Researching Barack Obama’s philosophical influences, I came across an article called Obamanomics by David Moberg and published in the left-leaning, In These Times.
The March, 2008 article is worth a read in light of the current economic troubles. Moberg predicts the current crisis and discusses Obama’s position regarding the financial industry at that time:
Subprime plans
When it comes to many of the larger issues hounding the economy, Obama hasn’t done much to distinguish himself. He has not been a visionary on the subprime crisis, and his adviser Goolsbee indicated in a New York Times column that the only problem is the rampant fraud that was an integral part of subprime lending. In his proposal to deal with the subprime mortgage debacle, Obama does not support the foreclosure moratorium and interest rate freeze that Clinton and many citizen and labor groups advocate.
But Dean Baker, co-director of the Center on Economic and Policy Research and an early forecaster of housing bubble problems, argues that Obama’s plan is admirable because it is less of a bank bailout than Clinton’s. The problem now, he points out, is not so much the interest rates that are resetting at a higher level, but that the value of people’s houses has declined to less than what they initially paid. Baker advocates guaranteeing people facing foreclosure an option to rent their homes at fair market value. This would avoid many evictions and pressure banks to work out more favorable mortgage agreements.
Obama’s main flaw seems to be excessive caution, not favoritism to the financial services industry, which has contributed almost as much to him as it has to Clinton. But Obama is not beyond influence.
Obama’s national finance chair is Penny Pritzker. Chicago’s wealthy Pritzker family owned half of Superior Bank, a pioneer in subprime lending. When the bank failed in 2001, the family signed a sweetheart deal with federal regulators that let it off with a profit while many depositors lost money. (But Penny’s brother, J.B. Pritzker, is a major Clinton supporter.)
And for years, executives of Exelon, the Illinois-based nuclear utility, have been among Obama’s biggest contributors. (Obama insists nuclear power should not be ruled out as a potential energy source, even if he also promotes alternatives.)
There are many culprits in the current financial melt-down. However, I am puzzled that Obama is viewed by the general public as better able to handle the economy than McCain.
The Pritzker connection seems troubling. Given her experience with subprime lending, I wonder why she was not sounding the alarm.