<br><h3> Chapter One </h3> September 17, 2010<BR> President Barack Obama dances lightly down the four <BR> marble steps to the Rose Garden and across the flagstones to a waiting<BR> lectern. He still glides, elegant and purposeful, in that tall man’s <BR> short-step—a ballplayer returning to the court after a time out.<BR> Today, September 17, 2010, he has committed to putting some “points <BR> on the board,” in the sports parlance of Rahm Emanuel, his chief of <BR> staff. The president needs to show the country that he hasn’t lost his <BR> game, the ineffable confidence, the surety of stance and delivery that <BR> propelled a man with little political experience to scale cosmic heights <BR> and to realize what felt, on Election Day, like democracy’s version of the <BR> moon landing.<BR> Through recent history, America has considered itself something of a <BR> providential miracle, a country that kept finding reasons to believe in its <BR> Manifest Destiny. That faith, sorely tested over the past several decades, <BR> found itself restored with dizzying ebullience when Barack Obama and <BR> his beautiful family stepped onto the stage in Chicago’s Grant Park as <BR> America’s First Family. It was a sensation of such intensity as to startle<BR> many across the country and around the world into believing in the <BR> promise of America, the original and long-burning beacon of the democratic<BR> ideal.<BR> The legacy of that moment is ever more found in the lengthening <BR> shadow it casts. In the nearly two years since, Barack Obama, like an <BR> archangel returned to earth, has been forced to walk the flat land and <BR> feel its hard contours. What, if anything, it has awakened in him remains <BR> unclear—at present, he is clearly struggling to get his bearings. And yet <BR> it is impossible to see the president and not search out signs of that man <BR> from Grant Park, who strode so boldly across history’s confetti-strewn <BR> stage.<BR> On this warm late-summer afternoon, with Congress out of session, <BR> Obama has convened the press to announce the launch of a new agency, <BR> the Consumer Financial Protection Bureau. It has been designed to <BR> protect American consumers from the predations of the financial ser,vices <BR> and banking industry, which over the past ,couple <BR> of decades has grown <BR> vast and insatiable by inventing, for the most part, new ways to market, <BR> sell, and invest in debt.<BR> The woman standing awkwardly at Obama’s left hip, Harvard Law <BR> School professor Elizabeth Warren, has become the nation’s town crier <BR> on the subject of bankruptcy and debt. In the two years since the <BR> economic crisis, she has emerged from nowhere to trumpet the story of how <BR> debt was turned into a velvety weapon, how engorged financial firms<BR> deceptively packaged it, sold it as securities, and extracted usurious profits <BR> from American consumers, especially those in America’s once-vaunted <BR> middle class. The notion of a consumer financial product agency, a <BR> freestanding, independently funded entity like the Federal Communications <BR> Commission, was originally hers, unveiled in an article she published <BR> in the spring of 2007. The truth is that no one much cared for the idea, <BR> until her unheeded concerns turned up at the center of the worst financial <BR> meltdown since the Great Depression.<BR> So today is a long-delayed victory for Warren—almost. Somehow <BR> nothing in the Rose Garden is quite as it seems. The president praises <BR> Warren, whom he says he met at Harvard Law School, as though they <BR> are old friends. They’re not, and Warren only became a professor at <BR> Harvard Law the year after Obama graduated from it. In fact, over the past <BR> two years, while Warren has seen herself lionized on magazine covers <BR> and in prime-time interviews as a leading voice for tough, restorative <BR> reforms, the president seems to have been studiously avoiding her. Part of <BR> the problem, clearly, is that she has been acting the way ,people <BR> expected <BR> and hoped that man from Grant Park would.<BR> This has caused discomfort not only for the president, but also for <BR> his top lieutenants, including the boyish man in the too-long jacket at <BR> Obama’s right hip, bunched cuffs around his shoes, looking more than <BR> anything like a teenager who just grabbed a suit out of his dad’s closet. <BR> That’s Treasury secretary Tim Geithner, looking sheepish. Only those <BR> in his inner circle at Treasury, though, can precisely read what’s behind <BR> that expression: a string of private efforts across the past year to neutralize<BR> Warren. The previous fall, Geithner huddled with top aides to develop<BR> what one called an “Elizabeth Warren strategy,” a plan to engage <BR> with the firebrand reformer that would render her politically inert. He <BR> never worked out a viable strategy—a way to meet with Warren without <BR> drawing undesirable comparisons—and so, like the president, he didn’t.<BR> What the Treasury Department did do, unbeknownst to Warren, was <BR> embrace demands from the banking industry to create a bureau under the <BR> condition that Warren would not be allowed to lead it. But as the financial<BR> reform bill moved to a vote in early summer, industry lobbyists were <BR> so aggrieved at the idea of an agency—they felt it unsupportable under <BR> any conditions—that they didn’t bother to call in their chits on Warren.