The 2009 State of the Union: Change and Continuity
Tuesday, January 13, 2009 | 2:00 p.m. – 4:30 p.m.
Wohlstetter Conference Center, Twelfth Floor, AEI 1150 Seventeenth Street, N.W., Washington, D.C. 20036
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About This Event

Against the backdrop of a stalling economy and worldwide security challenges, President-elect Barack Obama will soon deliver his first State of the Union or budget message to Congress. The annual address represents an early opportunity for the new administration to chart its course in the face of numerous challenges. At Listen to Audio


Download Audio as MP3 an AEI event, the Institute’s scholars will preview foreign and fiscal policy issues that are sure to be central to the president’s address.

Obama seems poised to reformulate the United States’ foreign policy, particularly in the Middle East and Afghanistan. The administration will likely seek to cajole Iran into abandoning its nuclear ambitions, coax Syria into abandoning its revisionist history, and repair America’s image in the Arab world by pushing for a settlement to the Israeli-Palestinian conflict. But how realistic are these endeavors, given recent events in Gaza and estimates that Iran is less than a year away from a nuclear weapon? In addition, old challenges persist as Russia attempts to pull its former satellites back into its sphere of influence and as China’s intentions darken the horizon.

It is expected that the economy’s slide into a deep recession will make economic policy the centerpiece of the Obama administration. How will the new administration’s approach to the financial crisis differ from the Bush administration’s policies? What will the stimulus package entail? Will it include nontraditional provisions like mortgage-refinancing measures? And how will the deepening recession affect Obama’s ambitious promises for health care reform?

These and other questions will be the subject of two panel discussions.

Agenda
12:45 p.m.
Registration
1:00
Panel I: Foreign and Defense Policy
Panelists:
Leon Aron, AEI
Dan Blumenthal, AEI
Thomas Donnelly, AEI
Danielle Pletka, AEI
Moderator:
Gary J. Schmitt, AEI
2:15
Panel II: Economic Policy
Panelists:
Alex Brill, AEI
Lawrence B. Lindsey, AEI
Thomas P. Miller, AEI
Vincent R. Reinhart, AEI
Moderator:
 Kevin A. Hassett, AEI
3:30
Adjournment


Event Summary

 

AEI Scholars Preview Obama's Early Agenda

 

WASHINGTON, JANUARY 15, 2009--President-elect Barack Obama campaigned on change, but his administration may find its foreign policy options limited by obdurate adversaries abroad, even as the recession gives it a free hand to implement drastic economic changes. On January 13, AEI scholars assessed the prospects for Obama's foreign and domestic policy initiatives in a preview of his anticipated message to Congress.

The foreign policy panelists, led by Danielle Pletka, discussed areas in which the Obama administration will be tested. Russia and China, for example, draw their legitimacy at home from their ability to deliver economic growth. But as the worldwide economic crisis deepens, these governments may find their popularity waning. Leon Aron and Dan Blumenthal predicted Moscow and Beijing will clamp down further on political opposition in response. Whereas the Bush administration abandoned early efforts to hedge against murky intentions in Moscow and Beijing, preferring engagement, Obama will have the opportunity to promote democratic reform to help fully integrate these nations.

But change will not come easily. The Obama administration's grand strategy in the Middle East revolves around the ideas of direct negotiation with Iran over its nuclear program and attempts to tear Syria away from the Iranian camp, according to Pletka. Thus far, however, Iran has shown little interest in abandoning its nuclear ambitions. Although Syria has conducted secret talks with Israel, abandoning its recidivist behavior could threaten the Damascus regime's survival.

But even if an overarching redirection in foreign policy is unlikely, the deepening economic crisis will offer political cover for Obama to increase government spending massively and expand the federal government's role in the economy.

AEI's economists enumerated a number of areas in which the Obama administration might seek to expand the government's role. Kevin A. Hassett expressed concern that Democrats would use the proposed stimulus as political cover for future spending increases, such as funding universal health care. Alex Brill predicted that the economic downturn will offer the political space to implement many of the questionable tax provisions proposed during the campaign. Lawrence B. Lindsey repeatedly warned during his presentation, "We're about to frivol away $800 billion on a stimulus package that isn't really stimulus."

