Why David Sirota is Wrong…

I saw this article, and because it was written by David Sirota, I read it. But this isn't exactly vintage Sirota, and its premise is not only weak, but demonstrably false. This is surprising, since I am usually a big fan of David's, and usually find his reasoning to be sound.

I am not just offering the opinion that he's wrong. I'll demonstrate exactly what I mean…

From Salon.com | Obama's team of zombies, by David Sirota.

Only weeks ago, the political world was buzzing about a "team of rivals." America was told that finally, after years of yes men running the government, we were getting a president who would follow Abraham Lincoln’s lead, fill his administration with varying viewpoints, and glean empirically sound policy from the clash of ideas. Little did we know that "team of rivals" was what George Orwell calls "newspeak": an empty slogan "claiming that black is white, in contradiction of the plain facts."
Obama's national security team, for instance, includes not a single Iraq war opponent. The president has not only retained George W. Bush's defense secretary, Robert Gates, but also 150 other Bush Pentagon appointees. The only "rivalry" is between those who back increasing the already bloated defense budget by an absurd amount and those who aim to boost it by a ludicrous amount.
Okay, here's the first mistake. First of all, we have no way of knowing which of Bush's people were actually pro-war or anti-war, since no one in his right wind who is working for a president will publicly speak out against him. It's also quite possible that they might refuse to quit, because while they can't stop the occupation, they might be able to mitigate its effects somehow. Not only that, but the only person whose opinion matters was Bush's, and is now Obama's.

Does Sirota understand what caused the Democrats to lose everything in 1994? It was the Clinton Administration's decision to replace every ReaganBush official with a green Democratic official. who saw his same "vision." In short, Clinton didn't appoint anyone who knew his ass from a hole in the ground, and it showed, as his administration sputtered for the first two years, despite having a majority in Congress. It doesn't help to have a vision, but hire a bunch of people who don't know how to implement it.

Iraq is a cesspool; anyone would agree with that. And we need to get out of there relatively quickly. Now, I'd ask David Sirota to answer this question; who is more likely to understand the terrain of our involvement in Iraq; a Bushie or a brand new shiny bureaucrat, who would have to spend a year being briefed in order to even figure out what the hell we're doing there? The answer is, the Bushies know what's going on, and can actually get us out more quickly. If these people are such Bush loyalists that they refuse to follow the orders of the current president, they will either quit,or open themselves up to being fired relatively quickly. But the bottom line is, Barack Obama is president of the United States right now, and HE makes the decisions.

In other words, Sirota's premise is flawed, because his assumption is that everyone who ever worked in the Bush White House was a "Bush Loyalist," and was therefore in favor of the Iraq occupation., and will continue to work toward that, despite what President Obama wants. That would be like saying that everyone who worked for Bill Clinton thought Hillary's approach to health care was the only one to pursue, which is, of course, absurd. It precludes the possibility that there might have been (admittedly suppressed) dissenting voices within the Bush Administration, which actually belies the common sense with which Sirota usually approaches such subjects. I'm not saying he's wrong, but the odds are against it. And even if he's right, the people serving in the Obama Administration will have no choices other than to do what he tells them,or quit. And President Obama has reiterated his intention to pull us out of Iraq as quickly and cleanly as possible. Until he demnonstrates an inability or unwillingness to do so, we have to take him at his word.

For example, Secretary of Defense Gates has
suddenly become one of the fiercest Obama loyalists ever, and has
sounded very much like he wants this thing over. His stance on Afghanistan is troubling, but I have a feeling we'll be out of there sooner, rather than later.

Sirota continues:

Of course, that lockstep uniformity pales in comparison to the White House's economic team — a squad of corporate lackeys disguised as public servants.

