Obama Gets His Groove Back

[ Posted Tuesday, March 30th, 2010 – 17:28 UTC ]

You can call it his groove, or you can call it his mojo, or (if you're less Austin Powers-minded), you can call it his political momentum. But whatever you choose to call it, Barack Obama has emerged, phoenix-like, from the ashes of the healthcare debate rancor and is now forging ahead on many fronts. This political rebirth is not guaranteed of success in any way, but it certainly is refreshing to see, I have to say.

Today, President Obama signed the final health reform bill, but (more importantly) he signed it as a "student loan reform bill," due to House Democrats wisely sneaking this in to the reconciliation bill. This has long been a Democratic priority, and some have been fighting for it for a decade or more. From a Washington Post article on the signing, here's what the new law will do:

The bill Obama signed into law overhauls higher education financing, doubling funding for Pell grants, allowing students to borrow directly from the government and easing payment structures once they graduate. Loan repayments will be capped at 10 percent of a graduate's salary, down from the current 15 percent cap, starting in 2014. The bill, Obama said, will save the country $68 billion that would otherwise have been spent on "the middle men" -- financial institutions that previously managed the loans.

"That's real money," Obama said.

In case anyone missed the point, Obama signed the bill at the northern Virginia community college where Jill Biden is a teacher.

This bill not only doubles Pell grants, but also (if it had involved healthcare) is "single-payer" -- it removes the banks from the student loan equation altogether. What this means is that students will no longer have to pay a whopping big price to the banks just for the banks to process some forms. This obscene corporate profit has been built in to what was always a government system in the first place, and it serves no purpose whatsoever (unless you count "corporate welfare for banks," which I do not). As an added bonus, it makes it easier for students while they pay their loans off.

This is the sort of thing that has a multiplier effect politically. While the media has barely paid any attention to this rider to the health reform bill, it is going to change things for the better for millions of students. "Ah," I hear you say, "but the students already love Obama, so who cares?" But that ignores the multiplier -- the parents. Most college students have parents who are involved in the tuition process. Call it the "First Bank of Mom and Dad." And these are largely middle-class parents who would appreciate a break for their college-age children. The demographic this will help is huge, and can honestly be called "Main Street."

Obama has set himself up defending these Main Street folks, against Wall Street bankers. This is a preview of the upcoming battle over Wall Street reform -- the next big issue on the Senate's plate, and one which Obama appears eager to take on. From the president's bill-signing remarks today:

But what's gotten overlooked amid all the hoopla, all the drama of last week, is what happened in education -- when a great battle pitting the interests of the banks and financial institutions against the interests of students finally came to an end.

You see, for almost two decades, we've been trying to fix a sweetheart deal in federal law that essentially gave billions of dollars to banks to act as unnecessary middlemen in administering student loans. So those are billions of dollars that could have been spent helping more of our students attend and complete college; that could have been spent advancing the dreams of our children; that could have been spent easing the burden of tuition on middle-class families. Instead, that money was spent padding student lenders' profits.

Now, it probably won't surprise you to learn that the big banks and financial institutions hired a army of lobbyists to protect the status quo. In fact, Sallie Mae, America's biggest student lender, spent more than $3 million on lobbying last year alone.

But I didn't stand with the banks and the financial industries in this fight. That's not why I came to Washington. And neither did any of the members of Congress who are here today. We stood with you. We stood with America's students. And together, we finally won that battle.

President Obama may be in the midst of a "pivot" on the whole question of Wall Street. Rumors have been around since Christmas that the Obama administration is really annoyed at the perception that they're in bed with Wall Street. To change this perception, however, Obama needs to actually fight Wall Street. His statement today certainly sounds like he's embraced a new willingness to do so. Which will be important during the upcoming Wall Street reform debate in the Senate. The White House is already signaling that they are not open to compromise on their goals for this bill, which include a strong new consumer fiscal protection agency. Further adding to this change in viewpoint is how Paul Volcker is being newly listened-to in the corridors of the White House.

Republicans are already showing nervousness over having this debate, making it a wonderful election-year time to have it. Standing up for Wall Street, and against consumers, is not exactly a popular idea out in the electorate right now. But that's the position Republicans will have to take to oppose the president. Republican senators are going to have to choose between the rock of defending Big Banking, and the hard place of handing the president a political victory right before an election. And it's going to be much harder to spin for Republicans than the health reform debate was.

Add to this the fact that President Obama is feeling feisty towards Congress already, as shown by his first-ever recess appointments over the weekend. This sort of thing is done by every president (of either party), but it is a serious slap in the face to the Senate every time it happens (and this time is no different).

If Congress can manage to give Obama another big political victory, and can manage to at least make the attempt to fix what went wrong with our financial system before the campaign really heats up, then Democrats are going to be in a much better position come November. They need to also pass a few job-creation bills, for the good press it will garner them (these bills likely won't do much good, but neither will they do much harm, as they'll likely be fairly small, money-wise).

