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First Thoughts: The Katrina effect


President Bush surveying Hurricane Katrina damage from window of Air Force One, Wednesday, August 31, 2005.

Governors and the president all over learned the lessons of Katrina, but what about Washington? Will it learn the lessons of the debt-debate debacle? … Bernanke takes aim at the political system and Congress … Irene may have blown over, but here comes the posturing over jobs … But reality check on manufacturing … Perry plays the role of culture warrior in Iowa … How far does Ron Paul’s libertarianism go? Pretty far… Bachmann’s rhetoric’s in overdrive (God was trying to send politicians a message with the earthquake and hurricane, really?) … Powell not backing Obama yet … Huntsman’s in SC, Perry’s in OK.

*** The Katrina effect: The last 72 hours were evidence of the Katrina effect on everyone. Every governor watched the Kathleen Blanco model and said they’re going to do the opposite of that, which is why you saw every governor and major city mayor in the Mid-Atlantic and Northeast trying to show they were on top of this (didn't know you could get monogrammed fleeces, by the way!). And President Obama, of course, saw what Bush did (stayed on vacation) and wanted to do the opposite. Hence, why he cut that vacation short. Nobody wanted to become a member of the infamous Katrina "B-Team": Blanco, Bush and Brownie. So naturally, the story is shifting a tad to, "Was Irene overhyped by the government, by the media." Bottom line: see the "B-Team" roster again and realize, there's no over-hyping on these stories. So while elected officials proved they could learn a lesson from Katrina (though that took the near-destruction of a city for that lesson to be learned), will the elected officials in Washington, from the president to Congress realize the damage that's been done by the summer's debt ceiling debacle.  


Federal Reserve chairman Ben Bernanke at the Economic Policy Symposium at Jackson Hole in Moran, Wyoming.

*** Bernanke blasts politics: To that point Fed Chair Ben Bernanke said the pitched debt-ceiling debate was to blame for disrupting markets “and probably the economy as well,” the New York Times writes. And, he said: “The country would be well served by a better process for making fiscal decisions.” He placed the ball in Congress’ court because, “Most of the economic policies that support robust economic growth in the long run are outside the province of the central bank,” he said. He called once again called “for fiscal measures that focus on long-term reductions in the federal debt, while avoiding short-term cuts or tax increases that might impede recovery.” The Times makes this point: “Bernanke did not lay blame for the debt ceiling battle on either political party. But his recommendations for future fiscal policy— particularly the emphasis on the need for continued investment and reducing unemployment — generally hews closer to Mr. Obama’s position than to the views of Congressional Republicans.”


Flooded highway in New Brunswick, NJ after Hurricane Irene.

*** Good night, Irene, hello posturing over jobs: The hurricane may have passed, but there’s going to be plenty of churning this fall (starting this week) about j-o-b-s. In the next two weeks, we are set to get at least three jobs plans – how specific they will be remains to be seen -- from Jon Huntsman, Mitt Romney and President Obama. Huntsman leapfrogged Romney and Obama and will release his plan Wednesday from a metal manufacturer in New Hampshire, NBC’s Jo Ling Kent reports. Here’s what we’ve learned of Huntsman’s plan: He is going to talk about manufacturing jobs and the need for the U.S. to make things again. He’ll say he will make “Made in America” mean something. How does he propose getting there? First, he’ll say essentially that he would work to eliminate “regulations that are limiting the ability of job creators to enter the marketplace – EPA chief among them,” per an adviser. Because of the “economic environment and lack of certainty, entrepreneurs aren’t taking the risks necessary to get these products to market.”

*** The tax man: Bloomberg got a peek at what Huntsman’s tax plan would be and found three new wrinkles. He would: (1) “take away the deduction for interest on home mortgages”; (2) “treat capital gains as regular income”; and (3) “do the same with carried interest (that is, the profit share paid to hedge-fund managers and private-equity folks).” An opposing campaign called those essentially tax increases. Huntsman spokesman Tim Miller told Bloomberg – in full Grover Norquist language -- that Huntsman believes “any tax reform should be revenue neutral.”

*** Back to reality: But neither Huntsman nor Romney nor Obama is a pure messenger on this. Sure, Huntsman will talk about his record as Utah governor, that it was No. 1 in job creation vs. Romney’s Massachusetts, which was 47th. But his own family’s company has outsourced jobs, employing more people in India and China than the U.S. Sure, Romney will talk about being the only person with “private-sector” experience. But Bain Capital doesn’t make “stuff,” it makes money for investors and it’s proud of it. And sure, Obama will talk about various jobs initiatives he’s tried, free-trade deals brokered, and wanting (hoping) for a renewed payroll tax cut, an infrastructure bank, and road-construction bill. But he's had to live down the pre-inaugural projection his economic team made that promised unemployment wouldn’t get above 8.5%, if a major stimulus packaged wasn't passed. Well, it has stayed there. Sure, it could be worse, but as the president himself has pointed out, try selling that to a frustrated public with many still looking for jobs.

