us @chucktodd, @mmurraypolitics, @DomenicoNBC, @brookebrower 

  • Tax return often an issue for White House hopefuls

    Mitt Romney's promise to release his 2011 tax return in April follows the practice of leading presidential candidates that began after Watergate. If history is any lesson, questions and criticism will continue long afterward.

    For more than three decades, the major party nominees have released their income tax records. Some offered one year and others more than 10 years of returns. The same has been true for vice presidential candidates, except for Sen. Bob Dole of Kansas when he joined President Gerald Ford on the GOP ticket in 1976.

    Former California Gov. Ronald Reagan broke his longstanding rule of keeping his personal finances private in July 1980 when he released his 23-page 1979 income tax return weeks before accepting the GOP nomination. Sen. Hillary Rodham Clinton weathered weeks of criticism in 2008 for not releasing tax returns showing family income after Bill Clinton left the presidency. She ultimately produced the records in April of that year after taking a pounding from her top party rival, Sen. Barack Obama.

    Even after returns are released, controversies persist. Democratic Sen. John Kerry took heat in 2004 after releasing his returns because his wife, heiress to the Heinz Co. food fortune, initially refused to release hers, which were filed separately. Four years later, Republican Sen. John McCain faced similar criticism because his wife didn't release her separately filed returns, which reflected income from a Phoenix-based beer distributing company she inherited. She later released the two top summary pages of one year's return, the same that Kerry's wife had released.

    Now it's Romney's turn. Texas Gov. Rick Perry, who released his own tax returns dating back to 1991, urged Romney during a debate Monday to release his. Romney, whose net worth is estimated at roughly $250 million, previously had resisted calls to release his tax returns. Anticipating a key question about his taxes, Romney disclosed Tuesday that he pays an effective federal tax rate of about 15 percent, still higher than the rate paid by many Americans.

    Romney said in the debate that he will decide whether to release returns in the coming months.

    "I hadn't planned on releasing tax records because the law requires us to release all of our assets, all the things we own. That I have already released," he said. Later, he added, "What's happened in history is people have released them in about April of the coming year and that's probably what I would do."

    Romney's right. There is no law requiring presidential candidates to release personal tax information. Since 1978, however, they've had to disclose information about their income and some about their assets, like real estate holdings, investments and outside business interests. But those disclosures only show a range of values for assets, making it impossible to use those forms to identify a candidate's actual wealth.

    He's also right that many leading candidates in recent history chose April to release their tax returns.

    On Tuesday, Romney gave reporters in South Carolina more insight into his plans, saying he would release one year of his tax returns, not the six previous years that Obama released as a candidate in 2008 or even the two years that McCain released that year.

    "People will want to see the most recent year," Romney said.

    He said he's paid "closer to the 15 percent rate" in taxes because most of his income has come from investments and not ordinary wages, which have a top tax rate of 35 percent for those with the highest earned income.

    When he ran in 2008 Romney refused to release his tax returns, and he previously had filed only state financial disclosures that described his assets in the most general terms.

    Former House Speaker Newt Gingrich of Georgia has said he will release his tax returns Thursday.

    Even when tax returns are released, they offer only a narrow snapshot into a candidate's financial background. But some candidates in the past, like former Georgia Gov. Jimmy Carter in 1976, have offered more specific breakdowns of their financial worth.

    Some of the bigger controversies over tax returns have belonged to vice presidential candidates. Geraldine Ferraro was a little known New York City congresswoman when the Democratic nominee, Sen. Walter Mondale, chose her as his running mate in 1984. The euphoria of that history-making selection of a woman for a major presidential ticket ended abruptly when Ferraro began battling criticism over her husband's refusal to release his separately filed tax returns. After they finally relented, she faced more controversy over accounting errors and other questions in the returns.

    George H.W. Bush was Reagan's vice president at the time and became one of Ferraro's biggest critics on the issue, only to face his own controversy that year when he initially declined to release three years of returns. Bush argued he couldn't release them because he had turned his personal financial affairs over to a blind trust when he became vice president. But he ultimately released the returns weeks before the 1984 election.

    Dick Cheney, George W. Bush's running mate in 2000, got blasted after releasing his returns for his financial ties to a Dallas-based oil company and for charitable giving that amounted to less than 1 percent of his income. After becoming Obama's running mate in 2008, Sen. Joe Biden faced similar criticism over his charitable giving once his tax returns became public.

    In 2008, Alaska Gov. Sarah Palin's tax returns for two years triggered scrutiny because Palin, then McCain's running mate, did not list per diem payments the state made to her when she stayed in her own home. She later had to pay taxes on the payments.

  • House to take symbolic vote against debt hike

    The House on Wednesday is kicking off another session under GOP control by staging a politically-fueled vote against raising the government's borrowing cap by $1.2 trillion as permitted under last summer's bipartisan debt and budget pact.

    Under that law, supported by all of the top GOP leaders on Capitol Hill, the debt limit is automatically raised 15 days after the president officially notifies lawmakers that the government is close to the current $15.2 trillion cap — unless Congress votes to deny the borrowing increase.

    Wednesday's measure to block the debt increase is expected to pass the House easily. But it's a dead issue in the Senate, and Obama's veto power serves as a final guarantee that the increase will go through as intended and that the nation won't face another debt crisis like last summer.

    The political dance was designed to permit lawmakers, mostly Republicans, to vote against the debt increase but not actually block it, which would provoke a first-ever, market-rattling default on U.S. government obligations.

    Republicans are seizing the measure as an opportunity to highlight the record deficits racked up during Obama's first term in the White House.

    "This resolution keeps the government's spending problem in the forefront of our conversation and demonstrates that we in the House are committed to ending the decades-old borrowing and spending mentality in Washington," said Rep. Tom Reed, R-N.Y. "Many want this issue swept under the rug until after Election Day. We will not let that happen."

    But Democrats say the whole exercise is little more than political theater.

    "If it were to pass and to be signed by the president, everybody, I presume, understands it would be a very negative thing to happen," said Rep. Steny Hoyer of Maryland, the No. 2 Democrat in the House.

    Last year's debt agreement permits a total debt limit increase of $2.1 trillion in exchange for an equivalent amount in spending cuts, which would be spread out over the coming decade. The first $900 billion comes from caps on the day-to-day operations of federal agencies. 

  • Enough signatures collected to force Wis. Gov. Walker recall election

    Mark Hirsch / Getty Images

    Recall volunteers add to the stack of boxes containing signatures to recall Gov. Scott Walker on Tuesday.

    MADISON, Wis. -- Opponents of Wisconsin's Republican Gov. Scott Walker submitted nearly twice as many signatures Tuesday as required to force a recall election, but still face the challenge of transforming public outrage over his moves against unions into actual votes to oust him from office.

    If Walker is worried, he's not showing it: As the petitions were delivered to election officials, Walker was out of state raising money to defend himself and the agenda that has made him a national conservative hero.

    The 1 million signatures that United Wisconsin, the coalition that spearheaded the effort along with the Democratic Party, said were collected far exceeds the 540,208 needed and amounts to 23 percent of the state's eligible voters.

