Conflicting Signals?

By Matthew Wolf

President-elect Obama’s cabinet appointments have drawn fire from the left, arguably the core of the electoral base that elected him to the highest office in the land last month.

The more recent “Security Team” appointments, Hillary Clinton to Secretary of State, Robert Gates retained as Secretary of Defense, and General James L. Jones as National Security Advisor, is touted as a Lincoln-like “Team of Rivals”. Although few are giving Doris Kearns Goodwin credit for the title of her book about Abraham Lincoln of the same name, on the same subject, most Liberals are fairly understanding of the reasons for these appointments.

Gates has been an improvement over his predecessor (whose name my hands refuse to type) in magnitude that might be measured in light years. He has taken up the cause of making military spending of our tax dollars more responsible, relevant, and effective. And, as will be discussed more below, reigning in the national budget is a topic near and dear to Mr. Obama’s heart. At the end of the day, it seems to be widely considered prudent to retain continuity in this office while we are at war.

Ms. Clinton was likely backed in the primaries and caucuses by nearly half of the liberals in question. She has obvious organizational skills, international networks, and is somewhere up the learning curve having served on the Senate Committee on Armed Services. The argument that Obama would put her in this office in order to silence her, as Nixon did to William Rogers, seems quite preposterous. Comparing Obama to Nixon is a very long reach, but the real bottom line is that, regardless of the differences that their primary battle may have emphasized, she and the President-elect likely have much common ground philosophically on foreign affairs, she was not entirely happy with her continuing junior role as a US Senator, and should make an outstanding representative in this post.

Jones is a very level headed and capable man, with combat experience in the field as a marine platoon and company commander with G Company, 2nd Battalion, 3rd Marines which fought in the Battle of Khe Sanh in Vietnam, among other engagements. He served in Bosnia also, and has earned the Defense Distinguished Service Medal, a Silver Star and a Bronze Star with V for valor.

General James L. Jones

General James L. Jones

The biggest critique the left has of Jones is that he was not outspoken in the press about his reservations, or outright dissent, about the Iraq War. Yet taking it to the press is not his style; he apparently let Rumsfeld and former Joint Chiefs Chairman Peter Pace know his views behind the scenes.

Don’t forget that high ranking military officers who break ranks to take their arguments to the press are sometimes (maybe often) characters like General Wesley Clark, who thought he could bluff Slobodan Milosevic in Kosovo, predicting a “neat, tidy, and bloodless outcome” (Bacevich 2008, p.150). The subsequent continuation of NATO bombing killed 500 civilians while Milosevic’s stepped up ethnic cleansing campaign, his way of calling Clark’s bluff, murdered untold ethnic Albanians and created a huge refugee problem. Soon after, Wesley was ushered into early retirement and subsequently hit the talk show circuit promoting Kosovo as a great victory, claiming that the methods applied there “provided the template for future operations” (Bacevich 2008, p.142).

As General George Patton rides by in a Jeep in the hills of Sicily:

Soldier 1: “There goes old blood and guts.”

Soldier 2: “Yeah…our blood…his guts…”

— From the movie Patton.

Soldiers like James L. Jones, who have been in combat, are much less likely to buy off on grandiose ideas of American military exceptionalism, such as Iraq, which was to take three months and will never be over. As sincere as George Bush’s condolences to the families of soldiers killed in Iraq appear on television, his actions tell otherwise. And he didn’t even have the guts to serve his country in the rear echelon.

The real controversy surrounds Obama’s choice of financial advisers. While strongly promoting a sizable Keynesian response to the present economic recession, the President-elect has nominated Tim Geithner to be his treasury secretary, Larry Summers as director of his National Economic Council, Peter Orszag as director of the Office of Management and Budget (OMB), Christina Romer as director of the Council of Economic Advisors, and Paul Volker to chair the new Economic Recovery Advisory Board. Geithner and Summers are protégés of Robert Rubin, Bill Clinton’s second Treasury Secretary, who has been a senior executive at troubled Citicorp.

As much as these nominations have reassured Wall Street and many conservatives, The Economist notes that “Mr. Obama’s backers, in fact, can with some justification feel betrayed by the presence of so many figures from the Clinton regime…” Here’s what Noam Chomsky thinks:

Paul Krugman and others think there is a noticeable absence of Keynesian economists on the financial team. James Galbraith, Larry Mishel, Dean Baker, and Jared Bernstein are among those that progressives would like to see in the new administration. While I am not one who generally favors pandering Wall Street, the circumstances presently faced by our new leader seem to justify the hiring of highly qualified individuals who won’t rock the boat like appointment of the Keynesians noted above might. Even Krugman says:

there have been some complaints from movement progressives about the centrism/orthodoxy of Obama’s economics appointments. To some extent this was unavoidable, I think: someone like the Treasury secretary has to be an experienced hand who can deal with Wall Street, and I haven’t heard anyone proposing particular individuals with clearer progressive credentials to hold that position.

