It IS the Economy [UPDATED x2]

UPDATE x1: I added CK’s comment as a “scared shitless update” in the version at MyDD.

UPDATE x2: Do you think that Hillary is probably just a “latte liberal” wooing blue-collar votes? How about this from her Wikipedia bio: “That summer, she worked her way across Alaska, washing dishes in Mount McKinley National Park and sliming salmon in a fish processing cannery in Valdez (which fired her and shut down overnight when she complained about unhealthy conditions).” (I’m so proud of her for getting “canned”! Ha!)

Joshua Holland at Alternet has a great analytical article today on the Clinton/Obama economic plans here: “Hillary’s Economic Plan: Nothing Daring, But More Comprehensive Than Obama’s.”

The economy has so far been the most pressing issue in the minds of voters in both major parties, and this week Hillary Clinton unveiled a wide-ranging and thoughtful set of economic policies. You can read it in its entirety here (PDF). …

Economist Stephen Schlesinger (son of Arthur) has more at HuffingtonPost (”Senator Obama has come up with an alternative plan, which, by contrast, does none of these things but tinkers around the edges.”) — and I’m also covering Barack Obama’s highly misleading statements from “Sen. Obama Launches Inaccurate Attack On Hillary’s Plan To Curb Housing Crisis“:

Schlesinger:

Of extraordinary importance, she has taken the lead on the most important economic crisis to face our country in decades. She was among the first of the first Democratic contenders to propose a bold economic recovery program designed to rescue the nation from recession. Over a month ago, Senator Clinton advocated a $70 billion emergency spending and a back-up of a $40 billion tax rebate should economic conditions worsen. Hers is a direct attempt to help the most threatened people in America - namely, lower-income families facing foreclosures of their mortgages, those in need of home heating aid, the unemployed who require extended jobless benefits and funding for alternative energy and environmental programs. Her opponent, Senator Obama belatedly came out with his own plan a few days ago which seemingly lifts most of his ideas straight out of Senator Clinton’s proposal.

On a more specific level, Senator Clinton’s recommendations on helping Americans caught in the sub-prime mortgage mess are far-reaching. She has called for a moratorium on foreclosures, a freezing of interest rates, the use of federal subsidies to help homeowners keep up with payments and restructure loans, and augmented regulation of the financial industry. Senator Obama has come up with an alternative plan, which, by contrast, does none of these things but tinkers around the edges. He backs a bill against mortgage fraud, supports an average $500 tax credit for homeowners and endorses additional funding for a limited class of homeowners. This is a tepid response to an enormous tragedy.

In many ways, Senator Clinton is to the left of Senator Obama. Hillary Clinton has outlined a program of universal health insurance — meaning that every person in America would be covered. By contrast, Senator Obama’s plan is more restrictive and would leave 15 million people uncovered. Lastly, Hillary Clinton is a fighter for change. Senator Obama, on the other hand, is a self-described conciliator. What Democrats want today, however, is a battler, not a motivational speaker. They have suffered enough from the vicious blows of President Bush and the Republicans. What the party needs is a nominee who will take the contest directly to the opposition. Come the Fall showdown, a candidacy of “friendly persuasion” is going to be swiftboated into oblivion.

From “Sen. Obama Launches Inaccurate Attack On Hillary’s Plan To Curb Housing Crisis“:

Hillary has a plan to curb the foreclosure crisis by freezing rates on adjustable rate subprime loans. It was a policy also favored by Sen. Edwards. Barack Obama has no plan so he’s chosen to go on the attack. From his event in Texas today:

She’s proposed that we freeze the monthly rate on existing adjustable rate mortgages for at least five years. I disagree with that approach, although I’m sure it’s well-intentioned, and here’s why: it will reward people who made this problem worse. It will also reward people who are wealthy and don’t need it. It won’t just target the struggling home owners who need help the most. And on top of that, a blanket freeze as she’s proposed will drive rates through the roof on people who are trying to get new mortgages to buy or refinance a home. Experts say the value of homes will fall even more, and even more families could face foreclosure. That’s why one economic analyst called her plan “disastrous”.

His argument is false, and based on a flawed report in the New Republic that assumes Hillary’s plan applies to all adjustable rate mortgages and not just subprime adjustable rate mortgages. Subprime mortgages are overwhelmingly held by low-income individuals. Laura Tyson, professor of economics at the Hass School of Business at the University of California, Berkeley explained:

The rate freeze would give the housing market time to stabilize and would give mortgage servicers an opportunity to restructure unworkable mortgages and avoid unnecessary and costly foreclosures that harm both homeowners and investors. The rate freeze is critical because the 30 to 40 percent escalation in monthly payments is a major driver of defaults and ultimately foreclosures in the subprime mortgage market. Senator Clinton limits the proposed moratorium and rate freeze to subprime mortgages because the foreclosure crisis is disproportionately a subprime crisis. Subprime loans comprise less than 15 percent of all mortgages but more than 50 percent of foreclosures.

Thaler and Woodward are simply wrong when they describe the Senator’s proposed rate freeze as applying to all adjustable rate mortgages and not just subprime ones.

When corporations run into trouble meeting their obligations, creditors often arrange a “workout” that restructures the financial obligation by setting new payment terms, etc. Creditors don’t do this under force of law. They do it voluntarily because it keeps their clients in business and it limits their own losses. Senator Clinton is proposing that banks do for families what they already do for big business.

Jon Corzine, who in addition to being a governor is the former head of Goldman Sachs, has said the following about Senator Clinton’s plan: “I believe that her call for a 90-day moratorium on subprime foreclosures, a 5-year freeze in rates on subprime loans, and a $30 billion fund to help states fight foreclosures, is the right approach for tackling the mortgage crisis.“

Sen. Obama is positioning himself to the right of President Bush. The Bush administration recently reached an agreement with the mortgage industry to implement a limited foreclosure moratorium and a loan modification program that could result in rate freezes for at-risk borrowers. In December, the administration announced another plan that also called for a rate freeze for qualified at-risk homeowners. While this plan is not sufficient, it goes farther than Sen. Obama.

More on Hillary’s plan to curb the housing crisis HERE.

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I’m that rare person who never liked the phrase, “It’s the economy, stupid.” Besides, it was a campaign war room phrase that the 1992 Bill Clinton staffers put up on their office wall. It was a note to themselves to emphasize the economy. It was not intended to call anyone else stupid. But it always kind of seemed like that to me.

The American people know that the economy is in deep trouble. And I hope they get a chance to study the actual policies of the two candidates, and find out who’s the best on the economy and on NAFTA (another issue that Barack Obama has lied about, including that he supports “free trade”).

There’s my friend Cheryl’s story about losing her job and fearing she’ll lose her home, along with hundreds of her co-workers.

And there are comparisons of Edwards’, Clinton’s, and Obama’s plans by top economist here: “Edwards, Clinton & Obama: On Economics & Workers [UPDATED x2].”

I leave you with the script for the video, “Night Shift“:

[Announcer:] You pour coffee, fix hair, you work the night shift at the local hospital. You’re often overworked, underpaid, and sometimes overlooked.

But not by everyone.

One candidate has put forth an American family agenda to make things easier for everyone who works so hard.

Universal healthcare.

Increased daycare.

And help with elder health care.

She understands. She’s worked the night shift, too.

[HRC:] I’m Hillary Clinton and I approved this message.