Labor Largesse Key to Obama’s 2012 Hopes; S&P Boss Downgraded; Immigration Activists Get Hip to Amnesty Rules

Obama Leans Harder on Labor as His Fortunes Fall

“The essential idea is that changes in the law for the first time really allow the labor movement to speak directly to workers, whether they have collective bargaining agreements or not.’’

-- AFL-CIO Political Director Michael Podhorzer talking to the Associated Press about a planned labor Super PAC that would seek to elect Democrats and expand union membership.

In the past two election cycles, American labor unions have spent some $600 million helping elect and protect Democrats, most of it devoted to President Obama’s 2008 election.

But it may take an even larger commitment from labor groups to keep Obama in office. The latest Gallup poll shows Obama would be hard pressed to beat either of the GOP frontrunners, Mitt Romney or Rick Perry, or even those farther back in the pack, like Ron Paul. The cry from independents has become: Anybody but Obama.

The president is in the midst of a political crisis. While he has 15 months to stage a comeback, the weakening economy and Obama’s inability to connect with American voters on the issues that matter most have banished ideas about an easy re-election.

Unions are already gearing up for the struggle. The AFL-CIO is preparing to launch a huge new Super PAC that can use new campaign finance laws to raise unlimited donations and spend unlimited sums. The union sees this as a way not only to help keep Democrats in power but also reverse their declining membership numbers. It would be political action and organizing in one package.

Most importantly for the president, the money could be shifted quickly to different states or efforts depending on where the incumbent is in the most trouble: drop $10 million in Florida one week and then shift to Nevada the next. This would be a financial fire hose that could be quickly turned to douse the greatest threats to Obama’s re-election

Democrats are more important to Unions now than ever. Labor groups previously primarily relied on sympathetic politicians to help them with favorable rules for organizing private workplaces. But as private-sector union membership has collapsed in recent years, groups like the AFL-CIO have become increasingly dependent on government workers and their dues.

As much as union leaders may like to pound the podium over a lack of action by the Obama Democrats, the truth is that given the reversals seen for government worker unions on the state level, a Republican presidential administration would be a disaster for big labor right now.

It comes as no surprise then that Obama has agreed to be the headline speaker at the massive union conclave in Detroit on Labor Day. This will be part of the president’s new jobs program rollout, but it will also be his chance to remind unions what he has done for them.

Aside from an aggressive agenda at the National Labor Relations Board that is easing organization efforts for unions and punishing companies that seek to expand non-union operations, labor groups can also thank the president for awarding them part ownership of post-bankruptcy General Motors and Chrysler. Detroit was the heart of the industrial-era American labor movement and now the greatest example of the symbiosis between the remnants of that movement and the Democratic Party.

Unions have lost a great deal of their clout when it comes to the ballot box. Not only are they smaller in size, but members frequently stay home on Election Day or even violate union instructions on how to vote. But one of the advantages of being more dependent on government workers is that dues payments are steady.

That money will soon be pouring forth for the president and in a bid to keep the movement alive.

S&P Boss Gets Career Downgrade After Calling out Feds on Debt

“I think S&P has shown really terrible judgment and they’ve handled themselves poorly, and they have shown a stunning lack of knowledge about basic U.S. fiscal budget math, and I think they came to exactly the wrong conclusion.”

-- Treasury Secretary Tim Geithner on MSNBC on Aug. 6 discussing the downgrade of the debt offered by his department.

Outgoing Standard & Poor’s boss Deven Sharma has learned a valuable lesson about American society: nobody likes a snitch.

Sharma’s firm has tried to salvage its reputation after overestimating the safety of mortgage-backed securities during the inflation of the housing bubble. Those high ratings, which were financed by the folks selling the investments, helped spread the subprime contagion around the globe as profit-hungry portfolio managers brandished AAA ratings to defend investments that otherwise would have been seen as far too risky for government pension funds and the like.

The firm has since sought to reform its practices, changing the way it charges for its ratings and imposing more stringent standards, but the firm’s once-platinum reputation was badly tarnished.

Perhaps that was why the firm decided to say the thing that everyone in the financial world knows: the U.S. is on an unsustainable debt binge.The nation's annual budget deficit more than tripled from $458 billion in 2008 to $1.4 trillion in 2009. There is no apparent pathway to a political reconciliation on the issue, which is now equal in size to the entire U.S. economy.

The other ratings firms have all issued gloomy warnings and threatened downgrades, but S&P, the biggest fish in that pond, opted to do the previously unthinkable and strip the federal government of its AAA rating. August 5, 2011 goes down in the books as the big downgrade.

Since then, we’ve heard about Justice Department investigations into the firm’s practices and seen S&P denounced by cabinet officials. On Capitol Hill, lawmakers have called for inquests and hearings. And with new regulations on credit raters being crafted in Washington, this was no time for S&P to start being a bunch of bold truth tellers.

If private ratings firms were allegedly swayed by the big money to be made offering juicy evaluations for risky picks, why wouldn’t they also be swayed by the threat of regulatory retaliation?

Immigration Activists Celebrate Obama Amnesty Order

“The administration’s announcement also had an immediate impact on a case in Denver, where an immigration judge on Friday postponed the deportation of Sujey Pando, a lesbian from Mexico legally married in Iowa to an American from Colorado, Violeta Pando. Although federal law does not recognize same-sex marriages, administration officials said they would consider same-sex spouses as ‘family’ in their review of deportation cases.”

-- Passage from New York Times article “U.S. Issues New Deportation Policy’s First Reprieves.”

Proponents of amnesty for illegal immigrants are cheering the move by the Obama administration to explicitly shield preferred illegals from deportation.

Immigration and Customs Enforcement officials have always prioritized deportation cases, giving first priority to bad actors and shuffling downward those who are otherwise abiding by American laws.

The administration has defended the move on the grounds that they have to focus on violent offenders and dangerous criminals. But that’s what the existing rules did. The new policy now in place doesn’t focus on kicking out the bad guys, but instead setting the criteria for which illegals are to be left alone. While the DREAM Act would have provided amnesty for those here illegally who are enrolled in college or serving in the military, the new rules are in many ways broader.

Illegal immigrants who are part of same-sex couples, relatives of citizens, students and many others have been exempted from deportation. Most of these folks wouldn’t have been deported before (Power Play observes that illegals who lead marches and give interviews to the New York Times must have had little fear of deportation to begin with) but now they have a explicit amnesty.

The White House, knowing the capacity for outrage at the exercise of broad executive power on such a controversial subject, rolled out the new policy in stages, revealing the final parameters on a Friday afternoon as the president was leaving town for 10 days.

But activists are starting to catch on to the scope of their victory. Republican lawmakers, too, have started to see how big a deal this is.

And Now, A Word From Charles

“As Churchill said, it's not the beginning of the end. It's the end of the beginning. It starts with getting rid of a dictator, and now the hard part. Libya is an incredibly tribal society. And now you have unexpected development. The liberators came from the west. The regime we recognize is in the east. That means there will be an ethnic division in the west are the Berbers versus Arab. There are ideological splits among recent defectors, ex-Qaddafi people, and the ones never in the regime.”

-- Charles Krauthammer on “Special Report with Bret Baier.”