Obama Needs to "Reset" his Presidency

Great article.

http://online.wsj.com/article/SB1247...s_opinion_main

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Time out, Mr. President.

As we approach the August congressional recess, it's clear that our economic distress is deeper than we thought, and thus your health-care and energy initiatives are in danger of stalling out. You could use a reset button for domestic policy.

Let's take it from the top.

Your presidential campaign was superb. You restored hope to millions -- including me -- who had been demoralized by the political polarization that characterized the presidencies of Bill Clinton and George W. Bush. You talked about reaching across party and ideological lines to get the public's business done. Your biography was appealing, and for those of us who entered politics motivated by the civil-rights struggle, your candidacy represented an important culmination.


You displayed an intellect and sense of cool that made us think you would weigh decisions carefully and view advisers' proposals with skepticism.

The first warning signals for me came with your acceptance speech at the Democratic National Convention. In it, you stressed domestic initiatives that clearly were nonstarters in the already shrinking economy.

I had greater concern when you staffed your administration and White House with a large number of Clinton administration retreads who had learned their trade in the never-ending-campaign culture of the Clinton years. Some appeared to represent what you had pledged to eradicate in the capital.

Many of the missteps that have followed flowed, in part, from your reliance on these Clinton holdovers. Your chief of staff, Rahm Emanuel, defined your early strategy by stating that the financial and economic crises presented an "opportunity" to jam through unrelated legislation. To many of us, the remark was cynical and wrong-headed.

The crises did not represent an opportunity. They presented an obligation to do one thing: Return our financial system and our economy to good health.

Since January, your advisers have compared your situation to those of Presidents Franklin D. Roosevelt and Lyndon Johnson after their landslide victories in 1932 and 1964. In fact, your situation is quite different. Most centrally, FDR's and LBJ's victories and congressional majorities were far larger than yours. Thus their mandates were stronger.

FDR's first months in office were devoted entirely to financial and economic recovery. His big domestic initiative, Social Security, was not enacted until 1935. LBJ pushed an ambitious Great Society agenda into law in 1965. But the U.S. economy was growing robustly in 1965. Johnson referred to it as "an endless cornucopia" which would generate tax revenues to pay for the Great Society. When he learned in mid-1967 that the projected federal budget deficit was $28 billion -- almost twice the amount projected six months earlier -- he went to Congress to push for tax increases in order to prevent Vietnam War and Great Society spending from creating unacceptable deficits.

Your staff recently has compared your strategy in pushing health-care and energy initiatives to the way Johnson pushed his Great Society legislation. That's not a fair comparison. Johnson's initiatives were framed in the White House by his administration. But at every stage, congressional leaders of both political parties and financial, business, labor and other private-sector leaders were consulted. Johnson wanted to assure that his legislation was substantively sound and could get consensus support in the Congress and the country.

Your strategy, by contrast, has been to advocate forcefully for health-care and energy reform but to leave the details to Democratic congressional committee chairs. You did the same thing with your initial $787 billion stimulus package. Now, you're stuck with a plan that provides little stimulus until 2010. A president should never cede control of his main agenda to others.

This tactic has already had negative consequences. Frightened by the prospective costs of your health-care and energy plans -- not to mention the bailouts of the financial and auto industries -- independent voters who supported you in 2008 are falling away. FDR and LBJ, only two years after their 1932 and 1964 victories, saw their parties lose congressional seats even though their personal popularity remained stable. The party out of power traditionally gains seats in off-year elections, and 2010 is unlikely to be an exception.

What adjustments should be made?

- Cut back both your proposals and expectations. You made promises about jobs that would be "created and saved" by the stimulus package. Those promises have not held up. You continue to engage in hyperbole by claiming that your health-care and energy plans will save tax dollars. Congressional Budget Office analysis indicates otherwise.

It's time to re-examine these initiatives. Could your health plan be scaled back to catastrophic coverage for all -- badly needed by most families, but quite affordable if deductibles are set at the right levels? Should the Rube Goldbergian cap-and-trade proposals be replaced with a simple carbon tax, with proceeds to be allocated to alternative-fuels development?