At the top is Lawrence Summers, the director of Obama's National Economic Council. As Bill Clinton's treasury secretary in the late 1990s, Summers worked with his deputy, Tim Geithner (now Obama's treasury secretary), and Clinton aide Rahm Emanuel (now Obama's chief of staff) to champion job-killing trade deals and deregulation that Obama Commerce Secretary Judd Gregg helped shepherd through Congress as a Republican senator. Now, this pinstriped band of brothers is proposing a "cash for trash" scheme that would force the public to guarantee the financial industry's bad loans. It's another ploy "to hand taxpayer dollars to the banks through a variety of complex mechanisms," says economist Dean Baker — and noticeably absent is anything even resembling a "rival" voice inside the White House.

Okay, this one is partly correct. In a perfect world, I'd like Ben & Jerry to be Secretaries of Treasury and Commerce. and I'd like to see actual progressives in the main show.

But the fact is, just as is the case with the "wars," the only way we can solve the economic crisis is by installing people who will know immediately what to do., under  Obama's orders. And those who caused the problems in the first place, strangely enough, are the ones most capable of fixing it. Once more, the head of the government, who is Barack Obama and not Bill Clinton, is the key here. Obama is not the purely political animal, as Clinton was, or at least, he's a more traditional political animal, who will actually work with trial and error, and find solutions that work for everyone. And I don't mean everyone's political side; I mean every element within the economy.

I would also disagree with Sirota that ANY economist is who we should consult when it comes to the current economy. But I would submit that it will take a mechanism whereby the government guarantees the bad loans to some degree in order to restore the credit market, and get the economy moving again. In my humble opinion, the only true solution to this mess is to force banks to rewrite mortgages that are currently upside down. They should rewrite them at the current value, and a discounted interest rate, so as to stem the tide of foreclosures, and restore value to the mortgage backed securities market. And then they should liquidate the old MBS for pennies on the dollar, and restore that market to the quasi-governmental agencies, Fannie and Freddie, that were able to manage that market for many years without a problem. They also need to re-regulate the securities markets, and limit speculation, of course.

But the bottom line is, how does anyone do any of that that without "handing taxpayer money to banks"? The answer is, it's not possible.

That's not an oversight. From former federal officials like Robert Reich and Brooksley Born, to Nobel Prize-winning economists like Joseph Stiglitz and Paul Krugman, to business leaders like Leo Hindery, there's no shortage of qualified experts who have challenged market fundamentalism. But they have been barred from an administration focused on ideological purity.

n Hindery's case, the blacklisting was explicit. Despite this venture capitalist establishing a well-respected think tank and serving as a top economic advisor to Obama's campaign, the Politico reports that "Obama's aides appear never to have taken his bid (for an administration post) seriously." Why? Because he "set himself up in opposition" to Wall Street's agenda.

The anecdote highlights how, regardless of election hoopla, Washington is the same one-party town it always has been — controlled not by Democrats or Republicans, but by Kleptocrats (i.e., thieves). Their ties to money make them the undead zombies in the slash-and-burn horror flick that is American politics: No matter how many times their discredited theologies are stabbed, torched and shot down by verifiable failure, their careers cannot be killed. Somehow, these political immortals are allowed to mindlessly lunge forward, never answering to rivals — even if that rival is the president himself.

Again, I don't completely disagree with the above. But again; if you bring in a shitload of people who are not familiar with the mechanisms of the markets and how they work currently, how much of a learning curve will you have to deal with? And how much of a learning curve do we have time to deal with at the moment, with the economy in free fall?

I would point out that Robert Reich was very much involved with the Obama campaign, and was a close advisor to the president-elect during the transition. It's no secret as to why Brooksley Born would not be working in this Administration, since one of her arch nemeses in her attempts to being derivatives under the purview of the CFTC during the Clinton Administration was none other than Lawrence Summers. Again; President Obama is already demonstrating a completely different leadership style than Clinton While you want a team of rivals, you don't necessarily need a team of opponents. I would also point out that, once the initial push to straighten out the economy is accomplished, there will be plenty of time to bring in progressive voices, and move the economy in a positive direction. I don't know about David Sirota, but I would much rather let the people who helped make the mess clean up their own mess.

