The Note, 1/8/09: Obama Argues that Government is the Answer

January 08, 2009 8:25 AM

By RICK KLEIN

Since it seems to sometimes be OK to have more than one president at a time, maybe it’s fitting that -- on the day those Electoral College votes get counted in Congress -- the one who isn’t president is trying on two hats at once.

First comes the presidential president-elect, with an 11 am ET speech at George Mason University that is both flashback and flash-forward: a campaign-style speech, but also a glimpse of how he’ll look and sound when his presidency commences.

Then comes the political president-elect, with a 3:30 pm ET press conference unveiling his new Democratic National Committee chairman, Gov. Tim Kaine, D-Va.

It’s how President-elect Barack Obama balances these two roles -- the post-partisan one he claimed on Election Day, and the partisan one that still determines how things actually get done in Washington -- that will define the contours of his potential success.

As for the speech -- we know he knows how to give these. But this isn’t precisely like the ones he’s given before, or like those the predecessors he met with Wednesday were inclined to give when they had the chance.

Dust off the FDR references: Obama is making the case that government is the answer after all.

That means re-setting a generation of convention wisdom. That means overcoming deep public skepticism over whether a bigger government with more regulation is likely to be a force for good. That means jumping up and down on a drawer full of political hot buttons.

And that means preparing the public for a push that will be expensive, unpopular, time-consuming -- and that ultimately may not even work.

“If nothing is done, this recession could linger for years,” Obama plans to say, per excerpts released by the transition office.

“There is no doubt that the cost of this plan will be considerable. It will certainly add to the budget deficit in the short-term. But equally certain are the consequences of doing too little or nothing at all, for that will lead to an even greater deficit of jobs, incomes, and confidence in our economy.”

“It is true that we cannot depend on government alone to create jobs or long-term growth, but at this particular moment, only government can provide the short-term boost necessary to lift us from a recession this deep and severe. Only government can break the vicious cycles that are crippling our economy -- where a lack of spending leads to lost jobs which leads to even less spending; where an inability to lend and borrow stops growth and leads to even less credit.”

“I understand that some might be skeptical of this plan,” he’ll continue. “Our government has already spent a good deal of money, but we haven’t yet seen that translate into more jobs or higher incomes or renewed confidence in our economy. That’s why the American Recovery and Reinvestment Plan won’t just throw money at our problems -- we’ll invest in what works. The true test of the policies we’ll pursue won’t be whether they’re Democratic or Republican ideas, but whether they create jobs, grow our economy, and put the American Dream within reach of the American people.”

All of this, of course, is just the start of what the president-elect wants to do. (This is actually the easy part.)

“President-elect Barack Obama said Wednesday that overhauling Social Security and Medicare would be ‘a central part’ of his administration’s efforts to contain federal spending, signaling for the first time that he would wade into the thorny politics of entitlement programs,” Jeff Zeleny and John Harwood write in The New York Times. “Should he follow through with a serious effort to cut back the rates of growth of the two programs, he would be opening up a potentially risky battle that neither party has shown much stomach for.”

David Axelrod, on the rough week: “When you hit a bump, it may not be obvious at the time whether it’s a mountain or a molehill, but they are rarely mountains. . . . There are going to be things that go better than other things. The question is, Are we moving in the right direction? The answer is yes.”

The speech comes at a time that Obama needs to re-exert some control, with the Burris circus and sudden confirmation troubles distracting his team when it needs focus the most.

“The world is falling apart, and we're still waiting for the dawn of Barack Obama. It seems to be taking an eternity,” Newsweek’s Howard Fineman writes. “Rather than give Obama a clean, quick coronation to try to begin writing a new and better chapter, Washington (and especially his own party) seems intent on giving the president-elect as much trouble as possible while waiting for him to take the oath of office on Jan. 20.”

