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What I Learned From Last Night’s Debate

October 8th, 2008 . by economistmom

I was going to post lots of excerpts from the debate transcript that proved what wasn’t news to me in last night’s debate–in other words, quotes that support my post from yesterday, that McCain’s economic platform hasn’t budged an inch.  But that wouldn’t be very interesting, as the words were hardly different from those we’ve heard before.

At the same time, I must acknowledge that Obama’s economic platform hasn’t really budged either.  I think what’s really changed with the economic crisis is that Obama’s general approach to the economy just makes a lot more sense relative to McCain’s right now.  (What’s changed is the backdrop, not the platform.)  And the other “silver lining” in this crisis (besides the biggie of everyone starting to realize the problem in our living beyond our means) is that the whole country seems to be paying a lot more attention to the real economic issues now.

What was news to me in last night’s debate was that they both apparently consider Obama-supporter Warren Buffett a leading candidate for Treasury Secretary (emphasis added):

Brokaw: …Obviously the powers of the treasury secretary have been greatly expanded. The most powerful officer in the cabinet now. Hank Paulson says he won’t stay on. Who do you have in mind to appoint to that very important post?

Sen. McCain?

McCain: Not you, Tom.

Brokaw: No, with good reason.

McCain: You know, that’s a tough question and there’s a lot of qualified Americans. But I think the first criteria, Tom, would have to be somebody who immediately Americans identify with, immediately say, we can trust that individual.

A supporter of Sen. Obama’s is Warren Buffett [chairman of Berkshire Hathaway]. He has already weighed in and helped stabilize some of the difficulties in the markets and with companies and corporations, institutions today.

I like Meg Whitman [former CEO of eBay and current McCain campaign adviser], she knows what it’s like to be out there in the marketplace. She knows how to create jobs. Meg Whitman was CEO of a company that started with 12 people and is now 1.3 million people in America make their living off eBay. Maybe somebody here has done a little business with them.

But the point is it’s going to have to be somebody who inspires trust and confidence. Because the problem in America today to a large extent, Tom, is that we don’t have trust and confidence in our institutions because of the corruption on Wall Street and the greed and excess and the cronyism in Washington, D.C.

Brokaw: All right. Sen. McCain — Sen. Obama, who do you have in mind for treasury secretary?

Obama: Well, Warren would be a pretty good choice — Warren Buffett, and I’m pleased to have his support. But there are other folks out there. The key is making sure that the next treasury secretary understands that it’s not enough just to help those at the top.

Prosperity is not just going to trickle down. We’ve got to help the middle class…

So I have two questions: 

  1. Had Senator McCain heard that eBay, the former company of his apparent #2(?) choice for Treasury Secretary, had just announced a cut of 1,000 jobs (10% of its global workforce)?  and…
  2. Does Senator McCain’s first recommendation of (Obama supporter) Warren Buffett for the next Treasury Secretary perhaps signal that Senator McCain (himself) believes Senator Obama will win the election?

By the way…why do I not count McCain’s “new proposal” to “order the Secretary of the Treasury to immediately buy up the bad home loan mortgages in America and renegotiate” (a plan McCain said would be “expensive”) as evidence of a shift in his platform?  Because it’s so totally inconsistent with the rest of McCain’s economic philosophy, and reminds me so much of his proposal earlier this year for a gas tax holiday, that I can only conclude that the motivation and the level of thought that went into this “new proposal” are about the same.  I haven’t read what others have said about this (second) surprise in last night’s debate, so I wonder…  Is anyone taking it seriously–including McCain’s own economic advisors? 

***UPDATE (10/9):  Today the Washington Post has an editorial and an article on the subject of McCain’s new mortgage proposal.  So they’re taking it seriously enough to write about it.

One Response to “What I Learned From Last Night’s Debate”

  1. comment number 1 by: B Davis

    Had Senator McCain heard that eBay, the former company of his apparent #2(?) choice for Treasury Secretary, had just announced a cut of 1,000 jobs (10% of its global workforce)? and…

    I did wonder about this. I think he’s mentioned Meg Whitman before so maybe he hadn’t prepared for the Treasury Secretary question.

    Does Senator McCain’s first recommendation of (Obama supporter) Warren Buffett for the next Treasury Secretary perhaps signal that Senator McCain (himself) believes Senator Obama will win the election?

    I don’t know but I really do wonder how feasible this is. Buffett is actively running Berkshire Hathaway at this point and it would seem that being Treasury Secretary would be a full-time job, especially now. It would seem more likely that Buffett might continue to serve in various advisory roles.

    I haven’t read what others have said about this (second) surprise in last night’s debate, so I wonder… Is anyone taking it seriously–including McCain’s own economic advisors?

    I must admit that I missed that this was a “new proposal” during the debate and didn’t catch it until it was mentioned during the analysis. It doesn’t seem like a two-minute answer is the best time to bring out a new proposal. In any case, I noticed a few other things in the debate. For one, McCain made the following curious statement:

    My friends, we are not going to be able to provide the same benefit for present-day workers that we are going — that present-day retirees have today. We’re going to have to sit down across the table, Republican and Democrat, as we did in 1983 between Ronald Reagan and Tip O’Neill.

    To my knowledge, the problem is that we can likely not provide benefits for present-day workers that are as improved over present-day retirees as is currently promised. Initial benefits are indexed to wages which tends to grow faster than inflation and retirements will get longer and longer if the full retirement age remains at 67. Hence, real benefits are scheduled to increase and retirements are scheduled to lengthen. This may need to be moderated. However, I don’t believe that anyone is suggesting that overall real benefits will need to decrease.

    Another of McCain’s comments that I took note of was the following:

    The point is — the point is that we can fix our economy. Americans’ workers are the best in the world. They’re the fundamental aspect of America’s economy.

    They’re the most innovative. They’re the best — they’re most — have best — we’re the best exporters. We’re the best importers. They’re most effective. They are the best workers in the world.

    As far as being the “best exporters” and “best importers”, I assume that McCain just means the biggest. And if we are truly the “best workers”, why do we buy so many products made by “inferior workers”? In any case, it would seem that Americans can be patriotic without insisting that we are the best workers. One might say that our workers, given the proper training and tools, are second to none. But I don’t see the point in claiming superiority. This claim, which I have heard McCain make before, seems like simple pandering.