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There is a strange development going on in Washington, one that will have tremendous implications for the future of our country: it’s about the relationship between the President and the Speaker of the House. Nancy Pelosi, who many Democrats feel collaborated a little too much with George Bush, is now causing problems for Barack Obama.
Obama and Pelosi
The press has openly written about the tense relationship between Obama and Pelosi, which in Washington terms means both sides have been leaking and, in some cases, speaking on the record about their difficulties. In a story headlined “Obama’s Pelosi Problem” Newsweek began:
In recent weeks, the Obama official says, the White House has had “many candid conversations” with Pelosi and other Democratic leaders about the importance of winning over—or at least not openly antagonizing—Republicans.
The New York Times reported:
The White House was very unhappy with some last-minute adjustments House Democrats made in the stimulus legislation, restoring money for the arts and cutting some of the president’s education priorities without fully informing the administration.
Meanwhile even as they stoke the fire, representatives on both sides have issued statements saying there is no fire. Pelosi went so far as to meet with representatives of the so-called “liberal blogosphere,” which is a misnomer because none of these blogs would dare use the word “liberal” and they are more of a mafia than a sphere.
The Roots of the Problem
This blog was among the first to point out potential problems between Obama and Pelosi last fall after the election when Pelosi dissed the newly-elected President less than 24 hours after the election by presuming to tell him how to govern. Her actual words were:
But the fact is that a new president coming in, in my view, must take the country down the middle to solve the problems, to gain the confidence, to take us more strongly in a new direction.
Not only did Speaker Pelosi step over the line with her “center” remark, she went even further by proposing what should be the first piece of legislation in the House, this without any apparent consultation with our new President. The bill she proposed, the Bush-vetoed children’s health insurance initiative, is a much-needed piece of legislation and passing it would signal how the new administration will differ from the last. But President Obama may have other ideas.
Pelosi essentially shut him out, for she made a key policy decision without consulting with him. The first bill of any session–and especially of any new President–is an important symbol, for it signals the direction the new administration intends to take. Nancy Pelosi essentially preempted Barack Obama from making that decision.
Looking back on it, this was no small matter. While Barack Obama was basking his victory, the Speaker of the House crowded on to the stage and proceeded to try to hog the microphone. By dissing the President in the way she did, Pelosi made it clear that she, not the White House would set the agenda in the House of Representatives.
A Loose Canon
Pelosi has been trying lately to pass herself off as a liberal, pressing for a quick withdrawal from Iraq even though during the Bush Administration she was a supporter of war. Writing in Common Dreams in 2005 shortly after Pelosi became House Minority Leader, Stephen Zunes stated what many Democrats felt at the tim
On January 4, Congressional Democrats re-elected California Congresswoman Nancy Pelosi as minority leader in the House of Representatives. This comes despite that, since assuming her current leadership position two years ago, Pelosi has not only disappointed her liberal San Francisco constituency, but the majority of Democrats nationally as well, through her support for President George W. Bush’s policies toward Iraq.
In retrospect one of the lowest moments came during Bush’s 2005 State of the Union Address when Pelosi led Democrats in giving the President over two dozen standing ovations about Iraq.
Pelosi helped to turn the battle over the Obama stimulus package into a three-cornered fight between herself, the White House and the GOP. The fight conveniently put Obama in the middle, which has lead some to suggest that Pelosi is deliberately playing “bad cop” to Obama’s “good cop” by moving to the left of the President (whatever happened to that centrist statement?). Other suggest it is yet another example of Pelosi’s loose cannon style.
This would not be the first time Pelosi’s style has caused problems. The Bush Administration thought they had a deal with Pelosi over the bailout bill only to have the Speaker tee off on the President during the debate over the bill in a fashion that had both sides wondering what she was up to. Republicans still believe Pelosi’s tirade was not only out-of-order but added to the final cost of the bill.
Ross K. Baker, a Rutgers University political scientist who has worked as a Senate staffer, stated:
It was very provocative. When the issue is still in doubt, you don’t poke a stick in the eye of the opposition.
On the right, conservative bloggers were furious, but they had a point which was probably best articulated by Amy Holmes in the National Review:
It seems to me that the real problem with her speech was its illogic. She stridently attacked George Bush‘s “failed economic policies” and then, in the same breath, implored members to support his most controversial, unprecedented policy, yet.
So, her message was George Bush has been an unmitigated disaster for 8 years. He hasn’t gotten one thing right and has plunged America into an economic black hole. But in this case, we need to trust him. Why? Because she says so? They had a huddle?
Pelosi’s loose cannon style goes back further than that. For example, there was the dust-up over New York Representative Charles Rangel’s 2007 plan to overhaul the Bush tax cuts. Pelosi originally told the press that she supported his plan, but as The Hill reported:
When the transcript of the briefing came out, words were inserted — highlighted by brackets — clarifying that she supported his goal, if not his specific proposals.
It is this tendency to do the unexpected that has already caused problems with the White House and will continue to do so.
A Theory
My belief is that Pelosi has suddenly become reborn as a liberal and loud voice against the GOP because her job is in jeopardy. For some time many analysts, including this one, have felt she was a liability. As House Minority Leader, she badly played her titular role as leader of the opposition, coming off poorly in interviews and failing to articulate a coherent set of principles. She seemed squarely out of the Clinton triangulation mode, only unlike Bill and Hillary Clinton she could not keep the boat on course.
The mess over the Bush bailout could not have helped her, especially when it came out that she was an AIG stockholder. The debate over the Bush bailout was a perfect setup for the Democrats, especially with the election coming on, but Pelosi muffed that opportunity with her speech and then went ahead and caved in to the final bill.
