Monday, November 10, 2008

China Takes Action. US Hangs Out

For the past few days since Barack Obama was elected President, I've been trying my best to keep up with the news about his presidential transition and the economy. Although it has only been a few days since the historic election, there has already been a lot of politics and fighting between the various interest groups in the US.

The main issue currently in the US is the economy. As GM is almost going bankrupt and more people hit the unemployment lines everyday, the country has sought a change from the current status quo and is looking to Obama as the savior. It seems that most people want him to start doing things right away and try to pursue his policy direction he laid out during his campaign.

Obama has announced his desire for middle class tax relief, help in healthcare and unemployment insurance for the poor as well as investments in infulstructure and public work projects all over the country to stimulate the economy. The issue right now is that:

1. He's still not the president. He only becomes president in January.
2. Even though he has a "mandate" from the election, he has to get past the lame-duck congress and lame duck president bush to see any of his proposals become law before he's sworn in.
3. Even when he is officially president, he will still have to play the politics game back and forth with congress to get anything done. As we've seen the $150 billion in amendments and pork addes on to the $700 billion bailout of Wall Street, there will definitely more of the same to any new stimulous package.

So in the midst of an economic crisis for the ages, the US government cant act because of procedural issues and infighting.

On the flip side, look at China. Just before I went to bed last night, CNN reported that China, in all its "red, commie" glory, has announced a $586 Billion spending plan for the next to years to bolster its economy in this downturn. Without too much debate or infighting, China has acted urgently to combat this crisis.

And surprise surpise, the investment is for "infrastructure and social welfare" projects/programs. I guess this is what Obama was thinking about doing in his plan. Now lets see how long it takes the US to do the same exact thing as China.

1 comment:

mish said...

I thought the exact same thing when I saw the China's announcement. China's doing *exactly* what the USA should be doing. I would tilt the investment toward clean energy infrastructure, and build fuel efficiency/research into any guarantee to the auto industry as well. As you were saying, though, it seems we'll have to wait 2 months before anything happens.