President Clinton Grades President Obama

This morning on ABC's Good Morning America, former President Clinton graded current White House occupant, President Barack Obama, an "A" but noted that the President needs to put on a more positive face when speaking to the American people about the economy.

Regarding Obama's bleak warnings that "the economy could get worse before it gets better," and that the economic stimulus program is only the beginning of the end of the economic crisis, Clinton said, "I like the fact that he didn't come in and give us a bunch of happy talk. I'm glad he shot straight with us."

But he added, "I just want the American people to know that he's confident that we are gonna get out of this and he feels good about the long run."

Clinton thinks Obama should talk to the public in greater depth about the economy.

"I like trying to educate the American people about the dimensions and scope of this economic crisis," Clinton said. "I just would like him to end by saying that he is hopeful and completely convinced we're gonna come through this."


Well, the President should tell it like it is and President Clinton is right that the President should talk to the public in greater detail about the economy and the President should never fail in assigning blame for the mess we face and that means placing some of it on Bill Clinton's shoulders though obviously this is largely on the GOP. We're in for a bitter pill and to be frank the worse is yet to come. This is a systemic crisis. It is not an inventory recession nor is it like any economic downturn since the Second World War. We're likely in or headed for a depression.  The other point to keep in mind is that this financial crisis has already taken down entire economies, Iceland and Estonia so far but Eastern Europe, Spain, Ireland and the United Kingdom loom large. Japan's most recent GDP report showed an annual decline of ovwer 12%. These are not insignificant numbers.

As Vice President Biden noted during the campaign it's time to gird one's loins.

Gird your loins. We're gonna win with your help, God willing, we're gonna win, but this is not gonna be an easy ride. This president, the next president, is gonna be left with the most significant task. It's like cleaning the Augean stables, man. This is more than just, this is more than - think about it, literally, think about it - this is more than just a capital crisis, this is more than just markets. This is a systemic problem we have with this economy."

I once thought that the Fall of Soviet Communism was the event of my lifetime. I now think that I am about to experience the most significant days of my time on this planet and I am not looking forward to it. We face the Augean Stables. Cleaning out trillions upon trillions of toxic manure is the daunting task we face. To quote Paul Krugman:

I've been saying for a long time that this isn't your father's recession -- it's your grandfather's recession. (I actually used the phrase about the last recession, too.) That is, it isn't something like the 1981-82 recession, which was brought on by the Fed to control inflation, and ended when the Fed decided that we had suffered enough. Instead, it's like the 1929-33 recession -- or the recession of 1873-1879 -- a slump brought on by the collapse of an investment and credit bubble. And monetary policy, at least in its conventional form, has already reached its limits.

Earlier this week, Martin Wolf of the Financial Times wrote a column on Japan's lessons for a world of balance-sheet deflation. This mirrors my thinking on the matter and I've written a number of posts on the matter since early December. The evidence points to a situation where monetary policy is non-existent and that only a significant and consistent fiscal stimulus will turn the economy around. The important metrics to monitor are those associated with corporate balance sheets such as debt loads, debt/capital, debt/equity. Most companies have overvalued assets on their books and their use of cash at this point seems more geared to paying off debts rather making new investments. This is despite near zero interest rates.

What has Japan's "lost decade" to teach us? Even a year ago, this seemed an absurd question. The general consensus of informed opinion was that the US, the UK and other heavily indebted western economies could not suffer as Japan had done. Now the question is changing to whether these countries will manage as well as Japan did. Welcome to the world of balance-sheet deflation.

As I have noted before, the best analysis of what happened to Japan is by Richard Koo of the Nomura Research Institute.* His big point, though simple, is ignored by conventional economics: balance sheets matter. Threatened with bankruptcy, the overborrowed will struggle to pay down their debts. A collapse in asset prices purchased through debt will have a far more devastating impact than the same collapse accompanied by little debt.

Most of the decline in Japanese private spending and borrowing in the 1990s was, argues Mr Koo, due not to the state of the banks, but to that of their borrowers. This was a situation in which, in the words of John Maynard Keynes, low interest rates - and Japan's were, for years, as low as could be - were "pushing on a string". Debtors kept paying down their loans.

However there are two differences between Japan's problem then and ours now. First, Japan's downturn was just that Japan's and not a global one. Second, Japan averted an outright depression (at least until now) because it had a vibrant export sector. And obviously, we can't all depend on an export sector to grow ourselves out of a global downturn. The fatalist in me seems to think that to clean out trillions of dollars of toxic assets the only true solution is letting the market hit bottom and start again. That's likely a multi-year if not a decade long proposition. The optimist in me hopes that the President will do what he has done so far and spend his way out of this and I remain hopeful that the Administration will act on the banks.

