US nationalizes banks, candidates talk economy

Mike Whitney: Both candidates promote stimulus but real solution is higher wages

US President George W Bush made the radical announcement on Tuesday of the partial nationalization of the nine of the nation's leading banks. The move to part ownership by the government, was made to ensure that the banks won't be hoarding their bailout money, but use it to bolster lending -- to each other and to customers. The Presidential candidates also announced their economic proposals to deal with the current financial meltdown. Barack Obama spoke in Ohio on Monday: "Today, I'm also proposing a 3 month moratorium on foreclosures. If you're a bank or a lender that is getting money from the rescue plan that passed congress and your customers are making a good faith effort to make their mortgage payments and renegotiate their mortgage, you will not be able to foreclose on their home for 3 months." Obama also proposed allowing people to withdraw up to 10 thousand dollars from their retirement accounts without any penalty for the remainder of the year and 2009. A $3,000 tax credit for every new full-time job created in the US by businesses for the next 2 years. To suspend the tax on unemployment benefits for the rest of this year and next. And to have the Federal Reserve provide short-term loans to state and local governments caught in the credit crunch. John McCain made his announcement in Pennsylvania Tuesday."On my orders, the Department of the Treasury will guarantee one hundred percent of all savings accounts for a period of six months. - I will cut in half the capital gains tax on stocks purchased and held for more than a year from a rate of 15 to 7.5 percent.” McCain also proposed that for 2009 – 2010, those over 59 who take money out of their retirement accounts should only be taxed at 10%. To Raise the deduction on stock losses from $3000 to $15000, And like Obama, to suspend the tax on unemployment benefits for the rest of this year and next. The Real News Network spoke to Counterpunch columnist Mike Whitney.

US nationalizes banks, candidates talk economy