Early Report Cards: On Wall Street, Main Street and the White House

"I'm not saying, 'Mr. President, go stare at the Bloomberg quote machine and come to your senses,'" said CNBC's Jim Kramer. "I just want some sign that Obama realizes the market is totally falling apart. And that his agenda has a big hand in that happening."

You have got to respect a president who, in the face of breaking glass and falling skies, nonetheless maintains the conviction to execute his master plan.  Whether it is the right plan is an entirely different matter.

Case in point, I was talking with a friend last night who wanted to get my read on the tri-fecta of stimulus, financial system rescue and the cratering economy. 

Specifically, he wondered if Obama was placing the right dollars on the right priorities and whether in such scary times, we should be spending cycles and dollars trying to re-make education, re-jigger health care and re-engineer the relationship between the federal government and its people.

Therein lies the paradox for Obama & Co.  On the one hand, if not now then when?  His political capital is as high as it may ever get, the dollars are flowing and the present time is tremendously ripe for transformative “creative destruction.” 

In other words, this might be a once in a lifetime opportunity.

The counter is that screw this up, and we end up with an agenda that (as David Brooks puts it) is unexceptional in its parts but that, when taken as a whole, represents a social-engineering experiment that is entirely new – and not necessarily in a good way.

This fork can be seen in the indigestion between Wall Street and Main Street, zero sum battles between Republicans and Democrats (and by inference, conservatives/liberals), and perhaps soon, populists versus centrists/moderates (see upcoming battles in: taxation, immigration, protectionism, gun rights, auto industry bailouts, supreme court judge nominations, etc.).

In a very provocative, but compelling, NYT op-ed, ‘A Moderate Manifesto,’ David Brooks assails the Obama budget (and his governance instincts), saying:

Those of us who consider ourselves moderates — moderate-conservative, in my case — are forced to confront the reality that Barack Obama is not who we thought he was. His words are responsible; his character is inspiring. But his actions betray a transformational liberalism that should put every centrist on notice. As Clive Crook, an Obama admirer, wrote in The Financial Times, the Obama budget “contains no trace of compromise. It makes no gesture, however small, however costless to its larger agenda, of a bipartisan approach to the great questions it addresses. It is a liberal’s dream of a new New Deal.”

Moderates now find themselves betwixt and between. On the left, there is a president who appears to be, as Crook says, “a conviction politician, a bold progressive liberal.” On the right, there are the Rush Limbaugh brigades. The only thing more scary than Obama’s experiment is the thought that it might fail and the political power will swing over to a Republican Party that is currently unfit to wield it.

Read the whole article HERE, because beyond the immediate financial crisis, which will pass, it gets to the nut of what we the people are signing up for; namely a New Deal or a variation of the Same Old Deal (i.e., party and power politics, division over unity).

Now, more than ever, details and nuance matter.

Related Posts:

1. Getting Real: On Doomsday, the Demise of So-Called Experts and the New Arbitrage
2. Engine Failure: When Financial Markets Fail (a good primer on the crisis)
3. Warren Buffett for Recovery Czar: Why we need the Wizard of Omaha to step up