An Inside Look at Oval Office Decision Making Under Obama

Often on Facebook and in comment sections of news articles and through conversations with friends I hear people say "What could President Obama done differently?" To answer that question, we would need some sort of insider view on what options Obama was presented with and to hear exactly what his decision making process was. We'd need some memo's or something that would detail all the paths not taken by President Obama, paths that might have led our nation back to prosperity or prevented the massive deficits that will destroy our children's futures or would have helped encourage businesses to grow and invest.

Such memo's, showing all the options that were there, together with some insider analysis, would be invaluable to answering the question "What could President Obama done differently?" Thankfully for us, that information exists, and has been looked at by The New Yorker's Ryan Issa. Americans for Prosperity sums up what just exactly goes down in the Obama White House and the decision-making of soon-to-be-one-termer President Obama:

Recently, the New Yorker’s Ryan Lizza released White House memos showing President Obama’s advisers contemplated multiple options for the original so-called stimulus package. The President’s advisers, including economists Larry Summers and Christina Romer, argued that multiple areas of the economy needed federal stimulus. Despite the advisers’ agreement that the President should engage in some type of big government intervention, the economists and the President differed greatly in their approach to dealing with the economic crisis. The memos reveal that the centralized planning inherent in big government stimulus is not quite the rational process that the Left would like us to believe, but rather a messy amalgam of competing political interests from individual planners.

Decision makers in Washington DC, like President Obama and his advisors, believe government planners can spend money more wisely than the private sector by finding specific areas in the economy where injecting federal funds can presumably improve economic prospects. They draw this so-called “targeted, temporary, and timely stimulus” from the economic philosophy of John Maynard Keynes. Instead of waiting for the free market to sort out economic problems, Keynesians believe that the government must intervene.

However, as economist F.A. Hayek observed, the knowledge required to direct the economy is too vast for any individual (or collection of individuals) to acquire. Hayek diagnosed presumptuous bureaucrats as suffering from “The Fatal Conceit”: they implement programs on the assumption that they know just what they were doing and exactly how the economy would respond. This self-deception is clearly observed in the White House’s plan for the stimulus.

During the planning and negotiations in 2009, President Obama proposed building a national so-called “smart grid” which would allow energy to flow more efficiently. It was, as Ryan Lizza puts it, Obama’s version of the Hoover Dam. But Obama’s advisers disagreed with the President’s “moon-shot initiative,” which they felt would only look good in headlines but lacked economic sense.

Lizza explained that advisers like Christina Romer had to have a “frank” conversation with the President: the smart grid was too expensive and not likely to produce short term economic benefits. Besides, Romer and Summers had plans of their own. Both proposed granting billions of stimulus dollars to states who were dealing with their own budget crises. Even these advisers, however, differed on how they thought the remaining stimulus funds should be spent. Summers preferred a more limited package with targeted spending in different areas of government. Romer, on the other hand, requested an even larger package with a different vision for the stimulus.

And yet, President Obama persisted with his politically-popular moon-shots. The President proposed a project for high-speed trains; a plan favored by Congressional Democrats. But the President’s advisers pushed back with the same argument: bailouts for struggling states were a better alternative for the economy. The President also differed with his advisers over the stimulus package’s price tag. In as attempt to control the costs of the runaway package, the President had to make a choice: give Congress high-speed trains and add in about $40 billion in Congressional “pork-barrel” spending, or cut $60 billion in stimulus that his advisers said would be more effective (the aid to states). The President showed how politics destroys the so-called virtue of government planning by choosing to give Congress its requested $60 billion in pet projects, including the high-speed trains – a direct example of how the stimulus package wasted (at least) $60 billion in taxpayer dollars.

Lizza’s stimulus memos expose the inherent flaws in any centralized planning effort. Hayek’s argument against centralized planning was not simply that it was an unfavorable method of governing, but that it was logically unworkable. Even though brilliant people worked on the stimulus package, people like Christina Romer who has a Ph.D. from MIT, none of them could possibly complete the impossible task gathering the necessary information to direct the economy. The economy is just too complex for government to direct. Their plans were pitched to the American people as objective solutions, but they really represented the individual (and in the President’s case, politicized) interests of the planners at the table.

The result? A stimulus package that failed to achieve the goals that even its own creators set out for it.

The President made bad decisions. He's on the ballot in 2012. Michigan and many other swing states will decide his fate. Vote the right way.