Obama's planning for a second term has been under way for months. Obama's second-term Cabinet

President Barack Obama plans an extensive shuffle of his West Wing and Cabinet, with White House chief of staff Jack Lew most likely headed to Treasury and former Sen. Chuck Hagel, a moderate Republican, under consideration for secretary of defense, administration insiders said.

Planning for a second term has been under way for months, with Lew and Pete Rouse, the counselor to the president and Obama’s internal management guru, preparing lists of possible promotions and nominations. The staff process has been gossiped about by the staff, but details have been kept secret, even from insiders.


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“They haven’t even made calls. People haven’t been asked,” said a Democrat familiar with the situation. “They’re more targets than they are potential nominees.”

Now, officials will start to cement their departure dates, and aides will sound out colleagues about possible new roles. Among the top current officials expected to go: Treasury Secretary Timothy Geithner, Secretary of State Hillary Clinton, Defense Secretary Leon Panetta, Energy Secretary Steven Chu, Interior Secretary Ken Salazar and Lisa Jackson, administrator of the Environmental Protection Agency.

Attorney General Eric Holder and Transportation Secretary Ray LaHood might not be far behind — or may even beat them out the door.

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There’s also a growing list of people the administration is looking to find spots for: Massachusetts Gov. Deval Patrick most of all, as well as former Michigan Gov. Jennifer Granholm and outgoing North Dakota Sen. Kent Conrad.

Obama has overseen one of the most stable cabinets in history — the only departures have been Defense Secretary Robert Gates, and Gary Locke and John Bryson from Commerce. But what’s about to happen amounts to an almost full-scale second transition:

Treasury

If not for the upcoming fiscal cliff negotiations, Geithner might have been ready to hand Obama his resignation letter as the president walked off stage at the McCormick Place Tuesday night. But once the negotiations are done — or done enough — he’s still expected to be the first to go.

The post is going to be crucial for Obama’s second-term challenges — job growth, a massive restructuring of the budget and, of course, the teetering of the eurozone. There’s a comfort that Obama feels with Geithner, a security just from having the treasury secretary swing through the Oval Office. That’s going to be hard to replicate, and a big part of why discussions are focused increasingly around one person: Lew.

“Increasingly in the last week, it’s his name and only his name,” said one Democratic insider who’s in touch with the Obama circle. “They like Jack, they can get Jack. Jack can do the job. I’d be shocked if it were anyone other than Jack.”

There’s some chatter about Erskine Bowles, but he’s not trusted by the inner circle and hasn’t helped his cause since the end of the Bowles-Simpson Commission. Roger Altman, who was a deputy at Treasury under Clinton, is also seen as a possibility.

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Much of Rouse’s attention has been focused on trying to find a Fortune 500 CEO to recruit, such as Larry Fink of BlackRock, Tony James of the Blackstone Group and David Cote of Honeywell or even Eric Schmidt of Google. Facebook Chief Operating Officer Sheryl Sandberg’s name comes up — Obama clearly likes her, and she served as chief of staff at the department under Larry Summers. She would also be the first woman to run Treasury after an election in which middle-class women provided a crucial margin for the president. But despite the recent uptick in the stock price, her company still has a lot of work ahead.

Commerce

There’s also the possibility that one of them lands at commerce, which has been run by an acting secretary since Bryson resigned, but Wall Street tends to see that as a second-string prize that might not be enough to lure titans from their big compensation packages. Other possibilities here include U.S. Trade Representative Ron Kirk and Export-Import Bank President Fred Hochberg, who would be the first openly gay Cabinet secretary.

State

Given the celebrity of Clinton and the two top contenders to replace her, there’s little question that this could quickly become the most interesting Cabinet battle. In one corner, there’s Susan Rice, the U.N. ambassador with strong connections to Obama and other senior staffers. In the other, there’s John Kerry, the Senate Foreign Relations Committee chairman who picked Obama to give his career-making 2004 keynote address, endorsed him early in the 2008 primaries and worked with the White House throughout Obama’s first term. Whatever Clinton is thinking about for 2016, she’s expected to be gone before much of 2013 has passed — though she may extend her initial time frame to see the Benghazi fallout through.

