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Mitchell Bard

Mitchell Bard

Posted: January 26, 2010 12:55 PM

An Open Letter to the President: It's Time for Change, Not Spending Freezes

What's Your Reaction:

Dear President Obama:

I know you are a very smart guy. After all, not only have you graduated from Ivy League universities like Columbia and Harvard, and taught a heady subject like constitutional law at one of the top law schools in the country, but you have had real-world success, reaching the highest office in the country while still in your forties (and managing to do it while being an African American candidate named Barack Hussein Obama).

So I write this letter with a tremendous amount of respect and admiration for what you have accomplished, as well as with faith that you are smart and savvy enough to understand what is happening in our country right now. After all, during the presidential campaign, you were often criticized by commenters (including me) for not responding strongly enough to the lies and dirty tricks thrown at you by John McCain, Sarah Palin and the Republican party, and yet you showed in the end that you knew what you were doing, better than we did. You had properly measured the temperature of the country, and you were rewarded with the presidency.

You also have to know how much your candidacy meant to so many people. You weren't just another aspirant for high office, you captured the hope and optimism of millions of previously disaffected voters. I think I am a good person to comment on this because I never viewed you as a savior, but rather as a really smart, seemingly competent politician, who was a mainstream Democrat more than a progressive. So my expectations weren't as sky-high as many others. But it is clear that you were elected to the presidency by a coalition of Americans -- young and old, progressive and moderate, urban and rural, East and West, North and South -- who agreed on one thing: change.

Change was your campaign slogan (and a good one), but it was more than just that. When McCain tried to co-opt the change message, it fell on deaf ears. Why? It wasn't credible. People really believed you would bring change. They believed it was something to which you were committed, not a marketing strategy you just signed off on.

Which brings me to the reason I am writing you this open letter today. President Obama, I think I speak for many, many Americans when I say: Have you forgotten why you were elected?

The Republicans want Americans to believe that the election of a GOP candidate to the U.S. Senate in liberal Massachusetts was about a glorification of the Republican party, the death of the Democratic party, and a rejection of health care reform. But anyone paying attention -- and I have to believe you know this -- could see it was about anger at the raw deal the average American is getting right now, all while big corporations (namely, banks) prosper. The two issues underlying the Massachusetts anger were unemployment and Wall Street, because they stood for this larger principal. People are out of work, and yet the banks are foreclosing mortgages and failing to lend to citizens and small businesses with good credit, all while paying their executives billions of dollars in bonuses (and after the American taxpayers forked out hundreds of billions of dollars to bail out the banks).

Mr. President, it's not that complicated, and I know you know this. I don't agree with the voters' choice in Massachusetts (as I wrote last week, I think they cut off their noses to spite their faces), but I understand the anger. And after the election, I thought to myself, "Finally, now the White House will have to admit that there is a problem and do something about it."

You see, Mr. President, while I think you have been a good administrator, making some smart executive decisions in ways that your predecessor did not, you have failed to let the American people feel like you are committed to change. I believe that appearance can blur reality (like with health care, where a flawed but mostly positive bill is unpopular mostly because the Republicans did a better job of demonizing it and lying about it than you and the Democrats did of advocating for it), but the reality of many of your decisions in your first year do not comport with the idea of change.

Specifically, let's talk about the two issues that boiled over in Massachusetts: unemployment and Wall Street. A lot of people smarter than I am have argued that the message from Massachusetts is that your administration has to change course on these two issues. History shows that when Democrats try to be "Republican Lite," it's a recipe for disaster (like in 2002). Why would voters choose a fake Republican when they can have the real thing?

No, what will turn around the fortunes of your presidency and the Democratic party is for you to re-embrace the change you promised all of us in 2008. And really put change into action.

I will give you some concrete examples relating to Wall Street and unemployment. We all know that the financial crisis of 2008 was precipitated by the accumulation of nearly 30 years of deregulation, which allowed financial executives to take crazy win-win risks (they got paid massive bonuses, even as their bets lost). And yet, you have a lead economic advisor (Larry Summers) who is best known for being a deregulation advocate in the Clinton administration (and continued with the same kind of language while working for you), and you have a treasury secretary, Timothy Geithner, who, while with the New York Federal Reserve, was smack in the middle of the AIG disaster (and he just came out against the Move Your Money initiative).

In short, the leaders of your economic team are (in both substance and appearance) closely aligned with Wall Street. How is this change? It isn't. And it only stokes Massachusetts-like anger.

