Obama's Priority: Chief of Staff, Treasury Secretary
Obama Starts Shaping His Team, Offers Rahm Emanuel Top Spot
By MARK MOONEY
Nov. 5, 2008 —


The jubilant crowd of an estimated quarter-million people had barely cleared out of the victory party in Chicago when President-elect Barack Obama began shaping his administration.

Obama offered the job of chief of staff to Rep. Rahm Emanuel, ABC News' Jake Tapper reported today.

Emanuel, a veteran of President Clinton's administration and a close political ally of Obama's from Chicago, hasn't immediately given his answer.

Obama likes that Emanuel knows policy, knows politics and knows Capitol Hill and has told associates that he knows Emanuel will "have his back," ABC News' chief Washington correspondent George Stephanopoulos said of the offer.


Pausing to Celebrate, Obama Looks Ahead
Obama didn't have time to savor his history-making victory over Republican John McCain that made him America's first black person to win the White House.

The Illinois senator amassed 338 electoral votes to McCain's 162, although three states -- Missouri, Indiana and North Carolina -- remain too close to project.

In a Rose Garden statement today, President Bush congratulated Obama on his "impressive" victory and noted the historic significance of electing the country's first black president.

"No matter how they cast their votes, all Americans can be proud of the history that was made," Bush said.

"It will be a stirring sight to watch Barack Obama; his wife, Michelle; and their two beautiful daughters step over the threshold of the White House," he said.

The president acknowledged "we are embarking on a period of change in Washington" and promised his "complete cooperation" in the transition in the next two months.

The sweeping triumph, which included winning six states that had voted Republican in 2004, triggered euphoric crowds to turn out in Chicago, where Obama claimed his victory, as well as in New York City's Times Square and Harlem, and on Pennsylvania Avenue in Washington, D.C.

By the time the dancing in the streets had ended, names were being bandied over the airwaves about whom Obama would name to his Cabinet.

The president-elect has signaled that he will rely heavily on former members of Clinton's administration and that he plans to include several Republicans on his team.

His transition team will be headed by Clinton veteran John Podesta, his current Senate chief of staff Pete Rouse, and Obama confidante Valerie Jarrett. Tapper reports that the team will include former Clinton Cabinet members William Daley and Fredrico Pena, as well as Arizona Gov. Janet Napolitano.

Obama intends to quickly settle on a secretary of treasury to help bring stability to the country's shaky economy.

"If people think there is a direction, a vision, a plan that we're moving forward, you can change the psychology, help the markets to settle down," Clinton's former chief of staff Mack McLarty told "Good Morning America."

Timothy Geithner, president of New York's Federal Reserve Bank, and Larry Summers, the former treasury secretary in the Clinton administration, are believed to be the leading contenders.


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Obama Intends to Have Some Republicans in Cabinet
"We're going back to an old role for secretary of treasury where they are the chief economic spokesman and chief economic formulator," Ken Duberstein, President Reagan's former chief of staff, told "GMA."

Stephanopoulos said that Obama is also likely to appoint an emergency economic committee that could include heavyweights like former Treasury Secretary Bob Rubin; former head of Clinton's council of economic advisers Laura Tyson; maybe former Federal Reserve Board chair Paul Volcker; and maybe even billionaire investor Warren Buffett.

Nevertheless, American and European markets fell slightly Monday morning and U.S. markets fell upon opening.

There is pressure on Obama to quickly designate other top spots and he is expected to move fast to designate secretaries of defense and state.

"Campaigns are long and arduous. Transitions are fast and chaotic," McLarty said.

"He needs to put everything in place so that he can hit the ground running on Jan. 20," Duberstein said.

Obama is expected to move quickly to name three or four top spots in his administration: chief of staff and the secretaries of treasury, defense and state.

Stephanopoulos reported that Obama is also committed to having Republicans in his administration and that he will likely reach out to McCain to find some issues they can work on together.

Defense Secretary Bob Gates is expected to be asked to stay on the job.

"It would make good sense for our country and the beginning of an Obama administration," Duberstein said.

Republican Sen. Chuck Hagel may be a backup contender for the job.