For the next month, though, Obama's prospects look pretty good. Health reform is going to fade as the overriding issue in Washington, and the public's attention will be drawn to other things. Obama conveniently has a few good ones lined up. The first will be signing a nuclear arms reduction treaty with Russia. This is a major foreign policy accomplishment for Obama, and will likely be mentioned as one of the two or three biggest foreign policy achievements of his term in office. And he seemingly put it all together while nobody was paying it much attention. The second big boost to Obama will be stories about soldiers coming home from Iraq (which have already started on the mainstream media, and will be a background for the next few months or so).

President Obama indeed seems to have gotten back his mojo, or gotten back into a much better groove. He is feeling feisty towards Congress, and he is feeling feisty towards banks. While his timeline for Wall Street reform getting through both houses is a tad bit optimistic (as they always are), he still stands a very good chance of signing such a bill into law before the fall's campaign season. Today, he signed a bill which will help millions of middle-class Main Street families out in the near future. In his spare time, he has negotiated the biggest nuclear arms reduction treaty in decades. If the economic numbers continue to improve (as most economists are now predicting), it could drain away some of the anger out there. All in all, it is looking like Obama is not going to sit on the laurels of having passed health reform, and instead will be out there leading his party to do even more of the agenda which got him elected. And, like I said, this is indeed refreshing to see.


-- Chris Weigant

Follow Chris on Twitter: @ChrisWeigant


10 Comments on “Obama Gets His Groove Back”

  1. [1] 
    akadjian wrote:


    This is great to see. It's like Keanu in the Matrix learning how to fight. Keep emphasizing the benefits. Keep getting the details out to folks - the ones they agree w/ once they get past the screaming talk show hosts. And keep emphasizing how Republicans have not been willing to work together in any way.

    If they stick with this playbook, I like their odds.

    As a big fan, I'm also interested in seeing what the corporate noise machine churns out next to try and hide any details. Will it be another Reverend Wright? Will it be better than a phony birth certificate? Will it be more powerful than false accusations of socialism?

    C'mon folks. Let's get creative.


  2. [2] 
    Michale wrote:

    What this means is that students will no longer have to pay a whopping big price to the banks just for the banks to process some forms.

    Yea, now the students will have to pay a whopping big price to the government..

    It will also put the government in control of educational purse strings..

    And ya'all think this is a good idea.... WHY exactly??

    As to the rest.... NO WHERE has Obama touched on the issues of JOBS, even though his SOTU address said that would be his "TOP PRIORITY"..

    Why do you think that is?? Maybe because he wants to keep Americans poor and dependent on the government??

    I dunno... No other reason is as logical as that one..


    And keep emphasizing how Republicans have not been willing to work together in any way.

    Republicans have clearly shown the country that they can work together.. But they CAN'T work with Democrats who insist on pursuing the Dem agenda by hook or by crook..

    And the independents in this country (like me), the ones who REALLY decide elections have clearly said they DON'T want Republicans to work with Democrats until such time as Democrats remember who THEY (Dems) work for..

    The Democrats work for us, the American people.

    The Democrats seems to have forgotten that fact...

    How else can you explain Democrats forcing legislation that 75% of Americans are against?


  3. [3] 
    akadjian wrote:

    Hey Chris - did you change the comment field or is it just me? It is now showing up very tiny in both Safari and Firefox on my Mac? Sorry for the IT interlude.
    Or maybe this is a good idea to limit our rants? :)

  4. [4] 
    Michale wrote:


    Well, glad to see it wasn't just me.. :D


  5. [5] 
    BashiBazouk wrote:

    Trippy... On Safari on a Mac the reply window is tall and super thin but there is a corner that can be pulled out to make the window bigger than normal. The text flow is funky when pulled out to max though normal when pulled out to about the posted comment width.

    On Firefox on a Mac it's small with without the ability to pull out the corner...

  6. [6] 
    BashiBazouk wrote:

    Wow. The window can be stretched down to take up the entire screen (at least on a laptop).

  7. [7] 
    Michale wrote:

    It's the same small size in either Firefox or IEX 8 on a Winblows 7 Machine.


  8. [8] 
    Chris Weigant wrote:


    Better now?

    Sorry, was testing last night and forgot to "roll back" the test code. Still working on the comments in general, so PLEASE PLEASE let me know if things like this happen. Thanks for the feedback, everyone.

    The entry window should be fixed now, let me know if it isn't (you may have to reload the page to update it).


  9. [9] 
    Chris Weigant wrote:

    Michale -

    Students will now pay LESS than before. The banks were just skimming off the top, for shuffling paperwork. The government has always backed these loans, so there's no difference there, the only difference is that now the students will file the paperwork directly with the government, instead of paying a bank thousands of dollars for filing the form for them. The banks are still free to compete for the loan business, but the loans they offer aren't backed by the government (they've always been free to do this, by the way). So not much of anything has changed, except saving $68 billion that used to go to banks, for doing very little at all.


  10. [10] 
    Michale wrote:

    Students will now pay LESS than before.

    That's what the government tells us...

    Forgive me if I don't accept it at face value..

    I just don't think it's a good idea to have the US Government making decisions on who get's funds for education..

    Imagine years from now when we have a GOP administration and, all of the sudden, you see school funding dry up for, say "liberal arts" studies or the like....

    If the government gets the final word on who get's money for college, what's to stop the government from making sure that only "approved" education get's the funds??


Comments for this article are closed.