    Walker was elected in 2010 as part of a national Republican tide, and quickly angered unions and others with aggressive moves that included effectively ending collective bargaining rights for nearly all public workers.

    Recall circulators in neon vests who were turning in the petitions Tuesday surrounded a U-Haul truck filled with boxes of documents. The group held hands and formed a line leading toward the office of the Government Accountability Board, as some protesters yelled anti-Walker chants. The boxes inside the office full of petitions targeting Walker were stacked five high and 11 rows deep.

    Petitioners said they were submitting about 305,000 more signatures than were needed to trigger a recall election against Lt. Gov. Rebecca Kleefisch, and said they also exceeded the number needed to force recall elections of four Republican state senators, including Majority Leader Scott Fitzgerald.

    Walker's supporters would have to successfully challenge about 46 percent of the signatures to stop a recall election, in which the governor would likely run against a yet-to-be-decided Democratic challenger.

    "I don't know if it's insurmountable, but it would be extremely difficult," said Joshua Spivak, a recall expert and senior fellow at Wagner College in New York.

    During the recall of California Gov. Gray Davis in 2003, petitioners also turned in almost double what was needed and only about 18 percent were tossed, Spivak said.

    Wisconsin Democratic Party Chairman Mike Tate said given the number of signatures collected, Walker shouldn't seek delays and instead let the vote proceed.

    "Does anyone really honestly believe we're not going to have an election?" Tate said.

    Spivak said he would expect strong voter turnout for a recall election against Walker, noting that in California turnout rose from 36 percent in the general election to 61 percent for the Davis recall.

    "There's going to be so much focus on this, it is not going to be like a special election where turnout is suppressed," Spivak said.

    'Stand with me'
    Walker expressed confidence Tuesday that he will survive a recall and that voters will reward him for balancing a $3.6 billion budget shortfall without laying off state employees or raising taxes.

    "I look forward to talking to the people of Wisconsin about my continued promises to control government spending, balance the budget, and hold the line on taxes," he said in a statement.

    "Instead of going back to the days of billion-dollar budget deficits, double-digit tax increases and record job loss, I expect Wisconsin voters will stand with me and keep moving Wisconsin forward."

    Republican Party Chairman Brad Courtney issued a statement denouncing what he called a baseless and expensive recall. An election is expected to cost at least $9 million.

    The governor's supporters have been training volunteers how to vet signatures and they plan to create a database where names will be entered and verified. Walker has already successfully sued the state elections board to require it to do a more extensive review of the signatures than originally planned in order to catch duplicates and obviously fake names like Mickey Mouse.

    The Government Accountability Board has said its review will take 60 days or more and it will go to court as soon as this week to seek more than the 31 days allowed under the law. Board director Kevin Kennedy said it was too early to know how long would be needed or if officials would stop the review once they determined enough were valid to certify an election.

    Tate said he didn't expect a Walker recall election would happen before May. Walker has said he thinks it will be in June.

    Recalls have become common in Wisconsin since the political tumult of 2011 that saw Walker and Republicans pass the collective bargaining changes, one of the country's most restrictive laws requiring photo identification at the polls, and a budget that included an $800 million cut to public schools.

    The opposition started with massive protests and then grew into organized campaigns — first to recall state senators, then Walker himself. Last summer, six Republican state senators and three Democrats faced recall elections. Two Republicans lost, leaving the party with a one-vote majority in the Senate.

    A recall against Walker couldn't officially be filed until after he had served a year in office, an anniversary reached earlier this month.

    But Walker hasn't been waiting around to see what happens. He has been on the air nonstop, saying that while some of his decisions to balance the budget were difficult, the state is in a better financial position and will prosper in the long run.

    The governor has been raising money at a furious clip. He was hosting a $2,500 per-person fundraiser in New York City on Tuesday and recently attended fundraisers in Texas, Kentucky and Tennessee. He is taking full advantage of both the conservative star persona he built as he put Wisconsin at the center of the national labor rights debate and a quirk in state law allowing those targeted for recall to ignore normal contribution limits until an election date is set.

    As of mid-December, he had raised $5.1 million, with about half coming from out-of-state donors.

    Democrats, who have no candidate raising money to challenge Walker, concede they will not be able to match him dollar for dollar. Instead, they are counting on the same type of energy that drove the protests and the petition drive to translate into the campaign.
    Two prominent Democrats, former U.S. Sen. Russ Feingold and retiring U.S. Sen. Herb Kohl, have repeatedly said they aren't interested. Milwaukee Mayor Tom Barrett, who lost to Walker by 6 percentage points, issued a statement praising recall circulators but did not indicate whether he would enter the race.

    Besides Davis, the only other successful recall of a governor in the nation's history was North Dakota Gov. Lynn Frazier in 1921.

  • Romney takes fire on Bain, tax returns in latest GOP debate

    Republican presidential frontrunner Mitt Romney faced tough questions from his rivals at Monday's debate in South Carolina, including a direct challenge to release his income tax returns. NBC's Peter Alexander reports.

    Updated at 11:03 p.m. ET

    In the sixteenth debate of the 2012 campaign in South Carolina Monday night, Mitt Romney emerged with a steady if unspectacular performance, fending off criticism from former House Speaker Newt Gingrich over his tenure as head of Bain Capital.

    But under pressure from Texas Gov. Rick Perry and from one of the debate moderators, Romney sounded a bit vague and elusive on precisely when he would release his tax returns.


    “We cannot fire our nominee in September -- we need to know now” if he has any vulnerabilities, Perry said. Romney said he would "probably" release his tax returns in April. By that point he may have locked up the GOP nomination. Saturday’s South Carolina primary is likely to be the decisive event of the GOP presidential campaign.

    The other contenders all had their moments of prominence. Former House Speaker Newt Gingrich did not back off from his criticism of Romney’s tenure as head of Bain Capital – but he also did not add any new details to his indictment of Romney.

    “I raised questions I think are legitimate questions” Gingrich said. “That’s part of a what a campaign is about” -- to raise questions “before you get a to a general election.”

    Karl Rove, the chief strategist for George W. Bush's presidential campaigns, tells TODAY's Matt Lauer that GOP presidential frontrunner Mitt Romney "solidified his hold on first place" at Monday's debate in South Carolina.

    He said that there was “a pattern in some companies” that Bain invested in of “leaving them with enormous debt” and then bankrupt.

    Perry also joined the attack on Romney for Bain’s investment in a steel mill in South Carolina. “Bain swept in” and “they picked that company over and a lot of people lost jobs there," Perry said.

    Romney responded that it was cheap foreign steel imports that had caused the problems at the South Carolina steel mill and other mills.

    Romney also said that four of the Bain-sponsored companies had added 120,000 jobs to the economy. He added that Bain had invested in well over 100 different businesses. “I had experience turning around tough situations,” he said, and that, he said, is what led to him being asked to run the Salt Lake City Olympics and to run for governor of Massachusetts.

    Santorum, too, pressed the attack on Romney and seemed to catch him in an awkward spot when he charged that Romney’s own state had a more liberal law allowing convicted felons to vote than a felon voting law that Santorum had voted for in 2002 when he served in the Senate.

