When Goldman Sachs announces recession and the Federal Reserve chairman on the same day promises ready-to-go interest rate cuts, you can take it to the bank: the recession is official. The 2008 campaign's refreshing spirit--the chorus of "change, change, change"--is joined by a more traditional theme. "Jobs, jobs, jobs." Suddenly, everyone wants to sound like a Keynesian liberal, ready to prime the pump with federal spending.

My advice to Barack Obama: look through the John Edwards file--he got there first--and borrow freely from his sound ideas for economic stimulus. Then double or triple Edwards' numbers to show your sincerity. Do this fast. Hillary Clinton is already out of the box with a plan the New York Times describes as the first from any Democratic candidates.

Wrong. John Edwards was out front with aggressive anti-recession proposals in early December. Act now, he said, don't wait for the official announcement. First, Congress should put up at least $25 billion to stimulate job creation and be ready to spend another $75 billion as things get worse. Spend the money on "clean energy" infrastructure, the housing crisis, reform of unemployment insurance, aid programs to help families get through hard times and other wounds. Get the money out to the folks who will spend it right now and to public works projects that can create new jobs quickly.

Nothing fancy in the Edwards package, just the old-fashioned, meat-and-potato politics that used to make Democrats the party of working people. In the scale of what's happening to the economy, I think his proposals are too modest. Bill Gross, the insightful managing director of PIMCO, the major bond-investment house, has called for virtually doubling the federal deficit in order pump hundreds of billions into new economic activity. When bond holders are more alarmed about the economy than political leaders, you know something is backwards in American politics.

Edwards, alas, probably restrained the size of his stimulus package to convince the media gatekeepers he is not wacko and thus win some coverage for his forward thinking. No such luck. Edwards has his own shortcomings, but he has been victimized by the shallow political culture that empties meaning from presidential campaigns. The press early on consigned him to the "populist" stereotype and largely ignored the serious content of his agenda.

This is the curse that leads to enervating, brain-dead presidential cycles. Substance bores political reporters. Most of them do not understand economics or even know much about how government actually works. Given their ignorance, they prefer to play the role of theater critics and imagine that readers are desperate to hear their highly subjective and utterly unreliable reviews of the sideshow.

Actually, it's worse than that, as we witnessed again in New Hampshire and Iowa. Reporters read the polls--slavishly rely on them--then go out and gather connect-the-dots tidbits that appear to confirm the poll results. When polls are wrong, reporters are wrong. And shameless in their denials of culpability.

If reporters were to give up the arrogant role of reviewers, they would have to do real work--the unfashionable task of reporting on what candidates actually say. Then the diligent would subject the substance, not style, to critical analysis and reactions from many quarters. This drudgery would seem humbling to the "boys on the bus." Most of them, anyway, are incompetent to do such work.

Barack Obama has a soaring message and charismatic authenticity, but he is vulnerable to mindless media judgments for almost an opposite reason. Despite his compelling rhetoric and character, Obama has left too much unsaid (or maybe we just haven't heard what he did say). If Obama loses contests here or there, I expect another stereotype will be assigned by the reviewers to explain the results--Senator Lite. A nice enough guy but weak on substance, not ready for prime time.

From what I know about the man, that is a cruel distortion of his depth and temperament, but he does need to fill in some blanks. The recession gives Obama a ripe opportunity to protect himself from media labeling, without changing character. First, produce the concrete policy proposals demanded by competitive campaign rituals. Then speak more loftily and ambitiously about the American economy and what Obama envisions for the more distant future. What might it look like then years hence? How does he hope to get there? These are reasonable questions he has not yet addressed, but can answer in broad strokes. Or maybe he already has addressed them and the media thought it sounded boring.

Comments (16)

1. Shoula listened to Edwards from the beginning he has been the only person to offer up real economic policies the other candidates have just been parating him so far. Now we are in a recession and we are choosing the two candidates who have said least about what they actually want to do to FIX economy.

   Posted by Cccomfo1 at 01/11/2008 @ 8:49pm

2. "These are reasonable questions he has not yet addressed, but can answer in broad strokes. Or maybe he already has addressed them and the media thought it sounded boring."

