The Miseducation of the President
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This story was originally published at Salon.
President Obama has a feisty new tone this week, offering up a deficit plan with taxes on the rich and no increase in the Medicare eligibility age (a reported feature of his failed "grand bargain" with the GOP last month). And when Republicans ( and silly Dems) called his proposals "class warfare," he shot back: "This is not class warfare. It’s math."
Maybe Obama read Ron Suskind's controversial book over the weekend, and decided it was time to take control of his presidency and put it on the side of struggling Americans, rather than on the side of super-wealthy Wall Street titans who destroyed the economy, where it's been since Inauguration Day.
It's unlikely the president is finding lessons in "Confidence Men: Wall Street, Washington and the Education of a President"; the White House is pushing back, hard, on Suskind's revelations. The coverage has mostly hyped "shocking" anecdotes about an inexperienced president poorly served by scheming aides and Cabinet members who fought among themselves and frequently ignored the president's own wishes. But the question at the heart of Suskind's book is much more interesting: Who is Barack Obama, and what exactly did he want to do with his presidency?
Was he a bold visionary with big plans, who was hampered by disloyal aides and his own lack of leadership experience? Or did the many examples of underlings "slow-walking" or "relitigating" or simply ignoring the president's alleged decisions, without paying any penalty for their insubordination, reflect Obama's own lack of clarity about and commitment to his priorities and choices?
At the end of the book, the reader has to make a leap of faith -- of confidence, in fact -- about the answer to those questions. Suskind provides evidence for both views.
Bold visionary Obama periodically sides with staffers pushing big moves to break up what Suskind memorably describes as "the debt machine": the financial sector contraption that seized the American economy, almost destroyed it in 2008 and yet, tragically, still runs it in 2011. The book's good guys -- former Fed chair Paul Volcker, consumer protection visionary Elizabeth Warren, Commodity Futures Trading head Gary Gensler, Council of Economic Advisors chair Christina Romer, adviser Austan Goolsbee and the FDIC's Sheila Bair -- turn up regularly with good progressive ideas to beat back financial sector treachery that catch Obama's attention and win his backing ... for a while.
But in the end, whether it's "Volcker's Rule" keeping banks out of speculative, proprietary trading; Gensler's effort to force the trading of poorly understood derivatives on "exchanges" where their shady contents could be better examined; or Bair's push for a contingency plan to force the toxic behemoth Citibank into bankruptcy; the tough reforms never materialized. They were watered down to insignificance, or as in the case of the Citi breakup, abandoned completely.
The book's most controversial revelation, strenuously denied by the White House, is that Treasury Secretary Timothy Geithner either "slow-walked" or absolutely ignored the president's directive to come up with a plan to break up the spectacularly failing Citibank. It's become a big story, because it serves a couple of narratives: It provides Obama admirers with evidence that the president had progressive priorities and values, but his underlings thwarted them. It provides his critics (on left and right) with more fodder for the view that the president is in over his head, unready for the job we gave him.
The fact is, the material Suskind presents is inconclusive. By the president's own admission, the "instructions" to draw up a contingency plan to dismantle Citi were vague enough that his different advisors could legitimately disagree about his real intent.