    And yet, Santorum said, a Romney-allied group was attacking him for that vote. Romney replied that he believed that people convicted of violent felonies should not be able to vote, but that Democrats controlled the state legislature in Massachusetts.

    Rep. Ron Paul of Texas got a wave of hostility from the debate audience when he was asked about the killing of Osama bin Laden and argued that even Saddam Hussein and Nazi war criminal Adolf Eichmann were captured and were put on trial – rather than killed.

    Raucous booing followed when Paul tried to argue for a Golden Rule in foreign affairs, “Don’t do to other nations what we don’t want them to do to us.”

    'Work is good'
    Earlier in the debate, Gingrich hit President Obama with harsh rhetoric, calling him "the best food stamp president in American history." He said the difference between the GOP candidates and Obama was that "we actually think work is good," implying that Obama wanted unemployed people to remain dependent on public benefits.

    The dramatic highlight of the debate may have come about an hour into the event when Gingrich got into a tussle with Fox News panelist Juan Williams, who asked about Gingrich advocating that young people get janitorial jobs.

    “Only the elites despise earning money,” Gingrich snapped.

    Williams then asked whether Gingrich’s “food stamp president” comment about Obama was an example of him “seeking to belittle people.”

    Gingrich shot back a heated response, charging that “more people have been put on food stamps by Barack Obama than by any president in American history.”

    Earlier Monday, Jon Huntsman, the former Utah governor and former envoy to China, announced that he was withdrawing from the race, having suffered a weak third-place finish on Tuesday in New Hampshire. Huntsman threw his support to Romney, calling him “the candidate who is best-equipped to defeat the president and return conservative leadership to the White House.”

    Gingrich said Monday that if he wins the primary, he will win the Republican nomination: “South Carolina is going to pick the nominee.”

    With Paul getting support from libertarians and those who like his anti-interventionist foreign policy, that leaves the social conservative vote split among Gingrich, Perry, and Santorum. None of the three has been strong enough to unite the conservative factions.

  • Evangelical leaders back Santorum

    A major push by social conservatives involves 150 evangelical leaders uniting behind one of Mitt Romney's rivals to stop him from running away with the nomination. NBC's Peter Alexander reports.

    Influential evangelical Christian leaders on Saturday endorsed Rick Santorum for the Republican U.S. presidential nomination, in an attempt to strengthen him as the more conservative alternative to front-runner Mitt Romney.

    At a weekend meeting at a ranch outside Houston, the group of 150 conservatives agreed on the third ballot to support the former Pennsylvania senator.

    They had not been expected to reach agreement on one candidate since evangelical support was splintered among Santorum, former U.S. House of Representatives Speaker Newt Gingrich and Texas Governor Rick Perry.

    "What I did not think was possible appears to be possible," said Tony Perkins, leader of the Family Research Council and spokesman for the group.

    Perkins described a "vigorous and passionate" discussion about who would make the best president and said eventually people made concessions to their views in order to coalesce around one candidate.

    Conservatives are desperate to find a viable alternative to Romney, who won the first two nomination contests in Iowa and New Hampshire and now leads the polls in South Carolina, which holds its Republican primary on Jan. 21.

    In the 2008 election, about 60 percent of the voters in South Carolina described themselves as evangelical Christians. Santorum is a Catholic and father of seven who strongly opposes abortion and gay rights.

    Despite Romney's front-runner status, many conservatives mistrust him because of his record in relatively liberal Massachusetts, where he once supported abortion rights.

    "Not a lot of time was spent on Mitt Romney. It was more about the positive. How to get America back on the right road. How to get America great again," Perkins said.

    As the South Carolina primary looms, 2012 GOP presidential candidates hope to gain the backing evangelical voters. NBC's Kelly O'Donnell reports.

    Perkins said the group debated and prayed over who to pick but in the end chose the person they believed had the best social conservative and economic policies and was most likely to defeat Democratic President Barack Obama in the Nov. 6 election.

    Santorum's nearest rival was the twice-divorced Gingrich.

    Gingrich's campaign has begun airing TV ads in South Carolina that call Romney "pro-abortion," and say that Romney - who says he now opposes the procedure - cannot be trusted to be reliably anti-abortion. In response, Romney began running a radio ad touting his anti-abortion views.

    Perkins said all factors were taken into account at the Texas meeting and said that Romney's Mormon religion "wasn't even discussed."

    Copyright 2013 Thomson Reuters. Click for restrictions.
  • Perry meets South Carolina voters ahead of the next primary

    David Goldman / AP

    Republican presidential candidate, Texas Gov. Rick Perry waits to be introduced at a campaign stop at the Hilton Head Diner, Friday, Jan. 13, 2012, in Hilton Head, S.C.

    David Goldman / AP

    Mary Amonitti of Hilton Head, S.C., asks a question to Republican presidential candidate, Texas Gov. Rick Perry during a campaign stop at the Hilton Head Diner, Friday, Jan. 13, 2012, in Hilton Head, S.C.

    After Perry lost an important South Carolina backer, he's changed the focus of his attacks to Obama rather than Mitt Romney on the campaign trail today at a diner in Hilton Head. NBC's Mark Murray breaks down where all the campaign money is being spent in the Palmetto state.

    The South Carolina Republican primary is Jan. 21.  It will take 1,144 delegates to win the nomination at the Republican national convention this summer. So far, Perry has collected no delegates.

    Mark Lambie / El Paso Times via AP

    The nation's longest-serving current governor and his presidential run.

     

  • Pardon power varies widely

    © Sean Gardner / Reuters / REUTERS

    Haley Barbour speaks during the Republican Leadership Conference in New Orleans, Louisiana in this June 17, 2011 file photo.

          Most states give their governors broad latitude in granting pardons.  Some don't trust them with that authority at all. And the rest allow a governor to grant pardons only with the recommendation of other state officials.

          Mississippi's raging controversy over last-minute pardons by outgoing governor Haley Barbour has generated calls for limiting the ability to grant pardons in that state.  A survey of the clemency power reveals that states vary widely in the degree of authority placed in the hands of the nation's chief executives.  

          The US Constitution gives the president virtually unlimited authority.  A president can grant pardons for federal crimes, even before a person is charged, tried, or convicted -- most vividly demonstrated when Gerald Ford granted Richard Nixon "a full, free, and absolute pardon" for any crimes Mr. Nixon may have committed during the Watergate scandal of the early 1970's. 

          In 1977, President Jimmy Carter issued a blanket amnesty, a form of pardon, to anyone who evaded the draft during the war in Vietnam.

          Only one restriction is placed on the president.  No pardons can be given in cases of impeachment.  Congress alone controls that process.

          Most state constitutions, 37 in all, give their governors broad powers to grant pardons for those convicted of state offenses.  Nearly all follow the federal model and deny a governor the power to pardon officials who were subject to state impeachment proceedings.

          In five states -- Alabama, Louisiana, Oklahoma, Pennsylvania, and Texas -- a governor can issue pardons only upon the recommendation of a state pardon board.

         Florida is a hybrid: a governor may grant pardons, but only with the approval of at least two members of his cabinet.

