Since Franklin Delano Roosevelt took office in 1933 during the Great Depression, a president’s first 100 days—the initial launch of the administration and what that president is able to accomplish at the outset—has been seen as a gauge of effectiveness and a harbinger of success (or failure) in the months and years to come. For Barack Obama, in particular, the necessity of taking a running start, a leap, really, at a time when the country was facing economic disaster, not to mention embroiled in two ongoing wars, is parallel in many ways to the situation faced by FDR as he prepared to push through the New Deal. Like his predecessor, Barack Obama knew he needed to capitalize on his seemingly unlikely victory and make things happen—quickly.
If I had a chance to go back on that inauguration night…and talk to that Barack Obama, I’d say, “First of all, you’re gonna get really grey quick.” If I had more time, I’d tell him very specifically, “There’s going to be a moment where the stock market plunges 700 points, but it’ll be okay.”
Oh my gosh, well the night of the inauguration, I just remember being cold and exhausted and thinking tomorrow, my goodness, you really get back to work.
I don’t think there’s anything that can entirely prepare you for the day you’re actually elected the President of the United States…My favorite memory of that day is actually driving with our daughters down Lakeshore Drive [for the inauguration]. This was the first time we had full Secret Service and Malia, who was 10, and Sasha, who was 7, were in the backseat. And Malia says, “Daddy, you won right?” And I said, “Well, we don’t know yet. We’re still counting the votes.” And she says, “There’s supposed to be a big party downtown where everybody’s going to celebrate if you win?” And I said, “Yeah, that’s right.” So she says, “Daddy, I’m not sure people are coming because the roads are empty.”
It was the first time they’d cleared the roads for us, and it was true, it was a little spooky, but it gave you some indication that this was now different. So that by the time you walk on stage the enormity of it hits you. You understand that it’s game time and you have to meet the moment as best you can.
And it’s day one and it’s really a startup company. And there’s no one there but us. When I walked into my office, I just couldn't believe it was an office in the West Wing of the White House. Just footsteps away from the president of the United States. It was amazing.
I was a little freaked out that I’m with my mentor, my friend, my boss..Barack Obama. He’s in the Oval Office and he’s president of the United States and it took me a day or two to sort of grapple with that. And I remember him saying, “You guys need to spend more time in the Oval Office so you can get used to it because we have work to do.” I’m just sitting there staring at the windows, looking around while we’re discussing some intense things and it was a surreal time.
The first several months are kind of a blur. We were losing 750,000 jobs a month. The economy was in near collapse. We were all afraid that we were heading to the next Depression. And there were really no rules. We never had this kind of an economic crisis in any of our lifetimes in our country. Figuring out what to do to right the economy was step one, but at the same time, world events are happening and we were fighting terrorism, Osama Bin Laden was still alive and…someone said it was like drinking out of a fire hose.
We were still trying to find our way around and find out how to get lunch and find out where the bathrooms were let alone rescue the global economy and the auto industry and prosecute two wars.
It was tough. The transition from the campaign to the White House is always difficult because you know, the very clichéd phrase, You campaign in poetry and govern in prose, that’s true. It was particularly difficult for us because of the crisis.
The only way I could describe those days was surreal. It was incredibly intense and we also had not just the problems that we were dealing with when we came in, but new ones would come up constantly. It just felt helpless.
The job of being POTUS actually begins well before the clock starts ticking on the first 100 days. And for Obama and his new and emerging team, faced with economic news that was bad and getting worse by the hour, it was even more urgent to take action before stepping into the Oval Office.
I had already been in close consultations with the Bush administration and Treasury Secretary Paulson after Lehman Brothers had collapsed. And I had participated in meetings and conference calls with some of the key economic figures in the country about how to manage what looked to be a potentially historic recession. I had to weigh in and assure Democrats that it was the right thing to do for us to intervene in the banks even though it was highly unpopular. So, in some ways, by the time I took that stage in Grant Park I was already familiar with how rapidly the economy was plunging.
I remember my first time coming to the White House was during the transition…It was twilight and the whiteness of the house just popped out and it was obviously right before the holidays and as we walked up the path, the camera crew that normally is on what we call Pebble Beach to the right of that path, one of them shouted out, “Welcome to the White House!” And I burst into tears.
