White House Update

White House Update
Thursday, April 23

The President’s meeting today with 13 executives from the credit card industry underscores one of the administration’s most vexing dilemmas: trying to stabilize the banks while getting the struggling U.S. economy back on its feet.

Here’s the dilemma: the White House acknowledges that a sound banking system is one of the bedrocks of the American economy. To be sound, banks have to have, and are shoring up, their capital position. But at the same time, they’re being asked to step up lending.

Obama told the executives today that the interest rates and fees they charge are “unfair” and says they need to be more “consumer friendly.” The banking industry’s response – although they didn’t say this to the President’s face today – has been along these lines: “We HAVE been consumer friendly; TOO consumer friendly. We flooded the market with cheap credit for much of this decade and now a lot of customers can’t pay it back.”

The President himself knows all too well about credit card debt. At the White House news briefing this afternoon, Press Secretary Robert Gibbs told reporters that up until recently – obviously before the multi-million dollar book sales – Obama himself was in the red.

But the high levels of credit delinquency, personal bankruptcies, auto repossessions and, of course, mortgage foreclosures, appear to support the banks’ point. No question, millions of Americans are hurting – but for people with a proven inability to pay, who are already up to their necks in debt, is more debt the answer?

In short, that is the banking industry’s position – and the President’s dilemma.


WITHER IRAN?

Another dilemma for the West Wing - surprise, surprise: the Middle East. During talks Tuesday with Jordan’s King Abdullah, the President said he wants to see Israel, the Palestinians and neighboring Arab countries – like Jordan – to step efforts to forge some kind of peace agreement. The White House envoy to the region, former Senate Majority Leader and architect of the Northern Ireland peace agreement, George Mitchell, says he is cautiously hopeful.

To nudge things along, Obama will invite Israeli Prime Minister Benjamin Netanyahu, Palestinian Authority President Mahmoud Abbas and Egyptian President Hosni Mubarak to the White House for talks in the next few weeks. But not all at once.

But Obama’s priorities are not Israel’s. Netanyahu said earlier this week that he will not participate in talks until the President makes headway on Israel’s number one issue: stopping Iran’s nuclear program. To drive that point home this morning, the President was told by Israeli Ambassador Sallai Meridor to confront Iran “before it’s too late.”

Meridor made the comments at a Holocaust memorial service on Capitol Hill. Also speaking: a top official of the U.S. Holocaust Memorial Museum, Joel Geiderman, who was even more blunt, reminding Obama about Iran’s pledge to destroy Israel. He warned the President to ignore that threat at America’s “own peril.”

The White House also faces a dilemma with the Palestinians. Abbas’ Fatah faction has seen its power eroding, to the benefit of the Islamist militant group Hamas. Hamas controls the Gaza Strip, but the administration has so far maintained the Bush policy of refusing to deal with – branding it a terrorist group.


TORTURE LATEST

At the briefing, Gibbs appeared to distance himself from comments made this morning by Defense Secretary Robert Gates, who said he supported the release of sensitive memos on detainee interrogation methods. Gates said he viewed the disclosure as inevitable.

Gibbs’ response: "I have not seen Secretary Gates's full remarks." Gibbs inferred that a lot of people have different opinions on the subject. He added "The problem...isn't the existence of a paragraph or a term in a memo…It is the very existence of their use."

FIRST 100 DAYS (94 and counting)

Conflicting editorials in the Wall Street Journal and Washington Post.

The Post’s David Broder says Obama has gotten off to a good start: The "President has shown - and it is important - a mastery of the art of managing the presidency." He lauds Obama’s He lauds his “good organizational and management skills” and says in sum, “A bravura performance on Obama's part."

The Journal’s Daniel Henniger counters, focusing on the president’s grip-and grin with Venezualan President Hugo Chavez as symbolic of White House weakness. He writes: "The weirdly ebullient Mr. Obama did not...show reserve." He adds: "The Obama people seem to believe that talking top guy to top guy is the yellow brick road to progress" and that "There appears to be no coherent strategy beyond "talk to our enemies."

WEST WING NOTES

…the President will hold a prime-time news conference next Wednesday at 8pm, EDT; it is the 100th day of his presidency.

…it was “Take Your Daughters to Work Day” at the White House, but Malia and Sasha Obama didn’t make the 60-secnd commute to the Oval Office with Dad. First Lady Michelle Obama did speak to 160 kids – of administration, household and Secret Service employees. Mrs. Obama said: She doesn’t miss cooking, the new dog, Bo, is “crazy” and says one of the best parts about being First Lady is that she gets to do a lot of “fun stuff.”