“In the past four days, President-elect Barack Obama, once lauded as having the smoothest transition to power in modern history, has learned how hard it is to navigate the political high wire,” Christina Bellantoni writes in the Washington Times. “The missteps have chafed Capitol Hill allies and proved the difficulty of converting so quickly from candidate to leader of the free world.”

A counter: “Any politician who has ruffled so many feathers from such diverse constituencies must be doing something right,” Stuart Rothenberg writes, at Real Clear Politics. “Every new president causes some grumbling within his own base and even more from the political opposition, but incoming President Obama is particularly vulnerable to complaints from the peanut gallery. That's because when he ran for president promising change, the Illinois Democrat was purposely vague. There are many forms of change, and Obama's campaign message allowed each person to define what he or she thought that change would be.”

And since he’s content to act as a shadow president when it comes to the economy, he gets all of what that comes with.

“President-elect Barack Obama faces a delicate task today as he pitches his economic recovery plan in a major address: He must underscore the urgency of the recession without further unsettling the nation's shaky financial system,” Scott Helman writes in The Boston Globe. “The balancing act between economic realism and optimism is one Obama has faced since winning election in November. But it has come into sharper relief as his inauguration has neared and job losses and other economic indicators have worsened, and it promises to endure well into his presidency.” 

The tough sell: “When FDR took the helm during the Great Depression, the prospect of any government action -- even Roosevelt’s bank holiday -- was welcomed as a shot in the arm. In Obama’s case, the prospect of action -- by itself -- may not be enough without him using speeches like the one Thursday to spell out some larger purpose,” Politico’s David Rogers writes.

Pushback, already, on some of the tax provisions: “At least two tax cuts that are part of Barack Obama's stimulus package have been criticized by lawmakers, tax experts and economists for being potentially too expensive and ineffective, signaling that they are likely to face resistance on Capitol Hill as congressional leaders begin direct negotiations with the president-elect's team,” Shailagh Murray writes in The Washington Post.

“Both Democrats and Republicans have questioned a provision that would provide a $3,000 tax credit to companies for every job created and, possibly, for every job spared. They contend that the idea would be ripe for abuse and difficult to administer. Lawmakers are also skeptical about a measure that would allow companies to deduct large portions of recent losses.”

Politics, already, in the mix: “The drive for quick action on a huge economic stimulus package has become entangled in the push and pull of Washington politics and now may not clear Congress until mid-February,” Jim Puzzanghera and Janet Hook write in the Los Angeles Times. “Obama will make the case for urgent congressional action in a speech today. And House Speaker Nancy Pelosi (D-San Francisco) is so concerned about a delay that she threatened, in an interview Wednesday, to cancel her chamber's Presidents Day recess and hold the House in session if legislation had not reached Obama's desk by the Feb. 16 holiday.”

Watch for this: “Obama has said he will not allow the stimulus to contain any congressional pet spending projects, the controversial items known as earmarks. But lawmakers could work to tilt the tax cuts or government spending their way. The delay also gives interest groups time to try to influence the process, and many have been weighing in with wish lists,” Puzzanghera and Hook write.

The deficit news may not have helped: “President-elect Barack Obama's economic team is pressing ahead with a costly economic-stimulus plan despite a projected $1.2 trillion budget deficit this year,” Jonathan Weisman and Laura Meckler write in The Wall Street Journal.

“And Mr. Obama appears ready to up the ante. In an interview with CNBC on Wednesday, he acknowledged that the plan's price tag, currently $775 billion, is likely to rise. ‘We've seen ranges from 800 [billion] to 1.3 trillion and our attitude was that given the legislative process, if we start towards the low end of that, we'll see how it develops,’ he said.”

But might this help make the case? “Obama’s speech comes as the Labor Department may report tomorrow that employers slashed jobs in December for a 12th consecutive month, putting total job cuts at 2.4 million for 2008, the most since 1945, according to the median forecast in a Bloomberg survey of economists,” per Bloomberg’s Julianna Goldman.

