In his campaign, Obama’s plans to improve the economic condition of the US were certainly admirable and well thought out. His strategy was basically oriented towards the middle class (which have suffered the most due to the meltdown) and it was also an approach to give a boost to the now doomed businessmen and the new players who want to enter the industry. Looking at the recent monetary crisis, he, along with Biden, came up with fresh new pointers in his election campaign which can help improve the situation.
In his agenda, his first objective had been to cut down taxes imposed on the working middle class. This provides relief to almost 95 per cent of working citizens. Obama – Biden team also promised to create a new “Making Work Pay” tax credit of up to $500 per person, or $1,000 per working family. That will really be a big relief, considering the fact that taxes cut down the benefit a consumer gets in a market. The US, being a capitalist economy, must care for its consumers.
Their second objective was about giving a boost to the now falling economy. They seek to provide $50 billion to jumpstart the economy and prevent 1 Million Americans from losing their jobs. This relief is to include a $25 billion State Growth Fund to prevent state and local cuts in health, education, housing, and heating assistance or counterproductive increases in property taxes, tolls or fees. The Obama-Biden relief plan will also include $25 billion in a Jobs and Growth Fund to prevent cutbacks in road and bridge maintenance and fund school repair – all to save more than 1 million jobs in danger of being cut. This is one other reason why his party got maximum votes; the common person had faith in this man. This can be seen by the donations he got for campaigning – just 5-6 dollars by many Americans built him a big enough fund to reach out to everyone.
Thus, it is easily evident that the concern here is the genral public and not the rich capitalist societies of the US. Economically, it is true that levying a tax on the rich doesn’t affect them much. For example, if a tax is levied on the purchase of diamonds or other similar luxorious item, a rich man can easily choose not to buy it and go for a commodity like platinum. Hence the burden here is shared very less by the consumers (the rich men) than the producers. Now if a tax is levied on the commodities consumed by the middle and poor classes, it is the general public that suffers. If there is a tax on potatoes (considering it to be in the staple diet), then every person buying potatoes has to pay a tax. Inflation and price rise also does not improve the situation. Hence thinking for the middle class was definitely smarter a move, than promoting capitalism.
Their third objective was to promote fair trade. They promise to work for a trade policy that can open up foreign markets to support good American jobs. They will also use trade agreements to spread good labour and environmental standards around the world.
All in all, Obama’s policies for campaign worked for equity rather than efficiency, which in the end, is the need of the hour in such a financial crisis in the US. I personally felt that by these policies, Obama not only proved himself to be a good Politician-Economist, but also a concerned citizen – something that our Indian Political leaders must learn. Now it remains to be seen how many promises he is able to deliver.
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