To restore a sense of opportunity for all Americans - rekindling the American Dream

New York City Mayor Michael Bloomberg introduced Senator Barack Obama’s economic address at Cooper Union today (27 March 2008.) Bloomberg has been widely regarded as both a canny, successful business executive and a potential dark-horse entry into the 2008 Presidential race, and so his appearance seems to signal strong support for Obama’s candidacy and economic priorities.

Obama, who started trying to draw the attention of Bernanke and Treasury Secretary Paulson to the looming sub-prime mortgage crisis over a year ago, ramped up his focus on home-owners, the inadequate regulatory framework, and called for an additional $30 billion stimulus package to jumpstart the economy which slumped badly in the 4th quarter. The particulars of Obama’s speech are already available online at his campaign website, as are comments on and endorsements of his plan by financial experts Paul Volcker, William Donaldson, Joseph Stiglitz, and Robert Reich.

Obama’s prepared remarks are also already available online, naturally, as his campaign works relentlessly at providing the voters copious, detailed information about his positions, speeches, priorities, and vision. [Excerpts follow]

Our free market was never meant to be a free license to take whatever you can get, however you can get it. That is why we have put in place rules of the road to make competition fair, and open, and honest. We have done this not to stifle - but rather to advance prosperity and liberty.

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…we have deregulated the financial services sector, and we face another crisis. A regulatory structure set up for banks in the 1930s needed to change because the nature of business has changed. But by the time the Glass-Steagall Act was repealed in 1999, the $300 million lobbying effort that drove deregulation was more about facilitating mergers than creating an efficient regulatory framework…

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First, if you can borrow from the government, you should be subject to government oversight and supervision…Second, there needs to be general reform of the requirements to which all regulated financial institutions are subjected…

Third, we need to streamline a framework of overlapping and competing regulatory agencies…

Fourth, we need to regulate institutions for what they do, not what they are. Over the last few years, commercial banks and thrift institutions were subject to guidelines on subprime mortgages that did not apply to mortgage brokers and companies…

Fifth, we must remain vigilant and crack down on trading activity that crosses the line to market manipulation…

Sixth, we need a process that identifies systemic risks to the financial system. Too often, we deal with threats to the financial system that weren’t anticipated by regulators…

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…We have as our inheritance the greatest economy the world has ever known. We have the responsibility to continue the work that began on that spring day over two centuries ago right here in Manhattan - to renew our common purpose for a new century, and to write the next chapter in the story of America’s success. We can do this. And we can begin this work today.