Obama asked for bipartisan cooperation -- and he’s getting it, sort of. “House Republicans plan to unveil their own proposal for a stimulus as early as next week, partly so their conference’s members can avoid being labeled as obstructionists if they oppose a Democratic stimulus bill,” The Hill’s Sam Youngman and Silla Brush write.

Phil Singer offers advice on making the sale: “Instead of allowing the debate about the stimulus to be shaped by its size, Democrats should heed Tip O’Neill’s ‘All Politics is Local’ mantra and sell the American Recovery and Reinvestment Plan by emphasizing what it will do for local communities. By detailing how the stimulus will impact individual congressional districts and states, Democrats will shift the debate over the proposal from the overall price tag (which is a loser) to how local communities will benefit (which is a winner).”

Karl Rove plays some defense: “The housing meltdown is largely a story of greed and irresponsibility made possible by government privilege. If Democrats had granted the Bush administration the regulatory powers it sought, the housing crisis wouldn't be nearly as severe and the economy as a whole would be better off,” he writes in his Wall Street Journal column.

A new twist on an old theme: “It's no secret Barack Obama plans to enact the biggest economic stimulus package in history next month. What's less known is that he plans to quickly follow it with a sweeping re-regulation of the U.S. economy,” Politico’s Jim VandeHei and Mike Allen write. “One of the leading ideas would combine the Securities and Exchange Commission and the Commodities Futures Trading Commission into a super-regulator that would be like another Federal Reserve as a cornerstone of the U.S. financial system.”

Quite the turnaround for Roland Burris -- welcomed Wednesday by the same senators who shunned him Tuesday, and now very much on track for the Senate seat he says is already his.

Did Gov. Rod Blagojevich, D-Ill., win? (Will that matter for his fate?)

(Yes -- he stared down Senate leaders and even Obama himself. Yes -- he gets his man seated. But might he have been happier with a stand-off -- since this means we’ll be talking about Blagojevich himself again?)

“The U.S. Senate's Democratic majority opened the way Wednesday for Roland Burris to become Illinois' next senator, pressured by President-elect Barack Obama to remove a politically consuming distraction less than two weeks before he assumes the White House during an economic crisis,” Rick Pearson and Mike Dorning report in the Chicago Tribune. “A top Senate Democratic source said Obama's concerns about the Burris situation were among several factors that resulted in an about-face by Senate leaders, who had vowed to reject Burris or anyone else named by disgraced Gov. Rod Blagojevich.”

“Obama's message, a Democratic source told me, was that the nation is facing a lot of problems, Illinois needs someone in the Senate seat, the commotion over Burris is a distraction, and an amicable solution needs to be found,” Lynn Sweet reports in the Chicago Sun-Times. “Senate Democrats also came to believe they don't have much of a legal leg to stand on. And racial politics intruded to the point where it was better to try to seat Burris than to stand on technicalities.”

“There were more caves in Washington yesterday than in the mountains of Afghanistan,” Dana Milbank writes in his Washington Post column. “Score one for the Illinois governor, who, on his way to likely impeachment and possibly the slammer, managed to outwit the leadership of his party. . . . Blagojevich's triumph over Democratic leaders in Washington has a lot to do with his deft playing of the race card. Even as they backed down yesterday, Senate Democratic leaders anxiously explained that their former opposition to Burris had nothing to do with his skin color.”

“Move over David Plouffe. The cleverest Democratic campaign manager of the new year appears to be none other than Illinois Gov. Rod Blagojevich,” Politico’s Ben Smith writes. “In a season of troubled ‘rollouts’ -- think Sarah Palin and Caroline Kennedy -- Roland Burris's has been all but flawless. He arrived December 30 with no warning, and his allies played -- to the discomfort of many Democrats -- what was perhaps his strongest political card, race, without shame.”

