Although nearly two months remain until President-elect Barack Obama takes office, he has moved onto center stage on the deepening economic crisis, declaring he will launch a massive jobs program to jumpstart the economy where it counts: in Main Street communities across America.
Speaking directly to the American people on Saturday in his second weekly video address, Obama said he has told his advisers to draft an economic recovery plan aimed at adding 2.5 million jobs over the next two years, by investing billions of federal dollars to rebuild roads and bridges, modernize public schools and build wind farms, solar panels, fuel-efficient cars and other alternative energy technologies.
This is exactly the kind of bold step called for by labor and progressive leaders and a wide range of economists.
Just a few days before Obama announced his plan, progressive-oriented economists held a press conference calling for immediate enactment of a big and broad economic recovery package to help the “real” economy and avert massive joblessness.
The economists released a letter, signed by Nobel Laureates Joseph Stiglitz and Robert Solow and more than 300 colleagues from 36 states, urging immediate, decisive action.
Speakers at the press conference included Alan Charney of USAction, Dean Baker of the Center for Economic and Policy Research, Eileen Appelbaum from the Center for Women and Work at Rutgers University and Lawrence Mishel of the Economic Policy Institute.
The plan Obama announced goes well beyond the stimulus measures these economists called for, projecting spending what some estimate at up to $700 billion to put Americans back to work in a greening economy.
In another indication Obama intends to continue the grassroots participatory approach that characterized his campaign, his transition web site, change.gov, features comments from several Americans who responded online to his recovery plan announcement.
Val T. from Albuquerque, N.M., wrote:
‘I am very concerned about the crumbling infrastructure of our bridges and roads, which we are so dependent on for everything … I am also thrilled that you will create/encourage jobs in alternative energy generation … Creating jobs while investing in the future — it is a dream come true!’
Janet F. from Depoe Bay, Wis., said:
‘Let’s treat this mess as a golden opportunity. President-elect Obama has America’s attention and goodwill so this is the time to do the hard things …
“Yes, we need new jobs. Let’s make them green.
“Yes, we need to help the auto companies. Let’s demand green solutions.
“Yes, we need to repair our infrastructure. Let’s think of green ideas on what to build and repair and on what to do with the waste that will be created.
“Yes, we need to repair schools. Let’s make them green.
“This is our opportunity to do it right. Now is the time.”
Chet C., a teacher from Staten Island, N.Y., wrote:
‘One other area that needs help is local and state governments that are planning absolutely draconian budget cuts and service fee increases over the next year. In NYC, the Metropolitan Transportation Authority is planning fare increases of as much as 23 percent and less service. CUNY and SUNY are planning major tuition hikes, and the city Department of Education is cutting school budgets. I am an NYC high school teacher, my school has had its budget cut twice this year alone … This in the face of an ever increasing enrollment …
“And I am sure you know, we are far from the only school in this nation facing this situation.”
The change.gov web site invites the public to “share your economic story” online. “Your voices are part of an important dialogue at a crucial moment in our national history. … let us hear from you.”
Economy: job number one
Meanwhile, with corporate giants like Citigroup and General Motors on life-support and confidence in the economy continuing to plummet, Obama moved quickly on Monday to announce his pick for Treasury secretary — his first Cabinet announcement, naming New York Federal Reserve chief Timothy Geithner to the post. He also named former Clinton Treasury Secretary Lawrence Summers as director of the National Economic Council, a key White House economics advisory role, Christina Romer, a University of California Berkeley economist, as chair of the Council of Economic Advisors, and Melody Barnes, an executive vice president at the liberal Center for American Progress and a former chief counsel to Sen. Edward Kennedy, as director of the Domestic Policy Council.
All are seen as extremely knowledgeable, sharp and able.
Romer, a prominent scholar of the Great Depression of the 1930s and a proponent of strong government intervention in the economy, is said to have a reputation for “pragmatism and center-left policy views,” the Boston Globe reports. ‘She’ll be weighing in on the side of a large stimulus,’ fellow Berkeley economist J. Bradford DeLong told the Globe.