   Or, maybe, just maybe he put it someplace where it can be easily found. I know, perhaps you can find it at his website? I know it's a radical idea but what have you got to lose?

   You might find something, under guess what, economics ... that looks like this:

   * Tax Fairness for the Middle Class

   * Strengthen America's Workforce

   * Strengthen & Enforce International Trade Agreements

   * Support Small Businesses

   * Invest in American Innovation

   * Address the Subprime Mortgage Issue

   * Level the Playing Field for American Businesses

   * Create a Climate that Promotes Business Innovation

   * Help Low-Income Workers

   * Provide Universal Health Care Access

   * Energy Independence and Creating New Jobs

   (I really like this next one, it's my favorite in fact. Why don't you give it a shot William, and share the response, with us?)

   Speak your mind and help set the policies that will guide this campaign and change the country.

   * Present your ideas

   Posted by V at 01/11/2008 @ 10:59pm

3. V -- Also, address the trade deficit. How can you have a modern economy without manufacturing?

   Posted by wgilwood at 01/12/2008 @ 12:04am

4. V -- Also, address the trade deficit. How can you have a modern economy without manufacturing?

   Posted by wgilwood at 01/12/2008 @ 12:04am

5. The point is, ladies and gentleman, that class warfare -- for lack of a better word -- is good.

   Class warfare is right.

   Class warfare works.

   Class warfare clarifies, cuts through, and captures the essence of the evolutionary spirit.

   Class warfare, in all of its forms…has marked the upward surge of mankind.

   Posted by Marc Schlee at 01/12/2008 @ 12:42am

6. Mr. Obama's campaign said he will unveil proposed stimulus legislation in coming days. His plan would likely include expediting a $500-a-person tax credit already proposed by the Illinois senator for low- and middle-class workers. He says the tax credit would benefit an estimated 150 million Americans. - WSJ

   It sounds like Obama will be discussing specifics of his economic stimulus and recovery plan very soon!

   Posted by Metteyya at 01/12/2008 @ 07:27am

7. Greider:

   Edwards has his own shortcomings, but he has been victimized by the shallow political culture that empties meaning from presidential campaigns. The press early on consigned him to the "populist" stereotype and largely ignored the serious content of his agenda.

   This is the curse that leads to enervating, brain-dead presidential cycles. Substance bores political reporters. Most of them do not understand economics or even know much about how government actually works. Given their ignorance, they prefer to play the role of theater critics and imagine that readers are desperate to hear their highly subjective and utterly unreliable reviews of the sideshow.

   Actually, it's worse than that, as we witnessed again in New Hampshire and Iowa.

   Loved that passage --and let's not forget that The Nation was guilty, as well, of not taking Edwards seriously enough in my opinion.

   I'd enjoy seeing more frequent blogposts by Mr. Greider.

   Posted by b_kool_66 at 01/12/2008 @ 3:13pm

8. "How can you have a modern economy without manufacturing?"

   Posted by WGILWOOD 01/12/2008 @ 12:04am | ignore this person

   (Our real trade deficit is called NAFTA.)

   You cannot, there is no such thing as a modern economy without manufacturing. Despite the now revealed to be blather, that the ones whose consul led us into this mess, still, profess. Only someone corrupt, or, taken directly from highschool, and processed, conditioned ... for the next four, or six to eight years could be expected to champion something so nonsensical, as a non-manufacturing, "service" economy.

   A shift, towards medium-term to long-term capital investment in employment. Targeted towards the production of critical, basic, economic infrastructure, green technology wither or no global warming is caused by humans or not, and otherwise useful physical goods ... Combined with low interest loans of terms at a minimum of fifteen out to fifty years.

   What has to be done? As usual the first thing that needs to be done is ask oneself a few questions, such as: When have a people in general, and Americans in particular been in, or faced this situation before?

   By the morning of Franklin Roosevelt's inauguration as President on Saturday, March 4, 1933, 25%--and growing-- of Americans were unemployed, many for two years, at a time when loss of a job usually meant loss of all means of existence. And after years of relentless downward pressure on wages, millions of those still employed received a wage which was only a negligible share of a minimal family budget.