But the biggest rap against Pelosi is that she does not appear to have any strong principles. It is noteworthy that Project Vote Smart, which attempts to inform the public on the positions of our Congressional representatives should say this about Pelosi:
Representative Nancy Pelosi repeatedly refused to provide any responses to citizens on the issues through the 2008 Political Courage Test when asked to do so by national leaders of the political parties, prominent members of the media, Project Vote Smart President Richard Kimball, and Project Vote Smart staff.
On the actual web page this appears in bold red type.
Pelosi’s leadership of the Democratic Congress has earned it terrible job approval ratings from most Americans. In May of last year Gallup reported:
Approval of Congress has dipped below 20% for only the fourth time in the 34 years Gallup has asked Americans to rate the job Congress is doing. Today’s 18% score, based on a May 8-11 Gallup Poll, matches the record lows Gallup recorded in August 2007 and March 1992.
Notice that means Pelosi’s first two years as Speaker are the lowest two-year total ever–by a long shot. Democrats worried that Pelosi would become an albatross for them in the 2008 election. Many Republicans still believe John McCain missed a chance to run against Pelosi as Bill Clinton had done against New Gingrich in 1996. In fact Pelosi may be the most unpopular and divisive Speaker since the days of Tom “The Hammer” DeLay and Newt Gingrich.
By creating a feud, whether real or not, with Barack Obama and suddenly styling herself as a liberal, Pelosi has made the task of dumping her more difficult. Any move to oust her will now be seen as a power move by Obama against the woman who received the coveted Eleanor Roosevelt Award from the Democratic Women’s Club and will not endear him to feminists who are still smarting over Hillary Clinton’s loss.
But there is a bigger Pelosi problem for Democrats.
The Real Pelosi Problem
For all her remake as a liberal, Pelosi is a multi-millionaire whose financial empire consists of real estate, vineyards, and resort hotels. Her 2007 financial report (the latest on record–the new one is due mid-May) is quite an eye-opener. Among her holdings at that time were:
25 Point Lobos, a commercial property valued at $5-$25 million.
Auberge de Soleil, a resort hotel valued at $1-$5 million.
A Mill Valley, California hotel investment valued at $250-$500,000
Several other million dollar pieces of property
A restaurant operating company worth $1-$5 million
Stock in Microsoft, eBay, Oracle, Dow Chemical, J. Crew, and Johnson and Johnson
Roll Call estimates Pelosi ranks 17th among members of Congress in total wealth (John Kerry is number one, for those who are interested).
While eight Democrats rank above Pelosi including Dianne Feinstein. Ted Kennedy and Jay Rockefeller, it is a bit of an awkward situation to have the Speaker of the House holding such wealth during what is shaping up as the most severe economic crisis since the Great Depression.
Critics also point out that her hotels and resorts are nonunionized. While it is true there have been no attempts to unionize Pelosi’s holdings, it would not take much for her to invite the unions in.
Unanswered Questions
But even more disconcerting is that Pelosi represents what is known as San Francisco’s financial district. This is where the real problem begins.
Pelosi has huffed and puffed about taxing rich people but she has been notably silent about the major problem with this depression–the financial industry. Pelosi supported the repeal of the Glass-Steagall Act in 1999, joining the Republican majority and President Bill Clinton.
She is a strong disciple of Robert Rubin (see last month’s cover story). The American Prospect reported than after the 2006 Democratic take-over, Pelosi arranged for briefings on different subjects such as defense policy which included experts with a variety of perspectives. On the economy she had only one expert presenter–Rubin.
This means that Pelosi and Obama’s two chief economic advisors, Lawrence Summers and Timothy Geithner are supposedly operating off the same pages, the ones Rubin wrote. So why is there this conflict between Pelosi and the White House? Rubin’s name is rarely heard in Washington–or anywhere else–these days. The man who once was at the center of both government and corporate power seems to have fallen off the face of the earth even as the nation falls deeper into an economic crisis he helped to set in motion.
Yet for all the public disagreement between the White House and Pelosi, at least in terms of economic fundamentals there seems to be a basic understanding about dealing with the financial industry that is at its center. And mainly that attitude seems to be hands off–or a handout. This is in sharp contrast to the Nancy Pelosi who last fall when asked about aid for Detroit’s ailing automakers remarked there was no support for an auto industry bailout unless they changed their ways and then helped remove Michigan Representative John Dingell as chair of the Commerce Committee in favor of fellow Californian, Henry Waxman.
What this means is that it will be even more difficult for the Democrats to move towards the reregulation that is needed in the financial industry. With Pelosi, Geithner and Summers all being Rubin disciples the prospects of a renewal of Glass-Steagall or something like it are dim at best. Whichm as I wrote last month, means the propects of overcoming this depression are more difficult.
So Pelosi essentially carries three strikes against her even as the Obama Administration struggles to steer through this storm. Her wealth and questionable union creds, her support for the financial industry and her loose cannon style. What should worry the Obama Administration and all Democrats is that even as Barack Obama has painted Rush Linbaugh’s face on the GOP, the GOP may play the same game and put Pelosi’s face on the Democrats.
This is why I headlined this piece the way I did, because it could become a rallying cry for Republicans. I could not fiund a copy of Pelosi’s tax return, so I do not know whether I paid more in taxes than she did, but the fact that the question can be raised is concern enough.
You can bet the GOP will not miss a second chance to run an election against Pelosi. That could cut into or even take away the majorities that the Democrats fought so hard to regain. It would leave us again with a divided government in a time of crisis.
Stay tuned.
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