Believer: My Forty Years in Politics

by David Axelrod

  “I’ve always set my life up so I could tell anyone I wanted to go fuck themselves,” I said during one of our long plane rides near the end of the campaign. “And I know that you can’t tell the president of the United States to go fuck himself.”

  Barack pondered my dilemma and conceded my point. “No, you really can’t. But you’re someone who believes in public service. You have a chance to work for a president who’s your friend at a pretty important time for the country. You can make a difference. Isn’t that what this is all about?” He paused, and added, “Oh, and one other thing: You can tell me to go fuck myself, just don’t do it in front of anyone else!”

  Despite all this, Susan pressed me to go to Washington. “If you don’t, you’re going to regret it for the rest of your life,” she said. I knew she was right. “Go. I’ll come out a week a month. Maybe you can come back some weekends. We’ll get through it.” With her blessing, I told Barack I would come for two years. That was all I felt I could ask of Susan and, after going flat out for the previous two years, all I could physically and emotionally endure. Barack was fine with it. Plouffe, whose wife, Olivia, had given birth to their second child two days after the election, wanted to take a couple of years off before joining the administration. “In two years, Plouffe can take your spot and you can go back to Chicago and work on the reelect,” he said. If that was slightly presumptuous, it was no time to quibble.

  I had another reason for my two-year plan that I didn’t share. We had won the election in a deeply divided country by a remarkable six-point margin, a large enough victory to sweep sizable Democratic majorities into both the House and Senate. We had captured dozens of seats in Republican-leaning districts. Now, with expectations sky-high for Obama, we were taking over in the midst of an epic economic crisis that would get worse before it got better. It was a situation that seemed certain to result in big losses in the midterm elections, which are often unkind to sitting presidents, and I knew that Washington would be even less forgiving of whoever was sitting in my chair. I had witnessed friends unceremoniously dumped by the White House in the wake of Clinton’s rough 1994 midterm election. I wanted to make sure that I left Washington of my own volition and wasn’t booted out of town as the fall guy for the disappointing election performance that seemed nearly inevitable.

  Susan and I took a week’s vacation in Mexico, most of which I spent brooding about whether I had made the right decision. While we were there, the Times ran a story about how the administration intended to enforce strict ethical guidelines among its members, including on issues such as the payment of household staff. Susan reminded me that we had paid cash to Anna, the immigrant Polish woman who occasionally cleaned our house. I called Bob Bauer, our crack campaign lawyer, who thought it could be a deal breaker. “Maybe I’m not going,” I told Susan, barely masking my relief. It turned out that Anna, a U.S. citizen, had been assiduous in reporting the income and had worked few enough hours to exempt us from reporting. We had not done anything improper. I received that news with more than a little ambivalence, and returned home ready to plunge into my new life.

  Obama had chosen John Podesta, who served as Clinton’s last White House chief of staff, to lead the transition process that began months before the election. Working alongside Podesta, a fixture in DC since the Carter administration, was Pete Rouse, whose tenure there was just as long. Rahm, who had worked closely with Podesta and Rouse before, slid seamlessly into the staffing discussions. He was particularly worried about one personnel issue. Obama had made it clear that he wanted Valerie Jarrett at his side in the White House. She was fiercely loyal, and he felt she brought an invaluable perspective as an African American woman to an operation dominated by white men. She would also serve as a conduit to the First Lady. Though Michelle rarely involved herself in the workings of the campaign, her concerns were usually channeled through Valerie. Rahm, however, was wary of having someone on his senior staff by day who socialized and even vacationed with the Obamas on nights, weekends, and holidays.

  “I don’t want to manage the president’s best friend,” Rahm confided. “It’s a disaster. I saw these situations when I was working for Clinton, and it doesn’t work. It’s a bad idea.” So when Dick Durbin, our senior senator, approached Valerie about possibly replacing Barack in the Senate, Rahm became the most enthusiastic promoter of the idea. While Valerie was intrigued by the prospect, Barack discouraged the notion. “It sounds attractive now, but when you’re spending the next few years stomping around county fairs downstate, trying to get yourself elected, you might have a different view,” he told her. “I liked it. I’m not sure you will.” Still, Barack was a devoted friend to Valerie, and as long as she was intrigued by the notion, he wanted a window on the thinking of Governor Blagojevich, who would make the Senate appointment.

  Obama and Blagojevich weren’t close. Burning with class resentment, Rod saw Obama as an undeserving Ivy League elitist who had won the political lotto. Obama viewed Blagojevich as a vacuous lightweight and a demagogue to boot. Rod was unlikely to want to do the president-elect any favors, at least not without a price. Rahm, desperate to keep Valerie out of the White House, opened his own private channel with one of the governor’s closest political advisers.

  Soon after this trial balloon took flight, Barack persuaded Valerie to abandon the Senate notion and instructed Rahm to give Blagojevich’s office several other names he recommended as possible successors. Yet Rahm waited forty-eight hours before delivering that message and quietly continued engaging his go-between about the idea of appointing Valerie to the Senate. When Blagojevich’s man inquired what the governor would get in return, Rahm demonstrated the savvy that had made him one of the few senior members of the Clinton administration to depart the White House without ever having been subpoenaed. “He would be ‘thankful and appreciative,’” Rahm replied.