White House Update

Immigration Redux
Immigration is regarded as a “second-tier” issue in the West Wing (education, health care and energy being the administration’s top priorities), but the president still wants a “comprehensive solution” to the problem and a bill to be crafted this Fall. The centerpiece of any legislation would be putting the estimated 12 million illegals in the U.S. on the path to eventual citizenship. But Press Secretary Robert Gibbs told reporters this afternoon that illegals would be put in “the back of the line” and made to wait. Gibbs also suggested that they learn English. The White House also warned that it wants to step up the crackdown on employers who flaunt the law by hiring illegals. If all of this sounds familiar, it is: President George W. Bush tried, and failed, to pass comprehensive immigration legislation in 2007. Analysts warn with the economy in rough shape, the task of passing a sweeping immigration bill may prove to be infinitely more daunting.

War Funding Flip Flop?
The President is also asking for an additional $83.4 billion for military and diplomatic operations in Iraq and Afghanistan. Obama opposed such funding two years ago when he was in the Senate. The request would finance the additional 17,000 troops for the Afghan theater bringing the number of American servicemen and women there to 55,000, a 59% increase. Meantime: the Congressional Research Service says the funding request would push the costs of both wars to nearly $1 trillion since the Sept. 11, 2001, terrorist attacks.

Housing Confab
President Obama claims that his administration’s policies (along with actions by the Federal Reserve) have lowered mortgage rates to historic lows, giving millions of Americans the opportunity to refinance their homes. Critics say the rates are artificially low, but the administration says it will do whatever is necessary to get the housing industry moving again. Meeting in the Roosevelt Room with the president was Treasury Secretary Geithner, Housing and Urban Development Secretary Donovan – and homeowners from the Washington DC area who seemed pretty nervous in their high-powered surroundings. Reporters asked about the Somali pirate situation and were rebuffed by the president: “Guys, we’re talking about housing now…”

Quick Hits
…Did the President bow when meeting Saudi King Abdullah at last week’s G20 summit? “No,” Press Secretary Robert Gibbs said. “He bent over to shake his hand…”
…Next Thursday (Apr. 23) the White House sponsors “Bring Your Child to Work Day.” Will Malia and Sasha accompany Dad on his 60-second commute to the Oval?
…The East Wing has released the White House Easter egg design. They have an environmental theme…
…First Lady Michelle Obama was seen puttering around in the new White House garden this afternoon. With her: Agriculture Secretary Tom Vilsack, a White House chef and students from Bancroft Elementary. They planted seeds – 55 kinds of fruits and vegetables, except for beets. The President doesn’t like beets…

Obama, Brown Weigh Financial Overhaul

The latest incarnation of the “special relationship” between the United States and Great Britain was on display Tuesday, as President Obama welcomed British Prime Minister Gordon Brown to the White House for a two-day visit.

Obama said ties between Washington and London were strong and would stay that way, calling it “a
a bond that will not break.” He said it was critical to the security and economic well being of both nations.

For his part, Brown said “It’s a partnership of purpose that is driven forward now by the need for us all to work together in unity to deal with the world economic problems.”

Those problems – which have engulfed the global economy – dominated the meeting between the two men, their first since Obama’s inauguration. White House officials said the two leaders have begun to outline a new set of financial regulations that they hope will help stabilize the global economy. Brown, in fact, has called for a new Bretton Woods agreement, referring to the 1944 conference that established global monetary and financial order after World War II.

The meeting laid the stage for next month’s Group of 20 Summit meeting, which Brown will host in London. The G20 is comprised of financial ministers and central bankers from 19 countries and the European Union.

STRAINED TIES DENIED

Reports the two men would hold a formal joint news conference were unfounded, causing some correspondents to wonder if somehow Brown was being slighted – pointing out that President Bush always held news conferences with Brown and his predecessor, Tony Blair. A top White House aide denied it, and Obama appeared to address the issue directly saying “I’d like to think our relationship is terrific.”

RUSSIA AND IRAN

Meantime, Obama knocked down a New York Times report saying he had offered an explicit deal to Russia in which the United States would halt the deployment of an anti-missile shield in Poland in return for Kremlin help in getting Iran to stop its “commitment to nuclear weapons."

Obama admitted sending Russian President Dimitri Medvedev a letter, but said the Times “didn’t accurately characterize” it.

The president said the letter, which was “very lengthy,” dealt with a broad range of issues of concern to both Washington and Moscow, including Afghanistan, terrorism. He added there was nothing in the letter that he hadn’t spoken of publicly, “which is that the missile defense that we have talked about deploying is directed towards not Russia but Iran. That has always been the concern, that you had potentially a missile from Iran that threatened either the United States or Europe."

Russia has deep business ties with Iran, including Kremlin assistance in building two nuclear reactors for Iran at Bushehr; Moscow is also weighing the sale of its sophisticated S-300 surface-to-air missile to Tehran. A Russian newspaper reported in February that the sale is on hold, at least until the G20 meeting in London, when Obama and Medvedev will meet for the first time.


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