One might think that after a historic shock to the American economy in the first serious downgrade of our credit rating in decades, an American President would want to speak to a worried nation about the future and his plans to address the situation. Instead of taking an opportunity to demonstrate leadership, Barack Obama instead spent the weekend away from public scrutiny at Camp David. ABC News reports this morning that Obama won’t talk publicly today, either:
President Obama will spend today in closed-door meetings at the White House, no doubt tackling the fallout from Standard & Poor’s decision Friday to downgrade the nation’s credit.
After spending a low-key weekend at Camp David, the only item on the president’s schedule this morning is his daily briefing in the Oval Office.
Well, that’s not entirely true. Obama will make two public appearances this evening, Mary Bruce notes … at two fundraisers. With no cameras allowed.
Meanwhile, the White House sans its President plans to make war on S&P over the downgrade:
The Treasury Department and the Federal Reserve have already revealed what their strategy toward Standard & Poor’s will be now that the agency has stripped the U.S. government of its AAA rating: to destroy S&P’s credibility.
They can make a pretty good case. It’s not just that S&P revealed its ratings process to be corrupt and deeply flawed during the subprime mortgage bubble, as it gave inflated AAA ratings to bad securities in order to satisfy its investment banking clients, according to the Financial Crisis Inquiry Commission report. It’s also that the ratings agency appeared to go well beyond its ambit this time by taking it upon itself to assess, as it said in its report Friday, the “effectiveness, stability, and predictability of American policymaking and political institutions.”
Rep. Brad Sherman, D-Calif., a leading voice on Capitol Hill for ratings agency reform, seconded the Obama administration’s approach in an interview with National Journal on Sunday. “They did this on the theory that Washington might deliberately refuse to pay its debt because of a political impasse. But I don’t know what makes them experts at this. They don’t have anybody over there who has ever sat on the floor of the House,” said Sherman. “S&P’s main job is rating private issuers, and they have some expertise in that, although obviously they got it pretty wrong in mortgage-backed securities. But in this case you need to be a political scientist and not an MBA. And I don’t know if they’ve got any political scientists over there.”
That runs into two problems, however. National Journal’s Michael Hirsh notes one of them, which is that Egan Jones had already downgraded the US over its dept-to-GDP ratio and the prospects of rapidly increasing debt over the next several decades. The second is the immediate spin from the White House and Democrats that tried to blame the entire thing on Tea Party intransigence. Essentially, that spin corroborates S&P’s analysis; it just blames it on a minority of politicians in a party that only controls one chamber of Congress, a rather ridiculous notion.
The White House seems rudderless, responding in entirely contradictory ways to the embarrassment of the downgrade, without any sense of leadership from the man in charge. This isn’t “leadership from behind,” it’s the political equivalent of an absentee landlord.
Addendum: I predict that Obama will change his schedule and make a public statement sometime today, only because I can’t imagine any White House allowing this much of a vacuum between a major event and some demonstration of leadership.
Update: Er … chamber of Congress, not chamber of Commerce. Yeaow. Time for more coffee. Thanks to Alex M for the correction.
Update II: Almost four days after the S&P downgrade, the White House announces that Obama will address the nation at 1 pm ET today in a statement — as I predicted.