At a very young age [he] came to office to make monumental decisions of economic importance that were as significant as the decisions that Franklin Roosevelt had to make with respect to the Depression…People…were losing their homes. Banks were folding, huge wealth had just disappeared and he came into that before he was even president…It was the first thing he had to get done…and he did it. There are real parallels between what President Obama did and what Franklin Roosevelt did.
I remember the fear. I remember on the campaign, one night we were there around midnight. And [economic advisor] Brian Deese was walking through the office white as a sheet and he said, “I think GM’s going to go under tomorrow.” That’s what was happening at that time. It seemed like the bottom had fallen out of the economy and no one fully understood why or how.
We knew things were bad but looking back, even on Election Day...we didn’t know just how bad. A couple months before the election we started getting into this rhythm where the crisis was accelerating, you had Lehman Brothers, you had AIG, and the president, or the candidate at the time had to start operating both as a candidate and as something closer to the president elect.
He had a call in early December with that initial team to talk about the economic agenda…And I spoke first and said, “Well, Mr. President, your main priority and your singular priority and it’s the only one that matters is preventing the second Great Depression. And nothing’s possible if you don’t do that.” And he cut me off and said rather sharply, “You know, I’m not going to be defined just by what I prevented.”
And he went on to say, “We’re going to try to figure out how we craft strategy around a whole set of other challenges. And we can't put those off indefinitely. And of course, I understand that our capacity to do those things will be determined by our ability to save the economy from a second depression.” I was struck by the ambition and the confidence in that.
On December 16, in Chicago, in a now famous meeting, the president-elect was briefed by his new economic team as well as outside advisors—top economists from around the country. The outlook wasn’t rosy.
Larry Summers [director of the National Economic Council] and Christie Romer [Obama’s chief economic advisor] and Tim Geithner and the folks who had already agreed to come on board were briefing him and it was apparent that we were in a free fall. And really had to just figure out what to do about it.
We had a seminal meeting on December 16th of 2008 and it was so impactful that I'll never forget the date. It was at the transition offices in the Kluczynski building in Chicago. And it was a briefing on where the economy was and where it was going. It was the first time all our economic advisors were together and it was the president elect, the vice president elect, the people who were coming in as senior staff and the economic advisors.
And Larry Summers, who was coming in to head the National Economic Council as chief economic advisor, former treasury secretary, said, “We’re going to lose millions of more jobs, Mr. President.” [That was the] first time I heard people refer to him that way.
It was a snowy day in Chicago. We had not yet been sworn in and Christie Romer indicated in terms that are not appropriate for the History Channel—but could be on HBO—that this was turning into a really big problem.
Christie Romer said to the president, “This is your Oh sh*t! moment.”
Christina Romer went through a series of charts but the bottom line was: This will be the deepest recession since the Great Depression.
We sat there and we just painted the most honest dark picture we could about the risks we faced and what it was going to take to deal with them. And that was deeply sobering. For a lot of people who’d been consumed by the campaign, I think it was newer for them. I didn't feel that was a moment of epiphany for the president-elect because he’d been deeply involved in talking to a really broad range of people as the crisis intensified in the fall…He was pretty close to reality at that point.
It wasn’t until the following two, three, four weeks where you get a sense of the magnitude of the economic contraction. We actually saw a bigger contraction right after Lehman Brothers than we did at the start of the Great Depression and it was only because we intervened as aggressively that we did that we did not see, ultimately, a depression.
As bad as the details were, the president looked at us and said, “This is why we’re here. I want you to bring me the tough problems and we’re going to move step by step to address them.” There wasn’t this sense of fear, but a sense of determination about how we were going to move forward.
The severity of the moment was apparent and everybody was looking at the new president to see how he was going to handle this news and he pondered and he said, “Well, I guess it’s too late to ask for a recount so we better figure out what we’re going to do about this.”
By all accounts, the first few months after the inauguration were do or die, a slew of crises that just kept coming.
When he came into office…you had an auto industry that was failing, you had wars in two countries, you had pirates, you had a tsunami that caused a nuclear reactor to go off in Japan. I mean, then you had had H1N1! It was just a whole host…there were pirates!
Those first several months were terrible. Sometimes, we’d be in a daily intelligence brief and there would be something that would strike us as, you know, unusual or scary and the president would say, “Well, this is like the third most scary thing I’ll hear today.”
