October 20, 2011

The Presidency we should have gotten in 2009

I'm reading Ron Suskind's "Confidence Men" right now. Yikes. Even more than the reviews revealed, a management-incompetent, unprepared Obama is shown to be without clothes indeed. He made ALL the wrong picks for financial positions. Imagine, instead (and this was all entirely possible):
1. Paul Volckier, the experienced older hand, at Treasury
2. Austan Goolsbee, somewhat a neolib, but not a Rubinite, at Natl Economic Council
3. Larry Krueger, or an outside prestigious guy like Stiglitz, at Council of Economic Advisors, with Stiglitz, whether getting this position or not, eventually replacing Bernanke at the Fed.

And, Tom Daschle (yes, he's a neolib, but an organized political player), at chief of staff. And a political realist. (He was considered, and should have been Obama's first choice, ahead of both Rahm Emanuel and Pete Rouse, if Daschle wouldn't have considered that a step down.)

Among other things, Daschle might have prevented Mod Max Baucus from hijacking health care the way he did. (More below.)

Instead, within the bipartisan duopoly, we honestly got the wrong person elected president.

That said, let's flip the deck and imagine things after John Sidney McCain III takes the oath of office Jan. 20, 2009.

Outside of Obamacare, McCain probably wouldn't have handled a lot of things a lot hugely differently. We would have had a smaller stimulus, true. But Dems would have made gains in midterms against an ineffectual GOP. McCain would have spent a bit more after the midterms. Probably a smaller Afghanistan war than we have now. Palin would be imploding as Veep by now and probably resigned.

So, John McCain, by acting like Herbert Hoover over the original TARP talks, screwed it for all of us. (That said, it was clear before then that he was as clueless as Bush as far as having an actual policy here; Suskind points out that Hank Paulson was almost as clueless even while claiming to be on top of things.)

At the same time, if McCain had kept a bit of that moral fervor against "moral hazard," he might have put more preconditions on further bailout money, instead of letting the likes of Citigroup off the mat time after time, as we have just done again.

Joe Nocera's review of "Confidence Men" provides more details on the main incident of handling Citigroup with kid gloves.
The most explosive allegation in “Confidence Men” concerns one such instance, early in the Obama presidency, when several top White House advisers, including Summers, wanted to “wind down” and restructure Citigroup, the most troubled of the too-big-to-fail banks. Obama liked the idea; it would show, he thought, that the government was willing to tackle the predicament of the banks and their toxic assets head on, and would set the proper tone for the way his administration planned to treat the banks. But Geithner, Suskind writes, strongly opposed the idea, so he just waited for the moment to pass — and for the president to forget about it. Suskind flatly labels Geithner’s action a “fireable offense.” 
But, he wasn't fired. As far as we know, he wasn't even given that severe of a dressing down. Or any. And, in Suskind's level of detail, if Geithner had been called on the rug, we'd know about it.

Anyway, picture a McCain presidency. The economy would be marginally worse off, but not seriously so, and the GOP would look even more idiotic than it actually does. Meanwhile, the Dems would have had openings for more honestly populist candidates than Obama. And, both Democratic leaders and the party as a whole, or even the nation as a whole, would have gotten to see Obama either develop some management skills, or not.

And, whomever came out of the Democratic 2012 primary battles would have been a prohibitive favorite for election.

Now, then, following the arc that Suskind paints, let's picture, instead of a team of financial advisers prostituted to Wall Street, some sort of semi-progressive Team Obama.

A bit further in, at the end of a chunk of Daschle time, Suskind, riffing on Daschle and Daschle's ideas, also notes this: We didn't get health care reform, we got health insurance reform. Between regulation and cost controls, this is something I've said for better than 18 months myself.

Suskind says that Baucus' grudge against Daschle is personal, without saying what all is involved.

But, a Daschle as chief of staff pushing Obama to get and stay engaged? We have a different health care bill, and one that passes House and Senate before Scott Brown's election.

That said, I think Suskind treads lightly over the player/lobbyist connections of both Daschle and his wife. We might have gotten health insurance, but not care, reform with Daschle, too - single payer without cost controls. 

We also, per Suskind, would have had a chief of staff working day and night to disillusion Obama of "bipartisanship."

Anyway, I suspect Daschle was Suskind's biggest source for this book other than Peter Orszag.

1 comment:

Sheldon said...

Interesting post. I think its a good point the world would not have collapsed if Mcain won much more than it already has, and even if he died in office, Palin would be resigning quicker than if she did as governor.

They say that it takes a Democrat like Obama to get Republican policies passed, I wonder if the reverse is true, and Mcain would end up advocating stimulus policies?