Friday News Roundup - Domestic

Transcript for: 
Friday News Roundup - Domestic

MR. TERENCE SMITH

10:06:56
Thanks for joining us. I'm Terence Smith, former correspondent with PBS, CBS and The New York Times, sitting in for Diane Rehm. Moody's downgraded five of the six largest U.S. banks. Republican presidential hopeful Mitt Romney appealed to a group of Latino officials in Florida yesterday. And the president speaks to them today. And a House panel voted to hold Atty. Gen. Eric Holder in contempt of Congress.

MR. TERENCE SMITH

10:07:24
Joining me for the domestic hour of our Friday News Roundup are Doyle McManus of the Los Angeles Times, Jeanne Cummings of Bloomberg News, and Ari Shapiro from NPR. Welcome to you all. Doyle, this Moody's downgrade of 15 banks overall, five of the six largest U.S. banks, what does it mean for the economy and for consumers?

MR. DOYLE MCMANUS

10:07:55
Well, it's bad news for the economy, Terry. It reflects continuing fears that we -- that Europe's financial crisis is not over, that the banking system is still fragile. What it means is that it will cost more money for these big banks, as you said, 15 banks around the world, five of the six largest U.S. banks, cost them more money to borrow. What that means for the economy as a whole and consumers in general is this: our problem for many months now has been that there's plenty of money in the system.

MR. DOYLE MCMANUS

10:08:32
The Fed has been putting money into the system, but banks are reluctant to lend even at low interest rates to good customers. They've been raising the threshold you need to reach to be able to qualify, and that has slowed down economic growth. And this does not help that.

SMITH

10:08:47
Mm hmm. Jeanne Cummings, the Fed has been spreading less than good news around, altering its outlook on the economy and suggesting that the economic growth -- its prediction anyway -- might go down from -- to 1.9 to 2.4 percent. How much of that has -- I mean, how much of a change is that and how significant?

MS. JEANNE CUMMINGS

10:09:20
Well, it is -- all of these indicators are significant in terms of the confidence that they are not showing in the growth. I mean, they dropped their growth projections by about a point. They, at one point, thought that unemployment might dip slightly below eight. They say now that won't happen. So it is a reflection of a consensus that we're growing, but we're growing really at a snail's pace.

MS. JEANNE CUMMINGS

10:09:51
And the problems in Europe are definitely having -- taking a toll on the United States at the moment. It's not dramatic, but it does affect the ability of businesses in the United States to export and to grow and to make money. So they -- you know, it's a reflection of the fact that the recovery that people thought in the spring was starting to really begin to get some traction has stalled at the moment.

SMITH

10:10:19
Ari Shapiro, the Fed also announced it would continue so-called Operation Twist through the end of the year. I would argue that's one of the worst names I've ever heard.

SMITH

10:10:30
But explain -- remind us what it is.

MR. ARI SHAPIRO

10:10:32
Well, it's actually named after the Chubby Checker hit from the 1960s which is when the Fed first came up with this idea. One of the, you know, most reliable tools the Fed has in its arsenal to boost the economy is lowering interest rates, and over the last few years, they have lowered interest rates so much that they effectively can't really lower them any further. So Operation Twist is kind of a bit of economic jiu-jitsu to try to get the same impact by doing different, you know, sort of, you know, moving the numbers around a little bit.

MR. ARI SHAPIRO

10:11:00
But the point of it is that, you know, as Doyle and Jeanne just said, this is yet another sign that there's not a lot of confidence in the economy right now. Somebody recently told me that it's like a plane that's just getting off the ground. If you run into turbulence, it's going to have more of an impact than a plane that is soaring at many thousands of feet.

MR. ARI SHAPIRO

10:11:18
This economy, you know, we're not going down into the ground, but we're in a fragile state. And so the kinds of impacts we could get from Europe, or even from the financial cliff at the end of the year, could really hurt the economy in a way that would undo what recovery we have seen over the last few years.

SMITH

10:11:33
Doyle McManus, the market was unimpressed on Thursday down -- the Dow down 250 points.

MCMANUS

10:11:42
Yeah, as a combination of both of these things, in a sense, what was most important about the Fed's action on Operation Twist wasn't what it did. It was what it didn't do. There are still a few things the Fed could do, basically or most notably a third round of quantitative easing, putting more liquidity, more money into the system. Ben Bernanke is being cautious.

MCMANUS

10:12:05
He's keeping a cautious consensus together on that Fed board, so he didn't take that step. He said he wanted to keep that in reserve in case the economy slowed even further. But, in a sense, that's -- as both Jeanne and Ari said, that reconfirms where we are. We're in a very, very slow growth period that isn't going to feel like growth to a lot of people.

SMITH

10:12:30
That suggests, Jeanne Cummings, that the Fed really doesn't have a lot of ammunition left.

CUMMINGS

10:12:34
Oh, and they're the only player in the game.

SMITH

10:12:37
Mm hmm.

CUMMINGS

10:12:37
No one else can do anything. And so they are -- what few tools they have left, as Doyle said, Ben Bernanke is trying to pace himself and try to keep a few in reserve. And we should throw in also the recent housing numbers which also are mixed, where housing sales were down a bit in the past month. But they're still better than a year ago.

