Investors worldwide have prepared for a new chief executive of the most important country on Earth for months by shedding assets and shivering with dread -- and on Tuesday they got their man.
The new boss of the U.S. Treasury, Federal Reserve, armed forces and dollar, the new director of global trade flows, the new captain of the capitalist system, will be a 47-year-old attorney who grew up about as far from the dark center of power as can be imagined -- in sun-baked Honolulu.
Already Markham plays loose with the facts since the new boss of the Federal Reserve will not be Obama. It will remain Ben Bernanke whose term of office lasts until 2010.
Barack Obama now stands in broad daylight, where skeptical investors in Tokyo, Singapore, Beijing and London can assess the real man instead of the political animal running for election.
I think they will find his intelligence, his oratory, his dedication to public service, his ease at gathering smart advisers, his ability to inspire confidence and his tight management of a brilliant political campaign are all the real deal. As a result, despite his incredibly thin résumé, investors will come to believe he is ready to take on this august job.
Perhaps Markham should wait until Obama actually takes office before making these assessments. He had a chance at his press conference on Friday, for example, to address the issue of whether or not he would increase the capital gains tax but we got nothing from him in the wayof substance on this or any other major issue. Markham then entertains us with a bit of economic psychobabble:
It's almost impossible to say with certainty how Obama will govern as these difficulties arise, for there is nothing in his background that will help us judge. We can only pray that he approaches issues in a holistic way -- not reactively but with a grand plan into which each fresh nuance is thoughtfully fit -- much as he conquered the intricacies of the long presidential race.
Now comes the absurd comparison with Ronald Reagan. Of course, while making the comparison, Markham just can't refrain from taking a shot at The Gipper:
I'm hopeful Obama will turn out to be as successful as Ronald Reagan in this regard. Reagan was no genius in the classic sense, but he had a thoughtful, humanistic vision that guided his path. And for the most part he had a good economic team that cleaned up the titanic mess of the 1980-81 recession and, after an initial 20% decline in the stock market in his first 20 months, delivered us into a bull market that generally prevailed for 25 years.
But what was the economic philosophy of that "good economic team?" Markham just can't bring himself to say anything about cutting taxes which was derided back then by much of the media as "Reaganomics." Of course, when the economy did take off, the media quickly dropped that term since they didn't want Reagan's name to be associated with that success. Whatever economic policy Obama chooses to follow, according to Markham, the key ingredient will be his ability to use "smart words," that have "incredible power."
Obama was sometimes criticized during the campaign for being more of a speechmaker than a lawmaker, but that is not such a bad thing. Smart words, delivered well in public, have incredible power. The ability to inspire confidence in a well-articulated vision can help drive men and women to achieve things that may be well beyond their own imagined abilities. This is something that we have seen repeatedly through history, and it should not be minimized.
Reagan also used "smart words" but they were delivered in support of a "smart policy." Smart words used to sell a socialist program still isn't going to make that program work. However, Markham has bought into the notion that "smart words" are the key ingredient into making an economic policy (whatever that policy is) work and just won't let go of this notion:
In these circumstances, the world will need a leader in Washington who can meld his people by sheer force of personality and oratory to confront these dragons as a common task and sacrifice, much like Churchill and Reagan did, and give hope that better days will lie ahead. Fortunately, it seems like we have that guy, and now it's up to him to execute. He'll have a short window in which to gain the markets' confidence, so let's hope he can lead a nation to defeat a culture of debt as well as he led his campaign to defeat the old political establishment.
We still await from Jon Markham some sort of commentary as to what the actual Obama economic policies will be. Does it matter if those policies are free enterprise with low taxes or socialistic with confiscatory taxes? Markham does not give us the answer since he is so enamored with the supposed power of words no matter what the policy. And please, Jon, stop with the artificial comparison of The Hipper to The Gipper.
