Tea Party candidates make gains in this week’s Republican primaries. Some Congressional Democrats split with President Obama over ending tax cuts for high earners. And retail sales are stronger than expected. A panel of journalists joins Diane for analysis of the week’s top national news stories.

Guests

  • Jake Tapper ABC News senior White House correspondent.
  • Juan Williams NPR news analyst, FOX News political analyst, and author of "Enough."
  • Ruth Marcus columnist and editorial writer, The Washington Post.

News Roundup Video

The panelists discuss a controversial article by Dinesh D’Souza published earlier this week by Forbes magazine in which the author calls President Obama “the most anti-business president in a generation” and alleges that the president “adopted the cause of anti-colonialism” from his Kenyan father, who left the family when Obama was 2 years old. White House press secretary Robert Gibbs has said the article “represents a new low” and is “lacking in truth and fact:”

The panelists discuss President Obama’s appointment of Elizabeth Warren to a special advisory role in creating the new Consumer Financial Protection Bureau:

Transcript

  • 10:06:55

    MS. DIANE REHMThanks for joining us. I'm Diane Rehm. Poverty reaches record levels in the U.S., the Senate approves President Obama's small business measure, and Republicans rethink their midterm election strategy amid strong Tea Party primary wins. Joining me for the domestic hour of the Friday news roundup, Jake Tapper of ABC News, Ruth Marcus of The Washington Post and Juan Williams of NPR and Fox News. Do join us, 800-433-8850. Send us your e-mail to drshow@wamu.org. Join us on Facebook or send us a tweet. Happy Friday, everybody.

  • 10:07:49

    MS. RUTH MARCUSHappy Friday.

  • 10:07:49

    MR. JAKE TAPPERGood to see you.

  • 10:07:49

    MR. JUAN WILLIAMSHappy Friday.

  • 10:07:50

    REHMRuth Marcus, what do you make of this new poverty report?

  • 10:07:55

    MARCUSIt's depressing. It's sad, and it could have been worse. The really remarkable thing is the degree -- in some sense, the numbers were surprising because people had been braced for worse. And one thing that I really thought was striking about the numbers is that if we had not had an increase in an extension in unemployment insurance, there would have been 3.3 million people more in poverty. So the good news, to the extent that there is some, is that we do have actually a functioning, at least somewhat, social safety net here in the United States. And it's a reminder of how important that is.

  • 10:08:40

    REHMJake Tapper, is this going to affect the argument that we need these kinds of support programs by the government?

  • 10:08:52

    TAPPERI believe it will. I don't think that there is anything unexpected in this, obviously though, because of the economic downturn. One of the things I found most remarkable is the number of people who are not considered to be in poverty. The figure -- what is it, something like -- it's just over $10,000.

  • 10:09:09

    REHMNo.

  • 10:09:09

    MARCUSIt's -- I think it's $22,000 for a family.

  • 10:09:10

    REHMTwenty-two for a family.

  • 10:09:12

    TAPPERFor a family...

  • 10:09:13

    MARCUSOf four.

  • 10:09:13

    TAPPER...and $10,000 for an individual. But what is...

  • 10:09:15

    MARCUSWho can live on that?

  • 10:09:15

    TAPPERExactly. What is not considered poor in this country is just remarkable 'cause you can't really afford to do much of anything when you're above the poverty line, just above the poverty line.

  • 10:09:28

    REHMJuan Williams, does this have any implications for the midterms?

  • 10:09:34

    WILLIAMSWell, I was surprised to hear Jake say that he thought it would change the way that people are thinking about, for example, stimulus spending or some of the social safety net programs because stimulus has become a bad word in the political lexicon of the moment.

  • 10:09:51

    TAPPERWell, I didn't mean stimulus. I just meant more like the unemployment insurance.

  • 10:09:55

    WILLIAMSYeah...

  • 10:09:55

    TAPPERI agree with you.

  • 10:09:56

    WILLIAMSExtended unemployment, but even that is subject to some controversy...

  • 10:09:59

    REHMYeah, you bet.

  • 10:10:00

    WILLIAMS...at the moment because people say that it may be a disincentive for people to go out and get work. But this is a moment when you just look at the numbers and you -- I mean, you have to be appalled. There has to be a sense of compassion. One in five American children living in poverty, it's unbelievable to me. And when you look at the numbers in terms of racial breakdown, you know, the overall percentage is now 14 something. But it's about 9 percent of white people living in poverty. And then you jump up, and it's 25 -- in fact, 25 percent plus among blacks, 25 percent among Hispanics. That's pretty high percentages. And again, the thing that just, you know, makes you want to cry is when you look at the children in poverty because, again, if you look at minority children, it's just astronomical.

  • 10:10:45

    REHMI think ABC was following a young man who -- whose family went from bad to worse. And he was saying, it's good to go to school because I can get some food there. Jake?

  • 10:11:04

    TAPPERYeah, and in fact, David Muir, the correspondent who was following this family, we checked in with him yesterday. And the young man has entered the military. It is a solution for a lot of these people who have nowhere else to go...

  • 10:11:17

    REHMBut, of course, that left behind his little brother...

  • 10:11:20

    TAPPERRight.

  • 10:11:21

    REHM...and the family, who have no income at this point. I mean, there are stories all over the place. There's a front page story on the second section of The Washington Post this morning about a family whose both children are ill, and he is losing his home even though both parents are still working, retired from the Air Force and not able to make it.

