WASHINGTON  – The White House says Treasury Secretary Timothy Geithner (GITE-nur) will visit Capitol Hill on Thursday to start outlining President Barack Obama’s plans to update financial regulations.

White House spokesman Robert Gibbs said Monday the administration hopes to have regulatory legislation in place by the end of the year. Gibbs says those regulations are important to help stabilize the global market.

When asked about the White House’s timetable for outlining its plan for financial regulations, Gibbs announced Geithner’s testimony.

Gibbs says he isn’t sure if Geithner would testify in the House or Senate. Geithner faces critics in both chambers.

By SEAN MUSSENDEN
Media General News Service

WASHINGTON—President Barack Obama’s picks to fill the top two positions at the Food and Drug Administration have repeatedly bucked tobacco companies and pushed for greater restrictions on cigarette marketing, second-hand smoke and sales to minors.

Though the FDA does not currently regulate tobacco products, Congress is moving ahead on long-stalled legislation to give the agency oversight of cigarette companies.

That could give Obama’s choice to lead the agency, Dr. Margaret Hamburg, and her top deputy, Dr. Joshua Sharfstein, great sway over the industry.

As New York City’s heath commissioner in the 1990s, Hamburg fought for a total ban on indoor smoking in public places long before states and cities began adopting such aggressive restrictions.

And as health commissioner in Baltimore, Sharfstein pushed through an indoor smoking ban in the city that paved the way for a similar statewide ban.

Neither Hamburg nor Sharfstein have publicly signaled their intentions regarding tobacco oversight since being tapped for the posts.

Hamburg couldn’t be reached for comment and Sharfstein declined to comment through a spokesperson at the Baltimore health department. 

 Obama reiterated this month that he supports giving the FDA oversight of tobacco.

And on Wednesday, a key House committee approved a bill sponsored by Rep. Henry Waxman, R-Calif., that would do just that. The full House is expected to give its approval soon.

In the Senate, where the measure failed to pass last year, supporters of the FDA plan believe they have the votes to pass it in that chamber this year.  But Sen. Richard Burr, R-N.C., and Sen. Kay Hagan, D-N.C., have proposed an alternate plan to create a new federal agency to regulate tobacco that could again stall the FDA proposal.

Because the Waxman legislation would give agency officials flexibility to develop new cigarette warning label standards and marketing restrictions, anti-tobacco groups said it was important for Obama to have nominated people who have worked to reduce smoking rates.             

“The buzz has all been very positive,” Kathleen Dachille, director of the Center for Tobacco Regulation at the University of Maryland Law School, said of Hamburg and Sharfstein.

Dachille worked closely with Sharfstein to enact stricter smoking regulations after he was tapped to lead the city department in 2005. 

He was the leading advocate to ban smoking in all workplaces in Baltimore – restaurants and bars included – and fought hard for a similar statewide ban.  

The proposal stalled at the state level because of resistance from tobacco companies and the restaurant lobby. After Baltimore passed its own ban in 2007, opposition to a statewide ban dwindled.     

“Baltimore was a major tipping point, and he was able to accomplish that.  It was the key jurisdiction that opened the door to statewide legislation,” Dachille said.

Last year, Sharfstein also pushed to ban sales of single small cigars – brands like Black and Mild and Swisher Sweets – after a health department investigation found the inexpensive smokes were popular with inner city minors. 

While some young people couldn’t afford to buy a pack of cigarettes for $5, the investigation found they could easily scrape together enough change to buy a single small cigar that sold for less than $1.     

When the state legislature did not pass a restriction that would have required Maryland retailers to sell the cigars in packs of five or larger, Sharfstein issued his own five per pack minimum requirement in Baltimore, which became the first city to do so. 

The measure was opposed by R.J. Reynolds Tobacco Co., Philip Morris and other tobacco companies, who threatened to fight the new restriction in court.

Before joining the Baltimore health department, Sharfstein worked on tobacco policy issues including FDA regulation as an investigator for Waxman, then the chair of the House Oversight and Government Reform Committee.

In 2003, he helped write an investigative report that concluded that Philip Morris continued to lie about control of nicotine levels in its cigarettes and that R.J. Reynolds was not being truthful about marketing to minors.  

As New York City health commissioner in the early 1990s, Hamburg fought successfully to ban cigarette advertisements on city subways. 

In the mid-1990s, New York banned smoking in most restaurants.  At the time, few states and cities had taken that step, but Hamburg wanted the city to go even further. 

At the time, she backed a total indoor workplace smoking ban, something the state and city did not enact until 2003.

“In many respects, she was ahead of her times,” said Matthew Myers, president of Campaign for Tobacco-Free Kids, an anti-tobacco group.   “She has a demonstrated track record of working to reduce tobacco use that will hold her in good stead if Congress grants the FDA jurisdiction.”

A spokeswoman for R.J. Reynolds declined to comment on how Hamburg’s views on smoking could affect the company.

“The real issue is whether the Food and Drug Administration is going to be able to appropriately regulate tobacco, given that it is by all appearances too overburden to meet its current obligations monitoring food and drugs,” said spokeswoman Maura Payne.

