US Politics: Sitting/Standing at Obama's State of the Union

On Sunday afternoon, I will be at The Emirates Stadium in London, watching Arsenal v Manchester United in football ("soccer"). Since I am a Tottenham Hotspur fan, so why would I do this?Well, I could watch the game from the comfort of my armchair, rooting against both teams, but nothing beats watching an event live and in person.

I feel the same about Wednesday night’s State of the Union address by President Obama. The BBC television coverage's was fine, but most of the time, there was no way of knowing who was up and who was down. If only I had been in the Capitol chamber, I could have gotten a better reading of the politics, just by watching the ritual of members of Congress demonstrating their feelings by either standing or remaining firmly seated during the address.

I don‘t know when the tradition of standing and repetitive applauding for the President during the State of the Union started. On this occasion, Congress’s version of aerobics began after Obama’s long, uninterrupted opening. Once members started applauding, they were up and down with considerable frequency as the President took them through his plans for jobs, financial reform, civil rights, nuclear weapons, Iraq and Afghanistan, education, reduction of the deficit, health care, and gays in the military.

A Gut Reaction to Obama’s “State of The Union” & Foreign Policy: Ignoring the Kids in the Backseat
Video & Transcript: President Obama’s State of the Union Address (27 January)

Measured through the BBC's restricted perspective, how did he do? Well, this was a tour de force. Obama is a brilliant speaker but, let's be blunt, he also compares incredibly well with his predecessor. On this night, Obama was Presidential.

Still, there were quirks in the presentation. By tradition, one Cabinet member is left behind in the White House, a precaution in case all the others are wiped out by some disaster or nefarious activity during the speech. I did not see the Secretary of State, Hillary Clinton, in the audience. Surely Obama did not choose her to hold the fort! [Editor: Fret not. Clinton was in London for talks on Afghanistan, Yemen, and Iran.] Then there were the military brass hats who were present. Perhaps it doesn’t matter if they are all wiped out, especially if they keep giving Obama stony-faced looks, as they did when he brought up the issues of gays serving in the armed forces.

And there was a bit of controversy. Obama, a constitutional law expert, took on the judiciary. “With due deference to separation of powers,” he said, “last week the Supreme Court reversed a century of law that…will open the floodgates for special interests…to spend without limit in our elections…I urge [Congress] to pass a bill to correct the problem.” For 30 seconds, the cameras fixed on the Supremes, so I do not know which legislators stood or sat, as the judges remained immobile. That would have been useful information.

And there were the signs of the White House's building battle with Congress. Earlier in his speech, Obama spoke of sending a bill to Congress on job creation. Within minutes, Republicans peremptorily dismissed the proposal, expressing no interest in using $30 billion in bank bailout money for business tax credits.

I wonder whether Obama looks enviously at Gordon Brown. The British set piece equivalent of State of the Union is the Opening of Parliament, when Elizabeth II reads the Queen’s Speech, detailing the government’s legislation package for the following parliamentary session, in the chamber of the House of Lords. The speech is effectively written by the Prime Minister and his inner cabinet. Her Majesty just reads it. All members of the House of Commons gather, standing, at the back of the chamber while the Lords are seated. There is rarely any question as to whether the bills will pass. Government majorities and whips will see to that. So no stand/sit dilemma here.

So two cheers for Obama and three cheers for the British in the stand/sit debate. The American practice wastes time. It is irritating and childish. Standing ovations should be reserved are for glorious feats in a Test Cricket Match (especially versus Australia), scoring a winning goal in football ("soccer"), and the awarding of an Oscar. Ovations during a speech reduce and devalue it. And for members to divide politically when their President calls upon them to show leadership, not partisanship, is downright offensive, not just to the President but to the electorate.

Still, next time BBC, give me a wide-angle view.

The Latest from Iran (29 January): Sideshows and Main Events

2320 GMT: The Committee of Human Rights Reporters has issued a statement on recent allegations against its members, many of whom are detained:

The civil society’s endurance depends on acceptance and realization of modern norms and principles. When a ruling establishment with an outdated legal system tries to impose itself politically and ideologically on a modern society, the result will be widespread protests.

2315 GMT: Correction of the Day. Although it was not widely noted, there were 40th Day memorial ceremonies for Grand Ayatollah Montazeri in Qom.

2310 GMT: Diversion of the Day. From Press TV:

President Mahmoud Ahmadinejad's top aide said Friday Tehran is concerned about the direction of the US administration after President Barack Obama delivered his first State of the Union address.

"We have concerns Obama will not be successful in bring change to US policies," Esfandiar Rahim-Mashai, the senior aide to President Ahmadinejad and his chief of staff, said.

With respect, Esfandiar, I don't think President Obama is your biggest concern right now.

