Wednesday, April 15, 2009

Where's the Backbone?

Ms Marcus: Where what are your creds? BO has been succesful NOT follwoing standard thinking as in your column. WAIT and see WHAT IF BO succeeds?

Where's the Backbone? By Ruth Marcus

When will President Obama fight, and when will he fold? That's not entirely clear -- and I'm beginning to worry that there may be a little too much presidential inclination to crumple. For all the chest-thumping about making hard choices and taking on entrenched interests, there has been disturbingly little evidence of the new president's willingness to do that when it discomfits his allies.

"Our time of standing pat, of protecting narrow interests and putting off unpleasant decisions -- that time has surely passed," Obama proclaimed in his inaugural address.

Well, not exactly. Look at the fate of various proposals in the Obama budget, and the question that arises is not Walter Mondale's famous "Where's the beef?" It's "Where's the backbone?"

Granted, it's early -- too early to know whether this anxiety is justified. No president gets everything he proposes, in the budget or elsewhere. Picking battles is part of the art of presidential politics.

Just ask Jimmy Carter, who picked the wrong one with Congress, early on, over lawmakers' cherished water projects -- and then blinked on a veto. "That convinced people that he was not willing to stick to tough positions," Carter adviser Stuart Eizenstat recalled in a 1982 oral history.

But, if, as Machiavelli advised, it is better for a leader to be feared than loved, it's fair to ask whether Obama has been scary enough. Leave aside Republicans -- among Democrats in Congress, who's afraid of Barack Obama?

-- Item: Obama proposed ending automatic subsidy payments for farmers taking in more than $500,000 a year and capping payments at $250,000 -- along the lines of a failed Bush administration foray.

"More than dead on arrival," pronounced Minnesota Democrat Collin Peterson, chairman of the House Agriculture Committee -- and so it seems to be, with nary a peep from the president. Neither the House nor Senate budget outlines include any limits on farm subsidies.

-- Item: Obama proposed ending the lucrative program of federal subsidies for private banks making student loans, saving nearly $100 billion over the next decade by having the government make loans directly -- much as the Clinton administration had attempted years before.

Result: The Senate version of the budget resolution pointedly noted the chamber's backing for "a competitive student-loan program . . . with a comprehensive choice of loan products and services." The House version urged options "that will maintain a role for [bank] lenders." In other words, don't count out the banks anytime soon.

-- Item: Obama didn't even get around to proposing a change that would allow the Department of Veterans Affairs to bill private insurers, in the case of veterans who have such coverage, for service-related injuries. After an outcry from veterans groups, a slap-down from lawmakers and a stormy meeting between veterans and White House chief of staff Rahm Emanuel, the administration backed down.

I could go on. The worthy notion of limiting tax deductions for the wealthiest Americans? Aired and, at least for now, dropped. The idea of a commission to deal with Social Security? Not even aired. The president wants to keep the estate tax at its current level, with a generous $7 million-a-couple exemption; that wasn't good enough for some Senate Democrats, who defied him by endorsing a bigger gift to the wealthy.

And one of the biggest ideas -- enacting a cap-and-trade system to deal with climate change -- is nowhere to be found in the budget blueprint.

So forgive me if I listened to Defense Secretary Robert Gates last week outline a series of smart and sensible changes in defense spending and thought, "Good luck with that." Parts for the F-22 fighter jet that Gates wants to stop buying are manufactured in 44 states. Is the president really going to take on this battle?

Obama advisers argue that both houses' budget resolutions hew closely to the president's plan. As budget chief Peter Orszag put it, "The resolutions may not be identical twins to what the president submitted, but they are certainly brothers that look an awful lot alike."

More important, aides say, the final product is likely to provide for passage of health reform by a majority vote if the Senate is gridlocked this fall. That could pave the way for a major victory -- enough to erase memories of compromises and capitulations.

In the weeks ahead, the challenge for the president is to avoid ceding so much that he undermines his own strength. This is not easy to calibrate. Machiavelli's prince, after all, didn't have to deal with committee chairs.

Reviews of BO's economics complied NYTimes

Reviews for Obama’s ‘Sermon on the Mount’
By Eric Etheridge
American Prospect: Ezra Klein says President Obama’s economic speech yesterday at Georgetown University (read the full text; watch it) was “far and away the most coherent and sustained account of Obama’s agenda that the White House has yet offered.”

Huffington Post: Jacob Heilbrunn says that Obama was “cranking high voltage to jump start the shift toward a new American economy.”

President Obama’s audacious economic address at Georgetown University today provided the last swing of the wrecking ball for the shattered remnants of free market fundamentalism. Even as dazed and disoriented members of the GOP stumble around the ruins in a state of cataleptic shock, mumbling over and over to themselves the consolatory phrase that Obama is a socialist, the president doesn’t simply want to tinker with the economy; he’s aiming to lay an entire new foundation over the shards of the failed one. His talk laid out a comprehensive program for what might be called the four R’s: reform, regulation, restructuring, and revival.

