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After 13 Years In The White House, Economic Adviser Gene Sperling Learns To Unplug

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GENE SPERLING OBAMA
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WASHINGTON -- Gene Sperling may no longer be at the White House, but he still gives the impression of a man moving at a frantic pace.

President Barack Obama's former top economic adviser, who spent a huge swath of his career in public service, was supposed to finally rest once he left the West Wing for the West Coast. But time remains a precious commodity. Cabinet meetings have been replaced with ballet lessons (his daughter's, not his). Conference calls have been traded for household chores. And even though he's no longer in the thick of legislative battles -– from banking reform to housing policy –- the phone calls haven't stopped. The man needs a job, after all. Networking still matters.

While the pace may not have slowed as much as expected, the mind has begun to show the faintest signs of mellowing. When he finally found the time to chat -- after a few email exchanges and some abruptly curtailed phone calls -- Sperling was a touch serene and reflective. After 20 straight years of work on economic policy, he was ready to go.

"I think what probably helped was simply the fact that I just went so hard the last nine months," he said. "That had the positive effect of getting a lot done that I cared about. But perhaps it exhausted me enough that the joys of overcoming exhaustion have perhaps outweighed any withdrawal from checking your Blackberry."

It is a weird sensation to suddenly no longer be at the epicenter of action. The feeling of being wired into the country's most consequential decisions can be like a narcotic. Eight years in the Clinton administration, followed by time in the private sector (hello, Goldman Sachs), followed by five more years in the Obama White House, made stress seem like a normal part of everyday life. As Sperling put it: "To succeed as a senior White House job, your antenna has to be constantly up."

And now, suddenly, the antenna has to be put down. It "has been a bit heavenly," Sperling said. It also has allowed him to reflect and reminisce about the administration he left earlier this month.

In our conversation, he recounted how, in the summer of 2011, he became gradually convinced (or, perhaps, petrified) that House Republicans would force the country to default on its debt.

"To actually be in the Oval Office walking through what might happen in the first days or weeks of the default," he said, "was a gut-wrenching experience that I'm glad we never had to live through."

Sperling defended the regulatory reforms the administration applied to the financial system. But he conceded he has anxiety that lawmakers will forget the horrors of the 2008 economic collapse.

"You can see in the reaction of some to housing reform, how these problems can linger," he said. "Here we are five, six years after a housing-related financial crisis brought down our economy and you already have some people saying, 'Well Fannie and Freddie are doing okay now. Maybe we don't have to fix things. We can wait until later.'... I find that really problematic."

There are few regrets that Sperling brought with him when he left the White House. The one he feels "worst about" is the shift toward deficit reduction in 2010 and 2011, which, he said, hurt the country's "historic mission" to fund education, science and other domestic priorities. Looking back, he takes umbrage at the criticism -- oft repeated by Republicans and occasionally by Democrats -- that the president shouldn't have pushed health care reform in 2009 when the stagnant economy was in need of nurturing.

"The question you have to ask yourself is why do all of us engage in the public policy and political process? When people said perhaps the president shouldn't focus on historic health care reform because it might hurt, it might make the midterm elections more difficult, that is a complete substitution of political process over the end goals of policy," he said. "The whole point of all the work that people did to help elect President Obama was to put him in this rare moment to do what Clinton, Truman, Roosevelt, and LBJ had all failed to do."

The regret was not in the pursuit of the health care law, Sperling conceded, but in the implementation.

"We all failed [the president]," he said of the healthcare.gov launch.

A sanguine person by nature, Sperling didn't rosy his assessment about the state of the political system he left. Governance in the age of Obama, he argued, was tougher than during the height of Bill Clinton's impeachment hearings. Even the completion of a budget agreement with Congress before he left doesn't alleviate his skepticism.

But for all that, Sperling said his exit from the White House is merely a hiatus -- not a break -- from public service.

"I will always feel that public service is my life's work and the way that I gain the most spiritual and personal satisfaction," he said. "At the age of 55 and almost 30 years of full time public service, I consider the next two, three years to be a break from that path not a change with what I overall plan to do with the rest of my life."

Below is the transcript of our conversation, edited slightly for brevity and clarity.

Talk about the difficulties but also the nice aspects of flipping off that switch and returning to civilian life.

It's the ultimate mixed feelings. On one hand, having a senior economics role for a president I believe in is in many ways my life's work. ... In that sense, from a professional point of view, it seems unreal to be leaving that. On the other hand, as a dad and a husband and someone who just has to acknowledge the degree of exhaustion, being able to do the little things like take your daughter to and from school, and having dinner with your family without enormous anxiety about what has to get done quickly, has been a bit heavenly.

Do you feel healthier? Do you feel more grounded, even just days in?

