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A Potent and Populist Economic Issue for Obama?

On Monday, Barack Obama, fresh off his triumphant overseas trip to Afghanistan, Iraq, Israel, and Europe, turned to the homeland's number-one concern: the faltering economy. He was in Washington to hold a meeting with his top economic advisers. Here's how his campaign described what would happen:

Senator Obama will be joined by leading figures from business and labor, Democrats and Republicans to talk about the recent developments in the economy: job loss, financial markets, and the rising costs of oil, food and other commodities....Participants of the early afternoon meeting include: Warren Buffett, Former Chairman of the Federal Reserve Paul Volcker, Former Treasury Secretary Robert Rubin, AFL-CIO President John Sweeney, SEIU Secretary-Treasurer Anna Burger, Google Chairman and CEO Eric Schmidt and other economic leaders.

Most of the agenda is pretty obvious. And campaigns are supposed to do the obvious. But there's one economic issue that Obama ought to consider raising with these economic leaders and with the voters: transparency. So much of the economy now takes place in dark corners, where traders and speculators develop, buy and sell financial instruments that are unregulated and, perhaps worse, barely understood, except by the small number of players who trade them. This is partly what brought on the subprime meltdown. (See my description of swaps here.) Even former Treasury Secretary Robert Rubin did not understand the financial products that led to the housing credit crisis.

So here's a populist issue for Obama: the U.S. economy is too important to be placed in the hands of wheeler-dealers who in the shadows engage in transactions that have the potential to send waves of harm throughout the highly-interconnected financial world. Americans are entitled to feel insecure when they see that the economy can be so severely affected by a few big firms that go off the reservation, thanks to the imaginative machinations of a small number of traders. More transparency, more regulation--whatever the policy prescriptions are (and they will be technical and hard for most of us to understand), Obama could by addressing this issue gain a political advantage over John McCain, who tends to celebrate the workings of the markets.

These days there is very good reason for commoners to be suspicious of the markets. If Obama can speak to that, it could make for good policy and good politics.

Comments

I hate to break it to the Unions, but they are part of he problem.

I have seen UAW workers asleep at control boards for auto lines (Visteon alternator plant in Yipsi). The stories I have heard about drunk workers are too many to number (GM truck plant in Fort Wayne and Navistar plants in Ohio). And on top of it, getting paid $50K + incredible benefits for picking up a 5lb part, putting it into a machine and unloading it is just crazy (GE Fort Wayne). I have ben told by engineers at GE in Kentucky that their $50k per year workers with 20 ears experience are half as productive as the plant in Mexico.

At Harley in Mil, these guys are crazy. Our machine had a computer screen only used for diagnostics. This screen would go blank, but the machine would still run fine. The operator would shut the machine down then call for maintenance. Maintenance would hit the e-stop and restart the machine (no different from what you do when Windows crashes). Then, he fat, lazy pick would go back to work - 2 hours later!!!

Yea - too many jobs have been exported. But the unions are impossible to deal with and their demands are far from reasonable.

Posted by: motoman on 07/28/08 at 7:57 AM Respond

Unions part of the problem? What is your job at Harley, buddy? I've watched plenty of white collar workers piss away hours and money over many years.

I've been in almost 10 union shops, and don't recall anyone EVER sleeping. What I recall is intense work for 8 hours, with two 15 breaks and a half hour lunch. Unionized labor, by statistic, is more productive and more trained than any number of non-union shops. Even sweat shops in a Maquiladora, which you seem to 'adore.' These statistics weigh far more than the fact you saw someone sleeping once, or following union work rules.

You don't think physical labor is worth $50,000 a year? Wait till your body is used up at that job, then you'll see the price you pay for physical work. You arrogant bastard.

Posted by: Elydog on 07/28/08 at 9:25 AM Respond

Hey Elydog,

I'm not a union member, but I agree with you whole-heartedly. $50,000/year is not exactly a luxurious income. And "incredible benefits"? I'll tell you who gets "incredible benefits"; government workers! At the tax-payers expense! And you know who else gets "incredible benefits"? The guys running those unionized auto plants. And $50,000/year is peanuts to them. More like $50,000/month, or even per week at a higher level.

But yeah, it's probably those greedy unions that are to blame for our problems.

Posted by: DaveD on 07/29/08 at 4:27 AM Respond

First, the responsibility for disciplining an employee belongs to management - not the union. If you saw a union employee sleeping - blame the plant's managers, they are the only ones with the legal authority to do something about it.

Sounds to me as thought the employee who was most at fault in your little "diagnostic screen" story was the one that couldn't get the diagnostic screen to work right in the first place. If that union worker is to be held accountable for the quality of his process, you can't expect him to work without the appropriate tools.

Posted by: Nancy on 08/01/08 at 8:51 AM Respond