TOPICS > Politics

Shields and Brooks on Obama’s Response to McChrystal, Wall Street Overhaul

June 25, 2010 at 12:00 AM EDT

JEFFREY BROWN: And now to Judy for our weekly political analysis.

JUDY WOODRUFF: And that is the analysis of Shields and Brooks, of course, syndicated columnist Mark Shields and New York Times columnist David Brooks.

The big story of the week, General David McChrystal — Stanley McChrystal.


JUDY WOODRUFF: Stanley McChrystal, and what he and his staff said, Mark, about the president and a lot of the civilian leadership. What do you make of this?

MARK SHIELDS: Well, I mean, it was a totally unexpected, out-of-the-blue crisis that hit the president, hit the White House, hit the administration.

And, in a strange way, because the president did, I think, handle it in a deft and sure-footed way, it could actually end up enhancing his position and his strength and certainly burnished his credentials, which needed burnishing, as commander in chief.

I think beyond that, Judy, it was an example of, to me anyway — of General — his putting in General Petraeus was a perfect answer, I mean, a perfect replacement, in the sense that he is substituting someone who is well-known, well-liked, well-regarded, and popular for somebody who is not nearly as well-known, in General McChrystal, and whose policy and practices were coming under increasing criticism.

So, it’s bought them some time. It is not the answer to the problem. And — but it is a — it’s a remarkable development, and I think, in a strange way, the president comes out of it stronger than he went in.

JUDY WOODRUFF: But, in terms of what McChrystal said and the people around him said, could President Obama have kept him on?

DAVID BROOKS: No. Once it became public, it became a challenge to the president’s authority. And I think he had to do what he did. And I thought he handled it beautifully.

But let’s just say, this wasn’t a substantive problem, that Stanley McChrystal had excellent relations with the White House, excellent relations with people in the State Department and the people he was complaining about, excellent relations with Karzai, who made a bid for him stay.

And, so substantively, in the official performance of his duties, he did a very good job and was widely regarded as a very successful general. It’s just that he happened to shoot his mouth off in front of a reporter and some of the time while drinking. And so it was simply that he happened to shoot his mouth off.

Now, the president handled it very well, did what he had to do, got Petraeus in there. But I have trouble believing that getting rid of a very successful general is in any way a good thing. I mean, it’s a bad thing, in that he had a very effective decision-making process in Kabul. And Petraeus is a great, a great general, and it’s a great act of service for him to really accept the demotion to do this job for the country’s need.

Nonetheless, it can’t be a good thing to lose a successful general.

JUDY WOODRUFF: But, Mark, you’re saying you don’t think this changes anything in terms of Afghanistan.

MARK SHIELDS: No, I think the policy, the policy differences between them are negligible or aren’t even existent.

I disagree with David on General McChrystal. I think what — first of all, the president had to act. He didn’t have a choice. He has looked unable to act in the Gulf, and understandably so, to cap that well. So, he had to act here.

And General McChrystal left him no alternative. This was an act of such insubordination. I disagree, in the sense, Judy, that to me it was a terrible indictment of General McChrystal and his closest aides, these remarks.

What they reflected was, A: a sense of their own indispensability. Secondly, it reflected incredible obtuse obliviousness to how those remarks were going to be received in the civilian life. I mean, I think it showed an insularity…


JUDY WOODRUFF: How is that different from what David was saying?

MARK SHIELDS: Well, I think it’s different in the sense that General McChrystal crippled himself as a general and his — his — tarnished his own reputation, credentials and credibility, by allowing an environment to develop around him where his staff felt totally comfortable to do this.

Once he said the president looked uncomfortable and ill at ease in the presence of military brass, his fate was sealed.

JUDY WOODRUFF: You don’t see it that way?

DAVID BROOKS: Well, I do think the president did the right thing. And I think he had to get rid of him.

But — and I do think that what McChrystal and particularly his aides, who were really the worst offenders, said was immature and stupid. But, to be honest, people in Washington, at night, especially over a beer, especially in Paris, say stupid and immature things and complain about people, and then they go out in the course of the day and they work with those people.

And, to me, we’re at a stake where we ignore the official duties too much and the success of those duties, and we pay so much attention to the off-hour social drama. You know, I think it’s unfortunate. In this case, once it became public, he had to go.

But the larger issue is what’s going to happen in Afghanistan.


DAVID BROOKS: And Mark’s right. McChrystal and Petraeus are the two authors of the COIN strategy, the same approach. And it’s still a strategy that is in some trouble.

I thought nominating or appointing Petraeus was like an apology to George Bush and Dick Cheney, because it’s an acknowledgement finally that Petraeus’ strategy with the surge actually worked, which the administration is slow to acknowledge.

JUDY WOODRUFF: Which was something that Barack Obama had said — had been critical of.

DAVID BROOKS: Right. And, in private, I think they knew it worked. In public, they can’t say it. But it clearly worked.

But, nonetheless, there’s no question. Even people who think Petraeus is a great general, who think that COIN is the right strategy, Afghanistan is in trouble. And it’s in trouble in part because the Afghans don’t seem to be fighting for their country as hard as the Americans are fighting.

And it’s in trouble because Karzai and many other people think, well, the Americans are leaving in July 2011. They’re probably not going to beat the Taliban. I have got to make my own arrangements.

And so there is a failure of military success. There is certainly a failure of civilian backup. And there’s also doubts about American will. And that’s — that — those doubts, the third issue there, comes out of the divisions with the administration is, are we going to stay past July ’11 or are we not? And those seem to be open questions within the administration.

JUDY WOODRUFF: Open questions.

MARK SHIELDS: Yes. I mean, I think that that is a real question.