  • 10:11:53

    MARCUSIt made me cry this morning. And I think that Jake makes a very important point, which is we -- the poverty measure is imperfect. Everybody acknowledges it's imperfect. It's just an illustration of how bad things are. I went last night to watch focus groups of so-called Wal-Mart moms. Mothers -- these were mothers who shop at Wal-Mart. They were not particularly strongly identified with either political party. They were split pretty evenly between McCain voters and Obama voters. They were in Pennsylvania, in Colorado and in Missouri. And one of the things that was striking about them was how many of them had personally experienced really destabilizing events in their lives. I'm living with my mother. My husband lost his job. My husband hasn't been able to find a job for two years. It was really remarkable. And the poverty figures are just the worst of the worst, but it doesn't mean everybody else is in good shape.

  • 10:12:54

    WILLIAMSAnd I would add that, you know, on a very ordinary level -- not quite as dramatic as that -- is the number of people, now, who are moving in with other people. According to what we hear from census statistics or see in census statistics, a tremendous jump in people who are encountering poverty who then move in with somebody, like a relative, like a mom. And so what you have is multi-family households now increasing. I think it's double digits, about 11 percent over the last year.

  • 10:13:20

    REHMYou know, there was one story about a for-adults-only city out in the Midwest where you found exactly that happening. And the other residents were protesting because it's supposed to be an adults-only residential area.

  • 10:13:41

    WILLIAMSYou know, the other thing that stood out to me was that according to the statistics, the people who have it the worst in this country are people who don't have a college education, people who are -- have had children when they are teenagers and people who have lost contact with the job market, meaning that they have stayed away from having a job, you know, because they don't want to take a low-level job and therefore they've been out of the job market for a long period of time. Those people are the ones who are most likely to be in poverty in America.

  • 10:14:10

    REHMNow, there is also this 50 million more without health insurance, and what President Obama's critics are saying is, see, that ObamaCare doesn't work at all, when in fact, I gather ObamaCare doesn't even kick in for three years.

  • 10:14:32

    MARCUSIt doesn't kick in, and you can take those numbers and say -- and make any argument that you want. But I think the better argument is, look, if we don't get rising healthcare costs under control, it's going to be unsustainable for private employers to continue to offer health insurance. It's going to be increasingly unaffordable for workers to kick in their share. There are flaws and limitations in the healthcare plan, but the status quo, unsustainable.

  • 10:15:04

    REHMSo can the government do anything more right now about this increasing poverty level? Jake.

  • 10:15:14

    TAPPERWell, if I had to answer that question, I probably would be, you know...

  • 10:15:17

    REHMIn government.

  • 10:15:18

    MARCUSSave us, Jake.

  • 10:15:19

    TAPPERI do, you know, I think that this is the -- there is a political reality that the White House is dealing with, in terms of what they would do if they could do anything without having to worry about Congress and what they can do with Congress -- with Congress going through what even Democratic leaders on the Hill call spending fatigue in an election season. And because there is this disconnect, the White House is put in a spot where they almost have to argue that there isn't anything more that can be done other than the smallbore programs that they are talking about: the small business lending initiative that passed this week, some of the other tax cuts for -- tax credits for small business that they want to push. Because to admit that what we would like to do is a $500 billion stimulus package -- but we can't get it through Congress -- to admit that...

  • 10:16:18

    REHMAnd we surely can't call it that.

  • 10:16:20

    TAPPERRight or whatever you want to call it. But to admit that is to admit impotence, is to admit that in your second year with a Democratic Senate and a Democratic House, you can't do what you need to do. So they refuse to admit that.

  • 10:16:34

    WILLIAMSYou know, I think that Jake is right on it, on the money. But I want to come back to what you were talking about, Diane, which is, what impact does this have on the midterm elections that are upcoming? And my sense is -- maybe I'm just a pessimist. But I just don't anticipate that it'll be much, that much of the rage that we have seen, the energy coming from people -- like, the Tea Party folks. I think they're mad at deficit spending, so they're not willing to spend as Jake was describing, on any additional programs. They would see it as, you know, wasteful, possibly.

  • 10:17:02

    TAPPERExcept for tax cuts.

  • 10:17:03

    WILLIAMSRight. But they don't want to pay for the tax cuts.

  • 10:17:07

    TAPPERNobody wants to pay for the tax cuts.

  • 10:17:08

    WILLIAMSWell, but you got to pay for tax cuts. They're not free.

  • 10:17:10

    TAPPERThe president doesn't want to pay...

  • 10:17:11

    WILLIAMSWell, okay. But that's not even...

  • 10:17:12

    MARCUSWho wants to pay for less?

  • 10:17:12

    WILLIAMS...that's not for the poor. It's not for the poor. I mean, you're talking about...

  • 10:17:15

    TAPPERRight.

  • 10:17:16

    WILLIAMS...tax cuts for the very rich. And then secondly, if you're talking about things like stimulus spending, as I said before, people are still down on it, still highly critical even as their -- we see the banks and others now testifying openly saying, yes, thank goodness we were bailed out, and others saying, without stimulus spending, the unemployment rate might be 16 percent.

