There are two Nelson Reports included in this post. One from yesterday and this from the latest Nelson Report:

SUMMARY: to supplement last night's Report on leading and likely "names" for Cabinet-level positions at State, DOD, Treasury, USTR, Intel and the White House, here are the transition-team group leaders, from an extensive press release, and the new ethics rules which will govern transition activity by lobbyists.

There has been some press comment about "where are the new faces, these are all Clintonistas", to which we'd suggest two things: first, except for the ancient Warren Christopher, very few Democratic government professionals have had ANY Dem president to work for except Bill Clinton, so what would you expect?

Second, informed sources make the point that some of the more prominent Hillary Clinton supporters who may be on these lists should be seen as evidence of Obama's gratitude for her, and their, support after the primaries.

On the ethics rules, noted next, campaign sources make clear that selection to the transition teams, in any capacity, does not constitute ANY kind of "understanding" about a job in the Obama Administration;

Further, team members are under explicit instruction that they are NOT to discuss potential employment with anyone.

Well...OK...point made and taken. Still, the lists are obviously useful and let's see how all this plays out as the new Administration takes shape.

On last night's Report, there were a lot of Loyal Reader emails asking what about this or that person for sub-cabinet postings, particular at the Under and A/S levels. As we tried to make clear, speculating to that level of detail at this point is not just misleading, but cruel.

A lot of really fine folks have had a minimum of 8 years to nurse frustrations and ambitions, with the result that there are far more highly qualified potential applicants for every job imaginable, than there are jobs.

So until we get reliable information on sub-cabinet people "in the basket" we will try to avoid the temptation to be clever at their potential expense.

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Nov. 11, 2008
Obama Transition Announces Rules for Lobbyists in Transition

Washington, DC: During a briefing today at the Presidential Transition Team headquarters, Obama Transition Co-Chair John Podesta announced the strictest, and most far reaching ethics rules of any transition team in history. The rules are:

· Federal Lobbyists cannot contribute financially to the transition.
· Federal lobbyists are prohibited from any lobbying during their work with the transition.
· If someone has lobbied in the last 12 months, they are prohibited from working in the fields of policy on which they lobbied.
· If someone becomes a lobbyist after working on the Transition, they are prohibited from lobbying the Administration for 12 months on matters on which they worked.
· A gift ban that is aggressive in reducing the influence of special interests.

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And the senior players:

November 12, 2008
Obama-Biden Transition Team Announces Agency Review Team Leads for Departments of Treasury, State and Defense

WASHINGTON - The Obama-Biden Transition Team today announced the Agency Review Team leads for the Department of Treasury, Department of State, and Department of Defense.

The Obama-Biden Transition Team also announced the Agency Review Team co-chairs, who will oversee the entire review process, as well as the Agency Review Working Group, which will manage and review the Teams' work and coordinate with other transition teams, including those handling personnel, policy and the budget.

The Agency Review Teams will complete a thorough review of key departments, agencies and commissions of the United States government, as well as the White House, to provide the President-elect, Vice President-elect, and key advisors with information needed to make strategic policy, budgetary, and personnel decisions prior to the inauguration. The Teams will begin their efforts by the end of the week, and will ensure that senior appointees have the information necessary to complete the confirmation process, lead their departments, and begin implementing signature policy initiatives immediately after they are sworn in.

Department of the Treasury Agency Review Team Leads

Josh Gotbaum currently serves as an advisor to investment funds, with a special focus on restructurings and management turnaround. He was startup CEO of The September 11th Fund, a charity that serves people, businesses and non-profits. From 1994-2001, Josh held Senate-confirmed positions in Treasury, Defense, and OMB. From 1981-94, he was an investment banker, working on mergers and restructuring in North America and Europe. His clients included major corporations, unions, and government. He also has worked in the White House and at the Department of Energy.

Michael Warren is the Chief Operating Officer of Stonebridge International LLC. He also is on the Board of Directors of the District of Columbia Retirement Board, Catalist, the DC Minority Business Enterprise Center Advisory Board, Southeastern University's Center for Entrepreneurship, Civitas, Riptopia, and the National Child Research Center. Mr. Warren previously worked at McKinsey & Company, both as a strategic consultant in the technology and financial institutions industries and as a fellow of the McKinsey Global Institute. Mr. Warren served within the White House as Executive Director of the President's National Economic Council.

