The danger of overreaching before inauguration

President-elect Obama should wait until January before pushing economic legislation. Defeat by a lame-duck Republican president and a rump Congress would not be good for anyone.
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President-elect Obama should wait until January before pushing economic legislation. Defeat by a lame-duck Republican president and a rump Congress would not be good for anyone.

So much for a honeymoon period — the initial days during which a new president's initiatives are accepted more easily than later on.

Usually that honeymoon period is defined as "the first 100 days" of a presidency. Now, barely a week after President-elect Barack Obama's election, and more than two months before his inauguration, things already are becoming jangled.

I wrote last Thursday, Nov. 6, that U.S. Rep. Rahm Emanuel, who will be Obama's White House chief of staff, and John Podesta, directing his transition, were good choices. Both served eight years in the Clinton White House, but both, I noted, had lives before and after Clinton and would not necessarily be captive to Clinton-era people and policies in serving Obama. Performance on that count has been mixed thus far.

During this period, internal debate has been taking place among Obama advisors who, on the one hand, would like to pursue what they see as big-agenda paths taken by Presidents Franklin Roosevelt and Lyndon Johnson at the outset of Obama's presidency, and others counseling a more-focused and limited agenda. We've yet to see how that debate turns out. (Put me down for focused and limited.)

Small glitches need correction

Obama's first press conference as president-elect last week, after a meeting with economic advisors, was successful. He was in command of his material, spoke confidently, and related easily to media. Less visibly, though, there were glitches around the edges which will need to be corrected before he takes office.

Emanuel and Podesta stood near Obama on the podium. Normally, their roles would have had them standing in the wings, doing the stage managing, rather than taking center stage themselves. The advisors assembled behind Obama included some who were confidence-inspiring (former Treasury Secretary Bob Rubin and Federal Reserve Chair Paul Volcker), figures from business and finance, and a couple less-than-successful Clinton-era Cabinet figures. Notably absent were prominent figures associated with finance/economics from Congress, state and local governments, organized labor, agriculture, small business, and consumer interests. (I could imagine a President John Kennedy or Johnson, both tough politicos, telling their aides after such a conference: "Get yourselves in the background and get the right people in the foreground with me.")

Monday, Obama had an amiable and successful meeting with President Bush. Afterward, Obama aides leaked to media a report that Obama had requested Bush's support for an immediate rescue of the auto industry and that Bush, in turn, had asked for support of a Colombian free trade agreement (opposed until now by Obama). There was an implication that it was a this-for-that proposal by Bush. Then, Tuesday afternoon, Podesta clarified that the two matters were not connected. Within minutes thereafter, House Speaker Nancy Pelosi announced that a lameduck congressional session would convene shortly to consider an undefined Detroit bailout.

It was surprising that the Obama aides made the leaks in the first place. Normally, such a conversation between a president and president-elect would be kept off the record by both sides. Now both sides have been embarrassed, and a bailout and free-trade deal will be more difficult.

These are small but telling matters. Fortunately, they quickly will be erased in public and media memory by upcoming Obama Cabinet appointments. It is encouraging that Obama is taking his time with these. The only appointments requiring urgency are those of a treasury secretary-designate, to work with the outgoing administration on the financial/economic crisis, and a national security advisor to provide backup to Obama on breaking foreign policy/national security issues.

Will the agenda be big or limited?

Presidents Roosevelt and Johnson were active early in their presidencies, it is true. But all of Roosevelt's activity centered around one thing: financial/economic rescue. He is remembered now for his dramatic declaration of a national bank holiday and for such varied experiments as a WPA and NRA to get the economy moving. But it was not until 1935 when the centerpiece achievement of his first term, Social Security, became law.

Johnson's first year in office, after President Kennedy's assassination, was marked by his signature of the landmark Civil Rights Act of 1964 but was spent otherwise in consolidating his position. After his election on his own, in 1965 a big Great Society agenda was enacted into law. But the surrounding economic climate then was far different from today's. A growing domestic economy was characterized by LBJ as "an endless cornucopia" which would spew out perpetual revenues to fund federal programs. The Vietnam War soon ate many of those revenues. In any case, Johnson would never have attempted to simultaneously enact Medicare, Medicaid, federal aid to education, and a war on poverty in the present environment. He likely would have settled for the Voting Rights Act and one other thing.

Obama briefers are saying that national health reform, an ambitious energy initiative, tax proposals, and other 2008 campaign promises can logically be folded into financial/economic rescue. As they cost out the implications of such a strategy, they likely will conclude — or at least I hope they will conclude — that, in his first days, Obama should focus on only one thing: immediate measures to keep the country from drifting into deeper recession or worse. If he tells Congress and the public that this is his sole immediate priority, they will understand and support him. If he presents a laundry list of proposals, and then is unable to deliver, he will needlessly raise and then dash expectations.

Obama should hold his fire until January

If Democrats in Congress, supported by Obama, rush forward in a lameduck session with Detroit bailout proposals, they risk defeat. The present bailout package is for financial institutions, not industrial corporations. Moreover, the Detroit Big Three are burning cash at an alarming rate and may hit a wall early next year. The aid they seek, to finance retooling and new plants, would take years to be felt. What would happen in the interim? Would taxpayers be expected to pour billions into the industry to keep it operating? Skeptics suggest that the companies, as airlines recently did, should instead declare bankruptcy. That would allow them to renegotiate or shed themselves of long-term financial obligations which are keeping them uncompetitive.

In January, President Obama will have a new U.S. Senate and House with enhanced Democratic majorities. He will not need to negotiate with a sitting Republican president. The auto companies, in January, will be more disposed to make concessions in return for any government help. GM's president on Tuesday said he wanted federal money but without strings attached. Not a statement with an appeal either to taxpayers or to practical elected officials.

Both Obama and congressional leaders should reconsider going forward now with a bailout proposal which would be opposed not only by congressional Republicans but by more moderate congressional Democrats. Opinion surveys presently show strong support for Obama, among people of all outlooks, but equally broad pessimism about the direction of the country. It is imperative that Obama not start out with a defeat before his term formally begins.

Don't get me wrong. I remain a strong Obama supporter and have great confidence in his capacity to govern. But I am concerned that tactical and operational bumbles now might impede his chance to really get rolling after January 20. Stay watchful.


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About the Authors & Contributors

Ted Van Dyk

Ted Van Dyk

Ted Van Dyk has been active in national policy and politics since 1961, serving in the White House and State Department and as policy director of several Democratic presidential campaigns. He is author of Heroes, Hacks and Fools and numerous essays in national publications. You can reach him in care of