The Note: Looking Back — Baggage crowds out Obama agenda — even on vacation

By RICK KLEIN So much for not making news. Afghanistan, new deficit figures, a fresh political battle over interrogation techniques — that’s quite the haul of baggage President Obama got to bring with him to Martha’s Vineyard. It makes for plenty of reading for the president even if he doesn’t pick up the Richard Price novel or the Tom Friedman book (again). It’s an impressive series of challenges for a president who really doesn’t want to be looking backward. (And notice how the issue of the month isn’t even on the list.) For starters — getting out in front of new deficit numbers with a choice Wall Street is cheering. Fed Chairman Ben Bernanke gets named to a second term at 9 am ET, with President Obama taking a break from his vacation to make the announcement — with Bernanke at his side — from Martha’s Vineyard. From the president’s prepared remarks: “Ben approached a financial system on the verge of collapse with calm and wisdom; with bold action and outside-the-box thinking that has helped put the brakes on our economic freefall. Almost none of the decisions he or any of us made have been easy. The actions we have taken to stabilize our financial system, repair our credit markets, restructure auto industry, and help the overall economy recover have all been steps of necessity, not choice. They have faced plenty of critics, some of whom argued that we should stay the course or do nothing at all. But taken together, all of these steps have brought our economy back from the brink. They are steps that are working.” “The president is expected to praise Bernanke for his courage, temperament, and creativity,” ABC’s Yunji de Nies reported on “Good Morning America” Tuesday. A White House aide tells de Nies: “The president wanted the team that has been working to rescue this economy together. This continuity is crucial, and Rahm [Emanuel], [Tim] Geithner and Larry [Summers] all recommended to the president that Bernanke be retained to ensure this continuity. Larry is of course staying, first because no one can do what Larry can as the president’s right hand-advisor on the economy, and because the president wants and needs his whole economic team together.”  It’s “opting for continuity in U.S. economic policy despite criticism in Congress of the low-key central banker's frantic efforts to rescue the financial system,” per The Wall Street Journal’s Jon Hilsenrath, David Wessel, and Sudeep Reddy. “White House chief of staff Rahm Emanuel said the president credits Mr. Bernanke for ‘pulling the economy back from the brink of depression.’ “  “The Fed chief will still face tough questioning from lawmakers who say he was slow to recognize the severity of the mortgage crisis and didn’t do enough to protect American consumers while leading bailouts of financial firms including Bear Stearns Cos. and American International Group Inc.,” Bloomberg’s Julianna Goldman and Scott Lanman report.  The statement from Senate Banking Chairman Chris Dodd, D-Conn.: “Chairman Bernanke was too slow to act during the early stages of the foreclosure crisis, but he ultimately demonstrated effective leadership and his reappointment sends the right signal to the markets. There will be a thorough and comprehensive confirmation hearing.” The context (or, why this is being done five months early, while the president is on vacation): “Big news on the economic front, no doubt meant to divert us from those large, unpleasant numbers. But they are not so easily buried,” Politics Daily’s Jill Lawrence writes. “Even now the projections are a threat to Obama's plans on health, energy and climate change – plans he campaigned on but, unlike Clinton, is insisting on pursuing in the teeth of a recession.” Ah yes — the deficit is growing to $9 trillion over 10 years, from $7 trillion, as of the new announcement to come Tuesday morning. (There’s a health care bill or two right there.) “Get ready to hear a lot of huge numbers Tuesday: The Obama administration is expected to boost its estimate of the federal deficit over the next decade by $2 trillion, a move likely to trigger political wrangling over who's to blame and how harmful all the red ink will be,” the AP’s Christopher S. Rugaber reports.  The Office of Management and Budget releases its “mid-session review” for the fiscal year at 9:30 am ET. And the Congressional Budget Office’s summer budget update comes at 11 am ET. Any other diversions ready? The CIA probe is precisely the sort of political bind the president has sought to avoid — looking backward, not nearly satisfying the demands of the left, and engaging the right. It will last for months — and may not result in anything that either side of the political debate finds appropriate. “Attorney General Eric Holder has struck a middle course that isn't likely to satisfy anyone and could complicate President Barack Obama's broader political agenda,” McClatchy’s Margaret Talev writes. (Headline: “If you liked health care brawls, you'll love CIA torture probe.”)   “The Obama administration has plunged into just the kind of controversy it said it wanted to avoid — a polarizing, backward-looking fight over issues far removed from the president's top priorities,” Christi Parsons and Julian E. Barnes report in the Los Angeles Times. “At a time when healthcare and other signature initiatives are in trouble on Capitol Hill and President Obama's approval ratings are slipping, he now faces the prospect of a long, distracting probe into policies of the Bush administration — policies Obama has already denounced.”  “Since special prosecutors' inquiries have a history of running on for years, generating news and controversy at almost every stage, the polarization of left and right suggests Obama is likely to be dealing with the interrogation issue for the foreseeable future,” they write. It’s “a game-changing move that could upend President Barack Obama's broader agenda,” Julie Mason writes in the Washington Examiner. “It also creates a tricky calculus for the president's war strategies — some of which, such as rendition, are continuations of former President George W. Bush's policies.”  Not that there’s anything else he’d rather be doing: “President Barack Obama is battling to save his health-care plan, fortify the war effort in Afghanistan, restart Middle East peace negotiations, lay the groundwork for sanctions against Iran, close the Guantanamo Bay prison, bring the U.S. into a global climate-change effort, and end a global recession,” The Wall Street Journal’s Jonathan Weisman writes.  “Now, he faces a political outcry over the Central Intelligence Agency, triggered by Attorney General Eric Holder's decision Monday to appoint a prosecutor to examine whether to bring charges against agency interrogators. The divisions could hamper Mr. Obama's attempt to move ahead on, and seek Republican support for, a range of tricky domestic and foreign-policy matters.” “The decision was a significant blow to the C.I.A, and Mr. Holder said he would be criticized for undercutting the intelligence agency’s work,” Mark Mazzetti and Scott Shane write in The New York Times. “He said that he agreed with President Obama’s oft-expressed desire not to get mired in disputes over the policies of former President George W. Bush, but that his review of reports on the C.I.A. interrogation program left him no choice.”  Senate Intelligence Committee Vice Chairman Kit Bond, R-Mo. (a guest on ABCNews.com’s “Top Line” at noon ET): “With a criminal investigation hanging over the Agency’s head, every CIA terror fighter will be in CYA mode.” Sen. Joe Lieberman, I-Conn.: “These public servants must of course live within the law but they must also be free to do their dangerous and critical jobs without worrying that years from now a future Attorney General will authorize a criminal investigation of them for behavior that a previous Attorney General concluded was authorized and legal.” Unhappy GOP lawmakers, plus one unhappy CIA director: “Administration officials [are] worrying about the direction of its newly-appoint intelligence team, current and former senior intelligence officials tell ABC News.com,” per ABC’s Matthew Cole, Richard Esposito, and Brian Ross. “Amid reports that Panetta had threatened to quit just seven months after taking over at the spy agency, other insiders tell ABCNews.com that senior White House staff members are already discussing a possible shake-up of top national security officials.”  And former Vice President Dick Cheney got the documents he wanted — though they don’t say quite what he promised. “The documents back up the Bush administration's claims that intelligence gleaned from captured terror suspects had thwarted terrorist attacks, but the visible portions of the heavily redacted reports do not indicate whether such information was obtained as a result of controversial interrogation techniques, such as waterboarding,” ABC’s Kirit Radia and Jason Ryan report.  Cheney statement: “President Obama’s decision to allow the Justice Department to investigate and possibly prosecute CIA personnel, and his decision to remove authority for interrogation from the CIA to the White House, serves as a reminder, if any were needed, of why so many Americans have doubts about this Administration’s ability to be responsible for our nation’s security.”  Cover from the left: “Obama has consistently opposed even a comprehensive investigation into human rights abuses and possible crimes committed by the Bush administration. His reluctance is understandable — but it's wrong,” Eugene Robinson writes in his Washington Post column.  What if this results in nothing? “Justice Department officials acknowledge that Durham's review may never result in any prosecutions. Indeed, virtually all of them were previously examined by a special Justice Department task force and rejected for prosecution due to a lack of witnesses and evidence,” Newsweek’s Michael Isikoff and Mark Hosenball report.  On another day, enough to dominate: “The Obama administration will continue the Bush administration’s practice of sending terrorism suspects to third countries for detention and interrogation, but pledges to closely monitor their treatment to ensure that they are not tortured,” The New York Times’ David Johnston reports.  