Washington Watch

Congress shows Obama who's boss. How bad is the US economy? So bad that Summers and Geithner are skipping tennis camp this year
April 25, 2009
Obama's tussles with Congress

The first weeks of any administration are marked by a jostling for power as Congress, regardless of political affiliation, reminds the new president that it controls the money. When he let Speaker Nancy Pelosi write the stimulus bill, Obama started losing the fight. The Republicans seized the chance to run a "Democrats-as-usual" campaign over the bill's special clauses for research on catfish genetics and skin bloom on grapes. Such gems, inserted by congressman with an axe to grind or a donor to reward, are known as earmarks, and after campaigning against them, Obama has said he'll let them through just this once and fight them later.

Later may not be so easy. Obama is having trouble with his centrist Democrats, who are not sold on his strategy of spending his way out of the recession while pushing ahead with health and education reform. Senator Kent Conrad, chairman of the budget committee, has said there aren't enough votes to pass Obama's budget with its $1.7 trillion deficit and $634bn for health reform. "Some of us have a real pause about the notion of putting substantially more money into the healthcare system," he warns.

Then there are the Democratic conservatives, the 49 congressmen who represent districts that voted for McCain last November. Some of them voted against the $410bn spending package for this fiscal year and Obama faces another revolt over the plan to let Bush's tax cuts for the wealthy expire next year. The heart of the resistance will be in Arizona, where Democrats Harry Mitchell and Gabrielle Giffords dread the prospect of seeking re-election at the same time and in the same state as John McCain.

Congress has been emboldened by the way its approval ratings are rising while Obama's have fallen. The latest Gallup poll found that Congress, whose approval ratings were a lowly 19 per cent in January, are now at 39 per cent, their highest in years.

The Democrats sunk Freedman

The Democrats are not prepared to back Obama's personnel choices either. Chas Freedman, a former ambassador to Saudi Arabia, withdrew from consideration for head of the national intelligence committee. The vicious campaign against him was launched by the neocons and the Israel lobby—but the Democrats sunk him. Nancy Pelosi found him too pro-Chinese on Tibet. Senator Chuck Schumer talked of his "concerns" about Freeman's views on Israel. And Diane Feinstein, who chairs the Senate intelligence committee, sidestepped supporting him after finding out that Freeman said in 2006 that the China threat is merely "a great fundraiser for the hyper-expensive advanced weaponry our military-industrial complex prefers to make and our armed forces love to employ." At the time, he was a board member of the China National Offshore Oil Corporation.

Geithner and the propeller heads

Nick Bollettieri, former coach of Boris Becker and Andre Agassi, runs an exclusive tennis camp in Florida. For years—and through various crises—he has had a booking for a week in March from treasury secretary Tim Geithner and Larry Summers, head of the Council of Economic Advisers. This year they cancelled.

But Geithner still has time to keep up his linguistic skills. Geithner, whose father worked for the US Agency for International Development, grew up in Zimbabwe, India and Thailand. He studied Chinese at Dartmouth and learned Japanese as a financial attaché in Tokyo. He recently emailed Susan Blader, his Chinese teacher at Dartmouth, to say how proud he was that he was able to talk to Chinese premier Wen Jiabao in Mandarin. This does not bode well for secretary of state Hillary Clinton's attempt to wrest back control of China policy from the treasury.

Obama, who seems as bad as his predecessor at inventing nicknames for his aides, calls Summers "professor" and has dubbed his economics team (he meets them daily, after his intelligence briefing) the "propeller heads." In response, Peter Orszag, director of the White House office of management and budget, bought a dozen baseball caps with tiny propellers on top. He solemnly handed out "propeller-head hats" at a recent meeting so the team could wear one when Obama came into the room.

Huckabee smells something

The star of the recent Conservative Political Action conference was former Arkansas governor, Mike Huckabee, who is gearing up for a second run at the Republican presidential nomination. He called himself a prophet for having warned the Republicans against being seen as the party of Wall Street. "We didn't lose because of social conservatives and because we're against putting babies in wastebaskets," he insisted. "We lost because we were too tied to people who would spend $1,400 on a wastebasket, like the clueless John Thain of Merrill Lynch who also spent $87,000 on an office rug. Where I come from, $1,400 is three courses at the University of Arkansas-Little Rock and $87,000 is the price of a house." Huckabee dubbed the stimulus package the "Congressional Recovery Action Plan." "If it looks like Congressional Recovery Action Plan… and smells like Congressional Recovery Action Plan…" he said, hammering his point home for those who missed the acronym the first time.