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AT HIS RIGHT HAND Barack Obama and Valerie Jarrett getting lunch last week in Chicago. Ms. Jarrett took Mr. Obama under her wing nearly two decades ago.

AT HIS RIGHT HAND Barack Obama and Valerie Jarrett getting lunch last week in Chicago. Ms. Jarrett took Mr. Obama under her wing nearly two decades ago.

 

CHICAGO — On a dark afternoon last week, the road to Jerusalem and Beijing momentarily veered through the office of a real estate company here.

Valerie Jarrett, the company’s chief executive, had signed her resignation letter an hour earlier, and now she was taking phone calls from potential top diplomatic appointees.

“You don’t need to thank me,” she said soothingly to a booming male voice on her cellphone. “I just wanted you to have a chance to make your case.”

If someone were to rank the long list of people who helped Barack and Michelle Obama get where they are today, Ms. Jarrett would be close to the top. Nearly two decades ago, Ms. Jarrett swept the young lawyers under her wing, introduced them to a wealthier and better-connected Chicago than their own, and eventually secured contacts and money essential to Mr. Obama’s long-shot Senate victory.

In the crush of his presidential campaign, Ms. Jarrett could have fallen by the wayside, as old mentors often do. But the opposite happened: Using her intimacy with the Obamas, two BlackBerrys and a cellphone, Ms. Jarrett, a real estate executive and civic leader with no national campaign experience, became an internal mediator and external diplomat who secured the trust of black leaders, forged peace with Clintonites and helped talk Mr. Obama through major decisions.

She “automatically understands your values and your vision,” Michelle Obama said in a telephone interview Friday, and is “somebody never afraid to tell you the truth.” Mrs. Obama added: “She knows the buttons, the soft spots, the history, the context.”

In January, Ms. Jarrett will go to the White House as a senior adviser to Mr. Obama, where she will be “one of the four or five people in the room with him when decisions get made,” as Anita Dunn, a Democratic strategist close to Mr. Obama, put it. Ms. Jarrett, who is a co-chairwoman of Mr. Obama’s transition effort, will also serve as the White House contact for local and state officials across the nation and the point person for Mr. Obama’s effort to build a channel between his White House and ordinary Americans.

Less formally, she intends to help Mr. Obama preserve his essential self as he becomes president, even as she becomes the type of person who chats with Gov. Arnold Schwarzenegger of California, mingles with Warren Buffett and is now sometimes greeted by strangers.

Washingtonians who assess the new White House crew sometimes cast Ms. Jarrett in parochial terms: she is the hometown buddy, they say, or the one who will hear out the concerns of black leaders. They note that presidential friends do not always fare well in the capital, that confidants from Arkansas and Texas have stumbled in the corridors of the West Wing.

Asked what was her biggest worry about the job, which is a major leap from anything she has undertaken before, Ms. Jarrett said she sometimes feared she did not know enough. “I will try to do my homework,” she said.

Ms. Jarrett, 52, has often been underestimated: perhaps because she is often the only black woman at the boardroom tables where she sits, or perhaps because she can seem girlish, with a pixie haircut, singsong voice and suits that earned her a recent profile in Vogue.

A protégée of Mayor Richard M. Daley of Chicago, Ms. Jarrett served as his planning commissioner, ran a real estate company, the Habitat Company — whose management of public housing projects has come under scrutiny with Ms. Jarrett’s rise — and sits on too many boards to count. She is an expert in urban affairs, particularly housing and transportation, in an administration expected to lavish more money and attention on cities than its predecessors.

And she has something no other adviser in the Obama White House ever will: ties to the president-elect and future first lady that go deeper than a political alliance. Ms. Jarrett is only a few years older than the Obamas, but her relationship with them can seem almost maternal. “I can count on someone like Valerie to take my hand and say, You need to think about these three things,” Mrs. Obama said. “Like a mom, a big sister, I trust her implicitly.”

During big speeches, Ms. Jarrett watched Mr. Obama with a gaze of such intensity that he and their other friends laugh about it. “Barack always jokes, You can’t look Valerie in the eye, she’s going to make you cry,” said Martin Nesbitt, the treasurer of the campaign.

