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Did Obama's Big Apology Turn the Salary Cap into a Magician's Hat?

03/07/2009 05:12 am ET | Updated May 25, 2011

Making sense of the latest headlines requires a big thinking cap and maybe some sedation.

Salary cap spankings for execs at bailed out giants. The President of the United States confessing "I screwed up" on national TV after years (maybe decades or more) of an administration unwilling to concede any "mistakes were made," even in the passive voice. Record numbers of tanking high level political appointments in the first 16 days of the new regime.

This is shocking. But shocking good or shocking bad? PR or substantive? Symbolic gestures or practical policy? Valuable or not valuable to the national interest and psyche? If enough people believe something does that make it true?

I feel like a pinball in a machine where Travis Bickle, in his more caffeinated mohawk stage, is working the levers. I don't know what to think, which is in keeping with the general unreality of our financial mess at the moment.

I had lunch this week with a friend who's one of the most long-term, successful businessmen, civic leaders, and philanthropists in San Francisco. "You know what this reminds me of?" he posed about the economic calamity. What? "Nothing. I haven't seen anything like this in my lifetime." This lion of the community makes important business decisions every day but even he concedes that "the underpinnings have come out from under us. I don't really know what or who to believe any more." Another high level psychological victim of the Madoff syndrome. "There's a worldwide de-leveraging going on in which everything that seemed strange or unusual, was."

Does that include Mr. Obama's latest actions?

Plenty of people seem to feel good about a commander in chief who admits his imperfection to Anderson Cooper, then serially apologizes on the major networks. Taking responsibility is walking the walk, goes that view, instead of the doublespeak, spin and finger pointing that we're used to from both top Democrats and Republicans going way back. And what can you say to someone who confesses they're guilty? Further accusation and criticism seems unnecessary and ungenerous.

But what's the cost of the "crime"? Should there be a sentence for "screwing up" or an accolade?

See what I mean about confusing? And I don't think I'm alone.

But I do know that a high-level guilty plea, however cathartic for all of us, doesn't by itself fix what was broken.

The same questions come up around the salary cap policy. Bold, absolutely. Dramatic, yes indeed. Sends a message, absolutely. And it's red meat for the vast majority of people in the country who are royally pissed at the regal lifestyles of CEOs running ruined companies. But what practical effect does it have? Is it a gun to the heads of these people or, like SF Mayor Gavin Newsom marching with striking hotel workers a few years ago, is it just a PR popper that has no practical effect 60 seconds later?

I know I'm overusing question marks, but that's an accurate reflection of the questions hanging out there in the culturesphere.

Treasury Secretary Timothy Geithner shared the podium with the president in announcing the cap-no-trade approach. Not to pile on, but didn't he have a little glitch in his own tax background and some hand in the current catastrophe as former president of the NY Federal Reserve?

Another friend who's a hard-working and highly respected plaintiff's labor law attorney notes that a fair number of mega-executives have, as part of their contracts, clauses that would let them claim many millions or tens of millions of dollars in severance payments if their salaries are diced back to a paltry $500k. So not only could they kick off their beleaguered businesses, but under the Obama plan, they might still get ginormous payouts anyway. (I haven't seen the contract terms for the head of AIG or Citigroup, so I don't know if it applies to them. But there probably are more than a few loopholes.)

Public confidence is a big component in the success of our government and our economy; that was one of the major pluses of Barack Obama's ability to inspire. Maybe even symbolic gestures still create that good feeling and good will that will lead us to better lives. One of life's most fascinating and mysterious concepts is the placebo effect. For some percentage of people, sugar pills cure them.