Saturday, October 18, 2008

Obama's plan vs. McCain's plan vs India - Part 1

Sitting back here in India, I watch with careful trepidation, the presidential race between Barack Obama-Joe Biden and John McCain-Sarah Palin. For all the criticism of both sides ranging from race, intelligence quotients, partnerships, political and economic stands, even religious leanings [??], it is funny to note that, wherever you may roam, politics will be politics!!

Now I would be out of my league to comment on which side would be best for America. I do hope that my American friends have the good sense to analyse and make that choice for themselves. However, what I can comment on is a very selfish issue, that of which side is best for India. After all, with a large portion of my work coming from the United States of America, quite frankly, the US presidential election is indeed, my business as well.

One of the best things that I find about the US Presidential race is the massive use of the internet that the candidates make. Everything from economic plans, advertisements, even merchandise is on the net!! And it makes a good starting point for a non-American citizen of the World like myself, to take an unbiased view at both sides.

I am going through both plans at this point in time, Barack Obama's Blueprint for Change and John McCain's Economic Plan. There is a lot of rhetoric and marketing spiel in both documents, but it does make interesting reading.

The major difference that I see is that Obama's plan is a 64-page, downloadable PDF document, while McCain's plan is on the website and all I can download is a 1-page summary of the "plan", with a lot of feel good statements. The actual McCain plan is here. If there are points for being open and upfront, I find Obama-Biden scoring big here!!! A website like McCain's that I have to dig through to get answers, well, I find that secretive and non-transparent, very similar to a speaker with folded arms!!!

On the face of it, both documents cover almost identical issues, and there is a lot of gloss, similar to the stuff in Corporate Annual Reports. The coverage also is rather comprehensive, and carefully laid out to cover almost every issue important to the American citizen.

I personally find Obama's plan a little easy to follow, because its all in one place. So the breakup of issues I'm going to use is as per the Obama plan.

1. ETHICS:

Obama Stand: Obama wants to make Washington [a synecdoche for the American Government] more transparent, specifically calling for increased communication with the masses, an end to no-bid contracts and removal of political lobbying [the Revolving Door]. It is a tough stand for a presidential candidate to take.

McCain Stand: McCain specifically talks about the "pork barrel", a government initiative to earmark taxpayers' money for pet projects. Also, he makes a prolonged statement against political lobbying, calling for removal of the "revolving door" as well.

India context: Though both sides address the lobbying issue, Obama is more specific about the "how" of increasing ethics. Also, with the issue of ending "no-bid" contracts, it might mean the levelling of the playing field for government contracts. Whether this translates into allowing Indian firms to bid for the same, needs to be seen.

Score: Obama 1 : McCain 0


2. HEALTHCARE:

Obama Stand: A very very detailed plan. It is solely focussed on inclusion, making grounds for more Americans to be brought under insurance cover. Specifically, the creation of the National Health Insurance Exchange to act as a watchdog over the private insurance market to ensure fairness and to make individual coverage more affordable and accessible. Also calls for transparency in the insurance schemes, with greater accesibility to advanced treatment and drugs for all. A detailed healthcare reform plan is available here.

McCain Stand: McCain has an equally, if not more detailed plan for healthcare. McCain specifically calls for Affordability, Access and choice, Portability and Security and Quality of healthcare insurance. For a change, McCain makes a specific reference to the "how" of healthcare reform. Apparently, this is a very touchy issue with the American population, as McCain also includes an "independent third party" comparison of his plan vs Obama's healthcare plan as well as a smear campaign against Obama's plan.

India Context: Both sides make a specific reference to the use of IT in healthcare delivery. I see an opportunity for India here. Also, Obama speaks about increased use of generics to increase affordability of drugs. The Indian generics pharma industry can benefit from this stand.

Score: Obama 2 : McCain 1


3. ECONOMY [a.k.a. the Big Kahuna]

Obama Stand: For this I had to search Obama's site, as the blueprint was a bit dated and did not fully account for the recent economic crisis that hit Wall St. However, Obama's prime focus remains the middle class, calling for reduced income tax for waged workers, enhanced worker rights, tax credit for homeowners, a five-star rating for credit cards and greater work-family balance. On the macro front, Obama promises Foreign Trade reform, re-looking into agreements like NAFTA and CAFTA as well as big specific on Innovation and Technology, including clean energy and high-skill manufacturing. There is a specific reference to bankruptcy reform, ensuring that bankruptcy of companies has minimum effect on the workforce.

McCain Stand: McCain's website has Senior Policy Advisor Douglas Holtz-Eakin endorsing the McCain Economic reform plan. And the plan is very very comprehensive, with its focus on jobs, another touchy issue with the US voters. He guns for reduced dependence on foreign oil, with gas tax holiday and increased dependency on coal. There is a" HOME plan", calling for part writeoff of the principal amount by lenders and a federal bailout for the eligible homeowner. There is also a middle-class tax cut proposal and a simplification of the taxation scheme. One important point is a one-year Government spending pause to review effectiveness of all federal programs, though it exempts "essential military programs".
McCain makes very bold statements for Clean Energy, with sops being promised galore. Also in the fray is corporate tax rate cuts, which will positively impact new businesses. McCain also proposes to overhaul the unemployment insurance scheme, thus making it an engine for "retraining, relocating and
assisting workers" who have lost a job, a welcome reform for this important government initiative.

India Context: I find McCain's plan very comprehensive, compared to Obama's plan, which seems very generic. However both sides promise a lot of tax cuts and ambitious reform plans. This will take time and will impact the "cash flow" within the economy. I see a continued slump in the US economy which will take some time to break the plateau. US specific business will have a stagnancy and it would be better off for India to explore other markets and diversify their business mix.

Score: Obama 2 : McCain 3

[I gave McCain 2 points here, as the comprehensiveness and detail of his plan impressed me. Whether it is good for America is something the economists have to concur, but it is a very detailed action oriented plan, if executed properly]

The rest of the issues in Part 2.

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