Book Reviews

The Technocratic Mind

A hagiography of the Obama administration's most powerful wonks reveals more than it intends.

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The Escape Artists: How Obama's Team Fumbled the Recovery, by Noam Scheiber, Simon & Schuster, 368 pages, $28

In Washington, it is well understood that policy is politics. Changing the world, or even just the law, is not a revolution; it is a slow and painful process of negotiation and compromise. No plan, no matter how perfect its architects imagine it to be, escapes Congress unscathed; no reform ever emerges clean and pure. Interest groups will demand and extract concessions. Constituents must be appeased. Coalitions must remain intact. Appearances must be preserved. Inevitably, the legislative process takes its toll. 

But it is easy to forget that policy is also personality. It is convenient to speak of any presidential administration as a single entity with a single purpose. The truth is far more complex. And because the federal government concentrates a relatively large amount of power in the hands of a relatively small number of people, the particular interests and predilections of those individuals can have an outsized impact on the nation's priorities and how they are implemented. 

In The Escape Artists: How Obama's Team Fumbled the Recovery, Noam Scheiber, a senior editor at the venerable liberal journal The New Republic, presents a reminder that the senior officials who drive the policymaking process are also people with unique and often clashing personalities. But there is one trait that connects them all: an unshakable belief that there is no economic problem, large or small, they cannot solve through technocratic meddling. 

Scheiber's overview of the Obama years focuses on economic policy: the crash, the stimulus, the fights over health care reform and financial regulation, and the ongoing battles over debt and deficit reduction. These policy issues are relayed largely as debates among a cast that consists primarily of Obama's top economic advisers, the big swinging wonks of Washington. In crisp prose, Scheiber sketches their motives, backgrounds, and habits of mind. This book is about what makes them tick—and, implicitly, what makes the economy tick. 

The major players are all professional Democrats and liberals of one stripe or another. Scheiber's detailed, thoroughly reported account describes their efforts at responding to the faltering economy while pursuing the rest of Obama's ambitious agenda. In the process, Scheiber takes as a given his protagonists' centrality to the success or failure of the economy. 

It is an assumption that his subjects share. Their endless infighting and many personal differences are what drive the book and furnish its occasional bursts of dramatic urgency. But they are united in a conviction that the system is broken—and that only they know how to fix it. 

That (over)confidence comes from the top, with President Barack Obama setting the tone. From the outset, Obama viewed himself as a post-partisan problem solver, a man whose ultimate allegiance was to pragmatism rather than party politics. As Scheiber tells it, while in the Senate, Obama "preferred to operate as a party of one." 

But Obama was not exactly a man without a team. He was loyal to the cult of policy smarts. He may have even been its high priest. As Scheiber reports, outside analysts reporting to the president were advised to highlight their expert credentials so he would know he wasn't talking to cranks and dummies. Obama also wanted his inner circle to credit his own abilities: The president, Scheiber writes, "craved intellectual affirmation" and often badgered his lieutenants into acknowledging when his own ideas were perceived to have succeeded. Obama "had a habit of prompting his aides to acknowledge his wisdom and foresight," Scheiber writes. The president would sometimes wonder aloud, "Whose idea was that?" when he deserved credit.

Obama's world-historic political ambitions crossbred with his intellectual pretensions, and what emerged was a man who saw himself as a technocratic national savior. He would lose interest in his advisers' proposals, according to Scheiber, if they did not sound sufficiently visionary. Told early on by a top adviser that his chief accomplishment as president would be preventing another Great Depression, Obama reportedly replied, "That's not enough for me." 

Scheiber seems to believe this response reflects Obama's unusual determination, but he does not downplay the president's outsized self-perception or his unrelenting certainty. "There was a strain of messianism in Barack Obama," Scheiber writes, "a determination to change the course of history."

Every messiah needs disciples. Obama's economic team included a hometown favorite, University of Chicago economist Austan Goolsbee, and a Washington rookie, Berkeley economist Christina Romer. But for the most part, he formed his economic team from the ashes of the most recent Democratic administration, packing it with associates and protégés of Bill Clinton's treasury secretary, Robert Rubin. Chief among these were Harvard economist Lawrence Summers, who became the director of the President's National Economic Council, and Timothy Geithner, a pedigreed finance bureaucrat who was installed as treasury secretary. Acting as a political filter on the policy team's recommendations was Chief of Staff Rahm Emanuel, a brash Democratic fixer recruited from the ranks of House leaders. 

