Obama’s Economic Plans Would Benefit America’s Workers

by Mike Hall, Sep 19, 2008

The last time we faced a Bush recession, presidential candidate Bill—”It’s the economy stupid!”—Clinton offered voters an economic alternative to the failed Bush I policies and went on to create eight years of national prosperity.

Today, as the Bush II recession explodes, littering the nation’s economy with failed banks, Wall Street bailouts and disappearing jobs, Sen. Barack Obama offers an economic plan to steady the economy and bail out Main Street. (Click here to view Obama’s new two-minute campaign ad in which he details his economic plans.)

Speaking at the Machinists (IAM) convention last week, Obama said that for nearly eight years, the Bush administration—with the backing of Sen. John McCain, who has a 90 percent Bush voting record—sat back and watched as

corporate lobbyists wrote our laws and put their clients’ interest ahead of what’s fair for the American people. They looked the other way as working families watched their incomes fall, their bills soar, their homes foreclosed and their savings vanish. They shrugged as more than 3.6 million manufacturing jobs were lost….Too many American workers saw a lifetime of labor rewarded with a pink slip and dumped pension as their jobs moved offshore.

Earlier this week in Golden, Colo., after the Wall Street train wreck that saw the bankruptcy of Lehman Brothers, the takeover of Merrill Lynch and the government bailout of insurance giant AIG, Obama said:

This is what happens when you see seven years of incomes falling for the average worker while Wall Street is booming, and declare—as Sen. McCain did earlier this year—that we’ve made great progress economically under George Bush.

Calling for a Main Street bail out, Obama has hit home his plan to create jobs, heal the economy and curb Wall Street excess.

In the near term, Obama is calling for a second economic stimulus—$50 billion that would create 1 million jobs through projects to rebuild roads, bridges and other infrastructure, repair schools and help states and cities avoid cutting damaging budget cuts that would reduce vital services to working families. Unbelievably, McCain is not calling for a second stimulus package—and, in fact, skipped the vote on the first one Congress passed this spring.

Obama told IAM convention delegates that for the long term, he would “revive and strengthen American manufacturing” with a $150 billion 10-year program in the green energy sector that could create as many as 5 million jobs. In addition, he calls for a new Advanced Manufacturing Fund that would focus on innovation and job creation in areas hit the hardest by the decline of manufacturing.

Unlike McCain, whose policies have abetted job outsourcing, Obama would end job-exporting tax breaks backed by the Bush administration so that corporations will not be encouraged to ship U.S. jobs out of this country. In fact, he is calling for tax incentives for companies the create and keep jobs in the United States. He also vows to fix flawed trade deals like the North American Free Trade Agreement (NAFTA) and pursue trade agreements with strong labor and environmental standards.

To help working families pay their bills, Obama’s tax reform and tax cut plans would give a $1,000 tax break to the middle class. Unlike McCain’s tax proposals, which would benefit the wealthy and shower tax breaks on oil companies, Obama’s tax cut would give the biggest relief to those at the bottom of the income ladder. Under McCain’s plan, the richest 1 percent would receive the biggest tax cut. (Click here for a comparison of the two plans.) As Obama said in his Colorado speech:

I offer three times the tax relief for middle-class families as Sen. McCain does—because in an economy like this, the last thing we should do is raise taxes on the middle class.

McCain long has supported minimal regulation of the nation’s financial markets (until this week, that is). And it was Phil Gramm—architect of McCain’s economic plan—who led the charge while he was senator to give banks, brokerage firms and Wall Street pretty much free rein to do business with little oversight. Most economists say that deregulation is the fuel behind the Wall Street collapse, mortgage meltdown and credit crunch.

This week, as Obama outlined a “21st century regulatory framework” for the nation’s financial industry, he said:

Our capital markets cannot succeed with the public’s trust. It’s time to get serious about regulatory oversight.

Among his goals:

• Cracking down on trading activity that crosses the line to market manipulation.
• Streamlining regulatory agencies.
• Establishing a system that identifies systemic risk to the financial system.
• Ensuring that regulations match the functions of the financial institution. For example, guidelines on subprime mortgages covered commercial banks and thrift institutions, but the rules did not apply to mortgage brokers.

While in Colorado, Obama summed up his economic policy speech:

My priority as President will be the stability of the American economy and the prosperity of the American people. And I will make sure that our response focuses on middle-class Americans—not the companies that created the problems.

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