President Barack Obama faces a rugged week with multiple challenges on the economy and in geopolitics. He has a prime time press conference on Tuesday to press his case.
** His embattled treasury secretary, Tim Geithner, under fire for helping enable massive bonuses to executives of the bailed-out insurance giant American International Group (AIG), is rolling out his plan to deal with the banks' toxic assets. The credit gears are still largely stuck, along with the economy.
Geithner's plan is to combine $75 billion to $100 billion in public bailout money, leveraged with the Federal Deposit Insurance Corp. and Federal Reserve, with private funds to buy $500 billion in toxic assets.
Is this another bailout to Wall Street? Or is it needed pragmatism to work with a deeply troubled, farcically entitled though still necessary private financial sector?
** Obama's budget proposal is running into fierce resistance from Republicans, who insist that the budget will be busted in the wake of a Congressional Budget Office estimate that deficits would be higher than the White House thinks. Some moderate Democrats in the Senate are also antsy about the scale of new spending Obama proposes to both jump-start the US economy and transform it for the long run.
So Obama and Vice President Joe Biden are both headed up to Capitol Hill for separate meetings with senators on the budget.
On the other side, some commentators like Paul Krugman complain that Obama isn't doing enough. What's a whipsawed president to do?
** Obama's also developing new regulations on the behavior of financial institutions, including executive compensation. The plan for the AIG bonuses is to deduct them from bailout funds. But that's closing the barn door after the horses are out.
It seems clear that Wall Street executives still want to make tons of money. But how much do they have to make for the country to avoid a capitalist strike? And how realistic is that?
As Obama put it last night on 60 Minutes: "One of the things that I have to do is to communicate to Wall Street that, given the current crisis that we're in, they can't expect help from taxpayers but they enjoy all the benefits that they enjoyed before the crisis happened. You get a sense that, in some institutions that has not sunk in. That you can't go back to the old way of doing business, certainly not on the taxpayers' dime. ... I mean there were a whole bunch of folks who, on paper, if you looked at quarterly reports, were wildly successful, selling derivatives that turned out to be completely worthless."
** Obama's new Afghanistan strategy review, expected to be completed last week, now apparently won't be released until next week, when an international conference on the troubled nation convenes in the Netherlands at The Hague.
Obama has big decisions to make about Afghanistan's current government, which most regard as corrupt and dysfunctional, as well as the best military and civil strategies to achieve what appear to be America's more limited goals there. While desiring to stabilize the country, the administration appears to be reverting to the original US goal in Afghanistan: Denying it as a base of operations for transnational Islamic jihadist terrorist organizations.
According to the Guardian, one way to deal with the problems associated with President Hamid Karzai, the Bush/Cheney pick for the job, is to create a new post of prime minister. Special envoy for South Asia Richard Holbrooke just denied this. But it's clearly been under discussion.
** Iran will participate at the Hague conference next week. Obama's video message to Iranians at the end of last week appeared to be rebuffed, though not extravagantly as these things go. Iran's supreme leader, Ayatollah Ali Khamenei, said that Obama hasn't brought real change to America. Khamenei, falsely reported two years ago in the far right media to have died, is the real power in Iran, not the pop-off President Mahmoud Ahmadinejad. How to play Iran -- freshly empowered in the region with the fall of Saddam's regime and intent on a nuclear energy program that could be used for weapons -- is a key part of any new Afghan strategy and the Iraq endgame.
** As he completes the Afghanistan review, Obama is grappling with the situation in neighboring Pakistan, which is quite unstable. A major front burner issue? Increased aerial drone attacks on Al Qaeda and Taliban cadre using the country as a safe haven. They appear to be increasingly successful militarily, but are highly controversial inside Pakistan, in part because of civilian "collateral" deaths and injuries.
New CIA Director Leon Panetta was in Pakistan over the weekend meeting with the country's current leadership. The country, already beset by a jihadist insurgency playing havoc with US supply lines into Afghanistan, narrowly averted chaos last week when the government gave in to the demands of reformers staging a giant march on the capital by reinstating the nation's chief justice.
** America's relations with a resurgent Russia also require some decisions. Obama has had several unofficial high-level emissaries visit Moscow in recent weeks, including former Secretaries of State Henry Kissinger and James Baker and former Senator and presidential candidate Gary Hart with former Senator Chuck Hagel. Russia is already being helpful to the US by providing new supply lines to Afghanistan, and can do more. But will Obama pay the cost?
A bipartisan commission headed by Hart and Hagel called last week for a very different approach to Russia than those of the Bush/Cheney Administration and the Clinton Administration before it, one which could lead to Russian cooperation in South Asia and the Middle East and on nuclear weapons and to the US acknowledging Russian interests in its "near abroad" and working with Russia on any anti-missile shield in Eastern Europe.
The big meeting on Afghanistan is next week, with the G-20 (group of 20 advanced economies) summit after that in London. Obama will meet there with President Dmitri Medvedev. The plan should be locked down.
In normal times, any one of these things would be more than enough to demand constant attention. These aren't normal times.