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No v. 21 (Bloomberg) — President-Elect Barack Obama’s transition team is exploring a swift, prepackaged bankruptcy for automakers as a possible solution to the industry’s financial crisis, according to a person familiar with the matter.

A representative of Obama’s team has already contacted at least one bankruptcy-law firm to say that Daniel Tarullo, a professor at Georgetown University’s law school who heads Obama’s economic policy working group, would call to discuss the workings of a so-called prepack, according to this person.

U.S. lawmakers yesterday delayed until December a vote on whether to give General Motors Corp., Ford Motor Co. and Chrysler LLC a $25 billion bailout. GM today said it would idle production at four plants an extra week and return some corporate jets to conserve cash. Automakers could use a judge-supervised bankruptcy to reduce debt and reject expensive contracts.

“It creates the environment to deal with GM’s problems but limits government financial commitment,” said bankruptcy lawyer Mark Bane of Ropes & Gray in New York.

Bankruptcy is just one option being examined. Obama told CBS News’s “60 Minutes” on Nov. 16 that government aid to automakers might come in the form of a “bridge loan,” advanced if the industry could draw up plan to make itself “sustainable.” The president-elect earlier urged Congress to approve as much as $50 billion to save automakers, using the model of Chrysler’s bailout in 1979.

Tarullo referred questions on a prepack to the transition team press office. Team spokeswoman Stephanie Cutter said, “We have not put out anything specific for the auto industry except that something needs to be done immediately.”

No Cash

GM, the largest U.S. automaker, said it might run out of cash as early as the end of the year and that the risk was even greater by mid-2009. GM Chief Executive Officer Rick Wagoner said this week GM would have to liquidate if it filed for bankruptcy.

The automaker probably has weeks rather than months left before it runs out of money unless it gets federal aid, Jerome York, an adviser to billionaire Kirk Kerkorian and a former GM board member, told Bloomberg Television yesterday.

In a prepackaged bankruptcy, an automaker would go into court with financing in hand after reaching agreement with lenders, workers and suppliers on what each would give up and on the business plan to be followed. The process might take six to 12 months, compared with two to five years if the automakers followed an ordinary Chapter 11 proceeding and worked out agreements under a judge’s supervision, Bane said.

Government Financing

Automakers would have to depend on government financing to restructure in bankruptcy court and probably couldn’t attract private loans until they were ready to emerge from the process, Bane said.

Officials of the three automakers told members of Congress this week that they had studied a pre-arranged bankruptcy, championed by Republican lawmakers such as Senator Bob Corker of Tennessee, before dismissing the idea as unworkable.

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11-12-2008-11-03-21-am

WASHINGTON — Turning to campaign promises in which he pledged sweeping ethics restrictions, President-elect Barack Obama will bar lobbyists from helping to pay the costs of his transition to power or working for it in any area in which they have represented clients in the last year, his transition team said Tuesday.

Mr. Obama’s aides indicated that they expected the rules to apply to his inauguration as well as the transition, but said they had yet to make a final decision on how the inauguration would be paid for.

John D. Podesta, a co-chairman of the Obama transition, called the restraints “the strictest, the most far-reaching ethics rules of any transition team in history.”

“If someone has lobbied during the past 12 months, they’re prohibited from working in the fields of policy on which they lobbied and will have to cease all lobbying activities during their work on the transition,” Mr. Podesta said, speaking to reporters in the first official briefing by the transition team.

But the new rules do seem to leave some wiggle room. Aides to Mr. Obama, who declared during the campaign that lobbyists would not “find a job in my White House,” said the guidelines allowed for lobbyists to work on the transition in areas where they have not done any lobbying.

Further, the rules apply to lobbyists who must register with the federal government; many people who work for lobbying firms or in other areas of the influence business in Washington do not have to register, because they do not personally lobby federal officials on specific issues.