  • 10:17:35

    MARCUSThe disconnect between the reality, the stimulus might not have been big enough. It might not have been targeted enough in the right ways, but it helped hugely. The disconnect between that and the popular perception, which is it links it in to bank bailouts, which A, also helped and B, are ending up not costing very much money. But there's huge, huge anger at this focus group I was at. Why did they bail out the banks, and they didn't do anything for us? They spend all this money, and it didn’t do anything. I care about the deficit, but I really need those -- I really need those tax cuts extended for everybody. It is not -- we're not dealing with a particularly -- I hate to say it this bluntly -- rational electorate in 2010.

  • 10:18:20

    REHMReally?

  • 10:18:21

    MARCUSReally.

  • 10:18:23

    REHMRuth Marcus.

  • 10:18:24

    MARCUSSend the e-mails.

  • 10:18:25

    REHMRuth Marcus, she is columnist and editorial writer for The Washington Post. Juan Williams is with NPR News and a Fox News analyst. Jake Tapper is ABC News senior White House correspondent. We'll take a short break. We'll talk about the mixed economic news when we come back.

  • 10:20:02

    REHMAnd our first e-mail is on the very subject I hope to bring up next. Kim in Manchester, N.Y., says, "Record levels of poverty. Republicans and more Democrats want to extend Bush tax cuts for the 250,000-plus incomes. Please tell listeners if you think there's something wrong with this picture?" Juan.

  • 10:20:34

    WILLIAMSWell, yes. There -- it's an odd picture in that if you look at it, what you're talking about, people who make more than 250 being about 1.9 percent of the population. The argument would be from people who are proponents of this, Diane, that those are people who hire. They are directly connected to small businesses in many cases and that at this time of economic uncertainty, what we're doing by not extending the tax cuts for the very rich is actually increasing anxiety among people who are in position to do hiring. And that's why if you look at the -- this is really spinning off now. That's why so many big companies are sitting on large caches of money and reluctant to hire. The contrary argument would be, wait a second, economists have said. In fact, giving the tax breaks to those folks, one, highly increases the size of the deficit. And two, it's not stimulative in terms of hiring, that most small business owners do not make more than $250,000 a year.

  • 10:21:41

    MARCUSThe small business argument is -- I think the technical economic term for this is -- it's a crock. Okay? It's 2 percent -- 2 or 3 percent of small businesses earn that much. The counter-argument you hear is, okay, but that accounts for 50 percent of small business income, except that it's not what we think of when we think of as the Mom & Pop drycleaner down the street or even the entrepreneurial next Steve Jobs in his garage. It's investment bankers and lawyers who are reporting on their tax forms investment income that looks like small business income. That's all thrown in there. And so if you wanted to do something effectively with stimulus, you would take the $35 billion it would cost over the next couple of years. And you would spend that a better way. And if you truly cared about the deficit, you certainly would not take $700 billion and extend those upper-income tax cuts.

  • 10:22:37

    REHMJake.

  • 10:22:37

    TAPPERThere are a few interesting arguments here. I obviously don't have a position on the tax cuts. But, one, it has been argued that allowing these tax cuts to expire is an anti-stimulus. Instead of injecting $787 billion into the economy, you are withdrawing up to $4 trillion from the economy over the next 10 years. So that's what -- that's one argument. Two, I interviewed Congressman Gerry Connolly, a Democrat from Virginia who appeared with the president earlier this week. And he has a lot of people in his district who earn above $200,000 per individual, $250,000 for families, or a lot of people who will be hit by these Bush tax cuts expiring are the wealthiest Americans.

  • 10:23:18

    TAPPERBut he said -- his argument is they should be extended because, A, you don't raise taxes during a recession, and, B, 5 percent of consumers -- the top 5 percent of income-earners are responsible for 30 percent of consumer spending. So it's not just an issue of hiring. It's also an issue of consumer spending. But then the other issue that I have not heard one politician talk about on the right or the left, Democrat or Republican, in the last three weeks, is this debate that's heated up is this is going to cost an incredible amount of money that is not paid for. This is not budgeted. The Bush tax cuts were not budgeted, so we're talking about...

  • 10:23:56

    REHMThey were set to expire.

  • 10:23:58

    TAPPERThey were set to expire, but we're talking about blowing a hole in the deficit or the debt of -- over the next 10 years -- of either $3 trillion if you're President Obama, or $3.7, $3.8 trillion if you're John Boehner, Mitch McConnell -- either way, they're not paid for. And this is a huge problem when it comes to the national debt, but no one is talking about it at all.

  • 10:24:22

    REHMRuth.

  • 10:24:23

    MARCUSWell, there's so many things to say about the tax cuts. One is that, let's remember how they started. The started in 2001 because we had a surplus. And President Bush told us that the American people had been overcharged by the government. We were...

  • 10:24:38

    REHMOvertaxed.

  • 10:24:39

    MARCUSAnd we had enough money to give some of that money back and continue to pay down the surplus. So those...

  • 10:24:47

    REHMPay down the debt.

  • 10:24:48

    MARCUSI'm sorry. Use the surplus -- excuse me -- to pay down the debt. Those facts are no longer true. And they didn't turn out to be true, of course, at the time. And so we never paid for any of these tax cuts. Second, Republicans, in particular, say, you don't raise taxes in the middle of a recession. That is generally a correct assessment. But the...

  • 10:25:09

    TAPPERI think President Obama said that last year, too.

