Obama’s promised change will be seen largely in non-economic areas such as civil liberties, the environment, regulatory issues, race relations, diplomatic protocols, and so on.
In the realm of economics too the Obama administration will have to bring about some policy changes. This would consist largely of a “job creation” stimulus package that would be geared to infrastructure repair and expansion, especially in the areas of mass transit and public transportation. Such an economic stimulus package, however, would be due to no thanks to Obama, as it would be dictated largely by the dire socio-economic conditions on the ground, that is, by market imperatives, or the mission to rescue capitalism.
The Obama administration will also have to introduce some major changes in the financial sector. This would most probably include nationalization of a number of major banks such as the Citigroup that are technically bankrupt but their insolvency is (so far) not acknowledged—banks whose toxic assets are too huge to be bailed out [6].
Based on all the major signs and signals revealed thus far, Obamanomics portends to be an amalgam of Herbert Hoover economics, New Deal economics and Reaganomics.
The Hooverian component of Obamanomics is clearly reflected in his support for the Wall Street bailout scam. In the face of the Great Depression, President Hoover (like the current government, supported by Obama) showered the bankers with public money in an effort to bail them out. All he did, however, was to prolong the crisis; the policy eventually led to the failure of almost all banks within two years.
The New Deal component of Obamanomics would consist of his administration’s having to put into place a “job-creation” stimulus package that would include relatively extensive investment in public works project.
And the Reaganomics component would consist of financing such a stimulus package through major banks and the Wall Street financial intermediaries. Instead of directly financing public works projects through the federal, state and local governments, with open and rigorous public oversight, the Obama administration seems intent on, first, giving/lending taxpayers’ money to money-center banks, and then having them re-lend that money for public works projects—and make fortunes in the process.
This would be a boon for the failed financial giants of the Wall Street, as it would represent yet another, indirect or roundabout, way of bailing them out. It can, therefore, be called New Deal reforms carried out by methods of Reaganomics—through the outsourcing of the financing aspect of the public works projects.
4. Lessons for the grassroots
Political implications of this discussion for the grassroots are unmistakable: unless effective pressure from below is brought to bear on the Obama administration and the Congress, the urgently needed economic changes will be geared, primarily, to the interests of corporate America, especially the corrupt financial giants of the Wall Street. People pressure is needed to counterbalance the pressure from the captains of capital, who are busy dictating Obama’s choice of cabinet members and other appointments, as well as his economic agenda.
To be effective, the pressure from below has to go beyond sending e-mails or making phone calls to the offices of the elected officials, as they are largely in the pockets of the ruling plutocrats and are hopelessly corrupt. Only through widespread and sustained protest demonstrations and non-violent civil disobedience that would threaten the status quo can a relatively radical change in favor of the grassroots be forced upon the ruling class.
The following is a partial list of demands around which such mass protests can be mobilized—demands that are, incidentally, by no means radical or revolutionary. They are, indeed, marginal financial and fiscal changes that can be implemented within the existing system and its institutions.
1. Demand the establishment of a universal health care system. While many Americans don’t seem to be yet ready to demand socilized medicine (like what some Europeans enjoy), a single payer system like Canada's would be a huge improvement, as it will save money and cover all Americans.
2. Demand the following regarding the market meltdown, the rescue/bailout plans, and monetary policy:
a. full disclosure and transparency of the books and balance sheets of the insolvent financial institutions;
b. full and open accountability for management policies and practices that led to the insolvency of those institutions. This is meant not to be so much for “crime and punishment” reasons as for diagnostic and preventive ones.