<BR> In fact, they played it just so. The industry managed to get the <BR> proposed agency shrunk into a bureau that would live under the auspices of <BR> the Federal Reserve, the government’s greatest mixed metaphor of public <BR> purpose and private self-regard, representing as it does the dual interests <BR> of a sound monetary policy and the health of the banking industry. <BR> Beyond that, the bureau’s rules can be vetoed by a two-thirds majority of <BR> a panel of other financial regulators—an indignity of institutionalized <BR> second-guessing known to few other agencies.<BR> But after financial regulatory reform legislation passed in July, the <BR> prospect of Warren at the bureau’s helm quickly grew into a movement: <BR> complete with Internet write-in campaigns, online petitions, flurries of <BR> editorials, and even a viral rap video—certainly a first in the history of <BR> appointing government regulators.<BR> Warren would seem the easiest of choices. Since his earliest days on <BR> the campaign trail, Obama had spoken passionately about restoring <BR> competent government, and with it competent regulators. With the midterm <BR> elections less than two months away, he could have used a confirmation <BR> battle over Warren to draw a much-needed distinction between his <BR> administration and those, mostly Republicans, who dared to side publicly <BR> with America’s big banks and financial firms. Warren’s celebrated ferocity<BR> looked tailor made to revive Obama’s vast grassroots campaign network.<BR> Like an encamped army with nothing to do, the foot soldiers of the <BR> campaign had fought among themselves a bit, eaten the leftover rations, <BR> and then drifted back to private life. Field commanders still in touch <BR> with the White House signaled by midsummer that a Warren confirmation<BR> battle would rally the troops and, according to one, “at least show <BR> what we stand for.” On the other side was the financial ser,vices <BR> industry, <BR> which hurled nonspecific attacks at Warren, claiming she was arrogant, <BR> disrespectful, and power-hungry. It had begun castigating Obama as <BR> “anti-business,” a charge the industry asserts would be definitively <BR> confirmed by the appointment of Warren.<BR> In mid-August, Warren was finally called in to meet with the President.<BR> Obama began their sit down saying, “This isn’t a job interview.” <BR> It wasn’t. The president had already decided what he was going to do, <BR> in a managerial style that had become his trademark: integrating policy <BR> options and political prognostication into a prepackaged solution—,announced <BR> before the game even started.<BR> Combatants over a Warren nomination will never take the field. Shuffling<BR> papers on the lectern in the Rose Garden, Obama says, with a few <BR> passive locutions, that Warren will be on the search committee to find <BR> someone to run the bureau:<BR> “She was the architect behind the idea for a consumer watchdog, so <BR> it only makes sense that she’d be the, um ...” He stumbles briefly, as <BR> though the text is pulling him off balance... “She should be the <BR> architect working with Secretary of Treasury Geithner in standing up the <BR> agency.” He adds that she’ll be an adviser to both him and Geithner and <BR> “will also play a pivotal role in helping me determine who the best choice <BR> is for director of the bureau.”<BR> That’s basically it. None of the troops are energized, and anyone who <BR> feared the financial debacle might produce a true innovation, a rock star <BR> regulator, is left unruffled.<BR> The press conference ends with reporters shouting as the president <BR> turns to leave. One yells above the rest, “Why didn’t you put her up for <BR> confirmation?”<BR> A moment later the president walks from the Rose Garden to the basement<BR> of the White House. Having finished with Geithner and Warren, <BR> he strolls unaccompanied, free of handlers and Secret Ser,vice,<BR> through a <BR> long subterranean hall on his way to the Situation Room.<BR> “Hey, Alan, how you doing?” he pipes up, spotting Assistant <BR> Secretary of the Treasury for Economic Affairs Alan Krueger coming the <BR> other way. Krueger carries an additional title, held over from the nineteenth<BR> century: chief economist of the United States.<BR> “Just fine, Mr. President,” a somewhat surprised Krueger responds. <BR> “In fact, today’s my birthday.”<BR> The two men stop to chat for a moment at the entrance to the White <BR> House mess. The president has grown to appreciate Krueger’s input over <BR> the past eighteen months. A Prince,ton <BR> professor and frequent stand-in <BR> for Geithner at Obama’s morning economic briefing, Krueger is something<BR> of an oddity in the upper reaches of government: he’s an actual <BR> researcher. Typically, high-ranking economists do their substantive, <BR> elbows-deep research in the earlier stages of their careers. Not Krueger. <BR> Not only had he been publishing groundbreaking studies up until joining <BR> the administration in January 2009, but he had also gone so far as to <BR> commission targeted research over the past year, using Prince,ton <BR> funds and <BR> resources when he found the government’s research apparatus too slow.