The evolving health and cap-and-trade bills are loaded with costly provisions designed to gain support from congressional leaders and special-interest constituencies. In short, they have become an expensive mess. This legislation will not clear Congress by the August recess, as you have requested, and could be stalled for the remainder of 2009. Settle for incremental change: Do not press Democratic legislators to vote for something they fear will destroy them in 2010.

- Talk less and pick your spots. You are outdoing even Johnson and Mr. Clinton with your daily speeches in the capital and around the country.

Applause and adulation are gratifying. But the more you talk, the less weight your words will hold. Let voters see you at your desk, conferring with serious people about serious matters. When you do choose to talk, people will understand that it's important and they should listen.

- Conform your 2009 politics to your 2008 statements. During your campaign, you called for bipartisanship and bridge-building. You promised to reduce the influence of single-issue and single-interest groups in the policy process. Yet, in your public statements, you keep using President Bush as a scapegoat.

You have ceded content of your principal proposals to Democratic congressional leaders who in large part have yielded to special-interest constituencies and excluded Republican leaders from policy formulation. This certainly was the case with the stimulus plan. It has been the case with health and energy legislation, with the notable exception of Sen. Max Baucus's attempt in the Senate Finance Committee to develop genuinely bipartisan legislation.

You have an enormous reservoir of goodwill among Americans of all persuasions. They want you to succeed. Level with them and trim your proposals to what is practical in the current environment.

You had things right in 2008. Take a timeout. Get back to yourself. Make a fresh start.

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a line from white men can't jump sticks out regarding this president. something along the lines of "doesn't matter if you win, just look good doing it"

The author obviously still believes that what Obama said during the campaign was what he actually meant. What he said was to get elected; what he is DOING is what he believes.

Don't listen to what they say, watch what they do.

people are still the deer in headlights.


http://www.youtube.com/watch?v=431c83RLjmM


better wake up

Well the author's wrong on one thing.

Obama's still got his fingerprints all over the legislation going through Congress. Anyone is a fool to think that him, Rahm, and Axelrod, and his 500 czars aren't pulling the strings behind the scenes.

They are willing to let the Dems in Congress appear to be leading the charge so that if (when) it all blows up, he can absolve himself of blame and sell them out. It's how politics work in his hometown (Chicago). We're just getting a front row seat to the same thing on a national stage, that unfortunately is going to fuck us all, our kids, and our grandkids.

The market will take care of itself.

Won't it?

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Originally Posted by ChumpDumper

The market will take care of itself.

Won't it?

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Trickle down economics... haven't you heard?

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Originally Posted by ElNono

Trickle down economics... haven't you heard?

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You mean trickle up economics now, don't you?

trickle up poverty

You keynesians couldn't run a taco stand :lmao

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Originally Posted by SonOfAGun

trickle up poverty

You keynesians couldn't run a taco stand :lmao

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No shit. I wonder how much of this repression we have is intentional, and how much is ignorance?

Because unregulated free markets and neocapitalism works great... until it drives you into a recession that is. :jack

Some people forget very quickly when we hit the recession...

"trickle down recovery"

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Originally Posted by Viva Las Espuelas

"trickle down recovery"

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:lmao

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Originally Posted by ElNono

Because unregulated free markets and neocapitalism works great... until it drives you into a recession that is. :jack

Some people forget very quickly when we hit the recession...

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Some people apparently also forget that free markets and 'neocapitalism' also got us out of every one of those recessions we had before.

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Originally Posted by Aggie Hoopsfan

Some people apparently also forget that free markets and 'neocapitalism' also got us out of every one of those recessions we had before.

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Wow. I can't believe you're saying that with a straight face.
'The market will correct itself' is one of the few economic theories were never really applied in the real world.
Every time we came out of a recession, from the Big Depression all the way to the Japanese recession of the 90's, was by applying Keynesian economics.
Grab a history book one of these days. They don't bite, and will save you from making a fool out of yourself next time around.