  As tapes would show when they were played later in federal court, Blagojevich was unimpressed by Rahm’s quid for his quo, having hoped for something more tangible, such as a cabinet post or a lucrative outside job. “I get nothing?” he thundered, on a wiretapped conversation. In another taped conversation with an aide, Blagojevich was even blunter. “I mean I, I’ve got this thing and it’s fucking . . . golden,” he said. “And I, I’m just not giving it up for fucking nothing.”

  Rahm wisely broke off his discussions. By December, Blagojevich was arrested at his Chicago home. He would be indicted on an array of charges, including the attempted sale of the Senate seat. I was in my doctor’s office taking a stress test before my move to Washington and I almost fell off the machine when I learned that Rod had been pinched. The Illinois governor would be stripped of his office and, later, convicted of federal charges that sent him to prison for fourteen years, an outrageously long sentence, meted out by a judge who’d wearied of Rod’s preening. I recalled my last substantive conversation with Blagojevich when he was urging me to join his gubernatorial campaign in 2002. “Come on, we’re going to raise more than anyone ever has for this thing,” he said. “It’ll be great.” My instincts, like Rahm’s, had been honed by Chicago politics. I walked away. Hearing the news about Blagojevich, I was relieved that I had made the right choice, though saddened that a guy I liked and with whom I had once worked had sunk so low. Rahm’s name and his advocacy for Valerie rated press coverage during the scandal, but there was never any indication of wrongdoing on his part.

  Despite Rahm’s unabated concerns, Valerie would come to the White House and—like Rouse and me—carry the title of senior adviser. Having negotiated a large portfolio, she would gain supervisory authority over the Office of Public Engagement and the Office of Intergovernmental Affairs, two White House agencies charged with building political and public support for the president’s initiatives. She would also become the president’s liaison to the business community, a rocky piece of real estate to hold in an administration that would cross swords with Wall Street.

 
• • •

  After the election, the transition team was headquartered in secure offices in a federal building in downtown Chicago. It was in the plaza below where, six years earlier, a little-known state senator had made his stand against the impending war in Iraq. Now, as president-elect, Obama was forging the national security team he would need to end it.

  Long before the election, he had sent out a feeler to Secretary of Defense Robert Gates about staying on in the new administration. Barack respected Gates and felt his institutional credibility and knowledge would be critical to implementing the Iraq transition and the strategic change in Afghanistan. As a lifelong Republican and a fixture in every Republican White House since Reagan’s, he would also confer a spirit of bipartisanship in national security. Six days after the election, Obama and Gates met at a fire station at Reagan Airport and sealed the deal.

  The big surprise was Barack’s choice for the other major national security position. “I think I am going to ask Hillary to be secretary of state,” he told me. I was stunned. I knew that, despite their battles, Barack respected Hillary. During our travels after the primaries, he had once mentioned that he would like to find a role for her, perhaps on the Supreme Court. There were obvious plusses to having Hillary inside the tent rather than in the Senate, where she might become a competing force—but secretary of state? That’s not just inside the tent, but center ring. I knew Barack revered Lincoln and had devoured Team of Rivals, Doris Kearns Goodwin’s riveting history of that era. Still, how could he make this former rival the top foreign policy appointee when she had run ads questioning his preparedness to be commander in chief?

  Barack was unconcerned and undeterred. “Well, we were friends before we were opponents,” he explained. “She’s very smart. She’s tough, and I believe that if she’s on the team, she’ll be loyal. We have an economic crisis that is going to be taking up a bunch of my time, at least in the near term. I need someone who is instantly recognized and respected around the world in that spot. When she lands someplace, they’ll know her. They’ll know they’re not getting the B-Team.” Barack also believed that the choice would convey a powerful message about our democracy when two opponents, having battled so fiercely, could unite after the election for the good of the country.

  Hillary initially turned Obama down. “She said she’s tired, which I, of all people, understand,” he reported. “But I wasn’t going to let her off the hook. I asked her to sleep on it.” Eventually, Hillary relented, and the warm partnership they built would become one of the inspiring subplots of my time in the administration.

  Barack’s other major focus was on forging a strong economic team, the urgency of which was clearer by the day. The October job numbers, reported a few days after the election, were catastrophic, with another 240,000 jobs lost—we would learn two months later that the actual number of jobs lost was actually 423,000. In November, we would lose another half million, the worst monthly loss in thirty-four years.

  Between campaign stops in New York in mid-October, Obama held a private meeting at the W Hotel, where we were staying. He filled me in later that evening. “I just met a guy I think you would really like,” he said. “Very smart, thoughtful, unassuming guy. He spent time overseas as a kid, so we had that in common. Plays basketball. But what I liked the most about him was that he spent the whole hour trying to persuade me why I shouldn’t hire him.”

