Former OMB Chief Discusses Deficit, Economy at DMA Luncheon

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ORLANDO, FL -- Like the Direct Marketing Association, the keynote speaker yesterday at the DMA Hall of Fame luncheon knows a lot about taking public criticism. Until he resigned June 6, Mitch Daniels was director of the Office of Management & Budget under President George W. Bush.


Bush even acknowledged the tough time Daniels had in his tenure at the White House. His present to Daniels was a lapel pin that recognized 10 years of service.


"Because you and I have been through 10 years of work in 2 1/2," the president told Daniels.


The current president is "quick and clever," unlike Ronald Reagan, "who was a great storyteller," Daniels said. Most of Bush's personality is evident to the public, though he has a sense of humor that is not as known.


For example, it was apparent that the fighter pilot flying Bush to the USS Abraham Lincoln aircraft carrier in the spring was on edge.


"Lieutenant, are you nervous?" the president asked the pilot.


"Yes, sir," the pilot replied.


"Relax, lieutenant," the president said. "The nation's got a great vice president."


That pilot had just one occasion to be tense. For Daniels, it was every day of his tenure at the White House. He took direct flak for the country's quick descent into a financial deficit from a projected half-trillion-dollar surplus.


Daniels blamed the creeping recession when Bush took over as well as corporate malfeasance, the attacks of Sept. 11 and the aftermath, tighter homeland security and the war on terror on foreign soil for the nation's spiraling deficit.


The deficit could have been lower had the president not taken homeland security steps after the terrorist attacks or had not fought terror on foreign soil, Daniels said.


"It could have been worse had it not been for [a stable] housing market and for low interest rates," he said.


"The real threat is the unfunded liabilities of our social programs," he said, adding that they could amount to five to 10 times that of the national deficit.


In his most visible connection to the direct marketing business, Daniels was involved in the discovery that the U.S. Postal Service had almost fully funded obligations to the Civil Service Retirement System -- a finding that saved the postal service billions of dollars.


"You should have seen the look on [postmaster general] John Potter's face when I told him," Daniels said.


He told attendees not to oppose restrictions on telemarketing.


"I would not waste any time resisting the no-call list as some form of government regulation," he said. "Fifty million people signing for the no-call list -- that's a groundswell."


An audience member asked whether the no-call list should apply to political calls, which are exempt along with those from charities, researchers, business-to-business and companies contacting existing customers.


"I think politicians should" respect the no-call list, Daniels said, admitting that he yet had to ponder whether "our civic life is different from our commercial life."


Daniels was a senior executive at pharmaceutical giant Eli Lilly before his White House stint, and before that an aide to then-Indianapolis mayor and now U.S. Sen. Richard Lugar. He is now running for governor of his home state, Indiana.


Still, he told marketers to "keep the clammy, dead hand of government off your face."


Daniels particularly likes Defense Secretary Donald Rumsfeld's rules, including: "If you're not being criticized, then you're clearly not getting much work done."


He was also wistful about his interactions with members of Congress.


"Where else do you see a congressional committee on the hazards of obesity chaired by Ted Kennedy?" he said.


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