| Long-Term Strategies
End the War in Iraq and Invest in Infrastructure Here: "Instead of spending twelve billion dollars a month to rebuild Iraq, I think it's time we invested in our roads and schools and bridges and started to rebuild America."
Improve Science Education and Prepare Us for Jobs of the 21st Century: "It's an agenda that will require us first and foremost to train and educate our workforce with the skills necessary to compete in a knowledge-based economy."
Create Real Special Interest-free Free Trade: "We do the cause of free-trade - a cause I believe in - no good when we pass trade agreements that hand out favors to special interests and do little to help workers who have to watch their factories close down."
Make the Tax Code Simpler and More Progressive: "I'll shut down the corporate loopholes and tax havens, and I'll use the money to help pay for a middle-class tax cut that will provide $1,000 of relief to 95% of workers and their families. I'll make oil companies like Exxon pay a tax on their windfall profits, and we'll use the money to help families pay for their skyrocketing energy costs and other bills. We'll also eliminate income taxes for any retiree making less than $50,000 per year, because every senior deserves to live out their life in dignity and respect."
Short-Term Strategies
Increase the Stimulus:: He wants to put $50B in the hands of families in addition to the checks we received in May, and extend unemployment insurance.
Increase Transparency in Mortgage Markets and Offer Relief to Homeowners: Obama is promising to "crack down on mortgage fraund", "$10 billion Foreclosure Prevention Fund", and offer "a tax credit to low- and middle-income Americans that would cover ten percent of their mortgage interest payment every year."
Offer Congressional Health Plans to Every American: "We will give every American the chance to get the same kind of health care that Members of Congress give themselves. We'll bring down premiums by $2500 for the typical family, and we'll prevent insurance companies from discriminating against those who need care most."
Enact Pay as You Go Budgeting: "Now, contrary to what John McCain may say, every single proposal that I've made in this campaign is paid for - because I believe in pay-as-you-go."
Reform Bankruptcy Laws and Implement a Credit Card Bill of Rights: "And we'll establish a Credit Card Bill of Rights that will ban unilateral changes to credit card agreements; ban rate hikes on debt you already had; and ban interest charges on late fees. Americans need to pay what they owe, but you should pay what's fair, not just what fattens profits for some credit card company and they can get away with."
Analysis
The central challenge of his strategy is that while he believes that we are undergoing a fundamental structural shift in our global economy, the changes he is proposing, with the exception of health care, are somewhat small-bore. This makes sense when you examine his economic team in a bit more detail. The big news on that front is that Hamilton Project denizen and neoliberal economist Jason Furman is Obama's newest economic advisor. Steve Clemons a noted, "To some degree, Furman manifests the interests and perspective of perhaps the leading neoliberal force in politics today, Robert Rubin." Furman is not Rubin, but Clemons thinks that he is "an essential spear-carrier of Rubinomics."
Furman's his defense of Walmart as a 'progressive success story' provides an element of caution to the good news about Obama's strength as a candidate. I am not ringing alarm bells about Obama as a NAFTA loving centrist, or suggesting that Furman is a bad choice for an advisor. I know and like Austan Goolsbee, and Furman is probably a highly intelligent and open-minded policy advocate. Additionally, the economic debates have moved far beyond that, and he's likely to pull as much of his policy ideas from Cass Sunstein and Richard Thaler's Nudge with its behavioral economics frame of 'choice architecture', or 'libertarian paternalism' in which the government gently slopes the choices we face in ways that are good for us, without banning bad choices outright. Opt-in, opt-out, and default choices, for instance, are significant and substantial forces in governing our society, and my guess is that Obama believes strongly in making small adjustments for big impacts.
In his discussion of McCain's policy impetus, Obama offers a contradiction on global warming. Here he is in the speech.
[McCain] can also legitimately tout moments of independence from his party, and on some issues, such as earmark reform and climate change, he and I share goals, even if we may differ on how to get there.
Yet here is Obama in his pep rally to staffers.
"Those of you who are concerned about global warming, I don't care what [McCain] says he is not going to push that agenda hard."
I happen to agree with the latter and not the former, but there is a basic inconsistency that flows through Obama's policy choices, one that is perhaps inevitable. Paul Krugman notes that the American citizen consumes about a thousand gallons of oil a year, and it is quite clear that the price is going to continue spiking unless the massive printing of money going on at the Fed stops (something the Cunning Realist is harping on incessantly). That means a nasty recession and a different development pattern in which cheap energy is no longer the law of the land.
Frighteningly, in fact, if we are at peak oil, which means an abrupt transition to a different energy source, the Bush Energy Department in 2005 laid out the grim possibilities. Here's the assessment: "The world has never faced a problem like this. Without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary. Previous energy transitions (wood to coal and coal to oil) were gradual and evolutionary; oil peaking will be abrupt and revolutionary."
Obama knows this; in one of his only diaries on Dailykos, back in 2005, he made this statement. "Unless we are open to new ideas, and not just new packaging, we won't change enough hearts and minds to initiate a serious energy or fiscal policy that calls for serious sacrifice."
Today we got a set of small bore policy ideas that hint at a more transformational set of choices we have to make. It would be foolish for any politician to say that in his administration we will have a nasty recession upfront, that gas prices aren't going to come down, and that lots of people are going to suffer from a transition to a new energy system. He's just arguing for change, which is the right argument. FDR did not call for a New Deal until the Convention, and ran on the gold standard and balancing the budget.
As Obama moves forward, it's worth noting where he is, having adopted a standard set of mainstream Democratic economic policy ideas, so that we can see where he goes. |