These disciples all shared the president's technocratic vision. But unlike the president, they were responsible for figuring out the practical details of how it would get done. How big would the stimulus be? How would the banks be bailed out, and what sort of losses would their shareholders take? Would there be any relief for underwater homeowners, and if so how much? Would deficits be prioritized? What would the president do about entitlement reform? To what extent would an overhaul of the health care system displace an emphasis on jobs and economic growth? Scheiber dissects the White House's internal conflicts on these and other issues, keeping a close eye on the play-by-play of who supported what plan and why. Each of the participants gets a moment in the spotlight, a canned back story, and a handful of revealing anecdotes.

Sometimes the arguments hinge on wonky debates about the merits and effectiveness of some particular policy. But often they are driven by personality conflicts and petty squabbles. Scheiber portrays the Obama team as more cliquish than a middle school, fraught with seating-chart slights and tennis-camp snubs, where policy is frequently determined by meaningless personal byplay. When the stimulus package is being put together, Rahm Emanuel's brother, Ezekiel, who worked as a White House health care adviser, sees an early list of spending options and expresses dismay that it lacks a wow factor; he laments that there's nothing as exciting as, say, a bullet train between New York and Washington, D.C. None of the economists on the team thinks such trains make effective stimulus, but when the bill passes, it includes $8 billion in funding for high-speed rail. Obama, meanwhile, is reported to have pushed Christina Romer to check and recheck numbers on potential jobs from clean energy, despite being repeatedly informed that public subsidies for the sector would produce minimal employment gains. The numbers side with Romer: According to Department of Energy data, $38.6 billion in federally guaranteed green energy loans have produced just 3,545 permanent jobs. 

Yet their own daily experience with the arbitrary and irrational nature of the policymaking process does nothing to convince the assembled experts of their own fallibility. They accept such absurdities as the price of the process. Each of the episodes that Scheiber relates takes a similar shape: An economic problem arises or is identified. The Obama team decides to solve it. Players go back and forth over various mechanisms they believe might address the issues. Something is done, or nothing is done, but few of the problems ever really go away. The stimulus does not lift the economy out of a recession; financial regulation leaves the overall structure of the financial sector essentially the same; millions of homeowners still owe more than their homes are worth. Yet when the next problem appears on the horizon, the debates begin again. 

Scheiber is not uncritical; in particular, he views Summers as a domineering figure whose inability to produce concrete plans and political judgments may have kept Obama from pursuing better policies. But he does not hesitate to lavish praise on the Obama team's commitment to sound policymaking in almost hagiographic terms. Of Obama's first budget director, Peter Orszag, for example, Scheiber writes that he "did transparency, but he didn't do politics. He had no ideology other than the truth." He hails "Geithner's genius as a bureaucratic operator." Even Summers gets a hat tip for being "an altogether more agile thinker than Geithner" who "had a formidable academic career before rising to prominence in government." 

Yet as the book's subtitle makes clear, Scheiber nonetheless believes Obama's team swung and missed on economic policy. How could these experienced and expert Washington superstars have failed? Scheiber tries out several theories. 

He suggests, for example, that the $800 billion stimulus did not fail but was simply too small to get the job done. Despite Romer's belief that a much bigger package was necessary to end the recession, Summers did not present larger options to the president, believing them to be politically infeasible. But the public sticker shock that accompanied the legislation and the haggling over its size in the Senate suggest that it was Summers who judged the political landscape correctly, not Romer.

Scheiber does not believe it was ever possible to compromise with Republicans; he depicts Obama's repeated efforts to do so as a mistake. Although he lavishes Democratic wonks with attentive biographical detail, he paints their Republican opponents in far cruder terms. 

Describing an early 2011 showdown over the GOP's promise to cut $100 billion from the budget, Scheiber writes that House Speaker John Boehner (R-Ohio) "presided over a roster of House members who subscribed to a radically antigovernment ideology." Scheiber portrays the administration as giving in to Republican budget cutting madness by agreeing to a compromise that cut just $38 billion relative to the 2010 appropriations budget. In the context of $4 trillion budgets and $1-trillion-plus deficits, it's hard to see this cut as radical. Furthermore, Scheiber fails to note that after discounting budget gimmicks like cutting reserve fund spending that wasn't actually due to be spent the following year, the deal cut just $14 billion in planned spending and reduced the deficit by just $353 million once roughly equal size increases in defense spending were factored in. 

Meanwhile, Scheiber covers for the Obama team's obvious mistakes. He excuses an early memo authored by Romer and vice presidential economist Jared Bernstein projecting that a $775 billion stimulus plan—roughly the size of the one that was passed—would lower unemployment to less than 8 percent by the end of 2011. The problem, Scheiber says, was that they just didn't understand the depth of the recession. This is rather like excusing a doctor's failure to cure someone's cancer with an experimental protocol by suggesting he did not know how far the disease had progressed: Not only did the treatment fail, but the prognosis was wrong. 