Time: Joe Klein says the speech was “quite good.”

In the welter of standard media events and promotions–the White House release of an elaborate pirate tick-tock, for example–there is also a steady effort by the President to speak to us as if we were adults. I’m not sure how much of an impact it’s having, but speeches like this one–and his budget message to the Congress–really raise the level of discourse. You may disagree with his ideas, but he’s not fudging or spinning here. It is a clear, coherent philosophy of governance. And even though none of this is new, it is good to be reminded how all the pieces fit together.

The Atlantic: James Fallows notes a few things he liked about Obama’s speech, inlcuding:

Obama crafted the message with an intellectual thoroughness and emotional steadiness that I think will impress its real audience: not the students sitting at Georgetown or those like me watching live, but the politicians, financiers, and members of the commentariat who will read the text and respond after a little while. He showed he was aware of criticisms and was willing to state them in recognizable form before offering his rebuttal. (Think of the contrast of GW Bush or Cheney acknowledging criticism of their strategy and world view. Or even Richard Nixon.)

And a few things he didn’t like, including:

Maybe it’s only veterans of the Carter Administration who remember this, but “new foundations,” a leitmotif of this speech, was also the motto of one of Carter’s State of the Union addresses 30 years ago. The phrase didn’t catch on then. Or maybe it’s been three decades in gestation.

The Nation: Katrina vanden Heuvel says Obama’s speech was good as far as it went, but that “real and grounded concerns about the administration’s bank bailout plan remain.”

While Obama’s speech lays out some strong principles for a new foundation, the administration’s financial team remains unwilling to understand that we’re not just going through a financial crisis or a panic, but the failure of a whole model of banking. We are living amid the blowback of an overgrown financial sector that did more harm than good.

If this realization begins to sink in through the failure of the current plan . . . then we’re on the road to laying the foundation, the rock, for a new economy.

Washington Post: Dan Froomkin says the president “failed to persuasively rebut the most urgent critique of his economic policies — one that can’t be written off either to reflexive partisanship from Republicans or defensiveness from the Washington establishment.”

Obama raised it on his own, noting that some critics think he has “been too timid” about shoring up the banking system. “This is essentially the nationalization argument that some of you may have heard.” . . .

But his answer was vague and unconvincing . . .

Obama’s belief has never been in question. It’s the reasoning behind that belief that we’ve been missing, as well as the source of his faith in the judgment of economic advisers. But he once again left us all in the dark on that count.

Clusterstock: Henry Blodget says “Every time we watch Obama speak, our confidence is restored.” But:

That said, we wish Obama didn’t spend so much time hanging out with Tim Geithner and Larry Summers, who we assume are responsible for the mistakes Obama continues to make in his diagnosis and treatment of the banking problem.

Plumline: Greg Sargent says it was “noteworthy” that Obama “went out of his way to argue that he isn’t ideologically predisposed against bank nationalization and aggressively rebutted claim that his administration has at times been ideologically predisposed towards letting Wall Street execs off the hook.”

This isn’t a point Obama really needed to make. He could have said that he viewed his prescriptions as more practical than theirs and left it at that.

In a sense, this throws a bit of a wrench into the claim we keep hearing that “Obama is a pragmatist, not an ideologue.” Obama, in a way, is rejecting this frame. He merely has a substantive disagreement with his liberal critics about what would work and what wouldn’t. He’s not rejecting their ideas because they are mired in ideology and his aren’t or because he’s a pragmatist and they’re too far to the “left.”

National Review: Kathryn Jean Lopez wonders about possible changes to the hall where Obama spoke:

Readers have e-mailed that the “IHS” above the Gaston Hall auditorium stage at Georgetown University (a purportedly Catholic school) seems to have gone missing for the presidential economic address earlier today. Perhaps someone wanted to avoid confusion, given that his speech was presented as an economic Sermon on the Mount?

In all seriousness, if the Jesuits there thought removing or otherwise obscuring it would suggest less endorsement of his views (say, on human life . . .), perhaps that was a wise prudential call. But if the White House asked, I think the White House should have been requested to give the speech at George Washington University instead.

Ron Paul's plan to fend off pirates

Ron Paul's plan to fend off pirates
Erika Lovley

A little-known congressional power could help the federal government keep the Somali pirates in check — and possibly do it for a discount price.

Rep. Ron Paul (R-Texas) and a growing number of national security experts are calling on Congress to consider using letters of marque and reprisal, a power written into the Constitution that allows the United States to hire private citizens to keep international waters safe.

Used heavily during the Revolution and the War of 1812, letters of marque serve as official warrants from the government, allowing privateers to seize or destroy enemies, their loot and their vessels in exchange for bounty money.

