Mr. Co-President? Obama upstages Bush on economy

CHICAGO (Reuters) - There may be only one U.S. president at a time, but you wouldn't know it by watching Barack Obama this week.

The Democratic president-elect, who kept a low profile for three weeks after his White House win, has swung into action with a series of economic pronouncements and cabinet selections that have overshadowed President George W. Bush.

If financial markets are clamoring for more leadership, Obama got the message.

"There is a leadership vacuum. If Obama doesn't fill it, more panic will result in (the) short run, and the problem will become greater by the time he officially takes office," said Stephen Wayne, professor of government at Georgetown University.

"It is still Bush's power to act now, but Obama's obligation to tell jittery Americans what he plans to do."

On Monday Obama held a news conference to announce his economic team. Flanked by flags and new staff members, he vowed to jolt the economy with an aggressive new stimulus package.

On Tuesday Obama held another press event, this time announcing his pick to run the White House budget office and intention to cut billions of dollars in wasteful spending.

Both days he took questions from reporters while his heavyweight appointments -- including New York Federal Reserve Chairman President Timothy Geithner as Treasury secretary -- stood behind him, silent. He has another news conference scheduled for Wednesday.

Meanwhile, back in Washington, Bush had coffee with his Treasury secretary, told reporters he was keeping his successor apprised of steps to secure the financial system, and took a trip to visit troops in Kentucky.

On the pressing issue of the day -- the economy -- the man who will be the next president of the United States very much upstaged the current White House occupant, prompting a question on Tuesday about his oft-stated pronouncement that the country only had one head of state at a time.

"Well, there is only one president at a time. That president is George W. Bush, and he will be president until I'm sworn in on January 20th," Obama said, when asked how he squared his involvement in the economy with that fact.

"(But) I think it is very important for the American people to understand that we are putting together a first-class team and for them to have clarity that we don't intend to stumble into the next administration."

LEADERSHIP VACUUM

No stumbling so far. Obama has drawn accolades for his appointments, though his refusal to give his stimulus package a price tag caused U.S. stocks to pare gains briefly on Monday.

Paul Beck, a professor of political science at Ohio State University, said the current transition recalled the situation in 1932 when Democrat Franklin Delano Roosevelt took over from Republican Herbert Hoover in the midst of an economic disaster.

"It is not normal that a president-elect would get involved in this way, but these are not normal times," he said, adding that Bush's credibility had eroded to the point that he was not taken seriously within the financial markets.

"The economy will not wait for the transition to be completed. That was a problem in 1932, and subsequently we moved the presidential inauguration from March to January. Now, we are finding out that January is not early enough."

Obama takes over from Bush on January 20. He has urged the next U.S. Congress to move quickly on his proposed stimulus and assured Americans he will be in control from the start.

"We are going to hit the ground running," he said on Tuesday. "We're going to have clear plans of action."

Larry Sabato, professor of politics at the University of Virginia, said he believed the actions by Obama and Bush had been orchestrated by both sides.

"President Bush is not blind, and he knows his popularity is extremely low," Sabato said.

"This is a full blown crisis, and neither president wants a complete meltdown. Therefore, the president with credibility, Barack Obama, is taking the lead with the quiet acquiescence of the Bush administration."

(Editing by Cynthia Osterman)