Yet Scheiber barely acknowledges the existence of any legitimate disagreement over the effectiveness of stimulus spending. The book makes much of the Obama team's internal policy debates but essentially ignores external criticisms. Scheiber expertly illustrates the impact of personality and politics on policy but fails to judge most policies on their own merits. 

Like his subjects, Scheiber assumes the issues under discussion require federal policy solutions, as if the health care market, Wall Street, and the economy as a whole could not function without endless tinkering from small bands of super-wonks. He faults the president's men for their mistakes and wonders why they didn't take opportunities to get more done. Yet given the dismal results so far, a better question might be: Haven't they done enough already?

Peter Suderman is a senior editor at reason.

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  1. *barf*

    1. biography of saints?
      what rug glue are you smoking?
      hagiography?
      no, more like something that would appear in the National Inquirer…

  2. I can’t tell which one has the more punchable face.

    1. There’s no need to make a choice, dude. Just punch both.

      1. That’s why God gave you two hands and arms, right?

  3. Alt-text:

    “Dead eyes, dead eyes, are you just like me?”

  4. The president would sometimes wonder aloud, “Whose idea was that?” when he deserved credit.

    With apologies to Barfman,

    *barf*

    1. Owebama/Biden
      ’cause we know better

  5. Wow. What a small, small man Obama is.

  6. The Democratic party is almost entirely taken up with people who either believe that, given the chance, they could formulate a perfect social structure, or that there are such people and they should be supported. The Republicans also have this sickness, but to a slightly lesser (say, not more than 70%) degree.

    No amount of negative experience seems to wake up these messianic twits.

  7. Is it just me or does Obama look really stoned in that picture?

  8. Like his subjects and about 80% of all human beings, Scheiber assumes the issues under discussion require federal policy solutions, as if the health care market, Wall Street, and the economy as a whole could not function without endless tinkering from small bands of super-wonks.

    The existence of the watch implies the existence of the watchmaker. ‘Obamessiah’ is not merely a rhetorical epithet, He worketh all things after the counsel of His own will.

    1. You’ve stumbled on something here.

      Obama = Cyborg Barry.

      1. Let me be clear- we are in the danger zone.

  9. “Scheiber nonetheless believes Obama’s team swung and missed on economic policy.”

    None of that matters now because Obama has taken a historic stance on gay marriage! Historic!

    Besides, economies just get in the way of history.

  10. All these “experts” advocated more government, which would of course increase the demand, to oversee and advise, for more “experts”.
    Gee, more demand, same supply, what happens then? PRICE GOES UP, UP and AWAY.
    Who benefits?
    Not hard.

  11. Biggest problem is that all of the folks in this administration are, to be blunt, incompetent. Second largest problem is that 150+ years of crony capitalism – which requires losers and winners picked by politicians – has no potential losers left other than the supports, friends and family of the existing large corporations. The smaller ones are taken care of at the state and local levels, but the problem remains: no one left to screw for the good ole boys’ benefit who isn’t already one of the good ole boys. So, of course they’re all hunkered down, waiting for the other shoe to fall.

    1. Ike|5.9.12 @ 9:37PM|#
      “Biggest problem is that all of the folks in this administration are, to be blunt, incompetent.”

      Disagreed. The problem isn’t competence. It’s the belief that competent people in those positions can manipulate circumstances to achieve success.
      We don’t need better Top Men; we need those who understand the limits of what a government can do.

      1. I think a better start would be those who understand the limits regarding what the US government is constitutionally ALLOWED to do.

        1. Are you serious? Are you serious?

          1. I, for one, would love to see a federal government that limited itself to matters involving its constitutional powers and authority. I also think it would be nice if people would all get along, and women chose boyfriends by character instead of looks and wallet size.

            I expect all three desires to be fulfilled at about the same time.

            1. Hey, at least when Hell freezes over, it’ll be a nice temp change for me.

      2. But that bespeaks a certain kind of incompetence.

  12. “Like his subjects, Scheiber assumes the issues under discussion require federal policy solutions, as if the health care market, Wall Street, and the economy as a whole could not function without endless tinkering from small bands of super-wonks.”

    Fish: “Water? What is that?”

  13. keeping a close eye on the play-by-play of who supported what plan and why. http://www.nikewinkel.com/scho…..-c-83.html Each of the participants gets a moment in the spotlight, a canned back story, and a handful of revealing anecdotes.

  14. keeping a close eye on the play-by-play of who supported what plan and why. http://www.nikewinkel.com/scho…..-c-83.html Each of the participants gets a moment in the spotlight, a canned back story, and a handful of revealing anecdotes.