Every morning you woke up, you didn’t know what was going to happen in the financial markets, you didn’t know what was going to happen in the stock market and you were behind the ball and you would go to bed very late at night feeling that you saw another day of panic and another day of uncertainty and you knew you were going to wake up behind the ball again.
The one person who held us together, the one person who kept us calm was the president. You know, on the campaign, when everything was falling apart, he said, “Go read some FDR and try to channel that into everything you write.” And when we were [in the White House] he’d say, “Let’s go out and tell the American people that what we’re doing right now is going to help and it’s going to pay off and it’s going to stabilize things, even if it takes a little bit of time.” He was always the one person who kept us calm and focused.
We would go from one meeting to the next…out of an Iraq meeting or an Afghanistan meeting [then] into an auto industry meeting to what is the stimulus going to be…[there was] no moment just to catch your breath.
It wasn’t like there was a rest…The hits kept coming and he was characteristically calm, taking it in, asking questions. Early on, with the auto issue, [I remember] the president reflecting on the fact that this industry had deep problems that were decades in the making. And so we needed to think really hard about whether this was a moment where those problems could be remedied in a more fundamental way…I think the president was starting to think about the fact that, even in the midst of crisis, maybe we could find opportunities to solve problems that were longer in the making.
We would joke sometimes that when we got out of there we were going to open up a T-shirt shack in Hawaii. We’d have one color, white; one size, medium, so if somebody came up you’d have to think white, medium and just kind of hand it to them. And we’d just watch the waves all day and we already had our shorts picked out…And somewhere in the meeting, when it was overwhelming, I’d look at him and I’d go white and he’d go medium and it was the only way to…put yourself mentally in a different place.
We were meeting all day, every day, including weekends. And I started to realize that although we had extraordinary experience, Larry Summers, Tim Geithner…Paul Volcker, Warren Buffet…that nobody knew exactly how to fix the financial system. We were making best guesses in terms of what would work.
In 2008 and 2009, millions of Americans were losing their homes, and anger against big banks and bankers was rising. According to a Harris Interactive poll at the time, only 4 percent of Americans said they had a great deal of confidence in the people running Wall Street, an all-time low.
Someone in my immediate family lost her job, and you watch your parents start to lose their savings and wonder what they're going to do about retirement. And everyone was going through that, not just the American people you're trying to serve but everyone in here, too.
The mortgage crisis…really had a negative impact on substantial numbers of people. I think people wanted to see the heads of these institutions in the dock. And to the extent that we could’ve made those cases, we certainly would have, but we simply didn’t have the ability. We didn’t have the proof that was necessary to hold people at extremely, extremely high levels accountable.
As I left the Justice Department, one of the things I said was that Congress needs to change the standards to bring these kinds of cases.
Early on in the administration, we had a meeting with the financial industry. People were giving their opinion [around] a long table in the east wing. And there’s a great picture of Lincoln above the fireplace mantle. There were about 30 people…arguing, here’s what TARP [the Troubled Asset Relief Program signed into law by George W. Bush in 2008, to purchase toxic assets from financial institutions to strengthen them] should look like. [CEO of JP Morgan Chase] Jamie Dimon’s point was whatever you do, from the Recovery Act to the auto industry to the financial sector, come in with overwhelming force to jumpstart the economy…And the whole basic approach was that we were going to just body slam the problem with the resources necessary…It doesn’t matter what the specifics are, just overwhelming force.
It was a unique period because [the president] got handed this economic crisis that was not his own doing but he’d be credited with [the outcome] or he would be blamed for it. And for a long time it was blame.
I remember being there in February of 2009 and trying to explain to the American people how the crisis happened and why the policy solutions we were proposing would work. And you have to know about credit default swaps and mortgage-backed securities and…I would sit there and talk to Tim Geithner and Larry Summers and Christina Romer and I'd have to say, “Okay, slow down, slow down, slow down. Try to say that in English.” I was sort of the go-between, figuring out how [to] explain really complicated policy issues in a way that’s easily understandable to a lot of people without seeming too simplistic.
We had a very robust debate; the kind of debate the president encouraged on issues. He wanted us to turn an issue around and look at all sides and then debate that out in front of him, present him [with] the different sides so that he had the best information to make a decision.
