Barrack Obama will be sworn in as the 44th President of the USA on January 20th 2009. He now has 77 days to prepare his team, and his plans, so he can begin his term running on all cylinders to face the issues of the day, which are many and urgent.
The Bush US$700B bailout has singularly failed, in that the banks have not loosened credit, making it impossible for businesses to borrow for working capital, even if investment in plant is deferred. In accounting terms, it has only strengthened the balance sheets, so the banks do not look insolvent, but it has not helped the economy at all. An immediate 90 moratorium on foreclosures should be put in place without delay, so homeowners can negotiate terms. In reality in this crisis, it is better to keep a person in a home, than put them on the street, and lock the doors behind them. The bank will not be able to sell the house, so it is better to revalue the home downwards and structure a 100% loan on the new value at a slight premium in rates. This would prevent a glut of empty homes overhanging the market.
To jump start the dead construction industry, federal subsidies or tax credits, should be given to homes installing solar and wind energy, along with funds for research in developing new and more cost effective alternative energy systems for homes. This will form part of the green jobs package that has been promised. The same should also be done for electric cars.
The promised tax cuts cannot be financed at this stage, so it should only be limited to a tax credit for all before the rates themselves are dropped. A flat credit is more equitable than one depending on your income. This credit the same for all, say $1000 can be given to those not paying tax right through to the billionaire. Here there is relief for everyone, not just 95% of the returnees.
The proposals on Universal Health Care for all, should be laid out without delay allowing time for those controversial aspects to be discussed and consensus formed on how to practically get to the desired goal; namely of every person living in the USA being covered under one or other of the plans proposed. The environmental issues also need to be addressed with incentives to reduce the garbage piles put in place in this period, to start the ball rolling as it were. More research into recyclable materials should also be funded, to achieve the objectives.
The Foreign Policy agenda will be tricky. It is not easy, and it has nothing to do with Obama’s lack of experience. Of course each country will have a specific policy plan and engagement plan to suit their unique needs. One war will have to have a finite term, with Iraq footing at least 50% of the cost of troop commitments from January 2010. This will force them to get their forces ready to defend their country against agitators and insurgents.
The Afghan war however will have to be intensified and the Pakistan government engaged in the seriousness of their restless Northwest Frontier Province not taking the terrorist threat as anything more than an irritant. The increasing poppy fields that finance the insurgency in Afghanistan, have to be eradicated along with provision of alternative employment and income generation activities for the populace. This is a gigantic task not to be taken lightly as these people just cannot be tamed, so an accommodation, that delivers all hardcore, Taliban and Al Qaeda to the US forces, while respecting the territorial integrity of the country has to be negotiated.
Different courses of action are required to deal with the specific agendas of both Russia which is trying to exert pressure by regaining some lost power and prestige, while China is trying to prevent the closure of its factories due to the economic upheavals, by keeping its currency unusually low are issues that require diplomatic resolution by experienced officials.
The sore that is the Israeli question can be resolved by Obama, where all other previous presidents failed. He can command the respect of the Arabs, forcing them to agree on reigning in terrorism, in return for the insistence of Israel returning to its 1967 borders. There is no other way to resolve this issue and no matter what anyone says, that is the only way the state of Israel can exist in peace, and the century of Jewish resettlement be resolved once and for all. It is a once in a lifetime chance and I hope Obama realizes this and is up to the challenge especially taking the Israel lobby head on forcing them into a position of accommodating a fully fledged Palestinian State on an equal footing with Israel and aid to restore the country to one of respect and integrity with their own airports and power supply as well as the repatriation and employment of all their displaced people from camps in neighboring counties.
A much closer relationship with the worlds largest democracy, namely India is long overdue and I hope the Obama legacy will include a very close trade relationship with India that will be the engine that runs a future USA.