NEW Iran Patriotism Special: Wiping the Green From The Flag
Iran Document: Karroubi Maintains the Pressure (28 January)
Iran Document: Resignation Letter of Diplomat in Japan “Join the People”
Iran Document/Analysis: Karroubi’s Statement on the Political Situation (27 January)
Iran Analysis: Leadership in the Green Movement
The Latest from Iran (28 January): Trouble Brewing

2300 GMT: Yawn. Well, we started the day with a sanctions sideshow (see 0650 GMT), so I guess it is fitting to close with one. US Secretary of State Hillary Clinton, speaking in Paris:

China will be under a lot of pressure to recognize the destabilizing impact that a nuclear-armed Iran would have in the [Persian] Gulf, from which they receive a significant percentage of their own supplies....We understand that right now it seems counterproductive to [China] to sanction a country from which you get so much of the natural resources your growing economy needs....[But China] needs to think about the longer-term implications.

1. The White House is not even at the point of agreeing a sanctions package with the US Congress, let alone countries with far different agendas.
2. China is not going to agree tough sanctions in the UN Security Council. Really. Clinton is blowing smoke.
3. About the only outcome of this will be Press TV running a story on bad America threatening good Iran Government.


2250 GMT: Back after a break (Up In The Air is fantastic --- there, I've said it) to find that the reformist Islamic Iran Participation Front has written an open letter to Iran's head of judiciary, Sadegh Larijani, putting a series of questions over the executions of Mohammad Reza Ali Zamani and Arash Ramanipour.

1820 GMT: We've moved our item on the regime's apparent removal of Green from Iran's flag to a separate entry.

1755 GMT: Today's Pot-Kettle-Black Moment. Just came across a discussion on Press TV of a bill, passed in the US House of Representatives, threatening to block "anti-US" television channels.

Don't get me wrong: this is an incredibly stupid measure, although as Professor William Beeman, the most reflective of the three guests notes, it is a symbolic declaration unlikely to become law. However, I have to note that at no point do the words "Internet filtering", "expulsion/imprisonment of journalists", "jamming of satellite signals" (say, of Voice of America Persian or BBC Persian) come up in the conversation, which also includes a Dr Franklin Lamb and a Dr Seyed Mohammad Marandi.

1750 GMT: The Judiciary v. Ahmadinejad. At insideIRAN, Arash Aramesh has a useful summary of the suspension of the publication Hemmat by Iran's judiciary. The twist is that Hemmat, which ran into trouble for running an attack piece against Hashemi Rafsanjani, is a supporter of the Ahmadinejad Government. No surprise then that the President reportedly declared:

I am not very happy with some of the Judiciary’s actions. Someone published a paper and you shut it down. It is the job of a jury to order the closure of publications. We do not agree with such actions and believe that these actions show a spirit of dictatorship.

However, Aramesh does not connect the Hemmat story to the imprisonment of Mohammad Jafar Behdad (see 1230 GMT), an official in the Ministry of Culture and Islamic Guidance, for four months.

1725 GMT: The Latest from Gohardasht Prison. Peyke Iran reports that 300 Ashura detainees are under severe pressure by Ministry of Intelligence agents, demanding confessions of "mohareb" (war against God), in sections controlled by the Revolutionary Guard.

1700 GMT: The International Committee for Human Rights in Iran has started a new blog. Current posts consider the Zamani/Rahmanipour executions and "Members of Committee of Human Rights Reporters Under Pressure to Make Forced Confessions".

1600 GMT: The Strategy of Deaths. Tehran Prosecutor General Abbas Jafari Doulatabadi has offered details on the regime's handling of executions: having put to death two pre-election detainees to death yesterday, the Government has handed down five more sentences on five people arrested on Ashura (27 December). The sentences are currently being appealed.

Doulatabadi's declaration complements a recent announcement that by Iran Prosecutor General Gholamhosein Mohseni Ejei that at least three Ashura Day detainees will be executed. Ejei also said four more pre-election prisoners had been sentenced to death. (Added to Thursday's executions, Doulatabadi and Ejei's numbers match up to the "eleven" death sentences announced by Iranian state media yesterday.)

1410 GMT: Man, 1) Ayatollah Jannati is in a really bad mood after being verbally slapped by Mehdi Karroubi; 2) the Government is scared of the forthcoming demonstrations on 22 Bahman (11 February); 3) both. The Los Angeles Times offers translated extracts from Jannati's Friday Prayers address (see 1155 GMT) in Tehran:

The prophet Muhammad signed non-aggression pacts with three Jewish tribes. The Jews failed to meet their commitments, and God ordered their massacre (by Imam Ali, the 3rd Imam Shia, despite his reputation for compassion)....When it comes to suppressing the enemy, divine compassion and leniency have no meaning.