SMITH

10:12:59
Mm hmm.

CUMMINGS

10:12:59
So, again, there are these mixed signals where there is improvement, but it's just really slow.

SMITH

10:13:06
There is actually -- the sale of previously-owned homes up 9.6 percent in May, and prices are edging a little bit higher.

CUMMINGS

10:13:17
And it depends on where you live. I mean, there are some markets that are starting to come back where, you know, houses are selling really quickly once they go up because this demand that has been pent-up for the last couple of years is now beginning to express itself. And also, the interest rates are just ridiculous.

CUMMINGS

10:13:37
You know, under 4 percent for a 30-year mortgage is just an amazing interest rate, and people are beginning to refinance and buy houses, taking advantage of that. So it's very spotty. There are some places where you don't see really any real signs of recovery. And in other places, it's starting to look almost normal again.

SMITH

10:13:56
Ari Shapiro, what's -- from your perch at the White House, what -- what's the perspective there? What are the politics here, a president having to run for reelection with unemployment above 8 percent and a relatively flat economy?

SHAPIRO

10:14:10
The president has a really tough message to deliver, which is, as bad as it may seem right now, it would've been worse but for the things that I did. In contrast, Mitt Romney has a much easier message to deliver, which is, I can do a better job than the guy currently in office did. So, you know, there was a day last week when President Obama and Mitt Romney were both in Ohio giving sort of dueling speeches in Cleveland and Cincinnati.

SHAPIRO

10:14:31
And President Obama's speech was much longer, much more nuanced, and it just has to be because the message he's trying to deliver to the electorate has to be a more nuanced message than Mitt Romney's very clear cut, I can do a better job than the guy in office.

SMITH

10:14:46
Doyle McManus, switching to the controversy over Eric Holder, the attorney general and the decision by the White House to assert executive privilege, hold back some documents on the Fast and Furious program, what's the political fallout of this?

MCMANUS

10:15:06
Well, without going through the entire tangled history of Fast and Furious, which could take us the rest of the hour...

SMITH

10:15:13
Then, no, please, don't.

MCMANUS

10:15:16
...this really does drive us into a constitutional confrontation that I don't think either party quite anticipated.

SMITH

10:15:20
Mm hmm.

MCMANUS

10:15:23
Although, given the way these two parties have treated each other over the past couple of years, it wasn't that hard to imagine a scenario that we saw, which was that neither side could find a way out of it. At this point, the House -- Darrell Issa, the chairman of that investigating committee, is demanding many more documents. Eric Holder, the attorney general, offered some more documents if Darrell Issa would say, in effect, OK, this will be our last demand, and we'll consider the matter resolved. They had late night negotiations over that, came to an impasse.

MCMANUS

10:15:58
OK, the House committee voted to hold Holder in contempt. The full House is scheduled to vote on that next week. And it's very difficult to imagine a scenario in which that Republican majority doesn't go ahead and deliver that rebuke to the attorney general. Now, how does the politics of this shake out? It's not a great issue for the president or the White House. They are on the wrong side of this in that, you know, if you want to -- that, initially, when the Justice Department was asked about this program, about the gun -- what's called gun-walking into Mexico, they said, well it's not going on.

MCMANUS

10:16:31
We don't know anything about it. They've acknowledged that wrongdoing. On the other hand, is this really what Republicans in the House want to be talking about and arguing about on television for months and months? Well, no, actually their agenda is -- of course, is supposed to be to talk about jobs, jobs, jobs. And so they run the risk of looking as if they're pursuing the administration on everything else but jobs.

SMITH

10:16:55
Jeanne Cummings, several reason attorneys general have had problems with Congress and been in tight spots with the executive refusing to turn over documents or whatever. What's the political impact to this? And look ahead to the election. Is anybody going to be talking about this?

CUMMINGS

10:17:17
No, they aren't going to be. And that's -- I mean, I agree with Doyle that it's not good for either side. But I think, on balance, this is -- Congress has just gotten itself, you know, in a patch where they should probably find their way out. I mean, if you look at any focus group with voters, all they care about is the economy. That's all they care about. And for -- to create this big constitutional clash with the White House makes Congress, once again, look like it's just got its eye off the ball. This isn't what people want them to do.

CUMMINGS

10:17:50
They are tired of the confrontations in Washington. They're frustrated by it. And they think that Washington doesn't understand their problems and isn't trying to help them. This just gives them one more reason to think that Washington is out of touch. And then, in the end, when you look at what would be the real impact of all of this, if they find them in contempt, that should be -- that contempt citation would be enforced by the U.S. attorney general who works for the Justice Department. So we're going nowhere here.

SMITH

10:18:18
So circles within circles. All right. Coming up, more about these and other domestic issues from our Friday News Roundup panel.

SMITH

10:20:04
Welcome back. I'm Terence Smith, sitting in for Diane Rehm who is out with a cold but assures us she will be back on Monday. I'm joined for the Friday News Roundup on the domestic side with -- by Doyle McManus, a columnist for the Los Angeles Times, by Jeanne Cummings, deputy government editor at Bloomberg News, and Ari Shapiro, the White House correspondent for NPR.