I think, I think to succeed as a senior White House job your antenna has to be constantly up. And so even when you are sprinting off to see your daughter's ballet performance, or chasing time off to help your son with his history exam, you are constantly aware of the multiple things you have to get done under extreme time pressure, with high consequences for failure. So it's not just having the time, it’s the opportunity to be 100 percent present with your family, as opposed to as opposed to thinking about how much less sleep you're going to get that night because you decided to be a good dad between 7:30 and 10 o’clock.

Do you still have the instinct to pick up your Blackberry and check it for emails that you assume are coming?

Less than I thought I would. I think the hardest for me has been housing finance reform, simply because after 10 months of playing a key role in that effort, it was odd to literally be leaving the day things were coming together. But even there, it's more feeling a sense of responsibility to still be helpful from the outside than a sense of compulsion or addiction to Blackberry.

I think what probably helped was simply the fact I just went so hard the last nine months. That had the positive effect of getting a lot done that I cared about. But perhaps it exhausted me enough that the joys of overcoming exhaustion have perhaps outweighed any withdrawal from checking your Blackberry.

Putting aside the financial crisis, what was the next hardest thing that you were put through?

There's no question that, after the financial crisis, the most tense and all-consuming times were when we were on the brink of the country's first potential default or going over the cliff. I think while the entire town likes to offer their views on the cost and benefits of each move, when you're in a senior role surrounding the president, you more than anyone have to recognize how enormous the consequences of things going wrong are for the global economy, for tens of millions of people, for long-term damage. That's a heavy load, but it's one that you have to embrace if you want to be in these jobs.

Was there ever a point during the standoff that you were more or less convinced that we were going to default?

You know, one of the things we have never discussed publicly is what the contingency plans would've been. They were gut-wrenching and to actually be in the Oval Office walking through what might happen in the first days or weeks of the default -- to be in the Oval Office, actually talking about both the mechanics and the impact of what could likely happen in the first days and weeks was a gut-wrenching experience that I'm glad we never had to live through.

Sure, but was there a moment where you thought you would have to live through that gut-wrenching experience?

It certainly seemed real enough on more than one occasion ...

One of the most consequential days being in the Oval Office was before one of the meetings we did in the Cabinet Room where we would have our team, the president and the vice president and the leadership of both the House and Senate. And the president kind of looked at Tim [Geithner], and Jack [Lew], and Rob [Nabors] and myself and others in there, and he said to us that he's never going to go through this again. That he feels that doing so actually compromises the office of the presidency and our constitutional system, and that he wanted everyone to know that, to understand that. And I remember he looked at us and said, 'I want you to know, I'm not going to change my mind, but I want that to show up, not only in everything you say, but even in your body language.' And he never wavered after that.

You mentioned at a recent Christian Science Monitor breakfast that the financial crisis in 2009, when you guys took office, was like a West Wing episode.

The president said to me -- it was a day and we were in the Oval and it had just been a crazy day and now it was 9 at night. He was going to call local officials about his Chrysler decision. These are all difficult calls. And he looks at me and says, 'Is it always like this?'

And that’s when I said, 'Mr. President, when I was a consultant for 'The West Wing,' people always ask if it was realistic. And I would say yes. It’s just that they condensed what usually takes nine months into one hour.' And I said that is how your first three months feel.

It strikes me that on the auto bailout, it was very clear that there were arguments for both sides. Was it coin flip?

I thought that was one of the high points both process-wise and policy-wise. There was just enormous amount of rigor and sound debate. Larry [Summers] really was an excellent, honest broker during it. It is true, the numbers were evenly decided. There were about eight people who were deeply involved and it was split about four to four and the president went into the Roosevelt Room that day and he went down and he let every person speak.

It was serious. It was respectful. It was passionate. And he heard the policy arguments. He heard the unattractive public views on the issue. And he made one of his best calls. I was proud to be one of the four. It was definitely Brian Deese [a top adviser] and Ron Bloom [of the White House Auto Task Force] and I who presented the pro side. But you had such respect for all of the arguments, the people who were arguing the other way. They were not being heartless. They were arguing that the remaining companies would pick up market share and employees. I thought it was a great presidential moment of somebody really encouraging open respectful debate.

On the financial system, obviously we're in a much better place than when the president took office. But I'm wondering as you look at the system right now, if you have worries that we will forget the lessons of 2007 and 2008?

I feel very positive about the steps the president took to help save our country from a long-lasting downturn or even a second depression. And I feel positive that we've moved the ball forward in the right direction through Dodd-Frank, through the creation of the [Consumer Financial Protection Bureau], and the measures to prevent too big to fail. But I do think one has to remain vigilant.

There's certainly steps -- like how the rating agencies stamp AAA on so much junk -- that has never been fully addressed. You do worry. You can see in the reaction of some to housing reform, how these problems can linger. Here we are, five, six years after a housing-related financial crisis brought down our economy and you already have some people saying 'Well Fannie and Freddie are doing okay now. Maybe we don't have to fix things. We can wait until later.' From a good-government point of view, I find that really problematic. Part of the lesson has to be to fix the roof. You know, fix the leaky roof that could cave in when it's sunny outside and you still have time.

