Sunday, June 17, 2012

Escape Artists & Tea Party Nihilists

A side benefit of political conflict is that it makes a great excuse for the churning of books detailing those squabbles.  Two recent ones that came across my night table are Noam Scheiber's The Escape Artists and Robert Draper's Do Not Ask What Good We Do. The former focuses on President Obama's struggles to heal our economy, while the latter focuses more on the first year of the 112th Congress led by Speaker John Boehner. 

While Scheiber tags the Obama team as "escape artists," it is not the first way I would describe them.  My choice would be "little c" conservative - not the stuff of a book title, but a more apt adjective for their policy making.  Indeed, what Scheiber argues is that the President's decision making regarding Wall Street, the economy and the federal budget is probably closer to George H.W. Bush than Franklin Delano Roosevelt.  For example, the main protagonist of Scheiber's story is Treasury Secretary Tim Geithner, who cut his teeth as an aide in the U.S. Embassy in Japan during the first Bush Administration before moving to the Treasury Department prior to Bill Clinton's arrival in Washington then swiftly working his way up the ladder by ingratiating himself to Clinton heavyweights Robert Rubin and Larry Summers before moving to the New York Federal Reserve under George W. Bush. Geithner comes across as nothing more than a bloodless technocrat who is reflexively cautious and protective of the Wall Street status quo. When given the choice between saving Wall Street and Main Street, Geithner reasoned that saving the former was essential, while the latter was not, because capitalism itself could not survive the collapse of Wall Street, while ordinary Americans could limp along until things got better. 

Scheiber describes how Geithner insinuated this world view into the upper echelon of the Obama team, even though had presided over a New York Fed that was accommodationist to the extreme during the heyday of the housing bubble. Geithner deftly commands the stage against powerful economic voices like Larry Summers (brilliant but lacking the ability to manage policy) and Christina Romer (out of her depth at first and marginalized by the time she gets her sea legs). For example, Romer had already been cowed before Obama's inauguration into trimming her estimate of the stimulus needed to right the economy (she estimated $1.8 trillion over two years) because of political considerations and Geithner outmaneuvered Summers by proposing the so-called "stress tests" for banks as a way to both stave off any attempts to break up or nationalize banks and to provide elusive "confidence" to the market while Summers never offered a viable alternative. 

Readers who want a more granular level of analysis of these crucial months in Obama's history are commended to read Ron Suskind's Confidence Men, because Scheiber's lens is broader than just those early months when the Recovery Act was passed or even the year long slog through the health care debate. After those battles, we see the Obama team lurching to satisfy what it thinks is popular opinion - first in embracing deficit and debt reduction in response to the Tea Party and then swinging to the opposite extreme in calling for more stimulus through infrastructure spending and aid to states after the Republicans bloody Obama's nose over and over in "hostage taking" policy showdowns over the federal budget and debt ceiling.  This is not to say that Obama was adrift, but Scheiber paints a picture of a pragmatist-in-chief without a clear North Star guiding his policy. In the absence of any core belief (the closest Scheiber comes is his observation that at heart Obama is a deficit hawk) what Obama and his team are left to do is make policy decisions on the fly.  Ironically, the economic result is not far from Romer's $1.8 trillion estimate, but because Obama was unwilling to fight for that larger amount in the first place, and could have shaped and directed it, the second stimulus ended up being predominately tax cuts, much of which was directed at the wealthy and whose stimulative effect on the economy was not nearly as powerful as the money would have been if put into rebuilding roads, bridges and dams, and sending aid to states so they would not lay off public workers. 

Ultimately, The Escape Artists begs the counter factual - the "what if" of Obama's policy making.  Not just with the miscalculation on the amount (and breakdown) of the Recovery Act, but missed opportunities to help the housing market, to go small on health care and take a harder line against the banks. Scheiber's thesis will no doubt infuriate liberals and progressives who believe Obama insufficiently committed to aiding (and protecting) the middle class and will surprise conservatives (if they are willing to take their blinders off) at Obama's caution and deference to "the market" when it came time to make the truly hard decisions.  While Obama may sound like a progressive, he acts like a moderate. What I was struck by was the good faith effort Obama and his team put forth - they wanted, desperately, to do what they thought was right, but their actions fell woefully short. They thought trying to bring Republicans into the policy conversation would bear fruit when all it did was solidify their opposition, they thought aiding Wall Street would curry favor with the titans of the banking industry, but all they got was a steady outflow flow of campaign contributions to Mitt Romney, and they thought handing the health insurance industry 30 million new customers would be a market-based reform, but instead they got a lawsuit that may strike the whole thing down. 

The other side of the legislative coin is explored in Robert Draper's Do Not Ask What Good We Do, which looks at the first year of the 112th Congress and the impact the more than eighty freshmen Republican legislators had on that institution. Draper's book will not uplift those who hold out hope that our nation's leaders will accomplish anything anytime soon.  If anything, Draper's book will reinforce the idea that their 9 percent approval rating notwithstanding, many of the so-called Tea Party Republicans, sheltered by favorable redistricting maps, are no more interested in negotiation or compromise than the day they were sworn in.  If anything, they are more opposed to it than ever. Indeed, what is glaringly obvious from Draper's narrative is that while the Republican Party in Congress marches in lockstep opposition to President Obama, there is a smaller faction within the House Republican Caucus that pulls the same stunt against its own leadership. 