All agreed that the spending increases associated with the stimulus will be anything but temporary. "This increased spending is going to be $400 billion a year, not for two years, but forever," Lindsey concluded. "They are not going to be cutting back aid to states; they are not going to be cutting back medical programs in 2011. This is a permanent $400 billion increase in spending."

--PHIL ALITO and SCOTT GANZ

For video, audio, and event information, visit www.aei.org/event1864/.

For media inquiries, contact Veronique Rodman at 202.862.4870 or vrodman@aei.org.

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Event Materials
The 2009 State of the Union: Change and Continuity
AEI Participants

 

Leon
Aron

  • Leon Aron is Resident Scholar and Director of Russian Studies at the American Enterprise Institute. He is the author of three books and over 300 articles and essays. Since 1999, he has written Russian Outlook, a quarterly essay on economic, political, social and cultural aspects of Russia’s post-Soviet transition, published by the Institute. He is the author of the first full-scale scholarly biography of Boris Yeltsin, Yeltsin: A Revolutionary Life (St. Martin’s Press, 2000); and Russia’s Revolution: Essays 1989-2006 (AEI Press,2007); Roads to the Temple: Memory, Truth, Ideals and Ideas in the Making ofthe Russian Revolution, 1987-1991 (Yale University Press, Spring 2012).


    Dr. Aron earned his Ph.D. from Columbia University, has taught a graduate seminar at Georgetown University, and was awarded the Peace Fellowship at the U.S. Institute of Peace. He has co-edited and contributed the opening chapter to The Emergence of Russian Foreign Policy, published by the U.S. Institute of Peace in 1994 and contributed an opening chapter to The New Russian Foreign Policy (Council on Foreign Relations, 1998).


    Dr. Aron has contributed numerous essays and articles to newspapers andmagazines, including the Washington Post, the New York Times, theWall Street Journal,   Foreign Policy, The NewRepublic, Weekly Standard, Commentary, New York Times Book Review, the TimesLiterary Supplement. A frequent guest of television and radio talkshows, he has commented on Russian affairs for, among others, 60 Minutes,The Newshour with Jim Lehrer, Charlie Rose, CNN International,C-Span, and National Public Radio’s “All Things Considered” and “Talk of theNation.”


    From 1990 to 2004, he was a permanent discussant at the Voice of America’s radio and television show Gliadya iz Ameriki (“Looking from America”), which was broadcast to Russia every week.

  • Phone: 202-862-5898
    Email: laron@aei.org

  • Assistant Info

    Name: Daniel Vajdic
    Phone: 202-862-5942
    Email: daniel.vajdic@aei.org
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Dan
Blumenthal
  • Dan Blumenthal is a current commissioner and former vice chairman of the U.S.-China Economic and Security Review Commission, where he directs efforts to monitor, investigate, and provide recommendations on the national security implications of the economic relationship between the two countries. Previously, he was senior director for China, Taiwan, and Mongolia in the Secretary of Defense's Office of International Security Affairs and practiced law in New York prior to his government service. At AEI, in addition to his work on the national security implications of U.S.-Sino relations, he coordinates the Tocqueville on China project, which examines the underlying civic culture of post-Mao China. Mr. Blumenthal also contributes to AEI's Asian Outlook series and is a research associate with the National Asia Research Program.
  • Phone: 202-862-5861
    Email: dblumenthal@aei.org

  • Assistant Info

    Name: Lara Crouch
    Phone: 202-862-7160
    Email: lara.crouch@aei.org
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Alex
Brill
  • Alex Brill, a former policy director and chief economist of the House Ways and Means Committee, also served on the staff of the President's Council of Economic Advisers (CEA). In Congress and at the CEA, Mr. Brill worked on a variety of economic and legislative policy issues, including dividend taxation, the alternative minimum tax, international tax policy, social security reform, defined benefit pension reform, and U.S. trade policy.

