Christopher Conkey and Cam Simpson of the Wall Street Journal report that Barack Obama has pledged to reduce the role of government contractors but that his ten-year budget plan contains few specifics of how to actually do this. Conkey and Simpson are right — the heavy lifting in cutting public reliance on the private sector starts at the Pentagon and the Obama administration has yet to lay out what pricey weapons programs (often given to private companies without a competitive bidding process) will go.

But Obama’s stance on contractors is a clean break from past administrations. Money to contractors meteorically increased from $208 billion a year in 2000 to $423 billion in 2006 under the Bush administration. But the Bill Clinton administration was, to a lesser extent, also gung ho about privatizing new areas of government like information technology services and parts of the U.S. intervention in Kosovo. Reversing this trend is a significant part of an Obama budget that shows faith in the ability of government to work.-MB

"The Obama administration moved Friday to undo a last-minute Bush administration rule granting broad protections to health workers who refuse to take part in abortions or provide other health care that goes against their consciences," reports David Stout of the New York Times. "Considerable emotion surrounds the issue, as illustrated by the shorthand used to describe the rule. Supporters called it the “provider conscience regulation,” while the Planned Parenthood Federation of America disdained it as a “midnight regulation.”

These supporters may be right, depending on your view of how much personal latitude health care providers should enjoy. But the Planned Parenthood position here is unassailable: it was a midnight regulation, put into place during the dead pre-Christmas reporting cycle, right between the election and inauguration of Obama. Not surprisingly, Health and Human Services officials are uncertain about the ramifications the regulation has: Will it allow drugstore employees to not fill out prescriptions for contraceptives? Does it end the requirement that hospitals provide emergency contraceptive to rape victims?

Regardless, of you where stand in the abortion debate this was irresponsible governing by the Bush administration: Why did they wait eight years to make this rule? Obama’s HHS is right to, at the very least, call for a fresh review of the regulation.-MB

Jane Mayer of the New Yorker reports that the Justice Dept. has indicted Ali Saleh Kahlah al-Marri in Illinois this afternoon for material support of terrorism. The alleged al Qaeda associate is the lone remaining "enemy combatant" who has been detained infeinitely on U.S. soil: Marri has spent the past five years on a Naval brig in Charleston, South Carolina.

Human rights groups are applauding the move: after all the Obama administration is showing they have faith in the criminal justice system and don’t need extra-legal practices to handle Marri. I’m not so sure, though, whether it’s such a noble move. The Supreme Court was going to hear Marri’s case and now they likely won’t. The Supreme Court could have made a sweeping decision that might have put an end to criminal justice systems like military commissions or the very practice of indefinite detention.

Now, though, the Obama administration can deal with Guanatanamo detainees in extra-legal ways. It’s good that Marri is being placed in the criminal justice system but it’s hardly a harbinger of just actions to come.-MB

Barack Obama formally announced his plan to withdraw troops from Iraq today: all combat forces out by Aug. 31, 2010 and all troops out period by the end of 2011. The New York Times‘ Peter Baker writes: "the announcement marked a sharp turning point in the American venture in Iraq, one that signaled a shift in the once-fiery political debate at home and in the nation’s priorities abroad."

I don’t think that’s true. The announcement marks a general continuation of Bush administration policies, namely the status of forces agreement that all troops must leave Iraq by 2011. Obama occupies here a right-center position on the political spectrum, going along with the wishes of holdover Defense Secretary Robert Gates, not Democrats dismayed that "withdrawal" actually means a residual force presence of 50,000 troops betwee mid-2010 and the end of 2011. Also, the fire has been extinguished from the Iraq debate for almost a year: there are more U.S. deaths in Afghanistan, the Bush administration began instituting a more pragmatic policy toward Iraq, and the recession has put every other political issue on the backburner, even matters of war and peace.

That’s not to say that Obama is making a bad decision here. Let’s just make clear he’s yet to take foreign policy in a new direction.-MB

Brass from General Motors and Chrysler met with the Obama administration auto task force for six hours yesterday to discuss how in the world to save the companies. I don’t know if GM and Chrysler should be rescued, but a compelling argument in favor is that the auto manufacturers shouldn’t be penalized for looking after their worker’s health. Peter Whoriskey and Kendra Marr of the Washington Post write that GM and  Chrysler have a combined $30 billion in obligations to retirees’ health plans (a figure greater than 40 percent of the company’s combined 2007 sales). If the auto giants were to collapse, it’s not known if the health benefits of 800,000 retirees would also go out the window.

There is much written about how inefficient GM and Chrysler have been, but part of that "inefficiency" is the investment the automakers have made in their employees’ health. After pitching in $11 a month, United Auto Worker-represented employees get a full retiree health care package — "medical, dental, vision and prescription drug coverage." This is unusual:

As recently as two decades ago, most large American companies that offered health insurance extended coverage to retirees. In 1988, for instance, 66 percent of such employers offered retiree health benefits. But that figure has steadily dropped, and today only about 31 percent of those large employers do, according to a survey by the Kaiser Family Foundation and Health Research and Educational Trust released in September.