Mr. Podesta said he expected the transition to employ some 450 people and have a budget of about $12 million. Of that amount, $5.2 million will be paid by the government, with the remaining $6.8 million coming from private sources, he said. Contributions will be limited to $5,000, he said, and the transition will not accept money from political action committees.

During a presidential campaign in which he raised $650 million, Mr. Obama changed the rules of fund-raising, declining public financing and creating his own multimillion-member chain of donors. At least some of those contributors will be solicited for the transition.

As a candidate, Mr. Obama laid out more detailed and onerous ethics rules than any previous prospective president, pledging to bar appointees for two years from working on matters involving their former employers, to prohibit departing officials from lobbying his administration for its duration and to require all political appointees to disclose publicly every meeting with registered lobbyists.

The rules have led to some grumbling that at a time of immense challenges, an Obama administration could be excluding a pool of substantial talent by stopping people from working for the White House in the areas they know best.

“I’ve heard the complaint,” Mr. Podesta said, “which is we’re leaving all this expertise on the side, because we’re leaving all the people who know everything out in the cold. And so be it. This is a commitment that the American public expects, and it’s one that we intend to enforce during the transition.”

It remains unclear how the rules will affect the inauguration. President Bush raised more than $40 million for his second inauguration, mostly from companies and executives.

While aides to Mr. Obama say they are keenly aware that a lavish celebration might not be well received given the faltering economy, they indicate that the historic nature of Mr. Obama’s inauguration and the expectations of high turnout all but guarantee that the occasion, on Jan. 20, will be a huge one.

Yet in one early sign that the celebrations are likely to be somewhat scaled back, Mr. Obama canceled fireworks on election night in Grant Park in Chicago, telling his advisers that the times were too serious for that type of festivity.

“It’s going to be a balancing act,” one Obama aide said, “and I’m not sure how it’s going to be done.”

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President-elect Barack Obama (center) during his first press conference, in Chicago, following his election victory, Nov. 7, 2008.

President-elect Barack Obama (center) during his first press conference, in Chicago, following his election victory, Nov. 7, 2008.

It’s proving difficult to peer inside Obama’s still tightly closed Cabinet. But so far his presidential transition has looked deliberate and impressive.

Nov. 11, 2008 | Amid the fervid speculation over the identity of the next secretary of state or even the next assistant secretary of labor for administration and management, there is a truth that is galling to gossip-mongers — Barack Obama and his closest advisors know how to keep secrets. With nearly 10 percent of the transition period between administrations already gone, we know more about the factors that will dictate the selection of the White House puppy than we do about the reasoning behind the choice of a would-be Treasury secretary.

As Valerie Jarrett, co-chair of Obama’s transition team, put it with deliberate blandness on “Meet the Press” Sunday: “I think one of the real strengths of Sen. Obama’s campaign and now President-elect Obama’s transition is that he really does like to think this through thoroughly and not telecast what he’s going to do until he’s ready to make a decision.”

No one wants to read articles titled “Entire Obama Administration Shrouded in Mist and Mystery.” So to accentuate the positive, we do have a pretty reliable handle as to who will be in the room with Obama (and presumably Joe Biden) when the major personnel decisions are made. There will be Jarrett, an African-American Chicago real estate entrepreneur who has been close friends to the president-elect and the incoming first lady for two decades; Pete Rouse, the press-shy former chief of staff for Senate Majority Leader Tom Daschle, who performed the same role for a newly elected Illinois senator named Obama; the Chicago-born John Podesta, Bill Clinton’s former White House chief of staff, who stealthily organized the Obama transition during the fall campaign from his Washington perch at the Center for American Progress; David Axelrod, the Chicago-based political strategist, who was the inspiration behind both Obama’s up-from-nowhere 2004 Senate victory and his 2008 run for the Rose Garden; and incoming White House chief of staff Rahm Emanuel, a sharp-elbowed veteran of the Clinton White House who was elected to Congress in 2002 (from Chicago, natch) with the help of Axelrod (double natch).