Tags: Bill Clinton, President Barack Obama, US Economy (all tags)

Comments

33 Comments

Re: President Clinton Grades President Obama

Is it time to nationalize the banks?

The one interview I saw Obama comment on this he said that is would be too complex and messy for the government to take over.  But it seems like it is awfully complex, messy, and destabilizing to leave these banks as they are as well.  I'm not an economist or a financial expert but it seems to me like Obama is paying to much lip-service to the principles of the "free market" - he would like to leave Bank of America et. al alone, but it seems like we are just delaying the inevitable at this point.  If the best solution is to nationalize the banks - and if Obama's presidency is truly about pragmatism above ideology - then seems like we best move forward.

Thoughts?

by mikes101 2009-02-20 06:48AM | 0 recs
Re: President Clinton Grades President Obama

There have been a few posts and diaries on the topic.

Here's a post with a few resources on Sweden's experience

Swedish Banking Crisis

by Charles Lemos 2009-02-20 02:34PM | 0 recs
Re: President Clinton Grades President Obama

Talk of nationalization is too easy-fire the bastards, clean up the books, wipe out the existing shareholders, re-privatize-all very easy to say.  This does not answer what you are actually going to do with the toxic assets, where you are going to find people to run these vast organizations, the fact that wiping out shareholders will mean recapitalization will be very difficult.

I think it best to dictate strict pay and bonus limits, perhaps an excise tax on executive compensation throughout the financial industry, and then try to nurse them along to the other side of this abyss.

by Bob H 2009-02-21 01:52AM | 0 recs
Re: Clinton deserves NO blame

Both Blair and Clinton deserve blame because they bought into Thatcherism and Reaganism respectively. In the end, Blair and Clinton adopted the unregulated free market mantra with gusto and therein lies why they shoulder some of the blame.

Try being objective. Oh, I'm sorry I forgot that you're a PUMA, objecitivity is beyond your capability. History is beyond your grasp.

You exist but to insult.

by Charles Lemos 2009-02-20 07:04AM | 0 recs
Bill Clinton needs to keep his mouth shut.

why should he even let them ask him a question like that?

The problem with Bill is that he thinks no one could ever do anything better than him and then he indicates that to the press.

Even with his positive responses, he always seems to indicate that it is all about him and the news people love it.

by d 2009-02-20 07:06AM | 0 recs
Re: Bill Clinton needs to keep his mouth shut.

Why should he even let them ask him a question like that?

Maybe because he believes in a free press.

by souvarine 2009-02-20 07:21AM | 0 recs
right.

I am sure he never sets any preconditions to his interviews.

by d 2009-02-20 07:34AM | 0 recs
Re: Bill Clinton needs to keep his mouth shut.

Right because he didn't preside over a period of great economic times in this country getting us out of the crap that was the Reagen/Bush era.

by jrsygrl 2009-02-20 09:37AM | 0 recs
Re: An Economics Professor Responds

Then she can argue that point with Krugman and Wolf.

No, the Asian crisis is from 1997. Japan's problems date to 1991.

Actually by the end of the hour, you won't have an account here either.

by Charles Lemos 2009-02-20 07:08AM | 0 recs
Re: An Economics Professor Responds

It's petulant clowns that I don't care for. Or PUMAs. You're here to disrupt not to add any thing of substance because that's beyond your abilities. You destroy not create. That in a nutshell is the essence of the PUMAs, the politics of destruction.

You're pathetic. And so is that cesspool called the Confluence. I have better things to do than suffer your foolishness.

Go ahead write your little post on The Confluence attacking me. You're not liberals, as Wonkette noted your the land of the failed meme. No one pays attention to you and that's what is killing you and so you come here to drum up old hatreds. It's true. I hate the PUMAs and you hate me.

by Charles Lemos 2009-02-20 07:20AM | 0 recs
Re: President Clinton Grades President Obama

We could have had a lot more fun if he had said "Hm, I give him an A minus."

by Steve M 2009-02-20 07:25AM | 0 recs
Dadinkat is wrong. Yes downturn in Japan's economy

affected the ASEAN region, however the raison d'etre of the crisis remained within Japan itself. Secondly CL is right, Japan's downturn started early in 90s whereas the SouthAsian Tigers economic crash happened later in the 90s.

by louisprandtl 2009-02-20 07:30AM | 0 recs
Please Ignore the PUMA trolls

Please ignore and do not exchange comments with PUMA trolls like myiq2xu and mawm. They can't come to terms that Obama won the nomination under the rules set forth by the Democratic Party. They choose to be bitter knitters and that's their right. But they are here to disrupt simply because I exposed them for what they are.