This one’s heavy with political ironies. If Obama picks Rice, Republicans would hammer her with Benghazi questions. Her prospects were damaged because she was a team player, going on the Sunday shows to carry the administration’s initial message that the riot over an anti-Muhammad video seemed to be responsible, in part, for Ambassador Chris Stevens’s death. If Obama picks Kerry, he’d open up a Senate seat, in a state where Republican Sen. Scott Brown is now looking for a job. The Massachusetts Legislature changed the appointment law in 2004 to stop then-Gov. Mitt Romney from appointing then-presumed President-elect Kerry’s replacement, and it was under that special election provision that Brown won in the first place. Patrick, the governor, would be a Democratic candidate for that race, but he’s also a potential Cabinet member.

Patrick waited about an hour after the election was called for Obama to talk up Kerry’s prospects, which were helped by the Democratic gains in the Senate that made the majority more secure. But opinions are torn about how this decision will fall.

“They think it’s going to be Susan Rice,” said one Democratic insider in touch with the Obama circle. “If Obama wants to make her secretary, he’ll get her in.”

“Kerry was a very close second the first time around. He wanted it; he had several interviews. There was an assumption that he would get it if Hillary said no,” said another Democrat familiar with the circumstances. “Now that Hillary’s no longer a question and he still wants it, and because he’s been such a great team player and worked so hard in the debate prep, I think he has the inside track.”

Then there’s the dark horse: National Security Adviser Tom Donilon, who’s always wanted the job but wouldn’t have the same weight of personality that Rice or Kerry would bring. He has Obama’s trust — though that’s exactly the argument for having him take over for Lew as chief of staff.

NSA

Wherever Donilon goes, if he does, the smart money’s on his deputy, Denis McDonough, to move up — or on former Defense Undersecretary Michèle Flournoy, who’s known to want to come back. Tony Blinken, Vice President Joe Biden’s national security adviser, is also a possibility to move over.

Chief of Staff

Donilon could have some competition for chief of staff, including former Biden chief of staff Ron Klain, who hit it off with Obama during debate prep and other campaign strategy meetings. Klain could be headed to a senior adviser position, though. Tom Nides, a current deputy secretary of state, is also a possibility for chief of staff. Former Senate Majority Leader Tom Daschle’s name has come up a few times recently — he knows the Hill, and this job wouldn’t require Senate confirmation — but the time he’s spent out of the game might be a reason for both him and the president to consider other options.

Defense

Panetta is expected to stay only as long as he’s needed to oversee the first round of post-fiscal cliff budget cuts before deciding he’s had enough weekend-only trips to his California home.

That might point to Ash Carter, Panetta’s deputy. As a physicist, he’s seen as a guy with the right mind-set for restructuring and rethinking a slimmer military. Flournoy is interested in the job, which could let Obama appoint the first female head of the Pentagon. And Richard Danzig, Clinton’s former secretary of the Navy and a 2008 Obama adviser, would allow Obama to have someone from his circle in charge of an agency that’s often been the source of presidential heartburn.

But as Obama continues to wind down the wars, a veteran might have some appeal. Outsiders’ fantasy bingo sometimes lands on CIA Director David Petraeus or outgoing Virginia Sen. Jim Webb, though few believe Obama would go with Webb, who takes pride in being hard to control.

There’s a lot of attention here on Hagel, an old favorite for the job who — other than making a last-minute cross-aisle endorsement of Bob Kerrey for Senate this year — has largely pulled out of public life since leaving the Senate four years ago. A Vietnam veteran and moderate, Hagel could provide the president with a high-profile bipartisan pick.

There’s also Sen. Jack Reed (D-R.I.), a former Army Ranger, who’s name perennially comes up for the job. Reed presents another Senate appointment problem — Rhode Island Gov. Lincoln Chafee endorsed Obama and spoke at the Democratic Convention, but he’s still a political independent who can be hard to predict.

“You want to get your new team established as quickly as possible and make that transition,” said former State Department spokesman P.J. Crowley, comparing the situation to Bill Clinton’s second term switch to Madeleine Albright at State, William Cohen at Defense and Sandy Berger as his national security adviser. “You could stagger that, but there’s also a compelling argument to ‘Form your new team and keep things going.’”

Attorney General

The uncertainty about Chafee might also impact a possible pick for attorney general, Sen. Sheldon Whitehouse (D-R.I.). Holder is sure to go at some point, but so far, he hasn’t been clear about how quickly he’ll leave. The past few years have been exhausting and the politicization is more than what Holder wants. But they’ve also been liberating — after all, he’s already been held in contempt of Congress and been able to go right on with his job, so there’s not much more that can be held over his head.