With all these Chicagoans (aside from Rouse) creating the Obama administration, it is time to drop the Second City urban inferiority complex. If there is an ideological orientation to this team, it seems to be Democratic centrism rather than full-throated liberalism. Bill Galston, a former top domestic advisor to Clinton now at the Brookings Institution, notes that Obama “has a great respect for expertise. His instinct is that in any field, gather the leading experts and go after them.” As Galston puts it, “This is not amateur hour — this is not crony time.” Paul Light, a professor of public service at New York University and an expert on governmental organization, said admiringly, “Obama is extremely well-prepared. There is a lot of talk coming out of the Bush administration about a seamless transition. But in many instances, the Obama people know as much about what is happening in the Cabinet agencies as the Bush people do.”

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Valerie Jarrett is one of Barack Obama's closest advisers.

Valerie Jarrett is one of Barack Obama

(CNN) — Two Democratic sources close to President-elect Barack Obama tell CNN that top adviser Valerie Jarrett will not be appointed to replace him in the U.S. Senate.

“While he (Obama) thinks she would be a good senator, he wants her in the White House,” one top Obama advisor told CNN Monday.

Over the weekend, Democratic sources had told CNN as well as Chicago television station WLS-TV that Jarrett was Obama’s choice to fill his Senate seat.

Jarrett, a Chicago attorney and one of Obama’s closest advisers, is a leader of the president-elect’s transition team.

Illinois Rep. Rahm Emanuel, the incoming White House chief of staff, praised her as a “valuable ally.”

“People should know that Valerie Jarrett is — and people do know — she is a very dear friend of the president-elect and a valuable ally of his, not only prior to running for president, in his Senate life, and just personally for Michelle and Barack,” Emanuel said on ABC’s This Week.

Valerie Jarrett Obama’s secret campaign weapon:

Several other Illinois Democrats have expressed interest in the seat, including Rep. Jesse Jackson Jr.

Illinois governor Rod Blagojevich will make the final decision on Obama’s successor.

Source: CNN

Obama to act swiftly on economy

Senator Barack Obama kissed his daughter Malia while his wife, Michelle, looked on Tuesday night in Chicago.

Senator Barack Obama kissed his daughter Malia while his wife, Michelle, looked on Tuesday night in Chicago.

President-elect Barack Obama began moving Wednesday to build his administration and make good on his ambitious promises to point the United States in a different direction, as his commanding victory reordered the American political landscape and transfixed much of the nation and the world.

A day after becoming the first African-American to capture the presidency, Mr. Obama announced a transition team and prepared to name an ally as his White House chief of staff in his first steps toward assuming power. President Bush vowed to work closely with Mr. Obama to ensure a smooth transition in the first handover since the attacks of Sept. 11, 2001.

Representative Rahm Emanuel of Illinois, the fourth-ranking House Democrat and a close friend of Mr. Obama’s from Chicago, has been offered the job of chief of staff, and although he was said to be concerned about the effects on his family and giving up his influential role on Capitol Hill, many Democrats said they expected him to accept it. Mr. Obama named John D. Podesta, the former Clinton White House chief of staff, to lead his transition team along with Valerie Jarrett, a longtime adviser, and Pete Rouse, his Senate chief of staff.

In turning to Mr. Emanuel and Mr. Podesta, Mr. Obama sought out two of the hardest-hitting veterans of President Bill Clinton’s administration, known for their deep Washington experience, savvy and no-holds-barred approach to politics. Neither is considered a practitioner of the “new politics” that Mr. Obama promised on the campaign trail to bring Republicans and Democrats together, suggesting that the cool and conciliatory new president is determined to demonstrate toughness from the beginning.

Mr. Obama stayed largely out of sight on Wednesday as Democrats counted their gains and Republicans stewed over what went wrong. The scope of his success underscored the nation’s discontent with Mr. Bush’s presidency. Mr. Obama captured an estimated 52 percent of the popular vote and 349 electoral votes to John McCain’s 46 percent and 162 electoral votes, with Missouri and North Carolina still too close to call.

Mr. Obama also ushered in a wave of Democrats who strengthened his party’s hold over Congress, picking up at least five seats in the Senate and 19 in the House. Republican senators in Alaska, Minnesota and Oregon were still clinging to razor-thin leads, including Ted Stevens of Alaska, fresh from his conviction on seven felony counts of failing to disclose $250,000 in gifts and services he received.