   FDR ...

   Hitler had been made dictator of Germany immediately before Roosevelt's inauguration--not coincidentally, under conditions quite like these. Now, place yourself back in early March 1933. How many more weeks of this Hell could our own national spirit have survived, before Hitler became unstoppable?

   President Hoover (if I, if we ... were to cast his part played, in a drama, who would we pick? Any republican would do, doubtless. Unfortunately so would any one of the present Democratic leadership) meanwhile, hid paralyzed in a White House barricaded off behind slogans about "free markets." To avoid the drift toward a superstate, he said he wanted "to solve great problems outside of government action." Victory over the Depression must be won "by the resolution of our people to fight their own battles in their own communities...." The question for the future, he believed, was whether history should be written in terms of individual responsibility or of the "futile attempt to cure poverty by the enactment of law." Depression, he said, could not be ended "by legislative action or executive pronouncement. Economic wounds must be healed by the action of the cells of the economic body." In other words by the fiat of divine will, ergo, the "market."

   The first call for "action" in the new President's (FDR's) Inaugural Address, attacked unemployment: "Our greatest primary task is to put people to work," declared Roosevelt. "This is no unsolvable problem if we face it frankly and courageously. It can be accomplished in part by direct recruiting by the government itself, treating the task as we would treat the emergency of a war, but at the same time, through this employment, accomplishing greatly needed projects to stimulate and reorganize the use of our natural resources."

   In this task, Roosevelt found a providential man in Harry Hopkins, a leading social worker, the son of an Indiana saddle-maker, and a graduate of Grinnell College in Iowa, with its tradition of Christian social activism. Hopkins had earlier worked for Roosevelt when the latter was Governor of New York.

   Although both he and the President favored provision of useful work over mere relief, Hopkins was brought on board on May 22, 1933, for a still more urgent mission, when state, local, and other sources of subsistence had essentially been exhausted, as 17-18 million Americans stood in immediate need. "In less than an hour, Hopkins was in his office headquarters. Surrounded by boxes, unpacked files, and typewriters, workers arranging furniture, and without organized clerical help, he initiated within twenty-four hours formation of a staff, a notice to governors to form state relief organizations, and disbursement of over $5,000,000 of federal relief money to seven different states."2

   Faced by what he knew would be a bitter winter, in 1933-34, Hopkins on Nov. 1 presented the President with a plan for a Civil Works Administration (CWA), to be run by his staff, which would initiate federally sponsored work projects throughout the nation, mainly projects of city, county, and state infrastructure, to be designed, planned, and proposed to CWA by those government units. These included repair and construction of streets, roads, schools, public buildings, playgrounds, and parks, as well as flood control, sewage, and water management, and much else of that sort. Roosevelt created the agency nine days after their meeting. Its budget eventually rose to $900 million. - Back to Work -

   Hopkins managed to employ 800,000 people on such worthwhile projects within ten days. Nearly 2 million had been employed by two weeks later. Nine weeks after the CWA had been started--in the week ending Jan. 18, 1934--the CWA had its peak employment of 4,263,644 men and women. Despite orchestrated charges of corruption and waste in the controlled press, the exhaustive investigations found very little of either. A study commissioned by the Army praised Hopkins and his staff for what had been the largest peacetime project in U.S. history, noting that he had mobilized "in two months nearly as many persons as were enlisted and called to the colors during our year and a half of World War mobilization...."3

   Beyond preserving the lives and labor power of over 16 million Americans during a cruel winter, CWA built and repaired over 40,000 schools and 255,000 miles of roads and streets; built 469 airports and improved 529 others; laid 12 million miles of sewer pipe; employed 50,000 teachers so that many rural schools could remain open; and built 3,500 playgrounds and athletic fields."