  • 10:25:11

    MARCUSBut the fact of the matter is, is that their view is you don't raise taxes ever. So if we were talking about whether to extend some or all of the tax cuts for the next two years, you could actually have a reasonable discussion about whether some of them, as I think, should be extended for a few years or whether all of them should be extended for a few years. But no -- but Republicans are unwilling to say, we're going to cut it off after a few years, which is how -- and the president is unwilling to say, we're going to cut off the lower -- I don't want to say middle income because it's so many people, but the under 250 tax cuts. And so Jake's exactly right. How is it going to be paid for?

  • 10:25:49

    WILLIAMSWell, let me just say that you posit it as just Republican obstructions. But you should be aware that you have Democrats, especially conservative Democrats, in difficult races right now, who are saying, oh, yes, let's extend them. And their idea is, let's extend them for two years. Or Kent Conrad, the Democrat chairman of the Senate Finance Committee, yes, let's extend it for -- I think his is two years also. Bob Corker, a number of the Republicans now, Orrin Hatch, others are saying, yes, at least a one-year extension. So everybody is looking for a way to -- I think Lindsey Graham said extend it for three years beyond the next presidential election. Everybody is looking for a way to avoid any kind of anger coming from voters who will say, you increased my taxes.

  • 10:26:29

    REHMI thought it...

  • 10:26:29

    WILLIAMSAnd this is across party lines.

  • 10:26:31

    REHMI thought it was interesting that John Boehner said on one of the talk shows that he would be willing to compromise on this. And the next day, his party leadership slammed that idea.

  • 10:26:45

    MARCUSSlammed that, and if that didn't shut him down -- I think we haven't talked about the primary elections yet. I think Tuesday's vote really slammed down anybody who might have thought about going along with him. And, one, I just want to say, I take your point. You're exactly right. There are a number of Democrats, conservative and not-so-conservative Democrats, who are talking about extending the upper-income tax cuts for a few years. And, look, there's a reasonable -- if you thought they were going to expire, and if you believe that you're not going to get stimulus spending any place else, it's not a particularly effective use of the money. But it's maybe better than nothing.

  • 10:27:22

    WILLIAMSWell, at least you think that they're doing it as a matter of policy. I think they're doing it as a matter of politics.

  • 10:27:26

    MARCUSWell, I'm an editorial writer. I have to live in the world of policy.

  • 10:27:30

    REHMPolitics as opposed to policy. Go ahead, Jake.

  • 10:27:34

    TAPPERWell, I'm just going to say, in terms of inter-party squabbling, we have the John Boehner incident. He went out on a limb talking about how he'd be willing to vote for just the lower-income or middle-income tax cuts.

  • 10:27:45

    REHMHe said he'd be willing to compromise, yeah.

  • 10:27:46

    TAPPERIf it was put in front of him. That's not what he wanted...

  • 10:27:49

    REHMRight.

  • 10:27:49

    TAPPER...but if they put it in front of him, he would vote for it.

  • 10:27:50

    REHMExactly.

  • 10:27:51

    TAPPERAnd he went out on a limb, and he saw it off by Eric Cantor and Mitch McConnell and all the other Republicans. But maybe a week or so before, President Obama's former budget chief, Peter Orszag, wrote an op-ed for The New York Times in which he posited two things that the president disagrees with. One, this tax cut should be extended. And if they need to add the ones for the wealthy in order to get them extended, that would be a compromise that would be worth making, which the president disagrees with. And it might explain why Peter Orszag is now his former budget chief, not his current budget chief. And then, two, all of them, all of the tax cuts, need to expire in two years because it is fiscally unsustainable. And that is another position that President Obama refuses -- or won't make because he says that middle class individuals have seen their real wages go down. And he's not -- he wants them in perpetuity. He wants them forever.

  • 10:28:45

    REHMSo in the meantime, we get this mixed economic news this week that retail sales are up perhaps because of back-to-school spending, but home foreclosures are also up. Ruth.

  • 10:29:01

    MARCUSAnd because we still haven't gotten a situation where banks are feeling particularly comfortable lending, they got slammed for having standards that are too lax. And so people who might be willing to buy, or people who are in -- like, the folks you were talking about, who were on the front page of the Post Metro Section this morning, are not getting the flexibility that they need. I did want to say one thing more about the tax cuts if you don't mind going back to it.

  • 10:29:33

    REHMGo ahead.

  • 10:29:35

    MARCUSMy prediction, we are not going to have a resolution of what happens with the extension of the tax cuts before the election.

  • 10:29:43

    WILLIAMSBut let me just say that this is a terrific issue for the Democrats. I think that President Obama and the White House have decided that this is a way to say to the American people that we are more populist, we're on the side of the little guy, and that the Republicans are obstructionists. And they are blocking a tax cut for you, the average person who makes less than 250. I think John Boehner and Newt Gingrich, on the Sunday talk shows, fell into a trap when they said, yeah, we'll consider that. Because then, immediately, Mitch McConnell, the Republican leader in the Senate and others, as you're gesturing, smacked them around.

  • 10:30:19

    WILLIAMSI mean, they somehow had broken with the orthodoxy on the Republican position vis-à-vis tax cuts. And I think it's to the benefit of what we see as a Democratic strategy emerging for the fall which is, we're going to be aggressive on things like immigration, tax cuts. And we're going to hope that it demonstrates to the voter, who's on the side of the average guy in America, and try to put the Republican narrative -- which has been that Democrats are big spenders, and they've been out of touch and not focusing on jobs -- try to really obscure that narrative which has dominated the political season thus far.

