Which brings us to the greatest risk facing the world economy: Mr Obama’s failure to present a credible response to the financial crisis or even to assemble a proper economic policy team. After the British Government’s leaked messages of despair about nobody answering the phone at the US Treasury in the preparations for the G20, everybody is now aware that Mr Obama has nominated only two out of 18 deputy and assistant Treasury secretaries. What is less widely recognised is that this decision-making vacuum reflects a deeply worrying feature of US economic policy.
American politicians simply don’t seem to understand the existential threat that their economy is now facing. Instead of uniting to deal with a national emergency far more threatening to their way of life than the terrorist attacks of 9/11, they have responded by dividing more sharply than ever into hostile partisan camps.
Efforts to revive economic activity and to stabilise the financial system that are clearly indispensable on the basis of any economic analysis, whether Keynesian or monetarist or plain business-sense, have been denounced on the Right for interfering with free markets and on the Left for feather-bedding bankers. Instead of rallying around in a moment of crisis, many Americans are openly expressing their hope that the new President will fail and the economy collapse. Candidates for key Treasury posts have been viciously attacked in the media and Congress for trivial tax and administrative infractions inadvertently committed many years ago or simply for having once worked on Wall Street. As a result, these jobs have become almost impossible to fill.
Mr Obama himself seems to have attached a surprisingly low priority to dealing with the financial crisis. He had, for example, selected key State Department officials, from Hillary Clinton downwards even before his inauguration. He has managed to get dozens of these confirmed by Congress in the past two months and immediately put his personal stamp on US foreign policy. Yet there has been no similar focus on creating a properly functioning economic team or launching a coherent new response to the financial crisis.
The lack of urgency, of focus and of national unity in America’s response to the financial crisis is the most surprising – and most dangerous – threat to our chances of recovery.
Kaletsky’s right that conservatives are being stupidly obstructionist, especially about necessary political appointments. But as time goes on, the inattention of the administration to the truly urgent problem facing the country and the world is flabbergasting. The economic crisis does present a window of political opportunity big enough to drive a truck through, and so it’s easy to understand why Democrats have been gleefully loading up the truck with everything they’ve ever wanted ever. But it’s really the height of irresponsibility when the circumstances demand that efforts be devoted to ensuring the window doesn’t widen to the point that the house collapses on the truck. (What is a truck doing in the house? Can you drive a truck through a window? Where is the truck going? Another house? I can haz Tom Friedman!) If Obama does not luck out (and he is nothing if not lucky) and things get a good deal worse, this early episode of rather terrifying mismanagement will not be forgotten.
Those who think this is a mere partisan talking point and amounts to the idiotic claim that it is not possible to simultaneously walk and chew gum need to back away from their own partisanship and get a little perspective. Also, they should reflect on why Obama, despite his undisputed excellence in gum-chewing, has so far done such an embarrassing job of walking.