What has been rumored for weeks is now official: Rahm Emanuel is stepping down as White House chief of staff to explore a bid for mayor of Chicago. He’ll soon embark on a Chicago-wide "listening tour," which will require a remarkable amount of restraint for the foul-mouthed pol.

As I wrote in a Nation blog earlier this month, Rahm’s exit is a good thing for Obama and a necessary first step in the much-needed shakeup of his White House. Rahm alone wasn’t solely responsible for diluting Obama’s unique outsider brand, but he was a major contributing factor. After all, throughout his career in politics, Rahm has been at odds with the very grassroots activists who propelled Obama to the White House and made his campaign so unique. That pattern continued when Rahm became chief of staff and purposely demobilized and insulted Obama’s ground troops.

I explain this in a new Nation excerpt of my new book, Herding Donkeys: The Fight to Rebuild the Democratic Party and Reshape American Politics:

The White House doesn’t want its activists to disrupt the backroom deals its aides cut with lobbyists and legislators, nor does it want them putting too much pressure on obstructionist Democrats, lest it alienate key swing votes in Congress. When MoveOn.org ran ads targeting conservative Democrats who were blocking healthcare reform, Rahm Emanuel memorably called the ads "fucking retarded." And, indeed, the White House has expended considerable political capital denouncing the "professional left" and defending apostate Democrats like Blanche Lincoln in Arkansas from insurgent primary challengers, which has further undermined Obama’s reformist brand.

"I’m not looking to pick another fight with Rahm Emanuel, but the contempt with which he held the progressive wing of the party was devastating and incredibly demoralizing," Howard Dean says. "That’s basically saying to your own people, You got us here, now F-you." The progressive voices Emanuel excluded from Obama’s inner circle included Dean himself, who famously clashed with the chief of staff over how and where Democrats should spend their limited resources in 2006. Emanuel’s elevation—and Dean’s snub—has come to signify a broader abandonment of the party’s grassroots base, especially as Obama packed his White House with well-worn veterans of previous administrations, quite an irony given his critique of Hillary during the primary as a washed-up Washington insider. The top-down structure of Obama’s administration is the virtual opposite of his campaign.

Slate‘s Dave Weigel recently wrote about how Rahm’s reputation as a master strategist, mostly owing to the Democratic takeover of the House in ’06, has always been overblown.

Nor has Rahm’s other alleged biggest asset—his ties to Capitol Hill and intricate knowledge of Beltway politics—been of much help to Obama. Much of the legislative agenda Obama passed—from healthcare to the stimulus to financial reform—has either been less substantive than his supporters and the general public wanted or the process by which the legislation got passed, particularly on healthcare form, turned popular pieces of legislation into unpopular ones. It’s hard for Rahm to duck the blame on that front; he’s done little to curb the dysfunction of the Democratic Congress, particularly in the Senate, where Obama’s legislative agenda has hit a brick wall of obstructionism.

Maybe Rahm’s replacement, White House senior adviser Pete Rouse, will have better luck. After all, Rouse served as a top aide to former Senate majority leader Tom Daschle and understands the unique customs of the Senate better than anyone. Rahm’s turbulent tenure in Washington has proven that traditional inside-the-Beltway experience can be overrated, particularly when your boss was supposed to personify the dawn of a new political era. Now is the time for Obama to focus on reinspiring his grassroots base outside-the-Beltway. But if he’s is going to play the Washington game, he might as well play it well.