Some are leary of Geithner because as New York Federal Reserve head he has been involved in recent government financial decisions that are now being hotly criticized. It is not clear exactly what role Geithner played in those decisions. He is said to be independent-minded and “non-ideological.”
Summers, while Treasury secretary, backed deregulation of the financial sector, a policy now widely blamed as a major cause of the current crisis. More recently, as Harvard president, he drew a storm of criticism for disparaging comments about women’s math and science abilities. National Organization for Women leader Kim Gandy, nevertheless, responded favorably to his nomination, saying Summers “has written and spoken fairly extensively on the issue of women’s wage inequality and the impact that has on the country.”
Geithner, Summers and other Obama economic advisers have connections to former Clinton Treasury Secretary and Citigroup director Robert Rubin, who was a big advocate of deregulation. This has generated some concerns in progressive circles.
However as far back as last August, speakers at an economics forum during the Democratic Convention in Denver noted that sections of the party, such as Rubin and others, who supported deregulation in the 1990s, were shifting away from those policies in response to the new economic realities.
In announcing his top economic team, Obama said there was a ‘rare’ consensus between conservative and liberal economists ‘that we need a big stimulus package that will jolt the economy back into shape,’ one that is focused on job creation.
‘We have to put people back to work,’ Obama said.
Policy, not personnel
Following Obama’s press conference, Robert Borosage, co-director of the Campaign for America’s Future, a prominent labor-progressive alliance, acknowledged the concerns about the ties to Rubin, “who opposed the regulation of derivatives and other measures blamed for the economic crisis,” and whose Citigroup “has just received a $20 billion cash infusion and hundreds of billions of dollars in loan guarantees from taxpayers.”
But, Borosage said, “It’s not the personnel, it’s the policy. And on this, Obama has been clear. He’s announced a massive recovery plan based on putting people to work with public investment in areas vital to our future.”
“The crisis we face makes Rubinomics irrelevant,” Borosage said. “Deficit spending must go up, finance must be re-regulated, trade imbalances must be reduced and manufacturing can no longer be scorned.
“Obama is choosing experienced hands for the crisis, trusting that their experience does not impede the new thinking needed to get us out of this hole. He’ll set the direction. And so far, he’s on course.”
As an indication of today’s dynamics on economic policy, Rubin recently co-authored a New York Times op ed article with Jared Bernstein of the labor-linked Economic Policy Institute, in which he joined Bernstein in citing declining union membership as a key factor in the economic crisis. “The benefits of productivity growth have largely eluded working families,” the two noted. “A true market economy should have true labor markets in which labor and business negotiate as peers. Many years ago, the economist John Kenneth Galbraith argued that collective bargaining was necessary so workers had the countervailing force to bargain for their fair share of the growth they’re helping to produce. To re-establish that force, workers should be allowed to choose to be unionized or not.” This was a reference to the importance of passing the Employee Free Choice Act, a top labor priority, which would eliminate obstacles to workers forming unions at their workplaces.
Obama’s expected choice for attorney general, Eric Holder, would be the first African American to head the Justice Department. He was a Clinton deputy attorney general under Janet Reno. Some have expressed concern that Holder in private law practice has represented Chiquita Brands International in a criminal case related to Chiquita’s payments and other support to Colombian death squads. Others worry about positions he has taken on penalizing marijuana users and other issues.
However the right-wing National Review has had a virtual fit over the prospect of Holder’s nomination. Holder is “a conventional, check-the-boxes creature of the Left,” the journal raged. “He is convinced justice in America needs to be ‘established’ rather than enforced; he’s excited about hate crimes and enthusiastic about the constitutionally dubious Violence Against Women Act; he’s a supporter of affirmative action and a practitioner of the statistical voodoo that makes it possible to burden police departments with accusations of racial profiling and the states with charges of racially skewed death-penalty enforcement; he’s more likely to be animated by a touchy-feely Reno-esque agenda than traditional enforcement against crimes; he’s in favor of ending the detentions of enemy combatants at Guantanamo Bay and favors income redistribution to address the supposed root causes of crime.”
