Haass and Bloomberg: Nightmare on Pennsylvania Avenue

In this week's NEWSWEEK, two of America's smartest policy wonks--Council on Foreign Relations President Richard Haass and New York Mayor Michael Bloomberg--send unsolicited letters to the next president of the United States. Haass warns of the international challenges ahead; Bloomberg tackles the economy. Below are key excerpts. But be sure to read the whole "President's Inbox" package; it's a important reminder that winning the election will be the easy part. The comments, as always, are all yours.

HAASS:

There are only two and a half months—76 days, to be precise— between Election Day and your Inauguration, and you will need every one of them to get ready for the world you will inherit. This is not the world you've been discussing on the trail for the last year or more: campaigning and governing could hardly be more different. The former is necessarily done in bold strokes and, to be honest, often approaches caricature. All candidates resist specifying priorities or trade-offs lest they forfeit precious support. You won, but at a price, as some of the things you said were better left unsaid. Even more important, the campaign did not prepare the public for the hard times to come.

There will be days when you will wonder why you worked so hard to get this job. What will make it so difficult is not just all that awaits, but the constraints that will limit what you can actually do. When George W. Bush became president nearly eight years ago the world was largely at peace, the U.S. military was largely at rest, oil was $23 a barrel, the economy was growing at more than 3 percent, $1 was worth 116 yen, the national debt was just under $6 trillion and the federal government was running a sizable budgetary surplus. The September 11 attacks, for all they cost us as a nation, increased the world's willingness to cooperate with us. You, by contrast, will inherit wars in Iraq and Afghanistan, tired and stretched armed forces, a global struggle with terrorism, oil that has ranged as high as $150 a barrel, a weaker dollar (now worth 95 yen), substantial anti-American sentiment, a federal budget deficit that could reach $1 trillion in your first year, a ballooning national debt of some $10 trillion and a global economic slowdown that will increase instability in numerous countries.

You will take office two decades after the end of the cold war. What some dubbed the unipolar moment is history. Economic, political and military power is held by many hands, not all of which belong to states, not all of which are benign. This does not mean the United States is weak. To the contrary, this country is still the single most powerful entity in the world. But the United States cannot dominate, much less dictate, and expect that others will follow. There are limits to U.S. resources; at the same time the country has serious vulnerabilities. Enron, Abu Ghraib, Katrina and the financial crisis have taken their toll: America's ability to tell others what to do, or to persuade them through example, is much diminished.

Against this backdrop, you will face specific challenges. Many are to be found in the greater Middle East, the part of the world where every president beginning with Jimmy Carter has stubbed his toe. Consider Iraq, the issue that most dominated the foreign policy of Bush. There will be ample time for historians to sort out the wisdom (or lack thereof) of embarking on this costly war of choice. The priorities now are to gradually reduce U.S. force presence, back the integration of Iraq's Sunni minority into national institutions, persuade Arab states to help the government and resume a dialogue with Iran on Iraq's future. The good news is that many of the arrows in Iraq are finally pointing in the right direction and it will not dominate your presidency. The bad news is that you know you are in for a rough ride when Iraq is the good news.

BLOOMBERG:

The stock market has plummeted. The credit markets are frozen. Unemployment is rising. Housing foreclosures are skyrocketing. Consumer spending is weakening. Manufacturers are cutting production. A global recession is in the offing. Welcome to the White House, 44. You're sure you wanted the job, right?

The global financial crisis has prompted countless comparisons to the Great Depression, and no doubt members of the media will soon be asking you to detail your agenda for your first 100 days, expecting you to pursue a legislative sprint as fast as Franklin D. Roosevelt's in 1933. My advice: ignore them. Your first 100 days in Washington will be better spent preparing for the 1,360 days that will follow.

FDR's first 100 days achieved what the Bush administration and Congress have been trying to do for the past 60 days: restoring confidence in our financial institutions. By the time you take the oath of office, the worst of the bank panics should be behind us. And while the economy may well be in a full-fledged recession, leading the country out of it, and laying the foundation for a new century of growth and prosperity, can't be done in a few short months—and it can't be done with regulatory reform alone.

Reforming the structures that govern financial institutions will likely be the hot topic of the next Congress, and that's long overdue. But it is critical that you not allow Congress to confuse regulatory reform with an economic agenda. The long-term health and strength of the nation's economy depends less on the shape of federal regulations than on the country's capacity for growth and innovation.

Over the past decade, as you well know, our status as the world's economic superpower has been challenged as never before. Thanks largely to America, capitalism has triumphed around the globe, and now everyone wants to beat us at our own game.

This is a competition we should relish, because we continue to enjoy all sorts of advantages: the best universities, the most advanced factories and health care, the most entrepreneurial workers and the best quality of life. But like a champion who has gotten complacent and sloughed off on workouts, the federal government—paralyzed by partisan gridlock and special-interest pandering—has let America slip out of top fighting form. Getting back into shape will not be easy or pain-free, but the alternative—losing ground to China, India, Korea, Japan, the European Union and others—is simply not an option.