          But seven states -- Delaware, Georgia, Idaho, Nebraska, Nevada, South Carolina, and Utah -- put the authority exclusively in the hands of a state pardon or clemency board, not the governor. 

          The pardons granted in Mississippi as Haley Barbour walked out the door of the governor's office are in doubt because of an unusual requirement of that state's constitution. 

          It provides that clemency cannot be granted until the person seeking it arranges to have the pardon application published "for thirty days" in a newspaper in the country where the crime was committed.  The attorney general in Mississippi asked a state judge to put a stop to the pardon process there until his office verifies that sufficient notices were actually published.

          A judge has halted the granting of Barbour's pardons for inmates not yet released.  And law enforcement officers are hunting down those who had already served their time when the pardons were issued.  The judge will sort out which pardons turned out to be validly granted.

          So far, Mississippi officials say it appears that five of the most controversial pardons, including four men convicted of murder, did not meet that requirement.  All five had worked at the governor's mansion under a program granting privileges to trusted inmates.

          Two other states, Idaho and Maryland, impose similar requirements that pardon applications must be published before they can be granted.

          The roots of the clemency power in the United States stretch back to England, where the king or queen could grant pardons, and the earliest state constitutions included the authority in some form.

  • Obama seeking to shrink government after presiding over increase in headcount

    President Barack Obama discusses his proposal to shrink the federal government.

    President Barack Obama said Friday that he will ask Congress for authority to consolidate agencies that deal with international trade, business and patents. Those agencies are now within the Commerce Department, the Office of U.S. Trade Representative and other departments.

    Obama said his goal was “a leaner government” and that he would “modernize and streamline” the bureaucracies. He told a White House audience that no private-sector business leader would tolerate the “duplication” and “unnecessary complexity” that now exist in the federal bureaucracies that deal with business and trade.

    The Commerce Department now has about 47,600 employees, up from about 42,600 in 2008.

    Recommended: Obama seeks power to merge agencies

    Obama’s restructuring would result in the elimination of between 1,000 and 2,000 jobs and save $3 billion over ten years, according to an administration official who briefed The Associated Press.

    During his three years in office Obama has presided over an increase in the federal executive branch work force, which has grown from 1,938,821 in September of 2008 to 2,130,289 as of September 2011, the most recent month for which the federal Office of Personnel Management has data. This is nearly a 10 percent increase in headcount from 2008 to 2011.

    Right before Christmas, the House Oversight and Government Reform Committee approved a bill sponsored by Rep. Mick Mulvaney, R- S.C., that would reduce the federal civilian workforce by 10 percent by fiscal year 2015. Only one Democrat on the committee voted for the bill as did 22 Republicans.

    The Congressional Budget Office estimated that the bill would cut $35 billion in spending from 2012 to 2016.

    But Democrats on the committee opposed the bill saying it “unfairly targets the federal workforce” and forces federal employees “to shoulder a disproportionate share of the burden of solving our fiscal problems.”

  • Jobs gains may not help Obama's re-election bid

    The recent improvement in the job market comes as welcome news for President Obama as he struggles to answer GOP attacks on the campaign trail that he’s mismanaged the economic recovery. There are a lot of reasons, though, that it may be too early for the White House to start cheering about jobs.

    There's no shortage of issues vying for voter attention as the 2012 presidential campaign kicks into gear. But with unemployment stuck above 8.5 percent for the 34th month in a row, the job market likely will top the list until the November election.

    The White House hammered on the issue again week, as the president rolled out yet another round of job-creation proposals at a meeting with business leaders in the White House. This one is aimed at “insourcing” jobs that have been lost to overseas companies.

    "I don’t want America to be a nation that’s primarily known for financial speculation and racking up debt buying stuff from other nations," he said Wednesday in the East Room to a smattering of applause. "I want us to be known for making and selling products all over the world stamped with three proud words: 'Made in America.'  And we can make that happen."

    The Obama administration has good reason to focus on boosting job growth. History shows that the trend in the unemployment rate can be more important to an incumbent's chances than the unemployment rate itself. Since 1956, every incumbent president has won re-election when unemployment fell over the two years leading up to the election. And none has won a second term when it rose.

    After an historic wave of layoffs during the 2007 recession, the job market is showing convincing signs of life again. A week ago, the government reported that the unemployment rate fell to 8.5 percent, the second monthly drop. New weekly claims for unemployment insurance, despite a surprise bump higher this week, have been trending lower to levels economists say are consistent with an improving job market.

    But those headlines create the first potential hazard for the White House. Economists note that an improved job outlook typically brings “discouraged” workers back in the official count of the total workforce; to be counted, you have to be actively looking for work. 

    As those discouraged workers begin looking again, they're added to the statistical pool of jobless workers. But unless they find jobs right away, their re-entry will push the unemployment rate higher. 

    Like many employment statistics since the 2007 recession, the surge in discouraged workers was extreme. The labor force participation rate - the percent of the population considered part of the workforce - is at the lowest level in nearly 30 years.

    From a low of 363,000 when the recession began in December, 2007, the number of workers who are too discouraged to look for work more than tripled to 1.3 million last December. Since that peak, better job prospects have lured some of those people back in the workforce. But as of December 2011, some 945,000 still reported they had given up looking for a job.

    Though job growth has picked up, it's still not strong enough to re-hire the large pool of workers left behind by the recession. From a low of 6.7 million in early 2007, the number of people out of work more than doubled to about 15.4 million in October, 2009. While it has since eased to 13.1 million, the current pace of job growth - an average of 162,000 new jobs were created each month in 2011 - is barely enough to keep up with the population growth.

    The Obama administration has its work cut out for it to boost the pace of hiring. One big hurdle: Companies from manufacturers to oil producers report that they want to hire but  can't find workers with the skills they need. The purported skills mismatch has left behind millions of workers with low-tech skills whose jobs may never come back. Even as the economy recovers, economists say that "structural" unemployment will remain stubbornly resistant to the improving job outlook.

    For now, those long-term jobless workers are staying afloat with the help of unemployment insurance, which has become a divisive political issue. After several rounds of extensions, the current program provides up to 99 weeks of benefits for workers who have paid into the  system. Congressional Republicans are gunning for major changes in the program after agreeing to a two-month extension in December.

    One would cut back the total number of weeks of eligibility, cutting off benefits for millions of households. The other looks to limit eligibility to those who finished high school, unless they're enrolled in a program for an equivalency diploma.  That battle, which heats up next month when the two-month extension expires, will open a new front in GOP attacks on the White House jobs policy. 

    While recent economic data are pointing the right direction, companies aren't creating new jobs as fast as they're booking higher profits. Even as hiring has picked up, the number of jobs openings declined, according the Labor Departments’ monthly Job Openings and Labor Turnover Survey (JOLTS). Employers filled nearly 4.15 million jobs in November, but the number of job openings shrank by 63,000, to 3.2 million. There still aren't enough jobs to go around: there's roughly one job open for every four people out of work, according to the JOLTS data. 

    Business also aren't using their rising profits to boost workers' paychecks. Though consumer spending is rising, it's coming from more borrowing, not higher wages.