  15. As a Scott Sumner monetarist, I do not believe that fiscal policy is important in a cyclical context. What matters is the relationship between money growth and nominal GDP growth. In this view, FOMC caused the recession and the weak recovery by focusing on interest rates rather than on output. Although Bernanke is also a monetarist, he is also a leader by consensus. The FOMC hawks have prevented him from doing his job. Obama has nothing to do with it. You can have strong growth under a leftist president as history shows (1933-36, 1963-68, 1993-99). Obama is bankrupting the treasury, but he is not responsible for the bad economy.

    1. He completely supports populist policies, it is pretty obvious from his rhetoric.

  16. The author clearly does not believe in Keynesian economics. His bias affects his analysis.

    Looking backwards, we have not emerged from a deep recession since WW II without Keynesian fiscal stimulus. One of the best examples is the early 1980’s when we set post WW II records for spending as a % of GDP in FY’s 1981, 1982 and 1983, not stopping until all of the 2.7 million lost private sector jobs had been recovered. In practice, Reagan was a Keynesian.

    By contrast, after inheriting record setting spending in Bush’s last budget (FY 2009), we actually CUT SPENDING in FY 2010. Not just in real dollars or as a % of GDP. We cut spending in nominal dollars for the first time since FY 1965. The result was the fizzle of the recovery summer of 2010.

    The author states “The stimulus does not lift the economy out of a recession.” This is consistent with the 76-83% of American voters who mistakenly think that we are still in a recession. They and the author are WRONG. We exited the recession in June 2009, five months after President Obama took office. Most observers credit TARP and the passage of the ARRA stimulus with helping to turn around the economy and get us out of the recession. GDP has been growing for almost three (3) years.

    I agree that high speed rail and green energy should not have been included in the stimulus. I wish the Obama team had done a better job of keeping these liberal political ornaments out of ARRA.

    1. Looking backwards, we have not emerged from a deep recession since WW II without Keynesian fiscal stimulus.

      Right. Which is exactly why America experienced prosperity during the gigantic stimulus known as WW2.

      Rations = cure for recession!

      Oh wait.

      1. Deficit spending during WW II to purchase tanks and planes = Jobs = Cure for recession

        1. Yet somehow the depression didn’t end until all that spending ended. Go figure.

      2. Hah,

        God I hare Keynesians, it is completely schizo. It violates all the fundamental things we learn about the long-run supply and demand curves.

        1. *God I dislike

          😉

  17. It would be nice for once any of these articles on the economy actually addressed the facts about what the President has had to deal with.

    This recession has produced a gross job loss of nearly 8,000,000. That is more than the prior five recessions dating back to 1980 combined.

    Furthermore we’ve lost nearly 700,000 public-sector jobs. this is the first time that a recession has lost public sector jobs.

    In fact the post-9/11 recession sostenuto’s program that kept 900,000 public sector employees at their jobs teaching etc.

    This one item alone is worth a full percentage point in the employment rate.

    Getting 4.2M private-sector jobs back and back to where we were when you took office in just three years is a pretty monumental achievement.

    Especially notable when the average number of new home starts the last few years as 500Kand 2005 was 1.6 million. Similar recessions of the 80s also saw housing starts before recession a 1.6 – 1.7M range and they only dipped 2-300K during those recessions.

    This gap alone has taken over $650B per year over the last 3-4 yrs out of GDP.So nearly $3T of GDP IN the jobs that new housing et al supported are not there because of the housing collapse.

    You can try calling the president all the names you want, failure etc. but in reality he’s had more on his plate than any of his immediate predecessors had to deal with and dealt with it better than one could’ve expected especially with the lack of cooperation from the Republicans.

    1. Way to miss the point, Trollname.
      Libertarians don’t fault Obama for not being able to “fix” the economy; they think the idea of a president fixing the economy is patently silly, and that this is borne out by history time and time again. All the meddling you so desire was never going to work. These clowns you support said they were going to “fix” the economy; nevermind that it does not work. Then, when it so miserably failed, you buy their lies that the plan was good, the problem was just so much worse than they anticipated! That is called a non-falsifiable hypothesis, perfect for politicians!

      1. That’s not it, Keynesians also have populist tendencies, giving welfare has nothing to do with tinkering the economy. It is just something politicians defend in order to get elected, yet those programs are unsustainable.

  18. Their mistake is the assumption that humans in groups can make wise or moral choices. We can’t. Or we won’t. But in either case, we don’t.

  19. millions of homeowners still owe more than their homes are worth. Petten Ed hardy Yet when the next problem appears on the horizon, the debates begin again.

  20. regulation leaves the overall structure of the financial sector http://www.vendreshox.com/nike-shox-tl1-c-12.html essentially the same; millions of homeowners still owe more than their homes are worth. Yet when the next problem appears on the horizon, the debates begin again.

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