Washington Deadlock: Obama Speech v. Paulson Presentation | HughHewitt.com | 09.19.13

If you want to see why Washington has been in such deadlock since the GOP took over Congress, look no farther than two talks of this past Monday.

The first was President Obama’s speech on the economy, delivered in the noon hour within the White House complex.  Many commentators described it as “unhelpful” and that it surely was.  The president never misses an opportunity to poison the atmosphere in this city.

Particularly on that day.  As he spoke, the Washington Navy Yard was locked down. It appears now that the shooter who took 12 lives that morning was not a terrorist.  He was an ordinary man who had tipped into murderous insanity after months of struggle against voices that spoke to him from the walls and floors wherever he went.  But this was not known when the president took to the podium.  Police were still in search of accomplices, though to number, according to media reports, between one and three – in other words, there was still substantial reason to believe that a major command center of the U.S. Navy was under terrorist assault.

Any presidential discussion of domestic issues, particularly invoking politics, would have been inappropriate.  If he felt he had to discuss domestic issues, the president should have talked in a way that acknowledged the good faith of both political parties.  Even if he didn’t believe that both parties were acting in good faith, he should have said they were.  And he should not have come off as partisan.

At a much less challenging moment at the same time in his presidency, Ronald Reagan also took on Congress over the budget.  But even as he knocked Congress generically, he spoke not in partisan terms but against “spenders” and “tax increasers” and included humor.  In one of the most famous lines of his presidency, he said, finishing with the echo of a Clint Eastwood moment, “I have my veto pen drawn and ready for any tax increase that Congress might even think of sending up. And I have only one thing to say to the tax increasers. Go ahead–make my day.”

Mr. Obama’s equivalent to Reagan’s good-natured prodding began with, “The problem at the moment, Republicans in Congress don’t seem to be focused on how to grow the economy and grow the middle class.  I say ‘at the moment’ because I’m still hoping that a light bulb goes off here.”

It is hard to imagine how the president could have a remark more calculated to enrage the Congressional GOP, not even acknowledging their commitment to economic growth and the welfare of middle income Americans and attacking them in the most directly partisan terms.

Reagan’s remarks stopped a move to boost taxes in its tracks.  Within a year and a half, he had engineered bipartisan passage of tax reform legislation that lowered personal income tax rates to the lowest level of the post-World War II era, even while giving Democrats provisions they needed.  After Mr. Obama’s speech, it is difficult to imagine that kind of outcome now, if the White House even wants one.

I mentioned that there was another event that provided a sharp contrast to the president’s on Monday.  It took place a half block from the White House Complex at the offices of the Council on Foreign Relations and was also during lunchtime.

There, former Secretary of Treasury Henry M. Paulson, Jr., and former Congressman Barney Frank spoke about the global financial crisis of 2008-9.  Many conservatives are critical – highly critical – of Paulson’s tenure at Treasury.  I have a different view.  The seizing of up of the derivative market in the spring of 2008 following the Bear Sterns crisis and the further freezing of markets following the collapse of Lehman Brothers that September had, I believe, created a crisis of monetary aggregates.  By injecting base money into the banking system, the actions of the Federal Reserve and Paulson’s TARP program enabled the American and global financial structures to survive until the markets free up again. Drawing on the writings of Milton Friedman, I predicted at the time (http://bit.ly/16qwQLa <http://bit.ly/16qwQLa> ) that, thanks to those actions, we would come out the crisis in short order, so long as, I warned, the Obama administration abandoned its grandiose and misguided plans. They didn’t. We didn’t.

But here’s the point.  It was clear from the Paulson-Frank discussion that the George W. Bush Administration worked hard and effectively to win the support of Congress, both Republicans and Democrats, exactly the opposite approach of the current never-miss-a-chance-to be-petty crowd.

Why is Washington not working now?  That difference tells why.