Again, I don’t know if this is reason enough to bend over backwards for GM and Chrysler. But it’s good to be reminded that the auto companies are in financial trouble for reasons a bit less nefarious than playing the secondary subprime mortgage market. -MB

Like escalating a war that has no stated purpose, the Treasury Dept. ratcheted up its efforts today to save Citigroup from ruin. In its third attempt to save the mega-bank, Treasury will now own more of Citigroup, 36 percent, and also convert $25 billion in Citigroup preferred stock to common stock. The New York Times’ Eric Dash writes: "The deal is expected to serve as a model for other financial institutions. Other major banks could find themselves in a similar position if a new ’stress test’ shows they need more capital to cope with worsening losses."

But it’s not clear what model is being presented here besides Treasury’s desire to own as much as Citigroup as possible without "nationalizing." Dash concludes his story by saying that the deal "does little to address the bank’s underlying problem: Citigroup may not have the earnings power to weather the tsunami of consumer losses expected over the next several quarters. That is because tens of billions of toxic mortgage-related assets remain stuck on its balance sheet. Until they are removed, few private investors may be willing to pour new capital into the bank."

The original idea of Henry Paulson’s Wall Street bailout was for the government to buy these toxic assets. It wasn’t clear when Tim Geithner gave a sketch of his bank rescue plan if the Obama administration would return to this idea.-MB

I wrote a couple of day ago that there is no "day of reckoning" for Bush administration officials who authorized and performed "harsh interrogation procedures" against detained terrorist suspects. But Mark Mazetti of the New York Times reports on an encouraging step in the direction of accountability: the Senate intelligence committee wants to investigate CIA interrogation methods used since Sept. 11 and issue an unclassified report on what they found. The Senate committee may also expand its investigation to look at the role played by the Justice Dept. Office of Legal Counsel in approving these CIA methods.

The intelligence committee investigation is not seen as preventing Sen. Pat Leahy and other Democrats going forward with their idea of a broader "truth commission" to probe torture. Instead, the intelligence committee will ultimately focus on whether harsh interrogation methods actually work in extracting intelligence. Many career FBI, CIA and Pentagon officials have gone on the record saying torture is not only inhumane, but ineffective. If the Senate committee were to find this, what arguments would be left to defend the Bush administration?-MB

Barack Obama unveiled his ten-year budget plan today with implications for the government and the country that are, well, a little overwhelming for even the wonkiest of observers. Here are some quick thoughts — more over the next 10 years:

-The New York Times’s Jackie Calmes and Robert Pear lead with the projection that the national deficit will be an incomprehensible $1.75 trillion this year. It is supposed to decrease, though, to $433 billion by 2013 and then increase again to $712 billion in 2019.

Which raises the question: Why is the national deficit the headline issue when most economists agree it is a secondary matter during the recession?

Nonetheless, the deficit is a (slightly misleading) jumping off point for examining the hard budgetary choices Obama isn’t making. Every single cabinet-level agency will enjoy an increase in money for fiscal-year 2010 except Justice, Energy and Health and Human Services. And Energy and HHS already have billions coming from the stimulus package. This means cutting billions in useless Pentagon weapons programs is, at least for now, being deferred. A rollback for people getting more than $500,000 in farm subsidies is the only example the Times provides of a significant cost reduction. Sounds good, but farm subsidies, no matter how bad of a policy they might be, cost a fraction of, say the F-22 jet or a missile defense program that doesn’t work and isn’t needed.

- The Environmental Protection Agency gets a 34 percent increase in their budget, mainly to deal with enforcing Clean Water laws. Wow!

- The Washington Post’s Steve Vogel reports that one source of small cost savings are a reduced annual raise for civil servants. Federal employees will get a 2 percent raise and military gets a 2.9 percent raise. Both groups got 3.9 percent last year. This increases the problem of of public sector pay lagging further behind private sector pay (i.e. government contractors). But the clearer-than-the-light-of-day injustice here is why in the world service members deserve a higher raise than civilians.

- Republicans quickly attacked the tax increases on "average Amercians" even though Obama is only increasing the taxes on people making over $250,000 a year and (two years from now, if it can manage its way through Congress) and energy companies that emit dangerous levels of carbon. An early Republican tactic is claiming that the average Joe will incur these energy taxes, though my understanding is that they’re a direct tax on the company.

I’m sure everything will be sorted out by tomorrow. -MB

Elizabeth Bumiller of the New York Times reports that the Pentagon has ended its 18-year ban on letting the public and press take pictures of soldiers’ coffins. I haven’t read a rationale for why there should have been a ban in the first place: the Bush administration said it was about preserving the dignity of soldier’s families but now families will have a choice whether or not they want photos taken.

The Obama administration hasn’t layed out what it’s doing in Afghanistan or what will happen to Iraq after a summer 2010 withdrawal. But betweenaccounting for the wars in his proposed budget and the reversal on coffin photos, at least Obama acknowledges these wars have consequences.-MB

The Rocky Mountain News is closing its doors after more than 150 years of publication.  The Seattle Post-Intelligencer may cease to exist in less than two months.  The San Francisco Chronicle may very soon be gone.  And as Russell Adams notes in the Wall Street Journal,

what could be a string of major metropolitan U.S. markets to lose a major daily newspaper as an advertising slump ravages the industry amid the recession. Tumbling revenues at other newspaper groups have endangered one or more dailies in Philadelphia, San Francisco and Minneapolis.

Understanding Government is a non-profit organization devoted to better government through better reporting.  We are seeking support from major foundations and philanthropists to hire some of the great journalists who are losing their platforms at all these great American newspapers.  We want to hire reporters around the country to bring you stories about the federal government at a time when eyes on government are needed more than ever.

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Ned Hodgman