By Steven Pearlstein
Washington Post Staff Writer
Wednesday, February 25, 2009
Barack Obama climbed Capitol Hill last night and staked his presidency on bringing the nation out of its economic crisis.
Not since Franklin Roosevelt delivered his first fireside chat, eight days into his presidency, have Americans been more hungry -- and more desperate -- for economic leadership. And not since FDR has there been an economic agenda as bold or ambitious, or as likely to reshape American capitalism.
Just a month in office, Obama has already pushed through additional fiscal stimulus equal to 5 percent of the country's economic output. His Treasury Department is about to embark on the second phase of a program that will lead to greater government control and ownership of some of the nation's biggest banks. He has assembled a team to pull off what amounts to a bankruptcy reorganization for automakers that will leave taxpayers as one of the industry's biggest creditors. And within months, the president has promised to deliver the blueprint of a new regulatory architecture that will dramatically increase the government's oversight of financial firms.
If all of that weren't enough of a challenge, Obama vowed to move quickly to revamp the health-care system, put the government on a credible path toward a balanced budget, dramatically reduce the country's carbon footprint, rewrite the tax code and reform public schools.
"Action, and action now," is how FDR put it in his time. In Obama's translation, "that day of reckoning has arrived, and the time to take charge of our future is here."
It remains an open question whether by trying to do so much so fast, Obama will be able to create the momentum and sense of urgency necessary to overcome pushback from many Republicans, the inevitable opposition from special interests and the natural tendency of the system to return to the old political equilibrium.
Already there are signs that the demands of the president's ambitious agenda have overwhelmed the economic team that has been assembled at the White House, the Treasury and other federal agencies. And there are some who warn that in asking Congress to consider so many different issues, Obama runs the risk of political gridlock as one initiative is held hostage to another.
But as Obama sees it, his strategy is not to find a way to maneuver a wildly ambitious economic program through the twists and turns of a hostile and byzantine political system, but to use the urgency of the moment and his considerable political capital to reform that system and transform the way politics is done.
Certainly in his speech last night, Obama has reinforced the image of a serious and purposeful leader who aims to rise above partisan sniping and neutralize much of the cynicism that has infected American politics. His critique of the failures of the past were powerful and unassailable. And while his program is certainly open to criticism, he made clear that he would rather engage critics than simply defeat them. He attempted to be the grown-up in the room, willing to accept responsibility and prodding others to do the same.
While the economic challenge facing Obama resembles the one faced by FDR, there is one important difference. By the time Roosevelt became president in March 1933, the stock market had long since collapsed and the economy was already well into depression. He had nowhere to go but up.
Obama, by contrast, arrived in Washington just as the effects of the financial crisis had begun to hit Main Street and the economy was beginning its precipitous decline. Whatever he might do to slow or moderate the downturn, things will inevitably get worse before they get better.
For that reason, his speech was carefully crafted to prepare the country for a deep and nasty recession while reassuring us that we'll pull through it if we pull together behind his program.
It was hardly the only balancing act that the president needed to pull off.
He sought to give voice to the incredible anger that Americans feel toward Wall Street while reminding them of their own culpability and convincing them that the only way to avoid economic calamity may be to commit even more government money to rescue some of Wall Street's biggest players.
He acknowledged the failure of government to balance its accounts, regulate financial markets and spend money wisely, even as he called on Americans to reaffirm their faith in government and expand its scope and powers.
He aimed to satisfy the demands of investors and consumers and business executives for greater clarity and certainty in government policies, even as he was forced to acknowledge that many of the details are still to be worked out.
Last night, Obama tried to walk each of these fine lines, delivering his message with the same sense of confidence in himself, in his ideas and in his country that won him the presidency in the first place.