Department of State Agency Review Team Leads

Tom Donilon is a partner at the law firm of O'Melveny & Myers and serves on the firm's global governing committee. Tom served as Assistant Secretary of State for Public Affairs and Chief of Staff at the U.S. Department of State during the Clinton Administration. Since leaving the Department he has remained deeply involved in the national security arena. He is a member of the Council on Foreign Relations, the Aspen Strategy Group, the National Security Advisory Group to the Congressional Leadership, the Brookings Institution Board of Trustees, the Miller Center of Public Affairs Governing Council, and the Trilateral Commission.

Wendy R. Sherman is a Principal of The Albright Group LLC and of Albright Capital Management LLC. Ambassador Sherman served as Counselor and chief troubleshooter for the State Department, as well as Special Advisor to President Clinton and Policy Coordinator on North Korea. Sherman is a recognized expert on national security issues and serves as a frequent analyst in major news outlets. She was recently appointed by Congressional Leadership to serve on the Commission on the Prevention of Weapons of Mass Destruction Proliferation and Terrorism.

Department of Defense Agency Review Team Leads

John P. White is Robert and Renee Belfer Lecturer and Chair of the Kennedy School Middle East Initiative. He served as U.S. Deputy Secretary of Defense from 1995 to 1997, Deputy Director of the Office of Management and Budget from 1978 to 1981, Assistant Secretary of Defense, Manpower, Reserve Affairs, and Logistics from 1977 to 1978, and as a lieutenant in the United States Marine Corps from 1959 to 1961. Prior to his most recent government service, White was the Director of the Center for Business and Government at Harvard University and the Chair of the Commission on Roles and Missions of the Armed Forces.

Michèle A. Flournoy is President and Co-Founder of the Center for a New American Security. Previously, she was a senior adviser at CSIS and a distinguished research professor at NDU. In the Clinton administration, she was dual-hatted as principal deputy assistant secretary of defense for strategy and threat reduction and deputy assistant secretary of defense for strategy. She is on the board of the Institute for Defense Analyses, and a member of the Council on Foreign Relations, the Aspen Strategy Group, the Executive Board of Women in International Security, and a former member of the Defense Policy Board.

Agency Review Co-Chairs

Melody Barnes is Co-chair of the Agency Review Working Group for the Obama-Biden Transition Project. She most recently served as the Senior Domestic Policy Advisor to the Obama for America campaign. Prior to joining the campaign, Ms. Barnes served as the Executive Vice President for Policy at the Center for American Progress, Chief Counsel to Senator Edward M. Kennedy on the Senate Judiciary Committee and a Principal at The Raben Group, LLC. Her experience also includes an appointment as Director of Legislative Affairs to the U. S. Equal Employment Opportunity Commission. Ms. Barnes began her career as an attorney with Shearman & Sterling.

Lisa Brown is Co-chair of the Agency Review Working Group for the Obama-Biden Transition Project. She is on leave from the American Constitution Society for Law and Policy where she is the Executive Director. Lisa served as Counsel to Vice President Gore, with a broad legal and policy portfolio that included serving on the Executive Board of the President's Committee for Employment of People with Disabilities. Before that, she worked in the Office of Legal Counsel at the Department of Justice, was a Partner at the D.C. law firm of Shea & Gardner (now Goodwin Procter), and clerked on the Eleventh Circuit Court of Appeals for the Honorable John C. Godbold.

Don Gips is on the Advisory Board of the Obama-Biden Transition Project and is Co-chair of the Agency Review Working Group. He is on leave from his role as Group Vice President of Global Corporate Development at Level 3 Communications, where he leads merger and acquisition efforts and is the Chief Strategy Officer. Prior to joining Level 3, Mr. Gips served in the White House as Chief Domestic Policy Advisor to Vice President Gore. Previously, Mr. Gips was Chief of the International Bureau at the Federal Communications Commission where he was responsible for the WTO negotiations and all spectrum policy. Mr. Gips also helped launch the Americorps Program at the Corporation for National Service. Before entering government, he was an Executive Manager at McKinsey & Company.