*** Inertia: Can Obama get anything through Congress? The C.W. says no. Is the president willing to campaign for his plan this fall only to have it fail in Congress? In the past, the president has played pragmatist and simply tried to create legislation that could pass even if it compromised too much in the eyes of his base supporters. Does he need to propose something big that, perhaps, is D.O.A. with House Republicans? Is that good politics? Or are things so toxic with the public, that the idea of another season of gridlock and inability to compromise to pass SOMETHING is bad politics for everyone? Bottom line: the president has to propose something re: jobs and the economy, and propose something big and fight hard for it. As one smart person said to us over the weekend, the president ought to appear to be fighting as hard to create jobs as folks are looking for ones. (And, by the way, fighting hard to create jobs also means he starts looking like he's fighting hard to keep his). The president is heading back on the road, tomorrow with a stop in Minnesota to speak to the American Legion convention.


Rick Perry speaking at the Polk County GOP summer picnic.

*** Culture Warrior: Speaking of jobs, Rick Perry, who does not have a jobs plan release date scheduled, was in Iowa over the weekend, hitting Obama for his economic policies, which he said have created “economic misery.” After thanking God for John Deere, he played the part of culture warrior: "Economic freedom comes from work and wages not welfare," Perry said, per the Ames Patch. "Since I was old enough to drive that tractor, I knew that the way to empowerment is not to empower government but to empower people."

*** The depths of Ron Paul’s libertarianism: Just how far does Ron Paul’s libertarianism go? Pretty far. He said FEMA isn’t necessary. Paul, in an interview with NBC’s Kent, dismissed FEMA as “a great contribution to deficit financing.” He added: "We should be like 1900; we should be like 1940, 1950, 1960," Paul said. "I live on the Gulf Coast; we deal with hurricanes all the time. Galveston is in my district.” But on Sept. 8, 1900, Galveston was hit with a massive hurricane that killed more than 6,000. And the sea wall that was built – and repaired after Ike -- was done so with federal dollars.


Michele Bachmann at a rally in Sarasota, Florida.

*** Bachmann’s rhetoric in overdrive: Michele Bachmann, a member of Congress who sits on the House Intelligence Committee, over the weekend poked fun at the institution that pays her. "I know it's an oxymoron to say 'House of Representatives' and 'intelligence' in the same sentence," she said. Everyone is catching the "I’m not of Washington" campaign bug. Remember, Bachmann also said she only went to work FOR the IRS “because the first rule of war is ‘know your enemy.’” And is God really sending politicians a message with the recent earthquake and hurricane? So says Bachmann: “I don’t know how much God has to do to get the attention of the politicians,” she said, per NBC’s Jamie Novogrod. “We’ve had an earthquake, we’ve had a hurricane.” Bachmann added that God is demanding politicians “listen to the American people.”


Colin Powell on Face the Nation, Sunday, August 28, 2011.

*** Powell not backing Obama yet: Most people will pay attention to Colin Powell’s swatting down of Dick Cheney, saying his book was full of “cheap shots,” and likening him to a “gossip columnist,” but maybe the most politically important thing that came out of the interview with the former Secretary of State on CBS’s Face the Nation, was that he hasn’t made up his mind on who he’s going to vote for in 2012. This is someone – a Republican -- who, at a key time, lent support to candidate Obama. “I haven't decided who I'm going to vote for," he said Sunday. "Just as was the case in 2008, I am going to watch the campaign unfold."

*** Decision 2012 Trail Mix: Huntsman is in Columbia, S.C. … Perry is in Tulsa, OK. … President Obama tomorrow heads to Minnesota to address the American Legion.

*** Monday’s “The Daily Rundown” line-up: NBC’s Jamie Gangel with more from her exclusive interview with former Vice President Dick Cheney… latest news on Hurricane Irene... NBC’s Richard Engel with the latest news from Libya… Atlanta Mayor Kasim Reed on jobs, the economy and recent criticism of President Obama by some black lawmakers… plus more 2012 news with the Washington Post’s Dan Balz, former Obama White House Communications Director Anita Dunn and former RNC Chair Michael Steele.

*** Monday’s “Andrea Mitchell Reports” line-up: NBC’s Savannah Guthrie fills in as host. The show will cover the storm fallout with reporters all over. Guests include David Rodhe, a former New York Times reporter kidnapped by the Taliban, who will talk about Liby

Countdown to NBC-Politico debate at Reagan Library: 11 days
Countdown to NV-2 and NY-9 special elections: 17 days
Countdown to Election Day 2011: 73 days
Countdown to the Iowa caucuses: 163 days
* Note: When the IA caucuses take place depends on whether other states move up