    "The consumer has been spending beyond his means once again," said private economist Gary Shilling. "We have seen a decline in the savings rate and a run up in borrowing. I don't think that's sustainable."

    Shilling believes that a looming consumer spending crunch could bring on another recession in 2010. If that happens, President Obama will have an even tougher time getting re-elected.

    "My Labrador retriever could get elected if we have a recession year," said Shilling. 

  • First Read: Best of times (and worst of times) for Romney

    Jason Reed / Reuters

    Republican presidential candidate and former Massachusetts Governor Mitt Romney meets with supporters at the Hall at Senate's End in Columbia, South Carolina, January 11, 2012.

    This week represented the best of times for Romney (at it relates to the primary) and also the worst of times (for the general election)… New Romney TV ad plays defense on Bain… Obama camp piles on Bain… Don’t forget: In the GOP primary four years ago, attacking Bain was fair game… Social conservatives to meet this weekend in Florida… Colbert’s presidential run (!!!)… Five pardoned by Barbour (including four murderers) can’t be found… Craig James admits to taking $$$ while at SMU… And Reid, Gingrich to appear on “Meet” this Sunday.

    Read the original First Thoughts: Best of times (and worst of times) for Romney

    NBC's David Gregory talks to TODAY's Matt Lauer about whether fierce attacks on Republican presidential frontrunner Mitt Romney will backfire against his rivals or stop what seems to be Romney's inevitable march to the nomination.

    *** Best of times (and worst of times) for Romney: To paraphrase Dickens, this week represented the best of times for Mitt Romney. He decisively won the New Hampshire primary and heads into South Carolina and beyond full with momentum; he raised $24 million in the last quarter, demonstrating his fundraising chops; and even some of his skeptics inside the Republican Party realize that he most likely will be the GOP’s nominee. But when you begin mapping out November’s general election, this week also proved to be the worst of times for Romney. His GOP rivals’ attacks on Bain Capital -- and his response to them -- suggested that his chief strength (private-sector business experience) could be turned into a weakness; he committed unforced errors that played into the Gordon Gekko narrative (“I like being able to fire people,” “pink slips,” and “I think it’s about envy”); and NBC’s Michael Isikoff hasreported that his top donors are bigwigs from private equity firms. Bottom line: Romney had a good week in the Republican primary and a bad week for the general election

    *** New Romney ad plays defense on Bain: This morning, the Romney campaign is up with a new TV ad in South Carolina that defends his Bain record and criticizes his GOP rivals for attacking it. It’s the first defensive ad of the campaign from Team Romney “Mitt Romney helped create and ran a company that invested in struggling businesses, started new ones, and rebuilt old ones, creating thousands of jobs. Those are the facts,” the narrator states in the ad. “We expected the Obama administration to put free markets on trial, but as the Wall Street Journal said, ‘Mr. Romney’s GOP opponents are embarrassing themselves by taking the Obama line.’” As we noted yesterday, Romney is stuck in a tough place. Emotionally, the sad stories of the laid-off workers will strike a chord; the positive stories of Staples and Sports Authority will help blunt a little -- but logical or “head’ defenses are usually never as effective in campaigns when attacks pull at the heart. By the way, another company Romney highlights in this new TV ad is Steel Dynamics. It’s a company that was helped tremendously by government tax breaks and subsidies, not exactly popular among some inside the current Republican Party.

    *** The Obama camp piles on Bain: And just as his GOP rivals began to back off their Bain attacks (see: Perry, Rick), the Obama re-election campaign is now piling on. This morning, campaign strategist Stephanie Cutter fired off this scathing memo about Romney’s past work at Bain, which also telegraphs how the Obama campaign plans to attack Romney on this front: "'Free enterprise' isn’t running for president, Mitt Romney is. And voters deserve straight answers about his record, so they can know how his perspective would influence his decisions and actions if he were president of the United States." More: "For instance, voters in South Carolina deserve to know about the millions Romney and his partners made off closing down the 114,000-square-foot Holson Burnes factory in Gaffney, where workers made photo albums and picture frames. Just four years after the factory opened, Bain fired 150 workers and shipped some of the operation overseas. According to the Associated Press, Bain more than doubled the return on the original investment while 'workers were left jobless just as the local economy began to slump.'"

    *** Bain was fair game four years ago: In the last couple of days, we’ve seen an intra-party food fight over Bain. Limbaugh, DeMint, McCain, Giuliani, and Club for Growth have criticized the GOP attacks on Bain, while Sarah Palin has said that the scrutiny is fine with her. But here is something worth remembering: Bain Capital was fair game in the Republican primary four years ago. Back then, McCain said Romney “presided over the acquisition of companies that laid off thousands of workers." And here was Mike Huckabee: “I want to be a president who reminds you of the guy you work with, not the guy who laid you off.” And: “[T]here are a lot of people who lost their jobs when his company would take over, restructure a company, lay a lot of people off. Lot of times, the CEOs and the people at the top got some pretty huge bonuses and made a lot of money. A lot of people went home without a pension and a paycheck.” Yet McCain, Huckabee, and others were never criticized for being anti-capitalism. The difference this time around: Republicans obviously want the Bain critics to back because they realize: 1) Romney is the likely nominee, and 2) these attacks aren’t helping their party. 

    *** Social conservatives meet in Texas: This weekend, social conservatives are meeting in Texas to see if they can rally around an alternative to Mitt Romney. But here is something they probably need to consider: If they are going to rally around someone else, they also have to take down the nominee. Why? If they don’t succeed, then they have probably alienated the person who will be the Republican nominee and the leader -- at least for several months -- of the political party they support.

    *** Perry’s latest d’oh moment? Perry flubbed his three departments once again, NBC’s Carrie Dann reports. During a radio interview this morning, he was asked which federal departments he would shut down. Perry listed: "Three right off the bat: Commerce, Interior, and Energy are the three that you think of." Problem: Those are NOT the three he had previously not been able to name. He swapped Interior for Education. He has not previously said he would eliminate Interior. The radio host later followed up and asked Perry if he would eliminate Education, and Perry responded with a harsh critique of federal education standards. A Perry spokesman’s spin to reporters later: "Every agency is on the chopping block" and that all departments would be scrubbed and evaluated. "It shouldn't be surprising that the governor is talking about another agency that needs to be looked at and cut," spokesman Mark Miner said.

    *** Colbert’s presidential run: For some campaign humor, comedian Stephen Colbert announced on his show last night that he would form an “exploratory committee for president of the United States of South Carolina,” the New York Times writes. However, as NBC’s Ali Weinberg notes, South Carolina doesn’t allow write-in ballots for president. And get this: The Colbert Super PAC -- Americans for a Better Tomorrow, Tomorrow -- has placed a broadcast ad buy in the Palmetto State. You can’t make it up.

    *** On the trail: It’s a relatively slow day for most candidates as they campaign throughout South Carolina and Florida: Gingrich hits the Sunshine State, campaigning in Miami and Orlando then jetting to Duncan, SC for a GOP presidential candidate forum, to which Huntsman and Santorum are also attending… Perry continues his trek throughout South Carolina rallying in Hilton Head, Bluffton, and Charleston… Romney visits Doral, FL and then travels back to South Carolina… And for the second day, Paul is a no-show on the campaign trail.

