July 28, 2007

Will Obama's Debate Answer Impact Your Wallet?

Pundits have been chewing on the answer Barack Obama gave in the YouTube debate Monday night about meeting with heads of state from rogue nations such as Cuba, North Korea, Iran, Syria, and the potentially rogue Venezuela. Hillary Clinton's public scolding of Obama as "irresponsible" raised the stakes and gave her an opportunity to highlight the difference in experience between herself and Obama. It may wind up strengthening her grip on the nomination.

Wall Street Journal reporter John Harwood has just launched his new Political Capital blog at CNBC, and he argues that these events could carry a cost for taxpayers -- and it's good to start planning early:

The world of business and finance may consider the fight between Barack Obama and Hillary Clinton over foreign policy, which emerged at this week's YouTube debate, as irrelevant to their concerns. That view is wrong.

It's true that, in a narrow sense, neither Wall Street nor the investor community has a direct stake in the back and forth over whether either prospective Democratic president would agree to face to face meetings with Hugo Chavez or Fidel Castro or other anti-American tyrants. The Obama-Clinton sparring was quintessential political sparring.

Yet, it was sparring that could affect the trajectory of the 2008 race. Anything that moves the needle on who's likely to become the next president by definition makes it an issue for investors to follow. And there's reason to think Hillary Clinton's chances of becoming presidential took a small step forward this week.

John's a smart guy, and I'd trust him with my investments any day -- probably more than I'd trust myself. However, I think this is just a little premature. In the first place, this is still July 2007, and we still have six months before anyone casts a single vote in a primary. Each of these dustups may impact the final outcome, or something more significant could happen next week or next month. It's too early to declare turning points or to start writing political obituaries.

John doesn't explain any difference between the two candidates in terms of their approach to finance and business, either. I'm certain they have some points of disagreement on taxation and regulatory policy, but somehow I don't think the differences will be that significant. It's much more likely that the Democratic nominee will adhere to fairly traditional Democratic policies on economics. That would only be wrong if the party nominated a radical such as Dennis Kucinich, which will only happen if Repulicans manage to find Aladdin's lamp.

If Hillary has hit on a formula that made her more electable in a general election, where the differences between Republican and Democratic policy are more known and pronounced, then John would be more correct than he is here. That would also depend on the Republican nominee, too, a race that is harder to gauge than the Democratic primary campaign at the moment. Again, though, we have six months to go before the primary season starts, and sixteen to the general election.

Be sure to keep an eye on John's new blog to keep up with the intersection of politics and finance.


TrackBack URL for this entry:

Comments (5)

Posted by Andrew X | July 28, 2007 10:19 AM

Dow Jones plummeted by almost a thousand. Other markets too.

I'm just sayin'.....

Posted by Kim | July 28, 2007 11:34 AM

Reading his book. There is something very attractive in Obama? You get the feeling that this isn't the same old, same old. I can't put it to words. I'm sure the "reputation police" are out there digging for dirt, anything that can slow him down. Edwards is overloaded with lawyer wealth, that creates a Yuk factor. This is old and tired, but Obama is 1960's Robert Kennedy, old but still new?. I look for that calmness, that facial expression that says: "I'd like to have it, but if I don't have ... it, so what"......On the other hand I like Rudy, because you can feel the passion below the surface, the energy of the man.

Odd on how some of us are stuck on visuals, trying to peer into the soul of the ambitious.

Posted by J | July 28, 2007 2:16 PM

We need to call her Mrs. Clinton at all times. Using "hillary" separates her from Mr. Clinton. Her marketing crew is very astute and has decided to market her as President Hillary. They've tried Rodham and it didn't work.

PLEASE, call her Mrs. Clinton. We need to associate her with Mr. Clinton. For those of you who worry, he never got a majority of the votes. His perception is bigger than reality. She's Mrs. Clinton, period.

Posted by stackja1945 [TypeKey Profile Page] | July 28, 2007 8:38 PM

HC needs more White Water for us to see the real person.

Posted by MarkT | July 28, 2007 11:26 PM

Here a recent poll result:

"Forty-two percent (42%) of Americans say that the next President should meet with the heads of nations such as Iran, Syria, and North Korea without setting any preconditions. The latest Rasmussen Reports national telephone survey finds that 34% disagree while 24% are not sure."

In other words, Americans generally agree with Obama on this one.