As for unemployment, Americans are out of work and angry. They may understand, on some level, that your administration didn't create this mess, and that there is only so much that you can do to get the country out of it. But they want to know that you are on their side, and that you are doing what you can. So it is puzzling why you would respond to the Massachusetts loss by announcing a plan for a spending freeze. Who will like this proposal? Well, Republicans, who will never come over to your side anyway (after all, it was something McCain proposed during the campaign), and the financial industry. What won't it do? Help create jobs. So, again, you are viewed (not unfairly) as cozying up to the banks while neglecting average Americans. Paul Krugman called your freeze proposal "appalling on every level" and "bad economics."

Mr. President, based on your track record in running your campaign, you earned from me immense patience and respect for your approach. I trusted that you must know what you were doing, even as you appointed people like Geithner and Summers, stayed quiet on health care, let the Democrats in the House and Senate take control of key legislation like the stimulus, and sought to work with Republicans even after, again and again, they made it absolutely clear that they were not willing to make any deals that would give you any kind of political success. As you made what appeared to be questionable judgment after questionable judgment, I gave you a lot of slack, trusting you had a plan.

Well, Mr. President, I'm here to tell you that with your reaction to the Massachusetts election, I have officially rescinded your benefit of the doubt. And I know that many, many Americans who support you agree with me. To be clear, I (and we, I'm sure) still support you and still believe you have the intelligence and character to be a great leader and president. It's just that it's time for you to recognize that you've made a mistake and right the ship.

It's time for you to take actions that show Americans that you support them, not Wall Street; that you know they are out of work, and this fact is a priority driving your administration. It's time to stop making proposals that will assuage your detractors on the right and the powers-that-be in the financial industry. (Who cares what Republicans think? The party's approval ratings are lousy, too.)

People care about jobs and about fairness (they're struggling while Wall Street prospers). They don't care about deficits (that's the main concern of the bank-leaning advisors in your administration and Republicans). Sure, deficits are important, and long-term fiscal prudence is a good thing. But you have to prioritize, and right now, jobs should be the key.

It's time to be bold, Mr. President. Where is that audacity of hope? It's time to introduce a bold jobs-creation bill, and to replace your Wall Street-stained economic team members with individuals not tainted by having helped cause the financial crisis. Trying to make your detractors and those that created our current mess happy is no way to lead, and no way to galvanize support. More importantly, it's no way to solve our problems. It's time to declare to the American people, in words and deed, that starting today, you have received the message of Massachusetts (not the fake meaning assigned by Republicans, but what the voters were really saying). It's time for you to be the sincere, inspiring leader for whom they voted.

In short, Mr. President, it's time for change. Only time will tell if the country can recover from the disastrous presidency of George W. Bush. I can only imagine what further damage would be inflicted by more Republican rule. It's up to you, Mr. President, to correct your course and lead us to a better future. You've shown once that you can be an advocate of change. It's time for you to demonstrate once again that you are the man for the job. Please.

Respectfully,
Mitchell Bard

 

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Thordeer
Greed has won over principle.
10:09 AM on 01/27/2010
Amen. Where is the hope? The audacity?

I don't even know what he's trying to accomplish any more. It's very sad. I agree with you: Obama abandoned his base, and they said in Massachusetts "you need to follow through." Then he said the very next day it's all about jobs, the working people. THEN HE OFFERS A SPENDING FREEZE!

Weird.
09:43 AM on 01/27/2010
You hit the nail right on the head.I,like millions of Americans who voted for Obama,am still looking for the "audacity of Hope".He is vacilllitating too much,and in the process,defeating any hope people had in him.the President is sounding and acting like any other President,and not like the President who promised to "shake the way business is done in Washington."
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JoeTheProgrammer
I love dogs.
09:14 AM on 01/27/2010
We do care about deficits. The dollar is going down the toilet. Inflation is sure to follow. Inflation would be the death knell of this presidency. So go ahead, keep pushing for more spending. Spending only creates temporary jobs or government jobs. Building roads and bridges won't encourage new business like it did in the past.
09:07 AM on 01/27/2010
Obama's new slogan:

We "Hope" you don't realize, there is no "Change".
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marmmalou
You have a voice. Use It.
08:09 AM on 01/27/2010
President Obama, stand up for Americans and have the Audacity to say charging 30 percent interest is immoral and should be illegal. Massachusetts used to have a law limiting interest to 18 percent. How can anyone get out of debt paying 30 percent? The answer is they can't and that's exactly what Wall Street bankers want.
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Carl Caroli
Give peace a chance
06:48 AM on 01/27/2010
Amen.
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StevenWells
Objects in the avatar are larger than they appear
06:19 AM on 01/27/2010
I see column after editorial after commentary such as this - have for months - and I keep coming to the same question: doesn't anybody at the White House READ these things?