   So we have a foundation, of successful acts ... far greater than the mere empty rhetoric, composed of nothing but tax cuts. As the above history shows. The national interest, as it was understood at the time, dictated that the CWA, FERA, and WPA concentrate on projects which could be started quickly, and which emphasized labor costs, both skilled and unskilled, in preference to large capital investments. These agencies in general did not hire contractors, just as the sort of local infrastructure in which they specialized had often before been built and maintained by municipal, county, or state workers. It was the complementary role of Ickes' PWA and the TVA which built such great projects of national infrastructure as the Grand Coulee Dam, Bonneville Dam, and of course the great projects on and around the Tennessee River, and many others less well-known. In contrast to Hopkins' agencies, the work of the PWA and similar agencies had long lead-times, was capital-intensive, and employed contractors and subcontractors. Hopkins and his (CWA) would have been great to have around, before, during, and after Katrina, yes?

   Posted by V at 01/12/2008 @ 6:35pm

9. 1

   Link 1 [ssa.gov]

   2

   Link 2

   Links for the above.

   3

   Link 2

   Posted by V at 01/12/2008 @ 11:16pm

10. WTF ... let me try again.

    1 http://www.ssa.gov/history/court.html

    2 http://www.encyclopedia.com/doc/1E1-HopkinsH.html

    3 http://www.encyclopedia.com/doc/1G1-54859916.html

    Links for the above.

    Posted by V at 01/12/2008 @ 11:24pm

11. Hillary or Obama...there WILL NOT be..

    1. a new "New Deal" or new "Great Society" mass of domestic programs.

    2. tariff increases

    There WILL BE...

    1. a lot of disappointed economic liberals from Mr Grieder to Ms vanden Heuvel.

    2. a balanced (not Empty-style) view of the economy.

    Posted by Mask at 01/13/2008 @ 08:06am

12. Obama addressed the economy by proposing a $75 billion stimulus plan as he started his campaigning in Nevada.

    The plan included an immediate $250 tax credit to workers that could double if the economy worsens, a one-time $250 supplement to Social Security payments, $10 billion to help homeowners facing foreclosure and a $10 billion to bolster states facing budget shortfalls amid the uncertain economy.

    "We need that middle-class tax cut now more than ever -- not five months from now or five weeks from now but now," Obama said in a statement. - Reuters, 1/13/07

    Posted by Metteyya at 01/13/2008 @ 4:41pm

13. Keynesian economics will be helpful, but before you change the economic system you must first control the economy. This means we must withdraw from the WTO, NAFTA, and other "Free Trade" Agreements. You need also to impose tariff to protect and or regrow our industrial base to create jobs. Only a complete fool would take seriously these so called plans of Clinton, it was the Clintons who got the ball rolling with these "Free Trade Agreements. Bush just took these agreements to the extreme. Anybody who payed attention in their High School history class knows that Alexander Hamilton's tariffs built the industrial base and a great internal market that made this country economically independent and created jobs. THERE ARE NO JOBS AND NO FUTURE WITHOUT TARIFFS!

    Posted by P. J. Casey at 01/13/2008 @ 9:57pm

14. Posted by P. J. CASEY 01/13/2008 @ 9:57pm | ignore this person

    Keynesian economics will not be helpful, and has never been helpful, ever.

    "This means we must withdraw from the WTO, NAFTA, and other "Free Trade" Agreements."

    Which ipso facto means, a withdrawal from Keynesian economics.

    Posted by V at 01/14/2008 @ 12:54am

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    Posted by xz116926 at 01/14/2008 @ 01:42am

16. The corporatists are salivating with the prospect of obscene profit margins if a big "public works" program becomes law. The problem is that this program would likely not employ American citizens unless important safeguards are built into the legislation, which are not stripped out by executive branch orders.

    Recall our recent history post Hurricane Katrina. Large amounts of federal funds were released in late 2005, while at the same time, Davis-Bacon Act protections were suspended for recovery projects in and around New Orleans. One of the key Davis-Bacon Act provisions that employers demanded be lifted was the requirement that they verify that their workers were U.S. citizens. The result was that massive numbers of Mexican illegal aliens were employed there, while American citizens continued their unemployment and underemployment.

    Thus, if any economic stimulus is actually going to benefit the U.S. middle class, the common sense requirement of real - time verification of the worker's authority to work in the U.S. will have to be included - if the goal is to revive the U.S. economy!

    Posted by DrGeneNelson at 01/14/2008 @ 08:04am