There was no sense [from the president] that he drew a bad hand, that the types of things he wanted to get done were now going to be harder or not possible. He just methodically dealt with it…He has a good, gallows humor, which you need during those things, but there is no, Woe is me. There’s not a lot of kicking the desk and saying, We got a bad stretch of luck or, That’s not fair. He always just says, “Okay, what are we going to do about this?”
I was still a relatively new speechwriter. I'd only been writing speeches for a year and a half, so I [was] still trying to figure out how to do that. The president was probably speaking three times a day just to try to reassure the American people…So as we’re trying to figure out our new jobs, we’re also trying to figure out how to tell the country that the president’s got this.
In January of 2009, Obama and his economic advisors began rallying Congress to support what would become the Recovery Act, a more than $8 billion stimulus package meant to jumpstart the stalled economy.
I think where I realized that we might not see the normal give and take in politics was about a month into my presidency. We were in the midst of this massive financial and economic crisis. We were trying to pass the Recovery Act, what was known as the Stimulus Bill at the time and we had canvassed economists from across the political spectrum. Everybody agreed that even though you might not normally want government to spend a lot of money, when you had the kind of crisis we had, where everybody was pulling back at the same time, banks weren’t lending, consumers weren’t spending, people were losing their jobs, housing prices were plummeting [and] the stock market had fallen so far that people were seeing their pensions evaporate, that in those moments, it’s the job of the government to step in.
When the time came to put their names on a letter in support of the Recovery Act, we could only find four Republican governors to do it. And there would be others who would say, “Yes, of course we need you to do this, but please don’t make me say it out loud.” There was this tension on that side of the aisle. Are we going to let this president be successful? Even in the face of an epic crisis, even in the face of a potential depression on the scale [of] the 1930s.
Just a few months earlier, I was there when Senator Obama, running for president of the United States, offered President Bush the support that he needed to pass the TARP, the bill to keep the financial system afloat. It wasn't popular and it wasn't easy but he felt it was his responsibility and many other Democrats did as well. Barney Frank, who was chairman of the banking committee, took this up. Nancy Pelosi and others, none of whom were enthusiastic about it, did it because they thought it was their responsibility to the country, and to the future, to do this.
On January 28, 2009, Barack Obama won House approval for the Recovery Act, without a single Republican vote.
We purposely put a mix of things [into the Recovery Act], infrastructure spending and helping to make sure teachers weren’t laid off…and we also had a big packet of tax cuts and we thought that would be appealing to the Republicans, who had consistently run on tax cuts.
I remember standing in the Oval Office. The president was getting ready to go over and address the House Republicans and make the case for the Recovery Act. And a story moved saying that they had announced they were going to vote en masse against the Recovery Act before he got to make his case.
I get word on the way up that they had just put out a press release saying they were opposed. They were opposed. They hadn’t looked at it yet and they were opposed.
That was a strong signal. [The president] said, “This isn't on the level is it?” And it wasn't on the level. There had been a judgment on the part of the Republican leadership that they had lost badly in the election. They had lost lots of seats and if they were going to get them back, better to let Obama and his big Democratic majorities in the House and Senate deal with these problems, take the unpopular decisions and run against him and them in 2010, and get some of those seats back.
That gave us a sense that the strategy that Mitch McConnell had articulated and has publicly acknowledged:“ We were just gonna oppose whatever the president offered even in the midst of crisis because if he obtained any bipartisan support that would strengthen him politically.” We saw that in action very early on, and that would continue not just through my first term but my second, as well.
We were told, “We’re not going to work with you. We want to see this president fail.”…I look at those remarks and say, “Where is the love of country?” Because this wasn’t a policy decision. [This] was an attempt to doom a presidency, a person.
It started at the very, very beginning with the passage of the Recovery Act…basically, party line vote. There wasn’t an attempt to move across the aisle…And this goes back to the idea that the president was naïve about bipartisanship. Why do you keep trying to work with people who have told you that they don’t want to work with you?
I don’t remember being that frustrated because I just don’t remember having enough time. What I remember is an overwhelming sense of dread every day that we were not moving fast enough, that we were behind the ball, and that we were one or two or three decisions away from something really terrible happening. And that really focuses the mind.
It was surprising that given how dire things were, there were only three Republicans who voted for the stimulus package. It’s pretty remarkable when you think about it…So that was the first taste. There were many more tastes after that.