  • 10:30:53

    REHMAll right. Let's talk about the impact of the Tea Party wins for the midterms, especially in Delaware, Jake.

  • 10:31:02

    TAPPERWell, it's a huge issue. I grew up in Philadelphia, which is, you know, right next door. And so basically -- so I've known of Mike Castle for most of my adult life. And he is a huge figure in the state and a moderate congressman. He was governor for two terms and then ran for Congress, and he's been there since '92, a moderate to liberal Republican. And he absolutely would have won, and now that seat is in play...

  • 10:31:35

    REHMHe would have won against the Democrat candidate in the general...

  • 10:31:36

    TAPPERAgainst Chris Coons. Yeah, I'm sorry. In the general election against the Democratic county executive, he would have won.

  • 10:31:40

    REHMYeah...

  • 10:31:41

    TAPPERHe was highly favored to win, very popular. He'd run statewide, but Delaware only has one member of the House. So he'd been winning statewide for -- literally, for decades. Now, the seat is in play, and several prognosticators say that Christine O'Donnell, the Republican nominee, has no chance of winning.

  • 10:32:05

    REHMWhat do we know about her?

  • 10:32:07

    MARCUSOh, everything we've learned about her is more fun at every moment. I -- on election night, I was watching the video of her arguing that a correct program of abstinence included abstaining from masturbation. And she's -- look, she's got financial problems. She's got credibility problems in terms of whether she was honest on her resume, about whether she was a college graduate. She is a -- you don't have to take it from me -- but she's an incredibly flawed candidate. Take it from Karl Rove.

  • 10:32:40

    REHMWho called her nutty.

  • 10:32:42

    MARCUSAnd unelectable. But I think the more important point is not whether she is going to win or lose this election. She will, I think, almost certainly lose it. That very well could make a difference between a Republican-controlled Senate and maintaining Democratic control. But I think the bigger point is, look, what does this say to other Republicans? Beware of the Tea Party. Don't compromise with Democrats. If you are a Mike Castle-type, you are in there at your peril. Go to the right. That's bad news.

  • 10:33:18

    REHMRuth Marcus of The Washington Post. You're listening to "The Diane Rehm Show." Has the leadership lost control of the Republican Party, Juan?

  • 10:33:32

    WILLIAMSWell, there's a civil war within the Republican Party over the direction of the party. I think the Mike Castle situation in Delaware just demonstrated this writ large. They endorsed Mike Castle. They put money behind Mike Castle. They ran ads for Mike Castle. And then once Christine O'Donnell had won, had refused to endorse her, so...

  • 10:33:54

    REHMBut, now...

  • 10:33:55

    WILLIAMSWell, now that -- now, you get...

  • 10:33:55

    REHM...some figures are coming forward for money.

  • 10:33:57

    WILLIAMSWell, now, you know, Mitch McConnell and others are saying, yeah, we're going to put some money into it. They're not declaring that they'll put...

  • 10:34:04

    REHMJohn Cornyn gave her $42,000.

  • 10:34:05

    WILLIAMSRight.

  • 10:34:06

    REHMMitt Romney kicked in five.

  • 10:34:08

    WILLIAMSRight. Well, you know what? We'll see how it goes. But for the moment, I think that is to save face.

  • 10:34:13

    TAPPERCastle won't endorse her.

  • 10:34:14

    WILLIAMSNo.

  • 10:34:14

    TAPPERCastle has said because of what he says -- I think he told The Washington Post -- he referred to the personal smears against her.

  • 10:34:21

    REHMOkay.

  • 10:34:22

    WILLIAMSBut...

  • 10:34:22

    REHMHere's what I am interested in. This morning, NPR did a piece with Steve Inskeep on where the money is coming from for the Tea Party candidates. Where is it coming from, Juan?

  • 10:34:40

    WILLIAMSWell, you know, a lot of this goes back to big corporations who are hiding their hands. And, you know, you could then start talking about recent Supreme Court rulings and the like. But what you're seeing -- and again, The New Yorker has done some important work here -- is that you now have major businesses in this country who are very opposed to Obama policies. And they are happy to support Tea Party grassroots efforts that disguise their hand all too well. But they are concerned about economic policies, so it's, like, big business, which is concerned about money, is joining hands here with people who are saying that they are concerned, you know, that Obama is a socialist or whatever, but that Obama is this and that. They are using that for this larger aims, which is to undercut President Obama on his economic positions.

  • 10:35:34

    REHMAnd then you've got the cover of Forbes magazine, a cover story by Dinesh D'Souza. I think nothing has turned my stomach so much in recent years as reading that piece.

  • 10:35:53

    MARCUSThe first word that comes to mind is scarless. He purports to understand President Obama by imputing all sorts of visions that he says President Obama's father -- who President Obama barely knew...

  • 10:36:11

    REHMHe left when he was 2 years old.

  • 10:36:13

    MARCUSHe left when he was 2, saw once briefly after that, but in the world according to Dinesh D'Souza -- by the way, it's a world in which growing up in Hawaii makes you somehow un-American because that's not on the mainland. The president spent a few year -- was born in Hawaii, let's just say, and he spent a few years in Indonesia. He is an American. But Dinesh D'Souza believes that there is an anti-colonial Kenyan construct that is somehow kind of Manchurian/Kenyan candidating, controlling the president's mind and driving his policies, which Dinesh D'Souza describes as the most anti-business president in American history…

  • 10:36:59

    REHMAnd...

