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Federal News Digest — August 8, 2011

Washington Post

Despite pledges from world leaders, global markets continue to fall – Zachary A. Goldfarb reports on the continuing fallout from Standard and Poor’s downgrading of the U.S. credit rating and the European debt crisis – a drop in European and Asian stock markets; meanwhile Federal Reserve Chairman Ben S. Bernanke and Treasury Secretary Timothy F. Geithner, who blasted S&P’s decision, tried to calm European leaders’ concerns over the weekend

Geithner tells Obama he will remain as Treasury secretary – Zachary A. Goldfarb reports that Treasury Secretary Geithner, the only original member of the president’s economic team, who had planned to leave his post after the debt ceiling deal, has been persuaded to stay on through 2012 to deal with the latest economic crisis

U.S. to grant waivers for No Child Left Behind – Lyndsey Layton reports that Education Secretary Arne Duncan announced that the administration will waive federal requirements for states that cannot meet increasingly higher education standards of the federal law; the administration has tried unsuccessfully to get Congress to reform the law

Immigration authority terminates Secure Communities agreements – Tara Bahrampour reports that the Immigration and Customs Enforcement agency is terminating agreements with states for its controversial program that allows the FBI to share fingerprint data of locally arrested people with federal authorities, for use in checking immigration law violations; participation is not voluntary and jurisdiction is now being given fully to the federal government

Treasury Internet push may speed $532 billion to U.S. vendors – Nishad Majmudar reports that the Treasury Dept. is requiring its contractors to provide invoices online by 2013 and estimates that the government could save $450 million per year if all government agencies followed suit; the Departments of Defense, Interior, and Agriculture already use online invoicing

New York Times

S&P downgrade is seen as adding urgency to debt-cutting panel – Robert Pear reflects on one up-side of S&P’s downgrading of U.S. credit – greater motivation for the congressional “super committee,” created as part of the debt ceiling and deficit reduction deal, to reach an agreement on reducing the deficit by at least 1.5 trillion

Don’t gut the S.E.C. – Arthur Levitt Jr., a former chairman of the Securities and Exchange Commission, argues that congressional proposals to change the S.E.C.’s structure and to require the that agency apply cost-benefit analyses to regulations would undermine the S.E.C.’s independence; Levitt also chides Congress for its unwillingness to provide funds for the agency’s additional responsibilities under the Dodd-Frank financial reform law

Wall Street Journal

Obama and S&P vie for credibility – Damian Paletta, Carol E. Lee, and Jeannette Neumann report on the duel of words between the administration and Standard and Poors following S&P’s downgrading of U.S. credit from AAA to AA plus, leaving investors to decide which one’s view of the country’s ability to pay its debts is more accurate

Subpoenas go out to high-speed trade firms – Jenny Strasburg and Jean Eaglesham report on the latest developments in the Securities and Exchange Commission and the Commodity Futures Trading Commission’s investigations of last year’s “flash crash,” in which the Dow Jones Industrial Average dropped 700 points in minutes, and related “high-frequency” trading practices

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