The result of this intransigence is not pretty, but Draper appears more interested in shading in the scenery than narrating this blood duel.  Long stretches of the book provide biographical and background information about better known (at least to political junkies) elected officials like John Dingell and Kevin McCarthy and upstart freshmen like Allen West, Renee Ellmers and Jeff Duncan.  The result is not unpleasant, but not particularly illuminating either. Where Draper does a better job is providing insight into the horse trading that is inevitably part of the legislative process.  For example, he shares an anecdote about how money was secured to deepen the Port of Charleston to allow more ships to use it as a hub. Of course, the South Carolina delegation is among the most conservative in Congress, but when it comes to finding federal dollars to support something in their state, the orthodoxy has a funny way of being bent. They are more than happy to try and lobby their Committee chairmen for money, but get stiffed, in part because of personal pique at the agita these freshmen have created.  Ironically, it is left to the delegation's lone Democratic member, James Clyburn, to "make a call" to a friend in the executive branch who dutifully (and paperlessly) transfers the needed money.  

What should strike readers as offensive is not the subtle way "Washington" worked in this particular case, but the bald faced hypocrisy of these so-called fiscal conservatives, who publicly denounce the expansion of the federal government, disclaim any notion that public money creates jobs and banned so-called "earmarks," while privately seeking tax dollars to support a pet project, which, incidentally, would help maintain and create jobs in South Carolina. Perhaps that 9 percent approval rating would move a bit were members willing to acknowledge that federal money spent toward projects like deepening a port's traffic lanes is salutary, but to do so would require an admission that government can work, something the Tea Part crowd is simply unwilling to do. 

The set piece of Draper's book is the forty-three page chapter aptly tilted "The Hostage."  What Draper adds to the now thorough examination of the debt ceiling debate is the breath taking cynicism and shamelessness of Republican leaders who, unable to marshal the votes to pass the debt ceiling deal on their own (even with a 25 seat majority), with a straight face ask Democrats to produce 100 votes of their own.  As Draper notes, having gotten "ninety eight" percent of what they wanted out of the deal, Republicans now wanted Democrats to cut their own throats by providing nearly 50% of the votes for the bill.  And guess what? They did. For those who consider game theory in politics, it should be unsurprising - Democrats have provided crucial votes on everything from No Child Left Behind to the Iraq War resolution.  Democrats, as they usually do, did the "right thing" to ensure our bills were paid even though they received nothing in return.

Of course, the vote was distasteful. House Democrats had a right to be unhappy.  Having been ignored by Obama when she advised him to raise the debt ceiling in the 2010 lame duck session, Nancy Pelosi swallowed hard and voted for the bill.  Congressman Dennis Cardoza is quoted as calling Obama "the worst negotiator" in the history of the Presidency and Congressman Emanuel Cleaver laments how Obama ignored his entreaty to not slash block funding to cities that, when Cleaver was Mayor of Kansas City, had helped fund critical infrastructure projects. His plea fell on deaf ears. Here, the narratives between Draper's book and Scheiber's converge neatly. Both portray a timid White House eagerly looking to cut deals and get to resolutions while compromising away meaningful ground. As Congressman Jon Runyan, a former offensive lineman with the Philadelphia Eagles observes when speaking about the debt ceiling debate, the Republicans were winning the game of field position against the White House, accumulating small victories along the way. 

To add insult to injury, the spectacle of wounded member Gabrielle Giffords appearing on the floor to vote for the bill allowed members the cover of "bipartisan" fervor to push the bill across the finish line.  While conservative Republican freshmen legislators prayed for guidance, they seemed divorced from the reality of how the debt was accumulated (overwhelmingly by passing massive tax cuts under two Republican Presidents, a massive arms build up, failing to pay for Iraq & Afghanistan, Medicare D) and by who (predominately Republican Presidents dating to Reagan's "deficits don't matter" policies of the 1980s). But on this, there was no bending.  As Speaker Boehner lamented, unlike in prior Congresses, where earmarks and federal funding could be used to grease the wheels to get votes, left solely to his powers of persuasion, many freshmen simply tuned him out. 

Indeed, Boehner does not come off well in Draper's story.  His old school way of doing things, of shmoozing other members, chumming it up in smoke filled rooms behind closed doors and keeping a modest schedule (apparently, anything past 10 P.M. is off limits for him) made him particularly ill-suited to run a Congress stocked with flame throwing conservatives. Boehner is portrayed as passive, unwilling to instill discipline in his "troops," and, at best, managing the unruly host of freshmen sent to Washington in 2010, instead of leading them.  Denuded of the traditional carrots and sticks that prior Speakers had at their disposal to incentivize or punish members, Boehner comes across as impotent, eager only to placate his restless base of Congressmen to keep his position. 

Books like these are important to read as background for the months to come.  Regardless of who wins the Presidency in November, Congress and President Obama have two major policy battles ahead of them - the expiration of the Bush tax cuts and the automatic "sequestration" cuts delineated in last year's debt ceiling deal have to be addressed before the end of this calendar year. Longer term, and regrettably for Democrats, what both books suggest is that when push comes to shove, Democrats will go more than halfway to placate Republican demands, which is one thing when your guy is in the White House, but a dangerous thing if he is not.  

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