SMITH

10:20:30
I have some emails here, including one rather sharply worded one from David on the subject of the contempt citation. He writes, "It appears that 85 percent of the country holds the Congress in contempt. Therefore, the hearings on Fast and Furious are an attempt to distract from the economic issues that the Congress is not able to handle. Isn't that the fact, Ari Shapiro?" says David.

SHAPIRO

10:21:02
This is a point that Spokesman Jay Carney made at the White House yesterday in the briefing. He said, if Congress wonders why they are the most unpopular of any Congress in recent memory, maybe if they would spend their time working on the economy instead of what Carney called partisan fishing expeditions, they might see their numbers go up. You know what? As you mentioned, many attorneys general recently have been in this kind of trouble with Congress.

SHAPIRO

10:21:24
And I covered the Justice Department when Bush's Atty. Gen. Alberto Gonzales was under fire for the U.S. attorney dismissals, which ultimately led him to leave the post of attorney general under a cloud.

SMITH

10:21:31
Mm hmm.

SHAPIRO

10:21:36
And one big difference between that controversy and this controversy is that when Gonzales was under fire in Congress, there were Republicans and Democrats calling for him to step down. Now, we've seen six Republican senators call for Eric Holder to step down, but the Democrats have been a united front. And I think it's only when and if we see Democrats turning against Holder, which I don't expect we're going to see, that this will really enter a new phase.

SMITH

10:22:02
Doyle McManus, on the ever sensitive issue of immigration, we heard Mitt Romney softening his position, trying to add a little nuance to it, trying to improve his standing within, at least, the Latino community. Where do you see this debate going? We expect to hear from the president later today on addressing the very same audience in Florida on the same topic.

MCMANUS

10:22:30
Well, in a sense, this is another debate that the White House might like to keep going as it might like to keep the debate over Fast and Furious going because all of these are not debates that focus on the doleful state of the economy. What Mitt Romney needs to do and knows he needs to do and has said he needs to do is soften his image among Latino and Hispanic Americans. His problem, of course, is that, during the Republican primary campaign, he campaigned against Rick Perry and others as the most ferociously anti-illegal immigration candidate there on the dais.

MCMANUS

10:23:08
Now, the problem, of course, is that Latinos and Hispanics are the fastest growing voter bloc. They are a group -- an ethnic group that Republicans, for many years, have thought should be up for grabs and will be up for grabs someday. But somehow, Mitt Romney has to get out of the hole he's been in, so he's now talking about how he is, as Republicans generally are, in favor of legal immigration.

MCMANUS

10:23:31
He's trying to find the pieces of immigrant-friendly legislation that he would be for, including an easier path to citizenship for immigrants in the armed forces. But those really are the easy parts. And Mitt Romney wasn't very clear on how far he would go. He wasn't clear on what he would do about President Obama's recent decision to refrain from deporting minors. He didn't go as far as Sen. Marco Rubio. The conservative senator from Florida, was ready -- was willing to go with his own proposed legislation. So Mitt Romney still has, I think, some ground to make up.

CUMMINGS

10:24:10
Well, and it seems like it's just a missed opportunity. He does -- everything Doyle says is so. He went way hard right. If you talk to...

SMITH

10:24:19
During the primary.

CUMMINGS

10:24:20
During the primary. And if you talked to Democrats at that time, what they were most happy about in watching the Republican primary was to see how he got pushed, how Romney got pushed on immigration because they knew he'd been pushed too far, and they could try to exploit that. And so it's a tricky pivot for Romney given his history of pivots. But this was an opportunity for him to say something.

SMITH

10:24:45
Mm hmm.

CUMMINGS

10:24:45
And he didn't. He didn't say anything that that audience could grab onto and say, there's a reason. We quoted a Republican Miami official who was at the event, who came out of it and said, here's what we've got. We've got a choice between a guy who makes a lot of promises and doesn't really keep them and a guy who doesn't even bother to make any promises. That's not much of a choice.

SMITH

10:25:09
Ari Shapiro, what's the perspective at the White House?

SHAPIRO

10:25:12
Well, one key policy point that a lot Latinos are listening for is, will Mitt Romney leave in place or repeal the policy that President Obama announced last week where he's going to allow some students who came to the U.S. illegally as small children to stay in the country legally? Romney says he's going to supersede that short-term policy with a long-term policy which he has not fully laid out.

SHAPIRO

10:25:33
The reason this is important is that -- I had a conversation this week with a woman from Ecuador who said she knows three people who are going to be affected by the policy President Obama announced last week. But these people don't know whether to buy in to the program because, A, they're afraid that if they give their names and addresses to the federal government, well, those are also the names -- those are also the addresses of their parents who came to the country illegally not as young children.

SHAPIRO

10:25:56
But, more importantly, insofar as the Mitt Romney-Obama debate goes, they don't know if this policy is going to stay in place. And if it doesn't, do they then feel comfortable giving all of their personal information to the federal government with this tentative promise, they'll be able to stay in the country legally when they don't know whether that promise will hold through into a Romney administration?

SMITH

10:26:15
Well, then I would assume that President Obama has to address some of those questions, some of those issues today.

