Inspired by Al Giordano’s musical chairs consolation prize theory, I thought I’d look at how Obama can use the selection of Joe Biden as running mate to move his key allies into important positions. It starts with moving Biden into the Naval Observatory, opening up the chairmanship of the Foreign Relations committee. As Al points out, the chair would naturally fall to Chris Dodd. But, by appointing Dodd (who is retiring in 2011 anyway) to head the State Department, the Foreign Relations chair would fall to John Kerry. In this situation, the three top members of the committee would be dispersed to where Obama could use them to maximum advantage. Biden would be VP and have a seat on the National Security Council with Secretary of State Dodd. Kerry would head up the international relations effort in the Senate.

The only downside to this is that Connecticut Governor Jodi Rell would be able to appoint a Republican to fill out the remainder of Dodd’s term. Yet, considering that the seat will be open during the 2010 election, this is hardly that big of a hit to take to get the foreign policy team in place that you want.

Of course, the musical chairs would not end there. Dodd’s promotion would open up the chair of the Senate Committee on Banking, Housing, and Urban Affairs. Sen. Tim Johnson of South Dakota (an Obama endorser and ally of likely chief of staff Tom Daschle) would be next in line. If Johnson’s health prevents him from assuming the position, it would fall to VP short-list candidate Jack Reed of Rhode Island. Who better to clean up the banking fiasco and enact Obama’s Urban Policy than a good progressive like Reed?

There would be other power shifts, too. Assuming she wins reelection, Sen. Mary Landrieu would be in position to take over Kerry’s chairmanship of the Senate Committee on Small Business and Entrepreneurship, thereby increasing the female institutional power of the upper body (Feinstein currently chairs Rules, while Boxer chairs Environment & Public Works). It’s also possible, if Teddy Kennedy cannot continue on as head of the Health Labor Education & Pensions (HELP) committee, that the position could fall to Barbara Mikulski of Maryland (a key Clinton supporter).

Meanwhile, the Governor of Delaware (most likely to be a Democrat) would appoint Joe Biden’s replacement in the Senate. It’s not unlikely that Joe’s son, Beau, would get the nod. Beau Biden would join a new senator from Illinois (Jan Schakowsky?) as key young allies of the new administration.

If Obama decides to tap Kerry as Secretary of State rather than Dodd, most of these chips would fall the same way, but it would be Obama’s dear friend, Massachusetts Gov. Deval Patrick, who would appoint Kerry’s replacement. You can take your pick from five Massachusetts congresspeople that endorsed Obama: John Olver, Richard Neal, Niki Tsongas, Michael Capuano, or William Delahunt. My money would be on Delahunt.

It’s amazing how one little decision like who will be your running mate can be utilized to change around so many fiefdoms and power structures.

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