The New New Deal by Michael Grunwald

administration how to handle everything from terrorist threats to the Federal Trade Commission. 87 His own book, The Power of Progress , included a draft inaugural address for the next Democratic president. 88 And he had learned what not to do by watching the Clinton transition, which bogged down after its first two directors quit to accept cabinet positions. Podesta told Obama he’d run the shadow transition and the official transition but wouldn’t accept a permanent job.
    Still, Obama loyalists feared that while they were working around the clock to beat McCain, Podesta would be building the architecture for a new quasi-Clinton administration. He never did much to dispel those fears. For example, he recruited President Clinton’s EPA head, Carol Browner, to run an energy and environmental policy team; she later became Obama’s White House energy and climate czar.
    “That’s when the old guard started taking over,” grouses one Obama campaign aide.
    The shadow transition’s economic policy team was a case in point. It was a Clinton reunion, led by Bill Daley, a Clinton commerce secretary who would later become Obama’s second chief of staff, and Josh Steiner, a Clinton Treasury official. It also included Jack Lew, a Clinton budget director who would be Obama’s third chief of staff; Doug Elmendorf, a Clinton Treasury economist who had replaced Furman at the similarlyincestuous Hamilton Project, and would soon replace Peter Orszag at the Congressional Budget Office; and Jonathan Orszag, a Clinton White House economist who was Peter’s brother. Dan Tarullo, another Clinton economist, and Karen Kornbluh, another Clinton Treasury veteran, were the only representatives from Obamaworld. Robert Greenstein, the founder and longtime head of the liberal Center for Budget and Policy Priorities, was the only team member who hadn’t served under Clinton. At an early meeting, Greenstein, a bearded, bespectacled budget analyst out of central casting, endured some ribbing because his PowerPoint slides weren’t formatted like everyone else’s.
    “Guys, I wasn’t in the Clinton White House!” he responded.
    Podesta ordered the shadow economic team to avoid contact with the campaign, which had more pressing work that fall. (Biden didn’t even want to hear about the shadow transition; he was afraid of jinxing the election.) And since secrecy was a must—publicity would make Obama look like he was already measuring the White House drapes—the team didn’t do much outreach, either. Its only sounding board was an advisory committee of even more familiar Clinton-era faces: Rubin, Summers, Reich, Clinton economic adviser Laura Tyson, Lew, who doubled as an official team member and unofficial wise man, and just one outsider, Xerox CEO Anne Mulcahy.
    “It definitely felt like we were getting the band back together,” says one participant.
    The band’s modest assignment was to produce a few briefing papers to hand off to the post-election transition team, which would presumably be too busy screening job candidates to do much policy analysis. “We figured we’d do some prep work, then once Obama picked his people, they wouldn’t care what we had to say,” another team member recalls. But once the economy imploded, that prep work took on outsized importance. The next president would have to act with superhero speed to deal with multiple nightmares unfolding in real time. Briefing papers from Washington veterans who were already immersed in those nightmares would be extremely useful.
    Lew ran the stimulus prep. Obama would inherit crises in the banking,housing, and auto sectors, but a jobs bill looked like Job One, an “early test of leadership,” as Lew noted in one memo. “In addition to direct policy impact, it will be symbolic of competence to execute effectively.” So Greenstein and Lew—a taller, clean-shaven version of the green-eyeshade type—tried to get a handle on the economic outlook. It felt like trying to