SHAPIRO

10:26:21
You know, President Obama says he wants a long-term solution to the immigration problem and that he's searching for a Republican partner who he can work with on these long-term solutions. And yet yesterday, Sen. Marco Rubio of Florida, who has been the most vocal about a long-term immigration solution, Sen. Rubio said he has not had one conversation in the last year and a half with anyone in the administration about immigration. So that kind of tells you where things stand.

SMITH

10:26:45
Doyle McManus, Romney goes on from Florida to Utah this weekend where he is convening supporters, bundlers, others, including some possible vice presidential candidates, and pulling them together for a conference. What's to be expected from that?

MCMANUS

10:27:08
What's to be expected from that is not a lot of press coverage because this is all going to be behind some very well-manicured closed doors, if doors can be manicured.

MCMANUS

10:27:19
But it's another sign of what is shaping up as potentially a quite significant fundraising advantage for Gov. Romney in this race. The White House -- the Obama campaign has already warned that this may be, in their view, the first time in history that an incumbent president is going to be outraised and outspent by a challenger.

MCMANUS

10:27:42
Now, there's an interesting historical question about that because, depending on what kind of money you count and what kind of outside money you count, in 2004, John Kerry, Democrats and liberals probably outspent George W. Bush, if you wrap in the money from George Soros and everybody outside. So it's a matter of categories here. But it still is a remarkable development that Mitt Romney has captured most of the money from Wall Street, a place where Barack Obama outspent -- outraised, pardon me, John McCain four years ago...

SMITH

10:28:16
Mm hmm.

MCMANUS

10:28:16
...that Mitt Romney is doing very well in the business community, that they're very well -- and if you do add in all the outside money, it's absolutely clear that on the Republican and conservative side, there will be more money to spend than on the Democratic and liberal side.

SMITH

10:28:31
Jeanne Cummings, at that same gathering, that retreat in Utah this weekend, there will be several vice -- possible vice presidential picks for Mitt Romney: Rob Portman, Rep. Paul Ryan, Louisiana Gov. Bobby Jindal, but notably not Marco Rubio.

CUMMINGS

10:28:50
Well, that's right, and there were very -- there were conflicting reports this week about the status of Rubio. Initially, the word was that he was not being vetted, he had not been asked to deliver any of his records to the campaign. This, of course, was not good news for the Romney campaign given that it broke about two days before he was going to make that speech before the Latino organization. So then the campaign quickly came out and said, oh, yes, yes, he's being vetted. So that was not a particularly good moment. I don't think it's clear at all whether Rubio is being vetted. They say that he is.

CUMMINGS

10:29:25
We've heard both sides of this now, unclear which one is true. The thing that is remarkable in Utah, and there are -- there's a lot about this event that I think could prove to be significant. First of all, the locale is spectacular. It's utterly gorgeous. And Romney, in every single poll, is viewed as being out of touch with average Americans. And this is the visual image, again, that we're getting of Romney and his campaign, this beautiful resort where his very wealthy donors will all gather. We will have a...

SMITH

10:30:02
This is in Deer Valley, is it?

CUMMINGS

10:30:04
It's...

SMITH

10:30:05
Park City, Deer Valley.

CUMMINGS

10:30:05
Yes, Park City. Right.

SMITH

10:30:06
Mm hmm.

CUMMINGS

10:30:07
And you also have the commingling of the campaign and the super PACs. They're all together there. Karl Rove will be there, so Crossroads, the big Republican super PAC and its partner that does not reveal its donors, they'll be in the room. So we have a total mixing of both the outside groups and the campaigns. We've never seen anything like that.

CUMMINGS

10:30:32
And then, of course, you're right. We'll have some of these vice presidential candidates being tested and introduced to the big donors. And so they can face some questions. The donors can size them up, maybe give some feedback to the campaign about their performances there. So there's a lot going on in Utah this weekend.

SMITH

10:30:51
Mm hmm. Ari Shapiro, you've spent some time with the Romney campaign.

SHAPIRO

10:30:54
Yes. You know -- and with Marco Rubio, who, we should mention, yesterday said he was invited to attend the Utah weekend, but he said -- he writes a lot in his book, actually, about the tension he feels between family, kids on the one hand and work on the other hand. He said if he went to Utah, he would have had two uninterrupted weeks without seeing his kids. And they had a lot going on in Florida, so he just had to be there with them. Could be a variation on I want to spend time with my family, but who knows?

SHAPIRO

10:31:21
You know, the fact that the super PAC, the outside groups and the Romney campaign are going to be there together is partly significant because there is this legal requirement that the outside groups not coordinate with the campaign, which so clearly, on the left and right, appears to be an utter fiction.

SHAPIRO

10:31:39
Even if they're not actually coordinating with each other, they're sharing office spaces. You have a lot of overlap from people leaving the campaign or leaving the White House, going to these outside groups. And so it just sort of points out, all the more, how wedded outside and inside are despite the sort of legal frame that says they're not allowed to be connected.

SMITH

10:32:01
I'm Terence Smith. You're listening to "The Diane Rehm Show." If you'd like to join us, call us at 1-800-433-8850 or send an email to drshow@wamu.org. Find us on Facebook or send us a tweet. Jeanne Cummings, the latest Bloomberg poll shows President Obama leading Mitt Romney by 13 points. Now, that's different, and that seems, frankly, a bit high.