Working Group Members

Seth Harris is a member of the Obama-Biden Transition Project's Agency Review Working Group responsible for the labor, education, and transportation agencies. He is a Professor and the Director of Labor & Employment Law Programs at New York Law School. He is also a Senior Fellow of the Life Without Limits Project of the United Cerebral Palsy Association and a member of the National Advisory Commission on Workplace Flexibility. He served as the Chair of Obama for America's Labor, Employment, and Workplace Policy Committee and a Co-Chair of its Disability Policy Committee. During the Clinton Administration, he served as Counselor to the Secretary of Labor and Acting Assistant Secretary of Labor for Policy, among other policy-advising positions. Before joining the administration, he was a law clerk to Judge William Canby of the U.S. Court of Appeals for the Ninth Circuit and Judge Gene Carter of the U.S. District Court for the District of Maine.

David J. Hayes is a member of the Obama-Biden Transition Project's Agency Review Working Group responsible for the energy and natural resources agencies. He is former Global Chair of the Environment, Land and Resources Department at Latham & Watkins, an international law firm. He is a Senior Fellow at the World Wildlife Fund, advising the President of WWF on climate change matters, and he is a Senior Fellow at the Progressive Policy Institute, specializing on energy matters. Mr. Hayes is the Vice-Chairman of the national conservation group, American Rivers, and he is the former Chairman of the Board of the Environmental Law Institute. Mr. Hayes was the Deputy Secretary of the Interior during the Clinton Administration. During the 2007-2008 academic year, Hayes was a Consulting Professor at Stanford University's Woods Institute for the Environment.

Reed Hundt, is a member of the Obama-Biden Transition Project's Agency Review Working Group responsible for the international trade and economics agencies. He is a member of various boards of directors, a part-time senior adviser to McKinsey & Company, a strategic consulting firm, and an adviser to a number of firms. He served as the Chairman of the Federal Communications Commission from 1993 to 1997. Since that date, he has taught for a number of years at Yale College, Yale Law School, and the Yale School of Management, and Yale University Press has published two books written by him, You Say You Want A Revolution: A Story of Information Age Politics and In China's Shadow: The Crisis of American Entrepreneurship.

Sally Katzen is a member of the Obama-Biden Transition Project's Agency Review Working Group responsible for the Executive Office of the President and government operations agencies. She is a Lecturer at Michigan Law School and teaches American Government at the Michigan in Washington Program. She has also taught at George Mason, Pennsylvania and Georgetown law schools as well as at Smith College and Johns Hopkins University. From 1993-2001, she served as Administrator of the Office of Information and Regulatory Affairs in the Office of Management and Budget (OMB), then Deputy Director of the National Economic Council, and then OMB's Deputy Director for Management. She has served on National Academies of Science panels and is a Fellow of the National Academy of Public Administration. Before 1993, she was a partner at then Wilmer, Cutler & Pickering. She clerked for Judge J. Skelly Wright of the District of Columbia Circuit.

Tom Perez is as a member of the Obama Transition Project's Agency Review Working Group responsible for the justice, health and human services, veterans affairs, and housing and urban development agencies. He is Secretary of the Maryland Department of Labor, Licensing and Regulation under Governor Martin O'Malley. He worked in a variety of civil rights positions at the Department of Justice, including Deputy Assistant Attorney General for Civil Rights under Attorney General Janet Reno. He also served as Director of the Office for Civil Rights at the U.S. Department of Health and Human Services under Secretary Donna Shalala, and as Special Counsel to Senator Edward Kennedy. From 2001 until 2007, he was Assistant Professor of Law at the University of Maryland School of Law, and is an adjunct faculty member at the George Washington School of Public Health.

Sarah Sewall is a member of the Obama-Biden Transition Project's Agency Review Working Group responsible for the national security agencies. She is on part-time leave from the Harvard Kennedy School of Government, where she teaches and is Faculty Director of the Carr Center for Human Rights Policy. Her research focuses on U.S. national security strategy, civil-military relations, counterinsurgency, terrorism and mass atrocity. Sewall served as the first U.S. Deputy Assistant Secretary of Defense for Peacekeeping and Humanitarian Assistance (1993-1996). She previously served for six years as Senior Foreign Policy Advisor to Senate Majority Leader George Mitchell.