President-elect Barack Obama, shown leaving a hotel in Chicago on Wednesday, spent the day with his family and with transition advisers.

President-elect Barack Obama, shown leaving a hotel in Chicago on Wednesday, spent the day with his family and with transition advisers.

But the crowds had barely drifted out of Grant Park in Chicago after an exuberant late-night celebration of Mr. Obama’s triumph before the rising sun brought fresh signs of the daunting burdens to come.

In Russia, President Dmitri A. Medvedev warned that he would deploy missiles if Mr. Obama built Mr. Bush’s planned missile defense system in Eastern Europe. In Afghanistan, President Hamid Karzai pleaded with Mr. Obama to halt air strikes that have been killing civilians. And in the United States, stock markets plunged again amid more dark economic news.

Still, the phenomenon of a black president of the world’s most powerful nation captured public imagination in many quarters of the globe. Supporters in many cities in the United States chanted in the street and large crowds gathered at the headquarters of newspapers such as The New York Times and The Washington Post seeking sold-out copies of historic front pages.

The Congressional committee that puts together the inauguration ceremonies announced that the theme would be “A New Birth of Freedom,” to mark the 200th anniversary of Abraham Lincoln’s birth, symbolically linking one president from Illinois who freed the slaves to another who broke the ultimate racial barrier in politics.

Even the departing Bush team recognized the power of the moment. “It will be a stirring sight to watch President Obama, his wife, Michelle, and their beautiful girls step through the doors of the White House,” Mr. Bush told reporters in the Rose Garden. “I know millions of Americans will be overcome with pride at this inspiring moment that so many have awaited for so long.”

Secretary of State Condoleezza Rice made a surprise appearance at her department’s daily briefing to congratulate Mr. Obama.

“As an African-American, I am especially proud because this is a country that’s been through a long journey in terms of overcoming wounds and making race not the factor in our lives,” Ms. Rice said. “That work is not done, but yesterday was obviously an extraordinary step forward.”

The election proved so invigorating to the American public that turnout climbed to its highest rate in 44 years. Although experts differed in their projections as provisional and absentee ballots are counted, Michael McDonald, a voting expert at George Mason University, estimated that 133.3 million people had voted, eclipsing the 123 million who participated four years ago. That amounted to 62.6 percent of all eligible voters, just shy of the 62.8 percent in 1964.

With the election now behind them, the Bush and Obama teams began the delicate 77-day transition until inauguration. The General Services Administration turned over 120,000 square feet of office space in downtown Washington to the Obama transition team and select Obama advisers were due to be given interim security clearances.

Mr. Obama and Vice President-elect Joseph R. Biden Jr. will receive briefings Thursday from Mike McConnell, the director of national intelligence, and thereafter each morning by a pair of Central Intelligence Agency officials. Mr. Obama was given brief updates during the campaign, but aides said the sessions now would resemble the presidential daily briefing presented to Mr. Bush each morning.

By 8 PM the crowds had filled the green in front of the stage. Teaming.jpg

By 8 PM the crowds had filled the green in front of the stage. Teaming.jpg

Beyond choosing staff members, Mr. Obama must decide how active he intends to be in asserting leadership during the transition. Mr. Obama has conferred with Congressional leaders about passing a $100 billion economic stimulus package in a lame-duck session the week of Nov. 17 to pay for public works projects, aid to cities and states, and unemployment, food stamp and heating benefits.

But Congressional aides said that if Mr. Obama could not win agreement from Mr. Bush and Senate Republicans, they might scale the package back to about $60 billion, then come back in January with a broader plan.

Mr. Obama talked regularly with Treasury Secretary Henry M. Paulson Jr. about the financial crisis during the campaign, but it remained unclear how closely he wants to coordinate action during the transition. The situation is so dire, it may demand immediate action from a newly elected president, but Obama advisers are wary of taking ownership over decisions made by Mr. Bush.

