The Note, 12/02/08: Handoffs & Handouts

December 02, 2008 8:11 AM

By Rick Klein with Arnab Datta

You don't need a light-bulb moment for this one: Now that the national-security team is in place, it's all about the economy again for President-elect Barack Obama.

And, oh yeah -- he's pretty much the president now, by the way.

Partly it's the recession (finally official), partly it's the calendar, and partly it’s the particular situation of the outgoing president.

It's the flipside of the early appointments: Now that all the interesting jobs are filled, nothing much counts anymore other than action. And while Obama is in the unenviable position of not being in actual power for another seven weeks, he’s being pressed to act now.

(And his power will be judged -- at least in part -- in Georgia on Tuesday.)

If he needed proof that this is decision time, Obama and Vice-president-elect Joe Biden on Tuesday meet with a group that knows the urgency well: the nation’s governors, gathered in Philadelphia.

Meanwhile, in Washington, the automakers are submitting their plans for fiscal solvency -- this time, finding new ways of delivering their messages (and themselves) to Congress.

Look for a broad tone from Obama when he has a private chat Tuesday morning with governors of both parties -- a reiteration of his call for bipartisanship to meet big challenges -- but no further specifics on the size of any fiscal rescue package targeted to the states, per an Obama-Biden transition aide.

But his audience (which will include Gov. Sarah Palin, R-Alaska) is already looking beyond tone, to substance.

Per ABC's Matt Jaffe, a recovery package will be item one on the governors' minds: "For the governors, help for their states cannot come soon enough: 20 states have already cut over $7 billion from their 2009 budgets and 30 states expect additional short-falls totaling more than $30 billion."

Says a senior Obama transition official: "The main focus is the bipartisan meeting Tuesday. . . . The president-elect genuinely wants to hear the governors' concerns and act on that."

Get set for the pitch: "With their budgets bleeding red ink, the governors say they will argue that states are not just victims of the recession but also effective engines of economic recovery, capable of quickly delivering increased federal spending on infrastructure projects and social programs," Thomas Fitzgerald writes in the Philadelphia Inquirer.  "New Jersey's Gov. [Jon] Corzine told reporters yesterday that the governors' wish list could total $600 billion."

Is there anyone who doesn't want a bailout? 

"Pennsylvania Gov. Ed Rendell, who heads the National Governors Association, and Vermont Gov. James Douglas met with congressional leaders Monday to give them a preview of the association's proposal, which seeks at least $126 billion of federal funding to help states pay for rebuilding infrastructure, expanding social programs and extending unemployment benefits," The Wall Street Journal's Christopher Cooper and Brad Haynes report.

"When President-elect Barack Obama arrives at Philadelphia's Independence Hall today to meet with the nation's governors, the main question will be not whether he will deliver fast fiscal relief to the states, but how much?" Ceci Connolly writes in The Washington Post.  "As the economic downturn has swept from the housing market to financial institutions to the automobile industry, Obama has begun sketching out plans to address a recession that most experts project will be deep and long lasting. At the heart of his approach is a massive infusion of federal tax dollars."

"In a sign of the importance Obama is placing on relief to the states, the meeting with 40 current and newly elected governors will be his first trip outside Chicago since Election Day, with the exception of a brief visit to the White House," Connolly reports.

Even without a firm commitment from Obama, the governors have some important allies: "House Democrats said Monday that they would try to pass an economic recovery bill costing $400 billion to $500 billion next month as governors pressed Congress for money to build roads and bridges, provide health care to low-income people and develop alternative sources of energy," Robert Pear writes in The New York Times.

Then there's the Big Three, facing their Tuesday deadline to submit financial plans to Congress.

"GM will offer to cut debt, combine U.S. brands and pare costs while Ford will emphasize hastening a shift to cars from trucks, people familiar with the matter said. The United Auto Workers called an emergency meeting in Detroit tomorrow to consider concessions making it less expensive to eliminate jobs, people familiar with that session said," Bloomberg's Mike Ramsey and Jeff Green report.  "The presentations being given to Congress start a countdown to hearings on Dec. 4 and Dec. 5 and a vote on an aid package that may come next week."

