Free Markets, Free People

Edward Liddy


Community Organizing From the White House (Budget and AIG)

Once a community organizer, always a community organizer, I suppose – from an email I received recently from the Obama campaign email list:

The current debate in Washington over President Obama’s budget has made one thing clear — ensuring our long-term prosperity won’t come without a fight.

Partisan voices and special interests are showing real resistance to President Obama’s call for making the necessary reforms and investments in energy, health care, and education. That’s why we need to bring the conversation back into homes and communities across America.

Last week, thousands of you pledged your support for the President’s economic plan and encouraged your friends and family to join you in a national display of support. Now I need you to take the next step.

This weekend, supporters like you are organizing Pledge Project Canvasses to talk to people in their communities about this plan and mobilize support in neighborhoods across the country.

The eternal campaign continues with attempts to solicit the same ground support “magic” the campaign was able to solicit during the presidential campaign. However, doing that during a campaign when the focus is a person and his promises vs. attempting to do that when the person in question has gained the office and is now talking about concrete proposals which may or may not be in the best interest of the country isn’t quite as easy.

A couple of thoughts on this sort of an attempt. One – the tie that binds (getting Barack Obama elected) doesn’t necessarily extend to things like the budget or other specific issues. So the group that accomplished the former aren’t necessarily unified on the latter. That tends to promise lower turn out in the community events or, if they show up, some discord.

Two – the assumption is these events will demonstrate the will of the people and put pressure on Congress to act as Obama asks them to act, i.e. pass his budget. But there’s no direct linkage with this sort of activity and Congress like there was during the campaign when this sort of activity could be converted to votes. The Obama campaign used to brag about the “house parties” that were held at a grass-roots level demonstrating the power of his campaign and the promise of the votes to come. None of that translates into the same sort of power when aimed at Congress.

Three – it again demonstrates that the administration still hasn’t managed to get itself out of the campaign mode. Another example of that has been the AIG bonus debacle. Treasury Secretary Timothy Geithner and AIG CEO Edward Liddy discussed the bonuses on the 11th of March. Liddy sent Geithner a letter on the 14th explaining the reason for them and the possible impact of not paying them (explained in the AIGFP Employee Retention Plan). It’s not about “retaining the best and brightest”. In fact, it is a calculated method of hedging their risk and ensuring the tax payer doesn’t end up on the hook for even more billions in bailouts.

Instead of calmly explaining this in a joint press conference with AIG, Geithner and the administration chose to fan the flames of outrage and use it for political gain.  That isn’t leadership, that’s politics.  And it is also an administration in the campaign mode.  That’s a dangerous mode to be in, especially at this time and place.  When given the opportunity to have a frank and tough discussion with the public about bonuses it knew were going to be paid and explaining their necessity, the Obama administration reverted to the populist campaign mode of demonizing AIG instead of calming the emotions and fears of the public.  

~McQ