Louisa Terrell is a Working Group member of the Obama-Biden Transition Project's Agency Review Team. Louisa is on leave from her role as Senior Director at Yahoo!'s public policy office in Washington, D.C. Prior to joining Yahoo! Louisa was Deputy Chief of Staff for Senator Joseph R. Biden, Jr. Previously, Louisa was counsel for Senator Biden on his Senate Judiciary Committee staff where she handled criminal sentencing, juvenile justice, child protection, immigration policy and women's issues, among other areas and before that worked in the Civil Rights Division of the Massachusetts Attorney General's Office.

Ray Rivera is a member of the Obama-Biden Transition Project's Agency Review Working Group. He was most recently State Director for the Obama-Biden Campaign in Colorado. He was also the State Director for the Colorado Caucus and served as Northeast Field Desk out of Chicago headquarters early in the campaign. Prior to the Obama Campaign, Ray was a Political Director for AFSCME, public employee's labor union and a union organizer. Ray was born in Albuquerque, NM and graduated with a BA from the University of New Mexico in 2001.

Michael Warren is a member of the Obama-Biden Transition Project's Agency Review Working Group helping to oversee the international trade and economics agencies. He is on partial leave from his role as Chief Operating Officer of Stonebridge International LLC., where he is a member of the firm's Management Committee. Prior to joining Stonebridge, Warren led corporate development at Horne Engineering Services and served as President of Appfluent Technologies. He also serves as Chairman of Ironbridge Systems. He is on the Board of Directors of the District of Columbia Retirement Board, Catalist, the DC Minority Business Enterprise Center Advisory Board, Southeastern University's Center for Entrepreneurship, Civitas, and the National Child Research Center. Warren previously worked at McKinsey & Company, both as a strategic consultant in the technology and financial institutions industries and as a fellow of the McKinsey Global Institute, advising corporate leaders in the U.S. and Asian semiconductor industries. He served within the White House as Executive Director of the President's National Economic Council.

Tom Wheeler is a member of the Obama-Biden Transition Project's Agency Review Working Group responsible for the science, technology, space and arts agencies. He has taken a leave of absence from Core Capital Partners, a venture capital firm working with early stage technology companies, where he is a Managing Director. For three decades, Wheeler has worked at the forefront of technology, both as an entrepreneur and as a policy specialist. He has been the CEO of the National Cable Television Association and the Cellular Telecommunications & Internet Association, as well as the founder or co-founder of multiple new technology companies. Wheeler is the author of two books: Mr. Lincoln's T-Mails and Leadership Lessons from the Civil War.

Jon Wilkins is a member of the Obama-Biden Transition Project's Agency Review Working Group. He has taken a partial leave of absence from McKinsey & Company, where he is a partner in the Washington, DC office. Jon first joined McKinsey in 1996. He then worked at the Federal Communications Commission from 1998-1999 before re-joining McKinsey in 1999. He was Managing Editor of the Yale Law Journal.

And here is the day before:

SUMMARY: anyone who tells you they have the final list of who will get the big jobs is lying to you. But it IS possible to put together a useful basket of names for each Cabinet and major function.

Tonight's Report is our best effort at the Asia/foreign policy/trade focus situation as of this week, bearing in mind the obvious...the final choice will be a combination of factors, including whether "the choice" wants the job being offered.

For example, we don't believe that New Mexico Gov. Bill Richardson is on the short-list for State, despite all the pressure from Hispanic political sources, not to mention his desires. But Richardson does appear to be a leading pick for Interior, an increasingly vital position in today's global climate crisis-management world.

Richardson's presidential effort featured a detailed, imaginative approach to energy/climate change. Will he accept Interior, if offered? Hummm...OK, how about the UN? Maybe Ambassador to China?

About State...it looks like the current "basket", in rough order of rank, includes Sen. John Kerry and Sen. Chuck Hagel, but NOT Richard Holbrooke. Also, don't forget former Sen. Tom Daschle.

But here's our clever pick for State, if you are placing bets: Al Gore.

You can see right away how the State list can be in flux right up to the last second. Ditto for Treasury, USTR, and other postings of concern to us Asia/trade types.