The judiciary is tasked with dealing with the detained rioters. I know you well, judiciary officials! You came forward sincerely and accepted this responsibility. You are revolutionary and committed to the Supreme Leader. For God's sake, stand firm as you already did with your quick execution of these two convicts....

God ordered the prophet Muhammad to brutally slay hypocrites and ill-intentioned people who stuck to their convictions. Koran insistently orders such deaths. May God not forgive anyone showing leniency toward the corrupt on earth.

1230 GMT: An Ahmadinejad Official in Jail. Mohammad Jafar Behdad, head of internal media at the Ministry of Culture and Islamic Guidance, has been sentenced to 4 months in prison. Behdad, a former head of the Islamic Republic News Agency, was convicted of disregarding judiciary warnings against provocative publications. His newspaper Hemmat had been suspended for a feature on "Hashemi [Rafsanjani] and his band of brothers".

1220 GMT: Verbal Skirmishes. Retired Revolutionary Guard General Ali Asgari, a former minister in the Khatami Government, has declared that Hashemi Rafsanjani must remain by the side of the Supreme Leader and denounced Rafsanjani's verbal attacker, Ayatollah Mohammad Yazdi, as a radical who defends a backward Islam.

On the regime side, Iran's police chief Esmail Ahmadi-Moghaddam has announced that "some of the elite are against the regime and with the enemy". At the same time, he appears to have held out a hand to Mir Hossein Mousavi, saying he "was deceived" by these wrong-doers.

1210 GMT: The "Real" Karroubi Interview. Fars News, whose distorted report on Mehdi Karroubi's views inadvertently moved Karroubi's challenge to the Ahmadinejad Government centre-stage, makes another clumsy intervention today.

Selecting extracts from Karroubi's interview with Britain's Financial Times and quoting them out of context, Fars declares that Karroubi has "100%" backed the Supreme Leader and denounced protesters.

Yeah, right.

1155 GMT: Your Tehran Friday Prayer Summary. Ayatollah Ahmad Jannati, the head of the Guardian Council, had the podium today. Given that Mehdi Karroubi knocked him about a bit yesterday, Jannati was probably not in the most conciliatory of moods as he said:

Weakness in the face of events such as the "irreverence" of demonstrations on Ashura will undermine the regime. Ayatollah [Sadegh] Larijani, be a man, get tough, bring in some protesters. (Hey, but it was pretty cool that you executed those two guys yesterday to please God.)

1140 GMT: A very slow day, both for sideshows and main events. During the lull, this comment from a reader to Andrew Sullivan's Daily Dish, reacting to the Zamani/Rahmanipour executions, is striking:

You see the strategy is an obvious one: start with the people who are the weakest links, some obscure monarchist group and not directly related to the reformist/Mousavi's camp or the greens, that way it would make it harder politically for [Mir Hossein] Mousavi or [Mehdi] Karoubi to defend them. Then they will advance. This is, in their mind, also the best way to send a message about Feb 11th that if you are arrested on that day, you could be executed. The combination of desperation and cruelty.

0750 GMT: Remembering Montazeri. Video of the bazaar at Najafabad, the birthplace of Grand Ayatollah Montazeri, was empty on Thursday to mark the passing of the cleric in late December. Memorials for the "40th Day" of Montazeri's death were planned for both yesterday and today.)

0650 GMT: There are a number of obstacles to clear this morning before getting to the important developments. Foremost amongst these is last night's news that the US Senate, the upper house of the Congress, has approved tougher sanctions against Iran. The focus is on petroleum, denying loans and other assistance from American financial institutions to companies that export gasoline to Iran or help expand its oil-refining capacity. The penalties would extend to companies that build oil and gas pipelines in Iran and provide tankers to move Iran’s petroleum. The measure also prohibits the United States Government from buying goods from foreign companies that do business in Iran’s energy sector.

Even if sanctions are central to a resolution of Iran's political crisis, as opposed to their place in the manoeuvres over Iran's nuclear programme --- personally, I don't think they are --- there is a lot of bureaucratic road to cover before they are in place. The Senate has to agree its version of the bill with the House of Representatives. More importantly (and The New York Times story ignores this point), the Obama Administration so far has opposed the petroleum measures because they are unlikely to be effective. The White House and State Department prefer "targeted" sanctions, aimed especially at economic interests of bodies like the Islamic Revolution Guards Corps.

Then there is the Washington sideshow of Very Important People battering each other in the guise of offering the Very Best US Policy on Iran. The Washington Post announces the boxing match between Richard Haass, formerly of the State Department and now head of the Council for Foreign Relations, and the Flynt/Hillary Leverett duo, formerly of State and the National Security Council. The punches are entirely predictable --- Haass, while proclaiming himself a "realist", has joined the chorus of US experts singing of "regime change", while the Leveretts are staunchly defending the legitimacy of the Iran Government --- and pretty much swatting air when it comes to the complexities of the Iranian situation. (But Haass was best man at the Leveretts' wedding, which turns a marginal story into a "quirky" one.)

