Obama Economic Shakeup Amid Bad News

With Goolsbee Going, Obama Looks for Reset on Economy

"We don't know yet what happened in terms of this particular blip. What we do know is that gas prices went up and that got consumers worried. All the destabilization in the Middle East has people nervous. What’s happening in Europe has people nervous. So we’ve got some headwinds blowing up against us.”

-- President Obama talking with Cleveland’s WEWS about the economic slowdown in May.

Austan Goolsbee has been as close to an economic guru as Barack Obama has had. The Canadian-born University of Chicago professor was an adviser to Obama in the Senate, an economic point man for the 2008 campaign and, for less than a year, the head of the president’s Council of Economic Advisers.

His sudden departure from the White House comes as close to a staff shakeup as the image-conscious administration ever allows. Usually, people leave the administration like guests at a cocktail party: when they have embarrassed themselves (Desiree Rogers) or they can tell that no one wants to listen to them anymore (Larry Summers) they simply excuse themselves.

For Goolsbee to announce his departure the week after an avalanche of bad economic news suggests that the president is ready to go another way. If it were all about Goolsbee holding on to tenure track at UC, the administration would have no doubt asked that he wait for a more propitious moment to announce his departure, which isn’t set to occur for two months anyway.

The president watched his effort to rebrand the auto bailouts as a success last week get crushed by not only a wave of skeptical reporting about the cost and efficacy of propping up GM and Chrysler for the sake of the United Auto Workers, but also by dire numbers on manufacturing, home prices and unemployment.

When Goolsbee went out to call the dreadful jobs numbers “a bump in the road” he may have sealed his fate.

Goolsbee’s policies have sought a more politically palatable version of the aggressive Keynesian stimuli sought by his predecessor as top economic adviser, Christina Romer, and boosted by liberal doyennes like Paul Krugman. His oft-repeated formulation has been that extraordinary measures were once needed and that the economy would eventually return to vitality.

But with indicators going the wrong way and voters irate over Obama’s handling of the economy (it’s no coincidence Obama trailed Mitt Romney in the usually friendly Washington Post poll), Obama may be losing patience with the idea of encouraging Americans to be glad that we didn’t fall into a depression after the Panic of 2008 and to wait for things to get a little better.

Republicans are pumping up their economic attacks on Obama as it becomes clear that even the administration’s projections of a modest recovery are very much in doubt. Tim Pawlenty today is laying out his plan for a two-tiered, simplified tax system and economic growth. John Boehner is at a Rotary Club back in his Ohio district where he will take the bark off of Obama for sewing uncertainty on taxes and regulation at a time of economic weakness.

Liberals think Obama is doing too little. Conservatives think he is doing too much. Obama and Goolsbee might have thought that was a sign that they had found a balance. It turns out, it just means nobody liked what they were doing.

The world will be watching Federal Reserve Chairman Ben Bernanke’s remarks at a monetary conference in Atlanta. If Bernanke hints that the Fed is considering dumping more cash to boost the economy, it will be taken as a sign that he fears a decline. If he says steady as she goes, it will be taken as a sign that no help is forthcoming, depressing the stimulus lovers on Wall Street.

But since part of the problem with the economy is inflation (a recent congressional GOP report says that more than 50 cents in the recent spike in gasoline prices was due to Fed currency dumping), Bernanke has to be careful about sending any signal that he’s ready to keep the printing pressing humming.

In local interview on Monday, Obama laid the blame for the economy on international events – the revolts in the Middle East and the European debt crisis – but the sudden departure of Goolsbee suggests that we may soon be hearing a different, more vigorous, tune from the president.

Weiner Tests American Capacity for Pity

"I don't believe I did anything that violates any law or my oath to my constituents… Nothing about this should reflect on my official duties [or] my record."

-- Anthony Weiner at a New York Press conference admitting he lied repeatedly, aggressively and systematically about his online sexual exploits.

If your press conference involves the phrase “to the best of my knowledge, they were all adults,” you are probably having a bad day.