    At AEI, Mr. Brill studies the impact of tax policy in the U.S. economy; the fiscal, economic, and political consequences of stimulus legislation; health care reform, pharmaceutical spending, unemployment insurance reform; and financial innovation and technology.
  • Phone: 202-862-5931
    Email: alex.brill@aei.org

  • Assistant Info

    Name: Chad Hill
    Phone: 202-862-5862
    Email: chad.hill@aei.org
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Thomas
Donnelly
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Kevin A.
Hassett
  • Before joining AEI, Mr. Hassett was a senior economist at the Board of Governors of the Federal Reserve System and an associate professor of economics and finance at the Graduate School of Business of Columbia University, as well as a policy consultant to the Treasury Department during the George H. W. Bush and Clinton administrations. He served as an economic adviser to the George W. Bush 2004 presidential campaign and as Senator John McCain's chief economic adviser during the 2000 presidential primaries. He also served as a senior economic adviser to the McCain 2008 presidential campaign. Mr. Hassett is a columnist for National Review.

  • Phone: 202-862-7157
    Email: khassett@aei.org

  • Assistant Info

    Name: Veronika Polakova
    Phone: 202-862-4880
    Email: veronika.polakova@aei.org
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Lawrence B.
Lindsey
  • Lawrence B. Lindsey has held leading positions in government, academia, and business. He has been assistant to the president and director of the National Economic Council at the White House. He also served as a governor of the Federal Reserve System, special assistant to the president for domestic economic policy, and senior staff economist for tax policy at the President's Council of Economic Advisers. Mr. Lindsey taught economics at Harvard University and is currently president and CEO of the Lindsey Group. He is the author of Economic Puppet Masters (AEI Press, 1999) and The Growth Experiment (Basic Books, 1990).
  • Phone: 7032183950
    Email: llindsey@aei.org
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Thomas P.
Miller
  • Thomas Miller is a former senior health economist for the Joint Economic Committee (JEC). He studies health care policy and regulation. A former trial attorney, journalist, and sports broadcaster, Mr. Miller is the co-author of Why ObamaCare Is Wrong For America (HarperCollins 2011) and heads AEI's "Beyond Repeal & Replace" health reform project. He has testified before Congress on issues including the uninsured, health care costs, Medicare prescription drug benefits, health insurance tax credits, genetic information, Social Security, and federal reinsurance of catastrophic events. While at the JEC, he organized a number of hearings that focused on reforms in private health care markets, such as information transparency and consumer-driven health care.
  • Phone: 202-862-5886
    Email: tmiller@aei.org

  • Assistant Info

    Name: Catherine Griffin
    Phone: 202-862-5920
    Email: catherine.griffin@aei.org
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Danielle
Pletka
  • Danielle Pletka is the vice president for foreign and defense policy studies at AEI. Before joining AEI, she served for ten years as a senior professional staff member for the Near East and South Asia on the Senate Committee on Foreign Relations. She writes frequently on national security matters with a focus on domestic politics in the Middle East and South Asia regions, U.S. national security, terrorism and weapons proliferation.
  • Phone: 202-862-5943
    Email: dpletka@aei.org

  • Assistant Info

    Name: Lazar Berman
    Phone: 202-862-5872
    Email: lazar.berman@aei.org
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Vincent R.
Reinhart
  • Vincent Reinhart, a former director of the Federal Reserve Board's Division of Monetary Affairs, joined AEI in 2008 after working on domestic and international aspects of U.S. monetary policy at the Fed for more than two decades. He held a number of senior positions in the Divisions of Monetary Affairs and International Finance and served for the last six years of his Federal Reserve career as secretary and economist of the Federal Open Market Committee. Mr. Reinhart worked on topics as varied as economic bubbles and the conduct of monetary policy, auctions of U.S. Treasury securities, alternative strategies for monetary policy, and the efficient communication of monetary policy decisions. At AEI, he has continued his work on all of the above in addition to research on key economic variables before and after adverse global and country-specific shocks, policy mistakes leading to the 2007-09 financial meltdown, and the implementation and impact of quantitative easing.
  • Email: vincent.reinhart@aei.org

  • Assistant Info

    Name: Rohan Poojara
    Phone: 202-862-5852
    Email: rohan.poojara@aei.org
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Gary J.
Schmitt
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