Tuesday, August 19, 2008

Labor hits back as Rubin gains influence

The AFL-CIO goes after Obama's economic team as Bob Rubin seems to be gaining influence with his campaign:
Blaming unfettered global trade and inadequate government regulation for lost manufacturing jobs and a staggering economy, Trumka's presentation cautions that ``it will do us little good if, when the next Democrat moves into the White House, Wall Street takes command of our country's economic policy.''

Trumka leaves no doubt that the rebuke is aimed at Rubin, Wall Street's most prominent Democrat. It's ``hard to tell the difference'' between Rubin and Republican Treasury Secretary Henry Paulson, the presentation says. Trumka's critique reflects the concern among organized-labor officials that Rubin and like- minded Democrats may win the behind-the-scenes battle to shape Obama's economic thinking.

``I'm hearing Rubin's name more and more associated with the campaign's economic policy,'' says James Torrey, a top Obama fundraiser and chief executive officer of New York-based Torrey Associates LLC, a hedge-fund investor.

. . .

Rubin, in an interview, says Obama isn't favoring either faction's agenda. ``Very much as President Clinton did, he's focusing on both competitiveness and growth on the one hand, and distribution and fairness on the other,'' he says. ``It seems to me that's where he ought to be.''

Still, the Wall Street contingent's clout has grown within the Obama camp in the two months since Rubin's first-choice candidate, New York Senator Hillary Clinton, conceded the nomination.

A Rubin protege, Jason Furman, is now the economic-policy director of Obama's campaign.

Valerie Jarrett, one of Obama's closest friends and confidantes, attended a meeting hosted by Rubin, 69, several weeks ago and says they've talked by telephone several times.

At an economic forum last month, Sweeney, former Labor Secretary Robert Reich, and union advocates were outnumbered by the likes of Lawrence Summers, Rubin's successor as Treasury secretary; JPMorgan Chase & Co. CEO Jamie Dimon; former Republican Treasury Secretary Paul O'Neill; and former Securities and Exchange Commission Chairman William Donaldson, like O'Neill an appointee of President George W. Bush.

Furman, who turns 38 today, disputes the notion that any faction holds sway. ``Barack Obama is somebody who has very strong ideas about economics,'' he says. ``And no one, not Bob Rubin, not Bob Reich, not Rich Trumka, is going to walk into a room and change his fundamental, underlying priorities.''

Even so, some union leaders are already girding to fight for influence in any future Obama administration. If the Rubin camp were to win out, it would boost the odds that an Obama presidency might sidestep significant trade restrictions and sacrifice spending programs for the sake of deficit reduction.

``I worry about his influence,'' says Leo Gerard, president of the United Steelworkers.
The fact that organized labor is willing to be this public about these issues during an election campaign is a key development. For one, it means that they're as worried about prospects of progressive economic policy during an Obama administration as I am. They have everything at stake during this election... and yet they are still willing to put it out there publicly that they're upset with the direction that their candidate has taken.

It also could mean that there is a change of mindset within organized labor. They have been repeatedly shit on by the democratic party over the last several decades, but hopefully a lesson has been learned. It's thrilling to see some push back make to make sure it doesn't happen with this next administration.

Obama has two options. He can take a more populist stance on the economy, take politically popular positions, and win the election by a hefty margin. Or he can talk about the economy in moderated language, take moderate/conservative economic positions to avoid being perceived as a populist, and be tied with John "NAFTA was a good idea" McCain in Ohio.

Your call, Senator.

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