Tales from the Trail

A line kept cropping up in our stories from Washington today, something along the lines of “unlikely to be passed in Congress.”

President Obama went out to Falls Church, Virginia to tout his $5 billion to $10 billion plan to help homeowners refinance. The proposal, sketched out in last week’s State of the Union address, could provide relief to many locked into high rates by their homes’ sagging value. But it doesn’t look like it will overcome Republican opposition.

Democrats also introduced today the “Paying a Fair Share Act of 2012,” longhand for the “Buffett Rule” that Obama also raised in his address last week. The idea is that millionaires would pay a minimum 30 percent effective tax rate. It has almost no chance of passage in a Republican-controlled House that has sworn off tax increases.

Sure, this kind of political theater is part of the Washington spectacle. But we thought it was best to tell readers to sit back and enjoy the show – rather than start making plans for the future.

Here are our top stories from Washington…

Obama presses Congress to step up aid for homeowners
President Barack Obama pressed lawmakers to back a $5 billion to $10 billion plan to help U.S. homeowners refinance, part of an election-year package that is unlikely to overcome Republican opposition in Congress. Obama moved to counter Republican criticisms that the proposal would use taxpayer money to bail out irresponsible borrowers by stressing that only homeowners current on their payments could benefit. The president had sketched out the plan in his State of the Union address last week.

For the past week or so, we’ve watched Democrats and Republicans playing chess on the payroll tax cuts, trying to outmaneuver each other and gain the upper hand in this final bitter budget battle of 2011. Today, it looks like the match moved off the chessboard and into the unknown.

In this vacuum, people are struggling to know what happens next. Eric Lascelles, chief economist at RBC Global Asset Management in Toronto, told us his confidence that the tax cut will be extended in 2012 “is beginning to waver.”

“As usual,” he added, “the political process is such a black box it’s hard to credibly put odds on this.”

There will be no vacation for you, Congress, until you get your work done. That was the stern message from President Obama today. But it probably wasn’t his warning that pushed Democrats and Republicans to get back to serious negotiations to finish the year’s business. More likely, it was fear of voter backlash.

For the third time this year, Americans were hearing about the threat of a government shutdown because Democrats and Republicans could not strike a deal on some basic legislation –a spending bill needed to fund many government agencies beyond Friday. After a flurry of meetings on Capitol Hill, we received word that the deal was near.

Separate negotiations on the legislation to extend a payroll tax cut and unemployment benefits also seemed to gather pace after days of distractions and setbacks. If the negotiators are successful, Congress’ work might all be done by the weekend.

No one said extending the payroll tax cut in Congress by December 31 would be a walk in the park. But did we really expect it to turn into another marathon with multiple detours?

After a rare display of bipartisanship on Monday on a spending bill to keep the government running through 2012, Tuesday gave way to another day of bitter back and forth, in which Democrats and Republicans aimed to out-maneuver and out-smart each other.

The Republicans managed to pass their payroll tax cut bill in the House with the controversial measure to speed up the decision on green-lighting the Keystone oil pipeline. It almost certainly won’t make it through the Senate and the White House made clear today that President Obama will veto it if it does. He’s decided the Keystone pipeline has to wait until after the elections and won’t be dragged into this debacle.

NBA star Shaquille O’Neal said on Monday he believes President Barack Obama is doing a ”fabulous job” and will win the 2012 presidential election.

O’Neal, who retired from pro basketball this year, joined a handful of celebrities endorsing the Democratic president, ranging from singer Lady Gaga and actor Tom Hanks to Basketball hall-of-famer Magic Johnson.

“It’s a hard job … You can’t please everybody but I think he’s doing a fabulous job,” O’Neal told CNN host Piers Morgan. ”The world is in a little bit of turmoil right now — the economy’s down — but … he’s going to pick it back up and I think he’s going to win this next election.”

As much as President Barack Obama tries to distance himself from the failure of the congressional “super committee” to make a long-term deal on cutting the deficit, a good chunk of voters may hold him at least partially responsible.

A Reuters Ipsos poll shows the blame for the failure shared fairly equally among the political parties and the president. Just over one in five respondents (22 percent) blame all three (Democratic and Republican lawmakers as well as Obama) the most — slightly more than the 19 percent who blame both parties’ lawmakers but not the president.

For 13 percent of respondents, Obama alone is blamed most, better than the 18 percent who just blame Republicans but worse than the 7 percent who blame the Democratic lawmakers alone. And while Congress suffers the most in the public’s eye, with 51 percent taking a less favorable view of Capitol Hill in the wake of the failure, Obama’s standing drops for 35 percent of those polled.

The good news? Thanksgiving will not be interrupted by eleventh-hour negotiations by the “super committee” to strike a deal to cut the burgeoning deficit. After months of work, the 11 men and one woman called it quits today. Their statement said “it will not be possible to make any bipartisan agreement.” No mention of the word on everyone’s tongues: failure.

Even in the early days of the super committee, we are learning, hope was in short supply. At one of the early breakfast meetings, members kept saying how hard it would be to reach agreement. South Carolina’s  Democratic Representative James Clyburn said to his fellow panel members: “Do you want to know what’s hard? Desegregating South Carolina in the 1950s. I met my wife in jail.”

Right now, it’s hard to believe this Congress “can build on this committee’s work,” as the committee co-chairs said hopefully in their statement. There seems to be little faith left on the Hill. Just look at the harsh words from Republican Senator Olympia Snowe, who said the panel’s failure “represents yet another regrettable milestone in Congress’s steady march toward abject ineffectiveness.”

As Democrats and Republicans hunkered down on opposite sides of the Capitol on Wednesday, showing no signs of a compromise on slashing the deficit, a group called the Patriotic Millionaires for Fiscal Strength made its move.

Nearly 140 members wrote a letter to President Barack Obama and the U.S. Congress to “do the right thing” and “raise our taxes.” Next they hit up the bipartisan “super committee,” laboring under a Nov. 23 deadline to reach agreement on the deficit or trigger unpalatable budget cuts.

One of the corporate patriots said if Congress ended Bush-era tax cuts it would affect him and his fellow millionaires in his group “about as much as a dead fly interrupts a picnic.”

Expectations for massive fund-raising in the 2012 election may obscure one point — big bucks don’t always lead to victory. And in fact, too much spending — especially in the form of too many advertisements — can turn off voters.

There have been several notable examples of heavy, but ultimately fruitless, outspending in recent elections.

In the 2010 midterms, Republican Meg Whitman, the billionaire former chief executive of eBay, spent $140 million of her own money, or about $43 per vote,to campaign for governor against Democrat Jerry Brown.  Brown spent $7.50 per vote to defeat her by 12 percentage points, in a race that was a rare bright spot for Democrats in elections that saw most Republicans sweep to victory.

Republican presidential hopeful Mitt Romney,  who has criticized President Barack Obama for taking a nine-day vacation at a time of high unemployment, filed for permits to almost quadruple the size of his oceanfront home in La Jolla, California.

The former Massachusetts governor and his wife bought the house three years ago for $12 million. They want to knock down the one-story, 3,009-square-foot home overlooking the Pacific Ocean and replace it with an 11,062-square foot place in its stead, according to the San Diego Union Tribune.

Romney says he needs a bigger place to have room for his five sons, their wives and his 16 grandchildren. The Union Tribune said the plans would keep the house’s existing pool and spa.