Obama lacks a secretary of Selling It
The first time Treasury Secretary Timothy F. Geithner was sent out as point man to sell the Obama administration’s financial rescue plan, the Dow Jones industrial average plunged 382 points. And Geithner’s subsequent efforts as a center-stage spokesman were less than resounding successes.
On Monday, the administration took a different approach. Geithner largely confined himself to conducting a pen-and-pad-only news conference that excluded TV and effectively reduced the secretary from point man to staff briefer. The Dow soared nearly 500 points.
Wall Street clearly liked the meaty details he laid out. But beyond the substance of the rescue plan, the administration’s shift to a lower profile for Geithner reflected a worrisome fact: Aside from President Obama, the administration has yet to find a commanding figure who can carry economic policy messages and inspire confidence in White House prescriptions.
In assembling his economic team, the president gave first priority to technical skill and intellectual achievement. So far, none of his senior advisors has shown the extra ability to inspire as well -- both on Wall Street and Main Street.
Because the programs are complex, costly and politically unpopular, the dearth of administration officials who can dominate the stage is becoming a serious handicap.
“They’re not good. They can’t talk to normal people,” said Ross Eisenbrey of the liberal Economic Policy Institute. “They’re not reassuring the public. And the psychology of consumer confidence is very important.”
Chief White House economic advisor Lawrence H. Summers, a Harvard economist and former Treasury secretary, is widely admired for his grasp of global economics. Former UC Berkeley economist Christina Romer is a top expert on the Great Depression.
And Geithner headed the Federal Reserve Bank of New York after holding high-level government jobs involving the economy and finance.
Yet all have stumbled in recent public appearances on the economy.
“The ability to communicate with average people was not what these people were chosen for,” said Alice M. Rivlin, budget director under President Clinton. “They were chosen for their understanding of the problem and their ability to think creatively about it and to work out solutions to what is admittedly a very complex issue.”
Selling the president’s economic plans “clearly has not been their forte,” she said.
The Treasury Department’s communications problems have been aggravated by the administration’s delay in filling senior positions under Geithner, partly because of the increasingly stringent vetting rules. But Neal Wolin, previously the department’s general counsel, was nominated Monday for deputy Treasury secretary, potentially easing the load Geithner has been carrying and adding another voice for the administration.
At the same time, Lael Brainard was named the department’s top official for international affairs, and Stuart Levey will remain as its top counter-terrorism official, the administration said. The appointments would round out three of the top four positions at Treasury.
In the face of a communications vacuum, the Obama administration has come to rely on the president as its principal economic spokesman. Obama is turning up everywhere. Last week, he talked about the AIG bonus scandal on “The Tonight Show With Jay Leno” in between quips about the search for a family dog.
On Sunday the president was on TV again, discussing the financial system with Steve Kroft of CBS’ “60 Minutes.” And Obama is to give a prime time news conference tonight in which the economy is certain to be a central focus.
Treasury officials declined to comment for this article. The White House did not return calls for comment. But the Treasury Department provided a document containing more than two dozen bulleted items illustrating Geithner’s workload and summarizing his media appearances.
This week, Geithner appears to be limiting his media time to more business-oriented forums, such as his interview Monday with CNBC’s Erin Burnett. He testifies today before a House committee on the AIG bailout, but that appearance will quickly be overshadowed when Obama holds his news conference later in the day.
Experts on the economy credit Obama for being an effective advocate for his policies. He has frequently managed to explain the complex roots of the financial meltdown in everyday terms.
Describing the AIG collapse on the “Tonight Show,” for example, he said: “Then they decided -- some smart person decided -- let’s put a hedge fund on top of the insurance company.”
But economists add that no president can do it alone.
“We can’t rely on the president exclusively,” Rivlin said. “You can’t have the president talk about the economy all the time. He’s got to talk about Afghanistan and other things. You can’t overuse the president.”
In the modern era, the Treasury secretary and top economic advisors must be able to reach multiple audiences at once. Apart from reassurances that bolster the stock market, they must imbue Americans with enough confidence to sustain the economic engine of consumer demand.
Outside the Oval Office, the administration is still hunting for that voice.
Summers sounded off-key when he appeared on a Sunday talk show March 15 and talked about the AIG bonuses, calling them “outrageous,” but also seeming to suggest he did not believe they could or should be rescinded.
“The nation cannot just abrogate contracts,” he said.
Speaking the next day, Obama struck a different note. The president said he had ordered Geithner to exploit “every single legal avenue to block these bonuses.”
Romer also appeared on a Sunday talk show March 15 and got a question about whether the economy is fundamentally sound.
That may seem like a softball question, but the phrase was politically charged.
During the presidential campaign, Republican nominee John McCain said at a rally in September that the “fundamentals of the economy are strong.” Democrats depicted him as utterly out of touch for making such a claim amid a worsening economic crisis.
Yet Romer’s answer seemed to echo McCain: “Well, of course the fundamentals are sound in the sense that the American workers are sound, we have a good capital stock, we have good technology.”
Now the Obama team is reaching deeper into its bench to find a credible spokesman on the economy.
This week, the administration turned to vice presidential economics advisor Jared Bernstein, who made his first appearance on a Sunday morning talk show since the inauguration.
Bernstein’s appearance may also have been aimed at assuaging Obama’s liberal base.
As a Wall Street insider, Geithner has drawn criticism from progressives. Bernstein, for his part, is on leave from the labor-backed Economic Policy Institute. In his TV appearance, Bernstein stressed how Obama’s agenda could help ordinary Americans.
“Let us not lose sight of the people who . . . haven’t come into this conversation yet -- middle-class folks who are facing an 8% unemployment rate, African Americans facing a 13% unemployment rate, over 20 million people underemployed right now,” Bernstein said.
Earlier this month, Federal Reserve Chairman Ben S. Bernanke defended the bailout of the financial sector in an appearance on “60 Minutes” -- the first Fed chief to take part in a televised interview since 1987.
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peter.wallsten@latimes.com