CUMMINGS

10:32:30
Well, it does. And we had a lot of attention focused on this poll because of that. And we've evaluated it, and, you know, the number, we think, is probably too high. It's too big a gap. What we do think is that our poll did catch a trend, that generally what the poll reflects is correct. That gap, that particular number is probably too high. Pew came out with a poll this week, had Obama up by four. AP has a poll out, having Obama up again, not by the margins we have, but up.

CUMMINGS

10:33:03
So what our poll, we believe, did was catch the right moment at this time in the campaign, and that is that Obama has edged a little bit ahead of Romney, which, when we looked at the poll, we believe is because of several factors. First of all, Romney has been spending most of his time raising money, which is typically what a nominee would do at this time. But that has not allowed him to try to recover from the Republican primary in which he, you know, took quite a beating in attack ads and things like that from his fellow candidates.

CUMMINGS

10:33:40
And he came out of that primary with high unfavorables, and they have not gone down, in part, because they haven't really focused on addressing that because their primary focus -- at a recent fundraiser, it was reported Romney said he's spending 70 percent of his time raising money. And those of us trying to cover him know all of that has been behind closed doors.

SMITH

10:34:02
Mm hmm.

CUMMINGS

10:34:02
So he's not really engaged the public yet on his candidacy and this campaign.

SMITH

10:34:08
Doyle McManus?

MCMANUS

10:34:09
The flip side of those numbers is interesting as well. That is to say, if you look at what is going on on the Obama side of the ledger -- and on this I'm going to refer to the Pew poll -- the Pew poll found that, actually, enthusiasm among Democratic voters is slightly higher at the moment than it is among Republican voters. Now, this is a reversal of a trend that people expected to see earlier this year: disappointed Democrats about Barack Obama's inability to get his agenda through and so on, the enthusiasm gap.

SMITH

10:34:29
Mm hmm.

MCMANUS

10:34:36
Well, it appears, if you go by this poll, that one of the products of the last couple of months, the sharpening of the partisan debate and President Obama and the White House's concentration on a number of issues that are friendly to groups in the Democratic coalition -- Latinos, African-American students who want student loans, women -- the concentration on the social issues has actually boosted Democratic enthusiasm, the enthusiasm of the Democratic base.

SMITH

10:35:06
Should we be paying attention -- let me ask any of you this -- to national polls at this point before the all-star break and, I would argue, before a large bloc of the American public is paying a great deal of attention?

SHAPIRO

10:35:21
Well, this is one interesting thing, is that the election is not decided by the popular vote. The election is decided by a handful of swing states, and the trends in those swing states, in some respects, counter the national trends. You know, at the beginning of the hour, we talked about some of the dire warning signs in the economy nationally, all of which are valid.

SHAPIRO

10:35:38
But when you look at some crucial swing states -- you know, Michigan, Ohio -- the unemployment rate has dropped three points or more since President Obama took office and, in some cases, is even lower than the national average. And so some of those could be more telling indicators than some of the national numbers that grab the headlines.

CUMMINGS

10:35:56
And I'll just add, one of the things we wanted to do with this poll was really test people on the economy because in -- historically, people who do public opinion research say it's around this period that people make up their minds about how the economy is going. And so this poll actually had lots and lots of economic questions inside of it. And we found a little bit of an uptick. It was significant -- it wasn't little, but it wasn't big either -- that people are feeling a little better about themselves than they did in 2009.

CUMMINGS

10:36:33
And when we went back and called those people, they basically were saying, look, I'm sick of the doom and gloom. I'm just done with it. I'm all right. I didn't lose the house. I still got my job. I'm OK. That kind of different attitude is what we were trying to test if people were really down in the dumps or were they seeing anything, any improvement, looks like some improvement. But I will note that our poll wasn't all good for Obama because when it came to handling the economy, he still doesn't score well, and that's Romney's opening.

MCMANUS

10:37:01
All that being said, Terry, to go back to your fundamental question, no. There's still four-and-a-half months to go before election day. Polls at this point have low predictive power on who's going to win. If you looked at polls in early stages and early elections, we would have had a President Dukakis, a President Kerry and a President John McCain. It didn't happen. But there is one thing these polls are still telling us: It's likely to be a close election.

SMITH

10:37:25
I think we believe that. Coming up, your calls and questions for our panel. Please stay tuned.

SMITH

10:40:04
Welcome back. I'm Terence Smith, sitting in for Diane Rehm. It's the Friday News Roundup, and I'm with Doyle McManus, columnist from the Los Angeles Times, Jeanne Cummings, deputy government editor of Bloomberg News and Ari Shapiro, White House correspondent for NPR. Here -- Ari, you referenced this before, but here is a rather sharply worded email from Marilyn in Arvada, Colo.

SMITH

10:40:32
She says, "You all talk about the Utah gathering as if it were perfectly acceptable, yet it is illegal -- she writes it in caps -- for the candidate to coordinate with the leaders of his super PACs. And Karl Rove is on the two-day program along with other super PAC CEOs." What about it, Jeanne?

CUMMINGS

10:40:52
Well, I think what -- it is true it is illegal for the candidate's committee to coordinate with these outside groups. The federal courts opened the door to this. It's not just the Supreme Court decision that allowed the big money in. There were other rulings that paved the way for the environment today. And the federal election commission tried to write rules and regulations around it and failed.