So where are the significant stories? Well, there is yesterday's execution of two detainees, Mohammad Reza Ali Zamani and Arash Rahmanipour, who were jailed in April 2009 for endangering Iran's national security. In one sense, this is another sideshow. Obviously, neither Zamani and Rahmanipour were involved in post-election protest and the "monarchist" group to which they allegedly belonged is not significant in the Green movement.

However, the regime was far from subtle in linking the hangings of the two men to the demonstrations of Ashura (27 December), and that linkage --- inadvertently --- displays its fear of the forthcoming marches on 22 Bahman/11 February, the anniversary of the 1979 Revolution. What's more, by promising the executions of nine more detainees if everyone didn't just shut up and go away, the Government made a risky commitment. Either it goes ahead with the executions, making more martyrs for the protests, or it backs down.

And then there is The Week of Mehdi Karroubi, with the cleric launching another broadside against President Ahmadinejad and his allies yesterday. Some media continue to be led astray by confusion over Karroubi's loud and emerging strategy --- The New York Times, for example, mis-reads Karroubi's latest statement as "conciliatory remarks...shifting the blame for the violent postelection crackdown away from Ayatollah Khamenei".

They are not. Karroubi is both giving the Supreme Leader (or "Mr Khamenei", as he was labelled on Monday) a chance and setting him a test: do what you are supposed to do under our Constitution and Islamic Republic, Supreme Leader, and make your President accountable for injustices and abuses.

Enjoy all the sideshows, folks, but in this political circus, that's your centre-ring main event.

Getting Tough with Israel: US Congress to Put Pressure on Obama?

Fifty-four members of the US Congress have signed a letter, initiated by Jim McDermott from Washington and Keith Ellison from Minnesota, asking President Barack Obama to put pressure on Israel to ease the siege of the Gaza Strip. The authors have pointed to the necessity for ease of movement of people into and out of Gaza, especially students, the sick, aid workers, journalists, and those with family concerns. They have also asked for the import of building materials to rebuild houses. The letter summarises:

This concern [regarding ongoing Hamas missiles] must be addressed without resulting in the de facto collective punishment of the Palestinian residents of the Gaza Strip.

We ask you to press for immediate relief for the citizens of Gaza as an urgent component of your broader Middle East peace efforts.

The Israeli Embassy in Washington has responded:

The Israeli position is that the Hamas government in Gaza does not meet the conditions set forth by the international community and the Quartet. And as long as Hamas continues to attack Israel with missiles and other means, Israel will not open the border crossings. With this, Israel is doing everything possible to ensure that humanitarian aid enters Gaza in a controlled manner so that it is ensured that the population receives what it needs, including medical care in Israel. But Israel will not allow a neighbor that calls for its destruction to enjoy the benefits of an open border.

Meanwhile, Ellison criticized the US House of Representatives' rejection of the Goldstone Report on the Gaza War, arguing that the report "only presents facts and raises recommendations for the future". He said that the rejection hurt the Obama government's role as an honest broker in the Middle East conflict.

US Politics: Explaining Congress and "Obama's Downfall" to a Martian

Let us imagine that a Martian, “Marty”, dressing like a stand-up American and with the ability to read and speak English, has landed in Washington, D.C. He reads the politics pages in The Washington Post and scratches his head in wonderment. So he accosts a passer-by, “Kane”, who happens to be astute and neutral on choice of political party.

Marty: Excuse me, sir, but would you mind explaining some things in the newspaper?

Kane: I’ll do my best.

Marty: It says that the President has lost his healthcare legislation because the Democrats have lost a Senate seat. Is the President the loser?

Kane: I think the losers are the more than 30 million Americans who will be denied access to medical insurance if the Bill fails. That said, the legislation is not lost yet. Democrats still hold 59 of 100 seats in the Senate.

There is much they can do to save the bill but special interests have made it a mockery. The state of Nebraska got itself all sorts of exemptions for its senate vote. However, I think there is still all to play for.


Marty: Surely, the legislators shouldn’t play politics with people’s health.

Kane: You would think so. But this is D.C. where politics trumps all.

Marty: The newspaper also says that the President is out to get the banks and the bankers. Why?

Kane: In reality he isn’t. What he is seeking to do is to restore the position that lasted for 50 years until the Reagan Administration, separating high risk investment banks from low risk retail banks. He doesn’t want to penalise sensible lending.

Marty: What has happened?

