Day Four, March 28

Today on the drive to work I was listening to NPR, and caught the tail end of two political panelists (columnists from the Washington Post and New York Times) talking about recent developments, or lack thereof, in the race for Democratic presidential nominee. The final question that the host proposed to his guests was whether this year's presidential race would come down to the war in Iraq, or economic and domestic concerns in the U.S. Both columnists agreed that this year's election would "definitely" be decided by the latter, which was "good news for the Democratic party." Although all three presidential candidates have been reluctant to acknowledge the possibility of a recession in the American economy (or the increasingly obvious fact that we are already in one), any potential candidate for the presidency has no choice but to recognize that the economy is in trouble, and needs a shot in the arm to avoid seeing the bottom fall out of the housing market as well as to prevent the continued floundering of Wall Street on a weekly basis.

Yesterday, both Democratic nominees clarified their positions on how they plan to fix the economic woes the country is facing. Both Obama and Clinton took a rest from highlighting the differences between themselves for once, and turned their barbs against John McCain's own economicaly conservative policies, which Obama said "amounts to little more than watching this crisis happen.'' In a two-prong entry, today I'm including both a video capture of Senator Obama's speech yesterday at Cooper Union in New York that outlines his economic outlook in his own words, as well as a link to an article from The Guardian regarding both Obama's and Clinton's plans to repair the state of the union. Click here to read that article, written by Devlin Barrett and Beth Fouhy, of the Associated Press.

Obama's speech:


The speech itself is something to behold, but in the interest of immediacy, I've attempted to sum up the main points of Obama's plan here. My own grasp of economic frailty is limited (as I will soon demonstrate), but here are the six points that Obama says need to be taken into action to repair the economy:

1.) Any institution that is able to borrow from the Federal Reserve should also be called to answer to any guidelines that the Fed should deem appropriate for these institutions.

2.) General reform is needed in all regulated financial institutions. This is particularly relevant in the mortgage business, to prevent another housing calamity from occurring in the future. This applies for domestic institutions, as well as those that the U.S. is subject to overseas, both to stablize economies and to maintain competition between said institutions.

3.) It is time to restructure regulatory agencies to meet needs for the current U.S. marketplace. Many of these agencies are either being reorganized constantly or are still under the same guiding policies as they were decades ago, and adopting streamlined approach to increase their functionality.

4.) One of the main causes contributing to the current mortgage crisis is the fact that two-thirds of sub prime mortgages were obtained from companies that didn't adhere to the same tight regulations that banks are required to follow. Where these loans originate shouldn't matter, and regulations should be enforced across the board to protect homeowners.

5.) Heightened vigilance is needed in the stock market to prevent marketplace manipulation activities by traders. These type of activities should be liable for punishment from the Security and Exchange Commission.

6.) A financial market commission should be created to oversee the state of the economy and assess upcoming risks we are facing. Such a commission would meet regularly and advise the President, Congress and market regulators about economic risks ahead, so that action can be taken to combat potential problems before they grow.

A complete transcript of the Senator's speech can be retrieved here, from barackobama.com