On the whole, were there more steps that should have been taken?

I think that one of the misfortunes of economic policy over the last 15 years is that when we started to experience in the 2000s the degree that technology and globalization could lead to a hollowing out as opposed to strengthening the middle class, you first had a presidency that seemed almost uninterested in acknowledging or addressing the issue. And then you had a president like Obama who thought this was the essential challenge of our time and he was forced by necessity to spend every ounce of time and energy saving the economy as opposed to spending 100 percent of his time on the central challenge, the central economic challenge of our time. I feel the Affordable Care Act is in many ways his, one of his efforts to not let the crisis overtake too many of his initial policy objectives.

That's interesting because the common counterpoint to that is that the president should have never done health care in 2009 and 2010 -- he should have kept focusing on building the economy.

I disagree strenuously with that critique for a couple of reasons. One, we were trying to do everything possible. Whether we were doing health care or not, we were facing a degree of congressional and public fatigue from the enormity of the financial crisis and recovery efforts that made many additional efforts political non-starters. The idea that that was because of health care just doesn't bear out when one looks at what was happening in 2010. Secondly, I believe that health care reform was one of the most consequential economic measures the president could take in terms of providing more economic security to working families ... Lowering health care costs is one of the most specific things one could do to try to increase wages. So I not only disagree with that critique, I'm at the polar opposite.

The question you have to ask yourself is why do all of us engage in the public policy and political process? When people said perhaps the president shouldn't focus on historic health care reform because it might hurt, it might make the midterm elections more difficult, that is a complete substitution of political process over the end goals of policy. The whole point of all the work that people did to help elect President Obama was to put him in this rare moment to do what Clinton, Truman, Roosevelt, and LBJ had all failed to do.

What was it like then, when the moment came to launch the exchanges and the technology was a bust?

There's no question that that was a painful moment, one of the most painful moments, because the president had repeatedly said for two years that what mattered most to him is real people getting on the Internet site and being able to purchase health care in an easy way. ... So it is my view that we all failed him. I’m very much against efforts by anyone to try to scapegoat specific or lower-level people. This was a failure by all of us who were in senior positions. And all we can do is all you can do is all you can ever do in life, which is move forward as best as you possible can.

Let me just do a few rapid-fire ones because I know you're a busy guy and you deserve to spend time with your family. What's the thing that surprised you most working in this White House compared to the Clinton White House?

It wasn't that the White Houses were different. It was just that my life was so different. In Clinton I was single with no conflicts. I was one of the insiders coming right from a senior position on the campaign to the West Wing. And this time I was a person whose life was consumed by racing home to my kids and not having the physical capacity to only sleep three to four hours a night.

Let me ask you a different way. Did you find it harder to be part of a team that's trying to govern during the Clinton era or during the Obama era?

Despite the recent state of Republican nostalgia that they loved Bill Clinton, it was always rough and tumble from the shutdown to impeachment. The thing that was easier in the ‘90s was that when there was a sense of mutual self-interest in getting something done, our adversaries could work with us to make it happen.

Well you just got a budget agreement. The Paul Ryan and Patty Murray budget agreement was bipartisan.

Yes. Look I’m always going to remain hopeful that people can work together. Literally, the last thing I was working on was a bipartisan agreement in the Senate Banking Committee on housing finance reform that most people thought could not even get this far. So I believe we should try to work together. But I think that the hard line view of the tea party types have made it harder for Republicans to come to the table and get things done even when they feel it's in their overall political and policy interest.

Do you have any regret from your time with Obama, whether it was personal or policy?

On the fiscal side, I feel proud that under the most difficult circumstances we made the tax code at the top and the bottom significantly more progressive. I'm proud of my role in helping to get the payroll tax cut. And the extension of the refundable tax credits and the fact that we helped fend off what could've been extremely harmful cuts to programs like Medicaid.

What I feel worst about is that I think that the path of domestic spending -- discretionary spending -- at this point does not allow our country to fulfill its historic mission of investing in the children and the future. And those are the investments that don't have a real constituency now. That they are the investments that one generation needs to make for the next.

Are you going to be on Twitter now?

I have not made that decision yet. But I am aware that the consequences of a Twitter mistake have gone down dramatically in the last week.

What is your health care situation? Are you going to be an Obamacare subscriber?

I’m very fortunate. My wife is a gainfully employed television writer who can put her husband on her health care.

What is next in store for you? Should we not be surprised if you ended up back in public service?

I will always feel that public service is my life's work and the way that I gain the most spiritual and personal satisfaction ... At the age of 55 and almost 30 years of full-time public service, I consider the next two, three years to be a break from that path not a change with what I overall plan to do with the rest of my life.

So I'm going to start printing out the Clinton/Sperling 2016 bumper stickers, okay?

Well, I am over 35. [He laughs and then goes off the record.]

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