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Originally Posted by ElNono

Every time we came out of a recession, from the Big Depression all the way to the Japanese recession of the 90's, was by applying Keynesian economics.

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There are also those who say such things prolonged recessions.

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Originally Posted by Wild Cobra

There are also those who say such things prolonged recessions.

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Could be. That said, the reason it's applied is because it's pretty much the only economics policy proven to give results in the real world.
But the Free Market simply does not offer any way to reactivate an economy in recession. 'The market will correct itself' is simply something that you could not apply at all in the current situation. If you do, you would have needed to let all banks crash and burn, and the bank runs would have been devastating.
Now, I understand somebody like you WC know this, even if you're a pure free market guy. But I'm really wondering where Aggie got his info from.

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Originally Posted by ElNono

Wow. I can't believe you're saying that with a straight face.
'The market will correct itself' is one of the few economic theories were never really applied in the real world.
Every time we came out of a recession, from the Big Depression all the way to the Japanese recession of the 90's, was by applying Keynesian economics.
Grab a history book one of these days. They don't bite, and will save you from making a fool out of yourself next time around.

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:lmao

There was nothing Keynesian about getting out of the Great Depression. It took WWII and the associated production to do that. In many respects we're still suffering from the big government 'solutions' that were created back then.

Show me one country where legislating the fuck out of everything helped get them out of a recession.

If this shit keeps up, by the time the Obama Administration ends, it's likely China will have a freer economy than the liberal crap we have here.

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Originally Posted by Aggie Hoopsfan

If this shit keeps up, by the time the Obama Administration ends, it's likely China will have a freer economy than the liberal crap we have here.

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You're a great American, AHF.:lol

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Originally Posted by ElNono

Could be. That said, the reason it's applied is because it's pretty much the only economics policy proven to give results in the real world.

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How is it proven? Because there was a recovery that half the people believe would have happened anyway?

Assume for a moment that it would have happened anyway. How does that prove that financial intervention helped? It doesn't.

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Originally Posted by ElNono

But the Free Market simply does not offer any way to reactivate an economy in recession. 'The market will correct itself' is simply something that you could not apply at all in the current situation. If you do, you would have needed to let all banks crash and burn, and the bank runs would have been devastating.

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First of all, the market and the economy are two different things. Enterprising individuals will always find a way to make a buck. Not all the banks will crash, and the ones that survive will be stronger. You are obviously a glass half empty individual. I am not.

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Originally Posted by ElNono

Now, I understand somebody like you WC know this, even if you're a pure free market guy. But I'm really wondering where Aggie got his info from.

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I'm not for a 100% free market. Some regulation is necessary. I simply think we have too much regulations. Then to reward bad decisions by investors and banks definitely does not bring positive change.

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Originally Posted by Aggie Hoopsfan

There was nothing Keynesian about getting out of the Great Depression. It took WWII and the associated production to do that. In many respects we're still suffering from the big government 'solutions' that were created back then.

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And pray tell what do you think happened to government spending in World War II? Do you think spending decreased or stayed balanced? We spent, spent, spent. Keynes economics were applied as early as mid-1930 and as late as 1960, throughout the post-war economic boom. It wasn't until the mid 60's that Friedman and Hayek brought up monetarism, and the US made it it's economic policy to fight stagflation.

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Originally Posted by Aggie Hoopsfan

Show me one country where legislating the fuck out of everything helped get them out of a recession.

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Keynes economics were applied both here in the US and Japan to successfully end both recessions. The Japanese case was actually a stand out, because they didn't apply it fully to begin with fearing all that spending was going to wreck their economic future, and it only deepened their recession until they went all out on it.
What I'd like you to show me, is what other economic policy has been successful in ending a recession in the real world.

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Originally Posted by Aggie Hoopsfan

If this shit keeps up, by the time the Obama Administration ends, it's likely China will have a freer economy than the liberal crap we have here.

