The Book Rattling the White House—Why It Matters
Business + Economy

The Book Rattling the White House—Why It Matters

TFT / Getty Images

Pulitzer-prize winning author Ron Suskind admits he’s “a little surprised” by the fierce attacks the White House has leveled against his carefully sourced book on the Obama presidency, Confidence Men: Wall Street, Washington, and the Education of a President.  To write his account of Obama’s first two years in office, Suskind talked with more than 200 power brokers both inside and outside the White House, including the president himself, who gave Suskind a 50-minute interview on February 14, 2011.

Even before the book’s release, current and former members of the administration have been denying quotes, citing misspellings as signs of inaccuracy throughout Suskind’s book, and circling the wagons, with guns blazing.

“I suppose I’m surprised at the virulence of it – of their ardor,” Suskind told The Fiscal Times. “But it’s bound to happen when the first revealing and heavily sourced glimpse of what has really been going on in the White House appears. White Houses tend to react in generally predictable ways. They do whatever is possible to kill this off. It’s not part of their message.”

The timing of the book’s release, in this lead-up time to an election year, has contributed to the offensive, admits Suskind, but he says other factors are noteworthy. “When the narrative and the reporting were coming to a close, [the administration] was feeling more confident. The president, Suskind says, had a terrific post mid-term period.

“He was very proud of the tax-cut deal, with the payroll taxes, of creating stimulus. And he had bin Laden in the crosshairs around the time I was interviewing him. So he was feeling like he’d gotten hold of this beast named president. He had this job down. He knew how to do it. He felt more comfortable with the exercise of power, how to make the White House express his will. And he said, ‘Now I have the staff to be a more active president.’”

After the book was finished, came the debt-ceiling debacle. And all of a sudden, says Suskind, “that spring looks like a false spring.” At a time when Obama might have expected to be moving forward with a clear, purposeful agenda to jumpstart the economy, he got derailed.

The Fiscal Times (TFT): How did the discord in the White House that you describe in your book affect the economy?

Ron Suskind (RS): The debates inside the White House that resulted in certain actions couldn’t be more significant in terms of the U.S economy. The prevailing view pushed forward mostly by Larry Summers – who had real dominance of this process, even when people pushed against him, including the president in some cases, - Larry’s view was that nothing was going to work unless there was a change in what he and Christina Romer and others said was deficient aggregate demand. 

There were a lot of deficit hawks in the administration.
The president is, at heart, I think, a deficit hawk.

Other things were considered, but they would cost money. There were a lot of deficit hawks in the administration – the president is, at heart, I think, a deficit hawk, and Peter Orszag as well.

And so the deficit hawks made a case that matched up well with Larry’s case. Larry said, ‘Unless we can change aggregate demand, nothing significant will be marked as forward progress.’ They had fired their bullet, or felt they did, in the  big $800 million stimulus package. That was right off the bat. And after that, well, there’s no more money to do anything dramatic when it comes to aggregate demand. And with the deficit growing, because of the sluggish economy, they ended up in a kind of gridlock. The president went back and forth [with various policy scenarios]. That, I think, is significantly responsible for some of the lack of action. Meanwhile, the Fed was very active, but that’s because they’re not driven by a political process.

Wall Street roared forward and the American economy
sagged, causing all kinds of problems.

TFT: Did some of the gridlock result from the collision between Obama’s soaring hopes of what he could accomplish and the harsher reality of moving policy forward?

RS: Every decision that comes to the White House is going to be a difficult decision. Here’s one where a fundamental structural analysis and action, as well as presentation to the American public, was probably demanded. Instead, there was a feeling of, ‘Let’s hold things together. Let’s support the banks. Let’s help them find their way back to health. And hopefully they’ll pull the economy along with them.’ But that didn’t happen. Aggregate demand didn’t rise. Wall Street roared forward and the American economy sagged, causing all kinds of problems both economic and political.

TFT: Do you think the president has a realistic view of how the economy works?

RS: I think so. I think he – as Paul Volcker says in one of the interviews – he seems to get it. He seems to understand everything. The question is, what then? Can he act decisively when it’s a choice of imperfect options on either side? The president said that some of his faith in the sort of policy wonk’s view was misplaced. He says, ‘I have the policy wonk’s disease, like Clinton and Carter, and I want to get rid of it.’

TFT: Is Obama anti-business?

RS: Definitely not. Has an administration ever done more to support business than this one? Name it. They brought the entire force of the federal government to rescue many American industries, most notably, Wall Street. They’ve done everything they generally can in that way. They’re certainly trying to bring some regulation to an area that created an implosion, because there was no significant regulation.

TFT: Is he trying to redistribute wealth?

RS: No, not at all. No.

TFT: You say it took you some time to “see him as a man.” Why?

RS: I’m an American. I was in Manassas for the last rally, with 100,000 people, a few miles from where the Civil War started. I was in Grant Park. It was an emotional time for Americans, with the crisis rising across the country, the Depression-like tsunami, and Obama arriving. You can’t cease to be moved at places like that, in a moment like that. You just have faith in this man to do what’s needed. And I think, over time, as you get closer to it, it starts to burn off. Some of the parts of this book were actually hard to report.

Well, if you guys can’t decide, I guess we don’t have to
do anything.’

TFT: What parts, specifically?

RS: That very hard moment, where after months and months of debate over a jobs plan, through the fall of 2009 and the winter of 2010, the economic team was bickering away, and he says to them, ‘Well, if you guys can’t decide, I guess we don’t have to do anything.’ He was exhausted from it. He wasn’t getting the thing to work.

TFT: Do you think he’s still exhausted?

RS: I think he’s energized now. I think Obama has something of what you’d call a long-shot personality. He’s at his best when the odds are longest, and I think the odds are lengthening, and it’s bringing out the best in him.

TFT: In the book, you quote Obama as saying that Ronald Reagan ‘was very comfortable playing the role of president.’ Why did he bring that up?

RS: We talked about various presidents. And he mentioned Reagan’s ability to exude confidence when the evidence didn’t support that confidence. And he said almost with a kind of envy, ‘He had a kind of actor’s skill that he could do that.’ Obama doesn’t feel he has that. But he does feel that he has evolved. And I think that right now with the jobs thing yesterday, probably he would chalk that up, if we were talking at this moment, as evidence of how he’s changed.