CUMMINGS

10:41:16
And so we're in the Wild Wild West, and the people who are deciding what coordination means basically are the campaigns and their lawyers. And the way it's operating now is that the super PACs can't coordinate, but they can hire the same lawyer as the candidate. They can hire the same media company as the candidate. So they don't coordinate with the campaign, but they can crossbreed through who they hire.

CUMMINGS

10:41:41
In addition, they can get all kinds of information to help them. For instance, when a candidate goes in and buys TV time, it's public. They get those records, and they see, well, looks like Romney's light here, or it looks like Obama isn't -- hasn't got Colorado covered. And so then their outside groups can go in and fill those gaps.

SMITH

10:42:00
Mm hmm.

CUMMINGS

10:42:01
So there are -- there's a multitude of ways in which they cannot coordinate, but, in fact, in behavior, they look like they are. But it is significant that Rove is there. The regulators have allowed, have said that the candidate can raise money for his super PACs. Romney went to events for his super PAC Restore Our Future and encouraged his donors to give. That's legal, but, boy, that doesn't look good.

CUMMINGS

10:42:27
The White House -- Obama's not going to do it for Priorities USA. But I wouldn't be surprised if we don't start seeing some members of the administration try to help that group raise money. And they've also recruited Bill Clinton to help them. So both sides are operating in this environment.

SMITH

10:42:43
Doyle McManus, here's another email. "Why don't you talk about all the disgusting Hollywood and New York fundraising shindigs of Obama?"

MCMANUS

10:42:52
Well, it's true that President Obama holds his fundraisers in nice places, too.

MCMANUS

10:42:58
Fundraisers -- you know, fundraisers go after wealthy people who are going to give money, so you don't have them at Motel 6. You have them at luxury resorts. You have them in fabulous homes. So I will agree on this level. I think it's unfair to wrap Mitt Romney with the charge that he's holding his fundraisers at luxury resorts. I think the point Jeanne was making was that it's not going to help Mitt Romney escape his image problem as a rich guy who only spends his time at luxury resorts. But the fundamental problem we have here, obviously, is that we now have a completely wide-open system.

MCMANUS

10:43:36
There is no barrier -- no effective barrier to any kind of money coming in. The campaigns, especially on the Republican side, are pushing the envelope 'cause there's no enforcement authority that works. The Federal Election Commission isn't going to get around to doing anything before Election Day. There's no way to bring anything in the courts. And this really will require, if people don't like it, some kind of legislative or constitutional amendment fix after Election Day.

SMITH

10:44:03
All right. Let's take a call. We have a number waiting. Nadine, you're in Memphis, Tenn. and on "The Diane Rehm Show."

NADINE

10:44:13
Yeah, good morning. Thank you for taking my call with this discussion.

SMITH

10:44:15
Good morning.

NADINE

10:44:18
Question is, the Congress has such a poor standing, such a poor rating with Americans, why are they not being blamed for this financial crisis we are going through? And why would that not reflect in a better election chances for Democratic candidates although this is a presidential election year also? I mean, isn't that where the blame should be shifted to as a Democratic strategy and that's a reality, too?

SMITH

10:44:45
Jeanne and maybe Ari?

CUMMINGS

10:44:47
Well, it's a very good question that Nadine raises, and it is -- it was thought about a year ago that this would be a throw-the-bombs-out kind of year. And it really is proving not to be so. Other than internal, intra-party primary fights, we don't see the public really in the mood to throw out incumbents. And so why aren't Republicans being blamed? I think if you look at the Congress' unfavorability rating, they, in fact, are being blamed.

CUMMINGS

10:45:18
They've been down into single digits of favorability, which I, you know, we all assume it's probably just their families and the people who work for them who are giving them a positive rating. So they are being blamed. But because of different things, like the way the districts are drawn and the power of incumbency, they still manage to hold on to their seats most of the time.

SHAPIRO

10:45:40
Look, nobody questions that if President Obama were running for reelection against House Speaker John Boehner or Sen. Mitch McConnell, he would walk to victory. And this is one reason that Mitt Romney is running as a Washington outsider. He realizes that people do blame Congress, and they also do blame President Obama. And that's why he's framing himself as this breath of fresh air.

SHAPIRO

10:46:03
You know, I think Republicans are very concerned that they will be blamed for the economy more than they are, which is one reason you see these movements towards addressing the fiscal cliff. It's one reason you see the reluctance to buy wholly into the Fast and Furious contempt citation because they are worried that this will stick to them even more than it has already.

SMITH

10:46:23
Mm hmm. And yet, Doyle McManus, the Republicans stick to a policy, announced and open, of obstructing Obama and his program, and they obviously must think it's good politics.

MCMANUS

10:46:40
Well, it's not just good politics. It's a good policy from their standpoint. Look, the gulf between the two parties is very wide, and a lot of Obama supporters like to say, look this is totally unfair. The House of Representatives -- let's remember, the Republicans only have one-half of Congress, but the House of Representatives is being obstructionist.

