By Daniel Politi
The New York Times leads with Secretary of State Hillary Clinton’s announcement that the White House will be sending two senior officials to Syria this weekend. The move is seen as a first step in the Obama administration’s expected effort to revive relations with a key player in the Middle East that hasn’t had a U.S. ambassador for more than four years. The Washington Post leads with the administration’s efforts to boost confidence in the economy as well as the government’s moves to tackle the ongoing crisis. A day after the stock markets reached new lows, White House officials seemed to be on a mission to instill hope in the American people that things will get better as the Federal Reserve and the Treasury Department launched a program to finance new lending for consumers and businesses.
All the optimistic talk in the world couldn’t stop more grim statistics from coming down the pipeline. USA Today leads with news that automakers had a horrible February. Many thought it couldn’t get any worse than January, but last month sales were down 41.4 percent. If the rate expands throughout the whole year it would translate into a mere 9.1 million new sales, the worst number since 1981. The Wall Street Journal‘s world-wide newsbox leads with a new poll that shows Americans are overwhelmingly supportive of President Obama and his agenda. Although 70 percent are very dissatisfied with the economy, Obama still enjoys a 60 percent approval rating and around two-thirds of American say they feel “hopeful” about his presidency. Most surprising is that 41 percent of Americans say the country is headed in the right direction, a huge increase from the 26 percent who said the same thing in mid-January. The Los Angeles Times leads with local elections. Los Angeles Mayor Antonio Villaraigosa was re-elected and will serve a second four-year term.
The NYT says the move to quickly send envoys to Syria suggests the Obama administration sees the country as a potential “key” to “tackle three interlocking challenges in the Middle East: the nuclear threat posed by Iran; long-simmering tensions between Israel and Syria; and the grinding conflict between Israelis and Palestinians.” The WSJ emphasizes that improving relations with Syria is part of the effort to isolate Iran. Improving relations with Syria could pressure Iran to accept direct talks with the United States and might push Arab states to negotiate with Israel. White House officials also hope that it could help reduce the number of weapons that flow into regional hotspots, including Iraq. Clinton announced the move during a visit to Jerusalem, where Iran was one of the main topics of discussion with Israeli leaders.
The hopeful talk on the economy came from multiple officials yesterday. Even Obama got into it and “made his first direct attempt to boost equity prices,” as the WSJ puts it. After weeks of talking about the poor state of the economy he inherited, Obama abruptly shifted yesterday and noted that we might be at a point where “buying stocks is a potentially good deal if you’ve got a long-term perspective on it.” Obama also told Americans to not read too much into the stock market, which he compared to a political tracking poll. “You know, it bobs up and down day to day,” he said. “And if you spend all your time worrying about that, then you’re probably going to get the long-term strategy wrong.” The WSJ notes that it is “dicey for a president to talk about stock prices” but it seems the White House has taken the view that no matter how much they try to prop up the economy, all of it will fail if Americans remain pessimistic.
In testimony before the Senate budget committee, Federal Reserve Chairman Ben Bernanke emphasized the need for the government to keep on working to stabilize the financial markets. The WP notes that he “offered a more mixed assessment of the potential impact of stimulus” but the NYT homes in on how it looked like he was tacitly endorsing Obama’s plans to increase spending. Of course, Bernanke didn’t come out and express support for any specific proposals but he may have provided Democratic lawmakers with some important ammo. The NYT notes that his comments “were reminiscent” of the support that former Fed Chairman Alan Greenspan gave to President Bush’s tax cuts, which many think was instrumental in defeating Democratic opposition to the plan.
The WSJ points out that Bernanke abandoned his typical “sober and professional demeanor” when he talked about how the Fed “really had no choice” but to bail out American International Group. “If there’s a single episode in this entire 18 months that has made me more angry, I can’t think of one,” he told lawmakers. “AIG exploited a huge gap in the regulatory system.”
The WSJ did some digging and discovered that a group of top Merrill Lynch executives made a pretty penny last year, even though the company’s net loss was a whopping $27.6 billion. Last year, 11 top executives were paid more than $10 million in cash and stock, including one investment banker who received $33.8 million. In addition, 149 employees received $3 million or more. Of course, the stock awards are not worth as much today but the figures still show how Merrill wasn’t shy about maintaining the high compensations despite the company’s woes. In fact, the 10 highest-paid employees got a total of $209 million in 2008, an increase of $8 million from a year earlier. Some of the top earners ran units that managed to do well, but not all. One executive was paid around $13 million even though he was in charge of a unit that had a negative net revenue of $35.96 billion. New York Attorney General Andrew Cuomo is seeking information about Merrill’s highest-paid employees as part of his investigation into the $3.6 billion in bonuses that the company paid out before it was taken over by Bank of America.
In an almost too-unbelievable-to-be-true story, the NYT points out that a dozen former top executives of Countrywide Financial, the company that many saw as the very definition of a predatory lender before it was bought by Bank of America, are making money off the mortgage crisis. These former executives have been snapping up “delinquent home mortgages that the government took over from other failed banks, sometimes for pennies on the dollar,” explains the paper. Business at PennyMac is “off-the-charts good,” explained one company executive. The executives contend their company is a prime example of how the government can work with the private sector to help struggling homeowners. And it seems they have, in fact, helped some people stay in their homes. But some think the whole thing is extremely troubling. “It is sort of like the arsonist who sets fire to the house and then buys up the charred remains and resells it,” a lawyer at the National Consumer Law Center said.
The LAT and WP both front prime examples of how newspaper investigations can help justice along. The WP fronts news that a 27-year-old Salvadoran man will be charged with the killing of Chandra Levy, the 24-year-old intern who disappeared eight years ago and garnered international attention due to her affair with her congressman, Gary Condit. Last summer, the WP published a 13-part series that detailed how the police had made many mistakes as they focused much of their attention on Condit and failed to fully investigate a man who had attacked other women in Rock Creek Park. For its part, the LAT fronts news that a federal magistrate judge in Los Angeles declared that a man who is serving a life sentence for the 1983 killing of his mother was wrongfully convicted and should either face a new trial or be set free. In his report, the judge makes many of the same arguments that the LAT presented in a story published in 2005 that was the result of a seven-month investigation.
The NYT takes a look at how dead people have become “the new frontier in debt collecting” and make up “one of the healthiest parts of the industry.” An increasing number of companies are taking advantage of improved technology to recover debts that dead people left behind. Debt collectors could go after assets, but when there is no money to speak of, they often ask surviving relatives to pay up. Usually, these relatives are under no obligation to pay but it seems obvious that many of those who receive the calls don’t know that. One consultant even makes it seem as though collectors are doing the dead debtors a favor by getting their relatives to fork over the cash. “[W]e want the dead to rest easy, knowing their obligations are taken care of.”