  • 10:36:59

    MARCUS...and it's just crazy.

  • 10:37:01

    REHMAnd then Newt Gingrich picks up the phrase, Jake.

  • 10:37:04

    TAPPERGingrich picked it up, the Kenyan anti-colonial worldview in an interview with the National Review he did. Look, I think that there is a -- as a White House reporter, I think there is a great deal that this administration has done or has not done that is perfectly appropriate to be criticized, to be condemned, to be attacked, but there is an unhinged quality to a lot of this. And the Dinesh D'Souza story is, for a scholar, very unscholarly.

  • 10:37:38

    REHMJake Tapper, ABC News senior White House correspondent. We'll take a short break and be right back.

  • 10:40:03

    REHMWelcome back. And we're going to open the phones. We have a number of other topics, but let's take your calls first. Let's go first to Weatherford, Texas. Good morning, Kenneth.

  • 10:40:20

    KENNETHYes, ma'am. Thank you for taking my call.

  • 10:40:21

    REHMSure.

  • 10:40:22

    KENNETHTwo brief comments and a short question. I have a friend that was in oil -- gas business, had a $500,000 line of credit, paid everything back, got out of the business. Now, he's back in it, been in it about two years. He can't get a line of credit. Just recently, he tried to borrow $20,000 for a new truck. And (word?) for a used truck. They would loan him money for a new truck but not for a used truck. And then the second thing is one of the local banks here in my town, the president of the bank, you know, made light of the fact that his bank took TARP money. But they were holding it in their reserves. My question, are the banks really not helping the situation by not lending out money to individuals that are creditworthy?

  • 10:41:10

    REHMRuth.

  • 10:41:11

    MARCUSThe -- to the extent that the banks are not lending out money to individuals that are creditworthy, they are not helping the situation. And I think one potentially useful thing that Congress is about to do is in the small business bill, which I'm a little bit dubious about how much help overall the government can give to small businesses. But there is a lending fund and other help for small businesses in this bill. And getting banks to feel more comfortable, giving them some safety net of their own to make these kinds of loans, I think, could be a useful thing in this recession.

  • 10:41:46

    REHMAll right. To Miami, Fla. Good morning, Lisa.

  • 10:41:52

    LISAHi, good morning. I have two comments. One is about the Republican Party and the second one is about the Tea Party. And I just have a hard time understanding how any person in the right mind would vote for a Republican candidate to the Senate in November, understanding that the census numbers really are showing what has happened in our country in the last 10 years. The last census was done in the year 2000. This is 2010, so this is something -- our current situation is not something that happened recently. It's not something that happened under the Obama administration. It's something that happened when the Republican Party had control of the Senate. That's my first comment.

  • 10:42:43

    LISAAnd then the second comment is the Tea Party -- in my mind, by what I can see -- is made up of two parts of the population, two types of people. One of them is people that only have a financial interest, and President Obama's policies not going through, number one. And second, you have people that have, what I believe to be, a fundamental problem with the president not being white -- instead, just being from a different color or a different race. And I think that's what's driving -- both of those things are driving the Tea Party to be as successful as it is, even though I don't believe that they represent a majority of the country.

  • 10:43:31

    REHMAll right. Juan.

  • 10:43:32

    WILLIAMSWell, I think one of the key things that's changed over the last few months is the percentage of Americans in polls who believe that President Bush is not responsible for the current economic crisis. An increasing number say that President Obama has been in office long enough. He's been in office, Jake, 19 months?

  • 10:43:49

    TAPPERYeah...

  • 10:43:49

    WILLIAMSSomething like that -- and people are more and more saying, you've been here now a sufficient period of time that you should be responsible for correcting the ills of the economy. So people are holding President Obama more responsible -- despite what the caller says about Republicans being responsible, President Bush, I suppose -- for the recession.

  • 10:44:07

    WILLIAMSOn the other point about race, we get back to this Dinesh D'Souza conversation. It is terribly troubling to me the amount of criticism of the president that's not directed at policy, recession, economy, but is really, I think, a personal effort to demonize him and to make him into what you might call -- if not the N word, the other -- to make him somehow distant from the American electorate. And I'm not sure it works with all of us in this room, given the level of education. But I think for people who are trying to stir up the Republican base and to say that this man is not like us. He wasn't born here, or he's not of our faith. Or he's someone who might oppose our way life. It's a tremendously powerful instrument.

  • 10:44:49

    MARCUSAnd it's said in a -- by folks who are either intentionally or unintentionally stirring things up, it's said in a more sophisticated way. I was at a breakfast week before last with Haley Barbour, the governor of Mississippi, who made what I thought was the astonishing statement that we know less about President Obama than any other president in U.S. history. And I was, like...

  • 10:45:13

    REHMHow can that be?

  • 10:45:13

    MARCUS...how -- hey, let's read the book.

  • 10:45:14

    REHMHow can it?

  • 10:45:15

    MARCUSLet's read both books. I knew a lot about him. I knew more about his childhood and college behavior than I knew, really, about George W. Bush's.

  • 10:45:24

    REHMJake.