    *** Five pardoned by Barbour can’t be found: The headlines for ex-Mississippi Gov. Haley Barbour are getting worse. Here’s the latest from the Jackson Clarion-Ledger: “5 pardoned can’t be found.” From the story: “Four murderers and one robber that former Gov. Haley Barbour pardoned last week are likely to return to prison, but officials from the attorney general's office were still searching for them Thursday night. None of the five men, all of whom worked as trusties in the Governor's Mansion - David Gatlin, Charles Hooker, Anthony McCray, Joseph Ozment and Nathan Kern - met a crucial deadline required for receiving a pardon a week ago today. They are among 208 prisoners Barbour granted clemency days  before he left office on Tuesday. Barbour maintains he pardoned many who already had been released so that they could obtain employment.”  As we noted yesterday, Barbour’s considered a key cog in the Republican effort to build a national campaign to not just raise money for the presidential race (via American Crossroads) but also for the GOP’s campaign to hold the House and take back the Senate. If Barbour becomes politically radioactive, it’s potentially a BIG problem for the super-est of Super PACs: Crossroads.

    *** Craig James admits to accepting money while at SMU: And don’t miss this: Texas Senate candidate Craig James -- the former college star and ESPN commentator -- admitted to accepting payments when he played at SMU, which ultimately received the NCAA’s death penalty. The Houston Chronicle writes, “[H]e concedes he did wrong as a football player at Southern Methodist University where he accepted illegal handouts from school boosters. The amount he accepted was ‘insignificant,’ declining to tell reporters how much he took during his playing days in the 1980s. He spoke cryptically of ‘$20 handshakes.’” More: “‘I didn’t have the maturity to turn it away,’ James said, adding he did ‘not really’ know that it was wrong at the time.” By the way, football players admitting to taking money in college is kinda like baseball players finally admitting they took performance-enhancing drugs. Everyone knows they did it even as they deny it. And when they finally admit it, it only stains the ENTIRE game. For James, this VERY late confession means he starts his campaign with a character issue.

    *** Reid, Gingrich to appear on “Meet”: On “Meet the Press” this weekend, NBC’s David Gregory interviews Senate Majority Leader Harry Reid, Newt Gingrich, South Carolina Sen. Lindsey Graham, and South Carolina GOP Rep. Tim Scott. On Meet's weekly "PRESS pass," Gregory interviewed Suze Orman

    Countdown to South Carolina primary: 8 days
    Countdown to Florida primary: 18 days
    Countdown to Nevada caucuses: 22 days
    Countdown to Super Tuesday: 53 days 
    Countdown to Election Day: 298 days

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  • Obama seeks power to merge agencies

    Kevin Lamarque / Reuters, file

    President Barack Obama speaks about the economy and a payroll tax cut compromise during a visit to Osawatomie High School in Kansas December 6, 2011.

    President Barack Obama on Friday took aim at his government's own messy bureaucracy, prodding Congress to give him greater power to merge agencies and promising he would start by collapsing six major economic departments into one. Pressing Republicans on one of their own political issues, Obama said it was time for an "effective, lean government."

    Obama wants the type of reorganizational authority last held by a president when Ronald Reagan was in office. Obama's version would be a so-called consolidation authority allowing him to propose only mergers that promise to save money and shrink government. The deal would help Obama considerably by entitling him to an up-or-down vote from Congress in 90 days.

    Recommended: Obama formally requests increase in debt ceiling 
    Still, final say would remain with lawmakers, both on whether to grant Obama this fast-track authority and then in deciding whether to approve any of his specific ideas.

    "We can do this better," Obama declared in an event with business owners at the White House, even presenting slides to help make his case.

    "So much of the argument out there all the time is up at 40,000 feet, these abstract arguments about who's conservative or who's liberal," Obama said. "Most Americans — and certainly most small business owners — you guys are just trying to figure out how do we make things work, how do we apply common sense. And that's what this is about."

    In an election year and a political atmosphere of tighter spending, Obama's move is about more than improving a giant bureaucracy. He is attempting to directly counter Republican arguments that he has presided over the kind of government regulation, spending and debt that can undermine the economy — a dominant theme of the emerging presidential campaign.

    Republicans have often aligned themselves with smaller government. So politically, Obama is trying to put the onus on Republicans in the House and Senate to show why they would be against the pursuit of leaner government.

    From Capitol Hill, a spokesman for Sen. Mitch McConnell of Kentucky, the top Republican in the Senate, pledged Obama's plan would get a careful review.

    But the spokesman, Don Stewart, also said: "After presiding over one of the largest expansions of government in history, and a year after raising the issue in his last State of the Union, it's interesting to see the president finally acknowledge that Washington is out of control."

    Obama has an imperative to deliver. He made the promise to come up with a smart reorganization of the government in his last State of the Union speech last January.

    At the time, Obama grabbed attention by pointing out the absurdity of government inefficiency. In what he called his favorite example, Obama said: "The Interior Department is in charge of salmon while they're in fresh water, but the Commerce Department handles them when they're in saltwater. And I hear it gets even more complicated once they're smoked."

    The White House said the problem is serious for consumers who turn to their government for help and often do not know where to begin.

    Not in decades has the government undergone a sustained reorganization of itself. Presidents have tried from time to time, but each part of the bureaucracy has its own defenders inside and outside the government, which can make merger ideas politically impossible. That's particularly true because "efficiency" is often another way of saying people will lose their jobs.

    Obama hopes to enhance his chances by getting Congress to give him the assurance of a clean, relatively speedy vote on any of his proposals.

    There is no clear sign that Obama would get that cooperation. He spent much of 2011 in utter gridlock with Republicans in Congress.

    In the meantime, Obama announced Friday that Karen Mills, the administrator of the Small Business Administration, would be elevated to Cabinet-level rank. But her job would essentially disappear if Obama has his way.

    If he gets the new fast-track power to propose legislation, Obama's first project would be to combine six major operations of the government that focus on business and trade.

    They are: the Commerce Department's core business and trade functions; the Small Business Administration; the Office of the U.S. Trade Representative; the Export-Import Bank; the Overseas Private Investment Corporation; and the Trade and Development Agency. The goal would be one agency designed to help businesses thrive.

    The White House says 1,000 to 2,000 jobs would be cut, but the administration would do so through attrition; that is, as people routinely leave their jobs over time.

    The administration said the merger would save $3 billion over 10 years by getting rid of duplicative overhead costs, human resources divisions and programs.

    The name and potential secretary of the new agency have not been determined.

    The point, the White House says, is not just making the government smaller but better by saving people time and eliminating bureaucratic nightmares. The idea for the consolidated business agency grew out of discussions with hundreds of business leaders and agency heads over the last several months.

    Brendan Buck, a spokesman for House Speaker John Boehner, R-Ohio, said streamlining government was always a potentially good idea but expressed wariness about whether Obama's plan would really help business.

    "American small businesses are more concerned about this administration's policies than from which building in Washington they originate," Buck said. "We hope the president isn't simply proposing new packaging for the same burdensome approach."

