Obama's Agency-Consolidation Scheme: Good Politics, but What About Policy?

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The president seems to have outmaneuvered Republicans once again. But it's unclear how much good they'll do.

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Barack Obama on Friday asked for the authority, held by presidents between the Franklin Roosevelt and Ronald Reagan, to re-organize agencies of the executive branch.

Specifically, he wants to combine Commerce Department's trade and finance functions with the Small Business Administration; the Office of the U.S. Trade Representative; the Export-Import Bank; the Overseas Private Investment Corporation; and the Trade and Development Agency. In other words, he wants to create one major agency that deals with promoting American business.

It's great politics for several reasons.

  1. Everyone believes that government agencies are a confused mess because it happens to be true.
  2. Obama gets to talk like a business leader. He wants to cut through bureaucracy and rest-tape, and make government more consumer-friendly.
  3. It undercuts his image as a big-government liberal and blocks Romney (or any Republican) from getting a perfect campaign contrast. Obama can simply say, "I've asked Republicans to give me the authority to slim down government and make it more efficient." A Republican presidential candidate would have a hard time arguing against a plan like this. At the same time, Republicans don't want to give Obama easy victories either.

Of course, there may be many reasons why this could turn out to be bad policy. The Export-Import bank guarantees loans to foreign buyers of American goods like Boeing's airplanes. Why should it be combined with parts of the Small Business Administration. Doesn't this set up a situation where small businesses are competing for the same government resources as giant exporters like Boeing?

This article originally appeared at Business Insider, an Atlantic partner site.

Image: Kevin Lamarque / Reuters

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Michael Brendan Dougherty is politics editor at Business Insider.

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