  • 10:45:25

    TAPPERYou know, like I said before, there is -- there are so many valid criticisms to make of this administration. And there is this strange line of criticism about his long form birth certificate and whether or not he's a Muslim and whether he was born in the United States and his relationship with his father. Somehow Dinesh D'Souza argues that he is channeling his father's rage -- his father's communism even though his wasn't a communist.

  • 10:45:52

    REHMI didn't know Dinesh D'Souza had a background in psychiatric therapy.

  • 10:45:58

    TAPPERBut what's strange about it is that it's only growing. If you look at the percentage of Americans who think that President Obama is a Muslim, which is not the case. He is not a Muslim. Not that there would be anything wrong with it if he were a Muslim, but he's not. That percentage is going up. If you look at the percentage of people who say unequivocally that President Obama is a Christian, that percentage of Americans is going down. So this is taking hold.

  • 10:46:23

    REHMLet's go now...

  • 10:46:23

    MARCUSAnd...

  • 10:46:24

    REHM... to Midland, Mich. Good morning, Chuck. You're on the air.

  • 10:46:29

    CHUCKYes. There was mention of a Forbes article. I don't remember the author, maybe Dinesh. And...

  • 10:46:35

    REHMDinesh D'Souza.

  • 10:46:38

    CHUCKThank you. And he -- I have not seen the article, but it was described as defamatory and unhinged. And I have no doubt that it is. My question is, though, those that are calling that article as defamatory and unhinged about Mr. -- about President Obama, would they have called the same work done and published by Michael Moore as defamatory and unhinged, when Michael Moore wrote about President Bush?

  • 10:47:05

    REHMWell...

  • 10:47:05

    WILLIAMSWell, there certainly is a lot of attacks on President Bush. But if just to continue this analogy, when people said that President Bush, the son, was going to war because of President Bush, the father, and that Saddam had tried to kill the father and all of that, people dismissed it as being reckless and unfair to President Bush. People who were, I think, in the majority in the country. I'm not sure, as Jake just said, that the casting of aspersions on President Obama's faith seems to be gaining adherence, not losing them.

  • 10:47:38

    TAPPERThere was a -- definitely, an unhinged quality to a lot of things you heard from the left in the Bush years. And I would say, as Obama has the Birthers -- as they're called -- Bush had the Truthers, the people who thought that 9/11 was an inside job, that President Bush and Osama bin Laden had some sort of weird alliance, that the government knew about it ahead of time. And, absolutely, those people should have been criticized, and I know -- I'm sure, people at this table did.

  • 10:48:06

    REHMJake, I want to ask you about Elizabeth Warren. You broke the story about her new job.

  • 10:48:14

    TAPPERYeah, in a few hours, President Obama will announce the new position for Elizabeth Warren. It is not -- she -- he is not sending up her nomination as director of the Consumer Financial Protection Bureau -- which is this new agency created in the Wall Street reform bill, that is set up to help consumers, protect consumers from predatory lenders, from hidden fees from credit companies, mortgage companies, bank overdraft notices and the like. He is not sending it up to the Senate for a lot of reasons, one of which is they're not sure she could be confirmed. And he doesn't want to deal with the confirmation battle.

  • 10:48:51

    REHMAnd she might not be confirmed, not because she's not able, but because the bankers don't like her. She's been criticized by them.

  • 10:49:04

    MARCUSShe has been criticized. I'm going to be a voice of dissent here because I don't like recess appointments. And I don't like end-runs, and this is not a recess appointment. It's just a simple end-run, as far as I'm concerned, around the clear congressional intent that we're going to set up this new agency, and it is going to have a Congressionally confirmed head to run it. I didn't like it when the president recess appointed Donald Berwick, very capable, very competent guy, to run the Medicare and Medicaid program. I don't like this one. I think when President Bush did recess appointments of people like John Bolton to be the UN ambassador, he was criticized and rightly so by liberals for not following the normal rules. And I think it's really unfortunate, and it's too bad that Elizabeth Warren won't have the statutory authority that either being confirmed or even being recess appointed would give her to do this job.

  • 10:50:04

    REHMJuan.

  • 10:50:04

    WILLIAMSWell, I think that she will have -- she'll be an adviser, technically -- as Jake was describing this -- an adviser to the Treasury Secretary Tim Geithner as this organization, this Consumer Financial Protection Agency, gets created and formed. And so she will be -- have a hand in molding its direction, but she will have no authority. For example, she will not be able to sit on the FDIC board or the financial oversight board, so they'll be some weakness in the structure. But the -- to respond to Ruth's point -- I can imagine that at the Obama White House, they're saying Republicans keep holding up our appointees, and so we can't run government. We can't things going. We can't protect American consumers because they won't approve of her. And why are the bankers mad at Elizabeth Warren? Because she has been in charge of looking at how this TARP money was spent and insisting that they offer more loans. Going back to what the caller said earlier, he can't get a loan from the bank. Who's been the critic? Who's been putting pressure on the banks? Elizabeth Warren.

  • 10:51:03

    TAPPERAnd on the Treasury Department, she's been one of Tim Geithner's biggest critics from her position as a congressional overseer of the TARP money.

  • 10:51:09

    REHMSo he didn't want her either?

  • 10:51:11

    TAPPERWell, that was the rumor that she -- that he and Larry Summers had concerns. I interviewed Geithner a few months ago, and he disputed that. I think at that point, he'd been told by the president, probably, she was going to get the gig. She -- in addition to being a special adviser to him, she will also be a special assistant to President Obama. And in that special role -- that no one else in the world has, special assistant to the treasury secretary and the president -- she will supposedly have a little bit more authority. But she will not have the independence that the job truly calls for.