Republican Sen. Dick Lugar is believed to be on a short list for secretary of state, but he must contend with the ambitions of Massachusetts Sen. John Kerry and New Mexico Gov. Bill Richardson.

dienekes96 wrote:Who he picks as SecState is irrelevant. Biden will be more qualified than anyone else.

dienekes96 wrote:
I agreed with JFraz on Emanuel. He's the political equivalent of the Hollywood version of his brother - Ari from Entourage. He's a strongly partisan attack dog whose primary goal is Help The Democrats. He is their own (less powerful) version of Cheney. He pushed people into line as well. But he might be a good foil if Obama is really and seriously going bipartisan.

Obama Mines Clinton Staff to Fill First Staff Jobs
After Only Two Appointments, Republicans Question Obama's Commitment to Change
By RUSSELL GOLDMAN
Nov. 7, 2008—


In one of his first acts since being elected president, Barack Obama called on two former Clinton administration staffers to head his transition team and serve as chief of staff.

After a nearly two-year campaign, President-elect Obama has 77 days to hand-pick a Cabinet and advisers to help set and carry through his agenda -- a difficult task made all the more difficult by his interest in maintaining his campaign promise to change the culture of Washington.

As an indication of how tough that change might be, Obama's initial appointments of former Bill Clinton Chief of Staff John Podesta to oversee his transition and former Clinton policy adviser Rep. Rahm Emanuel are being hailed by some as the right picks for the jobs and derided by others as more of the same.

"You can look at these choices in two ways," said ABC News political consultant Torie Clarke, herself a former Pentagon spokeswoman. "Barack Obama doesn't want to make the same mistakes Clinton made by not having enough experienced people on board. Obama needs seasoned hands who know Washington.

"On the other hand and, I think, more profoundly, there are some Republicans, Independents and moderates who believed him when he said, 'I want to change the culture. I want to reach across the aisle and have people representing different points of view in my administration.' It is still early and there are more choices to make," she said. "People are going to be watching very carefully because it's difficult to imagine a more partisan choice than Rahm Emanuel," an Illinois congressman.

In addition to Podesta and Emanuel, a number of former Clinton staffers and Cabinet members have been named to the transition team, and three of the four names being floated as a potential treasury secretary have roots in the Clinton White House.

The senior staff and advisery board of the transition team include 10 former Clinton officials, including former Commerce Secretary William Daley and Frederico Pena, who served as both secretary of transportation and energy.


Obama's Advisors and Cabinet
"The president-elect has to put together a team of the best people he can find who are like-minded that he can trust them to follow through on his orders," said Stephen Hess, a senior fellow at the Brookings Institution who worked in the Eisenhower, Ford and Carter administrations and recently wrote a primer on presidential transitions called "What Do We Do Now?"

"The president-elect shouldn't be worried about how his decision is going to play in the media or on Capitol Hill," he said. "Podesta has been putting together information on the transition in a comprehensive and serious way for a while. He is a logical person to move ahead with planning. You want someone who has been there and, as a former chief of staff, he gets the White House."

The selection of Emanuel, a practitioner of no-holds-barred politics who's a veteran of Clinton's bitter battles with the "vast right-wing conspiracy" and impeachment proceedings, has already rattled some Republicans.

"This is an ironic choice for a president-elect who has promised to change Washington, make politics more civil, and govern from the center," said House Republican leader John Boehner, R-Ohio.

Republican National Committee spokesman Alex Conant echoed Boehner's sentiment.

"Barack Obama's first decision as president-elect undermines his promise to 'heal the divides,'" Conant said. "The White House needs a chief of staff, not a chief campaigner like Emanuel."

Emanuel was instrumental in organizing much of the success House Democrats saw in 2006, but he has a reputation for being a partisan tough.

"He has a hard edge, but Obama doesn't need someone with a soft touch," said Donna Brazile, an ABC News political consultant and Democratic strategist.

That the Republicans don't like Emanuel should matter little to the president-elect, said Republican strategist Ed Rollins, who served in the Reagan White House.

"The Republicans don't matter," he said. "They're in the wilderness and they're unimportant to the new president in terms of moving his legislation forward."