Kane: Bankers are directly responsible for the crash of 2008 and its aftermath. They took huge lending risks not just on “sub-prime” mortgages where banks lent money on poor but over-valued property to borrowers who could not possibly afford to repay loans. They also lost hundreds of millions of shareholders' dollars in bad lending on commercial property, leisure developments, and other projects. And not one banker has yet been brought to book. Governments all over the world bailed out their banks who, instead of repaying debt when they made profits, have given huge bonuses to the people who got us into the mess in the first place.

Marty: So will the President legislate against the banks?

Kane: He doesn’t have to. He could sign an Executive Order to curtail bonuses and separate banks but Congress would probably overrule it.

Marty: So he’ll have to go to Congress?

Kane: Yes, and he has a majority in both houses. However, there is a problem. Banks support senators and Congressmen financially so legislators would bite the hand that feeds them by voting for the legislation.

What’s even worse is the Supreme Court decision, handed down last week, on campaign finance. Corporations are no longer constrained by the amounts they may give to politicians. So banks will support legislators who vote "favourably" and will threaten to withdraw support and give it elsewhere if they are challenged. As the banks are stuffed with cash, they will be able to advertise their chosen candidates into office.

The Court decision was awful; it was political. This is often the way. Ten years ago, the Supreme Court handed a Presidential election to its favoured candidate. It doesn’t end there. For example oil interests could provide huge sums to candidates for Congress and if those candidates become legislators, the environment protection the world needs would be at serious risk.

Marty: So your system has an Executive Branch where the President is in day-to-day charge with huge powers. However, he can be easily stymied and frustrated by the legislators. And even if he is not, the judiciary can put a spoke in the wheels and on political not legal grounds. What bright sparks thought up this Constitution?

Kane: There are all sorts of safety nets. For example, the President could try to find Congressmen to put through a different campaign finance law and, if that law was popular, seek a Constitutional Amendment to block the Supreme Court.

Marty: We don’t have this system where I come from, thank heavens.

Kane: Well, Obama’s not done yet. And he’s no fool. Watch this space.

And the moral? Winston Churchill had a point when he said, “democracy is the worst form of government……except for all the rest.”

Obama Reflects: Domestic Problems, Wars Abroad, and the Difficult Middle East

In interview with Time Magazine this week , Barack Obama faced up to disappointments at home and abroad

After covering his health care proposals and underlining the importance of financial reform, Obama turned to foreign policy. He talked of the "Administration taking out more al-Qaeda high-level operatives". He admitted that the decision to increased the number of troops in Afghanistan was one of the toughest he had ever made, adding that his Administration is doing a good job in getting troops out of Iraq even though it is not an easy process. On Iran, Obama reiterated the dual-track approach of engagement and sanctions.

Perhaps the most striking Obama reflection, however, was on the Israeli-Palestinian peace process: "The Middle East peace process has not moved forward. And I think it's fair to say that for all our efforts at early engagement, it is not where I want it to be."

The interview in full:

Klein: I talked to a bunch a folks — friends, my kids — what should I ask the President? It was almost unanimous: the thing that people remarked on is just how crazy things are. How difficult it is. Focused on the health care process — what have you learned from that process, what's your takeaway? How is it going to influence the rest of your presidency?

Obama: Look, even if we hadn't tackled health care, this year was going to be a tough year. During the transition period last year, it became apparent very quickly that we were going to have to make some fast, tough and in some cases politically unpopular decisions to make sure the financial system didn't melt down and we did not spiral into a second Great Depression. We made those decisions and executed them, and I am absolutely convinced that had we not acted the way we did that the situation would've been far worse.

Having said that, we've still lost 7 million jobs over the last two years. People who are out of work or have seen their 401(k)s diminish or their hours reduced understandably are frustrated when they see big banks getting money for a problem that they helped cause. And when you see the unemployment rate spike to 10%, it was inevitable and justifiable that the political climate would become very difficult. So health care was done against the backdrop of what was already going to be a tough political climate.

Having said that, there is no doubt that the process for doing big, important things in this country has become far more difficult because of the way Congress is working right now. I came in expressing a strong spirit of bipartisanship, and what was clear was that even in the midst of crisis, there were those who made decisions based on a quick political calculus rather than on what the country needed. The classic example being me heading over to meet with the House Republican caucus to discuss the stimulus and finding out that [House minority leader John] Boehner had already released a statement saying, We're going to vote against the bill before we've even had a chance to exchange ideas.

So I understand the strategy that the Republicans decided to pursue. There is a good political argument for it. I don't think it has served the country well, and it hasn't served the process well. Health care then became caught up in that process. And I think that what's clear is that if you have an opposition party that is determined to say no [and] sees their political survival dependent on gridlock, things can get tied up in knots. So that's the second point.