With a checklist like that, it appears there is much for progressives to like in Holder.
Other interesting Obama choices that have not drawn as much attention include:
Patrick Gaspard, former vice-president for politics and legislation at 1199 SEIU, New York’s labor powerhouse health care union, will be Obama’s White House political director, according to several reports. Gaspard, a Haitian American, left 1199 to become national political director for much of Obama’s election campaign and is now deputy personnel director for the transition. In 2004, he was national field director for America Coming Together, a grassroots get-out-the-vote effort.
Listing him as a “rising star” two years ago, New York’s City Hall news monthly said Gaspard’s role with 1199 dated back to his involvement in the Rev. Jesse Jackson’s 1988 presidential bid. “The next year he worked closely with the union to elect David Dinkins, the first Black mayor in the city’s history. More campaigns followed: in 1999, Gaspard was working as Council member Margarita Lopez’s chief of staff when Amadou Diallo was shot and killed by police officers in the Bronx. The union was one of the central organizers of the civil disobedience that followed, and 1199 President Dennis Rivera and then-Political Director Bill Lynch asked Gaspard to coordinate those efforts. A position in the political department followed.”
In 2006, Gaspard worked on the union campaign that helped Democrats retake control of the House and Senate. At the time, City Hall reported, “Gaspard sees the potential for change — but only if there is agitation. That, he says, is where he comes in.”
“What is the most important thing you have accomplished so far?” the reporter asked Gaspard. “Raising two children of color in America,” was his response. “Two years from now, what do you want to have done? ‘That’s the easiest question I’ve ever been asked — I want to begin to repair the imbalance in the Supreme Court by electing a Democratic president.’”
Ellen Moran, executive director of EMILY’s List, the political action organization “dedicated to building a progressive America by electing pro-choice Democratic women to office,” will be Obama’s director of communications. Moran’s long record in political campaigning includes managing the AFL-CIO’s Wal-Mart corporate accountability campaign and serving in the labor federation’s political department.
Tom Head, a Mississippi civil liberties and civil rights activist, comments at About.com, “While she will not be the public face of the Obama administration, she will craft its public message … she comes to the position from an unusual activism-focused perspective.”
Linda Darling-Hammond, a Stanford University education professor well known as a progressive public school reform advocate and teachers union supporter, has been named by Obama to head his transition education policy team.
Darling-Hammond is known for her research on effective teachers and schools. At Stanford, she founded and is co-director of the School Redesign Network, which works to improve underperforming schools. She has written more than a dozen books on education, and is sought after as an expert and public speaker.
According to the San Francisco Chronicle, some observers believe the selection of Darling-Hammond “shows that Obama is leaning toward a more teacher-friendly approach than has been seen in recent years.”
“It’s such a clear change from what we’ve had,” Marty Hittelman, president of the California Federation of Teachers, told the Chronicle. ‘Someone who’s friendly to labor. Someone who wants to work with teachers.’
The article reported, “Darling-Hammond had high praise for teachers and their unions at the spring convention of the state’s other teachers’ organization, the California Teachers Association. ‘This is the most important group in California, as far as I’m concerned,’ she said during her keynote address. ‘The teachers who lead our urban school systems are the folks who will determine the future of this state and the future of the nation.’”
The Chronicle noted, “It’s been a long time since teachers’ unions have felt so welcomed by federal education officials. Although the No Child Left Behind Act of 2002 is credited with forcing educators to pay attention to every child’s performance, many teachers believe that its tone is punitive and that its emphasis on multiple-choice testing has drained the joy out of teaching.
“Under Obama, Darling-Hammond suggested, things will be different.
“‘You’ll see public schools focused on preparing kids to problem-solve, think critically, design research and produce strong intellectual work as a result,’ she said.”
Drowned out in the flurry of economic news this week are other expected high-profile Cabinet nominations, including Hillary Clinton for secretary of state and Tom Daschle, former Senate majority leader, for secretary of health and human services.
More about those later.