Vile and hateful, I believe, were the words I used to describe their so-called movement. Accurate then and accurate now.

by Charles Lemos 2009-02-20 07:34AM | 0 recs
This isn't about Obama

You're just a little f**king ray iof sunshine aren't you?

by myiq2xu 2009-02-20 07:37AM | 0 recs
Re: This isn't about Obama

You should examine your sig.  It's both ironic and stupid....a very unusual combination.

by lojasmo 2009-02-20 08:21AM | 0 recs
Re: Are you sure you want to air this in public?

I hope you decide to air this in public!

by MNPundit 2009-02-20 08:33AM | 0 recs
Bill Clinton is right

Obama is doing a great job. But not only does he need to give more "hope" to the American people (to help calm the markets), he does need to get on top of the negative media spin(s) that the Repugs are so good at producing. He should remind the American people of who got us into this mess to begin with. He should point out that the Repugs answer to everything is tax cuts. Well, the stimulus plan offers tax cuts (which they voted against) in conjunction with spending that have proven successful in past Presidencies such as Clinton.  What I don't think is good is allowing the repug spin to take hold in the media.

by nikkid 2009-02-20 08:39AM | 0 recs
Re: Bill Clinton is right

Exactly right.

by jrsygrl 2009-02-20 09:37AM | 0 recs
Re: President Clinton Grades President Obama

One of the most astonishing aspects about many among the so-called progressive bloggers is their inability to attribute greatness to Bill and Hillary Clinton and the long reign of peace and prosperity connected with the Clinton years.

Recently a Right-wing Rupert Murdoch-led rag across the Atlantic tied Bill Clinton at #14 among all US Presidents (one will note that the list quite deliberately places him at #15, when according to their own reckoning in fact he ties at #14).  That same list would have us believe that Cold Warrior Harry Truman, very brief reigning (and little of substance accomplished) JFK, Vietnam War paralyzing LBJ, Sleepy 1950s Eisenhower, intellectual but aloof and myopic Wilson, and of course Reagan--whose Reagonomics have left the country in shambles--all were greater than Bill Clinton.

Well, from all the Presidents I have lived through, I can think of no other presidency I would rather have repeated than that of Bill Clinton's.  Those who would like to re-live the Eisenhower, Kennedy, Johnson, and Reagan years are welcome to do so.  The rest of us who endured them have too many vivid memories of Cold War shenanigans and a crippling of the once much envied United States economy.

Bill Clinton--hands down the best President since FDR, but who will never get his due because so many Republicans and seemingly progressive bloggers like Charles Lemos are so steadfastly unable to accept his achievements, brilliantly evident to most of the rest of the world.  Which is why Bill and Hillary Clinton are still commanding global political rock stars, even if they are underappreciated in the United States.

For years after 9/11 the GOP promulgated the mythology that Bill Clinton was remiss, even though that sad incident occurred some nine months into George Walker Bush's reign.  One should note here that these same members of the anti-Clinton crowd fully blamed Bill for the Somalia Black Hawk Down incident, just weeks into his presidency--although his immediate predecessor had engaged the forces into Somalia.

Of course, the fact that the Clinton budget bill passed Congress without a single GOP vote, which resulted in a GOP takeover of Congress in 1994, somehow is not mentioned when determining what truly created the 1990s boom.  And of course, not just the "dot com" empire, but also the brilliant economic leadership in that beautifully designed 1994 budget bill led to the longest peacetime expansion of the United States economy in the nation's history.

The Clinton years, from the beyond the beltway and inveterate Clinton-hating crowd, were packed with impressive achievements.  Not just the longest sustained peace and prosperity era, with a golden surplus coming at the close, but a lasting Irish Peace Pact, AMERICORPS, the busting up of Big Tobacco, the signing of the Brady Gun Waiting Law, welfare reform, the first serious effort at comprehensive health care, a much more embracing relationship between rival parties in the Middle East--and a literate crowd in the White House, including a Commander-in-Chief who could hold his own in any crowd of any social strata.

Bill Clinton concluded his presidency, alongside a long Ken Starr Witch Hunt and Congressional Impeachment nonwithstanding, with sky-high approval ratings.  A sustained peace and prosperity ought to pay those approval dividends.

