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(s)Elections See other (s)Elections Articles Title: Obama blames Clinton era for crisis Obama blames Clinton era for crisis By Edward Luce in Washington Published: March 28 2008 02:00 | Last updated: March 28 2008 02:00 Barack Obama yesterday laid much of the blame for America's unfolding credit crisis on the financial deregulation of the 1990s in his hardest-hitting attack so far on the economic legacy of Bill Clinton's administration. Mr Obama's speech - the fourth so far this week by a presidential candidate focusing on probable US recession - called for an overhaul of regulation and another $30bn (£15bn) in fiscal stimulus. Without mentioning the Clintons by name, the clear target of Mr Obama's speech was the economic record of the 1990s. Hillary Clinton has portrayed her candidacy as offering a return to the economic successes of the 1990s. She has also presented herself as more competent on the economy than Mr Obama. Mr Obama associated Mr Clinton's abolition of the Depression-era Glass-Steagall Act in 1999 with the financial scandals that rocked the early years of the Bush administration and led up to this month's bailout of Bear Stearns. Mr Obama also ascribed the bankruptcy of Enron and WorldCom in 2001 and the subsequent lack of oversight of the US subprime mortgage market to the influence of special interest and lobby groups in Washington dating from the Clinton era. He contrasted his refusal to take campaign donations from lobby groups with Mrs Clinton's acceptance of such funds. "This was not the invisible hand at work - it was the hand of industry lobbyists," he said. "Instead of establishing a 21st-century framework we simply dismantled the old one - aided by a legal but corrupt bargain in which campaign money all too often shaped policy and watered down oversight. In doing so we encouraged a winner-take-all, anything-goes environment that helped foster devastating dislocations in our economy." The Clinton campaign contrasted Mr Obama's speech, which laid out six principles for modernising what his campaign called America's "balkanised" regulatory system, with what it described as their own candidate's more detailed and practical proposals to help victims of home foreclosure. Neera Tanden, Mrs Clinton's policy director, described Mr Obama's proposals as "vague" and lacking in "concrete solutions". "On Monday Senator Clinton announced a detailed, specific plan to address the housing and credit crisis," she said. "On Tuesday, Senator McCain announced that he had no plan. And today, Senator Obama offered just words." Mr Obama also attacked Mr McCain, whose response to the subprime crisis "amounted to little more than watching this crisis happen". But economists said the significance of his speech was in offering the clearest distinction so far Mrs Clinton on the economy. Both candidates have similar economic platforms, which include scepticism on existing trade deals and a reversal of Mr Bush's tax cuts for the wealthy. Yesterday's exchange marks at least a temporary return of the Democratic campaign to a debate over policy in a race that has recently been dominated by candidates' attacks on each other's integrity. Mrs Clinton and Mr Obama have also united to portray Mr McCain as offering a continuation of Mr Bush's economic record. Mr Obama yesterday also echoed Senate calls for an investigation into rumours that traders who had taken a short position on Bear Stearns' equity had spread panic about the investment bank. And he reversed the conventional aphorism about Wall Street and Main Street. "What was bad for Main Street was bad for Wall Street," he said. "Pain trickled up."
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I wonder if Obama will work up the nerve to criticize the Telecommunications Act of 1996, another instance of the unholy cooperation of the Clinton White House and the Republican Congress. If he does, the media won't be too happy.
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