HILLARY’S INCREDIBLE, SHRINKING ROLE
Published on TheHill.com on February 9, 2009
Secretary of State Hillary Rodham Clinton is finding that her job description is dissolving under her feet, leaving her with only a vestige of the power she must have thought she acquired when she signed on to be President Obama’s chief Cabinet officer.
Since her designation:
- Vice President Biden has moved vigorously to stake out foreign policy as his turf. His visit to Afghanistan, right before the Inauguration, could not but send a signal to Hillary that he would conduct foreign policy in the new administration, leaving Hillary in the role of backup.
OUR DEADLY DEBT: HOW ‘STIMULUS’ PROLONGS PAIN
Published in the New York Post on February 9, 2009
From Nouriel Roubini, the economist who most closely predicted the current mess, comes a warning couched in economic jargon that needs to be deciphered and publicized.
In a column on Forbes.com, Roubini warns that the United States, in its response to the economic crisis, may be following in the disastrous footsteps of Japan – whose sluggish and overly lenient response to a financial crisis led to a decade of economic misery.
In economic jargon, Roubini warns: The “market-friendly, case-by-case approach to the necessary debt reduction of insolvent private non-financial agents – corporate for Japan, households for the US – will be too slow.” He calls for an “across-the-board debt reduction” – lest we be condemned to a “systemic debt overhang.”
WHY BERNIE GOLDBERG HAS IT RIGHT
Theodore White wrote The Making of the President: 1960, a book which fascinated all political junkies as it recounted the ways and methods of the Kennedy triumph. He followed that volume with successor books each four years. The premise of each book was that by following what was happening in the two campaigns, he could fully cover all that was taking place in the election. Newsweek Magazine seeks to perpetuate his methodology in its quadrennial summaries of the election campaigns published shortly after Election Day.
But such summaries miss the essential point: The reality of modern campaigns cannot be covered by discussing what the candidates, managers, and staff are doing. It can only be fully understood by covering what the media is doing during the campaigns. That is why Bernie Goldberg’s new book A Slobbering Love Affair: The True (And Pathetic) Story of the Torrid Romance Between Barack Obama and the Mainstream Media, despite its long title, is so important to read. It is not a supply side treatment of the campaign – focusing on what the candidates were putting out to the public. Rather, it is a demand side treatment, covering what the public was absorbing through the media.
OBAMA AT THE CROSSROADS
Now Obama has to decide whether he will govern from the center or from the left. In 1993, Bill Clinton faced the exact same decision, also over an economic stimulus package. His Congressional allies from his own party wanted him to fill the package with every manner of pork spending they wanted. They promised him undying support, but Clinton realized that, if he followed their lead, he would get no Republicans.
The united opposition of the House Republicans to the Obama package sent the same message to the new president. And his inability to collect enough votes in the Senate, despite his top heavy majority, amplifies it.
OBAMA DEFINES HIMSELF AS A PARTISAN
President Obama’s speech on national television was a declaration of his intention to use his top-heavy majorities in both houses of Congress to ram his program through. Despite lip service to bipartisan government, he indicated that his basic approach is: My way or the highway.
How will Republicans react? If they permit themselves to be intimidated out of a filibuster by Obama’s efforts to summon massive public momentum, they will never again be relevant to America’s politics during the next two years. If they let themselves be bought off individually for small concessions, like the homebuyer tax credit, they will squander whatever power their 41 seats gives them.
OBAMA MUST AVOID CLINTON’S MISTAKE
In 1993, President Clinton pushed an economic stimulus package of the then-large amount of $35 billion. Promising to “focus like a laser beam” on the economy, he consulted with his Democratic majorities in both houses in formulating his proposal.
As a result, it was loaded with every possible liberal Democratic spending item and crammed with pork targeted at specific Democratic House districts. Repelled by the pork, not a single Republican backed the bill and, with national public opinion turning against it because of the spending, it failed.
KEYNESIAN FALLACY
Publish on TheHill.com on February 3, 2008
There are very few economists who really buy into Keynesian theory anymore. Instead, the idea of “rational expectations” has taken its place. The difference between the two approaches is essential to understanding why Obama’s stimulus package won’t work.
Keynes felt that people would react automatically to a few dollars in their hands. Consumers would run out and buy new products, and businessmen, seeing the uptick in sales, would rush to open new plants and hire new workers who would, in turn, generate more demand.
DEFEAT OBAMA’S STIMULUS PACKAGE
Dear Friend,
As you have probably gathered from my past few columns, I am very critical of the stimulus package proposed by the president. I believe it won’t do much to stimulate the economy since consumers will use the checks to pay bills and pay down debts and businesspeople will invest it waiting for better times. The rational expectations theory that is replacing strict Keynesian economics as the consensus among economists dictates that people won’t automatically spend what they get but will take into account their concerns about the future of the economy. The fact that personal savings grew in January for the sixth straight month and are now at the highest rate in six years indicates that this is what is happening.
I also worry about what happens when all that money comes out of hiding and floods the economy when confidence returns. It will usher in a year or two of horrible inflation which will require its own recession to cure as it did in 1981-2.
As I did during the election, I am working with the National Republican Trust to do what I can to stop this package from passing. They will be running ads in key states to build sentiment against it to convert conservative Democrats and stiffen the spine of the Republicans in the Senate. Please help by contributing at GOPTrust.com. If we can modify or defeat this package it will save all of us a great deal of pain and suffering down the road.
Thanks,
Dick Morris
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