Tuesday, October 28, 2008

The Next New Deal

A fascinating discussion on what is happening as Obama is on the verge of getting elected President, and what might happen in his Administration first 100 days. Given the economic turmoil and uncertainty and even fear, FDR springs up as an example to follow, or at least to study, to learn from.

With the specter of a full-blown depression looming, the Age of Roosevelt—the campaign he ran in 1932, the challenges he faced upon assuming office, the “bold, persistent experimentation” he called for and the New Deal edifice he erected in response—is much on the minds of the nominee and his inner circle. “A lot of people around Barack are reading books about FDR’s first hundred days,” says a member of Obama’s kitchen cabinet. “It’s a sign of the shift that’s going on emotionally: from being on this improbable mission to believing, Hey, we’re going to win.

It is quite clear that he is going to win; doubters and naysayers, let alone conservatives in denial, might beg to differ, but they are being delusional.

... as the outcome of the race has begun to seem more certain with each passing day—with Obama’s lead in the polls healthy and showing few signs of diminishing, with John McCain’s campaign listing aimlessly and lapsing into rank self-parody, with Sarah Palin devolving into a human punch line—Democrats are slowly, haltingly allowing themselves to believe that victory is truly within their grasp, and hence to contemplate what comes next. Transition. Inauguration. Those first hundred days. Maybe even, perchance, with augmented majorities for the party in both the House and Senate all but in the bag, the dawning of a spanking-new era of Democratic dominion.

In 1992 Clinton's election made it seem that a new Democratic Era was beginning; but then he pursued that dreadful don't ask don't tell policy, pursued health care reform too early, and by 1994 Gingrich was on the ascendancy. And now Obama faces economic catastrophe; when Clinton took office a mild recession was ending.

All too aware that, should he win, these cascading crises will leave Obama with no time to gain his sea legs and terrifyingly little margin for error, he and his people, to a degree few realize, have been planning their transition from campaigning to governing for months with characteristic care and rigor. Like so much about Obama’s historic bid for the presidency, the first few days and weeks and months will be like nothing we have seen before—and all of it grounded in the insight that, mind-boggling as it might sound, winning was the easy part. These are Democrats they’ll be dealing with, after all.

After abandoning Michigan, McCain is counting on and devoting great resources to winning Pennsylvania as a last gambit to stop the Obama onslaught.

More than a few Republican strategists, however, regard the Pennsylvania gambit as desperate and doomed. “They’re smoking crack,” says consultant Alex Castellanos. “It’s one thing for a working-class Democrat to vote against Obama on culture in a Democratic primary. You’re still voting for a Democrat; you still get to be a Democrat. But to vote for McCain, you have to become a Republican. I don’t see it.” “There’s a reason we haven’t won Pennsylvania since 1988: It’s a Democratic state,” says another GOP guru. “Obama is ahead by double digits. And if McCain rolls out the Wright thing there, the national backlash will be huge, and moderate states like Florida will disappear as opportunities.”

As Obama rolls on to victory, winning additional Senate and House seats takes on added importance to allow the Democrats to dictate the legislative agenda in the next Congress.

What happens at the ballot box is just the first step toward building a stable, lasting majority. As Democratic Leadership Council president Bruce Reed puts it, “The battle for realignment starts the day after the election.” It starts, in other words, with the transition—the first test of Obama’s mettle.

I think he's a very good politician, a magnificent organizer, and his campaign shows he knows how to assemble a good team and let it work. But governing is a different ball of wax. It begins with the transition, and initial Cabinet appointments.

It should come as no surprise that No Drama Obama wants his transition to be nothing like that of Chaotic Clinton’s. Already his pre-transition is exhibiting the kind of order and discipline (and lack of leaks) that have been the hallmarks of his campaign.

Given the unusually crisis-plagued environment into which Obama will be stepping, he will want to move quickly, especially when it comes to selecting his Cabinet. Almost certain to come first, perhaps within days, will be his economic and national-security teams. And with those choices, they say, he will want to send a message of centrism and bi-partisanship. It’s conceivable that Obama will ask Bob Gates to stay on as Defense secretary; Chuck Hagel, too, might find a place high in the administration. But although there has been chatter that Obama might also retain Hank Paulson at the Treasury, the inside betting is on a Larry Summers encore. “They’re gonna want somebody who knows the building, knows the economy, has been confirmed before and been advising them on economics,” says the former Clinton aide. “I’d be flabbergasted if they chose somebody else.”

Hagel would be a great choice. Gates should be allowed to go gracefully. Paulson? I don't see that being a prudent choice: Paulson is Bush's man, and the economic explosion happened even as he had a bazooka he thought he wouldn't have to wield. Nah.

Obama has no inbuilt animosity toward the congressional leadership. Sure, he vowed to transform Washington, but he did not run against it. He is surrounded by people—Emanuel, Podesta, former Tom Daschle aide Pete Rouse, and Daschle himself, who stands a reasonable chance of being Obama’s White House chief of staff—steeped in the legislative culture and masters of the legislative arena.

Daschle sounds a good choice: working with former colleagues would make him a popular choice, one would think, sending a signal that the Administration will work with, not fight with, Congress.

Not that dealing with a pair of institutions led by Nancy Pelosi and Harry Reid will be any kind of picnic. “They’re incredibly weak leaders running a Congress with 12 percent approval ratings,” one Democratic think-tank maven says. “They’re not people with much of a record of, you know, actually getting things done.” Making matters worse, Obama will be hounded constantly by the old-school liberal interest groups, with all their bottled-up desires and demands. The unions, the health-care groups, the teachers, and so on: Everyone will have their hand out.

I sure do hope he makes his toughness clear; he does seem decisive. He'll need resolve, along with everything else.

“My view is that we gotta be the party of reform,” Emanuel begins when I reach him on his cell phone. “There are four reforms. There’s financial-regulatory reform, tax reform, health-care reform, and energy. Regulatory will kinda come down the chute fast. Tax reform will take a little longer, because it’s not until 2010 that Bush’s tax cuts expire. Energy, you can do some things immediately. And with health care, you’ve got the children’s health insurance as the first piece of a series of things you gotta do.”

Rham Emanuel worked for Clinton; he has become quite an accomplished legislator.

Already Obama is hinting strongly at what his priorities will be. Consistent with what Emanuel told me, Obama now informs Time’s Joe Klein that endeavoring to spark “a new energy economy [is] going to be my No. 1 priority when I get into office.” At the same time, Obama will surely press immediately for his middle-class tax cut, which happens to be sound economics in recessionary times and also irresistible politically.

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