Bill Clinton never believed in Reaganomics.  He was the ANTIDOTE to Reaganomics. Whereas
George Walker Bush worshpped all things Reagan.  And we now know which path taken was terribly wayward.

As a devoted Clintonite, I am much impressed by the leadership, the intellectual and perspicacious management of President Obama.  I believe he has the makings of genuine Presidential greatness, along the lines of Lincoln and FDR, whose examples he has wisely chosen to follow.

But if he even achieves half of the real success of Clinton years, President Obama will still be a great United States President.

Bill Clinton is absolutely one of our nation's top ten--if not top five--Chief Executives.

But I, now fifty-five, will be long dead before he gets his due.  If the GOP ever had a President with as long a reign of peace and prosperity--and with as much fiscal discipline--as Bill Clinton, not only would they have demanded his presence on Mount Rushmore, but they would secured for him his very own Mount Rushmore.

Acrimonious purists like Mr. Lemos notwithstanding, Bill Clinton was, and remains through his Global Initiative, truly great.

And for many beyond the Beltway, his peace-and-prosperity years are remembered quite fondly.  Alas, the great majority of us living through presidencies, and cognizant of presidential attributes and vicissitudes, are not determining factors.  Instead, the political slant of a select group of so-called "historians" determine "greatness."

And so to Mr. Lemos and his fellow Bill Clinton fault-finders, we Clintonites shall happily trade you a re-living of the Eisenhower, Kennedy, LBJ and Reagan years, if you will permit us the re-living of the Clinton years in turn.

Enjoy your Cold War, Vietnam, supply-side and trickle down administrations, all over again.

But let us Clintonites enjoy anew the Clinton years.  The best of my lifetime, I know.  And Bill Clinton is absolutely the best President since FDR.  Even if the anti-Clinton crowd still rules the MSM, its pundits, and yet predominates among the called "presidential historians."

by lambros 2009-02-20 08:49AM | 0 recs
Re: President Clinton Grades President Obama

GREAT POST. These people who call themselves Democrats have for whatever reason bought into the right wing fringe element smears.  

by jrsygrl 2009-02-20 09:39AM | 0 recs
Re: President Clinton Grades President Obama

Clinton and Blair bought into neo-liberal ideology. This is not to say that there weren't accomplishments of the Clinton era but let's face it at the end of the Clinton era, income distribution in the US was wider that it was at that start. Clinton's economic success did lift all boats but it lifted the rich higher and faster. The gains made favored the rich. Not as bad as during the Bush years which were disasterous for the poor. But Clinton didn't reverse Reaganism. He abetted it. What I most care about is fairness and under Clinton the US became more unfair, not less. Go look at the Gini Coefficient. That tells you the story.

And then there is Rwanda. The Clinton Administration missed that completely. Clinton had failures. Some objectivity is required. Citing his failures doesn't make me "anti-Clinton."

by Charles Lemos 2009-02-20 10:39AM | 0 recs
Re: President Clinton Grades President Obama

I think if you crunch the numbers, you will find that only the top 1% really shot the moon under Clinton.  In contrast to how it works under Republican administrations, folks towards the lower end did quite well under Clinton in comparison to, say, the top 5% or 10%.

I also think getting the deficit under control while simultaneously growing the economy to such an extent is a substantial accomplishment - who else has done it? - and it shouldn't just be shrugged off.

by Steve M 2009-02-20 11:02AM | 0 recs
Re: President Clinton Grades President Obama

Clinton did a fine job as President but no one is perfect. But some people seem to think that you can't crticize some of the failures or lapses of the Clinton Administration.

Your point is well taken. Clinton lifted all boats, that which the GOP keeps on promising but never delivered.

by Charles Lemos 2009-02-20 01:00PM | 0 recs
Re: President Clinton Grades President Obama

Clinton is certainly not immune from criticism.  In my opinion, the man has shown a remarkable capacity for retrospection and self-criticism in his own right.

What gets the goat of the Clinton fans is not the mere fact of criticism, but rather the people who toss around rhetoric suggesting that Clinton was really just another link in an uninterrupted chain of corporatist policies that started with Reagan.  It's true, he didn't completely turn the ship around or anything, but considering that he was still overseeing a fundamentally conservative electorate I think he did pretty darn well.

Criticism is perfectly fine.  But some of the rhetoric, my goodness, it's like a conservative hating on Reagan because he didn't actually manage to dismantle Medicare.

by Steve M 2009-02-20 03:59PM | 0 recs
personally...

...i do not want to relive the clinton presidency.

Truthfully, I think he was a good Democratic president that was stuck governing during a conservative economic era and so his lasting legacy is that he kept the crazy people from destroying everything from the New Deal and the Great Society.

