- The Washington Times - Friday, March 28, 2008

Sen. Barack Obama yesterday called for tougher government regulations of Wall Street and another $30 billion economic stimulus package, prompting his presidential rival to say he copied her plan while both Democrats criticized the presumptive Republican nominee.

Mr. Obama, echoing Sen. Hillary Rodham Clinton’s call from last week, said the government should pass a second stimulus package to help with the mortgage crisis.

Mr. Obama, of Illinois, also laid out an economic plan for regulatory reform and said he would rein in special interests as president, complaining the government has allowed the markets to “bend the rules” for the most profit at the expense of the nation’s workers.

“Under Republican and Democratic administrations, we failed to guard against practices that all too often rewarded financial manipulation instead of productivity and sound business practices,” Mr. Obama said at the Cooper Union in Manhattan, N.Y. “We let the special interests put their thumbs on the economic scales … [resulting in] a distorted market that creates bubbles instead of steady, sustainable growth; a market that favors Wall Street over Main Street but ends up hurting both.”

Mrs. Clinton campaigned yesterday in North Carolina and announced a plan to invest $12.5 billion over five years in a work-force development program to educate or retrain workers who lost jobs due to trade, outsourcing or the sagging economy.

“There’s been too little thought and effort to help people gain new skills while they still have their existing jobs,” said Mrs. Clinton, of New York.

Mrs. Clinton said Republican Sen. John McCain of Arizona has a plan that does “virtually nothing” to ease the nation’s credit and housing problems while Mr. Obama said Mr. McCain has done little more than just “watching” the housing crisis.

“While this is consistent with Senator McCain’s determination to run for George Bush’s third term, it won’t help families who are suffering, and it won’t help lift our economy out of recession,” he said.

The McCain campaign in a statement accused Mr. Obama of offering nothing but “liberal tax and spend, big government policies that hit hardworking American families at a time when they’re most vulnerable, and are certain to move America backward.”

In his speech, Mr. Obama said the divide that once existed between Main Street and Wall Street is so blurred the plight of everyday Americans has hurt the entire market: “Pain trickled up.”

He also proposed to expand oversight to any institution that borrows from the government; toughen capital requirements for complex financial instruments like mortgage securities; and streamline regulatory agencies to end overlap and competition among regulators.

But he did not detail how the different agencies should be organized or exactly how the government should go about peering over the shoulders of bank executives, though aides said later the Federal Reserve would have to assume a greater role.

“I will not pretend that this will come without cost, though I have presented ways we can achieve these changes in a fiscally responsible way,” he said.

The Clinton campaign characterized the speech as “just words,” and said the former first lady offers “specific rather than broad principles.” The campaign also said Mr. Obama had “copied” her stimulus idea.

During a conference call following the speech, reporters pressed Obama economic adviser Daniel Tarullo for specifics. He said the speech was a starting point, adding that regulation is a massive effort.

This article is based in part on wire service reports.

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