Geithner’s only real drawback, it seems, is his relationship to his mentor, Lawrence Summers, who made controversial statements regarding women, affirmative action, and Cornel West, while president of Harvard University. He also protected Andrei Shleifer from receiving a more just punishment for his actions in Russia, ultimately resulting in his resignation at Harvard. I wonder if, in fact, the controversy about Obama finance team appointments doesn’t stem more from Summer’s ill conceived and unwarranted statements and actions as Harvard president than from an objective assessment of the skills of this team. Had he brought in someone other than Summers, Obama may have spared himself much of the disenchantment voiced by his core supporters. Charles Ogletree, a law professor at Harvard gets it right in the December 6, 2008 NY Times:

Barack thinks with his mind open … Larry thinks with his mouth open.

While many wish to focus on Paul Volker’s history of bloodbath fiscal policy, listen to what he said last winter when he publicly backed Obama (from the NY Times);

“After 30 years in government, serving under five Presidents of both parties and chairing two non-partisan commissions on the Public Service, I have been reluctant to engage in political campaigns. The time has come to overcome that reluctance,” Volcker, a Democrat, said in a statement today. “However, it is not the current turmoil in markets or the economic uncertainties that have impelled my decision. Rather, it is the breadth and depth of challenges that face our nation at home and abroad. Those challenges demand a new leadership and a fresh approach.”

He concluded: “It is only Barack Obama, in his person, in his ideas, in his ability to understand and to articulate both our needs and our hopes that provide the potential for strong and fresh leadership. That leadership must begin here in America but it can also restore needed confidence in our vision, our strength, and our purposes right around the world.”

At the end of the day, Obama has put together a strong group of advisors who should be expecting to execute his ambitious economic stimulus plan, assuming Congress cooperates. The talent assembled is in stark contrast to the economic and financial advisors involved in the present administration, which might be described as economics by Braille (or cronyism).

nominated by President-elect, Obama as Director of the OMB

Peter Orszag: nominated by President-elect, Obama as Director of the OMB

In fact, one of the greatest contrasts with the Bush administration promises to be the direction of the OMB under Peter Orszag. From an unknown source:

As director of the Congressional office since January 2007, Mr. Orszag has an up-to-the-minute familiarity with current budget issues. He has focused particularly on health policy, since cost increases for Medicare, Medicaid and other programs are projected to contribute to unsustainable budget deficits in coming years. Such expertise could help Mr. Obama, who has promised to expand health-care insurance to more Americans while containing costs.

Mr. Orszag served as an economic adviser to President Bill Clinton, and before that to Mr. Clinton’s Council of Economic Advisers. After leaving the White House, he formed an economic consulting company, and then became a senior fellow for economic studies at the Brookings Institution, a center-left research organization in Washington. There, he directed the Hamilton Project, which enlists scholars to propose solutions for problems with big fiscal and societal costs, and the Retirement Security Project, which promotes public and private incentives to help improve retirees’ income prospects.

Mr. Obama intends to fund some of his programs out of budget savings and notes that Mr. Orszag “doesn’t need a map to tell him where the bodies are buried in the federal budget.” The direction of OMB under the new administration promises to be one of the most positive changes. Along with Obama’s long standing attitude (and accomplishment) of fiscal efficiency and effectiveness, his choice of director, one with a solid background in the field and intimate knowledge of the federal budget, offers a glaring contrast to the four directors appointed during the Bush administration. The Economist notes that all four were trained as lawyers; “one was a pharmaceuticals executive, one did government relations for an investment bank, and two were congressmen.”

This, of course, is an area with a long history of strong rhetoric on the campaign trail followed by little administrative progress. But, for the many reasons noted above, I think Obama and his team will have a significant impact in tightening the budget. All taxpayers stand to benefit if Obama, who said, “We can’t sustain a system that bleeds billions of taxpayer dollars on programs that have outlived their usefulness or exist solely because of the power of politicians, lobbyists or interest groups” and his team can make an impact in this area. Getting more bang for our taxpayer buck could not begin at a better time than now.

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2 Comments

Filed under Consultants and Strategists, Obama

2 responses to “Conflicting Signals?

  1. Tony Robinson

    Great insights and a very informative Post, Matt. I agree that Obama’s National Security appointments don’t represent as much continuity as they might appear at first glance. Both Gates and Jones have a history of delivering searing critiques of the Bush security strategy of combat readiness and success through military victory. Gates and Jones have suggested a bigger need for “soft power” strategies of investing in infrastructure improvements in countries, diplomacy, etc. Gates has suggested increasing the dept of state budget, even at his own dept’s expense. Etc. Etc.

    On the economic front, progressives should be more concerned. The central role that Volcker and Summers are playing is not a good omen for progressives, as a reading of Naomi Kline’s The Shock Doctrine will reveal. Read over that book to find the Clinton fingerprints (and Summers’ and Rubin’s) all over the devastating “restructuring” of Asian, Russian and Latin American economies in the lat two decades, complete with support for growing poverty and military authoritarianism worldwide. The budding Russian democracy was strangled in its cradle by Rubin-Summers faction who always value military force and even torture over democratic processes, as long as their corporate associates can make a killing. Kline is devastating in documenting this, and Obama should not be given a pass on associated with these characters.

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