When You've Lost Buffett, You've Lost the Country

NBC won't tell you, but I will. Obama just turned the corner on the economy, and I don't mean in a good way.

"What is required is a commander in chief that's looked at like a commander in chief in a time of war," Buffett said.

The coverage of his interview on CNBC is remarkably devoid of long quotes, and if you saw the interview, you'd know why--Buffett was singing a funeral dirge, predicting high double digit unemployment, but more importantly being distinctly, if mildly critical of the Obama administration's response to the crisis.

The media coverage is remarkable consistent--only reporting the most mild criticism and contrasting it with Obama administration official's arguments for patience as well as the inevitable point that the president is still popular.

Well, they have to say something, don't they? Buffett is actually a latecomer to the party, but he's nevertheless a bellwether. His criticism, like Walter Cronkites criticism of the Vietnam war, is a sign that Obama's policy, and its arguments, have failed.

Just as important; the issue has turned from who is to blame for the situation (why Bush of course!) to who is to blame for not solving it.

What we're seeing her is the establishment of a media meme, not unlike the infamous 13 words in Bush's 2003 State of the Union address. The effect built over several months, but it marked the moment when the media turned from a largely suppportive-slash-timidly critical role, to the recently concluded pogrom against Bush. Notably, that controversy was also a matter of important players (the CIA) breaking ranks.

Think I'm overstating the case? Consider that as the consensus about our economic prospects are congealing, the media is getting comfortably quoting the most extreme doomsayers. Nouriel Roubini vaulted to prominence by predicting the current economic climate, and is currently predicting a 36 month recession.

The real question here is what the Obama administration will do? Clearly their hope was to push through a far-left political agenda under cover of a massive economic crisis (which incidentally, they screamed bloody murder about after 9/11, when they thought Republicans were doing the same...). The economy would recover by the end of the year, or early 2010 at the latest, leaving them well-positioned for the mid-term elections.

There are signs that Obama has an escape hatch in place.

US Treasury Secretary Timothy Geithner is practically alone on the job, working night and day to cope with the worst economic downturn in decades.

Of the 15 key Treasury Department positions that require Senate confirmation, only one has been filled. Stuart Levey, a leftover from the previous administration, who as under secretary of the treasury for terrorism and financial intelligence, is not central to the crisis management however.

Its more than a little odd that Geithner has no staff when the President has comfortable majorities in Congress, unless of course Obama is setting up a scapegoat. Its hard to imagine a better one--already reviled as a tax dodger, with no political constituency to back him up, he's a perfect patsy.

That's hardly going to be enough though. Obama is faced with an policy U-turn more drastic that Clinton's embrace of welfare reform in the nineties. His assets are a compliant state media who could spin tax cuts for the rich for their Messiah, but the liberal-left base would not be fooled. Destruction of the free market system is a religious tenet. Obama would be creating serious political problems for himself and the party.

The decision requires someone who can be brutally honest with themselves about political realities. Bill Clinton was well-suited to his similar dilemma, coming from a mixed political environment where success was based on that skill. Obama's political education couldn't have been more different. He's been groomed for success by mentors since his earliest days at Columbia. His decisions have always been about how to avoid choosing any evil by voting present, disqualifying his opponents and message control. In all likelihood, Barack Obama has never had to make a real choice.

My guess is that he'll go with what he knows, which will be to try to disqualify his critics and avoid having to change anything in his program, hoping that the predictions are off-base.

It truly is a historic presidency--no one has ever raised the draw bridge within the first 100 days.