"Chrysler plans to make the case that automakers can cut their costs and point to the future by forging an alliance to share fuel-efficient vehicle technologies," Kendra Marr writes in The Washington Post. “Ford will tell lawmakers that it intends to retool plants for smaller, more fuel-efficient cars as a part of its goal of becoming the fuel-efficiency leader in every vehicle category."

Will that be enough? (Will anything?)

"It was clear that when Detroit returns to Washington this week, their plans must do more than tally people they'll fire or pencils they won't buy -- they need to win hearts and minds. And quickly," USA Today's Sharon Silke Carty reports.

Optics matter: "Following the uproar over executives using corporate jets to ask for taxpayer money, Ford Chief Executive Officer Alan Mulally will make the 500-mile trip to hearings in Washington later this week in a Ford hybrid and may offer to take a pay cut," per the Detroit Free Press. "Spokespeople for GM and Chrysler declined to say how their executives will arrive in Washington, except to rule out a corporate jet."

"What's the chance it won't land in Obama's lap? "The House and Senate leadership is inclined to give the industry the full $25 billion it seeks. But a top congressional aide said it is not yet clear that a bailout that large has the votes to pass both houses, let alone get the backing of President Bush," E.J. Dionne Jr. reports in his column. "Plan B would involve passing enough assistance to keep the companies solvent until President-elect Barack Obama takes office."

Monday marked probably the last day where the transition team could count on names alone for headlines.

Of his team, a new tone: "Obama's choices signal a more pragmatic, less ideological approach to asserting American leadership in the world," per the AP's Robert Burns. "In announcing on Monday that Clinton is his choice for secretary of state and that Gates has agreed to remain as defense secretary -- with Jones as national security adviser in the White House -- Obama said he has intentionally surrounded himself with 'strong personalities and strong opinions.' And he made clear that when push comes to shove, he will be the one to make the tough calls." 

ABC's Jake Tapper and Matt Jaffe: "What seemed more new than the names involved, however, was the larger concept: The group drew from the camps of various political rivals Mr. Obama has faced including Secretary of Defense Robert Gates from the current president's administration; National Security Adviser-designee Gen. Jim Jones (Ret.), a friend of Sen. John McCain's of more than three decades; and Democratic primary opponent Sen. Hillary Clinton, D-NY, now his nominee to become Secretary of State."

"First, he dismantled the most impregnable political juggernaut in recent memory. Then Barack Obama managed the REALLY impossible: He transformed Hillary and Bill Clinton into subordinates," Thomas M. DeFrank writes in the New York Daily News.

Even Rush Limbaugh is impressed: "A brilliant stroke by Obama," El Rushbo tells ABC's Barbara Walters, for her "10 Most Fascinating People of 2008" special.  "You know the old phrase 'You keep your friends close and your enemies closer?' " Limbaugh asked. "He puts her over at secretary of state, how can she run for president in 2012? . . . Then she's got to run against the incumbent? And be critical of him, the one who made her secretary of state?"

Bob Shrum sees the test for Hillary: "For her part, Clinton must be -- and be seen to be -- genuinely comfortable yielding center stage to Obama, as she did at the Democratic Convention. She will also have to foreswear a shadow political operation, including poll briefings from her strategist Mark Penn, the salient points of which would no doubt find their way into the press."

From the Clinton foundation Tuesday morning: "Former President Clinton opened the Clinton Global Initiative (CGI) Asia meeting today, bringing together current and former heads of state and the region's leading figures from business and non-profit sectors to address some of the world's most pressing challenges."

Some lessons learned about Obama, per Politico's Jim VandeHei and Mike Allen: "He is willing to take big risks. . . . He is very focused on governing -- and prefers persuasion to force. . . . He isn't so disdainful of the 'Washington insiders' after all."

But how does he sell this to the base?

"Mr. Obama has long qualified his withdrawal pledge, but in the campaign the emphasis was on his intent to end the war. Now that he is taking office in 50 days, he is calibrating his statements to leave room to maneuver, knowing that some senior military officers are wary of moving too quickly and that the defense secretary he just reappointed has cautioned about timetables," Peter Baker writes in The New York Times. "The impression left by the event at a downtown Chicago hotel ballroom was of a political leader converting to governance from electioneering."

