Why is administration helping companies avoid restrictions on bailout money?

A summary of what's in the major U.S. newspapers.
April 4 2009 6:27 AM

No Strings Attached

The Washington Post leads with word that the White House is quietly working to help companies circumvent restrictions on federal bailout money. The New York Times leads with the unemployment rate hitting 8.5 percent nationwide, the highest level in more than 25 years. The Los Angeles Times leads with a gunman killing 13 people and wounding four others at an immigration-services center in Binghamton, N.Y., before taking his own life. The Wall Street Journal leads with reports that President Barack Obama is planning to lift some restrictions on travel to Cuba.

The White House says it doesn't think companies will accept federal bailout money if the cash comes with restrictions, such as limits on executive pay. In order to get around the strings put in place by Congress, the White House is planning to distribute bailout money to shell companies, which will then hand it over to the intended recipients. The paper says most members of Congress had no idea this was happening, although it doesn't look like there's much lawmakers could have done about the situation in any case. Some legal experts are convinced, however, that these financial end-runs won't hold up in court.

The economy shed 663,000 jobs last month, dimming hopes that the economy might be starting to turn around. In January, Obama said he thought unemployment would hit 8.9 percent by year's end, a target that now seems to be within easy reach. The NYT mentions that some experts are now calling for a second stimulus package to account for the deepening recession. The LAT's analysis is a just little more positive, noting patches of good news like increased consumer spending and orders for manufactured goods. The WSJ points out that many analysts actually expected unemployment numbers to be much worse. The WP just teases its economic coverage above the fold.

At about 10:30 a.m. yesterday, a 42-year-old Vietnamese immigrant reportedly barricaded the back door of the American Civic Association in Binghamton. He then walked around to the front door, opened fire without warning and held 37 survivors hostage for three hours before apparently killing himself. The LAT's coverage has more background information on the shooter, a man identified as both Jiverly Voong and Jiverly Wong. The shooter is known to have ties to the ACA center, but none of the papers can establish a motive for the shootings. The NYT focuses on constructing a narrative, building a nearly blow-by-blow account of the rampage.

Americans with family living in Cuba will be able to travel freely to the island nation once Obama rescinds certain travel restrictions. They will also be allowed to send unlimited funds to relatives living there. Obama cannot lift the trade embargo against Cuba by himself, and the White House says he has no plans to ask Congress to do so. The WSJ also reports that no specific diplomatic actions are planned between the U.S. and Cuba.

The NYT and the LAT both front their coverage of an Iowa Supreme Court decision that will allow the state's same-sex couples to marry. Iowa is the third state to legalize gay marriage through its court system but is the first Midwestern state to do so. The court ruled unanimously that a law defining marriage as being between one man and one woman violates the equal protection clause of the state's constitution. The LAT notes that the decision may help gay rights advocates in California overturn the gay marriage ban known as Proposition 8. The WP teases its Iowa decision coverage under the fold.

Defense Secretary Robert Gates is planning to announce cost-saving overhauls of several major defense programs, according to the WP's off-lead story. Five months ago, Pentagon officials tried to get the new administration to lock into a 14 percent Defense spending increase. The administration balked at the request, and now Gates finds himself in the unenviable position of trying to pry funds loose from Pentagon projects. The paper says that nothing is set in stone just yet, but the Army's long-troubled Future Combat Systems project is expected to see major cuts. Other items that may get scaled back include aircraft carriers, a communications satellite program, and elements of missile-defense plans that aren't living up to expectations.

Congressional Democrats agree with Obama's budget priorities, but they're concerned about the pace of his agenda, writes the LAT. The paper reports that the language used in the recently passed budget resolution shows that lawmakers are worried that the administration will try to do too much too quickly, incurring significant political costs for vulnerable members. The paper says lawmakers are at an impasse, unable to deny Obama but not able to fully endorse his plans either.

The WP fronts its coverage of Obama's meetings with European leaders on the 60th anniversary of NATO's founding. Obama has been lobbying Europe's leadership to aid the United States in pursuing a new military strategy in Afghanistan and Pakistan. While leaders like French President Nicolas Sarkozy and German Chancellor Angela Merkel have expressed admiration for Obama's plans, they've backed away from any sort of commitment to send more troops. Instead, Sarkozy says France will accept custody of a prisoner from the Guantanamo Bay detention facility.

South Carolina Gov. Mark Sanford will finally accept federal stimulus money, reports the NYT. The paper says Sanford's original refusal to accept the money raised his profile among Republicans nationwide, but it also angered many of his constituents back home.

When a company wants to give a product street cred, a graffiti artist named Mister Cartoon is one of the first people they call, says the LAT.  The interesting thing about the profile is that Cartoon's story isn't the kind of overnight, rags-to-riches script that usually gets tacked onto urban artists who gain a corporate following. This is a story about a guy who aggressively cultivated a personal brand that's been building steam for 15 years.

Inside, the WP notes that federally controlled mortgage giants Fannie Mae and Freddie Mac will pay $210 million in bonuses to 7,600 employees over the next 18 months.

Just in time for Passover, the LAT reports on the booming market for kosher alcoholic beverages. Now observant Jews can have their tequila and keep their dietary laws, too.

Just an FYI: If you're looking for a new business name, anything with the word monster in it is already taken. The WSJ explores how an audio-cable company managed to vigorously defend its 70-plus trademarks on a fairly common word.

Google's plan to make millions of orphaned books available online has some academics and public interest groups up in arms, according to the NYT. Critics say that a settlement between Google and authors and publishers grants the company too much power over a valuable and diverse body of work.

The LAT runs a feature on the tradition of folding palm branches into intricate works of art for Palm Sunday.

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