A Reality Check On Obama's Wish List

U.S. News & World Report's Michael Barone Speculates On What An Obama Administration Would Look Like

(US News)  This analysis was written by U.S. News & World Report columnist Michael Barone.

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What will an Obama administration and a Congress with increased Democratic majorities do? That's a relevant question, given the Democrats' leads in the polls. And it's a little hard to answer, given the financial crisis that has been raging and the recession that seems to be ahead.

One thing they will certainly do is raise taxes on high earners. The Bush tax cuts are scheduled to expire in 2010, and congressional Democrats will gleefully allow the top rates to rise. Left-leaning Democrats, like Barack Obama himself, want to "spread the wealth around," as the candidate told Joe the Plumber in October. Blue Dog Democrats want to reduce the budget deficit and will welcome the additional revenue that the Congressional Budget Office's static-analysis models will promise. Raising taxes when the economy is weakening is not the medicine prescribed by Keynesian economics, and it is probably not what Obama's economic advisers would prescribe if they were starting from scratch today. It is what Herbert Hoover and Congress did in the early 1930s, and it helped to produce the Great Depression. But it is baked into the pie.

So is a slide toward trade protectionism. The breakdown of the Doha Round and House Speaker Nancy Pelosi's refusal to bring the Colombia Free Trade Agreement to a vote mean that both multilateral and bilateral trade liberalism channels are clogged. Obama may or may not try to renegotiate NAFTA, as both Canada and Mexico have center-right governments satisfied with current arrangements. But the trend will be toward less free trade.

The prospects are cloudier for two other issues on which Obama has made big promises. Much of the next Congress's time and psychic energy will be taken up with refashioning financial regulation--a subject of considerable difficulty. And the looming recession will make it politically risky for Democrats to push big spending programs.

This means that Congress in the next two years may not pass Obama's national health insurance plan. The weakening economy and the enraged reaction earlier this year to $4-a-gallon gasoline also make it less likely that Congress will pass carbon reduction legislation--certainly not a carbon tax and probably not a cap-and-trade system.

Regional impact. In any case, health insurance and carbon reduction will be heavily lobbied, despite all the denunciations of lobbyists issued by Obama (and John McCain). Any one-size-fits-all healthcare bill affects various regions differently, because we have many healthcare delivery and finance systems across the country. The same goes for carbon reduction legislation, as the economies of some regions depend more heavily on coal than do others; it may be hard to convince voters there that we have to impose burdens on them today to achieve promised benefits in 2050. These disparities cut across party lines and helped defeat the Clinton healthcare proposals in 1994. They will probably come into play again if far-ranging bills are pressed forward.

Two issues pushed by Democrats in this Congress have no budgetary costs. One is the "fairness doctrine," which is intended to shut down talk radio, the one communications medium in which conservative voices are dominant. The other is the so-called card check bill, which requires employers to bargain with unions when their organizers secure signatures on cards from a majority of employees; secret-ballot unionization elections, required now, would be a thing of the past. The aim is to vastly increase union membership, pumping money into a Democratic pressure group.

What might happen in the unlikely event McCain is elected and faces a Democratic Congress? Presumably he would try to hold tax rates down, but to do so he might have to embrace the kind of bipartisan tax reform enacted in 1986, with low rates and fewer preferences. Democrats might be willing to bargain if they could get rid of the alternative minimum tax, which threatens their core constituencies. McCain's plan to end the tax preference for employer-provided health insurance could be the basis of compromise with a similar plan advanced by Democratic Sen. Ron Wyden that has bipartisan support. McCain might also seek a bipartisan carbon reduction bill.

Much depends, whoever wins, on whether Democrats elect enough senators to overcome filibusters. Even more may ride on the course of the economy and the depth of the recession, which could scotch either candidate's proposals.

[pdchapin]

Most small business owners I''''''''ve talked to plan on cutting workers to make up for the increase in taxes. Not sure everyone''''''''s thought that scenario through??
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Intelligent hiring decisions are based on demand for the good or service. If a new hire can be put to profitable use, i.e., they generate more income than they cost, you hire them. If they can''t you don''t. The tax rate on the profit doesn''t impact the basic equation. Remember, taxes are on profits, not revenue. Higher taxes lower the profit, but it''s still a profit.