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What are you bitching about exactly? Bush received a mostly balanced budget, and destroyed it. He had his own stimulus package that was as ineffective as Obama's. The healthcare and trade and cap reforms aren't even finalized yet, and you can already tell some Dems are bolting. And you know that if they don't pass them before the end of this year, they're basically going to be scrapped. I could see your point on the auto-maker debacle, but it's nothing compared to the TARP, proposed and voted by no other than the supposed 'fiscally conservative' GOP.
Both parties are the same shit. They wave different colored flags, but when push come to shove, they both bend over and take it.

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Originally Posted by Wild Cobra

How is it proven? Because there was a recovery that half the people believe would have happened anyway?
Assume for a moment that it would have happened anyway. How does that prove that financial intervention helped? It doesn't.

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It's proven because there was simply no other policy to follow and that was the policy applied at the time. Monetarism? Once the interest rates hit zero or near zero, there's nothing else written in that book. You're basically on your own. It proposes absolutely nothing as far as reactivating an economy.

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Originally Posted by Wild Cobra

First of all, the market and the economy are two different things. Enterprising individuals will always find a way to make a buck. Not all the banks will crash, and the ones that survive will be stronger. You are obviously a glass half empty individual. I am not.

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You've never experienced a bank run. I have. It's not pretty at all.
I did say back then that what could have been done was a 'ordered bankruptcy'. Basically, only letting a bank fail at a time, as to avert the panic that normally follows. The thing is, I'm not sure if it could have been averted at all if one of the really big ones were to fail.

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Originally Posted by Wild Cobra

I'm not for a 100% free market. Some regulation is necessary. I simply think we have too much regulations. Then to reward bad decisions by investors and banks definitely does not bring positive change.

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I'm with you on this. I don't think Free Market is necessarily bad. I just think that when it's not properly regulated you end up with monopolies and oligopolies that are very hard to break. We see that every day. From the cable co to the pharma co. I also see the problem with overly regulating.
That's exactly why I singled out unregulated free markets and neocapitalism. That specific way of thinking leaves no room whatsoever for regulation.

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Originally Posted by ElNono

I'm with you on this. I don't think Free Market is necessarily bad. I just think that when it's not properly regulated you end up with monopolies and oligopolies that are very hard to break. We see that every day. From the cable co to the pharma co. I also see the problem with overly regulating.
That's exactly why I singled out unregulated free markets and neocapitalism. That specific way of thinking leaves no room whatsoever for regulation.

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The free market doesn't create the monopolies, the govt. does by awarding the contracts and making it illegal to compete in the name of "creating incentives to produce."

And there was a depression that we got out of by sitting on our hands and doing nothing. It was the depression of 1920. That was sadly followed by the giant credit expansion of the 1920's. And Hoover and Roosevelt's policies during the Great Depression were pretty much identical. Hoover just sucked at PR and giving people hope. Just because we haven't tried doing nothing since then doesn't mean the principles wouldn't work.

On a larger note, when it comes down to it America has anything but a free-market. They simply don't exist in the world. So how people can say they know the dwindling free part of the economy causes the problems as opposed to the interventionist side is beyond me.

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Originally Posted by angrydude

The free market doesn't create the monopolies, the govt. does by awarding the contracts and making it illegal to compete in the name of "creating incentives to produce."

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Or due to collusion, price-fixing, dumping, etc. The reality is that normally the one with the most capital wins.

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Originally Posted by angrydude

And there was a depression that we got out of by sitting on our hands and doing nothing. It was the depression of 1920. That was sadly followed by the giant credit expansion of the 1920's. And Hoover and Roosevelt's policies during the Great Depression were pretty much identical. Hoover just sucked at PR and giving people hope. Just because we haven't tried doing nothing since then doesn't mean the principles wouldn't work.

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Very different scenarios. The 1920 recession had to do with money supply shrinking due to the government reducing massive spending after World War I. But after the war we had built a strong manufacturing business. In a way, it wasn't that much different than the Clinton recession of the 2000, the difference being that in 2000 what we had built was a strong technology business. They both are in part at fault for the big recessions that followed them, by creating an unsustainable credit boom. In 1920 was the stock market bubble and in 2000 was the housing bubble. Neither of them had to really reactivate the economy.