And I thank him wholeheartedly for that.

The man had such great talents, but he could not take the job seriously enough to control his personal behavior.

I do not want to relive the dismantling of "welfare as we know it".

I do not want to relive "monica" and her dress.

I do not want to relive the health care debacle or "don't ask don't tell.

I do not want to relive the republican revolution or newt gingrich.

and I do not want to relive "I did not have sex with that woman".

yes, I would prefer to relive the era of progressive economic policies with FDR, JFK, and LBJ.

Bill Clinton was president, but it has been over now for almost a decade.

by d 2009-02-20 11:14AM | 0 recs
I am 100% in agreement with you

Lambros. I could not say it better than what you just said. Bill Clinton's Presidency was the best in my lifetime. And - for the record - my 83 year old mother also rates him #2 after FDR (and she voted for Reagan!!).

I've never understood how DEMOCRATS could run Bill Clinton down, it never made sense to me. Look I didn't vote for Obama because of my own personal (puma) reasons at the time of the election.

But I see EXACTLY what the Repugs are doing or trying to do to him and their strategy is EXACTLY what they did to Bill Clinton. Yell, Scream and "Just say No" to everything Obama proposes. They want to fight their way back into control of congress by being the loud 'naysayers' they were under Clinton, yet providing absolutely NO ANSWERS to any of our problems, financial or otherwise. Instead this group of nimwits gains control by spewing hate and getting the country worked up against groups of peole: gays, immigrants, whatever - their strategy has always been divide and conquer because they have NOTHING ELSE.

Bill Clinton, Barack Obama, and Hillary Clinton are all cut from the same mold. Their goals are the same, their economic plans and strategies are the same - there is no reason at all for ANY DEMOCRAT to dislike Obama or the Clintons.

I have put the primary wars behind because OUR moment has (finally) arrived and we need to take complete advantage of it in order to move our progressive agenda through.

Obama is fortunate that he KNOWS what the Repugs will do and he can learn from the mistakes that Bill Clinton made (yes, he wasn't perfect). But that means we all have to unite behind him and if any of the Clinton-bashers here bothered to read or listen to the video of Bill Clinton talking about Obama - he gave him an A and said he was doing a GREAT job. THAT carries ALOT of weight for those who fondly remember the great economic times of the 90's - what Bill Clinton came into and how he left us.

So whether it's Bill or Obama or Hillary - they are all saying the SAME thing.

by nikkid 2009-02-20 11:17AM | 0 recs
believe me, I've enough degrees to know not to

flaunt them...i'll leave it at that...

by louisprandtl 2009-02-20 12:11PM | 0 recs
Charles, you should've left his comments up.

They show exactly what PUMAs have become...

by louisprandtl 2009-02-20 12:19PM | 0 recs
Re: Charles, you should've left his comments up.

...pro-universal healthcare Michelle Malkins.

by Rumproast 2009-02-20 01:40PM | 0 recs
The thing is after "its" masterful

performance in this diary comment threads, PUMA myiq2xu seemed to have vanished or fallen off the grid here...I'm left wondering which corner of the Universe was "it" from...

by louisprandtl 2009-02-20 02:03PM | 0 recs
The PUMA Universe is a padded room
No one but no one pays attention to the poor pitiful PUMAs. And that's what drives them crazy. They want people to pay attention to them. They adored all the attention they got during the Summer until people, myself included, figured out they were simply lunatics. They are a cult, the cult of Clinton. Pity Clinton won't ever have anything to do with them.
 
by Charles Lemos 2009-02-20 02:28PM | 0 recs
It was never was about political philosophy

or principle, was it? PUMAs was always a personality driven cult. For me and I presume most of C4O folks, it was a simple math. We fought hard for Clinton during the primaries, however would support the party nominee for GE. And I've stated publicly here and DKos as far back in March. When HRC withdrew and asked us to support BO, there was no hesitation in me. Yes, primary war left lot of bruises on both sides. DKos brings back haunting memories for some of us but for others MyDD was not fair to them either. I was lucky to have C4O folks and later MM to get over primary scarred memories.

BTW I'm glad to read you here at MyDD.  

by louisprandtl 2009-02-20 02:58PM | 0 recs
Re: President Clinton Grades President Obama

President Obama has expressed hopefulness from the very beginning, while balancing his expectations with clear realities.

Bill Clinton's comments did not need to be made.

Why can't he let his wife have her time in the spotlight?

by KoolJeffrey 2009-02-20 06:45PM | 0 recs

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