[messiahx4eve]

Hey Pitchoun1, would KING (CURIOUS/FURIOUS) GEORGE or EMPEROR BUSH(WACKER) work better for you? Perhaps a lifetime of DARTH CHENEY or FIELDMARSHALL CHENEY would suit you better? Obama is NOT referred to by any nation as the MESSIAH, more of that krappy neocon-propaganda from the sponsors of McSAME mccain & FAILIN'' palin. Reducing your politics to outright lies shows more glints of racism than any other tactics I''ve seen so far. No one is ever going to be "ready" for the presidency of this country, its a job that has no defined or clearcut probabilities, you have to have the smarts to politically converse, objectively see the other point of view, honed critical thinking skills and the guts to LISTEN to your constitutients and your own conscience, all of which neither bush or cheney have an abundance of EITHER. We teach our children to not lie to us, to be honest, and that if you can''t say anything nice, to not say anything at all. How many of the TEN COMMANDMENTS has politcal advertising broken? Half and half? all but ONE? You decide because on Nov. 4th this year, I am voting for change, REAL change, not the same H*E*L*L we have been running to because of the present administration. Hey Mr. bush, think that out of sight means out of mind? Think again, if you can think at all.

[ausus-2009]

mitch6544,

What Canada are you talking about? The universities charge and have scholarships like the US. If you don''t want to wait several hours for an emergency or months to years for and operation, you must pay or go over the border. For this they get the privilege of paying higher taxes and paying much more for gasoline.

[pitchoun1]

The Messiah

Obama is called the Messiah in arab countries

WAKE UP AMERICA !

[G H M]

A Reality Check On McCain''s Wish List
A study from scholars at Columbia, Harvard, Purdue and Michigan projects that 20 million Americans who have employment-based health insurance would lose it under the McCain plan%u2026 The McCain health plan would treat employer-paid health benefits as income that employees would have to pay taxes on.
%u201CThe McCain plan will force millions of Americans into the weakest segment of the private insurance system %u2014 where cost-sharing is high, covered services are limited and people will lose access to benefits they have now.%u201D The whole idea of the McCain plan is to get families out of employer-paid health coverage and into the health insurance marketplace, where naked competition is supposed to take care of all ills. Taxing employer-paid health benefits is the first step in this transition, the equivalent of injecting poison into the system. When younger, healthier workers start seeing additional taxes taken out of their paychecks, some (perhaps many) will opt out of the employer-based plans %u2014 either to buy cheaper insurance on their own or to go without coverage. That will leave employers with a pool of older, less healthy workers to cover. That coverage will necessarily be more expensive, which will encourage more and more employers to give up on the idea of providing coverage at all.

[gotravel1]

To see how Obama''s economic plan compares with other nations,watch http://windsofchange.thruhere.net Other nations are realizing that their tax policies and socialistic programs have destroyed their economies and are changing to more conservative approaches.Why would Obama want to take American down a failed path?Too much of American business is foreigned owned,and Obama''s policies would cause business owners tighter their belts by laying off workers,raising prices or moving overseas.Obama,bad for business,bad for America! We don''t need his radical agenda.Even most Democrats would have to agree that his policies are too liberal and too dangerous for America.Try to find a more moderate candidate next time! Vote for McCain,a moderate Republican who has a history of bucking with his own party and has NEVER pushed for earmarks.I believe that with the support of the American people,he will get us back on track.

[danielle_mom]

As business owners, we try to give our employees perks. If obama''s plan come to fruition, we will be either raising our prices or asking our employees to contribute more to their benefits. Either way, it does not look good.

[mitch5511]

Since when is socialism equals communism? You all need to get a grip on reality. Look at Canada, UK, France, Netherlands, etc. Are they communistic countries because they embrace socialistic causes like universal health care and college education for all?

Sometimes I think people in the US are downright stupid!

[rickwar]

Barry H Obama + George Bush to ()- Jimmy Carter =

The biggest bunch of fools, idoits, morons, economy destroying, and not fit to hold office.

John McCain is not far behind these people, and should not even have been concidered by the GOP for the Elect Presidential spot, but the media picked our GOP Prez for us.

The media is manipulating the election in every way thanks liberals

Vote your pocket book, who is less likely too affect your life in four years, or the redistribution of the wealth, to take your money you earned and give it away to another person less willing to work as hard as you, or another country.

