Hillary's Economic Plan: Nothing Daring, But More Comprehensive Than Obama's

In the midst of a heated primary battle in which all of the minutia of a modern campaign is dissected and analyzed ad nauseum and substance is all-too-often treated as an afterthought, it's easy to lose sight of the candidates' positions. That's unfortunate; the country is facing severe problems, and ultimately this election is about who's best prepared to tackle them.

That's not to say that a candidate's style, perceived electability or approach to problem-solving aren't legitimate issues for voters to consider, it's just that an exclusive focus on those "intangibles" gives primary voters an incomplete picture.

The economy has so far been the most pressing issue in the minds of voters in both major parties, and this week Hillary Clinton unveiled a wide-ranging and thoughtful set of economic policies. You can read it in its entirety here (PDF).

Here are the highlights:

The lending crisis

The good:

Clinton would establish a $30 billion fund to aid states and municipalities in dealing with the effects of a sharp spike in foreclosures:

[The] fund will support initiatives by states, cities and community groups to reduce foreclosures and to help cities cope with the financial and social costs associated with an increase in vacant properties. States are already piloting programs to stem foreclosures. Many of the programs provide financial counseling to at-risk homeowners, help borrowers work out solutions with lenders, help homeowners become current in their payments, help families refinance unworkable mortgages and educate homeowners about predatory lending.

Her plan would also aid millions of families with a subprime loan on the bubble, providing:

• A 90-day moratorium on subprime foreclosures (for owner-occupied homes), to give homeowners and lenders a chance to work out new loan schedules.
• A five-year freeze on upward mortgage rate adjustments. Most subprime mortgages have adjustable rates, and this measure would provide an incentive for lenders to offer homeowners a conversion to fixed-rate loans

The not-so-good:

Clinton's focus on subprime loans is important, especially as low-income, minority and single-parent households are disproportionately affected. But the reality is that we face a banking deregulation crisis, and subprime loans are simply a symptom of much larger problems. Prime "option ARM" mortgages -- adjustable rate loans -- are the next to go, and programs that only address subprime lending are going to pass over a lot of middle-class households with negative equity in their homes.

Her husband's administration, with its unquestioned fealty to neoliberalism, shares much of the blame for creating the conditions that led to the current crisis, and while Hillary's plan offers a few words about improving America's regulatory framework, she stops short of proposing significant reregulation of the financial industry.

She also hedges her bet in "calling on Wall Street" to do these things voluntarily -- no mention of forcing them to do so through hard-edged legislation. Wall Street, in general, does not do the right thing of its own volition, so the question becomes whether such a program can be sold to the financial community as a matter of their own self-interest.

Kick-starting the economy

Clinton endorses the economic stimulus package passed by the House, but agrees with most analysts who view it as incomplete and skewed towards helping investors rather than workers. She would improve the stimulus package by:

• "Extending and broadening" unemployment coverage for workers who are out of a job.
• Providing an average of $650 in emergency home-heating assistance to each of the 37 million families that she says are in need.
• "Making immediate investments to jump-start green-collar job growth, including a program to weatherize homes, retrofit public buildings and train green-collar workers."