Why OMB is not quite the White House (and why we might care)

Oct 4 '11

Today’s New York Timesstory about Solyndra centers on presidential staffing: on the disputes between Office of Management and Budget (OMB) staff and others in the Obama administration over the loan guarantee program and whether the company was a good credit risk, an argument that was still in full force at the time the President made his now-infamous visit to Fremont. A report produced by the minority staff on the House Energy and Commerce Committee (available here – by the way, does it bother anyone else that committee websites now barely pretend there is more than one party represented on each committee?) quotes an email from an OMB staffer saying “hope [the company] doesn’t default before then…”

Few people in the universe care about the details of presidential staffing — and they did not write this story. Most notably, I found it interesting that OMB is referred to as a staff “inside the White House” and again as “part of the White House.”  This is surely for good journalistic reasons – an intra-White House dispute is bigger news and more fun. But let me be pedantic for a moment, I promise for a purpose.  The basic point: OMB is not in the White House.

Now, this is true physically, but that in itself doesn’t matter much. Lots of “White House” staffers have their offices outside the West Wing, usually in the ornate Eisenhower building next door (which, ironically, Eisenhower wanted to tear down) or up the street a bit (much of OMB is in the “new” executive office building on 17th Street NW).

It is also true organizationally. The White House Office (WHO) and the OMB are both separate units within the larger presidential staff holding company called the Executive Office of the President.  But this, too, might simply be a matter of administrative convenience.

Most crucially, then, it is true historically and culturally. OMB and the personal White House staff are different: one serves the president of the time – indeed, the institution of the presidency — and the other a specific incumbent’s personal and political needs. This has been the case since Franklin Roosevelt created the EOP in 1939, created a separate White House staff and made OMB (then known as the Bureau of the Budget) the bulwark of the institutional presidency. OMB’s ethos is meant to be one of “neutral competence”: its staff are mainly careerists, not political appointees. Its job, when it does it well, is to give the president the factual basis for decision-making – some idea of the expected utility of a given policy choice.

Some argue that over time, the distinctions between OMB and the White House staff have eroded, through the politicization of OMB or through the elevation of budget issues (OMB’s main responsibility) to partisan prominence. Nixon is often credited/blamed.  There is important truth to this, though the story is (naturally) more complicated: for a much longer version of part of the timeline, see here.

But the separate ethos remains, even if frayed around the edges. In fact, today’s story, and the House report more generally, show OMB doing its job – and the White House staff doing their job too. OMB analyzed the industry, raised technical issues, kept the Department of Energy from its worst impulses, and suggested to the White House some potential political landmines. The White House staff, including Larry Summers, Valerie Jarrett, Carol Browner and Ron Klain, took that information, did some additional legwork, and decided the rewards of the program (and the visit) outweighed the risks.

The point isn’t that they were wrong this time around. It is that the separation of OMB and WHO makes it more likely that they will be right more often, over time. Thus that separation is something worth preserving, even when it embarrasses the president in the short run.