And it's not just pundits and economists and strategists; more and more voters are expressing the same thoughts. How is it that this administration is missing what most of the country seems to know?
AlanInGA
Why Turn Around When You Can Just Pivot
08:04 AM on 01/27/2010
Because they do not give a rats a$$ about anything other than power and keeping the status quo.

I voted for Obama.

Everything that has happened since January of last year has been pretty much a disaster.

The biggest disappointment for me is the people he has placed around him -- Summers and Rubin.

All credibility was thrown out the window when that was done.

Add to the fact that Geithner hired a Goldman Sachs lobbyist as his chief of staff further erodes confidence.

As others have stated, he is oblivious to the fact that his voters are incredibly angry.

Below are 15 Obama campaign promises that have not been met.

Several of these defined the Obama campaign. Many of these are why I voted for him.

http://www.politifact.com/truth-o-meter/promises/rulings/promise-broken/
05:08 AM on 01/27/2010
Bank Interest = Profit. I have fantastic credit and I got letter from Citi saying my interest was going to 30% from 3%.Need I saY MORE.
09:31 AM on 01/27/2010
I just cancelled 2 of my cards after they said they are going to start charging me an annual fee.
I said see ya, bye bye.
04:37 PM on 01/27/2010
boston998: Good move. Now, if you haven't already, move your money out of the Big Bank, and into a local/regional bank. Hurt 'em in the pocketbook. Introduce yourself to the manager of the community credit union/bank, and discover face to face what they will do to get your business.
04:55 AM on 01/27/2010
Unfortunately Obama has no idea about economics. So he is presented a multiple choice set of options with a lot of warnings attached to them, and he is making his choices out of fear. To depress aggregate demand during a recession is just wrong economic policy.
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03:54 AM on 01/27/2010
Harvard or not, this guy and some of his side kicks just are not listening to the people who put them there. I don't care what degree anyone has! Being elected is one thing, BUT KNOWING WHY YOU WERE ELECTED IS QUITE ANOTHER AND obama has not worked that out yet 100%. His SOTU address will hammer that home, just how out of touch he has become in only a year in office
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03:44 AM on 01/27/2010
where i come from they call this a.. licking! Harvard or not, this guy and some of his side kicks just are not listening to the people who put them there. I don't care what degree anyone has! Being elected is one thing, BUT KNOWING WHY YOU WERE ELECTED IS QUITE ANOTHER AND obama has not worked that out yet 100%. His SOTU address will hammer that home, just how out of touch he has become in only a year in office
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AlaskanWannaB
8 years of insanity and NOW you're mad
03:13 AM on 01/27/2010
Have you ever thought that Obama may be calling the right-wingers' bluff by proposing to cut spending! Maybe, he is trying to show the world that the Rethugs do not want to cut spending (i.e., Bachman, Boehner and others). I say let them try to get a bill through to see WHO really wants to cut spending. The Rethugs got the tea baggers riled up to the point of insanity about spending, spending, spending.

Let's see who in the House and the Senate will vote to freeze spending and cut programs. Let's the Rethugs put the money where their mouth is.....
AlanInGA
Why Turn Around When You Can Just Pivot
08:12 AM on 01/27/2010
Obama's $25 billion in savings represents .2% of this years budget deficit of $1.3 trillion dollars.

As others have stated, this is a rounding error.

Also, with the Democrat congress, the non-discretionary Federal budget has increased by over 20% in the last year.

Raise you by 20 and lower by .2

Smoke and mirrors defines his presidency.
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AlaskanWannaB
8 years of insanity and NOW you're mad
09:16 AM on 01/27/2010
Well, I must ask you this since you appear to be rational:

Do you really believe that anyone could correct the problems caused by the Bush administration?

All Obama has proposed was to raise the taxes to the level they were before Bush cut taxes for the rich. I remember getting those $50 to $100 from Bush during his, supposedly, tax cuts. He appeased the ignorant by giving them a paltry $50 and reduced the taxes on his wealthy friends tremendously.