MCMANUS

10:46:58
Well, look, when you've got one party that's in favor of lower taxes on the wealthy and a much smaller government and the president's party is in favor of higher taxes on the wealthy and an activist government, some measure of obstruction is -- should not be surprising. The other issue, of course, here is that House members don't run nationwide. They don't even run statewide. They run in districts, and most of those seats are safe.

MCMANUS

10:47:23
The forecast in the House, if anyone is looking for a big backlash against this obstructionistic, conservative majority, the forecast in the House where the Democrats would need 25 seats as a pick-up to get their majority back is they're much more likely to win 10, maybe 15, maybe a little more than that if it's a good year. But I don't know of any serious forecaster who thinks the Democrats are going to take the House back.

SMITH

10:47:47
OK. Let's take a call -- another call. This is from Frank in Charlotte, N.C. Frank, you're on "The Diane Rehm Show."

FRANK

10:47:58
Oh, hi. OK, so what I had to say had to do with Eric Holder and his contempt.

SMITH

10:48:04
OK.

FRANK

10:48:06
If you could watch this documentary, the "Body of War," you'll see one of our representatives holding a piece of a paper saying, if you read this, you would vote for war with Iraq, OK, which we had over 4,000 Americans killed. OK? Isn't it time for our media, you people, to ask to see those papers and forget about this Fast and the Furious, you know, because it doesn't have much to do with what's going on down there...

SMITH

10:48:35
Well, Frank, I think there are any number of papers and documents that I suspect the media would like to see. But, Jeanne Cummings, what do you think?

CUMMINGS

10:48:47
Well, clearly the media want -- would love a lot more transparency on a whole lot of issues with the federal government, and, you know, we do the best that we can. We cover things as aggressively as we can, but we don't have access to everything. And we'll just keep pushing and trying to, you know, uncover everything that we can on all topics from war to gun laws.

SMITH

10:49:12
All right. Cynthia in Fort Lauderdale, Fla. has been incredibly patient with us. Cynthia, welcome to "The Diane Rehm Show."

CYNTHIA

10:49:21
Thank you. A large number of homeowners in my area who are having trouble paying their mortgage are Latinos. So I was amazed when I recently heard Sen. Marco Rubio on CNBC admitting that many homes in Miami are in foreclosure. But, just like Mitt Romney, Rubio said these homes should be allowed to go into foreclosure, that it was a good opportunity for real estate investors. There's a disconnect here when you act like you care about Latinos but say let the investors gain from their misfortunes.

SMITH

10:49:54
Well, Ari Shapiro, that is certainly a form of tough love.

SHAPIRO

10:49:57
I think Cynthia points to an important point, perhaps inadvertently, which is that we in Washington often talk about Latinos as though they care about immigration full stop. And Latinos care about a lot of things. And if Latinos don't have jobs, Latinos care about jobs. And if Latino sons and daughters are serving in a war, they care about the war. Latinos care about all the things that every American cares about, including housing.

SHAPIRO

10:50:19
The housing crisis has been one of the thorniest problems in this entire economic recession. And Mitt Romney and many in the Republican Party, and even some Democrats, say the only solution is to let it get worse before it gets better and clear out the system, that some people were sold homes they couldn't afford that -- people who should not have been homeowners. It certainly is a form of tough love, and it may not win people over. But in the minds of the people advocating these policies, it's what the system needs before it gets better.

SMITH

10:50:46
Doyle McManus, let me ask you about the fact that some Democratic representatives have announced plans that they're actually going to skip the Democratic National Convention in Charlotte, N.C. this summer. One is Pennsylvania Rep. Mark Critz, New York Representatives Bill Owens and Kathy Hochul and also Gov. Earl Ray Tomblin and Sen. Joe Manchin and Nick Rahall in West Virginia. What's going on here?

MCMANUS

10:51:14
And you can add to that list Jim Matheson, the Democratic congressman from Utah. What is going on there is that there are a few -- a very few remaining districts as you might call Blue Dog districts, districts with conservative Democrats. They are an endangered species. The EPA ought to have them on a list with some of those birds and fish they're always looking out for.

MCMANUS

10:51:34
These folks are going to have a very hard time holding on to their seats given the expected flood of outside money into their districts to defeat them. Incidentally, this is where, I think, most of us think outside money, the independent committees, are going to have their greatest impact. It's going to be on House and Senate races where the candidates have much less ability than a presidential candidate to raise the money to counteract it.

MCMANUS

10:51:56
This is not entirely a new phenomenon incidentally. There have been members in the past -- in fact, Mr. Matheson from Utah is one -- who have refrained from going to Democratic conventions before. Most members of Congress from a political party want to have their picture taken with the nominee, want to have their picture taken on that floor with all of the bonding, and others in these districts want to stay as far away as they can.

SMITH

10:52:18
There are actually proposals now in Congress to withdraw the public funding...

SHAPIRO

10:52:24
You know, the fact is...

SMITH

10:52:24
...for their national convention. Ari Shapiro.

SHAPIRO

10:52:26
These conventions tend to be a lot of crazy hats and wild opulent parties. And particularly if you are living in a district that is suffering economically, that's not the image you want to present to the folks back at home. Going to a town hall meeting is probably going to win you more votes than going to Charlotte, N.C. and partying with, you know, a bunch of people who have nothing to do with your district.