The letters also require would-be thrill seekers to post a bond promising to abide by international rules of war.

In a YouTube video earlier this week, Paul suggested lawmakers consider issuing letters, which could relieve American naval ships from being the nation’s primary pirate responders — a free-market solution to make the high seas safer for cargo ships.

“I think if every potential pirate knew this would be the case, they would have second thoughts because they could probably be blown out of the water rather easily if those were the conditions,” Paul said.

Theoretically, hiring bounty hunters would also be a cheaper option.

National security experts estimate that this week’s ship captain rescue by Navy SEALs cost tens of millions, although a Navy spokesman says the military cannot confirm the exact cost of the mission.

Instead, privateers would be incentivized to patrol the ocean looking for key targets — and money would be paid only to the contractor who completed the job.

“If we have 100 American wanna-be Rambos patrolling the seas, it’s probably a good way of getting the job done,” said Competitive Enterprise Institute senior fellow and security expert Eli Lehrer. “Right now we have a Navy designed mostly to fight other navies. The weapons we have are all excellent, but they may not be the best ones to fight these kinds of pirates. The only cost under letters of marque would be some sort of bounty for the pirates.”

According to Senate historians, Congress hasn’t issued a letter of marquee since the War of 1812, but the Confederate States of America issued them during the Civil War to deliver supplies behind enemy lines. There are also some indications that a letter was granted to a flying band of armed civilians during World War II to operate the Resolute, a Goodyear Blimp used to patrol the ocean for enemy submarines, but the issuance isn’t apparent in the Congressional Record.

If Congress were to revisit the antiquated process, a serious makeover would be required.

In the past, privateers were allowed to keep the ship and treasure they captured in an enemy encounter.

“That isn’t a viable way of funding in today’s world,” said Lehrer. “These pirates don’t really have treasure chests, and their money is tied up in Swiss Bank accounts. Congress would probably have to attach sizable bounties to people.”

Bounties are not a new idea — there is still a $25 million bounty on Osama bin Laden, and millions have been awarded by the government for other enemy captures.

The U.S. State Department earlier this month put a $5 million bounty on the head of the top Pakistani Taliban leader, and even local police departments use rewards to solve cold cases.

University of Oregon economics professor Bill Harbaugh argues the setup could potentially work better than some of the United States’ relationships with modern-day security contractors.

“Obviously, this is somewhat like the contract the government had with Blackwater, except we forgot the bond part of the contract, he said. “If Congress had used this contract from 1776, it would have been more sophisticated than the one they issued with Blackwater.”

Harbaugh’s fifth great-grandfather, Silas Talbot, worked as an early privateer for the United States in 1780 after serving in the Revolutionary War. His letter of marque shows he set out with 12 carriage guns and a crew of 50 men to attack and seize cargo ships coming from Great Britain on the high seas.

Could it really work again?

“It may work in the sense that if you give people incentives to fight piracy, you’ll see more action taken against it,” said Andrew Grotto, a senior national security analyst with the Center for American Progress. “The ocean is huge and, practically speaking, there’s no way the Navy can prevent piracy; it’s too big. But just given the experience in Iraq with private contractors, that effort showcases the difficulties dealing with folks who aren’t answerable to anyone but shareholders.”

But Paul has already thought through a number of these updates.

Days after Sept. 11, Paul introduced legislation allowing President Bush to allow private citizens to go after Osama bin Laden and other identified terrorists and put a bounty price on the heads of targets responsible for the New York attacks. Contractors would also be required to post a play-by-the-rules bond and turn over any terrorists — and their seized property —to U.S. authorities.

“The Constitution gives Congress the power to issue letters of marque and reprisal when a precise declaration of war is impossible due to the vagueness of the enemy,” Paul wrote in a press release. “Once letters of marque and reprisal are issued, every terrorist is essentially a marked man.”

But national security experts and legal analysts warn that applying a colonial-era policy to a modern-day problem could be wrought with legal pitfalls that the Founding Fathers never encountered.

If bounty hunters chase pirates into territorial coastal waters or on to the shore of another country, the problem would fall under the jurisdiction of that country. And any plundering activity that takes place in coastal waters is no longer considered piracy, according to College of William and Mary national security law professor Linda Malone.

Not to mention that there’s also no clear indication where and how the captured pirates should be prosecuted.

“You have to find a stable court system nearby to have them tried for these offenses, but that can be quite complicated,” Malone said. “The fact that the pirates are from Somalia doesn’t make them state actors. They are doing this for private gain.”

And how to determine exactly who is a pirate — and what constitutes pirate activity — could get fuzzy.

“What happens when a ship flying under Congress accidentally takes out an aid ship bound for Somalia?” Grotto said. “At what time does an act seem pirate-like enough to cross the line? Do we really want these snap judgments being made on the fly in waters thousands of miles away from Washington? This is not Johnny Depp we’re dealing with.”