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Originally Posted by angrydude

On a larger note, when it comes down to it America has anything but a free-market. They simply don't exist in the world. So how people can say they know the dwindling free part of the economy causes the problems as opposed to the interventionist side is beyond me.

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I agree, in part. I do agree there's no pure free market out there in the world, but I also think a pure free market is an utopian creation. Once somebody manages to hoard enough capital, there's simply no incentive to compete. The only incentive is to keep the status quo.

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Originally Posted by angrydude

The free market doesn't create the monopolies, the govt. does by awarding the contracts and making it illegal to compete in the name of "creating incentives to produce."

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Yeah, but if you can find a cure for THAT problem, you'll win a Nobel prize.

Removing copyright law and trade secrets removes almost every monopoly :stirpot:

Incentive remains as evidenced by open software and open standards in many industries.

The only thing left is to heavily regulate mergers and buyouts. Price fixing becomes a non-issue in almost every market since there are no patents and secrets. That leaves a few industries like raw resource handling (oil,diamonds,food,etc) in which you just force splits so no one monopolizes the good.

The problem is the government sucks at doing the most basic thing! Monopolies are allowed to exist (telecom, Microsoft, gas). The most basic regulation possible, that of busting up monopolies, isn't even done. Then the government goes and throws thousands of other regulations that drown out the free market (huge subsidies, bloated contracts, wildly overzealous safety standards in response to freak accidents, etc, etc).

Meh, I wish I was dictator for a year so I could mess around and experiment with some real policy. I don't think anyone in DC actually knows what they are doing. We don't have a free market or a socialist one. It's some weird twisted market where the government enforces monopolies through overly long patents and copyright law, in which simple regulation isn't enforced, and where hundreds of little regulations drown small business and outsource industry.

People can go on about economic theory all they want. We have a screwed up economy and no one knows what fixes it. People just implement policy until it reverses, and then claim after the fact that their policy fixed it. It's a viscous cycle, and I can't help but feel that we bleed money from inefficieny in our economy.

The real issue to me here is not necessarily regulation of markets. Its that we are spending on a ridiculous scale, with no thought as to how to actually pay for it. At least with WWII and the New Deal, that stuff for the most part got paid for by US citizens through war bonds and what not. Now, we say, "fuck it, lets borrow from China, because they are super nice and would never think of calling in our debts at an inopportune time."

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Originally Posted by sabar

Removing copyright law and trade secrets removes almost every monopoly :stirpot:

Incentive remains as evidenced by open software and open standards in many industries.

The only thing left is to heavily regulate mergers and buyouts. Price fixing becomes a non-issue in almost every market since there are no patents and secrets. That leaves a few industries like raw resource handling (oil,diamonds,food,etc) in which you just force splits so no one monopolizes the good.

The problem is the government sucks at doing the most basic thing! Monopolies are allowed to exist (telecom, Microsoft, gas). The most basic regulation possible, that of busting up monopolies, isn't even done. Then the government goes and throws thousands of other regulations that drown out the free market (huge subsidies, bloated contracts, wildly overzealous safety standards in response to freak accidents, etc, etc).

Meh, I wish I was dictator for a year so I could mess around and experiment with some real policy. I don't think anyone in DC actually knows what they are doing. We don't have a free market or a socialist one. It's some weird twisted market where the government enforces monopolies through overly long patents and copyright law, in which simple regulation isn't enforced, and where hundreds of little regulations drown small business and outsource industry.

People can go on about economic theory all they want. We have a screwed up economy and no one knows what fixes it. People just implement policy until it reverses, and then claim after the fact that their policy fixed it. It's a viscous cycle, and I can't help but feel that we bleed money from inefficieny in our economy.

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Well, that's the other extreme. I do think there's a middle ground somewhere. I'm not necessarily against the 8 year patent system. Seems a reasonable time to recoup your investment and make a nice profit.
The 100 years copyright term however is ludicrous.