    According to the White House, presidents held such a reorganizational authority for about 50 years until it ran out during Reagan's presidency in 1984.

    Obama has a series of other ideas about consolidating departments across the government, to be rolled out later.

     

  • Conservatives torn over defending, opposing Romney

    Torn between reality and their political dreams, leading conservatives are defending Mitt Romney against attacks on his work in the private sector even as they search for a more palatable candidate amid a growing sense that his nomination may be certain.

    Romney is marching steadily through South Carolina, a state still uncertain about him, and picking up a prominent conservative's endorsement while sending a message to his party: It's time to stop the bickering.

    Not just yet, some conservative leaders say.

    "Honestly, it looks like Governor Romney's nomination is inevitable," said the Rev. Robert Jeffress, pastor of the First Baptist Church of Dallas. "Evangelicals, come November, might have to hold their noses and vote for the lesser of two evils. But it's not November yet."

    Recommended: Guess who's raising money for Romney: Bigwigs from private equity firms 

    Just over a week before South Carolina's first-in-the-South vote, there are signs that conservatives are struggling with their goal of finding what some would call "the anti-Romney." They appear no more organized in their search for a credible challenger than they were before former Sen. Rick Santorum raised their hopes with his second-place finish in Iowa.

    More than 100 conservative leaders, many of them evangelical in their faiths, were set to converge this weekend at the Texas ranch of former state appeals court Judge Paul Pressler to consider their options, if any. Surrogates for each campaign were expected to make presentations and take questions.

    In spite of their reluctance to embrace Romney as the GOP nominee, some conservatives have been drawn into defending him against charges of "vulture" capitalism from rivals Newt Gingrich and Rick Perry. Both are potential recipients of conservative backing in the effort to oppose Romney.

    Trying to tap into populist sentiment, Gingrich and Perry accused Romney of being a fat-cat venture capitalist during his days running the private equity firm Bain Capital, saying he laid off workers as he restructured companies and filled his own pockets.

    That strategy boomeranged. A long list of conservative leaders who have not endorsed Romney are nonetheless sticking up for his success — former Bush adviser Karl Rove, former presidential candidate Mike Huckabee, the U.S. Chamber of Commerce, the Club for Growth, an array of conservative talk show hosts and even Santorum. Conservative leaders say the attack amounts to an assault on capitalism and the free market system at the heart of their movement.

    "It's a sad day in South Carolina and across this country if Republicans are talking against the free market, let me tell you that," said South Carolina Gov. Nikki Haley, a tea party star who has endorsed Romney.

    "It's just been foolish," said Thomas Donohue, president of the U.S. Chamber of Commerce, which does not endorse presidential candidates. "They're not doing anything other than setting up the ad base for their (Democratic) opponents."

    On that point, the anti-Romney conservatives agree.

    "I've not talked to many conservatives that support these attacks on Romney," said Family Research Council President Tony Perkins. Evangelicals, he pointed out, support a free market with moral restraints and generally wouldn't object to Romney's success at Bain. "I don't think they see that as the real issue. It sounds more like something the Democrats might bring up."

    It's a stark turnabout from last week, when speculation crackled through conservative ranks over whether Santorum could capture support from the large chunk of Republicans who aren't behind Romney.

    Post-Iowa, things went sour for this group. Romney's second-in-a-row win in New Hampshire on Tuesday solidified his standing atop the GOP field. He was followed in that race not by Santorum but Texas Rep. Ron Paul and former Utah Gov. Jon Huntsman. Gingrich and Perry also drew only tepid support in the opening contests.

    Now, everyone's looking to South Carolina's Jan. 21 primary as potentially the last stand for the anti-Romney crowd.

    "He is not anything near conservative enough," said Rock Hill, S.C., resident Carlene Madison, 54, shaking her head and making an unpleasant face.

    Polling shows Romney gaining ground in South Carolina. He won Iowa with only 25 percent of the vote and New Hampshire with a more robust 38 percent. A poll conducted Jan. 4-5 by CNN/Time/ORC International showed Romney with the support of 37 percent of the state's likely Republican primary voters, up from 20 percent a month earlier.

    He also won the endorsement this week of former U.N. Ambassador John Bolton, a favorite of conservatives for his consistent criticism of President Barack Obama's foreign policy.

    Romney has a difficult history with South Carolina's Republican voters, who are some of the nation's most conservative. In exit polling from the state's 2008 Republican presidential contest, 60 percent of primary voters said they were born-again Christians. Romney, whose Mormon faith is not considered a Christian denomination by some, carried just 11 percent of their votes, fewer than his 15 percent tally overall. Mormons consider themselves Christians.

    Conservatives looking to back someone else have a heavy workload in a compressed period of time. Romney's closest rival, Santorum, is 18 points behind in South Carolina, followed by Gingrich, Paul, Perry and Huntsman, according to the CNN/Time/ORC International poll. Six percent are undecided, the survey found.

    Jeffress, the Baptist minister, who once called the Church of Jesus Christ of Latter-day Saints a cult and doesn't consider it a Christian faith, said he is skipping the Texas conference of conservatives but might eventually recommend voting for the former Massachusetts governor.

    His rationale: "It's probably better to embrace a non-Christian like Romney, who embraces biblical values like the sanctity of life and the sanctity of marriage, rather than a professing Christian like President Obama, who embraces unbiblical positions."

  • Guess who's raising money for Romney: Bigwigs from private equity firms

    Republican heavy-hitters are calling for an end to fierce attacks centered on GOP presidential frontrunner Mitt Romney's career as a venture capitalist. NBC's Peter Alexander reports.

    Mitt Romney faces continued criticism over his refusal so far to release the names of his campaign “bundlers” -- the big money fundraisers who have helped him rake in tens of million dollars for his presidential race. 

    But two invitations to Romney private fundraisers, obtained by NBC News, reveal where many of them come from: big private equity firms.


    It's the same corporate buyout industry where Romney, as chief of Bain Capital, made his personal fortune and which, in recent days, has become a campaign lightning rod.

    Steve Schwarzman, co-chairman of the  Blackstone Group, the biggest of all Wall Street private equity firms, is listed as the “event co-chair” at both Romney events, including one tonight in Palm Beach, FL that is expected to bring in over $1 million.
     
    The invite for the event -- at the home of Miami Dolphins owner Steve Ross -- states that event co-chairs are responsible for raising at least $50,000 a piece. (Other co-chairs include billionaire financier and Home Depot founder Ken Langone, sugar baron Pepe Fanjul, and energy executive Bill Koch, whose two brothers head  Koch Industries.)  

    Schwarzman, whose firm has partnered with Bain Capital on deals since the 1980s, was dubbed by Fortune in a 2007 cover story as “The New King of Wall Street.” He also kicked off a firestorm two years ago, when he compared the battle over President Obama’s proposal to increase the tax rate paid by private equity partners to a “war” like “when Hitler invaded Poland in 1939.” (Schwarzman later apologized for what he called “an inappropriate analogy.” )

    NBC's David Gregory talks to TODAY's Matt Lauer about whether fierce attacks on Republican presidential frontrunner Mitt Romney will backfire against his rivals or stop what seems to be Romney's inevitable march to the nomination.

