But now his asceticism seems more like a reflection of his cherished membership in the technocratic priesthood — and an unnerving mirror of our starving economy. He’s an egghead who surrounds himself with eggheads, even when they have helped wreck the economy he’s trying to save....There are elements of truth to this. Obama did let himself be bullied on one giant matter, the debt ceiling negotiations. His approach to politics, which the nation bought on election day 2008 -- eliding differences between the parties, pulling the center left by force of reason and eloquence -- crashed and burned right there, and now he's paying the price. Also true: no punishment of the banks, substantive or symbolic (though tell that to the bankers, screaming and rolling and clutching a hundred allegedly bruised body parts as they fight to vitiate Dodd-Frank).
The message from new books by Ron Suskind and Jeffrey Sachs, and from the proliferating Wall Street protesters, seems to be that President Obama is a captive of the banks who pursued policies that helped the very richest people in the country.
Americans who have been hurt want to identify the villains, and Obama is loath to target villains...
Christie can be a bully, but that may seem better than the alternative: a president who lets himself be bullied, and who lets the bullies run wild...
People are longing for a president who can understand their pain, mix it up and get action — not one who averts his gaze, avoids conflict, delegates to Congress, wastes time hunting for common ground, cedes the moon to opponents and fails to get anywhere.
What's not true is that he "failed to get anywhere" -- except in that catastrophic debt ceiling battle. He has "failed" to move the needle on paltry economic growth after a banking meltdown -- and that accounts for at least three quarters of his poll plunge. That's partly deserved, because as Brad DeLong has documented most effectively, he's failed to move energetically on several viable fronts to goose the economy short-term (though people tend to forget the hundreds of billions in new stimulus he brought home in December 2010, at cost of extending all the Bush tax cuts). As for the long term, though, the Obama-led Democrats in 2009-2010 were positively hyperactive -- and potentially very effective. The ACA not only potentially removed the greatest risk to Americans' physical and financial health -- lack of insurance or the constant risk of losing it -- it also could prove the most effective action possible on the long-term deficit, if its cost control measures prove effective -- as they might, if not voided or defunded. Dodd-Frank may be a mixed bag -- especially as banks and Republicans go all out now to weaken it -- but it includes substantial controls that could prevent another meltdown and moderate bank recklessness -- on proprietary trading, on derivatives, on consumer abuse, and through resolution authority. Then there's the decentralized Race to the Top, the clean energy investments in the ARRA (many of which are working), the cleanup of the student loan cesspoool...how soon we forget. Or how little it all seems to matter while the economy languishes.
Also not true: that Obama avoids conflict. He fought hard for a "balanced" deficit reduction plan -- he just fought on the wrong terms, accepting the debt ceiling stopper. Prior to that, he took the Republicans on directly in rallying the Democrats to pass the Affordable Care Act when every vote was needed and some were waffling. People also forget the effective pressure he deployed to pass New START last fall. Then there's the little matter of "conflict" with al Qaeda, where he seems to have methodically steered the military-intelligence complex into forging some deadly approaches.
All that said, when MoDo drops the doo-doo, our hero is in deep-deep. My own (amateur) sense is that the conventional wisdom, that Obama's task is now simply to frame policy contrasts with the Republicans and lambaste them for blocking his agenda, may not serve. I think he needs to stage a fight that he can win. The perception of weakness in the wake of the debt ceiling debacle has sunk in too deep (as in John Gapper's drive-by reference to a "weak president" in a column today about the Wall Street protesters). You see that everywhere. The storyline in the slo-mo deficit reduction/tax reform struggle needs to change.
It's possible that the pressure Obama's putting on the Republicans for blocking his popular jobs bill agenda will lead to piecemeal passage of some parts, such as the payroll tax extension. That will probably come through as a split decision.
Unfortunately, there's no visible path to "winning" the Supercommittee negotiations. At a minimum, the administration needs to be willing to accept deadlock and pull the trigger on the automatic cuts, assuming the Republicans won't agree to substantial tax increases. Perhaps that could be backed by a promise to veto any legislation stopping the Bush tax cuts from sunsetting that does not raise at least, say, $1.5 trillion in new revenue over ten years, the amount called for in Obama's road map for the Supercommittee. That would mean getting something like his grand bargain piecemeal -- but it probably wouldn't happen until after the election, and all would be subject to rewrite in 2013.
Another looming flashpoint is the 2012 budget, a fight that comes to a head in late November. The Republicans are writing up devastating cuts to funding the Affordable Care Act, Dodd-Frank implementation, and remaining ARRA investments. What if Obama drew some clear lines and prepped for a government shutdown? The timing on this one is identical to that of Clinton's budget showdown in 1995. Of course, Clinton pitched his battle as economic growth was accelerating, whereas now a further blow to confidence in our government's ability to function could be devastating. But then, so could further immediate budget cuts.
Finally, as Jonathan Bernstein pointed out yesterday, Obama could stage a fight over confirmation of Richard Cordray as head of the Consumer Financial Protection Board. Republicans are filibustering this nomination simply because they want to destroy the new agency. As Occupy Wall Street gathers steam, this one seems tailor made -- an opportunity to show the Republicans up as the banking industry shills they are, a way to shuck the image that Obama too has kowtowed to the banks. He's been a very lukewarm (can you be 'very' lukewarm? -- never mind) champion of the CFPB all along -- and, as Bernstein keeps reminding us, all too passive about all his blocked appointments. That could change in a hurry:
Staging this fight would also align Obama with Elizabeth Warren, the closest thing progressives have to a rock star. Cordray was her very capable No. 2 and a natural heir. Obama has already adopted some of Warren's rhetoric combining plaudits for the productive wealthy with admonitions that they pay their fair share.
After it passes through the committee, Cordray’s nomination could just quietly rot away on the Senate calendar. Or Harry Reid could bring it to the floor repeatedly, forcing cloture votes and extended debate, supported by a president who highlights the nomination as a prime example of Republican obstruction and how it prevents the government from functioning properly. Indeed, Obama could also threaten to use a recess nomination for Cordray (and some of the others stuck in Senate limbo), and then actually carry out that threat.
Do it, Obama. Pick a fight and win it. Change the narrative now.