"It is troubling that a man of such good judgment has asked Robert Gates to stay on as Secretary of Defense -- and assembled a national security team of such narrow bandwidth," Katrina Vanden Heuvel writes for The Nation. "It is true that President Obama will set the policy. But this team makes it more difficult to seize the extraordinary opportunity Obama's election has offered to reengage the world and reset America's priorities."

The Chicago Tribune reports on the "centrist Washington insiders" now at Obama's side: "Even as Obama emphasized his plans for a break from Bush policy, however, there were abundant reminders that the new team will struggle with familiar problems, and that there would be substantial continuity in the way they must deal with them," Paul Richter, Christi Parsons and John McCormick report.

While he's selling new strategies: "A senior Obama aide said the incoming administration will create teams of diplomats and other civilian officials who can be quickly deployed overseas after natural disasters or political upheavals to help fragile countries get back on their feet," The Wall Street Journal's Yochi J. Dreazen reports.

And while he's managing new relationships: "Democrats familiar with the transition said the two have spent time over the past several weeks discussing the parameters of the job and how they would work together: Clinton received assurances that she would have the kind of access to Obama she needs, as well as the authority to pick her own team," Michael Abramowitz and Glenn Kessler report in The Washington Post.

Not coming on board: Los Angeles Mayor Antonio Villaraigosa.

"Villaraigosa said he had a 'conversation' with Obama in mid-November about joining the new Democratic administration but told the incoming president that he would stay in Los Angeles to focus on his reelection campaign and ongoing efforts to address the city's financial troubles and other pressing issues," Phil Willon reports in the Los Angeles Times.

In Georgia Tuesday, a test of political sway.

Palin inserted herself in the race just enough to claim credit if Sen. Saxby Chambliss, R-Ga., wins reelection, while Obama stayed just far enough away (maybe) to avoid suffering if Democrat Jim Martin doesn't pull off the upset.

"The former University of Georgia Sigma Chi fraternity brothers face off today in a nationally watched overtime election that could tilt the balance of power in the world’s most powerful deliberative body," Jim Tharpe and Aaron Gould Sheinin report in the Atlanta Journal-Constitution.

Palin chose the day before the election to hit the stump: "We need Saxby because we need checks and balances in Washington, and we will not have that if Saxby is not re-elected," said Palin, per ABC's Teddy Davis. "With one party in control of the House and the Senate and the White House we need a conservative who will speak for themselves." 

No Obama visit, but if he wants to wash his hands of the race, try these details out for size: "Jim Martin, the Democrat trying for the second time in a month to unseat Republican Senator Saxby Chambliss, was standing in one of Barack Obama's old campaign offices the other day, circled by a staff paid for with Obama's dollars, facing a large banner bearing Obama's image," Sasha Issenberg writes in The Boston Globe. 

Said Martin: "I have a little bit more help than I did before."

Think African-American turnout matters?

"Democrat Jim Martin staged a flurry of campaign rallies around the state, capping the day with a raucous event at the state Capitol with hip-hop stars T.I., Young Jeezy and Ludacris urging voters to return to the polls," per the AP's Shannon McCaffrey.

Inching along, in Minnesota: "With the state Canvassing Board scheduled to meet in two weeks to finish the recount, and nearly 6,000 votes being challenged by the two campaigns, a Star Tribune tally late Monday showed that [Norm] Coleman leads by 340 votes. Coleman had challenged 188 more votes than [Al] Franken," Mike Kaszuba and Curt Brown report in the Minneapolis Star-Tribune.

We must be reaching the end if it’s time to entertain regrets: "I think I was unprepared for war," President Bush told ABC's Charlie Gibson, in an interview that aired on 'World News' Monday.

"In other words, I didn't campaign and say, 'Please vote for me, I'll be able to handle an attack,'" he said. "In other words, I didn't anticipate war. Presidents -- one of the things about the modern presidency is that the unexpected will happen."

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