On his first morning as president-elect, Mr. Obama did something he rarely did the last 22 months: he woke up at home in Chicago and had breakfast with his wife, Michelle, and his two young daughters, Malia and Sasha. He spent the day out of view, making thank you calls and meeting with transition advisers, a decision aides said was intended to draw a line between the campaign and the coming task of governing. They said he canceled fireworks at the Tuesday night celebration to underscore the seriousness of the moment.

As he began to assemble his White House, Mr. Obama sought to persuade Mr. Emanuel to be his right hand. Mr. Emanuel, a top aide in the Clinton White House, did not accept immediately, with close associates saying he was torn between helping the new administration and staying in the House, where he aspires to become speaker. His wife and three children, who live in Chicago, are reluctant to move to Washington, friends said.

Mr. Emanuel would bring extensive legislative experience and instincts for how to run a White House, but his brash partisan past could undercut Mr. Obama’s promise to bridge the divide in Washington. His unquestioned loyalty to Mr. Obama is a powerful asset to the president-elect.

Cardboard cutouts of Senator Barack Obama and Senator Joseph R. Biden Jr. on display in Washington, D.C.

Cardboard cutouts of Senator Barack Obama and Senator Joseph R. Biden Jr. on display in Washington, D.C.

While waiting to settle the matter with Mr. Emanuel, Mr. Obama went ahead and announced his transition team, to be led by Mr. Podesta, Ms. Jarrett and Mr. Rouse. They will be helped by a 12-member board, including Gov. Janet Napolitano of Arizona, former Commerce Secretary William Daley, former Energy Secretary Federico F. Peña and former Environmental Protection Agency director Carol Browner.

Washington was abuzz with speculation over who would join the new administration, some of it informed, much of it guesswork. Democrats close to the Obama team said they believed the likeliest choices for Treasury secretary would be Lawrence H. Summers, who held the post in the Clinton administration, and Timothy F. Geithner, president of the Federal Reserve Bank of New York.

In the national security arena, much depends on whether Mr. Obama decides to ask Defense Secretary Robert M. Gates to stay to demonstrate bipartisanship. If Mr. Obama decides against it, or Mr. Gates turns him down, Democrats see former Deputy Defense Secretary John J. Hamre and former Navy Secretary Richard J. Danzig as two candidates for the Pentagon.

Without Mr. Gates, Mr. Obama might want to tap a Republican for the State Department, perhaps including Senators Richard G. Lugar of Indiana or Chuck Hagel of Nebraska, advisers said. If Mr. Gates stays, some Democrats said, Senator John F. Kerry, the Democratic nominee who gave Mr. Obama the platform at the 2004 convention that vaulted him to national fame, is a leading choice to be secretary of state.

For national security adviser, Mr. Obama might pick between James B. Steinberg, a former deputy national security adviser, and Gregory B. Craig, a former State Department official. Mr. Danzig and Dennis Ross, a longtime Middle East envoy, are also mentioned. Susan E. Rice, a former assistant secretary of state and early Obama adviser, is often described as a possible deputy national security adviser or ambassador to the United Nations.

Democrats said they had heard that Howard Dean, the Democratic National Committee chairman, who is a doctor, might be a candidate for secretary of health and human services; Representative James E. Clyburn of South Carolina may be considered for secretary of housing and urban development; and Penny S. Pritzker, a Chicago business tycoon and Mr. Obama’s national finance chairwoman, could be tapped for commerce secretary.

While Mr. Bush invited his successor-to-be to visit him at the White House, Mr. Obama’s advisers said that he had no immediate plans to travel to Washington and that he planned to chart out his new administration largely from Chicago. He does not plan to attend the global economic summit in Washington called by Mr. Bush for Nov. 15. But advisers did not rule out the possibility that he would meet with some visiting leaders, perhaps over dinner or at a reception.

“The one thing he is not going to do is let anyone think he’s undermining the president,” said Mr. Craig, who has advised Mr. Obama on foreign policy. “There’s only one president, and he’ll take pains to make sure nothing he does is taken as undermining President Bush.”

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