For a president who feels things deeply, but is also a very logical person, it was, “How can it be that when the nation is in a crisis of this magnitude, that we wouldn’t work together to try and move the nation out of crisis?” So, yes, it started from day one.
In late 2008 and 2009, the auto industry was on the brink of bankruptcy, which could potentially lead to the loss of millions of jobs down the line. The president and his advisors were faced with a conundrum: whether the government should let them fail—or step in.
We didn't know where the president was going to land on it. Advisors were arguing on all sides. And ultimately, it was a rough several months of headlines and stories and trying to explain why it was the right decision to move forward with the auto bailout. If you look back today, people think, “Oh, that was a genius amazing moment by the president.” I have the battle scars to prove it wasn't that simple at the time.
We used to joke that the good news about working on the auto industry in particular was that everybody was so opposed to it that there was something freeing about that…Everybody hated what we were doing and so that was at least consistent.
It was very difficult to write speeches trying to convince people that the president had to take steps that everybody hated. The auto industry had been making bad decisions for years and most Americans didn't want to save the auto industry. So it’s tough to write speeches telling people, This is necessary even though I hate it. [The president] would always add into his speech, “Saving the auto industry was not on my to-do list, it was not even on my want to-do list.”
Bailing out the American auto industry had the support of 17 percent of the American people. Seventeen. The American auto industry. That’s how bad things were.
The auto industry is unique in that you have big companies GM, Chrysler, Ford, but they rely on this incredibly interconnected network of suppliers and dealers and not just the people who make the steering wheel but the people who make the part that goes into the steering wheel…Every community has dealerships and the potential cascading impact was one that we had to get our hands around. So you look at a map of where Chrysler’s operations were, towns and counties across the industrial Midwest, where this employer is their entire economic engine. That plant closes and it’s not just the 1,500 or 2,000 workers who are out of jobs, it’s the restaurant owner who provides lunch to these folks every day. It’s the auto dealers in the greater region who all of a sudden are out of a job, as well. It’s the suppliers. It has a compounding impact at a moment where our economy was already in free fall.
That was the backdrop for the president starting to propose and work with the economic team to bail out and to save the auto companies, recognizing millions of jobs [were] hanging in the balance, literally the fabric of communities in American cities hanging in the balance, and what the ripple effect would be…I think what often gets lost in our policy and political conversation is the complicated nature of these issues.
Because of the crisis, so much of the communication in those early months was just, Here’s what’s wrong and here’s what we’re doing to fix it. And that’s not always the most satisfying thing to hear.
Why is the United States involved in the auto industry? Fact is, because we demanded reforms, [we] actually solved 40, 30 years worth of issues from mileage, labor relationships, supplier issues, car sales. So there were a whole slew of issues that had been piling up and never got addressed. As some of us believe: Never allow a good crisis to go to waste.
If we had to do it over again, [and] there was no crisis, I think there would've been much more emphasis on the president using those early months to lay out his vision for the country and how he wanted to achieve that vision. And it would've been a much more cohesive narrative.
It’s something I learned early, that I’ve tried to communicate about decisions you make as president: You’re working with imperfect information. You don’t know. Nobody ever comes to you and says this is 100 percent right. They say, We think this is our best option, it might not work and if it doesn’t work then we’ll try something else but things could get really, really bad. And learning to get comfortable with making big decisions based on probabilities was something that came to me fairly quick.
Those first couple of months revealed his character in a way that I will personally remember and reflect on for the rest of my life. He was presented with the most impossible of political choices…Throughout that whole process he was calm, calmer than the rest of us. He pushed us consistently to lay out the substantive case, to dig into the issue. He wanted to know the substance. He would always say, “Talk to me about the policy, talk to me about the substance, we’ll get to the politics of this.”
He made those tough calls and, obviously, it worked out. The auto industry just had its best year ever and financial systems are stronger and more secure and TARP [was] even paid back plus money.
The auto industry is a unique and improbable success story. [It] has done better than even the most optimistic assessments that we presented to the president at the time…When it became clear that there was a choice to make, he took a deep breath and he made it and he never looked back. I personally think that demonstrates something very fundamentally strong about his character. Looking back, those decisions early on will be ones we will thank him for, that the country will recognize.