Sean Mussenden can be reached at smussenden@mediageneral.com or 202-662-7668.

CHICAGO – Nearing completion of his Cabinet, Barack Obama has selected California Rep. Hilda Solis as his labor secretary and former Dallas mayor Ron Kirk as U.S. trade representative, officials said Thursday.

The president-elect planned to formally announce the Solis and Kirk selections soon, perhaps as early as Friday, along with that of Republican Rep. Ray LaHood of Illinois for transportation secretary.

On Thursday, Obama named three veteran regulators to help clean up financial debacles. Amid a year-old recession that’s still deepening, Obama blamed much of the nation’s economic troubles on government regulators who “dropped the ball,” and he called for a return to ethics and tough enforcement.

The officials who disclosed the Solis and Kirk selections spoke on the condition of anonymity because they were not authorized to discuss selections that had not yet been announced.

Solis, a Democratic congresswoman who is the daughter of Mexican and Nicaraguan immigrants, has focused on immigration and environment issues while in the House. Kirk, a partner in the Dallas office of the Houston-based powerhouse law and lobbying firm Vinson & Elkins, was the first black to be elected Dallas mayor.

Obama is trying to get most of his major appointments out of the way before heading to Hawaii for a holiday vacation, and has held a news conference each day this week to unveil top positions. He has yet to announce senior intelligence positions, and numerous sub-Cabinet posts remain unfilled.

Standing before reporters on Thursday, Obama named Securities and Exchange Commission veteran Mary Schapiro as chairwoman of that agency, former Treasury official Gary Gensler to head the Commodity Futures Trading Commission, and law professor Daniel Tarullo to fill an empty Federal Reserve seat. All three will need to be confirmed by the Senate next year.
 
In making the announcements, Obama pointed to Wall Street money manager Bernard Madoff, under investigation in an alleged $50 billion fraud, and said the scandal underscored the need for tougher regulators. The scandal “has reminded us yet again of how badly reform is needed,” he said.

The president-elect said his new team will help put in place new rules that will help “crack down on the culture of greed and scheming.”

“There needs to be a shift in ethics on Wall Street,” he said.

As Obama spoke in Chicago, the White House said it is considering “orderly” bankruptcy as a way of dealing with the desperately ailing U.S. auto industry. President George W. Bush, asked about an auto rescue plan during an appearance before a private group, said he hadn’t decided what he would do but also spoke of the idea of bankruptcies organized by the federal government as a possible way to go.

Obama did not immediately comment on the idea.

But he wouldn’t weigh in on whether he would support a decision by Treasury Secretary Henry Paulson to tap the second $350 billion installment of the $700 billion financial bailout program. Major auto companies are pleading for emergency aid, which could come from that pot.

“I think it’s important that the Treasury, the Fed and all of us do whatever’s required to make sure that our financial system is stable and secure,” Obama said. But he added: “We cannot afford a collapse of our financial system. Main Street can’t afford it.” He said he would evaluate any Paulson signals about what is necessary.

More broadly, Obama blamed regulators for the financial debacle, saying that they, along with congressional committees, “have been asleep at the switch.”

Americans, as they watch their investments tank, are frustrated that “there’s not a lot of adult supervision out there,” Obama added.

Schapiro, who would be Obama’s top Wall Street regulator and investor protector, said that investor trust “is the lifeblood of financial markets.” She called for tough enforcement action by incoming regulators.

If confirmed by the Senate:
      -Schapiro, who served as an SEC commissioner in Republican and Democratic administrations and is currently the head of the Financial Industry Regulatory Authority, would take over an agency that faces growing criticism for its failure to protect investors and detect trouble brewing on Wall Street.

As the scandal involving Madoff continues to stun the financial world, revelations have surfaced that staff at the SEC repeatedly failed over the course of a decade to fully investigate credible allegations against him. SEC Chairman Christopher Cox on Tuesday ordered the agency’s inspector general to investigate what went wrong.
      -Gensler, a former Treasury official in the Clinton administration, would lead the Commodity Futures Trading Commission, which is an independent agency created by Congress to regulate trading in the commodity futures and option markets.
      -Tarullo, a Georgetown law professor who also worked for President Bill Clinton, would fill an open seat on the Federal Reserve board in Washington.
 
All the present Fed board members, including chairman Ben Bernanke, were picked by Bush. Tarullo would fill one of two vacant seats on the seven-member board. A third seat also will become available.

WASHINGTON – Wanted: Democratic congressional aide seeking new career. Must have strong powers of persuasion, excellent connections and good marksmanship. Contact the National Rifle Association’s government affairs office for details.

It’s clear times have changed in Washington when the nation’s biggest gun-rights lobby – long considered Republican-leaning – points out the Democrats on its team and only half-jokingly talks about hiring more.

“We’re always looking for good ones,” NRA executive vice president Wayne LaPierre said when asked if he’s seeing Democratic staffers leaving Capitol Hill to fill a growing demand for Democratic lobbyists. “If they do, give us a call.”

