Obama, Frustrated Dems and the Fiscal Meltdown

The complaint from the Democrats in the room was that Sen. Barack Obama wasn't acting enough like… well, they weren't quite sure: Robert Kennedy, maybe, or Hubert Humphrey, or Bill Clinton in the early 1990s. Obama had no fire, they said. He should be way ahead by now, they said. He needed a creative, sweeping new economic proposal, they said. Also, he needed to call them and ask them for their advice.

This was the drift at a Washington social event I attended the other night, the kind that draws senators, ambassadors and assorted know-it-alls.

Even as the global economy was crumbling—a huge political boost, at least at first glance, for the out-of-power Democrats—and even though Obama has climbed back into the lead in national polls, the mood among party faithful was sober to the point of gloomy.

Typical of the sentiment was that expressed by Don Riegle, a respected former senator and congressman from Michigan. A flinty native of Flint, where they used to make Buicks (the plant is long gone) Riegle is proudly old school, the kind of guy who regards an impassioned speech in a sweaty union hall as the epitome of being a Democrat.

He got wound up even as we chatted. "You've got to be able to convince working people that you'll bust through walls for them!" Riegle told me. Wall-busting determination, he said, is what Obama needed to display if he hoped to defeat Sen. John McCain. "Obama has to show that he identifies with our people. He's got to become more emotional. He has to show them that he is willing to do anything to see that people can live a better life."

Riegle's suggestion: Obama goes to Michigan and stands in an unemployment line with workers —the ones laid off in the auto industry, for example. "Just stand there and talk to them," he said.

Others weren't clear what Obama should do, but they knew it was something. For John Breaux, the cagey Cajun from Louisiana who served 32 years in Congress and who is now a leading lobbyist in the capital, the chief concern was that Obama is not 20 points ahead, which he should be given the state of the economy.

Some Dems complained that the Obama folks ask for money but don't call to schmooze. A well-to-do former Hillary supporter, but by no means a hardliner, was dismissive. "No one from the campaign calls me except to ask for money," she sniffed—on a not-for-attribution basis only. "The first time I heard from them they asked for $30,000! And I said, `which of my children do you want me to sell?'"

But I'm wondering if there isn't method in Obama's coolness, even as he tries to amp it up a bit to suit his campaign-trail critics. First, he knows who and what he is, and Hubert Humphrey, or Jesse Jackson, Jr., for that matter, isn't it. Obama is not a shouter by nature. Authenticity counts—and so does not evoking the style of, say, Jeremiah Wright. Obama is Harvard Law; it's plain fact. And he may have decided that the best quality to project at this scary and tumultuous moment is not fire but ice, not roiling emotion but studied calm.

More important, and perhaps more to the point, he is a Hawaiian. He knows something about body surfing. He knows that the key is the wave—to spot it early, to swim out to it, to get on it and let it carry you. You don't fight it; you let its power take over.

And so Obama must feel about the global economic mess. It is a far bigger and more dangerous wave than he could have anticipated when he launched his candidacy in Springfield in February 2007. Those seem, looking back, like such innocent times.

The world seems to be standing on the brink of something huge and ominous. If Obama is as smart and sober as he seems to be, he knows that the next president will face daunting challenges.

There was some real fear in the room, and it had nothing to do with the Democratic Party.

I heard it when I talked to Sen. Kent Conrad, Democrat of North Dakota. He is a low-key sort, reared in the soft-spoken ways of the Northern Plains, trained in the bleak science of accounting at Stanford University. Fiscal matters are his forte, though he never seems to get too worked up about them. His idea of high drama in the Senate is an easel with a really great bar chart.

So I was taken aback the other night by how vehement and shaken Conrad seemed (I've known him for 20 years; I can detect such things).

As chairman of the Budget Committee (and ranking member on Finance as well), Conrad is plugged into the socket of the credit crisis. When I saw him he'd just been briefed—and shocked—by Fed Chairman Ben Bernanke and Treasury Secretary Hank Paulson.

The two men had told him that, if the government had not taken over AIG Insurance, the entire economy of the United States, and much of the rest of the world, could have fallen into deep panic. Like an aggressive tumor, AIG's unsustainable insurance guarantees were spread like poisonous filigree not just in hedge funds, brokerage houses and banks, but also on the books of blue-chip corporations atop the Fortune 500. "Some very big names were in danger," he said.

"They had to do what they did," Conrad explained to me. "No choice." And as we have since learned, the takeover of AIG was not enough to calm the markets. Indeed, it seemed to have had the opposite effect.

Where the Democrats blameless?

Of course they weren't. Even Democrats in the room admitted it.

The bipartisan consensus was that the festival of dangerous greed began in the Clinton 90s. Democrats, abandoning their union and working-class skepticism of the markets, threw in with a new crowd of pro-business, pro-deregulation donors. Also, they countenanced an anything-goes mentality at what became the party's favorite new social-uplift tools, Fannie Mae and Freddie Mac. The two behemoths papered the planet with cheap (and, as we now see, shaky) home mortgages, with the whole process run (and protected) by a get-rich-quick cadre of political hacks.

But the consensus in the room also was that the sordid history didn't contain enough anti-Democratic ammunition to do McCain and Gov. Sarah Palin that much good.

In politics as in baseball, fans—voters—focus on what happens in the ninth inning, not the first. The Democrats whiffed on the credit crisis in the early years, but now they aren't at bat. It was President George W. Bush who nominated Paulson and Bernanke. If they strike out, it's the GOP that will lose the game.

Or so Obama has calculated, as he coolly waits for the next big wave.