  • 10:51:44

    TAPPEROne other reason that the Obama administration says they wanted to have her go through this process instead of the confirmation process is they want her out there. They want her out there as the face of the administration, protecting consumers, talking about this in the next few months before the election. And when you go through the Senate confirmation process, you basically take a vow of silence and disappear until your hearing. And they didn't want that. They want her out there on TV, talking to voters.

  • 10:52:10

    MARCUSI just want to say one quick thing to Juan's point about the frustration and delay in the process. Every president is delayed, and correctly so, about how long it takes nominees to get confirmed. And it's been particularly egregious in this Congress. Otherwise, uncontroversial nominees just to have to wait forever. But you have to give the system a chance to not work before you can declare it not working and do an end-run around it. And that's where, I think, the president has gone wrong, both here and with Dr. Berwick.

  • 10:52:40

    REHMRuth Marcus of The Washington Post. You're listening to "The Diane Rehm Show." And, now, to St. Louis, Mo. Good morning, Adam.

  • 10:52:53

    ADAMGood morning, Diane. Thanks so much for taking my call.

  • 10:52:55

    REHMSure.

  • 10:52:56

    ADAMBig fan, long-time listener, first-time caller.

  • 10:52:58

    REHMGlad to have you.

  • 10:52:59

    ADAMJust got a quick, maybe slightly nitpicky point, on the discussion about taxes a little while ago, and that is that it's the earnings -- not the earners -- that are getting the tax cuts. So everybody will -- looking at getting a tax cut on the first $250,000 they make, and then what's controversial here are the tax cuts on money that everyone makes over $250,000. So if only the first part of that goes through, everybody still gets a tax cut. It's just that if you're so wealthy, and you're making more than $250,000, that money is not going to be taxed anymore. I just think it's important that we talk about that correctly. We had this conversation. It's an important point.

  • 10:53:40

    REHMI fully agree. Thanks for calling. To Willowick, Ohio. Lance, you're on the air.

  • 10:53:49

    LANCEHi, good morning.

  • 10:53:50

    REHMMorning.

  • 10:53:51

    LANCEI wanted to comment on the poverty figures. And as I was listening, I was beginning to feel that the discussion was missing, I think, a real important point. And it seems to me that the poverty figures point to -- at least they do for me -- a real issue and perhaps a struggle in crisis of values here in this country. If you look at the last 30 years -- when I look at the last 30 years and see that, you know, it has been primarily conservative politics and values that have dominated on our nation, I think. And I look at income figures for the wealthy that have gone up 20 to 25 percent over the last 30 to 40 years. And middle class have stayed flat and declined, and poverty has grown. And I look at the whole healthcare debate, there's this tension and conflict between a perspective that focuses on individual rights -- and perhaps individual rights only regardless of how they may affect others -- versus a perspective that feels freedom and liberty as being, not only about individual rights, but also individual responsibility and collective responsibility for everyone.

  • 10:55:03

    MARCUSWell, that's a big topic. But, I guess, the conservative response to that would be, well -- and there's a fascinating discussion on this on -- in The Washington Post today between Bob Greenstein from the liberal Center on Budget and Policy priorities and someone who -- from the Heritage Institution Robert Rector, I believe.

  • 10:55:23

    REHMHeritage Foundation, yes.

  • 10:55:25

    MARCUSAnd so the question is chicken and egg. Is it the dissolution of the family, the fact of so many children being born out of wedlock that leads to a lot of work culture, or are things the other way around?

  • 10:55:41

    REHMAnd, Juan Williams, I want to ask you about Dr. Walters who died this week and Edwin Newman.

  • 10:55:52

    WILLIAMSWell, let's start with Edwin Newman. He died at 91. He'd gone over to England, so he died in England. But of course, he's known here in the United States as one of the lead TV personalities from the '50s through the '90s -- I guess well into the '80s -- if not, you know, little spots into the '90s.

  • 10:56:08

    REHMWith a real penchant for the English language.

  • 10:56:11

    WILLIAMSAbsolutely. And his love of puns and insistence, and, I think, with a light touch. He was a very approachable guy. And also for Ron Walters, Ron Walters who was a political scientist, I think the first, in fact, chairman of the Afro-American Studies Department at Brandeis then chairman of the Political Science Department at Howard, involved with Jesse Jackson's two campaigns with the creation of TransAfrica and the opposition in this country to apartheid, just a very important figure in terms of black intellectuals.

  • 10:56:40

    REHMAnd a guest on this program many times. We will miss him. Juan Williams, he's NPR news analyst, FOX News political analyst, Ruth Marcus of The Washington Post, Jake Tapper of ABC News. Our program has been webcast. It will be up on our site at 12:00, noon. Have a great weekend, everybody. I'm Diane Rehm.

  • 10:57:12

    ANNOUNCER"The Diane Rehm Show" is produced by Sandra Pinkard, Nancy Robertson, Susan Nabors, Denise Couture and Monique Nazareth. The engineer is Tobey Schreiner. Dorie Anisman answers the phones. Visit drshow.org for audio archives, transcripts, podcasts and CD sales. Call 208-885-1200 for more information.

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