Tea Leaves

Senator Daschle's withdrawal yesterday was surprising. His unpaid taxes were larger than Geithner's, but the underlying error -- confusion over imputed income -- is much more plausible. The stories about his lobbying/advisory income were embarrassing, but surely all of that was disclosed in vetting and to the committee and didn't constitute real news. Killefer's withdrawal put him in an awkward place, but her issues seem trivial and the Administration could have chosen to stick it out with her, too. Daschle seemed personally important to the President, and could expect tremendous sympathy on the Hill. What happened?

The key event seems to be the Times editorial calling for his withdrawal. Obama benefits from extraordinarily generous coverage, which has helped through many tight spots. He can't afford to hurt that relationship, and he can't afford to let an opinion leader like the Times get the idea that he might not be so very new. He certainly doesn't want to invite scrutiny of every nominee going forward.

But the Times' piece is itself surprising. Daschle's steady, prudent advancement of the welfare state is just their sort of thing; and while he might be cozy with the very companies he would regulate, that sort of thing is nothing new. It's very unlikely that any Obama proposal would seriously damage that industry. Perhaps the Times realized the conflicts in the Senator's work history, but frankly these are judgement calls and I would have expected the Times to look the other way.

I have two speculations. One, Daschle's dual appointment in the White House and at HHS was very unusual. This would have given him control over the information on health finance emerging from HHS, and over the flow of that information in the White House. While no one can lock down the information stream from an institution as large as HHS, Daschle's White House spot positioned him to know of "back channel" flows, and either stem them or counter them. This would have given him extraordinary control over the shape of the health care debate, and would have starved rival opinions of the raw data needed to shape arguments.

That information advantage would have threatened all sorts of people. For example, the WH chief of staff, whose influence derives from controlling information himself and whose job requires presenting the President with alternatives. And anyone hoping to play in the health care debate -- OMB, Treasury, the National Economics Council, the Domestic Policy Council -- would need information ultimately sourced from HHS. It would also have threatened the Times, whose reporters depend on leaks from these various sources to do their jobs. It's possible that this moved the Times. It's also possible that the President didn't really understand the position he'd conferred on Daschle by acceding to this dual arrangement, discovered the problem as he began building his management structure, and didn't mind so much letting this issue remove the problem. If so, the Times editorial could well have been cued from the White House.

Or, the Times had an ax of its own to grind. We read in the Washington Post:

"Daschle has frequently weighed in on communications policy and Adelstein [former Daschle staffer on the FCC] has often expressed the same views. In 2004, for example, Daschle sent an aide to an FCC hearing chaired by Adelstein in South Dakota to register his opposition to rules proposed by a Republican member that allowed owners of television stations to purchase newspaper and radio stations in the same town.

"Hindery [Daschle's sponsor at InterMedia], the former chief executive of AT&T's broadband and telecommunications division and New York regional sports channel the YES Network, also opposed the proposed rules, which would favor large companies such as Newscomm or Viacom over the smaller firms in which InterMedia had invested. The rules drew criticism from other Democratic lawmakers and Adelstein. "

(See here.)

It isn't hard to imagine the New York Times, itself a pretty large media company, objecting to rules that limit its ability to buy things like local TV stations, or to sell itself to companies that do. I know nothing of the media business, but it's at least worth asking if the Times worried that Daschle's reach might extend into shaping telecommunications policy to the advantage of (apparently) smaller players like InterMedia to the detriment of larger ones like the Times. If so, the Times' is important enough to the President that their signal of displeasure was surely enough to decide the matter.

In short, I am not convinced we have the full story here. Daschle had issues, but they were subject to interpretation and didn't constitute anything new. The whole thing could have gone either way, and Daschle is the sort of figure for which double standards were invented. Obama's supporters and progressives will surely be satisfied by the "things are changing" explanation, and maybe they are. But I think that explanation assumes that people will stop acting in their own interests, which I think unlikely, and thus isn't as simple as it looks.

The other nugget in this is the importance of media opinion leaders like the Times. Obama has surely benefited from their coverage, and surely can be expected to set the agenda. But the media do control their own standards, at least at the margin, and the Administration can't afford a fight with them. The demonstration of that importance could be a third candidate for explaining the Times' piece.