The president appoints about 3,000 employees but few picks are as important as whom he selects as his chief of staff, Hess said.


New President's Chief-of-Staff
"The chief of staff is the most important advisor the president has," Hess said. "It's not his job to make people happy; it's his job to make sure the trains run on time. It has nothing to do with change or no change. It has nothing to do with old guard, new guard, top guard, bottom guard. His job is to make sure the president's programs are moving forward."

Hess said that Ronald Reagan had one of the smoothest transitions, Clinton and Jimmy Carter had two of the worst.

In an attempt to distance himself from Richard Nixon and Gerald Ford by not hiring Washington insiders, Carter looked to old associates in Georgia. As his congressional liaison he appointed Frank Moore, whose only prior experience had been lobbying the legislature in Atlanta.

Clinton, in his memoirs, admitted he spent so much time "micromanaging the Cabinet appointments" that he didn't appoint his first chief of staff Leon Panetta until six days before the inauguration.

One chair at the Cabinet table that might remain intact and in the hands of a Republican is the one occupied by Defense Secretary Robert Gates.


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Emanuel Was Director Of Freddie Mac During Scandal
New Obama Chief of Staff, Others on Board, Missed "Red Flags" of Alleged Fraud Scheme
By BRIAN ROSS and RHONDA SCHWARTZ
November 7, 2008—


President-elect Barack Obama's newly appointed chief of staff, Rahm Emanuel, served on the board of directors of the federal mortgage firm Freddie Mac at a time when scandal was brewing at the troubled agency and the board failed to spot "red flags," according to government reports reviewed by ABCNews.com.

According to a complaint later filed by the Securities and Exchange Commission, Freddie Mac, known formally as the Federal Home Loan Mortgage Corporation, misreported profits by billions of dollars in order to deceive investors between the years 2000 and 2002.

Emanuel was not named in the SEC complaint (click here to read) but the entire board was later accused by the Office of Federal Housing Enterprise Oversight (OFHEO) (click here to read) of having "failed in its duty to follow up on matters brought to its attention."

In a statement to ABCNews.com, a spokesperson said Emanuel served on the board for "13 months-a relatively short period of time."

The spokesperson said that while on the board, Emanuel "believed that Freddie Mac needed to address concerns raised by Congressional critics."

Freddie Mac agreed to pay a $50 million penalty in 2007 to settle the SEC complaint and four top executives of the Federal Home Loan Mortgage Corporation were charged with negligent conduct and, like the company, agreed to settle the case without admitting or denying the allegations.

The actions by Freddie Mac are cited by some economists as the beginning of the country's economic meltdown.

The federal government this year was forced to take over Freddie Mac and a sister federal mortgage agency, Fannie Mae, pledging at least $200 billion in public funds.

Freddie Mac records have been subpoenaed by the Justice Department as part of its investigation of the suspect accounting procedures.

Emanuel was named to the Freddie Mac board by President Bill Clinton in 2000 and resigned his position when he ran for Congress in May, 2001.



Freddie Mac Misrepresented Income, Says SEC
During the years 2000, 2001 and 2002, according to the SEC, Freddie Mac substantially misrepresented its income to "present investors with the image of a company that would continue to generate predictable and growing earnings."

The role of the 18-member board of directors, including Emanuel, was not addressed in the SEC's public action but was heavily criticized by the oversight group (OFHEO) in 2003.

The oversight report said the board had been apprised of the suspect accounting tactics but "failed to make reasonable inquiries of management."

The report also said board members appointed by the President, such as Emanuel, serve terms that are far too short "for them to play a meaningful role on the Board."

As a Congressman, Emanuel recused himself from any votes dealing with Freddie Mac until just this year.

In dealing with the nation's economic crisis, the new White House chief of staff will almost certainly be involved in discussions about the house and mortgage markets.

Emanuel's spokesperson said, "As White House chief of staff he will work with President-elect Obama and his economic advisers to help ensure we protect taxpayers and homeowners."

Click Here for the Investigative Homepage.


