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It’s difficult to hold your ground during an earthquake.  And the economic earth has been shifting, fast and furiously, during a week from hell.  If we could link the financial meltdown we just experienced to Al Qaeda, we’d be invoking the Bush Doctrine and preparing to invade some country with ties, however tenuous, to this continuing nemesis.  But this crisis, which may cost American taxpayers more in a month than the Iraq war has cost us in five years, appears to be completely homegrown.  So to quote that great political commentator, Pogo, "we have met the enemy, and they are us."

Before the financial meltdown began, I posted a blog that evaluated the candidates’ economic philosophies in the light of their health care reform proposals.  I did this in part because health policy is my particular area of expertise and in part because when candidates focus on health care reform, they often neglect to employ many of the sleights of hand that make political discussions of economic policy so unrevealing.  What does John McCain mean when he promises us just the right amount of regulation?  What does Barack Obama mean when he says he respects the innovative power of the free market?  Perhaps the best answer to these questions can be found in John McCain’s own presentation of his health care reform package in the Sept/Oct 2008 issue of Contingencies and in Obama’s healthcare plan as presented on his website.

John McCain has spent much of the past week trying to find the villains behind the collapse of our financial markets.  What he can’t seem to grasp is that environmental factors can turn honorable people into criminals and people of questionable morality into models of probity.  Shade the truth just a bit, do this over and over again, and the possibility of weapons of mass destruction becomes a certainty.  Create financial instruments that no one really understands, add a little more risk with each derivative, and all of a sudden you’ve inoculated the entire financial system with a virulent strain of almost worthless paper.  But John McCain is as wedded to his mistaken notion of free market economics as George Bush is to his war in Iraq.  Out of political necessity, Senator McCain may try to sound like he understands the need for government referees at a free market football game, but in the end he simply can’t surrender his favorite theory to some stubborn little facts.

In McCain’s own words just released in Contingencies:

"Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation.  Consumer-friendly insurance policies will be more available and affordable when there is greater competition among insurers on a level playing field."

I don’t know about you but I become very uneasy when someone promises to do to my health insurance what was done to our financial markets.  I’m certainly as patriotic as the next guy when it comes to paying taxes to support our troops and underwrite useful government services.  However, I become irate when a candidate promises me tax cuts but supports health reform packages that will decrease take home pay by taxing employer-based health insurance premiums and advocates deregulation that must either raise taxes or leave my children with a mountain of federal debt when our incompetent government is forced to clean up after the Wonderful Wizards of Wall Street.

In contrast to Senator McCain’s belligerence as his deregulated chickens come home to roost, Senator Obama has laid out a plan to correct past errors in market management once the crisis has past but has recognized that this is a national crisis that requires bipartisan action, not political posturing.  Like his carefully crafted evolutionary approach to health care reform that conservatively works to preserve what is good in our current system while progressively repairing what does not serve us well, Obama’s response to our current economic crisis has been carefully modulated to support constructive responses even when they originate on the other side of the aisle.  

In 1929, President Hoover expressed the belief that American business was essentially sound and waited for the free market to correct itself.  By the time Roosevelt became President in 1932, the infection that started in the nation’s financial markets had spread to the entire economy and it took a world war to restore the American economy to its full potential.  Like Senator Obama, President Bush, his economic advisors, and the Democratic Congress appear to understand that the toxins must be removed from our financial bloodstream before the entire economy is compromised.  In contrast, John McCain and his running mate still are railing against bailouts.  I guess sometimes one behaves like a maverick simply because one does not understand the situation.

Watching John McCain flail away as he tries to deal with economic issues that appear to be beyond his grasp, I feel like the boy who approached Shoeless Joe Jackson after the Black Sox scandal and said: "Say it ain’t so, Joe?"  Unfortunately, in John McCain’s case as in Shoeless Joe’s, I fear it is.

Originally posted to Quality Counts on Sat Sep 20, 2008 at 04:25 PM PDT.

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