If a reporter can be confident he or she can get away with shouting the question, “Were you fully erect?” your next day will not likely be much better.

Having watched Andrew Breitbart’s stumbles with Georgia FDA official Shirley Sherrod, Mad Anthony Weiner may have believed he could loudly lie his way past the fact that a picture of his crotch had been posted on the Internet.

The difference, of course, was that in his case, it was all true.

But as Weiner’s weird behavior reveals, his grasp of reality is not super tight. If a man loves himself so much as to take photo after photo of his body – both nether and upper – and emails them to strange women he met chatting online, it is likely that the man has some serious personal problems. Narcissism. Very low risk aversion. Uncontrollable temper. Power Play will leave it to the professionals to decide what that adds up to, but it’s not a pretty picture (literally).

Breitbart and Weiner had something of a manhood-measuring contest on Monday.

First Breitbart hijacked Weiner’s press conference, demanding an apology for Weiner’s attacks on him during the lying portion of Weiner’s response and saying that he had withheld the most damning evidence of Weiner’s online peccadilloes for the sake of his family – presumably Weiner’s new wife, longtime Hillary Clinton confidante, Huma Abedin.

Then Weiner came out and did what politicians never do: He admitted the whole thing – including an aggressive media campaign of dishonesty waged by his congressional office – and then said he was staying. Even Mark Sanford’s bizzaro admission of Argentine infidelity, while not actually hiking the Appalachian trail at all, hedged on the question of his future in office.

It was so shocking that many establishment press types were just blown away.

These women – young and old, pretty and plain, eager and reluctant – with whom Weiner sought dirty chats and phone sex were dumping carefully preserved details as fast as they could (another sign of Weiner’s emotional problems is that he did not believe that these strangers would betray him). And yet, Weiner took the rap but decided he would stand, er, firm as the congressman from Brooklyn.

It worked… in part. Weiner won descriptions in sympathetic news outlets such as “heart-wrenching,” “sincere” and “emotionally raw.” Not bad for a guy who just admitted systematically deceiving the same outlets for more than a week.

It is possible that he will survive this shoddy scandal. Not intact as the rising Democratic star and chamberlain of the House of Clinton, but in some form. If Gary Condit could stay in office for 20 months after the disappearance of Chandra Levy, surely Weiner can hang on at least until 2012. Only shame could likely drive him out, and that is not a quality with which Weiner has ever been associated. We saw regret on Monday, but certainly not shame.

When he held out that his most recent sending of an unsolicited photo of his tumescent genitals was done as “a joke,” Weiner was clearly still not really ready to face facts.

His fellow Democrats have retreated behind an ethics investigation. By immediately calling for such a probe, Minority leader Nancy Pelosi now has an airtight deflection for questions about the bizarre behavior of one of her top lieutenants.

The investigation may find that Weiner used congressional resources for his virtual trysting – an office phone, a government Blackberry, etc. That could be damning to Weiner’s claim of having kept it all apart from his official duties. It will also be recorded that Weiner used government resources in furtherance of a lie.

By the time the ethics process grinds out a censure or reprimand or whatever punishment short of expulsion that he obtains, these things will all be just hoary details.

The main questions for Weiner’s professional survival are:

Will it be revealed that he lied again? If there are real-world sexual relationships, for example, he's probably toast. Now that’s he’s come clean, there had better not be more details.

What is the whim of the former speaker? Pelosi, likely in consultation with the secretary of State, will make a determination of whether Weiner is a salvage case or must be cut off. She can let him twist for a time and decide later whether she will force him from office or let him live, forever in her debt.

Obama Tries to Charm Merkel into a Greek Bailout

“The world did not wait for another Srebrenica in a place called Benghazi. Instead, we came together in the United Nations, a place where Richard served as our ambassador, to impose sanctions, a no-fly zone, and an arms embargo, and protecting civilians. In a single week, we prevented a potential massacre, stopped an advancing army, and expanded the coalition.”