And the final point is that health care was going to be hard in any environment with any Congress. There's a reason why seven Presidents and seven Congresses have failed to do it. It is a massive undertaking. It involves every special interest imaginable. The American people know that the status quo isn't working, and yet sometimes the devil you know is better than the devil you don't. So it is very easy to caricature any efforts at reform as negative.

Now, I've given you three big reasons why this was so tough. Having said all that, I think we're going to get it done. And I think this is going to be a framework that allows us to genuinely say that every American is going to have access to quality, affordable health care. And that people who have health care have security in the coverage that they've purchased. That is an enormous accomplishment, and the thing that I'm most proud of is that not only will we have dealt with access, not only will we have dealt with accountability when it comes to insurance companies, but when all is said and done, this offers our best chance at significant deficit reduction, of any of the other options that are out there.

Klein: But it comes with a high opportunity cost, given the political hot spot of the moment. Say you're sitting in Belmont, Mass., or Needham, and you're watching the unions get their deal and Nebraska get its deal and everybody else get their deals. What would you say to that person, who probably voted for you because you promised change and — I was just reading David Plouffe's book [The Audacity to Win] — the emphasis on going after the special interests? But you've made deals with all the special interests to get this done.

Obama: Well, I'll tell you what, Joe. What I would say is, If you look at this bill when it is said and done — not where it was coming out of one committee or where it was coming out of another committee, but the bill that I actually sign. I think what you're going to see is that there have been very few instances where something of this magnitude had relatively few provisions in there that weren't for the broad public. Getting something through 535 members of Congress involves some trade-offs.

When I promised change, I didn't promise that somehow members of Congress weren't going to be looking to try to get a project in their district or help a hospital in their neighborhood. What I promised was that this White House was going to constantly be pursuing the people's interests. And this bill will pass that bar by a mile.

One last thing I'll say about this: There is no doubt that politically speaking, having this intense a focus on the sausage-making process in Congress is never helpful.

Klein: But it's impossible to avoid.

Obama: It's impossible to avoid if you're trying to do big stuff. Now it is even more difficult in a 24-hour news cycle. I have no idea what Lyndon Johnson had to do to get the Civil Rights Act done. Or if I have an idea, it's because I read Robert Caro's biography 40 or 50 years later. So that process is one that people have legitimate concerns about. And one of the things that I think is very important for us to do moving forward on financial reform, on energy legislation, on the jobs package that we're going to put forward, is we've got to do a better job highlighting what's good in these measures.

But I also think that I have to make sure that our team doesn't lose sight of our broader message. Which is that the American people have a right to see what's going on, understand what's going on. That there are some things you can compromise, but there are some things you shouldn't compromise. If you're dealing with the interest groups here in Washington, don't get too comfortable. That's something you have to constantly reinforce and remind.

Klein: What do you mean, "Don't get too comfortable"?

Obama: Don't get too comfortable in the sense that there's a culture in this town, which is an insider culture. That's what I think people outside of Washington legitimately can't stand. A sense that they're not being heard. I think we've done actually a pretty good job of working in this town without being completely consumed by it. But from the outside, if you're just watching TV and all you're hearing about is the reports, people may get the false impression that somehow [the insiders] are the folks we're spending more time listening to.

In fact, I spend most of my time listening to the people who — through their letters or through town-hall meetings or in my travels throughout the country — are telling me the stories of hardship and heartache. Losing their house because they don't have health insurance. That's what moves us here, but that's not always what comes across in the day-to-day combat that we're going through.

Klein: Well, it seems obvious that when you get through with this bill, you're going to be turning to some of the things that upset people and the perception that you're at one with Wall Street, at one with Big Government. And obviously that means financial reform and also I think budget and infrastructure are going to be big things this year. But let me ask you first about the financial reform part of it. One of your advisers, Paul Volcker, has said that none of the financial instruments that have been developed over the past 20 years have added anything to our economy. And I remember you and I talking during the campaign about how the economy was going to have to change. Do you agree with Volcker?

Obama: Well, what I agree with Paul about, and I agree with him on a lot of things, is that sophisticated financial tricks and fancy hedge instruments, etc., aren't valuable just because they're making somebody $100 million worth of bonuses. And I think it is very important that we understand first principles when it comes to our financial sector. The role of the financial sector is to raise capital for businesses that actually make things and provide services to people. To help grow this economy. They should make a profit doing it.

I think the fact that we have a diverse and sophisticated and innovative financial marketplace is a positive. It gives more businesses more tools to raise capital for good ideas, entrepreneurs to start businesses. But when you see more and more of the financial sector basically churning transactions and engaging in reckless speculation and obscuring underlying risks in a way that makes a few people obscene amounts of money but doesn't add value to the economy — and in fact puts the entire economy at enormous risk — then something's got to change.