The main buzz here is for Patrick, an assistant attorney general under Clinton before being elected in Massachusetts. Between his work as a surrogate, the record he’s continued to build at the statehouse and the personal relationship he’s expanded with the president himself, there are few people whose stock has risen as much as Patrick’s in the past year.

There’s been occasional mention of Preet Bharara, the head of the country’s most prominent U.S. Attorney’s office in New York’s Southern District — he’s young and Indian-American, but he might be more suited for deputy this time to set him up for the top job in the next Democratic administration.

Department of Homeland Security Secretary Janet Napolitano is interested in the job, but she’s also interested in John McCain’s Senate seat in 2016 — and the White House is interested in her as a possible Supreme Court nominee. Granholm — who, like Napolitano, is a former state attorney general — is also seen as a possible fit here.

Homeland Security

Judge Merrick Garland, currently serving on the D.C. Circuit Court of Appeals, is seen as a potential contender for Holder’s job but also could replace Napolitano. Matt Olsen, the director of the National Counterterrorism Center, is seen as a DHS contender as well.

Health and Human Services

One contentious figure who’s expected to stay in place is Health and Human Services Secretary Kathleen Sebelius. She’s steeped in Obama’s health care law, and with the amount of work needed to prepare for most of its provisions to take effect in 2014, making a switch now could complicate things.

Since confirmation hearings for a new nominee would inevitably become an Obamacare retrial, the argument to keep her gets even stronger. There aren’t many replacement options for Sebelius if she goes. As a woman who was elected twice as a Democratic governor of Kansas, she once seemed like a natural Senate candidate back home, but her involvement with Obamacare would likely prove a fatal taint.

Labor, Education, Agriculture, HUD

There’s not much discussion about Hilda Solis — who did not play a significant campaign role despite being a Latino woman with deep connections to unions. Labor isn’t seen as a department that’s likely to face a change soon, nor is Education, where Arne Duncan is clearly enjoying his job and can focus on the policy issues he loves while keeping his spot in Obama’s regular pick-up basketball games. If he does go, former D.C. schools chief Michelle Rhee and Gov. Jack Markell are two possible contenders. HUD’s Shaun Donovan has taken an increasingly strong role within the administration, and there’s no sense he’s going anywhere — there’s thinking that he might be headed for the chief of staff’s office, but not quite yet. Agriculture Secretary Tom Vilsack’s plans will most likely hinge in part on the plans of his wife, who lost her Iowa House race Tuesday.

Interior

Salazar has indicated to friends and other Democrats that he’s on his way out at Interior for a private-sector job back in Colorado, where he has a granddaughter with autism whom he and his wife care for. That could leave the job open for his deputy, David Hayes, but given that the bulk of Interior jurisdiction land is out West, the department’s a natural home for a Westerner former elected official. Among the options: former North Dakota Sen. Byron Dorgan, former Wyoming Gov. Dave Freudenthal and soon-to-be former Washington Gov. Chris Gregoire.

Energy

Chu is probably the Cabinet secretary the White House wants to see go the most. Nobel Prize cachet aside, the Solyndra debacle has been a disaster, and the Hill is unhappy too. Possibilities here include Cathy Zoi, a former CEO of Al Gore’s Alliance for Climate Protection and Kathleen McGinty, the Clinton-era chair of the White House Council on Environmental Quality. This could be a private- sector draw too — there’s talk of Lewis Hay of NextEra Energy and Jim Rogers, the head of Duke Energy who was co-chairman of the Democratic convention in Charlotte.

EPA

EPA Administrator Lisa Jackson has been eyeing a departure for a potential political run where she used to work in New Jersey or back in her native New Orleans. Her successors could be current deputy EPA Administrator Robert Perciasepe, current top EPA air pollution official Gina McCarthy or former Clinton White House aide Ian Bowles, who ran the energy and environmental department in Massachusetts.

The question for all of these picks comes down to a simple question, one former administration official said.

“What’s the narrative?” the official said. “What’s the legacy they want to create, and who are the people they want to do that with?”

Darren Samuelsohn contributed to this report.

CORRECTION: Corrected by: Andrea Drusch @ 11/07/2012 07:03 PM CORRECTION: An earlier version of this story misspelled the names of Sheryl Sandberg, Madeleine Albright and Robert Perciasepe.