Barack Obama has succeeded where Hillary Clinton failed. She hoped to win a third Clinton term, but it is her vanquisher who is reconstituting the Clinton administration.
Obama’s nominee for treasury secretary, Timothy Geithner, served under Clinton Treasury Secretaries Robert Rubin and Larry Summers. Summers himself is Obama’s choice to head the National Economic Council. Both are part of Rubin’s circle, known for its brains and its relative moderation.
Few would have guessed back when Obama rose from the snows of Iowa that highly experienced economic technicians would represent “change we can believe in.” Thankfully, Obama’s airy rhetoric about a new kind of politics was more a pitch for impressionable new voters than a description of his governing style.
So far, President-elect Obama has acted with a ruthless pragmatism. He ignored the yowling left-wing blogosphere when it demanded Joe Lieberman’s head, turned to the initially pro-Iraq War Hillary Clinton for his top foreign-policy job, and staffed up with former Clintonites. Obama has been a shape-shifter throughout his brief political career, and the latest shape – an establishment Democrat determined to do whatever works – is the best version yet.
Obama appears to be reconsidering for now his promised repeal of President Bush’s “tax cuts for the rich.” Twice during the primaries, Obama hinted that he might put off the tax hikes if the economy was in distress, but he could never admit what was obvious: Proposing tax increases in the teeth of a recession was madness.
If Obama is wise, he’ll not only jettison his plans for a tax increase that in aiming at the rich would also hit successful small businesses, but also will put off his plans for a “cap-and-trade” program to tax the use of fossil fuels, forswear all his protectionist sentiments from the primaries, and ditch his support for a “card check” plan to promote the unionization of the American work force. Anything that burdens business should be anathema to Dr. Fix-the-Economy.
For now, the showpiece of Obama’s economic program is a massive stimulus bill that the Democratic Congress wants to have ready for his signature as soon as he departs the Capitol Hill steps after his inauguration. Even some conservative economists believe a fiscal stimulus is necessary to keep us out of a deflationary spiral, but Obama is only asking a Democratic Congress – given to fiscal incontinence even in rosy economic circumstances – to do what comes naturally.
We can’t know what new twists the crisis will take. We do know that Obama will need more than a ruthless pragmatism to navigate through it. In his masterly “The Great Inflation and Its Aftermath,” Robert Samuelson chronicles the extraordinary stalwartness of President Ronald Reagan when he allowed Federal Reserve Chairman Paul Volcker to squeeze inflation painfully out of the economic system the last time we had a downturn this severe, in 1981-1982.
That took guts. Obama will need them as well, and they won’t be on loan from any adviser, no matter what his pedigree.
Lowry is editor of the National Review.
Obama’s nominee for treasury secretary, Timothy Geithner, served under Clinton Treasury Secretaries Robert Rubin and Larry Summers. Summers himself is Obama’s choice to head the National Economic Council. Both are part of Rubin’s circle, known for its brains and its relative moderation.
Few would have guessed back when Obama rose from the snows of Iowa that highly experienced economic technicians would represent “change we can believe in.” Thankfully, Obama’s airy rhetoric about a new kind of politics was more a pitch for impressionable new voters than a description of his governing style.
So far, President-elect Obama has acted with a ruthless pragmatism. He ignored the yowling left-wing blogosphere when it demanded Joe Lieberman’s head, turned to the initially pro-Iraq War Hillary Clinton for his top foreign-policy job, and staffed up with former Clintonites. Obama has been a shape-shifter throughout his brief political career, and the latest shape – an establishment Democrat determined to do whatever works – is the best version yet.
Obama appears to be reconsidering for now his promised repeal of President Bush’s “tax cuts for the rich.” Twice during the primaries, Obama hinted that he might put off the tax hikes if the economy was in distress, but he could never admit what was obvious: Proposing tax increases in the teeth of a recession was madness.
If Obama is wise, he’ll not only jettison his plans for a tax increase that in aiming at the rich would also hit successful small businesses, but also will put off his plans for a “cap-and-trade” program to tax the use of fossil fuels, forswear all his protectionist sentiments from the primaries, and ditch his support for a “card check” plan to promote the unionization of the American work force. Anything that burdens business should be anathema to Dr. Fix-the-Economy.
For now, the showpiece of Obama’s economic program is a massive stimulus bill that the Democratic Congress wants to have ready for his signature as soon as he departs the Capitol Hill steps after his inauguration. Even some conservative economists believe a fiscal stimulus is necessary to keep us out of a deflationary spiral, but Obama is only asking a Democratic Congress – given to fiscal incontinence even in rosy economic circumstances – to do what comes naturally.
We can’t know what new twists the crisis will take. We do know that Obama will need more than a ruthless pragmatism to navigate through it. In his masterly “The Great Inflation and Its Aftermath,” Robert Samuelson chronicles the extraordinary stalwartness of President Ronald Reagan when he allowed Federal Reserve Chairman Paul Volcker to squeeze inflation painfully out of the economic system the last time we had a downturn this severe, in 1981-1982.
That took guts. Obama will need them as well, and they won’t be on loan from any adviser, no matter what his pedigree.
Lowry is editor of the National Review.