Asked why he was naming some of his rivals to top administration jobs, President Lyndon B. Johnson said it best: "I'd rather have them inside the tent pissing out than outside pissing in."
President Obama seems to echo Johnson's management style in his handling of Bill and Hillary Clinton. By bringing them into his inner circle, he has marginalized them both and sharply reduced their freedom of action.
It may appear odd to describe a secretary of state as marginalized, but Obama has surrounded Hillary with his people and carved up her jurisdiction geographically. Former Sen. George Mitchell is in charge of Arab-Israeli relations. Dennis Ross has Iran. Former U.N. Ambassador Dick Holbrooke has Pakistan and Afghanistan. And Hillary has to share her foreign policy role on the National Security Council (NSC) with Vice President Biden, U.N. Ambassador Susan Rice, CIA chief Leon Panetta and NSC staffer Samantha Powers (who once called Hillary a "monster").
With peers who are competitors and subordinates who can deal directly with the president, Hillary is reduced to announcing foreign aid packages for Pakistan while Holbrooke does the heavy lifting.
Part of Hillary's problem is the institutional shrinking of the State Department. During the Bush years, while war raged, the Defense Department became more relevant to the conduct of foreign policy. And, under Obama, the financial crisis has propelled the Treasury into the forefront. State, with its emphasis on traditional diplomacy, has been forced to take a back seat. Even though Obama appointed Hillary, he clearly has not been willing to make her a co-president and confines her to the diminished role of her department.
For his part, Bill Clinton has been asked to be a special envoy to Haiti. Yes, Haiti. Obama's predecessor asked the former president to orchestrate the response to the Asian tsunami and then to Hurricane Katrina. With Obama, he gets Haiti.
Meanwhile, both Clintons are effectively muzzled and cannot criticize Obama even as he reverses President Clinton's free-market proclivities and budget-balancing discipline. Hillary, the supposed friend of Israel, must sit by quietly and watch Iran get the bomb while trying all the while to stop Israel from preventing it.
Bill can't even make money. Denied the ability to accept speeches from foreign governments or their organs and fenced out of continuing his profitable relationship with the emir of Dubai, he and his wife must accept the loss of the $13 million they spent on her campaign and sit by passively, unable to earn the money to replace it.