All of that said, it does worry me a bit that there isn't more of a plan on the table for fixing the economy, and I wish Obama would bring someone like Stiglitz and Krugman in to advise on the proper framework for a plan. I'm willing to excuse Obama a bit for the time being, because this recession has been metastacizing so fast that it's been difficult to know what can be done on the short term. A plan to save mortgages is necessary, but it can't be the entirety of any plan. But now that the Obama Administration is in charge, it will be important to put together a comprehensive plan going forward, and not just a rescue plan.

Remember, while Obama said he wants to slash "billions of dollars in wasteful spending" at the Pentagon, his national security team is demanding a $40 billion increase in defense spending (evidently, the "ludicrous" faction got its way). Obama also said he wants to crack down on the financial industry, strengthen laws encouraging the government to purchase American goods, and transform trade policy. Yet, his economic team is not just promising to support more bank bailouts, but also to weaken "Buy America" statutes and make sure new legislation "doesn't signal a change in our overall stance on trade," according to the president’s spokesman.

Indeed, if an authentic “rivalry” was going to erupt, it would have been between Obama's promises and his team of zombies. Unfortunately, the latter seems to have won before the competition even started.

The above is catty, and does not contain the usual good sense that David Sirota usually brings to his work. If he's trying to "prove" that he's "objective," so he's taking swipes at Obama, he should really stop, because the above is borderline sophomoric, almost worthy of Fox News.

Let me start with the fact that Obama's been on the job for a little over two weeks. He hasn't had time to fully evaluate the level of waste in the Pentagon, in order to address it. But I would also note that Bush has NEVER included an appropriation for Iraq and Afghanistan in one of his budgets — he has always asked for an emergency appropriation. It is unlikely that there is currently an appropriation in the current Defense budget for either occupation. Therefore, asking for $40 billion to facilitate the pullout of troops in Iraq, and whatever he ends up doing in Afghanistan, is a small price to pay, considering the amount Bush used to toss in the crapper.

It's simply not possible to evaluate the entire Defense Department in two weeks, and the current budget has already been appropriated; the Republicans made sure they appropriated all of the Defense money  before they left, as has always been their tendency, so it's not possible to put the genie back in the bottle for the current fiscal year. David should know this.

As for his "economic team," the fact of the matter is, bank bailouts will be necessary, so you'd better get used to them. The only question is, how will they be administered. As we've seen, Obama's already been more than keen on putting conditions on the money; the problem is, Congress has to okay many of the conditions, as well, and there are enough Republicans and Democrats from Republican states/districts that he can't just do whatever the hell he wants; he still has to work within that framework. Once the stimulus works, and he's demonstrated his gemius with the economy, he'll have more political capital. But for right now, he's constrained by reality.

I would also point out that the "Buy American" provisions that were initially proposed in the stimulus plan were not only opposed by Republicans; some labor interests were also concerned.. The Congressman representing Flint, Michigan was particularly vocal against it. The House version contained protectionist language regarding steel, and the Senate version originally included a much broader category that would have affected all manufacturing. The language was already raising hackles in Canada, the EU and China, and I would point out that, if we're to expand our manufaturing base, which should be the goal of any economic stimulus, pissing off the three largest potential markets for our goods, including solar panels and wind turbines, is not an intelligent trade strategy. Yes, I agree that China regularly violates trade rules, but can we afford to make them want to slap tariffs on anything we make and wish to sell over there? In other words, the issue is far more complicated than simply "Buy American."

Once more, I was disappointed with this article, because it developed from a false premise and devolved into a catty exercise more appropriate for Fox News than the legitimate source for news that David Sirota usually represents. Let's all see how things turn out before we critique Obama so harshly. He's already demonstrating himself to be better than Clinton was in his first few months, and I can't help but think that's because he has experienced people in there, who know what they're doing. Let's find out if he's doing things the right way before we start writing him off.

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