The Democrats’ election sweep – they gained the White House and increased their majorities in the House and Senate – is shaking up the capital’s $3 billion-a-year lobbying industry. After eight years of a Republican administration and shifting power in Congress, Washington’s 16,000 registered lobbyists must now work to capitalize on, or cope with, one-party control.

“We look at any new administration as a time of opportunity in the lobbying community, and certainly here,” said Gregg Hartley, vice chairman and CEO of the bipartisan lobbying firm Cassidy & Associates. He said he would love to see an influx of applications from Democratic aides. “We have shopped to add very high quality, strong individuals, but they are enjoying being in the new majority.”

Jim Albertine, a longtime Washington lobbyist and former president of the American League of Lobbyists, said there’s no question that lobbying firms will load up with Democrats, if they haven’t already.

“Having said that, however, with the new lobby rules, no matter if you come from D or R, you’re still going to be restricted in what you’re doing in the first year,” Albertine said. That could give established lobbyists an edge over newcomers from Capitol Hill: As the new administration moves on its agenda, “if you have a new hire, you’re not going to be able to use that person in the way you want to,” he said.

Many lobbyists began positioning themselves before the election. President-elect Barack Obama’s stated antipathy toward lobbyists may keep many of them from winning high-profile posts in his administration, but it hasn’t kept them from promoting their policy positions to Obama’s team.

The American Farm Bureau Federation, like most major trade groups, tries to keep a bipartisan balance. It has staff members who worked and volunteered in the campaigns of Obama and his

Republican rival, Sen. John McCain. The federation and its state farm bureaus already are talking to Obama’s transition team about its priorities, including energy production, trade and how government carries out the new farm bill, chief lobbyist Mark Maslyn said.

“It starts long before this moment. And many of the people we have known for years and years,” Maslyn said. “Because we regularly work with both sides of the aisle, we work with lawmakers who want to see those positions advance as well: members of the Democratic caucus as well as the Republican caucus. As I tell a lot of people, this is a relational business.”

Likewise, the Edison Electric Institute, a lobbying group for electric utilities, talked with both campaigns and already has been in touch with Obama’s transition team. Issues it is trying to get on the Obama team’s radar include the need for more power lines.

Offering a glimpse of how the institute may promote that, spokesman Jim Owen said the group sees renewable energy as a way to create the kind of “green jobs” Obama championed during the campaign. To use the renewable energy that utilities generate, transmission lines are needed to connect it to the power grid, he said.

The Financial Services Roundtable is engaging in a postelection full-court press.

“We’re talking with lawmakers, Treasury and the transition team,” said Scott E. Talbott, vice president of government affairs. Its concerns include the $700 billion bailout administered by the Treasury Department and “overtightening” existing restrictions or creating new ones. Congress has talked about restrictions on paying dividends and bonuses, and on lobbying.

Though seldom willing to name names, lobbyists are weighing in on potential Obama appointees, in some cases describing the kinds of people they would like to see in key jobs or going so far as offering to help recruit and vet candidates.

Key posts for the Farm Bureau include the agriculture and energy secretaries, Environmental Protection Agency administrator, U.S. trade representative and second- and third-tier appointments, the “sub-Cabinet” positions such as deputy secretaries and deputy administrators, assistant administrators and undersecretaries that tend to be the point people and experts on specific industry issues.

Top lobbying goals for the American Association for Justice, formerly the Association of Trial Lawyers of America, include asking the Obama administration to undo any rules the outgoing Bush administration adopts to try to limit lawsuits. It wants Congress and Obama to outlaw mandatory binding arbitration in consumer contracts and reverse a Supreme Court decision making it harder for consumers to sue the makers of FDA-regulated medical devices.

The American Medical Association’s Washington office communicated with both presidential campaigns and now is talking to Obama’s transition team about key issues such as Medicare reimbursement, preventive health care and the uninsured, said its incoming president, Dr. Jim Rohack, a physician in Temple, Texas.

Though Democrats control Congress, AMA lobbyists won’t ignore Republicans, Rohack said, noting that Senate Democrats lack a filibuster-proof 60 votes. The Financial Services Roundtable plans to do the same.

Some lobbyists are now seeing people they worked with in government years ago back in positions of power. Dan Glickman, chief executive of the Motion Picture Association of America, was agriculture secretary under President Bill Clinton, whose administration is being tapped by Obama for expertise as he prepares to take office.

Others are not so well-positioned with Obama’s team, and are making their views known through other channels.

The NRA, which endorsed McCain, is lobbying sympathetic congressional Democrats to try to head off any move toward new gun controls. When it comes to lobbying Obama’s transition team, “we’re talking to whoever we know who talks to them,” LaPierre said.

The current climate will make it difficult for new Republican lobbyists, but could prove lucrative for those who represent business.

Wright Andrews, a former Democratic congressional aide who lobbies on banking issues, said the power shift will require Republican lobbyists to hunker down, working at the margins of legislation to make modest changes and forming coalitions between GOP lawmakers and conservative Democrats to play a more defensive game.

“We are looking at more government regulation,” Andrews said.

“I would certainly expect that after many people see the new administration’s agendas and proposals, they will come clamoring to K Street, saying, ‘Save us.’ You will see business interests socked like they haven’t been in a long time.”