<BR> The current economic crisis, he felt, was too thorny and too unusual <BR> not to study with fresh eyes and first questions. Characterized by both <BR> rock-bottom interest rates and a catastrophic de-leveraging spiral, the <BR> crisis defied most historical precedents from which actionable policies <BR> might be drawn. And the White House needed nothing so much as a <BR> stream of creative remedies, one right after the next.<BR> The administration undershot the crisis, convincing itself by the <BR> summer of 2009 that the economy had turned the corner and, at the <BR> same time, recognizing that it would be a jobless recovery of stunning <BR> disparities, with restored GDP growth alongside fast rising unemployment.<BR> In fact, internal administration projections in June 2009, when <BR> unemployment was at 8 percent, noted that joblessness would average <BR> a whopping 9.8 percent in 2010. Krueger and others began to work <BR> furiously to find innovative ways that the government might stimulate <BR> job growth. Being a close friend of both National Economic Council <BR> chairman Larry Summers, who was his graduate adviser at Harvard, <BR> and Office of Management and Budget director Peter Orszag, whom he <BR> mentored at Prince,ton,<BR> made Krueger one of the few ,people <BR> to whom <BR> both of Obama’s top economic advisers deferred. All to no avail. <BR> After the stimulus bill was passed in February 2009, little else happened <BR> on the jobs front for a year and a half. Proposals were talked to death <BR> without resolution; the few that were adopted tended to lack a coherent <BR> political strategy to make them legislative reality. The day before, the <BR> Census Bureau had announced that poverty had hit a fifteen-year high. <BR> Even the Wall Street Journal’s editorial page had bemoaned that middle<BR> class incomes dropped a stunning 5 percent between 2001 and 2009, a <BR> lost decade laying claim to the country’s worst economic performance <BR> in half a century. Unemployment stood at precisely the 9.8 percent the <BR> administration’s prognosticators had foretold.<BR> Obama, who was at the center of this dispiriting process, tried to keep <BR> things light and breezy in the hallway with Krueger. He seemed improbably<BR> ebullient, wanting to talk.<BR> “So, how old?”<BR> “A little older than you,” Krueger says. “Just turned fifty.”<BR> Obama steps back, appraisingly.<BR> “Fifty? You’re looking pretty good for fifty.”<BR> He means it. Krueger notices for the first time that the president, a <BR> year his junior, has really aged in office, bits of gray hair now sprinkling <BR> his crown, wrinkles growing around his eyes. Krueger is about to say, <BR> “Well, my job’s easier than yours,” but he catches himself and instead <BR> goes with “You should see me on the basketball court.” Maybe this will <BR> win him an invitation to one of Obama’s famous five-on-fives.<BR> None forthcoming, and Obama closes it out. “So what are you doing <BR> for your birthday?”<BR> “Going back to Prince,ton,”<BR> Krueger says. He’s a breath away from adding: soon for good.<BR> He’s through with D.C. He has decided to return home a day after <BR> the midterms, exhausted for sure, but more than that, tamping down the <BR> sense of missed opportunity. As the two men part, he can’t help but wonder<BR> if Obama feels the same way. How could he not?<BR> Waiting in the Oval Office are Jann Wenner, the founder of Rolling Stone <BR> magazine, and his executive editor, Eric Bates. They have been there for <BR> an hour, since just before the Elizabeth Warren event, waiting and <BR> preparing for an interview with the president. Rolling Stone, failing to score <BR> an Obama interview since the campaign, has nonetheless gone through a <BR> renaissance in the past two years, dealing some of the most forceful <BR> criticisms of Wall Street and Washington and the collusion between the two, <BR> with targeted shots directed at both Goldman Sachs and Obama himself.<BR> So, for the president, today is all about forcefully answering the charge <BR> from the progressive community—and a great many independents—<BR> that what got him elected has not been evident in his governance. The <BR> administration’s strategy is to emphasize that the distance between the <BR> hopes of Grant Park and the trimmed ambitions of legislative pragmatism<BR> is not a fissure, rupture, or acquiescence, but rather the hard reality <BR> of governing in a partisan era. All the better for those words to appear in <BR> an organ of criticism, which is why Rolling Stone was chosen. <BR> Obama enters his famous office and compliments Wenner, the stylish, <BR> aging hipster, on his colorful socks: “If I wasn’t president, I could wear <BR> socks like that.” Then he settles himself into a wing chair between marble<BR> busts of his heroes, Abraham Lincoln and Martin Luther King, Jr. <BR> Obama is ready to rebut criticisms head-on. But the questions today <BR> do not pose much of a challenge, beginning with standard fare about <BR> the state of the economy he inherited and Republican obstinacy that, <BR> the president notes, reared up a day before his inauguration even, when <BR> he learned that the Republican Caucus would vote as a bloc against the <BR> stimulus package...<BR> <p> <p> <i>(Continues...)</i> <p> <!-- copyright notice --> <br></pre> <blockquote><hr noshade size='1'><font size='-2'> Excerpted from <b>Confidence Men</b> by <b>Ron Suskind</b> Copyright © 2011 by Ron Suskind. Excerpted by permission of HarperCollins. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.<br>Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.