By Ben Cohen
I’m not sure what to make of this, but the Huff Post is running this as their lead article, so I’m guessing it is legit. Robert Kuttner appears to have gotten hold of an email conversation between President Obama and Rahm Emmanuel, discussing the ineffectiveness of the Summers/Geithner approach to the banking crisis. One thing is clear (if true, of course), the Obama team is acutely aware of the problem, and how we got into the mess in the first place. The full article can be read here.
The crucial quotes:
I’m concerned that I’m getting only one viewpoint on how to solve the
banking crisis, from Larry and Tim. A kind of echo-chamber effect sets
in where they talk mainly to Wall Street and to each other, and
different views are not heard…..
The problem is that neither the financial markets nor public opinion is
buying it. My recovery package can’t work if the banks keep dragging
down the economy, and time is not on our side. We’re burning through
money that will be very difficult to get Congress to replenish if we
blow it this time……
Also, Rubin is constantly on the phone to everyone. His fingerprints
are all over this mess, but people still take him seriously. Is he
looking out for the system, or for Citi and Goldman? I’m beginning to
have buyer’s remorse that we hired so many of his protégés.
Here’s what I recommend:
Some of the best sessions in the campaign were the times when you
put fifteen people with different views around a table, let them argue
it out, and then you decided. As long as Larry and Tim are heading the
economic team, we can’t very well exclude them, but we should bring in
others–and you should hear this argument in the raw, and not filtered…..
We certainly don’t want
self-interested people like Rubin. This is also not the time for
bipartisanship; we can get Republican and Wall Street input at a
separate meeting (in any case Geithner more or less speaks for Wall
Street.) Paul Krugman has been very critical and ahead of the curve, if
nasty to us, though his last column on the budget was kind to you
(finally!) But he also plays a journalist role, and he might be tempted
to use what he learned in a column, even indirectly. This also
precludes people like Kuttner. He’s very friendly to you, but he’s been
pretty hard on the economic team. I don’t quite trust the guy.
Ben Cohen is the editor and founder of The Daily Banter. He lives in Washington DC where he does podcasts, teaches Martial Arts, and tries to be a good father. He would be extremely disturbed if you took him too seriously.