“In the days that followed, Burris has accomplished his key goals, calling Senate Majority Leader Harry Reid's bluff and putting his own apparently distinguished visage at the center of the story,” Smith writes.

Howard Dean is impressed: “You gotta hand it to Blagojevich,” Dean said on MSNBC Wednesday  “What a maneuver! What a maneuver! When his back was against the wall he outsmarted a lot of people. . . . He'll probably end up in really bad trouble,” Dean added, “but he'll have something to tell his grandchildren.”

Whoops: “Senate Democrats who thought they could push away Roland Burris misjudged the racial fallout, underestimated public reaction and wound up on shaky legal ground,” the AP’s Charles Babington reports. “On Wednesday, they all but admitted being outflanked by Illinois Gov. Rod Blagojevich, praising Burris and suggesting he soon will be a senator.”

This counts as image rehabilitation, at least for these guys. Gail Collins, in her New York Times column: “Pros: 1) Not corrupt. 2) Rod Blagojevich is smarter than he looks. 3) Make Rush Limbaugh stop calling Harry Reid a racist.” 

“Cons: 1) Mausoleum syndrome. 2) Secretary of state signature thing. 3) Excessive reliance on the political advice of loved ones.”

Burris on Thursday testifies before Blagojevich’s impeachment panel, in Springfield, Ill.

Cheers to the Republican National Committee, for finding a fresh way to relate to the public by voting not to be seen publicly.

Some handicapping, from Ralph Z. Hallow of the Washington Times: “Incumbent Mike Duncan probably will get the most first-ballot votes for election as Republican National Committee chairman, but eventual victory likely will go to one of the other two RNC members running for the post in the election scheduled for Jan. 30,” Hallow writes. “Several members attending a first-ever special meeting of the national committee on Wednesday told The Washington Times that they expect either Michigan party Chairman Saul Anuzis or South Carolina party Chairman Katon Dawson to emerge as the party's top national official.”

Haunting the GOP: “A hundred days have passed since House Republicans pushed the Dow Jones over the cliff to its biggest point loss ever with their surprise rejection of Henry Paulson's $700 billion Wall Street bailout,” Fortune’s Nina Easton writes. “Fears of a financial meltdown later changed enough minds to reverse that vote. But the GOP still can't get past the wreckage of that Monday afternoon party revolt as the Republicans struggle to find their voice under an Obama White House.”

Confirmation season starts Thursday, with Tom Daschle before the Senate Health, Education, Labor and Pensions Committee. Roll Call’s John Stanton: “Over the coming days, various Senate committees are expected to take up a host of Obama’s nominations. On Friday, the HELP Committee will take up the nomination of Rep. Hilda Solis (D-Calif.) to be Labor secretary, while the Foreign Relations Committee on Tuesday will take up the nomination of Sen. Hillary Rodham Clinton (D-N.Y.) to be secretary of State and on Thursday will hold a hearing on Obama’s pick of Susan Rice to be the next U.S. ambassador to the United Nations.”

Just in time (just about), Clinton gets a hand with her debt -- courtesy of the Presidential Inaugural Committee.

Chris Matthews is out: “Chris Matthews will continue playing hardball, but not in politics,” Howard Kurtz reports in The Washington Post. “After months of exploring a run for the Senate in his native Pennsylvania, the MSNBC host told his producers yesterday that he has decided against seeking office, a network spokesman said.”

For some fun -- Rolling Stone gives over its cover to the interview President Bush won’t give. (With fresh, sharp details of what Condi Rice is really like behind closed doors.)
 

The Kicker:

“It's going to be a lot of fun, seeing the czars and the regulators and the czars and the Cabinet secretaries debate.” -- Thomas J. Donohue, president of the U.S. Chamber of Commerce, on the czarish proliferation in the incoming administration.

“People who are United States senators should cancel their travel plans this weekend.” -- Senate Majority Leader Harry Reid. (Will Joe Biden still take that last congressional trip?)

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