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Monday, April 24, 2006

No change at the White House - Rove

Karl Rove is in charge of economic policy. As the NYT puts it, "Mr. Bush's Treasury secretaries ... have not had their own voices on economic policy and have been effectively subordinate to Karl Rove." (NYT, 4.5.06) And as former Bush Treasury Secretary Paul O'Neill put it, "It's all about sound bites, deluding the people, pandering to the lowest common denominator."

Rove's reassignment was window dressing. "Strategic planning" undoubtedly means "continue to spin and dissemble." At most it means the day-to-day happy face news format has been running long enough for to continue on its own. Rove is going nowhere, barring indictment. Karl Rove, Dick Cheney, and Donald Rumsfeld are not expendible. They are George Bush.

O'Neill and Lawrence Lindsey were let go back when the first wave of Bush economic promises fell through, those surrounding the stimulus value of tax cuts for the rich. This was after the excuse "it's all because of 9-11" had been milked dry. The bad news demanded sacrifice. So they sacrificed these two, blood on the altar of public opinion, so as not to have to change policies.

It was O'Neill who noted the influx of immigrants demanded an aggressive jobs program. His estimate was that 100,000 to 125,000 jobs per month are needed just to absorb new entrants into the work pool. It remains a miracle of modern statistical science that, for example, employment rose less than a million between 2002 and 2004, yet employment dropped 0.3 percent. A bare minimum of two million would have been needed just to stay even. We've talked about this before.

Now O'Neill's successor, Treasury Secretary John W. Snow is making noises about leaving. Like as not, he wants out before the economic stuff hits the economic fan, so as to avoid the inevitable sacrifice of the scapegoat. Snow will be remembered as one so bereft of principle that after staking his reputation on the need for balanced budgets, he held the coats of the men who exacted a trillion more dollars of red stuff from the future of the country. Adriana Huffington had this to say at the time of his appointment

It is a bit surprising Snow did not take advantage of Josh Bolten's "If you're thinking of leaving in the next few months, do it now." Snow leaked explicitly his plan to leave in the next few months. Possibly he has taken some hope from Rove's reassignment and imagines he might move up the ladder into a position of actual influence. Futile dream. It is more likely that Bolten, even though he once worked at Goldman Sachs, can't find anybody else interested in the job.

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