Please, please don''''''''t be fooled by either these two fools running, or liberal media bias.




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Posted by KathySun at 06:25 AM : Oct 29, 2008

SOS Different day.

[rickwar]

Most small business owners I''''ve talked to plan on cutting workers to make up for the increase in taxes. Not sure everyone''''s thought that scenario through??


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Posted by bizdev2001 at 10:27 AM : Oct 29, 2008

Haven''t talked to me, I''m actually looking at an additional location and increasing the number of employees

[markangeloo]

Mark the Painter cut workers 3 years ago
realizing the coming Bush disaster.
I am preparing to hire now that we have reached the bottom & Barack is taking us on his way up.

Oh KathySun U want to spread the wealth to the
worthless old Rust Belt & think that is not socialism.

[bizdev2001]

Most small business owners I''ve talked to plan on cutting workers to make up for the increase in taxes. Not sure everyone''s thought that scenario through??

[Gary Kempf]

KathySun

You really need get back on your meds.

[arnie452]

The theme of what Obama is trying to get people to believe is "You have less because someone else (the rich) have more."
He is trying to appeal to a wide audience (95%) by saying that they will be better off with him as President as they will get a tax cut while he will make the top 5% pay for it all.
Of course the truth is this is not mathematically or practically feasible.

In doing this Obama is promoting a sentiment of envy and covetness among people, and not "bringing us together" as he preaches. Instead of us looking at successful people and being appreciative of their efforts, or inspired by them, Obama wants us to see them as undeserving of the wealth most of them have worked very hard for and feel we are deserving of their money and entitled to it without any extra effort on our part.

[ausus-2009]

My greatest concern as a long-time editor is the fairness doctrine, something I see as a violation of the First Amendment. It can be used to ensure that the media puts forward only pro-administration views. While I don''t take Fox News seriously, I would not have it shut down by government decree any more than I would want to see left-wing media shut down.

To quote one former Kennedy Administration official, Bill Ruder, "We had a massive strategy to use the fairness doctrine to challenge and harass the right-wing broadcasters, and hope the challenge would be so costly to them that they would be inhibited and decide it was too expensive to continue."

Scary stuff.

[rcal13]

No the truth is that Obama can not do the thing he has said and if he tries then the incress spending and taxes will destroy our weaken economy. He has a great record of saying what poeple want to hear not what the truth is.

[dburfears]

Wow - McCain good. Obama Bad.

This article is a slanted piece of fictional writing.

[dude1961-2009]

VOTE YES - JOHN McCAIN & SARAH PALINE - VOTE YES

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PRO GUN RIGHTS - "Believes gun laws do not reduce crime"

LOW TAXES FOR EVERYONE - "do not raise taxes on anyone"

PRO AMERICAN VALUES - supports the present Constitution. Does not believe it is ''flawed'' like Mr.Government does.

PRACTICES SOUND GOVERNANCE - he has never asked for Earmarks (Pork) in 26 years.

PEOPLE DRIVEN HEALTH CARE - supports private health care not run by the Government
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VOTE YES - JOHN McCain & SARAH PALIN - VOTE YES

[dude1961-2009]

VOTE NO - OBAMA IS A BAD CANDIDATE - VOTE NO
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Obama wants GOVERNMENT RUN Health Care
Obama has a 100% ANT-GUN voting record
Obama has a 100% Pro-PORK spending record
Obama thinks ''LIFE IS ABOVE HIS PAY GRADE''
Obama WILL TAKE FROM YOU
Obama WILL GIVE TO SOMEONE ELSE
Obama WILL INCREASE GOVERNMENT IN YOUR LIVES
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VOTE NO - Mr Government OBAMA - VOTE NO

[samthetvcat]

---"The 168 Billion they paid out in the last stimulus pkg that did nothing at all for our economy would have gone a long way toward getting us started on the road to energy impendence."---
Posted by beyondgreen

Wow that''s so true - I guess your larger point is that like Congress for whatever reason seems to have a tendency to think short-term so they end up paying trillions for what could have ultimately only costed like mere tens of billions if they had taken a longer-term view (?)

Yeah, there does seem to maybe be a danger of Congress if they feel like it''s an either/or between more stimulus checks and an investment in alternative energy that won''t pay off for decades to go for the flash.

Maybe that''s what they''ll put off instead of healthcare (?)