CUMMINGS

10:52:46
Well, and what we should note, things happen at these conventions that matter. And I agree with Ari completely. A town hall meeting is a much more productive exercise for somebody who is running for office, especially someone in a tight race. But what really happens at these conventions is fundraising.

SMITH

10:53:03
Mm hmm.

CUMMINGS

10:53:03
And so that's what you see. You see members of Congress come in because all of the big donors for the parties are there. They're, you know, trapped in these hotels. They're stuck on that floor, and it's a good way to buttonhole people. It's a good way for new candidates who are unknown to the large donor base to be introduced to them. There's a lot of networking that goes on behind the scenes at these conventions, and that's probably the last useful thing that these conventions serve as other than the nominating speech.

SMITH

10:53:35
May very well be. I'm Terence Smith. You're listening to "The Diane Rehm Show." I'd love to take another call here or two. Here is David in St. Louis, Mo. David, welcome to "The Diane Rehm Show."

DAVID

10:53:51
Good morning.

SMITH

10:53:52
Good morning.

DAVID

10:53:52
Within the conversation of picking a running mate and the debacle that occurred with McCain-Palin, I'm just curious, why is it that the presidential candidate picks his own versus simply taking the second place who would have been there had Mitt Romney not won?

SMITH

10:54:14
And I suppose second place -- we don't actually have that, but that would have been Rick Santorum.

CUMMINGS

10:54:21
Right. That shows why that system won't work.

CUMMINGS

10:54:25
I mean, in the primary, the last two guys duking it out or saying the worst possible things about each other, they're fighting really hard, and there's a lot of bad blood left. And so to set up a system like that would then put together this most dysfunctional marriage that would then have to go off and try to, you know, get itself together and run through the general election.

CUMMINGS

10:54:47
And you're going to have two -- you'd have two people who have big fundamental disagreements with one another -- or potentially you could -- who would then have to find way to govern. And so it would be a shotgun marriage that would probably not be beneficial to governing in post election.

SMITH

10:55:03
David, you're trying to apply logic to our political system. Doyle.

MCMANUS

10:55:06
But, actually, and, you know, the veepstakes is a race that has consumed the curiosity of many of us here in Washington, even the folks in -- out in the country aren't as consumed. But the other piece of this is that the nominee gets to choose a running mate who's going to reinforce whatever message about his image, about his policies, about his capabilities that he wants to take to the country. And this is one reason that a lot of the conventional wisdom is now saying that Marco Rubio's chances of being the vice presidential nominee are probably dimming.

MCMANUS

10:55:37
Because a Marco Rubio candidacy would mean, number one, a lot of focus on the difference between Romney and Rubio on immigration, and, number two, Marco Rubio is a pretty sharp-edged Tea Party kind of guy. And people are now increasingly looking at Tim Pawlenty, the former governor of Minnesota, who gets along very well with Gov. Romney, and, of course, Sen. Rob Portman of Ohio as more likely running mates.

SMITH

10:56:00
Ari Shapiro, you may have what may be the last word here.

SHAPIRO

10:56:03
Well, the vice presidential candidate needs two qualities during the campaign, which is cheerleader for the presidential candidate and attack dog for the opponent. Sarah Palin had both of those, but she lacked what Mitt Romney calls the most important quality, which is the ability to be president from day one. He has said that, above all else, that's what he's looking for. Makes it unlikely we're going to see a surprise out-of-left-field kind of pick the way we did with Sarah Palin four years ago.

SMITH

10:56:27
So that puts a Rob Portman or someone like that moves up the rank?

SHAPIRO

10:56:29
Somebody who is, frankly, a little bit boring.

MCMANUS

10:56:32
Yes.

CUMMINGS

10:56:33
Yeah.

SMITH

10:56:34
All right. Well, you're not boring, any of you. Doyle McManus, Jeanne Cummings, Ari Shapiro, thank you all three of you very much…

CUMMINGS

10:56:41
Thank you.

SMITH

10:56:41
...for this discussion. I'm Terence Smith, sitting in for Diane Rehm. Thank you for listening.

ANNOUNCER

10:56:47
"The Diane Rehm Show" is produced by Sandra Pinkard, Nancy Robertson, Denise Couture, Monique Nazareth, Nikki Jecks, Susan Nabors and Lisa Dunn, and the engineer is Tobey Schreiner. Natalie Yuravlivker answers the phones. Visit drshow.org for audio archives, transcripts, podcasts and CD sales. Call 202-885-1200 for more information. Our email address is drshow@wamu.org, and we're on Facebook and Twitter. This program comes to you from American University in Washington. This is NPR.
Transcripts of WAMU programs are available for personal use. Transcripts are provided "As Is" without warranties of any kind, either express or implied. WAMU does not warrant that the transcript is error-free. For all WAMU programs, the broadcast audio should be considered the authoritative version. Transcripts are owned by WAMU 88.5 FM American University Radio and are protected by laws in both the United States and international law. You may not sell or modify transcripts or reproduce, display, distribute, or otherwise use the transcript, in whole or in part, in any way for any public or commercial purpose without the express written permission of WAMU. All requests for uses beyond personal and noncommercial use should be referred to (202) 885-1200.

Our address has changed!

The Diane Rehm Show is produced by member-supported WAMU 88.5 in Washington DC.