Sunday, November 09, 2008

Why is Obama so hands-off on the current Treasury bank bailout effort?

A lot of people, especially Democrats, are not very happy with the current state of the Treasury bank bailout effort, but oddly Barack Obama has "held his fire" in either vigorously endorsing or criticizing the Treasury program. Why would he do that? Reasons I can think of include:

  • He actually isn't a hard-core Progressive and in fact has definite Centrist leanings, so he does not want to tar himself as being merely yet another partisan sniper.
  • He actually wants to defer to the congressional Democrats as a gesture of good will in return for the support that they gave him in the election.
  • This is a deliberate effort on his part to attempt to pre-configure the relationship between the White House and Congress, where the White House sets big goals and then Congress tinkers with the details to meet those goals, so that there can be a shared sense of achievement, rather than having a lot of big congressional egos feeling that they are simply being used as rubber stamps. This appraoch could enable him to tackle much bigger efforts than if he were to focus only on efforts that the White House alone could "push" through Congress.
  • This is a deliberate effort to establish a bipartisan "tone" and to refrain from needlessly bashing "the other side" simply to run up some partisan political points.
  • He does in fact actually recognize the complexity and scope of the problem and simply wants to establish his "tone" as deliberate and thoughtful rather than another knee-jerk response. In his first news conference he used the phrase "deliberate haste" and explicitly emphasized his intention to be "deliberate."
  • He does in fact recognize that the best course is to let the current bailout run its course to the point where it is either clearly working or clearly broken before jumping into the fray.
  • He wants to wait until he announces his pick for Treasury and then delegate full responsibility for handling the financial crisis to him or her.
  • Maybe he is still considering the possibility of keeping Paulson on for an interim period to get the bailout fully operational, but simultaneously wants to keep his distance to preserve "deniability" if the bailout fails in any way.
  • Maybe it is all simply too much for a fledgling administration to digest so early in the game.
  • Maybe he does actually believe that the current bailout and bailout team is about as good as it is going to get, but does not want to admit that since it would deeply offend a lot of Democrats
  • Maybe he sincerely wants to establish a "tone" of extreme hands-off where he focuses on the big picture "vision stuff" and subordinates are charged with rolling up their sleeves and doing any detail work or even criticism.
  • Ultimately, this stuff really is really hard and there are no simple answers, so off-the-cuff critiques are particularly useless. Lesser politicians would babble anyway.

In short, I suspect that Barack is being so hands-off because he intends to be extremely hands-off. Yes, he will be the ultimate decisionmaker, but he recognizes that distributing responsibility and sense of participation and ultimately sense of achievement is critical for managing a problem of this complexity.

In other words, at this stage of the game I am willing to be quite generous. Seriously, I do think he has some serious "juice" up his sleeve and that he will in fact provide excellent leadership, but that is mostly a suspicion on my part rather than a belief that is backed up by hard facts.

There is an open question of whether true leadership means that the leader must hold the hands of the "babies" every single step of the way, or whether the true leader can succeed and thrive by keeping a slight distance from the "babies" who are afraid that the sky will fall if there is not a daily press conference that explains everything in extremely fine detail. For the record, I agree with Phil Gramm that we are in fact a "nation of whiners" and that the recession is far worse in our heads (and in the media) than it is in reality.

-- Jack Krupansky


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