    But he is hardly the only Wall Street private equity baron that is bringing in large sums of cash for Romney’s campaign.  

    The invitation for another Romney campaign fundraiser -- slated for next Tuesday at New York’s Sheraton Hotel, and which a source tells NBC News is expected to bring in about $1.5 million -- lists Schwarzman and 23 others as “event co-chairs,” according to a copy the invite.

    Of that total, 16 are from Wall Street private equity and venture capital firms, either as top executives, their lawyers, or lobbyists. 

    Among them:  Wayne Berman, the Washington super-lobbyist (and Romney national finance co-chair) whose clients include Schwarzman’s Blackstone Group; Alex Navab, a top partner of KKR, another private equity powerhouse and the co-chief of its North American Private Equity portfolio; and Anthony Scaramucci, aka “The Mooch,” and chief of the Skybridge Partners hedge fund.

    The invite also lists another 125 “event co-hosts” -- many of them also from Wall Street, including one notable name: Ed Conard, the former Bain Capital partner of Romney’s who attracted attention last summer after NBC News revealed a mysterious one million dollar donation to the Romney Super PAC that came from a Delaware limited partnership that was set up shortly before the donation was made -- and then shut down.
     
    After a storm of criticism, and calls for a Justice Department investigation, Conard revealed himself to be the source of the donation.

    The Romney campaign did not respond to an email request Thursday asking whether it intended to fully disclose the names of its bundlers. But in an email exchange over the subject last summer, Andrea Saul, a spokeswoman for the campaign said: “We disclose all of the information about our donors as required by law and anyone who is interested can review it publicly. And, anyone wishing to donate to our campaign can do so at www.mittromney.com.”

  • Justice Dept. memo justifies Obama's recess appointments

     

    The Justice Department concluded in a Jan. 6 memo to the White House counsel that the Senate's "pro forma" sessions don't actually interrupt a congressional recess.

    Because they don't, the president was entitled to exercise his constitutional power to make recess appointments, the department concluded.

    President Obama used that authority last week to name Richard Cordray director of the newly formed Consumer Financial Protection Bureau. He also made additional recess appointments to the National Labor Relations Board.

    "The Senate could remove the basis for the president's exercise of his recess appointment authority by remaining continuously in session and being available to receive and act on nominations, but it cannot do so by providing for pro forma sessions at which no business is to be conducted," says a memo from DOJ's Office of Legal Counsel.

    The memo was released today in response to calls for a fuller explanation of the legal basis on which the White House acted.

    The question, the Justice Department says, is a practical one: During these pro forma sessions, is the Senate actually able to provide advice and consent to nominations?  Obviously not, the memo says, which makes them a "recess" in name only, and not in substance.

    Even so, it says, "the question is a novel one, and the substantial arguments on each side create some litigation risk for such appointments."

  • Perry backs off 'vulture' attack on Romney and Bain

     

    BLYTHEWOOD, SC -- The vulture flies no more.

    Gov. Rick Perry's address to about 40 diners at famed Southern cookin' joint Lizards Thicket Thursday offered a healthy helping of anti-Obama rhetoric with a side of swipes at the "insiders" who are running for the presidency.

    But his least appetizing metaphor for Mitt Romney -- one in which he graphically compared Romney's former company Bain Capital to a vulture picking at the carcasses of damaged companies -- had vanished from his speech.

    The Texas governor first unveiled the "vulture capitalism" term on Tuesday, echoing a similar line of attack to Newt Gingrich has used against the former Massachusetts governor.

    Perry used the term three times in one speech yesterday but then appeared to abruptly drop it during later campaign stops.

    The wave of Bain attacks has subsided as conservative commentators ripped Perry for being "anti-free-market" and providing fodder for Democratic critics of Romney, should the presumed frontrunner become the GOP's nominee.

    In Blythewood, he began a sentence that sounded like a possible wind-up to a defense against those pundits.

    "I'm a capitalist and I believe in the profit motive, but there is a point in time where we have to say 'Wait a minute, what is going on here?'" he began.

    But instead of launching into the story of workers in Gaffney, SC laid off at the hands of Bain -- a staple for the last few days in South Carolina -- he dinged the US Treasury for its cozy relationships with Wall Street banks, a months-old critique.

    Perry's tempered criticism comes against the backdrop of a defection by a top Perry backer, Barry Wynn, to Romney's campaign. Wynn told the Associated Press that the Texas governor's recent attacks on Romney's record at Bain had spurred his decision to switch sides in the primary.

    Asked about the "vulture" capitalism swipe on a Fox News interview Thursday, Perry did not disavow the attack outright but implied that his examination of Bain's record could help voters determine if Romney is a "flawed candidate" before the general election.

    "The fact is, this process is about winnowing out individuals and testing whether or not they're a flawed candidate or not," he said. "And I will tell you when people can point to where you made a quick profit and kicked people out of their jobs, that is an issue that has got to be addressed."

  • Study examines Mormon-evangelical divide

    MSNBC's Thomas Roberts talks to Democratic strategist Julian Epstein and MSNBC's Joe Watkins about new poll numbers that lend insight to fellow Mormons' perception of Mitt Romney as a candidate, the politics of the Mormonism, and how the religion itself shaping debate on the campaign trail.

    A study out Thursday takes another look at the uneasy relationship between Mormons and evangelical Christians, a timely issue as Mitt Romney, a member of the Church of Jesus Christ of Latter-day Saints, seeks to wrap up the Republican presidential nomination next week in heavily evangelical South Carolina.

    The report, by the Forum on Religion & Public Life of the Pew Research Center, says Mormons and white evangelicals share strong beliefs in prayer, the Bible and conservative politics but disagree sharply over theology. About half of Mormons in the survey said they felt hostility from evangelicals.

    The Associated Press has a breakdown of the data here.

    The report is generally consistent with several that have been undertaken in the last few years, most recently a survey in October of Protestant ministers, 75 percent of whom disagreed with the statement, "I personally believe Mormons (Church of Jesus Christ of Latter-Day Saints) to be Christians." Sixty percent said they "strongly disagreed."

    The survey found that evangelical ministers were more likely to "strongly disagree" that Mormons are Christians than were mainline Protestant ministers.

    In a look at the issue in the context of Romney's campaign, Philip Roberts, president of Midwestern Baptist Theological Seminary, a leading Southern Baptist institution in Kansas City, Mo., told msnbc.com that the evangelical distinction was drawn over much more than differences of opinion that developed a millennium after the crucifixion of Jesus:

    The LDS Church "radically reconstructs the historic Christian doctrines on God, Jesus and salvation," said Roberts, the author of "The Counterfeit Gospel of Mormonism" and for many years a senior leader of the Southern Baptist Convention, the nation's second-largest denomination.

    "I think evangelicals look at Mormons as basically having a belief in God and the 10 Commandments, and Mormons are generally known to be morally traditional and to confirm much of the Judeo-Christian ethic," Roberts said in an interview. ... 

    But "they deny the confessions of the church," he said, referring to a series of statements of fundamental Protestant beliefs about salvation over the centuries.

    Read the full msnbc.com story: Romney campaign puts Mormon faith in spotlight

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