General Petraeus did re-commit to the July 2011 date this week in an interview. But, at the same time, Judy — if that’s when it begins, withdrawing, even if there’s just symbolic withdrawals at that point, if it continues into 2012, then — then it becomes not only simply a problem for the United States, for the troops who are fighting there, but it becomes a political problem for Barack Obama running for reelection, having — having made that pledge that the withdrawal would begin.

JUDY WOODRUFF: But the president himself made clear it was a soft date just yesterday.


MARK SHIELDS: The president had said it was a soft date.


MARK SHIELDS: He’s trying to, obviously, get some wiggle room on it.

But, I mean, politically, that would be a problem if, in the summer of 2012, there is not significant, positive progress, that there isn’t some sense of a governable nation, that — that this isn’t the graveyard of empires, which we have learned from Alexander the Great, through Genghis Khan, through the British, and the Russians, that that’s what Afghanistan has been.

JUDY WOODRUFF: Financial reform. We’re going to completely change the subject.


JUDY WOODRUFF: They did — the conference committee came out with an agreement, a consensus of sorts last night, although it was divided on party lines. They have come out with something.

David, what do you make of this? Is this going to address the problem that pretty much everybody sees exists in our financial sector?

DAVID BROOKS: Yes. Well, as Jeffrey’s segment illustrated, it has got a million working pieces.

I guess my bottom line is that I think the financial regulators in this country, along with everyone else, missed the buildup to this last financial crisis. They just missed it, like everyone. And expecting them to be ahead of the game next time seems to me illusory. I don’t think they’re that smart.

No one is that smart, to be able to anticipate a coming financial crash and prevent it. And a lot of that onus is being put on regulators. Second, I think financial — the financial markets are so complicated and so dynamic, I would like to have seen a financial reform with a few simple rules, raise the caps — raise that — reduce the amount of leverage that can be out there, maybe shrink the size of the banks, a few simple things.

But this bill, which is so complicated, goes in the exact opposite direction. It puts a lot of discretion on regulators to get intricately and in a complicated manner involved in our financial markets and in corporate governance.

And asking them to, A: anticipate future crises, and, B: to micromanage markets in this very complicated way strikes me as almost hubristic, that it’s a recipe for problems. And experts think there’s a lot of good stuff in this bill, and I accept that, but it certainly is putting a lot of faith in regulators.

JUDY WOODRUFF: Well, the banks were relatively happy with it. It was better than they expected.

MARK SHIELDS: I’m not sure, Judy. They certainly fought provisions in it very hard. And I think we don’t say many good things about this Congress. And I think this is one where leadership in the both the Senate and the House, Chris Dodd, retiring senator from Connecticut, and Barney Frank, un-retiring Democratic House chairman from Massachusetts…


MARK SHIELDS: … really deserve credit. It was a Dodd-Frank. It was an interesting pairing.

Even with the wind at their backs politically, because they were opposing the big banks and everything else, there was enormous political and economic power to dilute and diminish what they were about. And I think what they have accomplished is significant.

Obviously, it enhances the president’s hand as he goes to the G20 in Toronto. Unlike his trip to Copenhagen, where he went without any prospect of an energy, climate control bill to the last conference, I think he’s in an enhanced position now to request, demand, insist upon similar measures by our allies.

JUDY WOODRUFF: I’m just referring to what the markets — the markets having gone up today, and the credit was being given to the fact that banks felt this was better than what they could have expected.


JUDY WOODRUFF: But does this prevent another meltdown?

MARK SHIELDS: Does it prevent — I think it certainly is a vast improvement. Whether in fact it does — it doesn’t guarantee a meltdown. We never — you know, we can’t do that.

But I think there is regulation. I’m glad there’s a consumer protection element to it. I’m glad there’s the requirement the Volcker rule. I think there’s strong and enlightened provisions. David is right. It’s not a perfect piece of legislation.

If we waited for that, it will never pass.

DAVID BROOKS: But the leverage is — you can still go super-leveraged. Banks can still take a lot of risks. And some of the hedge fund guys who want a lot of these markets brought out into the open said that it brings two-thirds them out of the open, so people can actually see some transparency there.

But then there’s some holes in the regulation, so the money will just flow into those holes, and they will grow, and they will become even more potentially dangerous than before. So, I still think there’s a lot of danger out there.

JUDY WOODRUFF: Just quickly, what we were just talking with Lori Montgomery of The Washington Post about, and that is the Senate not agreeing to extend unemployment benefits. Does this matter in the scheme of things right now?

MARK SHIELDS: It certainly matters to 200,000 a people a week who are going to lose it, 1.2 million starting to lose those unemployment benefits. It’s a political defeat, yes, for the administration, for the Democrats, but it’s also an economic setback, Judy.

This is — part of the recovery, I mean, is to sustain consumer demand and to sustain people who are in this terrible plight. Republicans have obviously made a guess, a bet. And that bet is that the concern, public concern about the debt trumps teacher salaries, firefighter salaries, and unemployment insurance.

DAVID BROOKS: Yes, we should cut deficits. On the other hand, we shouldn’t be cutting off unemployment benefits when there are no jobs out there. So, I hope what Olympia Snowe is suggesting goes through, that they separate that out, and they pass that one.

JUDY WOODRUFF: And vote on that alone.

DAVID BROOKS: Right, because I do think the larger concern about the debt is a right concern.

There is a larger debate. Should we now be, in this circumstance, be stimulating more, or should — is it now time for a little austerity? That’s a legitimate intellectual debate. I’m a little more on the austerity — but on the specific matter of unemployment insurance, I think we need that.

JUDY WOODRUFF: Well, we need to see both of you every Friday, and we thank you for being here.


JUDY WOODRUFF: David Brooks, Mark Shields.

DAVID BROOKS: Thank you.

MARK SHIELDS: Thank you.