  If that was Tim Geithner’s mission, he failed miserably. Geithner, just a couple of weeks younger than Obama, had spent much of his career in public service. An expert in global finance, he had worked in the Treasury Department during the Clinton administration, rising to assistant secretary for international affairs. Now, as head of the New York Fed, he was as deeply involved as anyone in the efforts to stem the financial crisis. Rahm and others had urged Barack to consider Geithner for treasury secretary, and the president came away from their meeting favorably impressed.

  Another candidate for treasury secretary was Geithner’s old boss Lawrence Summers, a renowned economist who held the job during the final years of Clinton’s presidency. Afterward, he returned to Harvard, where his rise and fall as university president had been a major national story. After five productive but controversial years, Summers was forced to resign after a speech in which he cited research on gender differences that, he believed, helped explain the lack of diversity in science and engineering programs. He made the point as part of an argument in favor of promoting such diversity, but Larry, who can be brusque and abrasive, had given an opening to the many faculty members he had rubbed the wrong way.

  Having read about the Harvard controversy and Larry’s role as treasury secretary in deregulating a financial sector that was now imploding, I wasn’t particularly well disposed toward him. So when I first met him during a campaign meeting of Obama’s unofficial economic advisers, I was pleasantly surprised. Robert Rubin, Summers’s venerated predecessor as treasury secretary, took issue with Obama’s focus on the middle class, arguing that Obama should cast himself as a “pro-growth Democrat,” without making what Rubin regarded as class distinctions. Summers challenged him. “Bob, it really is a problem that the middle class is being squeezed,” said Summers, who had written as much in his columns in the Financial Times. “We need growth, but the growth we’ve been getting isn’t producing the kind of gains for people in the middle it once did. It seems to me that this is a problem and we ought to be addressing that.”

  Larry wanted his old job back. Given the magnitude of the problems we would be facing, his experience and powerful intellect appealed to Barack, but Obama also liked Geithner’s freshness and his unassuming style. Barack and Rahm arrived at a Solomonic decision: appoint Geithner as treasury secretary and ask Summers to serve as director of the National Economic Council and the president’s chief economic adviser. On paper, it would be a step down for Summers. This was a staff job, not a cabinet position, and Larry was taken aback by the suggestion. Then Rahm sweetened the pot, assuring Summers that he would succeed Ben Bernanke as chair of the Federal Reserve when his term expired in 2010. With that, Larry agreed to accept the lower-profile appointment.

  Obama filled out the team with two more economists, Peter Orszag as budget director and Christina Romer as chair of his Council of Economic Advisers. Orszag, a wunderkind in the Clinton administration, was an expert on the economics of health care. Romer, a professor from UC Berkeley, was known for her writings on the Great Depression, which seemed increasingly relevant. The CEA chairmanship had been coveted by Austan Goolsbee, the University of Chicago economist who had advised us since the Senate campaign. But Barack was hell-bent on diversity, and Goolsbee had to settle for a seat on the CEA under Romer.

  On December 16, the new economic team gathered in Chicago for the first time to brief the president-elect, Biden, and the senior staff on the new economic realities we would inherit. Before the larger meeting, some of us were given a preview of the group’s forecast, and it was jaw-dropping. “Here’s the problem, folks,” I said. “The American people know it’s bad, but they have no idea it’s this bad. They haven’t had that ‘holy shit!’ moment where someone tells them the full extent of the problem. Somehow we have to get that news out so we establish the baseline we’re walking into and lay the foundation for the steps we’ll need to take.”

  The briefing with Obama, in a packed, windowless conference room of our transition headquarters, was, if possible, even starker.

  It opened with a presentation by Romer, whose cheery, Julia Child–like affect seemed rather incongruous given the bleak news she was delivering. She displayed a series of charts, all with lots of lines heading downward. Romer compared the projected trajectory of the current economy with previous recessions in the United States. “In short, Mr. President, this is likely to be the deepest recession we’ve faced since the 1930s.”

  Summers picked up the narrative, elaborating on the impact of these trends charted by
Romer. He described a massive projected loss of economic activity, and its impacts. “Given what Christy described, Mr. President, we will see a significant decline in output that will mean the loss of millions of additional jobs,” he said. “And unless we intervene aggressively and replace some of that lost output, there is a one-in-three chance of a second Great Depression.”

  A second Great Depression? Never had any of us anticipated a cataclysm of that magnitude. For all the lofty plans we had made, it was clear that we would be arriving in Washington as a triage unit, with the immediate and all-consuming priority of keeping the American economy from going under.

  Summers added an unhappy historical note about recessions triggered by financial crises. Because of constricted lending, he said, recovery tended to be slower and more challenging than the usual “V-shaped” comebacks associated with other recessions.

  When it came to bad news, Geithner was not to be outdone. Despite the initial steps by the Bush administration and the Fed to undergird the financial industry, he said, that industry’s desperate attempt to spin off failing subprime mortgages into other complex financial offerings was dragging down banks and financial institutions worldwide. “The banks are very fragile,” reported our future treasury secretary. “No one is lending, and there is a real chance that the system could collapse.”