DOD? Consensus remains firm that Obama wants Secretary Gates to stay on well into next year, if not also through completion of the pivot from Iraq to Afghanistan/Pakistan.

Rumors that Gates himself may be thinking about gracefully declining are not accurate, meaning Obama will likely install Richard Danzig as the Deputy (and Secretary in training).

The text of tonight's Report will list our selections for each "basket". If you have your own list, or you think you should be listed (!) send us an email.

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GREEN...our Monday Report (there was no Report yesterday, Veterans' Day) noted the White House announcement of the President's desire to nominate former NSC Senior Director for Asia, Dr. Mike Green, as ambassador in charge of trying to work with Japan and ASEAN on a solution to the Burma problem.

Loyal Reader feedback was vigorous...not on Mike himself, but about the realism of timing, and whether a "midnight" announcement of any kind like this should be taken seriously.

Further information: yes, it should be taken seriously in that it HAD been planned to submit the nomination well before the election, but paperwork from State was delayed.

Reasons for that are not explicit, but do seem to involve both substance and process. Bottom line remains the same...the papers didn't get up until after the election.

On the Senate confirmation side, there was extensive consultation with both Democratic and Republican staff, and, we are told, it is still hoped that a hearing on Green can be scheduled in time for action this year.

Should that occur, a Floor vote would be the final hurdle, but there the process may meet an unsurmountable obstacle. We are told...or, rather, reminded...all it takes is one senator to put a "hold" on a nomination, and given the short time-line of the Lame Duck session, that would be "it" for the Burma policy posting.

Recall, for example, how long it took to get Amb. Kathy Stephens cleared for a confirmation vote, due not to Stephens herself, but to the objections of Sen. Sam Brownback to Bush Administration policy on N. Korea.

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N. KOREA...and on that, Pyongyang today sliced another piece off the blackmail salami, declaring that any deviation from A/S Chris Hill's verification document by the Obama Administration would be "an act of war".

The rhetorical "blast" further dimmed hopes of a 6 Party deal this year by claiming the protocols accepted by the Bush Administration don't allow soil tests and other verification procedures away from the Yongbyon nuclear complex itself.

All well timed for a useful, if sobering look at the tasks facing the Obama Administration at the Council on Foreign Relations here today, moderated by Don Oberdorfer, with the above mentioned Dr. Green, and the Council's non-proliferation guru, Gary Samore, discussants.

First thing, or most critical thing...three things, actually:

First, set up and implement a Special Coordinator for North Korea who will run a full inter-agency team process, including State, DOD, CIA, NSC..no way should yet another A/S EAP get tar-babied with the Korea portfolio;

Second, before finalizing the "Obama program" for the DPRK, fully consult...REALLY consult...with Japan, S. Korea and China, recognizing that communication of late, especially with Japan, has not been happy;

The consultation process must involve "really listening", especially to Japan, which feels the US has broken its word on abductees and de-listing on terrorism, in addition to failing to produce a serious verification mechanism.

Third, once the US has a coherent policy implementation process in place, and has developed a coherent policy based on real consultations, it will be vital to re-focus the DPRK's mind on "consequences" if it continues to cheat, a la Syria...and this should involve a re-focus on UN Security Council Resolution 1718.

Samore and Green agreed that while the Bush decision to keep the 6PT going by caving-in to the DPRK on a strict verification protocol may be understandable, it makes Obama's task all the more difficult, since now, US allies Japan, S. Korea and China have reason to doubt US "seriousness"
about pursuing full de-nuclearization of the Korean Peninsula.

And in turn, that undermines the vital US strategic interest in not just putting a "cap" on plutonium production at Yongbyon (should the current arrangement remain in place) but even more critically, convincing the DPRK that further proliferation of nuclear technology (or fissile material) really IS a "red line" which will be enforced.

In that regard, Green and Samore agreed that the Israeli destruction of the DPRK nuclear facility in Syria was critical, because not only did it apparently remove the immediate risk, it "sent a signal" to potential DPRK customers that they would be playing a dangerous, potentially fatal, and certainly very expensive game.

In answer to our question, Green warned that the Obama folks dare not try to re-focus negotiations with N. Korea on the proliferation question, per se, because that falls into the trap of N. Korea saying it will only accept restrictions IF the US accepts N. Korea as a declared nuclear state...Samore strongly agreed this is unacceptable.