Obama is trying to fix a problem that no one knows how to fix, including you and me. It took 8 years for Bush to screw this country royally. Can you give the man 4 years to try the fix the problem.

Obama will make mistakes and he will, no doubt, enact some policies that will make things worst....but he is trying.

I am just getting sick of the right trying to blame Obama for a fluid situation that resulted from previous administration.

An analogy: Bush burns down a school house and the house is still in ruins when the new person takes over the school. Do you blame Obama for burning down the school house and also blame him for not rebuilding it if he is having a difficult time finding the resources to rebuild it. Or do you blame Bush for burning it down and give Obama a little credit for trying to rebuild it (or finding the resources to rebuild it)?
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AlaskanWannaB
8 years of insanity and NOW you're mad
09:17 AM on 01/27/2010
I will give you some credit if you characterize what went on during the Bush administration. Please...enlighten me?
AlanInGA
Why Turn Around When You Can Just Pivot
08:33 AM on 01/27/2010
Let me preface this by saying that I was not a fan of George Bush.

Correct me if I'm wrong.

What was the unemployment rate prior to the financial meltdown?

Pretty much the same as during the Clinton administration --- ~5%.

Between 2001 and 2005 GDP grew at about 2.5% per year.

We may all agree that higher incomes benefited more, but all in all, the economy was humming along quite nicely under Bush.

This country is suffering because of a lack of financial regulation, the expansion of Fannie and Freddie, and pure greed.

To put us back on the right track, substantive decisions need to be made by our leaders.

To date, has not taken place.

Will it happen? My answer is no.
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IssuesInFocus
02:33 AM on 01/27/2010
Great post. You have emphasized my sentiments well. Cannot find a thing to add-- other than, he must re-shuffle his cabinet.
The members of the Economic Roundtable-- primarily Summers and Geithner are adding to his credibiity problem. They are seen and believed to be a liability to his getting his agenda going.
Fully accept the fact he's politically smart and savvy. But seeing him coming around to McCain's idea of a freeze which he described as using a scapel.. when there are other solutions is surprising. I can only hope he realizes a great deal of us still have faith...that the Barack Obama we voted for is still in some way connected us.. not lost --steam rolled by bashers from the GOP. I eagerly await his address. And for what its worth.. I dont care about the deficit... want to see jobs, and more jobs, created. And fast !! http://www.youtube.com/watch?v=5NZCWsbvS50
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02:58 AM on 01/27/2010
The banks are not loaning money. Without money, employers cannot use the leverage of loans to hire people and make payroll. Jobs left this country under the Reagan administration. What we have experienced over the last year was the highly publicized final nails in our job market. No one can bring back the jobs that dried up in our country-- no one! It's a hard fact. It took several administrations to drain us dry and this one year mark placed on Obama to create miracles after Bush and Paulson destroyed our country is sheer lunacy.
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AlaskanWannaB
8 years of insanity and NOW you're mad
09:20 AM on 01/27/2010
Thank you for being rational?

What the Republicans and their ilk don't seem to understand is that Obama did not make the situation worst. The floodgates were opened during the Bush administration and no one seems to know how to stem the tide. You cannot blame this administration for additional job losses.

Unfortunately, the stimulus has not helped in a substantial way. Until we get the big corporations to bring jobs back stateside, we are doomed. We have NAFTA to thank for that...and greedy corporations who put profits over people.
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speeter
02:04 AM on 01/27/2010
Time for change like measures 66 and 67 in Oregon passing by wide margins tonight. These measures raise taxes on the wealthy and corporations to fund schools, public works and are one small step in the direction of social justice. This is what a real tea-party looks like, GO OREGON!! Now the rest of the country.
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AlaskanWannaB
8 years of insanity and NOW you're mad
09:21 AM on 01/27/2010
Kudos to Oregon!
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1murillo
Can't be neutral on a moving train - Zinn
10:46 PM on 01/26/2010
Bard,
I agree with the tone and substance of every paragraph you've posted.
We need several more Move Your Money - type campaigns because by using our collective work and sweat we can start to turn this ship.
Creativity will save us. Consider that millions of dollars, hours, and concern have been sent to Haiti (of course it's horrible that an earthquake of such magnitude hit), yet we are seemingly incapable of helping ourselves.
It is possible to choose a US city where we can send workers, money, healthcare workers, etc, to rejuvenate that city. And then another. Even if we were to help one city it would be worth it.
The next step would be to choose a city.