Now, I want to go back to your initial premise of us being close to Wall Street. We knew that this would be a consequence of us managing TARP. It was inevitable. One of the things that we have to do is just remind people that having inherited this financial disaster as well as the TARP structure, this thing was managed in as prudent a way as any financial-crisis management has ever been managed.

Klein: I think they'll give you that.

Obama: And what we're now doing, for example, on the fee on these big financial institutions is not designed to punish; it's just designed to meet what was in the legislation originally, which was: This was not going to cost taxpayers a dime's worth of money. Something, by the way, that nobody believed, but something that we may actually be able to deliver on.

With respect to financial reform: This was always one of our top agendas. I started talking about this during the campaign, and I made a major speech about how we're going to move forward [last] March. My hope had been that health care wouldn't take this long. And that we would've teed up both energy and financial reform before the end of the first year. If there's one thing I have learned — you asked earlier about something I've learned about this process — it always takes longer than you think.

Let me just close on financial regulatory reform. This is going to be a top priority. You are already seeing the big banks and some of these other interests lining up in opposition to basic core reforms, like making sure that consumers know what the fine print is when it comes to their credit cards or their debit cards or their mortgages. You're already seeing them resisting the idea that they should have a regulatory regime that isn't full of loopholes.

And my attitude is that this is a fight that is entirely consistent with what we've done last year, it's entirely consistent with who I am and how I campaigned, and it's a fight that I welcome. And it'll be interesting to see how some who have tried to exploit legitimate anger at the big banks this year by trying to put it on us are going to position themselves when in fact they're going to want to protect all these financial institutions from the regulations that will prevent the kind of disaster that we've seen over the past couple of years.

Klein: They're going to have to vote yea or nay, aren't they?

Obama: Right.

Klein: During the campaign, the one program that you proposed that everybody from the left to the right loved was the infrastructure bank. And it seems to me that was another thing that kind of fell by the wayside this year.

Obama: You're wrong about that. Well, you're right that people liked it.

Klein: But that's the good government fight. That's the fight against the appropriators in Congress.

Obama: You're absolutely right, and look, one of the things we've got to do better is to tell the story of what was in the [American Recovery and Reinvestment Act]. That was the largest investment in research and development in our history.

Klein: And it's coming online this year?

Obama: And it's moving. One constituency that I know is happy with me are scientists, inventors, entrepreneurs who are in the high-tech sectors, because they are seeing already the incredible investments that are happening that are going to have 20-, 30-year payoffs. It was the biggest investment in education. And it wasn't just the usual formulas. Some of it was helping to make sure teachers didn't get laid off, but what [Secretary of Education] Arne Duncan is doing with our Race to the Top Fund — we've already had 48 states react by implementing reforms that had been resisted for years. And you're starting to see the teachers' unions really think through how can they be a partner in the process of reform. And when it comes to infrastructure, not only was it the biggest investment in infrastructure since the Eisenhower Interstate Highway System, but we actually introduced the infrastructure-bank concept in the Recovery Act.

Now, you are absolutely right that this seed that we've planted is going to have to be carefully nurtured. And for readers who aren't familiar, the basic idea is that we should not only fund the usual repaving of highways — although that's important — but we should also think, What's the 21st century infrastructure that's out there? And those decisions should be made by people who really have clear ideas about the kind of infrastructure we're going to need. As opposed to it being determined solely by, you know, "Who's the chairman of the transportation committee from what state?"

But I am sensitive to the fact that Congress has its prerogatives. We're trying to nudge them in the direction of rationalizing our transportation knowledge — particularly in a time of fiscal constraint. And by the way, that's a principle that's going to apply, Joe, to all of government. You mentioned earlier the pivot that we have to make. It's not driven by politics. We had to do what we had to do last year, whether it was politically popular or not. Now that we have begun the recovery process and the economy has stabilized, we have to deal with our long-term fiscal problems, whether it's politically popular or not. And some of those decisions are going to be just as unpopular.

But part of that pivot, then, is to say, "How are we going to make sure that we squeeze every ounce of value out of every dollar that we spend?" We began that process with Pentagon reform. And the victories that [Secretary of Defense Robert] Gates helped win are ones that this town completely discounted when we started. We are scrubbing the budget once again to make sure that every program that we're funding actually has some justification — it actually works. Yesterday we had a whole bunch of CEOs and innovators here to talk about modernization of government. The infrastructure bank falls in that broader category of, How do we make these dollars work better? Because we're going to have to make some very difficult spending decisions moving forward.

Klein: It seems to me that these are ways — the Wall Street battle — to start building trust in a small way. People have had 30 years of propaganda telling them that government doesn't work.