All while the president watches his left flank: “After eight years, I am not convinced that pouring more and more troops into Afghanistan is a well thought out policy,” said Sen. Russ Feingold, D-Wis. “I think it is time we start discussing a flexible timetable so that people around the world can see when we are going to bring our troops out.”  ABC’s David Chalian: “That liberal base just got a high-profile voice to lead its charge. . . . The Wisconsin Democrat is starting to be a bit of a liberal thorn in the President's (left) side and has some Democrats wondering if he may be plotting a 2012 primary challenge to Mr. Obama.”  Preliminary election results out of Afghanistan Tuesday. The Washington Post’s Pamela Constable: “An Afghan cabinet minister said Monday that President Hamid Karzai won Thursday's presidential election with an overwhelming majority of 68 percent. If confirmed, such a result would eliminate the need for a runoff election in October between Karzai and his top challenger, Abdullah Abdullah, but could raise questions about the vote's credibility.”  At least health care isn’t in the headlines. . . . New narrative: “In the rhetorical battle over health care, the forces backing President Barack Obama's overhaul have spent years polling and using focus groups to find the precise language that would win over voters — an effort that doesn't at the moment appear to be working,” Jonathan Weisman writes in The Wall Street Journal.  John Rother, executive vice president for policy and strategy at AARP: “I don't want to second-guess them, but the research is very much a product of where the debate was at the time. Times have changed. Temperatures have gone up.” Arianna Huffington agrees: “Even if Obama were to summon his formidable grassroots army, as he attempted to do last week, exactly what is it they would be rallying around when knocking on doors or holding house parties? We've heard the mantra that the president wants ‘choice and competition.’ But how does he intend to do that? Specifically. He's been way too fuzzy — and foxy — on the fundamentals, with his administration delivering mixed messages from the very beginning,” she writes at Huffington Post.  From the annals of bipartisanship: “Sen. Charles Grassley signaled growing skepticism about the likelihood of Democrat-led health-care legislation passing this year, telling a town-hall meeting here Monday, ‘Now is the time to do this right or not do it,’ ” Douglas Belkin reports in The Wall Street Journal.  Former DNC Chairman Howard Dean joins Rep. Jim Moran, D-Va., at a health care town hall Tuesday evening — an event that conservative blogs have been hyping for days. Creating their own noise: “Faced with a souring public mood on health care reform, Democrats and their supporters are launching a national grassroots push Wednesday to show lawmakers that the majority of Americans still support overhauling the system,” Politico’s Chris Frates writes. “Reform supporters are planning to hold more than 500 events between Wednesday and when lawmakers return to Washington Sept. 8, ranging from neighborhood organized phone banks to professionally staffed rallies with hundreds of people.” What else House Financial Services Chairman Barney Frank, D-Mass., is up to: “As chairman of the House Financial Services Committee, Frank is busy assembling a complex bill to give the federal government unprecedented control over the country’s financial institutions,” The Boston Globe’s Sasha Issenberg reports. “It is as ambitious as any legislation jolting town halls and cable-news programs, and one that calls upon Frank’s lesser-known skills: discreet negotiation instead of the impatient insult showcased last Tuesday night in Dartmouth, when he belittled a woman who accused him of supporting a ‘Nazi policy’ on health care.”  Another Rudy comeback? “Nineteen months after ending his disastrous run for the presidency, Rudolph W. Giuliani is clearing a path for a possible race for governor in 2010, believing public anger at an ineffectual Albany and unease over the economy could create ideal conditions for a Republican to reclaim the governor’s mansion,” Danny Hakim writes in The New York Times. “Mr. Giuliani has told associates that he will decide on a candidacy within 30 to 60 days, as he weighs whether he can be elected statewide and what impact another campaign would have on his business interests.”  “We've spoken on and off this year about it and my impression was always that he was not intent on running, but after our [recent] breakfast … I would say he's definitely leaning toward it,” Rep. Pete King, R-N.Y., tells the New York Daily News’ Kenneth Lovett.
The Kicker: “I think that if Secret Service agents were there, they probably heard, like all of you already know, that they have great lobster rolls out there and they were probably just checking them out.” — White House Deputy Press Secretary Bill Burton, on a possible visit by the president to Sen. Ted Kennedy in Hyannis.  “I got a little booty shake.” — A thrilled Martha’s Vineyard resident, catching President Obama’s eye on the golf course. 
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