The man who helped design one president’s economic policy hopes to do the same for an Obama administration, and he told local business leaders it’s the right path to take.

Gene Sperling, national economic adviser to President Bill Clinton and director of the National Economic Council from 1996 to 2000, spoke with half a dozen Wabash Valley leaders Tuesday afternoon at the Crossroads Cafe, on his way to more campaigning for Democratic candidate Sen. Barack Obama.

Sperling said he got to know Obama after his keynote speech at the 2004 Democratic National Convention, and helped with Obama’s book “The Audacity of Hope.”

Because of his relationship with Clinton, Sperling didn’t jump on board Obama’s team until Sen. Hillary Clinton bowed out of the primary, but as the race between Obama and Republican Sen. John McCain draws to a close, he’s full steam ahead for Obama.

“We need some bold leadership,” Sperling said, noting that if Obama is elected, he won’t wait until mid-January to begin work.

Topics in the hour-long discussion ranged from health care to energy policy to real estate, but its theme was the impact on America’s small-business owners.

“What I’m seeing is a drying up of the housing market,” noted Terre Haute City Council President Todd Nation, D-4th, owner of Book Nation as well as rental properties and a contracting company.

Nation said unless remedied, “big problems are on the horizon.”

Sperling said Obama’s is his sixth presidential campaign, but “no one has been through something like this” regarding the economic crisis.

And while the recent collapse of global finance leaders has drawn the most public attention, Sperling noted “our economic problems did not start with the financial crisis.”

Working class families have seen their incomes drop compared with inflation while the cost of energy, health care and other commodities rose.

This spread has been moving for years, he said, and at various points in the discussion he pointed to what he called the “proactive approach” taken by the Clinton administration as opposed to the “hands-off” one of President Bush.

Sperling also took shots at “exaggerations” made by McCain’s campaign, which he claimed have been leading voters into believing that all small businesses grossing in excess of $250,000 per year will be taxed more harshly by Obama.

About 90 percent of America’s small businesses make less than $90,000 a year, he said, noting the difference between gross, net and taxable income. Payroll to workers is written off as an expense and taken out of the gross, he offered as an example.

Meanwhile, the existing tax code is such that in one building in the Cayman Islands, about 18,000 American companies supposedly have their headquarters.

“Either that’s the biggest building in the world, or the biggest tax haven in America,” Sperling said, adding that a McCain tax plan would likely allow for such cushioning of big companies under the guise of helping small businesses.

Kevin Maher of Maher Construction cited health care for employees as one of the biggest concerns facing businesses unable to provide it for workers who cannot afford it themselves.

Sperling said part of the political fallout from the credit crisis has been distraction from what he considers one of the fundamental issues of the campaign — health care.

“If you look at most surveys for small business, you’ll see that health care is one of their biggest concerns,” he said.

Sperling also blamed the phenomenon of “cost shifting” on the lack of a national plan, explaining that the uninsured go to hospitals and don’t pay, thus shifting those costs onto others.

In many ways, he said it’s a civil rights issue because “once you get sick, you’re frozen out of system.”

Sperling recounted colleagues in the insurance industry whose sole job is to calculate the odds of parents having expensive pregnancies and then eliminating them from coverage.

“It’s embarrassing,” he said of America’s health-care policy compared with other countries, noting “the main reason people are going into bankruptcy in our country is health care.”

Energy costs also top the concerns, and Pat Goodwin said a real discussion of the problem is not conducive to an election victory.

“The real solution to the energy crisis is to use less energy, but no one wants to hear that,” he said.

Sperling agreed, noting that energy change must come “from the bottom up” and that habits and lifestyles must change, including incentives for buying hybrids and energy-efficient homes.

“I haven’t met a single family yet that enjoyed paying $4 a gallon for gasoline,” he said, adding that some lifestyle changes will take a generation to implement fully.

But overall, Sperling said one of the fundamental differences between recent Democrat and Republican administrations is the government’s role in the economy.

“Government just can’t respond this slowly to a crisis,” he said.

One of the lessons learned from the Great Depression is that there are times that government spending can actually help stimulate the economy, he said, offering the example that if schools renovate their buildings, local contractors get the work.

“Obviously you can’t run an economy forever like that,” he said, but it might just be the jolt America needs for now.

Brian Boyce can be reached at 812-231-4253 or brian.boyce@tribstar.com.

Trending Video

Recommended for you