Also, the two agreed, the Obama Administration needs to resume the old Clinton Administration focus on missiles, especially now that the DPRK is clearly working on "weaponization" of its nuclear warhead.

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NAMES...OK, we gave you State in the summary, but to discuss it a bit:

State: we think Nobel Prize winner Al Gore is increasingly getting a serious look by the Obama folks. But if that doesn't work out, Sen. John Kerry may lead the list, and he may get the offer...god knows he wants the job.

If Kerry doesn't get it, he likely moves up to Chairman of Senate Foreign Relations, replacing VP Biden. If he does get State, then the very liberal Sen. Russ Feingold takes over SFR. Does the Obama Administration want that, great guy though Feingold is?

Sen. Chuck Hagel? (See "Intel", below.)

Dick Holbrooke has been fighting for his life ever since Hillary Clinton's campaign went down in flames, but our information consistently maintains he went with her. Operative quote from a very very senior member of Obama's inner circle says he would personally throw his body into the path of a Holbrooke nomination.

So never say never, but. Actually, if Obama asks us? Holbrooke for Special Envoy to the Middle East. Turn him loose, back him to the hilt, and don't let him come home until there's a real deal.

Also at state, Undersec/Political look for Amb. Jeff Bader, now at Brookings, with Biden Asia policy staffer Frank Jannuzi as A/S EAP...those two should be at the top of anyone's short list.

Bader ran the Asia Advisors for the Campaign, and his long career includes being AUSTR for China, and Amb. to Namibia. Jannuzi, who ran the Korea Advisors under Bader, is also a strong candidate for NSC Senior Director Asia, if Biden does not keep him on the OVP staff.

Defense: barring a genuine earthquake in discussions and objectives, Bob Gates will remain, with the inducement that this time, he gets to really pick his own team and get it properly cleared.

Remember, when he came in for Rumsfeld, all he had time to do was to fire the egregious Doug Feith, and his ilk. (So put Richard Danzig as the most likely Secretary-in-training as Deputy.)

Treasury: no surprises here, Larry Summers probably edges out Tim Geithner, of the NY Fed, but keep N.J. Gov. John Corzine high on the list, just in case. (Do NOT believe rumors of a "return engagement" by Bob Rubin.)

At a very senior level, perhaps an Undersecretary, the Asia basket must include China/Japan hand Matt Goodman, now active on the Transition for Treasury.

USTR: picking the order is difficult, but the main "basket" can start with Laura Tyson, Clinton chief of staff Mac McLarty, former Rep. "Cal" Dooley, and Obama campaign senior advisor Dan Tarullo, of John Podesta's Center for American Progress. Probably also include Dallas Fed president Richard Fisher, Clinton's Deputy USTR for Asia, who almost got the job under Bush, instead of Bob Zoellick.

Also a leading contender for the top spot put campaign advisor Lael Brainard, who held several senior staff positions at Clinton's State and National Economic Council.

INTEL: who knows how the "mix" between CIA, NIC etc., plays out, but put in the most important basket Rich Armitage, retired Gen. Jim Jones, and Rep. Jane Harmon. Campaign advisor Greg Craig also is in the senior Intel and NSC mix.

Where's Sen. Hagel in all this? If Gates stays at Defense, which he will, does Obama give another Republican a glamour Cabinet post like State? Nope...but CIA? DNI? Hagel would be a good choice at the top of the Intel totem pole. Plus, Obama likes and trust him.

NSC: Jim Steinberg, Clinton's Deputy National Security Advisor, is at the top of this basket, but it must include Craig, with senior campaign advisor Susan Rice as a very strong candidate for Deputy, if not for the UN ambassadorship.

Amb. to Japan: there is a movement within the Campaign to recommend former Rep. Norm Mineta, despite his years of service to Bush as Secretary of Transportation. Mineta would meet most if not all of Japan's traditional criteria.

Clever bet? Put Rich Armitage on the Tokyo list. Japan has been in a swivet for months at the prospect that the Democrats, who "have no Rich Armitage", are somehow unknown and less "reliable" than Republicans. OK....

UN Ambassador: as noted, Susan Rice, and if not, Caroline Kennedy.