Question: How has Obama done so far?
Dean Baker: It’s a very mixed picture. I mean, he’s done some things that are very big, very important. The stimulus package got passed in his first month in office. That was important. It’s a big step towards combating the downturn. He’s gotten healthcare on the agenda. He has plans in his budget to start on healthcare and he’s worked with Congress to have it included in the reconciliation process which means the Republicans can’t filibuster it. He’s also put forward ambitious plans on energy, which is part of the stimulus. So he’s done a number of big, important things: extended employment benefits, changed the formulas so that a lot of people that had not been covered previously are now covered and provided healthcare benefits. People who are unemployed will have 65% of their healthcare benefit covered by the government, which makes it affordable for a lot of people that could not otherwise afford health insurance once they’ve lost their jobs. So a lot of good things.
Where I give him bad marks is his dealing with the financial system. We had a really big problem with finance run amok. That’s what got us here. That’s what led to the downturn and it has to be reined in and he doesn’t seem prepared, at least he hasn’t seemed prepared at this point, to really take the hard steps to rein in Wall Street. And what I worry is that we’re going to get out of this, one, costing the tax payers huge amounts of money because we’re looking at spending at least hundreds of billions, and quite possibly over a trillion dollars to bail out the banks. And, two, basically, leaving them in shape, leaving them as they were being prepared to run amok again. So, I think that would really be unfortunate. It’s a really big drain to the tax payers. It’s a huge amount of money. We’ve had big fights over sums that were less than a hundredth as large, and then on top of that, not to wrestle back the sector when it’s really crying out for serious regulation. It really has to be reined in. Wall Street has to serve the rest of the economy. When you have an economy that’s being run to serve the financial sector, you’re asking for trouble.
Recorded on: April 28 2009