-- Secretary of State Hillary Clinton in an April 15 speech in Berlin at a memorial ceremony for Richard Holbrooke comparing the Libyan civil war to the genocidal atrocity of the Balkans. Germany opposed the U.N. resolution and NATO participation in the civil war.

Germans believe that Germano-American relations are at a low point. Americans mostly don’t care at what point the relations are.

So on Chancellor Angela Merkel’s official visit (it’s not a state visit because she is not technically the head of state, a ceremonial position reserved for the republic’s mostly irrelevant president), the activities are mostly aimed for continental consumption.

Merkel’s long-running fued with Obama has stretched back to his earliest days in office when she resisted his push for more stimulus instead of austerity. She has resisted him on the Afghan surge by NATO and, most notably, on the involvement of NATO in the stalemated Libyan civil war.

The German press pores over the details of the two leaders relationship and insider press accounts suggest that Merkel took personal offense when Obama changed his course on the Libya war following a huge push by Hillary Clinton for military intervention. Merkel had spoken out in support of Obama’s initial position of non-involvement.

Germany not only opposed NATO action but sat out on the U.N. Security Council resolution calling for what was then humanitarian intervention. When the Libya operation was looking more promising Clinton even used a speech in Berlin to suggest that the Germans were willing to allow a genocide. That’s generally not a cool accusation to make in Germany.

The visit with Obama may help Merkel head off her critics on the left at home who have already forced her to accept the shutdown of the country’s nuclear plants over the next decade. A strong relationship with an adored figure of the European left may help her from having to give more ground.

What Obama need in exchange is for Merkel to get behind a plan for a third bailout of Greek debt in order to stabilize the Euro. Merkel has won acclaim at home for resisting Obama’s calls for cash dumps to help the poor members of the EU cover the losses from unsustainable social welfare programs.

Germany’s economy is the fastest growing on the continent and has a strong long-term outlook, so Germans have mostly been willing to let spendthrift Greeks, Portuguese and Spaniards cry into their olives. Obama, though, wants Merkel to come out in favor of another big loan package to Greece.

The president believes that the EU and its common currency must be preserved at almost any cost in order to prevent global economic uncertainty. He’ll find out whether his media-friendly shows of affection for Merkel can bring her around.

Obama’s Army Takes Shape in Chicago

"As summer organizers, we're the face of the president. So, whether it's here or in our lives, we represent the president 24 hours a day, and that's a really big responsibility we take on."

-- Jenn Brown, a DNC staffer leading the training of 1,600 Obama campaign workers, as quoted by ABC.

The Obama campaign is preparing an army of community organizers to fan out across the nation and raise a new force of Obama volunteers this summer.

The DNC is running a summer boot camp for 1,600 recruits who will use the same principles President Obama used in his work in Chicago to summon a coalition of volunteers and campaign workers to help what is expected to be a $750 million campaign push.

The campaign let ABC in on the training and the network found a “contagious spirit of enthusiasm” at the 50,000-square-foot headquarters in Chicago.

The challenge for the president and his campaign team, though, will be winning with a more disciplined, top-down message than the grass-roots energy that helped take Obama to the Democratic convention and then the White House.

Obama no longer elicits the kind of spontaneous love and joy that he did as a mostly unknown candidate preaching a vague gospel of hope and change. But, his campaign is working to replace that with the most expensive, best organized, most relentless campaign organization in history.

While Republicans are pondering who else might join their field and warming up for an ugly primary fight, the Obamnauts are building a machine they believe can crush whatever the GOP produces.

And Now, A Word From Charles

“It is tempting for Republicans to jump on this, but they shouldn't. The only way to survive if you are a Clinton and the scandal he had is the perception emerges that the opposition, your opposition, is persecuting you, piling on, et cetera. Clinton went through the same stages. He lied and then he did contrition. Then Republicans went ahead with Starr report and the mood, the perception changed, and Clinton ended up in a sense the winner politically.”

-- Charles Krauthammer on “Special Report with Bret Baier.”