Fear And Anger Stalks The Land; Will President Obama Learn to Manage It Or Become Its Victim? (Joe Rothstein's Commentary)

November 24, 2009

By Joe Rothstein
Editor, EINNEWS.com

President Obama rode a wave of hope and trust to win a decisive victory last November. But by the time he was sworn in, economic circumstances were already altering the national mood from one of hope to one of fear and anger.

Fear of losing a job. Fear about that mortgage or sinking home value. Fear that the country was spending itself into bankruptcy. Anger at the bailouts. Anger at the bonuses. Anger at the self-dealing big shots who brought on the near-depression. All that and more served as prey for those who see fear and anger as an attractive political flame worth stoking hotter.

Neither fear nor anger was part of President Obama's 2008 campaign agenda, and it doesn't seem to be in his DNA. After a year in office the President is still struggling to catch up. He's a rational and thoughtful man and it's apparently not easy for him to understand or manage the politics and economics of raw emotion.

But that raw emotion has changed what should have been a slam dunk of an effort to improve the U.S. health care system into a down-to-the-wire, one-last-vote-or-lose cliff-hanger. It's forced the Senate to delay until next year any action on a vital energy reform plan. And now, it appears, the bubbling anger over bailouts and bonuses will explode into changes in banking laws that the Obama administration has neither proposed nor supports.

In what seems to be a grassroots congressional uprising, after the Thanksgiving holiday the House may pass legislation that all but directs the break up of Citigroup, Bank of America, Wells Fargo and JPMorgan Chase---and other banks in the too-big-to-fail category. A key House committee already has approved this plan.

On a separate track, House members, apparently independent of the House Democratic leadership, are going to force a vote on a bill that would tax stock, bond and other financial transactions to 1) create jobs and 2) reduce the budget deficit. Just so no one misses the purpose of the bill, its sponsors have titled it the "Let Wall Street Pay for the Restoration of Main Street Act of 2009."

Flying just under the radar is what may be the most important independent commission created by Congress since the 9/11 Commission. This one is called the "Financial Crisis Inquiry Commission." Its members have been meeting privately with top administration officials and financial leaders and plan to begin public hearings in January. Their mission is to figure out what brought on the financial crisis.

We will soon see a parade of financial heavyweights testifying under oath, in front of TV cameras and possibly under subpoena about how Wall Street nearly brought down the entire world capitalist system. It won't be pretty. If this had happened a few hundred years ago no doubt there would have been guillotines waiting outside the hearing room. Expect heads to (figuratively) roll.

The President is a smart guy. By now he should be well aware that before he can get back to trust and hope he needs to somehow manage the fear and anger that stalks the land. It can go either way for him. His administration is stacked with those who are way too close to Wall Street, and too tightly tied to the very financial institutions the public currently hates. The White House has pulled far too many punches in designing its own reform proposals to satisfy the magnitude of the crimes, the need for future public protection, or the lust for retribution.

President Obama is a graduate of the Chicago school of politics, known most of all for its pragmatism rather than for its adherence to ideology. The most significant Illinois politicians of the past 50-60 years----the Daleys, Everett Dirksen, Paul Douglas, Paul Simon, Charles Percy---Democrats, Republicans, liberals, conservatives, all have practiced the politics of the possible. They've all been deal makers. Take one step in the direction you want to go now and that gets you closer to the three others you might be able to take later.

We see Obama the deal-maker all over the health reform effort---in the ways he's muted opposition from the drug industry, from the medical groups, from much of the business community, and, even to some degree from the private insurance industry itself. We saw it in Obama's willingness to accede to Republican demands to add an expensive but virtually meaningless tax credit to the original stimulus bill. We see it in the maddeningly relentless efforts to sweet talk "bi-partisan" legislation out of Republicans who have zilch interest in anything other than making the Democrats seem like incompetent bozos by November 2010.

And we've seen it in the way Geithner at Treasury, Summers in the White House and others on their teams have walked a fine line between proposing needed reforms while not wrecking their relationships with the Masters of the Universe.

But if the President is to avoid becoming one of "them" in this "them" or "us" environment he needs to break loose of his cerebral moorings----and maybe he has to cut loose Geithner, and others, too. The U.S. House----his Democrats---are on the verge of stampeding through some tough, tough anti-banking, anti-Wall Street legislation. On the Senate side, Banking Committee Chairman Chris Dodd is also off the White House reservation with a proposal much like the one in the House.

Will Obama jump in front of that movement, acquiesce to it, or fight it? When the Financial Crisis Commission goes public, some of the very people Obama has making policy will look very much like they are part of the problem. Will he dump them before, after, or never?

Let's hope and trust that the President, rational man that he is, will have the audacity to exercise passionate leadership that channels all that fear and anger for worthy, not destructive purpose.

The remainder of a very full Obama agenda for 2010 hangs in the balance, as does the possibility that the 2010 elections will produce an even less hospitable majority for him in Congress.

(Joe Rothstein can be contacted at joe@einnews.com)