"Pop" Goes the Obama Balloon

Mon, 02 Feb 2009 16:24:52 +0000 – By Liz PeekFinancial Columnist

I'm worried about our new president. He's been on the job only 14 days and he's already petulant. How in the world will he survive the next four years?

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Blasting away at Rush Limbaugh and Wall Street executives seems so out of character for our Charmer-in-Chief. What happened to the fellow who kept his cool throughout a grueling campaign, who promised to unite us, who urged us to "put aside childish things?" What's next -- a "na nana boo-boo" moment?

Nancy Pelosi

But then came the stimulus bill. At first, I found excuses for the new president. He's been busy, I told myself. He hasn't had a chance to examine the 647-page collection of pet projects assembled by his Congressional colleagues.

I assumed that once Obama was made aware of the bill's absurdities and shortcomings, he would work with members of both parties to make it better. Indeed, he did weigh in on certain especially nonsensical items, such as $200 million for birth control, which were subsequently eliminated.

But, he hasn't challenged the core elements of the bill, which shamelessly promote labor's agenda and which set us further along the road to nationally-managed health care. Nor has he objected to the protectionist "buy America" language designed to curry favor with unions. Combined with the confrontational tone that Clinton and Geithner have taken towards China, the provisions suggest that the White House may well channel the disastrous Hoover administration. (Have they actually looked at who's buying all those nice new Treasury securities and thought about how a revaluation of the renminbi would affect those holdings?)

As important, he didn't register any of the disappointment that the rest of the country felt with the shortcomings of the bill. Where are the exciting new technologies and plans for the future? Instead, Obama is angry at the Republicans for not supporting the bill. What is he thinking?

Meanwhile, as we still listen for sleigh bells, there are other dissonant notes. There has been, for instance, the enormous build-up in Obama's White House bureaucracy. (Maybe this is his secret plan to fight rising unemployment). He has in a matter of days established a new White House office for the middle class, a new White House office on health care, a new White House office to develop urban policy and another to monitor technology. There's also a new White House office on climate change and energy and pretty soon he'll be adding a car czar to the list. Imagine how many staffers will be hired to flesh out these new departments. That is what he meant by infrastructure spending! Now I get it.

Meanwhile, he cheerfully clobbered the auto industry by allowing states to enact their own emissions standards, essentially forfeiting reasonable federal oversight on this process. It is hard to imagine a worse time to create new obstacles for Detroit's wounded auto makers.

To restore his popularity, Obama has climbed onto the bandwagon of all those folks who are hectoring Wall Street executives. This is not only unproductive (we still have to protect the banking system as distasteful as that may be) but it is distracting us from the important business of the day. The focus on John Thain's wastebasket has diverted the nation from considering important policy initiatives hidden in the stimulus bill. Maybe this is by design. It is certainly easier to arouse the nation's ire about "shameful" self-indulgence than to try to explain the "Comparative Effectiveness Research" outfit financed in the bill.

Obama needs to make this a better bill that both parties can support. He says he wants transparency -- why not break up this ungainly package into separate pieces that can be argued and adopted, and that won't provide cover for Democratic agenda items? Let's make it simple, and let's move. The whole world is watching, and we are still listening for that "Ho-Ho-Ho."