Obama: And my theory, Joe, has always been, A) A lot of people's skepticism is entirely justified. B) There's no reason that government should inherently be inefficient. C) At a time when we've got such enormous problems and such limited resources, people are going to be looking to government for help. But they want to make sure that their dollars are well spent, because those are the same decisions that they're having to make in their own lives. They're looking for value. Whether they're shopping for a pair of jeans or they're going to a restaurant or they're buying a new car. And right now, they don't feel like they're getting good value out of their government.

Klein: Let me ask you one foreign policy question. My sense is that — just my own personal sense, but also from people I talk to — the overall conception of your foreign policy has been absolutely right. Necessary, corrective. Subtle, comprehensive.

Obama: We have a good team.

Klein: But there have been some problems in execution.

Obama: Well, I would not deny that, but let me say that given what's on our plate — and you know the list. I don't need to tick them off.

Klein: I've been to most of them in the past year.

Obama: I actually think that our execution has been sound as well. I'll give you the examples of where I think our foreign policy team has gotten the right strategy and has executed well even though the outcomes are still uncertain — because these are tough problems that aren't subject to easy solutions. I think that in Iraq, we are moving forward and on pace to get our troops out. It's messy, it's imperfect, but I think that our team has done a very good job managing that process.

I think in Afghanistan, as difficult as those choices were — and me sending in additional troops over the next two years was probably the toughest decision that I've made this year among a lot of very tough decisions, because it involved the lives of young men and women in uniform. We are monitoring very carefully how it's being executed. And I think that General [Stanley] McChrystal, General [David] Petraeus, [U.S. ambassador to Afghanistan] Karl Eikenberry and others are working double time to successfully implement this. I know that you've written, Joe, that there may be some questions in terms of pace of getting troops in. I can assure you that a fire is lit under them about making that happen.

Klein: That's one of the reasons I wrote that.

Obama: They want it to happen. And we are more or less going to be on schedule. We are probably ahead of schedule so far in terms of recruiting and training Afghans. Although I've said that we should set very modest expectations of what's sustainable to transfer to an Afghan government.

On Iran, one of our trickiest foreign policy challenges, we have held the international community together, both in our engagement strategy, but also now as we move into a dual-track approach. Which is, If they don't accept the open hand, we've got to make sure they understand there are consequences for breaking international rules. It's going to be tough, but I think the relationship we've developed with Russia will be very helpful. The outreach we've done to our traditional NATO allies will be very helpful. The work that we've done with China — including the work we've done with China to enforce sanctions against North Korea — will help us in dealing more effectively with Iran.

I mentioned North Korea — everybody was skeptical at the beginning of this year that we could get serious sanctions. Not only have we gotten serious sanctions, but they've actually been implemented. And finally — because this has been the area of most immediate concern — when it comes to counterterrorism, this Administration has taken out more al-Qaeda high-level operatives, has been more aggressive in pinning them down, not just in the border regions of Afghanistan and Pakistan, but also working with our international partners in places like Yemen and Somalia, than a lot of what's taken place previously.

Having said that, there's no doubt, as I said, that I think our intelligence failures in picking up [Nigerian terrorism suspect Umar Farouk] Abdulmutallab shows how much more has to be done. I think everybody understands that this is an area where we have to be relentless regardless of what else is on our plate. The other area which I think is worth noting is that the Middle East peace process has not moved forward. And I think it's fair to say that for all our efforts at early engagement, it is not where I want it to be.

Klein: Why is that? My sense of it is that [U.S. special envoy to the Middle East George] Mitchell spent a number of months negotiating a settlement deal and saw some progress from the Israelis and kind of got blinded by that, because he didn't see that it wasn't sufficient progress for the Palestinians.

Obama: I'll be honest with you. A) This is just really hard. Even for a guy like George Mitchell, who helped bring about the peace in Northern Ireland. This is as intractable a problem as you get. B) Both sides — the Israelis and the Palestinians — have found that the political environment, the nature of their coalitions or the divisions within their societies, were such that it was very hard for them to start engaging in a meaningful conversation. And I think that we overestimated our ability to persuade them to do so when their politics ran contrary to that. From [Palestinian Authority President Mahmoud] Abbas' perspective, he's got Hamas looking over his shoulder and, I think, an environment generally within the Arab world that feels impatient with any process.

And on the Israeli front — although the Israelis, I think, after a lot of time showed a willingness to make some modifications in their policies, they still found it very hard to move with any bold gestures. And so what we're going to have to do — I think it is absolutely true that what we did this year didn't produce the kind of breakthrough that we wanted, and if we had anticipated some of these political problems on both sides earlier, we might not have raised expectations as high. Moving forward, though, we are going to continue to work with both parties to recognize what I think is ultimately their deep-seated interest in a two-state solution in which Israel is secure and the Palestinians have sovereignty and can start focusing on developing their economy and improving the lives of their children and grandchildren.