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DarthDiggler wrote:
The Federal Prosecutor in Chicago has been slowly taking down currupt elements of the Illinois political establishment. There has been significant pressure from both Democrats and Republicans to have him removed because of this. The thing about Illinois is that it is so corrupt, top to bottom, that both sides are infested. McCain was asked by the Tribune if he would remove the Federal Prosecutor and he said point blank he would not. Obama only said the guy was doing a good job and wouldn't commit. If he is removed, as he is moving up the ladder to Daley and the Illinois Governor, it would be the clearest signal that Obama is all talk and is beholden and controlled by the Chicago style politics from which he sprang.

dogma wrote:

DarthDiggler wrote:
The Federal Prosecutor in Chicago has been slowly taking down currupt elements of the Illinois political establishment. There has been significant pressure from both Democrats and Republicans to have him removed because of this. The thing about Illinois is that it is so corrupt, top to bottom, that both sides are infested. McCain was asked by the Tribune if he would remove the Federal Prosecutor and he said point blank he would not. Obama only said the guy was doing a good job and wouldn't commit. If he is removed, as he is moving up the ladder to Daley and the Illinois Governor, it would be the clearest signal that Obama is all talk and is beholden and controlled by the Chicago style politics from which he sprang.

It isn't anywhere near that simple. Patrick Fitzgerald got his seat thanks to former GOP Senator Peter Fitzgerald, who wanted someone from outside the Illinois system; ostensibly as a means of rooting out corruption. The reality is that Patrick Fitzgerald was given an indefinite extension in his tenure by Republicans then in office because he was part of ongoing investigations of members of the Democratic party and dissident Republicans. US Attorneys are normally appointed to the position for a term of 4 years; primarily to prevent the office from becoming a retread of J. Edgar Hoover.

Corruption really isn't that big of a deal in Chicago; that's more of a popular misnomer supported by recent shenanigans like "licenses for bribes." Sure, there's some impropriety in a few spots, but it's largely minor and has more of a positive effect on the political process than negative. That's the price of running a major city, wheels need to be greased so that they keep turning.

DarthDiggler wrote:
Once again your innane babbling shows you know little to nothng about the topics you choose to respond to. Illinois big wigs are dropping left and right in this state. Not the ones in front of the camera who are elected, the important ones behind the scenes. The heat on elected officials is growing each day. You claim corruption is not that big of a deal, however we have one Governor behind bars and another facing 2 Federal Investigations which have produced 3 indictments, two guilty pleas and 1 conviction.

DarthDiggler wrote:
That's 6 guys right now and it keeps going up the ladder. In federal prison in Minnesota is the former head of the Chicago Water department. He was convicted of bribery. Two years ago at the trial of Daley patronage chiefs, who were convicted of running a patronage army of city workers, paid for by the city who worked to get the mayor and his allies elected, the water department guy testified he was ordered to put this army on the streets to get Emanuel elected. What does that mean? It means driving people to the precincts to vote for who you tell them to. It means having guys stand at the door of precincts and make sure you are the 'right person' to vote today. It is a lot of dirty tricks which every Chicagoan knows about and knows happens each year.

DarthDiggler wrote:
City Alderman have been convicted of giving zoning code changes to those buisness people who contribute the most to their coffers. The head of the Cook County Board was up for reelection. He had a close primary race. A few weeks before the primary election he had a stroke. He was kept secluded in a hospital and out of the public eye. His 'people' read prepared statements from him claiming he was fine and would not back out of the race. No one ever saw him. After he won the primary it weas leanred his stroke was massive and life threatening. He had been in and out of coma the whole time. Since he won the primary he designated his son to run in his place against the republican. When confronted by reporters his son produced a hand written note from his father saying this is what he wanted. The note was written like a 2 year old would write with a crayon. No sentences were in straight lines, letters trailed off words and little of it made sense or was spelled correctly. Guess what happened? The kid got elected and his Dad dies shortly after.

DarthDiggler wrote:
The stories go on and on and on. They are endless. This is the most corrupt city in the most corrupt county in the most corrupt state. Fitzgerald can not be bought nor intimidated. The past federal prosecutors always turned a blind eye to these dealings. It has come out in trial that Illinois officials have begged Washington to remove him. They want someone who they can control. Someone who will just go after the token patsy and leave the top dogs alone. This can not be allowed to happen.